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Old 16-02-06, 04:39 PM   #1
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Default Peer-To-Peer News - The Week In Review - February 18th, ’06


































"I gave my parents a machine running Linux, and they know no different. I showed them where to click to start the Internet, and they got on with it. It doesn't faze them at all." – Wayne Lee


"A threat to intellectual property rights in the Internet remains underestimated." – Vladimir Kolesnikov


"What does this litigation do? It destroys people's lives. It's not a tool that should be used except in the most drastic circumstances." – Terry McBride


"This ruling makes it clear that the Google Cache is legal and clears away copyright questions that have troubled the entire search engine industry." – Fred von Lohmann




































February 18th, ’06









MPAA: DRM "Helps Honest Users"
Ken "Caesar" Fisher

The justifications for Digital Rights Management are many, but they usually involve some flavor of anti- piracy rhetoric. Consumers have accepted DRM into their lives, by and large, but there is a growing awareness that not all DRM is created equal. Rather, consumers appear to gravitate towards DRM solutions that aren't complex or messy; one has only to look at iTunes to see a successful enterprise built atop DRM. In my own experience, I've found that most of Apple's customers view Apple's FairPlay DRM favorably, largely because it doesn't create inconveniences, and it is moderately permissive. But no one goes to the iTunes Music Store because of the DRM. No, the more accurate way to look at it is to say that people go there in spite of it.

The MPAA, however, has a very different spin on DRM. In their view, DRM is your friend, and life without DRM could be messy and complex. So says Dan Glickman, of the Motion Picture Association of America:

"Content owners use DRMs because it provides casual, honest users with guidelines for using and consuming content based on the usage rights that were acquired. Without the use of DRMs, honest consumers would have no guidelines and might eventually come to totally disregard copyright and therefore become a pirate, resulting in great harm to content creators," he said.

Without DRM, you might become a pirate. Welcome to this Brave, New World, friends. The MPAA is here to save us from ourselves.

This cleverly veiled justification comes in response to a question from the BBC about the efficacy of DRM: is DRM useless if movies end up on P2P networks regardless? Glickman's response was slick, and it needed to be. DRM doesn't stop piracy, but the MPAA loves it. Why? It makes them lots and lots of money.

Want to make a back- up of that SpongeBob movie before the kids destroy it? Too bad: the helpful MPAA didn't want you to do that anyway. You could buy another one, though. Want to transfer your DVD to a mobile DVD? Too bad! Perhaps you could buy the UMD though? The helpful MPAA is too worried that you might slip, trip, fall, and accidentally become a pirate while exercising your fair use rights. Fortunately, you can buy your way to safety.

It's all about the Benjamins

Mr. Glickman, I have a question for you (and I know one of your underlings will read this): if DRM is about helping honest users, then why does your DRM make fair use impossible? Why does your DRM make it impossible to backup movies that I have bought? Why is it impossible to legally put DVDs that I've purchased onto my iPod? Why is it impossible for me to extract clips from your movies for educational purposes? These are all things I have a legal right to do, but can't, because of the DMCA: a law that your organization cheerleads for.

Perhaps I don't need an answer from Mr. Glickman. He also told the BBC that DRM aims to "support an orderly market for facilitating efficient economic transactions between content producers and content consumers."

Hold up now. Which is it? I don't remember Jack Valenti and friends saying anything about new economic transactions, really. I do remember plenty of talk about terrorists and drug dealers thriving off of piracy, however, and I remember those kinds of hyperbolic arguments being used to justify draconian laws. Is this the kinder, gentler side of the MPAA? Who knows, but it is surprising to see Glickman essentially admit what's going on: DRM is about economic transactions, that's for sure. But the notion of "facilitating economic transactions" would be better expressed as "legislatively creating a market" for those economic transactions, because that is what DRM is all about. First you make it illegal to circumvent DRM (hello, DMCA), then you put DRM on everything. It's the double- dip, the "pay for this a few times" approach to business. That's why we can't make backups, and that's why they absolutely hate the idea of taking DVD content and putting it on a mobile. You should pay for that. And that. And that there, too.

Indeed, one only has to look at the concept of "customary historic use" to see the dismantling of fair use spurred in large part by the MPAA. Or consider the Digital Transition Content Security Act of 2005. This legislation wants to see something you have been able to do for more than 20 years (namely, record TV) reduced to another method of "facilitating economic transactions" by stripping you of that historical right. Hollywood never got over Betamax and VHS being legal, and DRM is their plan for an 11th hour victory.

DRM's purpose is to help honest people stay honest? What a joke.
http://arstechnica.com/news.ars/post/20060210-6153.html





Lavigne's Managers Help Fund Music Fan's Downloading Battle

Officials at Canadian pop rocker Avril Lavigne's management company are helping a fan fight America's Recording Industry over an illegal song-sharing charge.

Nettwerk Music Group bosses are to fund a Texas fan David Gruebel's legal campaign against corporate chiefs, who are suing him for damages after he illegally downloaded Lavigne's SK8ER BOI hit, among other songs.

NMG chief executive officer Terry McBride says, "What does this litigation do? It destroys people's lives. It's not a tool that should be used except in the most drastic circumstances."
http://contactmusic.com/new/xmlfeed....tle_14_02_2006





Top Russian Prosecutor Wants File Sharing Legalized
MosNews

Russia’s top prosecutor has called for legalizing file sharing in the Internet, hoping that the move would help combat piracy, Prime-Tass reported on Tuesday.

“A threat to intellectual property rights in the Internet remains underestimated.” Deputy Prosecutor General, Vladimir Kolesnikov, told the lower house of the Russian parliament, the State Duma.

“Establishing legal websites could help decrease piracy on the web,” he said.
http://www.mosnews.com/news/2006/02/14/dwnldfiles.shtml





Nevada Court Rules Google Cache is Fair Use

Important Milestone for Digital Copyright Law

San Francisco - A federal district court in Nevada has ruled that Google does not violate copyright law when it copies websites, stores the copies, and transmits them to Internet users as part of its Google Cache feature. The ruling clarifies the legal status of several common search engine practices and could influence future court cases, including the lawsuits brought by book publishers against the Google Library Project. The Electronic Frontier Foundation (EFF) was not involved in the case but applauds last week's ruling for clarifying that fair use covers new digital uses of copyrighted materials.

Blake Field, an author and attorney, brought the copyright infringement lawsuit against Google after the search engine automatically copied and cached a story he posted on his website. Google responded that its Google Cache feature, which allows Google users to link to an archival copy of websites indexed by Google, does not violate copyright law. The court agreed, holding that the Cache qualifies as a fair use of copyrighted material.

"This ruling makes it clear that the Google Cache is legal and clears away copyright questions that have troubled the entire search engine industry," said Fred von Lohmann, EFF senior staff attorney. "The ruling should also help Google in defending against the lawsuit brought by book publishers over its Google Library Project, as well as assisting organizations like the Internet Archive that rely on caching."

Field v. Google ruling:
http://www.eff.org/IP/blake_v_google...vada_order.pdf
http://www.eff.org/news/archives/2006_01.php#004345





California Tying Education Tech Grants To Copyright Education
Ken "Caesar" Fisher

Legislation is being considered in California that would see the state's educational technology grant program tethered to requirements for teaching copyright law to students. Introduced nearly a year ago, AB 307 would amend section 51871.5 of the Californian Education Code to include new preconditions for public schools applying for funding under the oversight of the California Technology Assistance Project. The project is designed to provide a network of technical assistance to schools and their districts in implementing education technology as determined by the Californian State Board of Education.

Schools that wish to apply for grants will need to demonstrate that they have a plan to educate their students in three areas: the "ethical behavior in regards to the use of information technology," "the concept, purpose, and significance of a copyright," and "the implications of illegal peer-to-peer network file sharing."

The bill is the brainchild of California Assemblyman Ed Chavez, who decided that such legislation was needed after observing studies that show that the largest groups of P2P users are teens and people in their 20s.

"This activity has resulted in multi-billion dollar losses to the content industries in California particularly the music and filmed entertainment industries," according to a comment from Chavez's office. "When computers at public schools and college campuses are used for illegal file sharing, precious and costly bandwidth is consumed resulting in increased costs to taxpayers. An educational program targeted at students could help stem this activity. Many students, teachers, and parents do not realize that downloading a copyrighted song or film over the Internet is illegal and no different than stealing a CD or DVD from a retail store."

Assemblyman Chavez's office also indicated that the MPAA has formally supported the bill, and the RIAA is also a backer. Citing a Pew Internet and American Life Project report, the Assemblyman's office indicated that they are concerned about Americans' "dismissive" views on copyright.

The bill has been referred to the Committee on Education, and few expect it to meet much resistance on its path to becoming a law. Should it pass, the Visual and Performing Arts Framework for California Public Schools will be used to determine the content of the teaching.

Propaganda or power to the people?

School districts around the country are considering their own educational efforts as they relate to technology, although most are grappling with more basic issues such as access to computing technology, training, and making technology relevant to education. Nevertheless, educators and politicians are starting to understand that the educational environment is an ideal setting for educating students about copyright law, but there are no shortage of concerns regarding what that education will entail. While stopping unbridled P2P usage is at the top of most curricula, fair use isn't.

A case in point is the MPAA's public education effort on their own site. The industry association once hosted a FAQ for DVD usage, but many believe that it was so riddled with errors and misstatements that the MPAA simply removed the FAQ. The MPAA, for instance, had described the DMCA as being designed to implement World Intellectual Property Organization (WIPO) treaties, when the DMCA in fact goes far, far beyond anything required by the WIPO treaties in question (treaties that have not yet been fully honored or ratified by most other nations). Such matters may seem minor, but to many educators, they're anything but.

Other the other hand, many parents and politicians are more concerned with results than methodology, especially in this age of lawsuits aimed at fire sharers. In their view, an educational program, even if it is biased in the direction of the entertainment industry, is better than nothing at all.
http://arstechnica.com/news.ars/post/20060215-6184.html





Taiwan Set To Stay On Piracy List

Intellectual Property: A group of powerful US businesses has recommended that Taiwan stay on the list for another year, citing a big increase in Internet piracy
Charles Snyder

The chances that Taiwan will soon be removed from a US government list of countries with troubling rates of intellectual property violations sank drastically on Monday when a powerful US business group recommended that it be kept on the list for another year.

While the group, the International Intellectual Property Alliance (IIPA), commended Taiwan for making improvements in its fight against piracy of software, videos, music, films, TV shows and books, it complained about what it called a troublesome increase in Internet piracy in Taiwan, including piracy over the government's TANet network.

The recommendations of the group, a confederation of seven trade associations representing 1,900 firms in the high- tech, entertainment and publishing industries, are usually automatically followed by the US Trade Representative office, which publishes its annual list of countries with piracy problems in the spring.

Taiwan is now on the so-called "Watch List" under the US "Special 301" trade law. Taiwan was on the more serious "Priority Watch List" until January last year, but was lowered to its current status by the trade representative's office at the recommendation of the IIPA. It had been on the priority list since 2001.

While inclusion on the Watch List presents no imminent danger of trade sanctions, it is expected to severely hamper Taiwan's efforts to make progress toward a free trade agreement with Washington, which the country's officials have been working on for several years.

It also represents another point of political contention between Taipei and Washington.

The IIPA estimates that US companies lost US$376.9 million last year as a result of piracy in Taiwan, mainly in the entertainment software and motion picture industries. While that was well below the record US$847.9 million the IIPA estimated that US firms lost in 2002, it is up from the US$320.4 million figure for 2004.

The IIPA zeroed in on the Internet when making its recommendations for action.

"Taiwan is beset by rapidly increasing instances of Internet piracy, especially through unauthorized peer-to-peer [P2P] file sharing services. As the problem grows, so must the response," the group's report said.

Internet piracy "has become the predominant form of piracy for most industries in Taiwan," the IIPA says.

For instance, it says the number of online infringements involving business software traced to Taiwan exceeded 344,000 in the first 10 months of last year, up from under 50,000 for the whole of 2004. Music, books and other types of intellectual property are also showing sharp rises in online violations.

The group said that enforcement must be expanded by the two agencies responsible, the Joint Internet Infringement Inspection Special Task Force and the IPR Police.

This should include extra resources for training, equipment and manpower for the two ill-equipped agencies.

In addition, companies providing Internet access should be asked to cooperate, and the law should be changed to clarify their liability and provide for penalties.

The TANet network "is being used widely throughout Taiwan for Internet piracy, including P2P file sharing," the group said, with the Ministry of Education claiming that it has no lawful obligation to impose controls on the situation.

The report also urged effective action against the illegal photocopying of books, especially academic texts, journals, English-language teaching materials and professional reference books.

Other recommendations include effective monitoring of exports of counterfeit cartridge-based video games and their components, and an expansion of the new Intellectual Property Court to handle more copyright cases.

The report also recommends that China remain on the US Trade Representative's Priority Watch List for another year.

It estimates that US businesses lost nearly US$2.4 billion due to piracy in China, making it the world's worst offender in piracy of intellectual property.

Taiwan's Response

Jack Lu, deputy director-general of the Ministry of Economic Affairs' Intellectual Property Office, said that his agency was aware of the IIPA's suggestions, and that it would try to negotiate with the group and clear up any doubts it had before an official announcement is made in early May.

Taiwan has made a concerted effort to improve the protection of intellectual property and had high hopes of being removed from the list, office Director-General Tsai Lien-sheng said last month.

Citing a preliminary estimate, Tsai said that Taiwan's piracy rate had dropped from 43 percent in 2004 to 36 percent last year.

Additional reporting by Jessie Ho
http://news.google.com/url?sa=t&ct=u...cid=1104271940





China Portals Offer Tonza Pirate MP3s like Jet Li "Fearless" Theme

If you read Chinese, and you spend time on sites like Baidu and Yahoo.cn, please roll your eyes and skip this post -- nothing here will be news to you.

I do not read Chinese, though, and I've never clicked around much on the big Chinese portals -- so when I spent some time poking around this weekend, I was surprised to see that at least two of the biggest ones offer "MP3s" as a top-level tab. If you're a non-Chinese-reader, run Yahoo China's "MP3" tab through Babelfish, and you'll see that it offers a ton of bootlegged hit songs in various DRM-free file formats.

In the "MP3s" section of Baidu and Yahoo China, I stumbled on Taiwanese pop star Jay Chow (aka Zhou Jie Lun)'s theme song for Fearless (Huo Yuan Jia), the new Jet Li action movie about 19th-century martial arts hero Huo Yuan Jia. Here's one ripped MP3 of the song, here's another -- it's wicked catchy. Sort of hiphop meets backstreetboys meets chinese opera (sung in falsetto by a dude). After I listened about forty times, I found the movie's official site (gah, no US release dates! I'd gladly pay to see it!), and the music video: high, low.

I like the part in the music video where the dude is being such a hard-ass rapper and he punctuates the end of a line with the FAN. Like, "BLAYUMM-- how you like me now, with my figgidy-FAN?!" I give Jay-Z like five minutes to rip this off cover this.

Incidentally, the little popup media window that appears when you select an MP3 on Yahoo China says (via Babelfish), "The force recommendation use fart fart dog (PPgou) downloads acceleration software high speed downloading, the speed multiplies!" Whatever fart fart dog is, it's nice to know that The Force believes it's helpful.
http://www.boingboing.net/2006/02/14...ls_offer_.html





All pics on site

China Pirates

If you think Malaysia’s state of piracy is bad, you ain’t seen nothing yet. China is where Uncle Ho got his MBA in Piracy. They can pirate anything and nothing’s stopped them for doing it. Proton ripping off Alfa’s grill for the Perdana V6 and Alfa’s sport rims design for the Proton Gen2 is nothing compared to what Chinese car manufacturers are capable of.

1. Laibao SR-V

This car by Shuanghuan Motors. It’s a complete blatant rip-off of the Honda CR-V although only in exterior design. The interior is damn chapalang the last time I saw it. Couldn’t find photos of it for this post. The engine’s using a very old Toyota engine, probably old stocks. Shuanghuan also ripped off Audi’s 4 rings to use as it’s logo. It’s using 2 rings instead.

Both Honda and Audi have gone after Shuanghuan with lawsuits. Honda was asking for 100 million yuan as compensation but so far nothing has resulted probably because of protection by the China government.

2. Geely Merie

This has gotta be the most bold rip-off of all time! Most fo the Geely cars are based on the old C- class and E-class Mercedes Benz. Even Ssangyong does it, although theirs was a proper legal transfer of design. But I’ve never seen such a bold attempt at ripping off the latest C class.

Check that out, it’s the latest peanut-eye Mercedes C class. Wait, it’s not a Mercedes?! It’s a GEELY MERIE! Sheesh, just looking at it really makes me feel geli, or should I say it makes me feel “Geely”?

Even the back is the same. I wonder what the Chinese translation for Kompressor is. Maybe they’ll just rename it to Kopier instead? Kopycat?

Yeah, take the body design of a car designed with a sporty look and comes with 16 inch rims (17 inch on the C32) and you stick 13 inch rims on them. Look at the size of the wheel arch compared to the relatively small 13 inch wheels they put on it. The people at Geely are too cheap for 16 inch rims and tyres. Oh wait, the wheels have gone through their Kompressor(tm) technology… must be.

3. Chery QQ

The Chevrolet Spark, or known by it’s nickname Chevy Spark was designed solely for the China market, designed for city driving - fuel economy and easy parking. But not even a year after the Spark was introduced, Shanghai Automotive Industry Corp released a model that looked suspiciously strikingly similiar called the Chery QQ. WTF? Chevy = Chery. ROTFLOL! A GM spokesperson said: “If you didn’t have the name tags on the car, you couldn’t tell them apart. It’s such a knockoff that you can pull a door off of the Chevy Spark and it fits on the QQ - and it fits so well that the seals on the door hold.“

These two models are going to be available in Malaysia so you can see China’s excellent piracy skills with your own eyes. Chevrolet just starting bringing the Spark into Malaysia and Naza wants to bring in the QQ. The Spark will cost about RM40,000 but rumours are saying that the QQ would cost almost 10K cheaper, although they are just rumours.

Others

I have strong suspicion that the car above called the “Deer” by GreatWall Motors is actually a ripped-off Toyota Hilux. The fact that it’s called Deer when Toyota trucks and MPVs in Indonesia are called Kijang makes me even more sure.

What else?

Sing SUV - Nissan X-Trail
Geely - Ripped off Toyota’s logo
Hongda (wtf? Big Red?) - Ripped off Honda

What are you waiting for? Go get your MBA in Intellectual Property Piracy from any university in China today!
http://paultan.org/archives/2004/12/05/china-pirates/





So Long, Dalai Lama: Google Adapts to China
Joseph Kahn

SO what does the Dalai Lama look like, anyway?

Chinese Tibetans or other Buddhists who might be curious could try finding images of the spiritual leader on Google.cn, a new search engine that Google tailored for China and is now, two weeks after its unveiling, on full display to local Web users.

Is he that guy with puffy cheeks wearing a Western suit? No, that's Liu Jianchao, China's foreign ministry spokesman, demanding that the Dalai Lama stop trying to split the motherland. What about that balding man leading a big delegation? No, that's Chen Yi, a late Chinese vice prime minister, offering grain to the Tibetan people.

Only one of the 161 images produced by searching in Chinese for the Dalai Lama on Google.cn shows the 14th Dalai Lama, the spiritual leader of Tibet since 1940. He is pictured as a young man meeting senior Chinese officials. That was before 1959, when China's People's Liberation Army invaded Tibet and the Dalai Lama fled into exile.

For people outside China, or Chinese who can circumvent the Internet firewall, the 2,030 images on unfiltered Google.com favor the Dalai Lama of today. He is the genial-looking guy in the burgundy and saffron robe, here meeting President Bush, there speaking to 40,000 people in New Jersey.

Several of the biggest media and technology companies have come under attack for helping the Chinese government police the Web. Yahoo provided information about its users' e-mail accounts that helped the authorities convict dissidents in 2003 and 2005, Chinese lawyers say. Microsoft closed a popular blog it hosted that offended Chinese censors. Cisco has sold equipment that helps Beijing restrict access to Web sites it considers subversive.

But few have cooperated as openly as Google. Google's local staff works closely with Chinese officials to ensure that search results from Google.cn do not include information, images or links to Web sites that the government does not want its people to see.

Google.com, the company's main international search engine, is still available in China, though it often operates inefficiently because it produces links that cannot be opened inside China's firewall.

Google.cn, Google says, works faster and serves its users better — and Google places a blunt but discreet disclosure of censorship on the bottom of Web pages that include elided search results. Even so, critics say, the service violates Google's motto, "Don't Be Evil." They say the company has lent its expertise and good name to blocking information on religion, politics and history that the Communist Party feels might undermine its monopoly on power.

"It was one thing when you hit on links that did not work. You could see what was blocked," said Liu Xiaobo, a leading dissident writer. "The new Google hides the hand of the censor."

In other words, it's no longer possible to tell what the censors are hiding, only that something is being censored.

In some cases, the manipulations are fairly subtle. Students wanting to learn more about the "Republic of China" on Google.cn would be steered to information about the period from 1912 to 1949, when the mainland was called Republic of China and the Communists had not yet taken power. The same search on Google.com provides links to sites in archrival Taiwan, which still formally goes by that name.

In other cases, the omissions are glaring. Searches for photos of Tiananmen Square on regular Google produce many shots of a man blocking a column of tanks outside the square, the iconic image of the 1989 democracy movement and the later crackdown.

Google.cn features soldiers raising the national flag and tourists taking snapshots of each other in the square, the sun shining in a sapphire sky.
http://www.nytimes.com/2006/02/12/we...ew/12kahn.html





Web Firms Face Grilling on China
Amy Schatz

Executives from Google Inc. and other Internet companies head to Capitol Hill next week, where they will become feature players in an awkward debate: Are U.S. companies giving in to China too easily?

Last month, Google announced an agreement with the Chinese government to censor search results from its Chinese site. It was the latest Internet company to accede to the Chinese government's censorship restrictions, following Cisco Systems Inc., Microsoft Corp. and Yahoo Inc.

The hearing will likely produce more embarrassing publicity for the companies, and it may drive legislative momentum among lawmakers concerned about China's influence on the U.S. economy. Congressional aides are expecting a standing-room-only crowd, and the reception from politicians may be chilly.

"I was asked the question the other day, do U.S. corporations have the obligation to promote democracy? That's the wrong question," says Rep. Chris Smith, the New Jersey Republican and chairman of the House human-rights subcommittee that is holding the hearing. "It would be great if they would promote democracy. But they do have a moral imperative and a duty not to promote dictatorship."

Mr. Smith plans to introduce legislation next week that would impose restrictions on Internet companies seeking to expand into China but also provide some legal protection from Chinese demands.

The bill would require U.S. Internet companies to keep email servers used for Chinese traffic offshore. That would help prevent the Chinese government from compelling the release of Internet user data. The bill also calls for creation of an office inside the State Department that would make an annual determination about which countries are restricting Internet use. It would provide a framework for users to pursue legal action against U.S. Internet companies over privacy violations.

The disclosures about Internet companies cooperating with the Chinese government are having a wider political impact. Last week, Sens. Lindsey Graham, (R., S.C.) and Byron Dorgan (D., N.D.) cited Internet companies' efforts to help the Chinese government monitor citizens' online activity as a reason to permanently revoke China's most-favored-nation trading status.

Ironically, the controversy comes as Google, Yahoo and others are fighting for "Internet freedom" in the U.S. Google is resisting a Justice Department request for information on user searches to help prosecute violations of a federal child-pornography law. Meanwhile, the company has joined competitors to resist plans by telephone and cable companies keen on exerting more control over Internet lines, which has led to concerns about discrimination and content blocking.
http://online.wsj.com/public/article...html?mod=blogs





Bill Would Keep Servers Out Of China
Jim Hopkins

Free-speech advocates have blasted Google and other Internet companies for bowing to China's demands that they censor or fork over information the communist government deemed objectionable.

A partial screen shot of Google.cn's search returns on the words "Tiananmen Square":

Now, Congress is stepping in with proposed legislation that could hobble the companies as they plunge deeper into one of the world's hottest economies. This is Round 2 for Congress. Last year, it scrutinized and slowed other business deals with ties to China's government among oil companies and computer makers.

Rep. Chris Smith, R-N.J., is drafting a bill that would force Internet companies including Google, Yahoo and Microsoft to keep vital computer servers out of China and other nations the State Department deems repressive to human rights. Moving servers would keep personal data they house from government reach. But that also could weaken the firms' crucial Internet search engines. (Related: AOL tries to speak Chinese.)

Smith's bill — still being written — has already drawn interest from another lawmaker, Rep. Dana Rohrabacher, R-Calif., with long-held concerns about U.S. business cozying up to the Chinese government. "This is greed in high technology, and it's not a pretty sight," Rohrabacher says.

Smith has scheduled a Wednesday hearing on the issue, which Google, Microsoft, Yahoo and Cisco Systems will attend. He is unmoved by their stance that conducting business in China in limited ways will better nurture human rights than abandoning the nation of 1.3 billion altogether.

If anything, Smith says, China's human rights record has slipped, even as more U.S. companies pile into the country. "It's gotten worse," he says.

Google last month launched Google.cn, a version of its No. 1 search engine that prevents Chinese residents from seeing, for example, photos of tanks confronting Tiananmen Square protesters in 1989. Also last month, Microsoft acknowledged shutting down a blog run by a Chinese journalist critical of the government.

Last fall, Yahoo acknowledged giving information to Chinese officials that led to a 10-year prison sentence for a journalist accused of divulging state secrets. Last week, Reporters Without Borders, a journalism group critical of Yahoo's cooperation with Chinese officials, accused it of working with the Chinese government in another case that led to a dissident being jailed. Yahoo said it was unaware of the case.

The companies say they are unhappy with the restrictions yet must honor local laws.

Smith asked Cisco to attend because he wants to learn more about how its network hardware might be used outside the USA to help repressive governments ferret out dissidents.

Cisco says it does not cooperate with governments for such uses, though it notes the hardware "can be used for many different purposes."

Smith's bill would also establish codes of conduct for Internet companies operating in repressive regimes. It would set export controls for technology such as website filtering devices that can limit free speech. And it would create a State Department office to investigate suspected persecution of Internet users in foreign countries.

Smith, a member of Congress since 1981, is vice chairman of the Committee on International Relations, which oversees the State Department.

Smith's legislation isn't a slam-dunk. If it gets as far as a vote in the House, "every business interest" will jump in, says David Brady, a professor of political science at Stanford.

"It's not just a Yahoo issue," says Michael Callahan, a Yahoo attorney. "It's all international firms operating in China."

Google draws attention

Internet companies, like virtually every other business, are racing to China's sizzling economy. Its gross domestic product, the combined value of its goods and services, is expected to rocket 8.2% this year from 2005, vs. 3.3% growth in the USA, says the International Monetary Fund.

Google's China site launch drew more attention than steps taken by its rivals for reasons that have broadly made it into an inviting target.

The company's founders laid out a widely publicized "don't be evil" pledge when they took the company public. That set it up for even closer scrutiny, Brady says. And it gave critics of the China website an entrée. Soon after its launch, opponents of China's control of Tibet waved signs saying "Google Don't Be Evil" outside the company's headquarters in Silicon Valley's Mountain View, Calif.

Google's site launch came days after it rebuffed a U.S. Justice Department subpoena demanding that it turn over data on how millions of users search the Internet.

In contrast, Yahoo, Microsoft and America Online all cooperated with Justice.

Google's leadership in online search and its lofty stock price have generated worldwide headlines, transforming it into one of the globe's most powerful corporations. But now, amid the Justice subpoena, the China launch and investor angst about e-commerce prospects, Google shares have lost nearly 25% from their high. They closed Friday at $362.61, up $3.84 a share, after sprinting to a record $475.11 high last month.

Forced compromise

Google says its China site tackles problems Chinese users have with Google.com, which is unavailable about 10% of the time there. When working, it is often slow. The Google News service is rarely available, and Google Images — a storehouse that includes the Tiananmen Square photos — is down half the time.

Google blames those problems on the fact that its servers are now housed outside China, crimping response time as users reach sometimes thousands of miles to servers in the USA. Accepting government content limits meant Google could win a license to operate within China and locate servers there, says Senior Policy Counsel Andrew McLaughlin.

But it was a compromise. "We are not happy about government restrictions on access to information, and we hope that over time everyone in the world will come to enjoy full access," he told the Congressional Human Rights Caucus in a statement for a briefing earlier this month.

In any case, the company's uncensored Google.com will still be available to Chinese citizens.
http://www.usatoday.com/money/world/...hina-net_x.htm





In Rare Briefing, China Defends Internet Controls
Joseph Kahn

Chinese authorities are determined to stop "harmful information" from spreading through the Internet, but the controls it places on Web sites and Internet service providers in mainland China do not differ much from those employed by the United States and European countries, a senior Chinese official responsible for managing the Internet said today.

The official, Liu Zhengrong, who supervises Internet affairs for the information office of the Chinese State Council, or cabinet, did not dispute charges that China operates a technologically sophisticated firewall to protect the ruling Communist Party against what it treats as Web-based challenges from people inside China and abroad.

But he sought to place the massive Chinese efforts to control the Web in the best possible light, stressing repeatedly that Chinese Internet minders abide strictly by laws and regulations that in some cases have been modeled on American and European statutes.

"If you study the main international practices in this regard you will find that China is basically in compliance with the international norm," he said. "The main purposes and methods of implementing our laws are basically the same."

The briefing was one of the few times any senior official has spoken in detail about China's management of the Internet. Officials assigned to enforce the government's media controls operate behind closed doors and rarely make public statements about their work.

The Internet policies of China have come under closer scrutiny abroad after Google and Microsoft acknowledged helping China censor information available through Web searches and blogs, and Yahoo has been accused of providing data that helped convict dissidents who used its e-mail accounts.

Mr. Liu said the major thrust of the Chinese effort to regulate content on the Web was aimed at preventing the spread of pornography or other content harmful to teenagers and children. He said that its concerns in this area differ minimally from those in developed countries.

Human rights and media watchdog groups maintain that Chinese Web censorship puts greater emphasis on helping the ruling party maintain political control over its increasingly restive society. Such groups have demonstrated that many hundreds of Web sites cannot be easily accessed inside mainland China mainly because they are operated by governments, religious groups or political organizations that are critical of Chinese government policies or its political leaders.

Mr. Liu said that Chinese Internet users have free rein to discuss many politically sensitive topics and rejected charges that the police have arrested or prosecuted people for using the Internet to circulate views.

Human rights groups argue, and Chinese court documents show, however, that legal authorities have cited e-mail communications and postings on domestic and foreign Web sites as evidence against Chinese dissidents accused of "incitement to overthrow the state" and "leaking state secrets."

Mr. Liu objected to what he suggested were biased criticisms of Chinese Internet controls that ignored similar restrictions that foreign governments and private companies impose on their own Web sites.

He cited, for example, statements on Web sites run by The New York Times and The Washington Post that reserve the right to delete or block content in reader discussion groups that editors determine to be illegal, harmful or in bad taste. Chinese media Web sites are also monitored in that way, he said.

"Major U.S. companies do this and it is regarded as normal," Mr. Liu said. "So why should China not be entitled to do so?"

Journalists and Web site operators in China say that domestic news and discussion sites must ban a long list of topics deemed off limits by party officials or face penalties. Such controls appear to have only superficial similarities to attempts by private companies in the United States and Europe to monitor content on Web sites they operate.

Mr. Liu also said the powers that the Bush administrations gained under the Patriot Act to monitor Web sites and e-mail communications and the deployment of technology called Carnivore by the F.B.I., which allows it to scrutinize huge volumes of e-mail traffic, are examples of how the United States has taken legal steps to guard against the spread of "harmful information" online.

"It is clear that any country's legal authorities closely monitor the spread of illegal information," he said. "We have noted that the U.S. is doing a good job on this front."

The Bush administration has maintained that its efforts to monitor online communications pertain mainly to preventing terrorist attacks.

Mr. Liu said there are now 111 million Chinese Web users and that in the past five years, China has expanded the bandwidth available to connect with overseas Web sites nearly 50-fold to 136,000 megabits per second, underscoring its strong commitment to allow its citizens to gather information and interact with people around the world.

The number of Web sites that mainland Chinese users cannot access amounts to a "tiny percentage" of those available abroad, he said.'
http://nytimes.com/2006/02/14/intern... ner=homepage





China Denies Internet Controls Lead To Arrests

Chinese people can freely access the Internet and the government has never arrested anyone for expressing an opinion on the Web, an official state newspaper said on Wednesday. Chinese regulations were also in line with international practices and no different from rules in other countries like the United States which seek to block sites with harmful content, the China Daily said, quoting a senior Internet watchdog official.

"No one in China has been arrested simply because he or she said something on the Internet," Liu Zhengrong, vice head of the Internet Affairs Bureau of the State Council Information Office, was quoted as saying.

Several U.S. tech companies that operate in China have faced criticism in recent months for helping China enforce censorship laws and track down government critics who communicate online.

Microsoft Corp. pulled the Web log, or blog, of a critic of the Chinese government after getting a government order to do so, and Yahoo Inc. has been criticized for helping Chinese authorities link journalist Shi Tao to a U.S.-based Web site, leading to a 10-year prison sentence for Shi.

Liu defended China's record.

"After studying Internet legislation in the West, I've found we basically have identical legislative objectives and principles," he said.

"Companies, including Internet firms, that provide services in China must observe Chinese statutes," he added. "Global companies should know how to provide lawful services ... It is their own business when it comes to specific methods and approaches."

Liu said China blocked only "a very few" foreign sites which have pornographic or terrorist-linked content, or have other information that is in violation of Chinese law.

Google Inc.'s Chinese search engine, for example, blocks many terms associated with topics related to democracy or independence for Tibet, part of China, and Taiwan, a self-ruled island which China considers its own.

China encouraged people to report Web sites that contain "harmful information", Liu said, just as in countries such as Britain.

The government had imposed "lenient" penalties on sites that carry harmful or illegal information, and no Web sites had been shut down for abusing those rules, he added.

The U.S. State Department said on Tuesday it had set up a task force to help U.S. technology companies protect freedom of expression in countries like China that censor online content.

But some U.S. sites, like those of Yahoo, also imposed controls on what can be said online, Liu said.

"It is unfair and smacks of double standards when (they) criticize China for deleting illegal and harmful messages while it is legal for U.S. Web sites (to do so)", he said.
http://today.reuters.com/news/newsAr...HINA-MEDIA.xml





Beijing Censors Taken to Task in Party Circles
Joseph Kahn

A dozen former Communist Party officials and senior scholars, including a onetime secretary to Mao, a party propaganda chief and the retired bosses of some of the country's most powerful newspapers, have denounced the recent closing of a prominent news journal, helping to fuel a growing backlash against censorship.

A public letter issued by the prominent figures, dated Feb. 2 but circulated to journalists in Beijing on Tuesday, appeared to add momentum to a campaign by a few outspoken editors against micromanagement, personnel shuffles and an ever-expanding blacklist of banned topics imposed on China's newspapers, magazines, television stations and Web sites by the party's secretive Propaganda Department.

The letter criticized the department's order on Jan. 24 to shut down Freezing Point, a popular journal of news and opinion, as an example of "malignant management" and an "abuse of power" that violates China's constitutional guarantee of free speech.

The letter did not address Beijing's pressure on Web portals and search engines.

That issue gained attention abroad after Microsoft and Google acknowledged helping the government filter information and Yahoo was accused of providing information from its e-mail accounts that was used to jail dissident writers. The issue will be the subject of Congressional hearings in Washington on Wednesday.

In addition to shutting down Freezing Point, a weekly supplement to China Youth Daily, since late last year, officials responsible for managing the news media have replaced editors of three other publications that developed reputations for breaking news or exploring sensitive political and social issues.

The interventions amounted to the most extensive exertion of press control since President Hu Jintao assumed power three years ago.

But propaganda officials are also facing rare public challenges to their legal authority to take such actions, including a short strike and string of resignations at one newspaper and defiant open letters from two editors elsewhere who had been singled out for censure. Those protests have suggested that some people in China's increasingly market-driven media industry no longer fear the consequences of violating the party line.

The authors of the letter predicted that the country would have difficulty countering the recent surge of social unrest in the countryside unless it allowed the news media more leeway to expose problems that lead to violent protests.

"At the turning point in our history from a totalitarian to a constitutional system, depriving the public of freedom of speech will bring disaster for our social and political transition and give rise to group confrontation and social unrest," the letter said. "Experience has proved that allowing a free flow of ideas can improve stability and alleviate social problems."

Some of the signers held high official posts during the 1980's, when the political environment in China was becoming more open. Although they have long since retired or been eased from power, a collective letter from respected elder statesmen can often help mobilize opinion within the ruling party.

One of those people who signed the petition is Li Rui, Mao's secretary and biographer. Others include Hu Jiwei, a former editor of People's Daily, the party's leading official newspaper; Zhu Houze, who once ran the party's propaganda office; and Li Pu, a former deputy head of the New China News Agency, the main official press agency.

Party officials and political experts say President Hu, who was groomed to take over China's top posts for more than a decade, has often attended closely to the opinions of the party's elder statesmen.

Mr. Hu is widely thought to favor tighter media controls. Party officials said he referred approvingly to media management in Cuba and North Korea in a speech in late 2004.

But he has also solicited support from more liberal elements. Last year Mr. Hu organized high-profile official ceremonies to mark the 90th anniversary of the birth of Hu Yaobang, the reform-oriented party leader who lost his posts in a power struggle and whose death in 1989 was the initial cause of the student-led democracy demonstrations that year. Some of the officials who signed the petition were close associates of Hu Yaobang.

The reaction against the shutdown of Freezing Point was organized by its longtime editor, Li Datong, 53, a party member and senior official of the party-run China Youth Daily. Mr. Li broadcast news of the secret order on his personal blog moments after he received it and has since mobilized supporters to put pressure on the Propaganda Department to retract the decision.

Under his stewardship, Freezing Point became one of the most consistently provocative journals of news and public opinion. It published investigative articles on sensitive topics like the party's version of historical events, nationalism and the party-run education system. Freezing Point ran opinion articles on politics in Taiwan and rural unrest in mainland China that caused a stir in media circles in recent months.

The cause cited for closing Freezing Point was an opinion piece by a historian named Yuan Weishi. He argued that Chinese history textbooks tended to ignore mistakes and provocations by leaders of the Qing Dynasty that may have incited attacks by foreign powers in the late 19th century.

Mr. Li often tussled with his bosses at China Youth Daily and officials at the Propaganda Department. But he has also cultivated support among the party elite. He often speaks supportively of President Hu and quotes extensively from the writings of Marx, who he says favored a robust free press.

He has maintained that the Propaganda Department had overstepped its authority by ordering Freezing Point closed, and he filed a formal complaint to the party's disciplinary arm.

"The propaganda office is an illegal organization that has no power to shut down a publication," Mr. Li said in an interview. "Its power is informal, and it can only exercise it if people are afraid."

He added, "I am not afraid."

Mr. Li scored an initial victory last week, when propaganda officials told China Youth Daily to draft a plan to revive Freezing Point, which had been formally closed for "rectification," Mr. Li and another editor at the newspaper said. Some media experts had predicted that the authorities would not allow Freezing Point to reopen, and the new order was treated as a signal that officials had misjudged the reaction to its closing.

Shortly after the contretemps at China Youth Daily broke out, the former editor of another national publication attacked the bosses who had replaced him, saying they had exercised self-censorship in the face of pressure from propaganda officials.

Chen Jieren, who lost his position last week as the editor of Public Interest Times, posted a letter online entitled "Ridiculous Game, Despicable Intrigue." The letter disputed his bosses' statement that he had been dismissed for "bad management skills" and said he had a struggled constantly against senior officials for the right "to report the truth with a conscience."

One recent issue of Public Interest Times mocked the poor quality of English translations on official government Web sites.

In a separate incident earlier this year, a group of editors and reporters at the party-run Beijing News declined to report for work after the editor of the paper, known for breaking news stories on subjects the Propaganda Department has ruled off limits, was replaced. Many of the protesters have since resigned, reporters at the newspaper said.

The resistance against censorship could signal a decisive shift in China's news media controls, already under assault from the proliferation of e-mail, text messaging, Web sites, blogs and other new forums for news and opinion that the authorities have struggled to bring under their supervision.

Even most of the major party-run national publications in China, including China Youth Daily, no longer receive government subsidies and must depend mainly on income from circulation and advertising to survive.

That means providing more news or features that people want to pay for, including exclusive stories and provocative views that go well beyond the propaganda fare carried by the New China News Agency or People's Daily. Few serious publications survive for long without subsidies if they do not have popular content, editors say.

"Every serious publication in China faces tough choices," said Mr. Li of Freezing Point. "You can publish stories people want to read and risk offending the censors. Or you can publish only stories that the party wants published and risk going out of business."
http://www.nytimes.com/2006/02/15/in...a/15china.html





Outrunning China's Web Cops

Net-savvy outfits are finding ways to let citizens see banned sites
Ben Elgin, with Bruce Einhorn in Hong Kong

From an undisclosed location in North Carolina, Bill Xia is fighting a lonely war against China's censors. From morning till well into the night, the Chinese native plays a cat-and-mouse game, exploiting openings in Beijing's formidable Internet firewall and trying to keep ahead of the cybercops who patrol the Web 24-7 and have an uncanny ability to plug holes as quickly as Xia finds them. A member of the banned Chinese sect Falun Gong, Xia is so fearful that Beijing will persecute his family back in China, that he refused to be photographed for this story, reveal where exactly he was born, or even provide his age beyond saying he's in his 30s.

Xia is part of a small group of Chinese expatriates who are making a modest living helping Web surfers back home get the information their government would rather they not see. Chinese citizens hoping to read about the latest crackdown on, say, Falun Gong or the most recent peasant rebellion in the provinces can use technology provided by Xia's Dynamic Internet Technology Inc. to mask their travels to forbidden Web sites.

Voice of America (VOA) and human rights organizations also are paying DIT to help evade the censors and get their message out to the Chinese masses. Says Xiao Qiang, who teaches journalism at the University of California at Berkeley and runs the China Internet Project: "These tools have a critical impact because the people using them are journalists, writers, and opinion leaders."

So far, DIT, UltraReach, and other outfits like them have lured less than 1% of China's estimated 110 million Net users. But Google (GOOG ) decided in January to censor information inside China, a practice already followed by Microsoft (MSFT ) and Yahoo (YHOO )!, arguing that it's the only way the search engines can crack the Chinese market.

So Xia is convinced that the services he and others provide will become increasingly crucial to keep information flowing and, ultimately, he hopes, build an open society back home. "Once in a while I feel more homesick than usual," says Xia, who says he hasn't seen his family in seven years. "But it's such a great project, and it helps so many people."

The seeds of DIT were sown when Xia arrived in the U.S. for grad school in the '90s. Stunned by America's openness, he realized his perception of reality had been warped growing up in China. "I was a believer of the propaganda," he recalls. And when Xia was exposed to all of the information on the Internet, it "started tearing apart what I'd accepted before." At the same time, the repression of Falun Gong at home angered him, though he insists it is Beijing's curbs on free expression that led him to found DIT in 2001. A year later he began building up a roster of clients, including VOA, Human Rights in China (HRIC), and Radio Free Asia.

Fleeting Window

The simplicity of DIT's approach belies its effectiveness. The company distributes software, called FreeGate, which disguises the sites a person visits. In addition, DIT sends out mass e-mails to Chinese Web surfers for clients such as VOA, which is banned in China. The e-mails include a handful of temporary Web addresses that host off-limits content and springboards to other forbidden sites.

Keeping one step ahead of the censors is what this game is all about. China's cybercops are so efficient that these gateways typically stay open for only 72 hours, according to Ken Berman, an information technology director at the State Dept.-affiliated International Broadcasting Bureau, which hired DIT and UltraReach to help make VOA's Web content available in China.

Yet despite being outmanned and outspent -- Xia has a tiny staff, an annual budget of about $1 million, and relies mainly on volunteers -- DIT's customers say it has been remarkably successful. Xia's staff monitors the success rate of the hundreds of thousands of e-mails they send out each day. If one gets bounced back, the language must be scoured and the offending words detected and added to the company's blacklist. Workarounds are often developed, much like spammers finding holes in a corporate e-mail filter. For instance, an e-mail that contains "VOA" might get squelched, but one with a zero substituted for the "O" could get through.

As Google and other U.S. search companies increasingly cooperate with Beijing, DIT is helping the groups like HRIC break through the firewall. Before Google began censoring its results in China in January, HRIC appeared in the top three search results. Although China's Google users would have had difficulty accessing the HRIC sites, which are blocked, they at least knew they existed. Today they don't appear at all in China. But thanks to DIT and others, visitors to its Chinese-language newsletter spiked to more than 160,000 in January, up sixfold in the past 18 months. Says Xia: "If information isn't available on the Internet, it might as well not exist."

Every time something momentous happens in China -- and Beijing smothers news about it -- more people use his software, Xia says. In 2003, when the SARS epidemic peaked and Chinese authorities seemed to be withholding information, the number of DIT users spiked by 50%, he says -- and they doubled after reports surfaced in December that Guangdong police had shot protesting villagers.

Such moments invigorate Xia, making the effort worthwhile. And by the looks of things, the services he and his peers provide will be in demand for quite a while to come.
http://www.businessweek.com/magazine...8/b3972061.htm





Scaling The Firewall Of Digital Censorship
Oliver Moore

More than fifteen years after the Berlin Wall was shattered with hammers and bulldozers, a Canadian-designed computer program is preparing to break through what activists call the great firewall of China.

The program, in the late stages of development in a University of Toronto office, is designed to help those trapped behind the blocking and filtering systems set up by restrictive governments. If successful, it will equip volunteers in more open countries to help those on the other side of digital barriers, allowing a free flow of information and news into and out of even the most closed societies.

The program is part of a quiet war over freedom of information. Even as countries considered repressive, such as China, North Korea, Iran and Saudi Arabia, pour money into stopping the free exchange of data, small groups of activists keep looking for ways around the technological barriers.

At the University of Toronto, in the small basement office of Citizen Lab, researchers are getting ready for the release of Psiphon, the latest weapon in the fight.

"I was always interested in the idea of using computers for social and political change," said Nart Villeneuve, who has been dabbling with the project for about two years. "It was a matter of creating a program for really non-technical people that was easy and effective."

Psiphon is designed to eliminate a drawback of anti-filter programs: incriminating the users behind the firewall. If found by authorities, that anti- filter software can lead to coercive interrogation, a bid to uncover the suspect's Internet travel secrets using a tactic known to insiders as "rubber- hose cryptoanalysis."

Mr. Villeneuve built a system that won't leave dangerous footprints on computers. In simple terms, it works by giving monitored computer users a way to send an encrypted request for information to a computer located in a secure country. That computer finds the information and sends it back, also encrypted.

An elegant wrinkle is that the data will enter users' machines through computer port 443. Relied on for the secure transfer of data, this port is the one through whichreams of financial data stream constantly around the world.

"Unless a country wanted to cut off all connections for any financial transactions they wouldn't be able to cut off these transmissions," said Professor Ronald Deibert, the director of Citizen Lab.

A drawback to Psiphon is that the person behind the firewall has to be given a user name and password by the person offering up the computer. With this kind of setup, Mr. Villeneuve said, activists may end up working with specific dissidents and people in repressive countries may rely on relatives abroad to help them get connected. Canadians, with ties to every country in the world, are in a particularly good position to use such a system.

Although this reduces the program's reach, a relationship-based system could also minimize improper use. People who know the owner of their proxy computer are less likely to abuse their system, the logic goes.

"The big novel thing here is that you have a one-to-one connection," said Danny O'Brien, activism co-ordinator at the Electronic Frontier Foundation, a San Francisco-based group. "That's a great innovation, because so many people have computers that are always on, and this lets you deal with someone you can trust."

If the remote user begins to view illegal material, their access can be limited in several ways, such as allowing access to text only. In extreme cases, Mr. Villeneuve said, people found with evidence of illegal activity on their computer would be able to prove through forensic analysis that it had been done by the remote user.

The team at Citizen Lab is now racing to put the final touches on the program in time for its public debut at the international congress of the free-speech group PEN in May. Billed as a uniquely Canadian approach to "hactivism," the first generation of Psiphon will then be made publicly available.

Its release is set to come against a backdrop of ever-diminishing free access to the Internet. Just last month the popular search engine Google agreed to self-censor, restricting access to certain content and websites in order to gain access to the Chinese market.

Sharon Hom, executive director of Human Rights in China, an international NGO, said the country has managed to create "a culture of fear and self- censorship." They are helped, she added, by Western countries willing to sell Internet-monitoring equipment to Beijing and bend to its terms.

Mr. O'Brien noted that public knowledge of monitoring can have as major an effect as the surveillance itself.

"You don't need to arrest every dissident and you don't need to take down every website. You just need to give the impression that you're watching," he said. "Merely establishing that you are being watched has a great effect on freedom of expression."

Activist groups around the world work to shine a spotlight on such repression, hoping that publicity and pressure will bring about change.

Although Psiphon is a purely Citizen Lab project, Prof. Deibert's team is also part of the Open Net Initiative. It's a partnership that includes Harvard and Cambridge universities and tries to document the extent of state interference on the Internet.

In Prof. Deibert's words, they try "to turn the tables on the watchers, to watch the watchers."
http://www.theglobeandmail.com/servl...y/Technology//





Livedoor Founder Is Charged With Securities Violations
Martin Fackler

Takafumi Horie, the founder of an Internet company whose brash tactics challenged Japan's business establishment, was charged Monday with violating securities law by spreading false information to inflate a subsidiary's stock price.

The formal filing of charges by Tokyo prosecutors marked the latest chapter in the downfall of Mr. Horie, 33, who seemed to personify the bare-knuckles, individualistic brand of capitalism that many here say Japan needs.

In a statement on Monday, Tokyo prosecutors said they had charged Mr. Horie and three other former executives of his company, Livedoor, with inflating the sales and profit figures of a subsidiary, Livedoor Marketing, to push up its stock price. Prosecutors also said that Mr. Horie and the others had issued press releases containing false information about the subsidiary, which was called ValueClick Japan until Livedoor took it over two years ago.

If found guilty, Mr. Horie faces up to five years in prison or a fine of five million yen ($42,300).

"The key to Livedoor's rapid growth was actually criminal activities that damaged the fairness of securities trading," the statement said.

"This case is just the tip of the iceberg," it continued. "We will continue a thorough investigation to bring everything to light."

Though prosecutors did not elaborate Monday, the major Japanese news media, who are routinely briefed by prosecutors, said the authorities were preparing new charges against Mr. Horie for reportedly inflating the profits of the parent company, Livedoor, as well.

Mr. Horie resigned as chief executive of Livedoor after his arrest on Jan. 23.

Since then he has been in jail, insisting, during interrogations running as long as eight hours a day, that he was unaware of any wrongdoing and vowing to have his say in court, according to Japanese news media reports.

He reportedly spends his free time in a tiny cell reading an encyclopedia.

Since Tokyo prosecutors raided Livedoor's luxurious central Tokyo offices last month, Mr. Horie's business empire has started coming apart at the seams.

Livedoor's share price has plunged 90 percent, to 61 yen (52 cents), since then, wiping out more than $5 billion in market value. Business partners have canceled alliances, employees have begun jumping ship and, according to media reports, Mr. Horie's girlfriend, a television star, has canceled plans to become engaged.

The T-shirt-clad entrepreneur built the company over the last decade, turning a college project into one of Japan's most popular Internet portals and acquiring dozens of smaller Internet companies. Along the way, though, he stepped on many influential toes, especially last year, when he tried a hostile takeover of a powerful media company, Fuji Television.

After the raid, some outraged followers posted messages on Mr. Horie's blog saying he was singled out for political reasons.

Others expressed bitter disappointment for believing in a man now accused of criminal misdeeds.
http://www.nytimes.com/2006/02/14/bu...4livedoor.html





Spyware Barely Touches Firefox
Gregg Keizer

Internet Explorer users can be as much as 21 times more likely to end up with a spyware- infected PC than people who go online with Mozilla's Firefox browser, academic researchers from Microsoft's backyard said in a recently published paper.

"We can't say whether Firefox is a safer browser or not," said Henry Levy, one of the two University of Washington professors who, along with a pair of graduate students, created Web crawlers to scour the Internet for spyware in several 2005 forays. "But we can say that users will have a safer experience [surfing] with Firefox."

In May and October, Levy and colleague Steven Gribble sent their crawlers to 45,000 Web sites, cataloged the executable files found, and tested malicious sites' effectiveness by exposing unpatched versions of Internet Explorer and Firefox to "drive-by downloads." That's the term for the hacker practice of using browser vulnerabilities to install software, sometimes surreptitiously, sometimes not.

"We can't say IE is any less safe," explained Levy, "because we choose to use an unpatched version [of each browser.] We were trying to understand the number of [spyware] threats, so if we used unpatched browsers then we would see more threats."

Levy and Gribble, along with graduate students Alexander Moshchuk and Tanya Bragin, set up IE in two configurations -- one where it behaved as if the user had given permission for all downloads, the other as if the user refused all download permission -- to track the number of successful spyware installations.

During Levy's and Gribble's most recent crawl of October 2005, 1.6 percent of the domains infected the first IE configuration, the one mimicking a na�ve user blithely clicking 'Yes;' about a third as many domains (0.6 percent) did drive-by downloads by planting spyware even when the user rejected the installations.

"These numbers may not sound like much," said Gribble, "but consider the number of domains on the Web."

"You definitely want to have all the patches [installed] for Internet Explorer," added Levy.

In the same kind of configurations, Firefox survived relatively unscathed. Only .09 percent of domains infected the Mozilla Corp. browser when it was set, like IE, to act as if the user clicked through security dialogs; no domain managed to infect the Firefox-equipped PC in a drive-by download attack.

Compare those figures, and it seems that IE users who haven't patched their browser are 21 times more likely to have a spyware attack executed -- if not necessarily succeed -- against their machine.

Most of the exploits that leveraged IE vulnerabilities to plant spyware were based on ActiveX and JavaScript, said Gribble. Those two technologies have taken the blame for many of IE problems. In fact, Firefox boosters often point to their browser's lack of support for ActiveX as a big reason why its security claims are legit.

Levy and Gribble didn't set out to verify that, but they did note that the few successful spyware attacks on Firefox were made by Java applets; all, however, required the user's consent to succeed.

Microsoft's made a point to stress that Internet Explorer 7, which just went into open beta for Windows XP, tightens up ActiveX controls by disabling nearly all those already installed. IE 7 then alerts the user and requires consent before it will run an in-place control.

Good thing, because one of the research's most startling conclusions was the number of spyware-infected sites. One out of every 20 executable files on Web sites is spyware, and 1 in 25 domains contain at least one piece of spyware waiting for victims.

"If these numbers are even close to representative for Web sites frequented by users," the paper concluded, "it is not surprising that spyware continues to be of major concern."

The moral, said Levy, is: "If you browse, you're eventually going to get hit with a spyware attack."
http://news.yahoo.com/s/cmp/20060210/tc_cmp/179102616





Microsoft Warns Of "Critical" Security Flaws

Microsoft Corp. on Tuesday warned of two "critical" security flaws that could allow attackers to use its media player or Internet Explorer Webbrowser to possibly take control of a computer.

Microsoft, the world's top software company whose Windows operating system runs on 90 percent of the world's computers, issued patches to fix the problems as part of its monthly security bulletin. It listed both as critical vulnerabilities.

One flaw is a vulnerability in some versions of the Windows Media Player for playing music or video files. The flaw makes it possible for an attacker to use a malicious file that controls the appearance of the player to launch other programs on a computer.

"Application vulnerabilities, such as the issue in Windows Media Player, are a growing cause of concern," Oliver Friedrichs, a senior manager at Symantec Corp., a leading maker of security software, said in a statement.

Another vulnerability in some versions of Internet Explorer would make it possible for an attacker to take total control of a PC.

Last month, Microsoft issued fixes for two security flaws in Windows that could let an attacker commandeer someone's computer.

Microsoft has been working for more than three years to improve the security and reliability of its software as more and more malicious software targets weaknesses in Windows and other Microsoft software.

The latest patches can be downloaded at www.microsoft.com/security.
http://today.reuters.com/news/newsAr...T-SECURITY.xml





Backdoor to Billy

UK Holds Microsoft Security Talks
Ollie Stone-Lee

UK officials are talking to Microsoft over fears the new version of Windows could make it harder for police to read suspects' computer files.

Windows Vista is due to be rolled out later this year. Cambridge academic Ross Anderson told MPs it would mean more computer files being encrypted.

He urged the government to look at establishing "back door" ways of getting around encryptions.

The Home Office later told the BBC News website it is in talks with Microsoft.

Unlicensed music

Professor Anderson, professor of security engineering at Cambridge University, was giving evidence to the Commons home affairs select committee about time limits on holding terrorism suspects without charge.

He said: "From later this year, the encryption landscape is going to change with the release of Microsoft Vista."

The system uses BitLocker Drive Encryption which can be linked to a chip called TPM (Trusted Platform Module) in the computer's motherboard.

The system is aimed at preventing tampering with computers but it would also help prevent people from downloading unlicensed films or media.

"This means that by default your hard disk is encrypted by using a key that you cannot physically get at...

"An unfortunate side effect from law enforcement is it would be technically fairly seriously difficult to dig encrypted material out of the system if it has been set up competently."

Guessing passwords

Professor Anderson said people were discussing the idea of making computer vendors ensure "back door keys" to encrypted material were made available.

The Home Office should enter talks with Microsoft now rather than when the system is introduced, he said.

He said encryption tools generally were either good or useless.

"If they are good, you either guess the password or give up," he said.

The committee heard that suspects could claim to have lost their encryption key - although juries could decide to let this count this against them in the same way as refusing to answer questions in a police interview.

A Home Office spokesman said: "The Home Office has already been in touch with Microsoft concerning this matter and is working closely with them."

Increased awareness about high-tech crime and computer crime has prompted the Home Office to talk to IT companies regularly about new software.

Government officials look at the security of new systems, whether they are easy for the general public to hack into and how the police can access material in them.

Preventing tampering

A Microsoft spokeswoman said Windows Vista was designed to be the most secure version of Windows yet.

She said: "It is our goal to give PC users the control and confidence they need so they can continue to get the most out of their PCs.

"At the same time, we are working with law enforcement to help them understand its security features and will continue to partner with governments, law enforcement and industry to help make the internet a safer place to learn and communicate."

The system, part of what is called "trusted computing" mechanisms, is designed to stop malicious programs being installed surreptitiously on computers.

The Trusted Computing Group has been working for some years on a hardware-based system which is built into the motherboards of many Intel- based computers.

But most people will not be able to use its features until Microsoft Windows Vista is launched.

Critics say the companies behind most trusted computing want to use digital rights management to ensure users cannot use programs they have not approved.
http://news.bbc.co.uk/go/pr/fr/-/1/h...cs/4713018.stm





Microsoft Anti-Spyware Deleting Norton Anti-Virus
Brian Krebs

Microsoft's Anti-Spyware program is causing troubles for people who also use Symantec's Norton Anti-Virus software; apparently, a recent update to Microsoft's anti-spyware application flags Norton as a password-stealing program and prompts users to remove it.

According to several different support threads over at Microsoft's user groups forum, the latest definitions file from Microsoft "(version 5805, 5807) detects Symantec Antivirus files as PWS.Bancos.A (Password Stealer)."

When Microsoft Anti-Spyware users remove the flagged Norton file as prompted, Symantec's product gets corrupted and no longer protects the user's machine. The Norton user then has to go through the Windows registry and delete multiple entries (registry editing is always a dicey affair that can quickly hose a system if the user doesn't know what he or she is doing) so that the program can be completely removed and re-installed.

I put in calls to Microsoft and to Symantec on this issue, but am still waiting to hear back from both companies.

Microsoft said it is shipping updates that fix this problem, but judging from the growing number of other threads on this in that forum, this is shaping up to be a pretty big issue for companies that have deployed Microsoft's free anti-spyware product inside their networks. It's a good idea to keep in mind that Microsoft's Anti-Spyware product is in beta mode: The company's product page explicitly says that Microsoft Anti-Spyware should not be deployed in production systems. I'm not apologizing for Redmond in any way; it just seems like too many people ignore warnings about beta products.
http://blog.washingtonpost.com/secur...eleting_1.html





Does Mac Have Potential For Hacker Attacks?
Thomas Zizzo

The Apple Macintosh enjoys a reputation as one of the more secure systems out there, but the recent discovery of vulnerabilities in two of Apple’s most popular applications serves as a reminder that no Internet user is immune to attacks.

In January, four critical security vulnerabilities were discovered in the Apple QuickTime and iTunes applications, raising security concerns over the increasingly popular media player formats.

Solution providers said customers need to be aware of the risks these applications might bring, but expressed faith that Mac OS X remains secure, at least for now.

The Mac generally is called a platform that is secure from exploits and viruses in part because the user base of Macs is very small compared with that of the Windows PC, making the Mac community a less attractive target.

Not everyone sees it that way, however.

“I really think that is a misnomer,” said Ian Blanton, director of consulting for Tech Superpowers, an Apple solution provider in Boston.

Blanton said viruses can reach any system connected to the Internet, regardless of the operating system. And the fact that there has not been a known, live virus that has successfully propagated through the Mac OS X poses a challenge that could be too good for some hackers to pass up, he added.

“That makes Macs an even bigger target,” he said.

Vulnerabilities affecting QuickTime and iTunes for Mac OS X 10.3.9 and Windows XP were recently discovered by end-point security vendor eEye Digital Security. The vulnerabilities could allow a remote attacker to overwrite heap memory in QuickTime and iTunes files, causing the computer to crash and enabling the attacker to execute code that controls certain commands. Someone looking to exploit these vulnerabilities would have to convince a potential victim to click on a link sent via e-mail. Apple responded by quickly sending out a patch, but the discovery has raised questions regarding the long-standing notion that Macs are impervious to security exploits.

An Apple spokesperson did not formally comment on the vulnerabilities but said the company’s Web site provides information on OS 10 security.

The concern is that since iTunes and QuickTime are becoming increasingly popular, those applications could become attractive targets for potential exploits, said Steve Manzuik, security product manager for eEye, Aliso Viejo, Calif. (Apple said it has sold 500 million iTunes downloads and more than 40 million iPods.) Plus, the applications are difficult for IT departments to manage since they easily can be downloaded for free, he said.

“The potential is there. We haven’t seen any exploitation, but it doesn’t mean it can’t be done,” Manzuik said.

Apple’s VAR partners aren’t too concerned at this point about exploits, viruses or worms being spread on Macs, but they agree that security shouldn’t be ignored. “It’s always a concern,” said Alberto Palacios, president of Create More, San Francisco.

It’s easy to write a virus for the Mac; the difficult thing is making it propagate, Palacios said. Anytime an application is installed on a Mac, several pop-up windows will ask the user if they are sure they want to install and run the program. Unless a hacker physically has access to the computer, it’s almost impossible to unknowingly infect it with a virus, he said.

But given the growing popularity of iPods and iTunes, the threat for an industrious hacker to be the first to hack a Mac is real, Palacios said. “I do believe [Mac] is becoming a bigger target,” he said.

Apple takes security very seriously, said George Swords, marketing manager for PowerMacPac, an Apple reseller in Portland, Ore. Mac users should always have the latest software updates installed, and antivirus security software should be used to guard against forwarding infected e-mails to friends that have PCs, he said.

The Mac also comes with its security defaults activated, unlike a Windows PC, which requires security features to be turned on, according to Swords. “Out of the box, everything is locked down on a Mac,” he said.

The likelihood of a live virus spreading through Macs is small, and hopefully it will never happen, he said. “I don’t ever want to see that in the press,” Swords said.
http://www.crn.com/sections/security...leId=179101530





Mommy, Help Me Download 'Farmer in the Dell' to My MP3 Player
Michael Barbaro

As digital electronics have invaded Toyland, putting video projectors and cellphones into the hands of 7- year-olds, companies that cater to preschoolers have deliberately sat on the sidelines, determined to hold up the wall between adult technology and children's play.

But the wall is about to come crashing down.

At least that is how it will look from the floor of the America International Toy Fair, the industry's biggest annual trade show in the United States, which begins tomorrow at the Jacob K. Javits Convention Center in Manhattan.

Fisher-Price, synonymous with Elmo and Power Wheels, will introduce a digital music player and digital camera for children ages 3 and older that will be sold during the 2006 holiday season.

Tek Nek Toys will show off a small digital music player with built-in speakers and flashing lights, called CoolP3 Fusion, for children 4 and up. Emerson Radio will introduce a SpongeBob SquarePants speaker system for MP3 players and SpongeBob SquarePants digital camera.

In perhaps the most extreme example of the trend, a company called Baby Einstein will introduce a baby rocker with an MP3 adapter and speakers.

But proponents of traditional make-believe play, who objected last year when toy companies marketed digital electronics to "tweens" — children 8 through 12 — are expected to protest even more loudly when they are advertised to toddlers.

"This is a big leap," said Reyne Rice, a toy trends specialists for the Toy Industry Association. "A 3-year-old with a digital camera is unusual."

But the financial incentive to develop the technology has grown. Children's electronics have proved to be a bright spot in an otherwise slumping toy industry.

From 2003 to 2005, sales of children's electronics rose 3 percent, to $600 million, according to the NPD Group, a market research firm.

No wonder, perhaps, that last year Hasbro introduced a digital video camera for children ages 8 and older and Disney introduced an MP3 player for children as young as 6.

Executives at Fisher-Price, a division of Mattel, said the company's MP3 player and digital camera, both priced at $70, are specifically designed for young children, with a rugged design that can survive repeated four-foot drops and big easy-to-use buttons that simplify the technology.

The Kid-Tough Digital Camera, for example, has two view finders — much like a pair of binoculars — rather the single window found on the adult version; two large handles to steady it before shooting a picture; and a two-step process for deleting unwanted pictures verses the four- or five-step version on a typical camera.

Because not all preschoolers can read a song title before hitting the play button, the Digital Song and Story Player relies on easily recognizable icons to symbolize each song, like a star for "Twinkle, Twinkle Little Star" or a barn for "Old McDonald."

Both products take a minimalist approach. The digital camera has only five buttons. "We analyzed what kids did with these products and what appealed to them and threw out what they didn't need," said David Ciganko, vice president for product design at Fisher-Price.

Company executives said the digital camera and music player promote creative expression — like snapping a photo of family members, or, perhaps given the age of the photographers, stuffed animals, or learning the words to a children's song.

Lisa Mancuso, vice president for marketing at Fisher-Price, said that with the camera "there is a sense of accomplishment, of 'Mommy, look what I did.' "

With both technologies, however, it is mommy and daddy who will have to do some of the accomplishing. A parent's help is required to download new songs on the digital music player and upload photos to a computer before printing. Fisher-Price said it has developed easy-to-use software that makes the setup fairly simple.

Independent toy analysts expressed concern about the products. Marianne Szymanski, creator of Toy Tips, a research firm based in Milwaukee, said that for the most part digital electronics promote a solitary pattern of play, for example, a child sitting alone listening to music on headphones.

"I am not saying tech is bad, but we need toys that encourage social interaction in the preschool years, not those that don't," she said.

For now, Fisher-Price's rival at Hasbro, Playskool, is steering clear of digital electronics for preschoolers. Lorrie Browning, general manager of infant and preschool toys at Hasbro, said Playskool was using electronics — but inside traditional toys like a new teddy bear, T. J. Bearytales, that gestures while it tells stories.

"What we are hearing more and more from parents," she said, "is that it's really important that children not lose the key basic building blocks for their development."
http://www.nytimes.com/2006/02/11/te...gy/11toys.html





As an Alternative to a Trip to a Video Store, Movies Through a Set-Top Box
Saul Hansell

Will people pay $230 and hook a new gizmo up to their television sets so they do not have to drive to the video rental store?

That is the question to be answered by MovieBeam, a service being introduced in 29 major markets today. The service was originally developed and tested in three cities in 2004 by the Walt Disney Company. Disney has brought in new investors and streamlined the service's pricing to offer it on a broader scale.

MovieBeam is built around a technology that broadcasts movies slowly over unused portions of the television signals to set-top boxes that store them on a hard disk. Users will have a choice of 100 movies — mainly those that have been recently released on DVD's — with 10 new titles replacing old ones each week.

Consumers will buy the MovieBeam box for $250 from electronics stores. They can send for a $50 rebate, but must also pay a $30 activation fee, making the effective upfront cost $230. The service does not charge a monthly fee, but movies cost $3.99 each for current titles and $1.99 for older ones. (The company will also offer some movies in a high-definition format for an additional $1.) The customers will be able to watch the movie for a 24-hour period.

Tres Izzard, a former Disney executive who is now the chief executive of MovieBeam, said the service was meant to appeal to the 30 million people who rent at least four movies a month. Four-fifths of those rentals, he said, are releases of the sort that will be in the MovieBeam service.

"The hard drive is the back wall at a Blockbuster," Mr. Izzard said. He said that the service would allow customers to rent those films without driving or waiting for DVD's to come in the mail, as they do with services like Netflix.

Michael Gartenberg, an analyst with Jupiter Research, said he was skeptical that people would pay more than $200 for a box from MovieBeam, plus a fee per movie, when cable systems are offering movies on demand at similar prices through their digital services.

"The pricing model seems to be somewhat questionable here," he said. "People will ask why they need to spend that much money for a box."

Mr. Izzard argued that digital cable reaches only a minority of cable households and that MovieBeam might be more economical to viewers who like movies but do not want the other channels offered by cable systems. The service does not have to appeal to everyone, he said; it will break even if it attracts 500,000 customers. The company will sell the boxes at a slight loss.

Disney sold a majority of MovieBeam for $48.5 million to a group of investors including Cisco Systems, Intel and several venture capital funds. The MovieBeam box will be sold under Cisco's Linksys brand name.

The major studios have agreed to provide movies to the service, except Sony, with which negotiations are continuing, Mr. Izzard said. Disney's studios will make movies available on the service on the same day they are released on DVD. The other studios will make them available several weeks later when they are released to video-on- demand services offered by cable systems and Internet rental services like Movielink.

As with other video-on-demand services, most of the rental fee is paid to the studios. Still, studios have been wary about the expansion of video-on-demand services because they could eat into DVD sales, the most-profitable form of movie distribution.

Mr. Izzard said that with MovieBeam's broadcast system, the cost of delivering a movie was negligible. In contrast, industry executives say sending a movie over the Internet typically costs 50 to 75 cents for a transmission.
http://www.nytimes.com/2006/02/14/bu...a/14movie.html





Fakin' It: A Marketer Intends to Tease Consumers
Julie Bosman

EVEN among the countless bits of gimmickry taking up space on the Internet, the ads for Pherotones did look a little fake.

"Can my ring tones make you sexy?" read one ad posted last month on the Hollywood gossip blog Egotastic.com, depicting a red-haired doctor in a white lab coat. "Experience the ring tone secret I discovered in Denmark that's too hot for mainstream science," the ad promised, directing visitors to a Web site, pherotones.com. There, users could download special cellphone ring tones that, when played, were supposed to attract the opposite sex.

But rather than the revolutionary product that Pherotones promised, the ads were the beginning of a buzz marketing campaign under the guise of a fake product (Pherotones) and a fake doctor (Dr. Myra Vanderhood) with a fake Web site (Pherotones.com), all for a real client with less than $250,000 to spend.

The real client is Oasys Mobile, a little-known cellphone content provider that sells games, cellphone wallpaper and ring tones that can be downloaded. Oasys, based in Raleigh, N.C., enlisted the advertising firm McKinney & Silver, in Durham, N.C., to introduce its brand inexpensively — with a nontraditional campaign that it hoped would grab the attention of its desired 18-to-24-year-old demographic.

"You have a brand that nobody knows what it is and you have a consumer that's very specific," said David Baldwin, the executive creative director at McKinney, a unit of Havas. "They don't engage in traditional marketing. But they live online and they live with their cellphones."

So McKinney manufactured the idea of Pherotones, enlisting an actress to play the part of Dr. Vanderhood, the fictional Danish spokeswoman pictured in the ads for Pherotones.

McKinney also hired the Viral Factory, an agency in London that specializes in viral campaigns, to create a video that they hoped would spread around the Web. The video features a mock wedding ceremony where the ring tone on a male guest's cellphone compels the groom to run from the altar and passionately embrace the stunned guest. (So far, the video has been downloaded about 3,000 times on Web sites like YouTube, Punchbaby and Kontraband.)

In mid-December, McKinney placed a Pherotone entry on Wikipedia, the online encyclopedia that is written and updated by thousands of anonymous Web users. It was taken down after a month when Wikipedia discovered that it happened to be untrue.

But the overall campaign is garnering interest: after placing ads on blogs like Gawker and Defamer, Pherotones.com is now averaging 10,000 page views a day. Last week on Technorati, a Web site that tracks blogs, Pherotones.com was in the top 10 percent of the most popular blogs worldwide. It has also attracted attention on insider blogs like AdRants, a Web site that closely tracks the advertising industry.

The campaign has also revived a question that is routinely asked in the advertising industry: is it acceptable to use advertising to trick consumers?

One recent study has indicated that the buying public is willing to be fooled. A study by Northeastern University released last month found that even when participants who pitch products in word-of-mouth campaigns identify their commercial affiliations, it usually does not affect consumers' willingness to pass the marketing message on.

And the planners of buzz marketing campaigns often say that in order to reach the modern multitasking consumer — who may be simultaneously watching television, talking on a cellphone, reading the Internet and sending instant messages — advertising must be a two-way conversation to have an effect.

"The consumers in that target demographic do not want in-your-face marketing," said Gary Ban, the chief executive for Oasys Mobile. "We wanted something that was risqué, funny and something that involves the consumer. If you're doing something that they can identify with, that they can participate in, that's basically something that that generation can tune into."

Nearly 80 percent of marketers spend money on buzz marketing, said Marian Salzman, the executive vice president of JWT (and the trend-spotter responsible for spreading the term "metrosexual" to the masses). And the buzz marketing business is gaining financial muscle: the trade publication Advertising Age estimated that buzz marketing annually is a $100 million to $150 million industry.

The advertising industry has taken note of the power of buzz and viral marketing, which are loosely defined as efforts that encourage consumers to spread marketing messages to each other. A Burger King spoof on the Internet in 2004, for example, centered on a subservient man in a chicken suit, has collected more than 17 million unique visitors, said a spokesman for Crispin Porter & Bogusky, the agency that created the ad.

In 2004, Volvo ran ads in European car magazines claiming that 32 people in Dalaro, a small village in Sweden, all bought Volvo S40 sedans on a single day — more than the local Volvo dealer would typically sell in a year. A short video posted on the town and the "sale" on Volvo's Web site became an Internet cult phenomenon in Europe, with more than 400,000 people visiting the Web site in the first six weeks. The Mystery of Dalaro campaign resulted in impressive sales figures; in the first half of 2004, Volvo sold double the number of S40's it had sold in the first half of 2003.

But how does a company judge the effectiveness of the campaign? The same way any other ad campaign is assessed, Ms. Salzman said.

"I think you measure it first in brand momentum and then in sales," Ms. Salzman said. "Is it building in brand velocity and then are sales following?"

Now Oasys will be able to test the campaign's effect on sales: starting today, the Pherotones Web site is revealing its client by directing visitors to Oasysmobile.com.

Raising the ire of people who initially believed in the power of Pherotones is simply a negative consequence of the whole effort, said Mr. Ban of Oasys Mobile.

"You run the risk in any campaign like this that you might offend somebody," he said. "But even if you offend somebody, it seems to spread the gospel of the campaign."
http://www.nytimes.com/2006/02/16/bu...dco.html?8hpib





What's Online

A Rant. All 406 Pages of It.
Dan Mitchell

A NEW e-book tells a "sordid story" of business fraud, according to one reviewer. The book's author says it is "the largest fraud case in American history."

Enron? WorldCom? No. It's much, much larger than either of those, though the use of the word "fraud" in this case is more a literary device than a legal definition. The book is "The $200 Billion Broadband Scandal" (newnetworks.com). The author is Bruce Kushnick, a longtime irritant to the telecommunications industry.

His targets are the Baby Bells, which he contends owe every American household about $2,000 because they reneged on their collective promise to deploy ultra-high- speed broadband Internet access via optical fiber to millions of homes.

By now, according to Mr. Kushnick, 86 million homes should be wired at 45 Mbps — at least 15 times as fast as the best commonly available D.S.L. service. The count of homes wired at that speed so far is zero.

The phone companies made this promise as Congress was getting ready to pass the 1996 Telecommunications Reform Act, he points out. In return, they received benefits — including tax breaks and changes in state laws lifting limits on their profits — amounting to more than $200 billion, Mr. Kushnick writes. But instead of building the infrastructure, they spent money on more immediately profitable services like plain old copper-wire D.S.L. and hoary long-distance networks, according to the 406-page e-book.

"It's like ordering a Ferrari and getting a bicycle," Mr. Kushnick writes in his introduction.

Meanwhile, countries like South Korea and Japan were building out their infrastructure and making 100 Mbps service their national standard.

And here at home, "this 'bait and switch' caused a ripple effect," writes Steve Stroh, a research analyst, in a blog at bwianews.com.

"While one can argue about the dimensions of that ripple effect," he writes, "some effects are obvious — the cable companies only had to offer a modest speed increase above D.S.L. to be competitive. It seems reasonable to think that cable-modem speeds would be much higher in trying to compete with fiber, or the prices much lower."

ELSEWHERE IN TELCOLAND For years, David Lazarus, a business columnist for The San Francisco Chronicle, has been nipping at the heels of SBC (now called AT&T), offering a steady stream of caustic criticism, often from a consumer point of view. John Battelle, journalist and proprietor of Seachblog (battellemedia.com), reports that AT&T has had enough, and has pulled its $5 million annual ad purchase from the newspaper.

The move, Mr. Battelle writes, is "misguided."

"After all, negative press is still press, and it's an opportunity to respond, to learn, to grow, to do better. Even if you disagree with the press, at least take the time to engage in a conversation."

A company representative told him, "our marketing strategy and media buying plans are proprietary," and declined to comment further.

And why is this in a blog about search engines? Mr. Battelle writes: "Because this is your new competitor, Google. Get to know them. As you offer free Wi-Fi to all of San Francisco (and, one might argue, the rest of the country/world), and undermine AT&T/SBC's broadband business, hardball players like SBC are going to go after you.' "

ONLINE SITCOM "Powerloafing With Cubicle Carl" (powerloafing.com) probably won't make NBC's prime-time lineup, but the online sitcom does, appropriately enough, make for an amusing workday diversion. The show — more silly than biting — is recorded in the living room of a North Hollywood apartment. All the action in each episode (they run about 5 minutes) takes place in Carl's cubicle. It's the creation of Mike Upchurch, who has written and produced for "The Chris Rock Show" and "MadTV." The latest episode, which imagines the Starship Enterprise as a typical office environment, may elicit no more than a chuckle or two, but that alone puts it way ahead of, say, "The War at Home."
http://www.nytimes.com/2006/02/11/te...ine.ready.html





NFL Notes: Al Michaels Traded To NBC

Al Michaels was traded from ABC to NBC for a cartoon bunny, four rounds of golf and Olympic highlights.

The rights to "Oswald the Lucky Rabbit," a bunny created by Walt Disney in the 1920s before he invented Mickey Mouse, were transferred from NBC Universal to The Walt Disney Co. as part of the agreement to release the broadcaster from his contract with ABC and ESPN.

"As the forerunner to Mickey Mouse and an important part of Walt Disney's creative legacy, the fun and mischievous Oswald is back where he belongs," Disney president Robert Iger said.

Michaels had been with ABC for three decades and had been the play-by-play announcer for "Monday Night Football" for the past 20 years.

"Oswald is definitely worth more than a fourth-round draft choice," Michaels said, referring to what the Kansas City Chiefs gave the New York Jets as compensation for releasing coach Herm Edwards from his contract. "I'm going to be a trivia answer someday."

A four-time Emmy Award winner, Michaels agreed last July to stay with ABC/ESPN as the Monday game switched to the cable network next fall. But he asked to back out and instead will broadcast Sunday night NFL games on NBC with John Madden, his partner on ABC during the past four seasons.

As part of the deal, NBC sold ESPN cable rights to Friday coverage of the next four Ryder Cups through 2014. NBC also granted ESPN increased usage of Olympic highlights through 2012 and other NBC properties through 2011. NBC, in turn, gets expanded highlight rights to ABC and ESPN events.

NBC Sports chairman Dick Ebersol said ABC Sports and ESPN president George Bodenheimer called last month to initiate talks, which culminated in an agreement Tuesday.

"He told me this incredible story that Walt's first really big production as a cartoonist for the cinema had been a character called Oswald the Lucky Rabbit, which was before Mickey," Ebersol said. "And for reasons that aren't still totally clear to me, Walt lost those rights. He didn't have the money to hold onto them."

Disney and his partner, Ub Iwerks, created the rabbit in 1927 at the request of Carl Laemmle, the founder of Universal Pictures, and made 26 silent cartoons. After Disney learned that Universal held the rights, he created a new character, eventually named Mickey Mouse, who resembled Oswald, but with shorter ears.

Universal continued to make Oswald films from 1929 to 1938 — Mickey Rooney was one of his voices — and Oswald appeared in a comic book from 1943 to 1962.

"We earn nothing from those rights; they've had no value in the United States," Ebersol said.

Michaels, 61, began to think about hopping networks during the past season, realizing he wanted to work with Madden, producer Fred Gaudelli and director Drew Esocoff, who also are moving from ABC to NBC.

"As the weeks went on, I began to realize more and more how much I was going to miss being with those people," he said. "That's my family, that's my broadcasting family, and they're moving out of the house, and I wanted to move back in with them."

Cris Collinsworth, who was going to be Madden's partner, instead will be a studio analyst.
http://seattletimes.nwsource.com/htm...845_nfl10.html





Frequent Netflix Renters Sent To Back Of The Line

The more you use, the slower the service, some customers realize
AP

Manuel Villanueva realizes he has been getting a pretty good deal since he signed up for Netflix Inc.'s online DVD rental service 2 ½ years ago, but he still feels shortchanged.

That's because the $17.99 monthly fee that he pays to rent up to three DVDs at a time would amount to an even bigger bargain if the company didn't penalize him for returning his movies so quickly.

Netflix typically sends about 13 movies per month to Villanueva's home in Warren, Mich. — down from the 18 to 22 DVDs he once received before the company's automated system identified him as a heavy renter and began delaying his shipments to protect its profits.

The same Netflix formula also shoves Villanueva to the back of the line for the most-wanted DVDs, so the service can send those popular flicks to new subscribers and infrequent renters.

The little-known practice, called "throttling" by critics, means Netflix customers who pay the same price for the same service are often treated differently, depending on their rental patterns.

"I wouldn't have a problem with it if they didn't advertise `unlimited rentals,'" Villanueva said. "The fact is that they go out of their way to make sure you don't go over whatever secret limit they have set up for your account."

Los Gatos, Calif.-based Netflix didn't publicly acknowledge it differentiates among customers until revising its "terms of use" in January 2005 — four months after a San Francisco subscriber filed a class-action lawsuit alleging that the company had deceptively promised one-day delivery of most DVDs.

"In determining priority for shipping and inventory allocation, we give priority to those members who receive the fewest DVDs through our service," Netflix's revised policy now reads. The statement specifically warns that heavy renters are more likely to encounter shipping delays and less likely to immediately be sent their top choices.

Few customers have complained about this "fairness algorithm," according to Netflix CEO Reed Hastings.

"We have unbelievably high customer satisfaction ratings," Hastings said during a recent interview. "Most of our customers feel like Netflix is an incredible value."

The service's rapid growth supports his thesis. Netflix added nearly 1.6 million customers last year, giving it 4.2 million subscribers through December. During the final three months of 2005, just 4 percent of its customers canceled the service, the lowest rate in the company's six-year history.

After collecting consumer opinions about the Web's 40 largest retailers last year, Ann Arbor, Mich., research firm ForeSeeResults rated Netflix as "the cream of the crop in customer satisfaction."

Once considered a passing fancy, Netflix has changed the way many households rent movies and spawned several copycats, including a mail service from Blockbuster Inc.

Netflix's most popular rental plan lets subscribers check out up to three DVDs at a time for $17.99 per month. After watching a movie, customers return the DVD in a postage-paid envelope. Netflix then sends out the next available DVD on the customer's online wish list.

Because everyone pays a flat fee, Netflix makes more money from customers who only watch four or five DVDs per month. Customers who quickly return their movies in order to get more erode the company's profit margin because each DVD sent out and returned costs 78 cents in postage alone.

Although Netflix consistently promoted its service as the DVD equivalent of an all-you-can eat smorgasbord, some heavy renters began to suspect they were being treated differently two or three years ago.

To prove the point, one customer even set up a Web site — dvd-rent-test.dreamhost.com — to show that the service listed different wait times for DVDs requested by subscribers living in the same household.

Netflix's throttling techniques have also prompted incensed customers to share their outrage in online forums such as hackingnetflix.com.

"Netflix isn't well within its rights to throttle users," complained a customer identified as "annoyed" in a posting on the site. "They say unlimited rentals. They are liars."

Hastings said the company has no specified limit on rentals, but "`unlimited' doesn't mean you should expect to get 10,000 a month."

In its terms of use, Netflix says most subscribers check out two to 11 DVDs per month.

Management has previously acknowledged to analysts that it risks losing money on a relatively small percentage of frequent renters. The risk has increased since Netflix reduced the price of its most popular subscription plan by $4 per month in 2004 and the U.S. Postal Service recently raised first- class mailing costs by 2 cents.

Netflix's approach has paid off so far. The company has been profitable in each of the past three years, a trend its management expects to continue in 2006 with projected earnings of at least $29 million on revenue of $960 million. Netflix's stock price has more than tripled since its 2002 initial public offering.

A September 2004 lawsuit cast a spotlight on the throttling issue. The complaint, filed by Frank Chavez on behalf of all Netflix subscribers before Jan. 15, 2005, said the company had developed a sophisticated formula to slow down DVD deliveries to frequent renters and ensure quicker shipments of the most popular movies to its infrequent _ and most profitable _ renters to keep them happy.

Netflix denied the allegations, but eventually revised its terms of use to acknowledge its different treatment of frequent renters.

Without acknowledging wrongdoing, the company agreed to provide a one-month rental upgrade and pay Chavez's attorneys $2.5 million, but the settlement sparked protests that prompted the two sides to reconsider. A hearing on a revised settlement proposal is scheduled for Feb. 22 in San Francisco Superior Court.

Netflix subscribers such as Nathaniel Irons didn't believe the company was purposely delaying some DVD shipments until he read the revised terms of use.

Irons, 28, of Seattle, has no plans to cancel his service because he figures he is still getting a good value from the eight movies he typically receives each month.

"My own personal experience has not been bad," he said, "but (the throttling) is certainly annoying when it happens."
http://www.msnbc.msn.com/id/11262292/





BitTorrent to Power ISP's Video Service
John Borland

One of the largest Internet service providers in Britain is teaming with the company responsible for the BitTorrent software to test a new high-speed movie download service, the companies said Friday.

NTL, the largest broadband provider in the United Kingdom, will be testing the file-swapping service as a way to deliver video more cheaply than traditional downloads. Another company, called CacheLogic, will add its data-caching technology to improve the network's efficiency.

The deal is the first public step forward for BitTorrent's hope to turn its technology, widely used for swapping illegal copies of video, into a tool used by movie studios and ISPs for legal services.

"NTL has seen a huge percentage of their traffic in the BitTorrent protocol," said BitTorrent President Ashwin Navin. "But in the past, neither rights holders, ISPs nor BitTorrent derived any economic benefit from it."

The technical trial will begin in April and will go through the summer, the companies said. Navin declined to say what content will be used in the trial, but noted that NTL is a cable company, and thus has rights to video content.
http://news.com.com/BitTorrent+to+po...3-6038269.html





µTorrent's WebUI: Monitor Your Downloads Remotely
Scott Young

Update: Some people were questioning how I got access to these files. While µTorrent itself is developed by ludde, with access to the source and the original creator, there is a µT development "team". We work on stuff like the website, managing the forums and that sort of thing, and get previews of this alpha stuff for that reason. ;)

Lately, the µTorrent development team have been working on a WebUI (web-based user interface) to allow users to remotely manage their BitTorrent downloads. (Don't know what µTorrent and BitTorrent are? Check out my earlier review of µTorrent.)

As the WebUI is still undergoing alpha testing, it is currently inaccessible to the public (when the UI goes final, you'll need to install a bunch of extra "add-on" files to make it work, as the WebUI currently takes up about 110 KiB of disk space after compression - almost as large as µT itself).

However, here's a little intro to the WebUI and how it works. Click the screenshots to enlarge them.

The WebUI runs through your web browser, and is accessible via HTTP through the port you use for BitTorrent. Of course, I'm running on port 31337. Basically what this means is that you can access the WebUI, once installed, by going to http://localhost:port/gui/ index.html in your web browser. localhost basically is a shortcut to "this computer" - so obviously, this will only work if you're accessing the WebUI from the same computer as µTorrent is running on.

It's probably more useful to access the WebUI via your IP address (perhaps using dynamic DNS ). So, if your IP address is 64.233.167.99, and you run µTorrent on port 666, you could access the WebUI at http://64.233.167.99:666/gui/index.html from any PC, assuming you've done all the necessary port-forwarding to allow µT to serve the UI.

Of course, you wouldn't want just anyone to access your UI, so it's locked with a password configurable from µTorrent's Advanced Options menu. Here's the GUI operating on my computer under Opera:

You can get these torrents from legaltorrents.com.

The buttons below the address bar are all part of the WebUI, but I've included the Opera toolbar too just so you can see how the URL works. From left to right, the buttons are basically the same as those in the regular desktop version of µTorrent: add, delete, start, pause, stop, and move a torrent up or down. There's also a fully functional search bar at the right-hand side of the window. Clicking the search icon will open up a menu allowing you to pick a search engine, and entering a query into the box then hitting Enter will pop up with the results in that engine. (Unfortunately, at this stage, the WebUI uses an internal list of search engines - although it can be edited, this may not be the case with the final version. Perhaps it will be able to take the list from µTorrent's Search Engines setting.)

Clicking the plus button (add torrent) spawns a little dialog allowing you to upload a torrent from the current hard disk. This way, you can visit your favourite torrent site, download a .torrent file, and add it to µTorrent, so it's downloading while you're away and ready for you when you get back.

The DHTML columns are fully resizable and sortable, just like in µTorrent (though there is no "secondary sorting" feature). However, sorting the columns is done using JavaScript with no communication with µTorrent, so sorting won't be reflected in µTorrent.

Double-clicking a torrent brings up the Torrent Properties dialog, which you can't move, but it does display most of the info in µTorrent's General tab. You can access the Files tab, too:

You can also right-click on torrents in the main window or in the Files tab, but not all of the options from desktop µTorrent are available:

As for browser support, the WebUI is currently fully functional in Firefox 1.5.0.1, partially functional in Opera 9.0 TP2 (no right-clicks work, even when JavaScript is permitted to control right-clicks), and partially functional in IE (no right-click in the Files tab, occasional graphics glitches and crashes).

Like I said earlier, the WebUI is still under construction and will be released to the public when a more stable version is available. A 'lite' version using less DHTML will be available eventually, too. This is essentially just a preview to see what's coming up in µTorrent development.

If you want remote access to your BitTorrent client now, there are several BT clients offering some sort of WebUI: Azureus (via the Swing Web Interface plugin), ABC and G3Torrent, though apparently the functionality is quite limited and some of the clients are no longer under active development (I haven't tried them out myself). You could also try using a VNC system (like TightVNC), which is what I would recommend, though it's a bit more bandwidth- intensive than a real WebUI - so you can keep using µTorrent.
http://splintax.blogspot.com/2006/02...downloads.html





Warner Music Quarterly Revenues Miss, Shares Down
Yinka Adegoke

Warner Music Group Corp. on Tuesday reported its quarterly profit almost doubled thanks to strong sales of digital songs and lower costs, but revenue missed market expectations and its shares fell.

The company, whose artists include Madonna, Green Day and Sean Paul, said fiscal first-quarter revenue fell 4 percent to $1.04 billion. Analysts surveyed by Reuters Estimates had forecast revenue of $1.09 billion.

"If you're bullish on WarnerMusic you'll be pleased about the profits and digital sales. But the bears are winning out after the company missed analyst revenue expectations," said Banc of America analyst Eric Handler.

Warner Music's shares were down 41 cents, or 2 percent, at $20.39 in afternoon trade on the New York Stock Exchange.

Warner said the decline in revenue reflected exchange-rate fluctuations and the May 2005 sale of its sheet music business, which had contributed $15 million in the year-earlier period. Excluding those items, it said revenues were flat.

Net income for the first quarter ended Dec. 31 rose to $69 million, or 46 cents per share, from $36 million, or 31 cents per share, a year earlier.

Total costs and expenses for the quarter fell 6 percent to $900 million.

Digital revenue rose to $69 million, up 30 percent from the September quarter and nearly triple that of a year earlier, because of online music sales at services such as Apple Computer Inc.'s <AAPL.O> iTunes music store and Napster <NAPS.O>, as well as mobile ringtones.

The United States accounted for about 70 percent of digital music sales, which were split evenly between Internet downloads and ringtones.

Warner Music also said it received another subpoena in February from the New York state attorney general's office in connection with an ongoing antitrust investigation into the pricing of digital music downloads.

The company in a filing with the U.S. Securities and Exchange Commission said it intended to comply with the inquiry. Warner Music had received an earlier subpoena relating to the investigation in late December.

Spokesmen for both Warner Music and for New York Attorney General Eliot Spitzer declined to comment.

Warner Music underwent a restructuring after its 2004 sale by Time Warner Inc. <TWX.N> to an investment group led by media mogul Edgar Bronfman Jr. for $2.6 billion.

The company has focused on cutting costs, exploiting its catalog and investing in digital music. It went public in May last year.

(Additional reporting by Robert MacMillan and Kenneth Li)
http://today.reuters.com/news/newsAr...h=warner+music





The Software You Buy vs. the Free Stuff
Paul J. Lim

ARE tax software programs — like TurboTax from Intuit and TaxCut from H & R Block — still worth the cost in this era of free Web-based help?

It may depend on the complexity of your return. For those with complicated taxes, the answer is probably yes, especially if you are talking about TaxCut Deluxe, which is cheaper than many Web-based tax tools yet offers more useful advice.

But millions of taxpayers who earn modest incomes and have simple returns to file may want to consider using the Free File program from the Internal Revenue Service instead of buying off-the-shelf software. Established three years ago, Free File is a partnership of the I.R.S. and private tax preparation sites that typically allows taxpayers with an adjusted gross income of around $50,000 or less to complete their returns electronically — free.

But you will not be alerted to this program if you visit the individual Web sites of the Free File partners, which include giants like TurboTax and TaxCut.

Instead, you have to go first to www.irs.gov. There, you will see a prominent link to the Free File site. And once you pick a tax preparation service, the I.R.S. will link you to Free File.

What if you earn too much to qualify for the program?

In that case, taxpayers with simple returns might consider a free program like TaxAct Standard, a bare-bones offering that you can download onto your PC or use on the Web. Although there is a charge of $12.95 to buy the corresponding state program, the combined price for the most basic level of TaxAct is still cheaper than the most basic online tools offered by TurboTax and TaxCut. (It is confusing, but the same companies that sell boxed tax programs also provide Web-based tools under the same names.)

If you have a relatively complicated return — for instance, one that requires you to seek help in determining how certain capital gains should be treated or whether certain home-office deductions are legitimate — the traditional off-the-shelf programs are likely to be a better bet.

This year, the nation's two leading software programs —TurboTax and TaxCut — have bundled what previously were three different offerings into one.

At most retailers, TurboTax and TaxCut now combine their federal and state programs into a single box and throw in a free tax-deduction program at the deluxe level or higher. The bundled offers are only slightly more expensive than the previous cost of buying just the federal versions of these programs.

The deluxe version of TaxCut, for instance, sells for $29.99. This includes TaxCut for the federal return, one free state version and DeductionPro, which helps taxpayers find and maximize deductible expenses. The deluxe version of TurboTax, which also includes a free state program and the program ItsDeductible, costs $39.95. ( Amazon.com has recently been offering these two programs at $5 off their list prices.)

By comparison, if you prepared your federal and state taxes by using the equivalent Web-based versions of either TaxCut or TurboTax, you would have to pay $44.90.

Perhaps the best thing that TurboTax and TaxCut did this year was to get rid of most of their annoying rebate offers that required customers to buy separate federal and state programs — and then to mail in a form to get a refund for the cost of the state program.

Among full-service software programs, TurboTax Deluxe and TaxCut Deluxe are more expensive than TaxAct Deluxe. That program, when bundled with a state version, sells for just $19.95 through www.taxact.com. (If you choose not to download the program and instead buy the CD, you will be charged an extra $5.95 for shipping.)

But in a test drive of the three programs, I found TaxAct Deluxe to be much more cumbersome than TurboTax or TaxCut. For instance, to fill out basic W-2 information on TaxAct, you have to click through 13 separate pages. Because I had to fill out W-2's for myself and my wife, it would have been faster to have used a pencil.

This narrowed my choice to TurboTax, the nation's most popular tax software program, and TaxCut, which I preferred last year when I reviewed such programs.

This year, I again preferred TaxCut over TurboTax — and, again, the choice has to do with organization.

To be sure, the distinction is small, and both programs are good at answering basic questions. But in my case, I had numerous questions concerning home-office expenses and deductions, and I thought that TaxCut was a bit more intuitive.

When I reached the business income section, TaxCut immediately asked me about my home-office expenses, as well as questions about other business costs. These included both direct and indirect costs associated with utilities, repairs, maintenance and insurance for my home office.

When I was filling out the same information on TurboTax, I was first asked to list all my business expenses, which included a section on utilities. But then the program told me specifically not to include home office-related utilities because they would be handled later — several clicks away. The delay in getting to my home-office deductions made me wonder whether I had put the information concerning my basic utility costs in the right section. To figure that out, I had to toggle back and forth several times between two sections of the program.

Much to my surprise, I liked another thing about TaxCut: the short video clips at the start of every section of the program. Usually, I would skip through such videos. But TaxCut offered surprisingly useful reminders and warnings, including information on recent changes in the tax laws concerning contributions to individual retirement accounts, charitable gifts and issues related to home offices.

This is not to say that TurboTax is a bad program. In fact, it has made noticeable improvements. Last year, I found it difficult to navigate backward in this program. If I felt that I had not filled out a section properly, for instance, I sometimes got lost trying to get back to that page.

This year, it is not only easy to retrace your steps, but it is also simple to skip through portions of the tax form that do not apply to your situation.

But TaxCut has also improved. You can now fill out your personal information on one screen, instead of having to click through four pages. And after you answer a few simple questions at the start of each section, TaxCut will allow you to skip the unnecessary ones.

WHEN it comes to TaxCut, H & R Block is also leveraging something new: its nationwide chain of more than 12,000 tax offices. Starting this year, H & R Block will offer free personalized audit support for users of any version of TaxCut filed electronically. In other words, if you use TaxCut 2005 and discover nine months later that you are being audited, you can call H & R Block. The company will have a tax professional at a local branch help you in gathering the necessary paperwork. And, if needed, a tax specialist will go with you to the audit.

Of course, a major point of buying good software is not to be audited. But this is a nice safety net for a program that is solid all around. And to cap it off, TaxCut is around 25 percent cheaper than its main competitor. For me, that sealed the deal.
http://www.nytimes.com/2006/02/12/bu.../12review.html





It’s magic! Geekgraffiti…geekfiti!



Open-Source Users Break Free From Commercial Software
Barry Collins

Danny and Linda Lee, who are both in their mid-50s, know as much about computers as they do about gangsta rap.

Yet Mr and Mrs Lee's computer at their home in Bedhampton, Hampshire, England, doesn't run Microsoft Windows. Nor is it a newbie-friendly Mac.

"I gave my parents a machine running Linux, and they know no different," says their son Wayne. "I showed them where to click to start the Internet, and they got on with it. It doesn't faze them at all."

Wayne and his parents are among the growing legions turning their backs on conventional, commercial computer software and, instead, trying open-source programs.

These are usually developed as a global collaboration by volunteers, then made freely available online — and the software is rapidly becoming as good and as easy to run as that of brands costing hundreds of dollars.

Products range from Web browsers through to a complete operating system, and most software will run on both Windows PCs and Macs.

There is an important distinction to be drawn between freeware and open-source software, though.

Freeware doesn't cost a penny, but the public cannot view the computer code that comprises the program, should they wish to develop add-ons or modifications. Internet Explorer is freeware, but nobody is allowed to improve the program except Microsoft, its creator.

The Open Source Initiative (www.opensource.org) believes that the collaborative approach leads to better, more reliable software because it invites peer review.

Unlike Microsoft Windows, say, programmers around the world can go under the hood of open-source software, find out how it works and collaborate to fix bugs or suggest improvements.

Once the preserve of geeks, open source has gone public in the past year, to the extent that programs such as Firefox have become household names.

When a minor update for this browser was released last December, it was immediately downloaded 10 million times, helping to double its annual market share to 10 percent, the researcher Net Applications reports.

And Firefox is no one-off phenomenon: Forty million people have downloaded OpenOffice, an open-source alternative to Microsoft Office.

"I use OpenOffice at home, and I've found that it reads almost all Microsoft Word documents," says Wayne Lee. "I've had no problems at all, and neither have my kids."

Paul Holst of Red Hat U.K., which makes a version of the Linux open-source operating system, says: "The challenge for open source is to make the experience as seamless as possible. I know from experience with my parents that if you install something and it doesn't work within two to three minutes, you've lost them. Once people experience the technology and realize that it's credible, they demand more from their proprietary software."

Even if there is little need to beware of geeks bearing gifts, can free software, created by volunteers, truly be as competent as commercially developed packages? Many experts now think so.

"We are beginning to see free software that is really good," says Rob Jones, editor of Personal Computer World magazine. "The problem is that the people who would benefit most don't know it exists. People who don't want to spend a lot of money on software aren't the hard-core technology enthusiasts."

If that includes you, read the recommendations below for six open-source packages capable of dealing with day-to-day computing needs. Once you have taken a first step down the open-source path, you will find that these programs differ little from products you are used to.

Wayne Lee says: "If I repair a machine for friends, I change the icons around, so when they click on the Internet Explorer logo, it opens Firefox instead. Most people don't notice the difference."

If you are inclined to drill deeper online, you will find communities of enthusiasts eager to improve and add to existing software, often at your request.

Take the Firefox evangelists at forums such as mozillazine.org. A member has asked for an add-on so that he can watch the latest stock-market prices in a side-bar while browsing the Web. This tool will be created to order.

Hundreds of simple yet potent free extensions, both to Firefox and to the Thunderbird e-mail package, already exist at www.mozilla.com/extensions.

One instantly converts foreign currencies on a Web page into pounds. Another delivers thumbnail previews inside Google search results. A third tucks local weather reports permanently inside your browser.

The chances of Microsoft ordering its team of programmers to make such niche add-ons for the now down-at-heel Internet Explorer are, frankly, remote.

Nicholas McGrath, Microsoft's director of platform strategy, says: "We build products according to what our customers want. There are a number of exciting projects in the open-source community, and organic is great when it comes to yogurt, but not when it comes to software development. Customers want to know software is going to be supported, that it will work reliably."

So, what do you do when open-source software goofs up?

With commercial brands, there is frequently a technical-support team. In the open-source world, advice is provided by the online community.

It's an approach that has pros and cons. On the one hand, help is usually provided by knowledgeable people with first-hand experience. On the downside, there is usually nobody on a phone line to deal authoritatively with urgent problems.

The open-source movement is guided by the principle that software should be free, as in speech, rather than beer.

The most famous exception is the Linux operating system, where you pay mainly for documentation and support. It accounts for more than one-fifth of the business-server market, says the research firm IDC, although Linux struggles to gain a foothold in the home, largely because computer manufacturers are reluctant to ship it on their machines.

There are good reasons for this hesitancy: Finding compatible accessories can prove a headache.

As McGrath observes: "The PC plays the key role as the digital hub in the home. Those setups need a lot of different working parts — digital cameras, media players, home networks. All those parts are designed to work with Windows as standard."

Games, too, are nearly always designed to run on Windows.

The tide, however, is beginning to turn.

Dell, the world's largest computer manufacturer, now offers a series of notebooks and desktops without operating systems installed, and the cost saving can be as much as $250.

Linux operating systems are considerably cheaper than Windows XP and, broadly speaking, more secure, too. Now that Dell is prepared to ditch Windows, Linux has to be taken seriously.

Free distribution and the Net's universal reach have empowered a computer-literate generation that is no longer prepared to pay for software or wait ages for updates.

The giants, such as Microsoft, won't be pushovers, especially with new versions of Internet Explorer and Windows due later this year.

Nevertheless, the free-software brigade has created a buzz. The world's richest company is certainly on its toes.

SIX OF THE BEST OPEN-SOURCE FREEBIES

WEB BROWSER: Firefox, www.mozilla.com/firefox

This highly customizable browser is probably the most successful open-source software to date, with 20 million downloads. Why? Because it is quicker, more powerful and less likely to be attacked by security bugs than Internet Explorer. One of Firefox's chief attractions is tabbed browsing, which means you can open several Web pages simultaneously without cluttering your desktop with separate windows. The plug-ins on offer are often fab, too.

Verdict: The best Web browser around, bar none.

OFFICE SUITE: OpenOffice 2.0.1, www.openoffice.org

Microsoft Office dominates the market, but at $300 or more, it's a hefty investment for the home. The latest version of OpenOffice looks so similar, most people will barely notice the difference — and it is free. The software is also compatible with Microsoft (so there is no fear that the kids' homework won't work at school), although it struggled with some heavily formatted Word documents in my tests, although such problems are not unique to OpenOffice.

Verdict: A convincing imposter.

E-MAIL: Thunderbird, www.mozilla.com/thunderbird

As loyal a servant as Parker himself, Thunderbird is more than adequate for home e-mail needs. Similar in design and performance to Outlook Express, Thunderbird soars ahead of its rival with many customizable plug-ins (to give extra functions) and a neatly implemented RSS reader, which brings the latest news from favorite Web sites. However, it made a mess of importing my Outlook address book, confusing first and last names at will.

Verdict: Very good, if occasionally eccentric.

MEDIA CENTER: Media Portal, mediaportal.sourceforge.net

A thinly disguised imitation of Microsoft's Media Center XP edition, the portal provides access to all music, photos and video from one screen or a remote control. It also enables television recording for those with a tuner in their PC. Media Portal is not a full operating system, nor is it as intuitive as Media Center — and you will need to tweak several well-hidden settings — but it is a poke in the eye to those who say open-source software is too complex.

Verdict: A multimedia marvel, after a little tinkering.

INSTANT MESSAGING: Gaim, gaim.sourceforge.net

While Microsoft, AOL and Yahoo childishly still refuse to let their instant-messaging (IM) services talk to one another, Gaim makes them mutually compatible, in a similar manner to Trillian, the superb (but not open-source) freeware. Gaim lacks some of the advanced features offered by the IM packages (there is no alert for incoming Hotmail messages, for example), yet its true beauty lies in its convenience and sheer simplicity. Even better are the nifty free plug-ins.

Verdict: A must-have for all ultra-popular IM chatterboxes.

IMAGE EDITING: The Gimp, www.gimp.org

The perversely named Gimp is a open-source rival to Photoshop, the professional's image editor of choice. As such, it is a reasonably complicated beast, not made any easier by a two-stage installation on Windows. The Gimp has most of the features any digital-camera enthusiast will ever need, and the appearance can be customized to closely resemble Adobe Photoshop (at least on Macs). Competition among budget image-editing software is now fierce, but The Gimp is powerful — and free.

Verdict: Respectable photo-editing tool; not for beginners.
http://www.foxnews.com/story/0,2933,184234,00.html





It's True: These Museum Exhibits Are Fake
Mary Blume

The Museum of Modern Art here has finally reopened with a major Pierre Bonnard exhibition, and over on a quiet residential street in the 16th Arrondissement of Paris the Musée de la Contrefaçon has a timely new show on winter sports gear.

The Musée de la Contrefaçon, or museum of counterfeits, doesn't deal with art forgeries or even with the parlous subject of replicas; though its tasteful copy of the "Winged Victory" is gone, reproduction Régence chairs still decorate its few rooms. Backed by the Union des Fabricants, a manufacturers' group whose roots go back to 1872, it is dedicated to the fight against commercial fakes, from the Rolex watches sold by streetside peddlers to Peugeot hubcaps. Illicit traders, according to European Union figures, net more than E1.5 billion, or about $1.8 billion, per year.

As in everything, there are fashions. The museum used to display fraudulent inner soles and spools of thread and tins of Capitaine Cook marinated herring labeled Capitaine Cody and Capitaine Foc. As consumer tastes change, the humble herring has been replaced by, say, cellphones: in one day, July 28, 2004, customs officers at Charles de Gaulle Airport found 29,000 "Nokias."

The display of winter sportsgear not only signals a growth industry but has its premonitory side as the Winter Olympics approach, and with them shady dealers in fake goggles and parkas. In the spring, with the World Cup, the same vendors will be on hand with seasonally adjusted goods.

The Museum of Counterfeits is possibly the only museum that needn't court wealthy donors since manufacturers are only too glad to hand over samples that have been used in successful lawsuits. Nor, for obvious reasons, does the museum have a boutique-a fake fake Chanel or Vuitton would perhaps be an ironic step too far.

The crowds that flock to Bonnard won't be at the Counterfeit Museum; the joys of spotting the fake Cartier from the real or of gazing at a vitrine of ersatz ink cartridges can pall. On the other hand, the exhibits extract drama from the fear factor.

If visitors are not as moved as they should be by the claim that counterfeit goods cost France E6 billion a year, with a resulting loss of more than 30,000 jobs, there are scary warnings of fines for buyers, which can go up to E300,000 with a jail term of three years, and health risks from phony medicines (do not, advises a caption, order off the Internet), fabrics that cause skin disease and exploding pressure cookers, to say nothing of defective aircraft parts and booze that blinds.

With counterfeit goods accounting for 5 percent to 7 percent of global trade, production lines thrive from Thailand to Brazil, with North Africa now overtaking Southwest Asia as the major growth area. The museum shows fake sneakers made in the Marais district of Paris as well as Bulgarian "Lacoste" boots and a plastic bag full of greedy little crocodiles ready to spawn hundreds of "Lacoste" shirts.

International terrorist groups and money launderers now find the counterfeit trade a profitable revenue- raiser. Even drug traffickers have been rethinking their profit margins: a label states that while a kilo of cannabis leaf fetches only E2,000 in Europe, a kilo of pirated CDs nets E3,000.

An odd exhibit is the "Vuitton" caps seized in Mauritius - odd because while they use the LV print they are not based on any model produced by Vuitton's milliners.

The packages of fake Marlboros look very convincing, and soothing since they lack a strident health warning, as do the Monte Cristo No. 3 cigars, but Mr. Clean becomes Netta, Nescafé becomes Casa Café and Tabasco is Tabard.

A star of the show is a wax mannequin dressed from head to almost toe (for some reason he is shoeless) in awful-looking phony Saint Laurent. He carries a shopping bag that is pretty good except that the words "pour hommes" come out "pour bommes." The caption suggests that in China h and b are easily confused.

Inevitably there is a Kelly bag, Swiss Army knives, Levis, Bic razors, pens and cigarette lighters and endless sports shoes. In 2004 more than 40 million pairs of sports shoes were sold in France, excluding ski boots, and not all were kosher. One Air Max Nike model that went on sale this January was already available in a fake; while the real shoe cost E180, its imitation sold for E50.

Fake sneakers are more dangerous than one might think, the museum warns, "because the shoe is a product in immediate relation with our muscular and nervous functioning." Fakes offer no arch support and their soles fall off.

In general, forgeries of luxury goods are decreasing in favor of mass-produced items.

In addition to floppy disks, Microsoft software and DVDs, toys are a growth industry and the museum outlines carefully the difference between its fake and real Barbie dolls. The true Barbie has supple joints, can be easily dressed or undressed with its Velcro fastening and its hair is carefully planted to permit styling. "False Barbies," the caption warns, "quickly go BALD."

In olden times, the most copied French liquor was Bénédictine, with nearly 1,000 imitations. Dubonnet was available as Duponey and there was a mysterious bogus Pernod labeled "vrai Per'nod Suisse, fabriqué à Oujda, Maroc."

Among the more old-fashioned drinks, Cointreau is actively copied as Coinceau and Coinfereaux, but the trend is to premium brands: Dom Pérignon appears as Perinon and Dom Popingnon. It is best to avoid bottles in foreign bars, the label states. "Fake liquor may have no taste or be fatal."

The oldest exhibit in the museum dates from the first century B.C. and is French. At the time, it seems, Greek and Roman wines were considered the best, a 28-liter amphora having the same market value as one Gallic slave. The museum has an amphora whose stopper is a crude imitation of the mark of Marcus Cassius Caius and which, instead of a fine Phalerian, presumably contained an inferior growth from the midi of Gaul.

As people used to say in those days, caveat emptor, or let the buyer beware.
http://www.iht.com/articles/2006/02/...ures/Blume.php
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Surveillance

Police Blotter: Patriot Act e-Mail Spying Approved
Declan McCullagh

"Police blotter" is a weekly report on the intersection of technology and the law.

What: The Justice Department asks a judge to approve Patriot Act e-mail monitoring without any evidence of criminal behavior.

When: Decided Feb. 2, 2006 by U.S. District Judge Thomas Hogan in Washington, D.C.

Outcome: E-mail surveillance approved.

What happened: As part of a grand jury investigation that's still secret, the Justice Department asked a federal magistrate judge to approve monitoring of an unnamed person's e-mail correspondents.

The request had a twist: Instead of asking to eavesdrop on the contents of the e-mail messages, which would require some evidence of wrongdoing, prosecutors instead requested the identities of the correspondents. Also included in the request was header information like date and time and Internet address--but not subject lines.

The federal magistrate judge balked and asked the Justice Department to submit an additional brief to demonstrate that such a request would be legal.

Instead, prosecutors asked Judge Hogan to step in. He reviewed the portion of federal law dealing with "pen register" and "trap and trace" devices-- terms originating in the world of telephone wiretapping--and concluded it "unambiguously" authorizes the e-mail surveillance request.

Though the language may be clumsy, Hogan said, the Patriot Act's amendments authorize that type of easily obtainable surveillance of e-mail. All that's required, he said, is that prosecutors claim the surveillance could conceivably be "relevant" to an investigation.

Excerpt from the court's opinion:
"In 2001, Congress enacted the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (the "USA Patriot Act"), Section 216 of which explicitly amended the authorities relating to pen registers and trap and trace devices...by expanding the definitions of these devices to include "processes" to obtain information about "electronic communication."

"Commenting on the very language that was finally enacted in Section 216 of the USA Patriot Act, several members of Congress highlighted the fact that the amendments would bring the state of the law in line with current technology by making pen registers and trap and trace devices applicable to the Internet and--more to the point--e-mail.

"For example, a section-by-section analysis of the bill that Representative John Conyers included in the record before the final House vote, which contains the same language that was finally enacted by Congress, states that Section 216 "extends the pen/trap provisions so they apply not just to telephone communications but also to Internet traffic."

"In addition, Senator Jon Kyl, who is currently Chairman of the United States Senate Judiciary Subcommittee on Terrorism, Technology & Homeland Security, noted that the same language in the Senate version of the bill "would codify current case law that holds that pen/trap orders apply to modern communication technologies such as e-mail and the Internet, in addition to traditional phone lines."

"The Congressional Research Service also published a legal analysis of the USA Patriot Act that states that the Act "permits pen register and trap and trace orders for electronic communications (e.g., e-mail)."

"The plain language of the statute makes clear that pen registers and trap and trace devices may be processes used to obtain information about e-mail communications. The statute's history confirms this interpretation and there is no support for a contrary result."
http://news.com.com/2100-1030_3-6037598.html





'Cyber Storm' Tests US Defences

Vital US infrastructure including power grids and banking systems have been put under simulated attack in a week-long security exercise called Cyber Storm.

The war game drew in 115 agencies from the FBI and CIA to the Red Cross, the Department of Homeland Security said.

IT companies and state and foreign governments also played a role in responding to the mock attacks.

The exercise had given the US "an excellent opportunity to enhance our nation's cyber security," the US said.

"Cyber security is critical to protecting our nation's infrastructure," George Foresman of the Department of Homeland Security added in a statement.

The US has been accused of being unprepared for a determined attack by hackers.

Cyber Storm reportedly not only tested against attacks by hackers, but also by bloggers - who deliberately spread misinformation in the exercise.

It was carried out on secure computers in the basement of the Secret Service in Washington DC.

There was no effect on the internet.

The exercise was the latest in a series of simulated attacks, including a gas attack on the New York subway.
http://news.bbc.co.uk/go/pr/fr/-/1/h...as/4706316.stm





U.S. Concludes 'Cyber Storm' Mock Attacks
Ted Bridis

The government concluded its "Cyber Storm" wargame Friday, its biggest-ever exercise to test how it would respond to devastating attacks over the Internet from anti-globalization activists, underground hackers and bloggers.

Bloggers?

Participants confirmed parts of the worldwide simulation challenged government officials and industry executives to respond to deliberate misinformation campaigns and activist calls by Internet bloggers, online diarists whose "Web logs" include political rantings and musings about current events.

The Internet survived, even against fictional abuses against the world's computers on a scale typical for Fox's popular "24" television series. Experts depicted hackers who shut down electricity in 10 states, failures in vital systems for online banking and retail sales, infected discs mistakenly distributed by commercial software companies and critical flaws discovered in core Internet technology.

Some mock attacks were aimed at causing a "significant cyber disruption" that could seriously damage energy, transportation and health care industries and undermine public confidence, said George Foresman, an undersecretary at the Homeland Security Department.

There was no impact on the real Internet during the weeklong exercise. Government officials from the United States, Canada, Australia and England and executives from Microsoft, Cisco, Verisign and others said they were careful to simulate attacks only using isolated computers, working from basement offices at the Secret Services headquarters in downtown Washington.

The Homeland Security Department promised a full report on results from the exercise by summer.

Foresman likened his agency's role during any Internet attack to an orchestra conductor, coordinating responses from law enforcement, intelligence agencies, the military and private firms. The government's goal is a "symphony of preparedness," Foresman said.

Homeland Security coordinated the exercise. More than 115 government agencies, companies and organizations participated. They included the White House National Security Council, Justice Department, Defense Department, State Department, National Security Agency and CIA, which conducted its own cybersecurity exercise called "Silent Horizon" last May.

An earlier cyberterrorism exercise called "Livewire" for Homeland Security and other federal agencies concluded there were serious questions over government's role during a cyberattack depending on who was identified as the culprit - terrorists, a foreign government or bored teenagers.

It also questioned whether the U.S. government would be able to detect the early stages of such an attack without significant help from private technology companies.
http://seattlepi.nwsource.com/nation...ber_Storm.html





Peppering the messenger

Inquiry Into Wiretapping Article Widens
David Johnston

Federal agents have interviewed officials at several of the country's law enforcement and national security agencies in a rapidly expanding criminal investigation into the circumstances surrounding a New York Times article published in December that disclosed the existence of a highly classified domestic eavesdropping program, according to government officials.

The investigation, which appears to cover the case from 2004, when the newspaper began reporting the story, is being closely coordinated with criminal prosecutors at the Justice Department, the officials said. People who have been interviewed and others in the government who have been briefed on the interviews said the investigation seemed to lay the groundwork for a grand jury inquiry that could lead to criminal charges.

The inquiry is progressing as a debate about the eavesdropping rages in Congress and elsewhere. President Bush has condemned the leak as a "shameful act." Others, like Porter J. Goss, the C.I.A. director, have expressed the hope that reporters will be summoned before a grand jury and asked to reveal the identities of those who provided them classified information.

Mr. Goss, speaking at a Senate intelligence committee hearing on Feb. 2, said: "It is my aim and it is my hope that we will witness a grand jury investigation with reporters present being asked to reveal who is leaking this information. I believe the safety of this nation and the people of this country deserve nothing less."

The case is viewed as potentially far reaching because it places on a collision course constitutional principles that each side regards as paramount. For the government, the investigation represents an effort to punish those responsible for a serious security breach and enforce legal sanctions against leaks of classified information at a time of heightened terrorist threats. For news organizations, the inquiry threatens the confidentiality of sources and the ability to report on controversial national security issues free of government interference.

Bill Keller, executive editor of The Times, said no one at the paper had been contacted in connection with the investigation, and he defended the paper's reporting.

"Before running the story we gave long and sober consideration to the administration's contention that disclosing the program would damage the country's counterterrorism efforts," Mr. Keller said. "We were not convinced then, and have not been convinced since, that our reporting compromised national security.

"What our reporting has done is set off an intense national debate about the proper balance between security and liberty — a debate that many government officials of both parties, and in all three branches of government, seem to regard as in the national interest."

Civil liberties groups and Democratic lawmakers as well as some Republicans have called for an inquiry into the eavesdropping program as an improper and possibly illegal intrusion on the privacy rights of innocent Americans. These critics have noted that the program appears to have circumvented the Foreign Intelligence Surveillance Act, which requires court approval for eavesdropping on American citizens.

Former Vice President Al Gore has called for a special prosecutor to investigate the government's use of the program, and at least one Democrat, Representative John Conyers Jr. of Michigan, has said the eavesdropping effort may amount to an impeachable offense.

At the same time, conservatives have attacked the disclosure of classified information as an illegal act, demanding a vigorous investigative effort to find and prosecute whoever disclosed classified information. An upcoming article in Commentary magazine suggests that the newspaper may be prosecuted for violations of the Espionage Act and says, "What The New York Times has done is nothing less than to compromise the centerpiece of our defensive efforts in the war on terrorism."

The Justice Department took the unusual step of announcing the opening of the investigation on Dec. 30, and since then, government officials said, investigators and prosecutors have worked quickly to assemble an investigative team and obtain a preliminary grasp of whether the leaking of the information violated the law. Among the statutes being reviewed by the investigators are espionage laws that prohibit the disclosure, dissemination or publication of national security information.

A Federal Bureau of Investigation team under the direction of the bureau's counterintelligence division at agency headquarters has questioned employees at the F.B.I., the National Security Agency, the Justice Department, the Central Intelligence Agency and the office of the Director of National Intelligence, the officials said. Prosecutors have also taken steps to activate a grand jury.

The interviews have focused initially on identifying government officials who have had contact with Times reporters, particularly those in the newspaper's Washington bureau. The interviews appeared to be initially intended to determine who in the government spoke with Times reporters about intelligence and counterterrorism matters.

In addition, investigators are trying to determine who in the government was authorized to know about the eavesdropping program. Several officials described the investigation as aggressive and fast-moving. The officials who described the interviews did so on condition of anonymity, citing the confidentiality of an ongoing criminal inquiry.

The administration's chief legal defender of the program is Attorney General Alberto R. Gonzales, who is also the senior official responsible for the leak investigation. At a Senate Judiciary Committee hearing on Feb. 6, Mr. Gonzales said: "I'm not going to get into specific laws that are being looked at. But, obviously, our prosecutors are going to look to see all the laws that have been violated. And if the evidence is there, they're going to prosecute those violations."

Mr. Bush and other senior officials have said that the electronic surveillance operation was authorized by what they call the president's wartime powers and a Congressional resolution authorizing the use of force against Al Qaeda passed in the days after the September 2001 terror attacks.

The government's increasing unwillingness to honor confidentiality pledges between journalists and their sources in national security cases has been evident in another case, involving the disclosure in 2003 of the identity of an undercover C.I.A. officer, Valerie Wilson. The special counsel in the case, Patrick J. Fitzgerald, demanded that several journalists disclose their conversations with their sources.

Judith Miller, at the time a reporter for The Times, went to jail for 85 days before agreeing to comply with a subpoena to testify about her conversations with I. Lewis Libby Jr., who was chief of staff to Vice President Dick Cheney. Mr. Libby has been indicted on charges of making false statements and obstruction of justice and has pleaded not guilty.

"An outgrowth of the Fitzgerald investigation is that the gloves are off in leak cases," said George J. Terwilliger III, former deputy attorney general in the administration of the first President Bush. "New rules apply."

How aggressively prosecutors pursue the new case involving the N.S.A. may depend on their assessment of the damage caused by the disclosure, Mr. Terwilliger said. "If the program is as sensitive and critical as it has been described, and leaking its existence could put the lives of innocent American people in jeopardy," he said, "that surely would have an effect on the exercise of prosecutorial discretion."

Recently, federal authorities have used espionage statutes to move beyond prosecutions of government officials who disclose classified information to indict private citizens who receive it. In the case of a former Pentagon analyst, Lawrence A. Franklin, who pleaded guilty to disclosing defense secrets, federal authorities have charged Steven J. Rosen and Keith Weissman, formerly representatives of the American Israel Public Affairs Committee, a pro-Israel lobbying group.

The two men have been indicted on charges of turning over information obtained from Mr. Franklin to a foreign government, which has been identified as Israel, and to journalists. At Mr. Franklin's sentencing hearing in Alexandria, Va., Judge T. S. Ellis III of Federal District Court said he believed that private citizens and government employees must obey laws against illegally disseminating classified information.

"Persons who have unauthorized possession, who come into unauthorized possession of classified information, must abide by the law," Judge Ellis said. "That applies to academics, lawyers, journalists, professors, whatever."

Some media lawyers believe that The Times has powerful legal arguments in defense of its reporting and in protecting its sources.

Theodore J. Boutrous Jr., who has represented publications like The Wall Street Journal and Time magazine, said: "There is a very strong argument that a federal common-law reporters' privilege exists and that privilege would protect confidential sources in this case. There is an extremely strong public interest in this information, and the public has the right to understand this controversial and possibly unconstitutional public policy."
http://www.nytimes.com/2006/02/12/po...12inquire.html





Detective's Employer Knew About His Sleuthing Device
David M. Halbfinger and Allison Hope Weiner

Throughout the three-year federal investigation of Anthony Pellicano, the celebrity detective at the center of a huge Hollywood wiretapping scandal, the top-tier entertainment lawyer Bert Fields and his firm have insisted that they never knew their go-to investigator was secretly recording his targets' phone calls.

But an indictment unsealed this week makes clear that Mr. Fields's firm, which frequently deployed Mr. Pellicano to dig up dirt on its legal opponents, also played a central role in his pursuit of a trademark for the very device the government says he was using to wiretap his targets: a combination of computer hardware and software he called, aptly enough, Telesleuth.

Brian Sun, a lawyer for Mr. Fields's firm, Greenberg, Glusker, Fields, Claman, Machtinger & Kinsella, said its lawyers believed that Mr. Pellicano intended to use Telesleuth on behalf of his many law-enforcement clients. Mr. Sun said the firm also believed that Telesleuth could not be used as a wiretapping device, although the participant in a call could use it to record a conversation.

"It would be ludicrous to suggest that the firm or any of its lawyers would ever have associated themselves with any wiretapping activity," Mr. Sun said.

Mr. Sun, who said he was speaking on Mr. Fields's behalf in this regard, said Mr. Fields may have brought Mr. Pellicano's request to the firm, but that he did not work on the trademark matters.

Mr. Pellicano pleaded not guilty to wiretapping and other charges on Monday.

Precisely what the firm knew about Mr. Pellicano's intentions for the Telesleuth device has been the subject of intense interest by prosecutors, however: a lawyer in the case confirmed that the government had subpoenaed documents arising from Mr. Pellicano's pursuit of the Telesleuth trademark, and that his lawyers had resisted handing over at least some of them.

By the mid-1990's, Mr. Pellicano, through one of his companies, Forensic Audio Labs, had become one of the nation's foremost expert witnesses in analyzing audiotapes, often for prosecutors in organized-crime cases involving court-ordered wiretaps.

But federal prosecutors here now say that in 1995, Mr. Pellicano sought to conduct his own wiretaps, without court orders. He quietly hired a self-taught computer programmer, Kevin Kachikian — who also pleaded not guilty to federal charges on Monday — to develop software for intercepting phone calls.

By the fall, Mr. Pellicano's idea had advanced as far as coming up with a brand name: Telesleuth. He wanted to trademark the name, so he turned to a law firm he knew well: Greenberg, Glusker. Its most famous partner, Mr. Fields, had already worked closely with Mr. Pellicano. On Nov. 6, 1995, a lawyer there, Jill A. Cossman, applied on Mr. Pellicano's behalf for a trademark with the United States Patent and Trademark Office.

According to prosecutors, Mr. Pellicano had engineering work done the following March to finish the hardware for Telesleuth, and in January 1997 he began bribing a phone company worker to help him. In May 1997, the two used Telesleuth to wiretap a Los Angeles real estate developer, Robert Maguire.

Two months later, Mr. Pellicano — this time using the Greenberg, Glusker lawyer Michael K. Grace, who left the firm in 1999 — applied for a second trademark, for a program called Forensic Audio Sleuth, also designed by Mr. Kachikian, that can play back and enhance the quality of audio recordings. On his Web site, Mr. Kachikian, whose lawyer did not return calls on Friday, boasts that Mr. Pellicano used it in the trial of Eric and Lyle Menendez, in 1993, and on behalf of Michael Jackson.

Mr. Pellicano successfully registered the Forensic Audio Sleuth trademark in January 2000. But his trademark application for Telesleuth was abandoned in February 2000, after Mr. Pellicano and his lawyers had received a fifth and final six-month extension from the trademark office. In order to register the Telesleuth trademark, experts say, they would have had to show that the mark was being used in ongoing commerce.

Although Mr. Pellicano never submitted evidence of his marketing of the Telesleuth name, the federal indictment and interviews show he was actively using the device. In September 1997, prosecutors say, he began using it to wiretap Mark R. Hughes, the founder of Herbalife, and he used Telesleuth in at least two other wiretaps over the next year.

But Mr. Pellicano and Mr. Kachikian may have encountered some glitches with Telesleuth early on. In 1999, Mr. Pellicano had Immuneal Manufacturing of Philadelphia make a container to shield Mr. Kachikian's printed circuit boards from electromagnetic fields. One expert on telephony suggested that those fields could be generated by power lines that run near telephone switch boxes. After some modifications, Mr. Pellicano ordered 24 more of those containers in July 2000, said Larry Maltin, the company's president.

Over the next 18 months, Mr. Pellicano's business boomed, and he installed at least nine more Telesleuth wiretaps, prosecutors say. In early 2002, Mr. Pellicano paid Mr. Kachikian $13,425 for his work on the project. And before Mr. Pellicano's work was interrupted by a federal raid on his Sunset Strip offices that November, he installed another two wiretaps — one on the actor Sylvester Stallone, another on a Los Angeles Times reporter, Anita Busch.

A month later, prosecutors say, Mr. Kachikian destroyed computer files, hardware and software relating to Telesleuth.

On his Web site, though, Mr. Kachikian still proudly lists his work on behalf of Mr. Pellicano. The Web site does not mention Telesleuth by name. But Mr. Kachikian's résumé does note that he designed a "telephony hardware interface and control software. "
http://www.nytimes.com/2006/02/12/na...gator.web.html





MPs Reject ID Card Costings Call

MPs have voted against making the government carry out a report on costs before introducing identity cards.

They decided by a majority of 53 to overturn an amendment made to the ID Cards Bill by peers last month.

But MPs called for a report on costs every six months for the first 10 years of the scheme being in place.

MPs also backed ministers in making it compulsory for people to be given cards - and put on a register - when they apply for passports.

Critics are concerned about the cost and civil liberty implications of the scheme and some commentators had predicted the votes would be closer.

ID card plans, opposed by Conservatives and Liberal Democrats, will now go back before the House of Lords.

Civil liberties

An amendment, put forward by former health secretary Frank Dobson, requiring the government to produce a report every six months, was approved without a vote.

MPs backed plans to put people applying for passports from 2008 on the ID cards register by a majority of 31. Around 20 Labour backbenchers rebelled against the government.

MPs also decided by a majority of 51 to ensure all passport applicants are given ID cards.

Earlier, MPs approved a government compromise requiring new legislation before ID cards are made compulsory for all.

Prime Minister Tony Blair was not able to attend the debate after his plane was grounded by engine troubles in South Africa.

Defeats

He told the BBC: "I think we've won the argument on it. People have this idea that there's a problem in civil liberties with people having an identity card and an identity registered today when across all walks of our life this is happening.

"And with the real problems people have today with identity fraud, which is a major, major issue; illegal immigration; organised crime: it's just the sensible thing to do."

Last month, peers voted for the scheme not to go ahead until the full costs were known and for more security provisions for stored personal data.

Home Secretary Charles Clarke had said a stand-alone ID card would cost £30, while one linked to a passport would cost £93.

But that figure has been disputed, most notably by a London School of Economics report estimating the cards could cost up to £300 each.

Demonstrations

Home Office minister Andy Burnham told BBC News that the vote showed support for the Bill was "solidifying".

"We think it gives the vote a very clear mandate going forward," he added.

"It's dispelled some of the doubts, the criticism, and we think the scheme can now move forward with confidence."

But shadow home secretary David Davis described the scheme as one of "creeping compulsion".

Lib Dem home affairs spokesman Alistair Carmichael said: "The government made a pledge at the election to introduce voluntary identity cards. Tonight they broke that pledge.

"The only way in which people will be able to opt out of the system is by giving up their right to travel abroad.

"The fight against compulsory ID cards will continue in the House of Lords, where we will hold the government to their manifesto commitment."

Before the debate got under way about 70 people were at a protest outside Parliament involving civil rights group Liberty and the No2ID pressure group.
http://news.bbc.co.uk/go/pr/fr/-/1/h...cs/4707608.stm





Video Surveillance Outfit Chips Workers
Jan Libbenga

A Cincinnati video surveillance company CityWatcher.com now requires employees to use Verichip (http://www.verichipcorp.com) human implantable microchips to enter a secure data centre. Until now, the employees entered the data centre with a VeriChip housed in a heart-shaped plastic casing that hangs from their keychain.

The VeriChip is a glass encapsulated RFID tag that is injected into the triceps area of the arm to uniquely identify individuals. The tag can be read by radio waves from a few inches away.

The news was reported by CASPIAN (http://www.nocards.org) (Consumers Against Supermarket Privacy Invasion and Numbering), a US organisation that opposes the use of surveillance RFID cards.

Although CityWatcher does not require its employees to take an implant to keep their jobs, they won't get in the data centre without it. CASPIAN’s Katherine Albrecht says chipping sets an unsettling precedent. "It's wrong to link a person's paycheck with getting an implant,” she says.

CityWatcher argues that chipping employees is a move to increase the layer of security, as present systems can be compromised. However, CASPIAN warns that this can happen to implantable chips too. Security researcher Jonathan Westhues - author of a chapter in a book titled Hacking the Prox Card - recently demonstrated how the VeriChip can be skimmed and cloned by a hacker. A cloned chip theoretically could duplicate an individual's VeriChip implant to access a secure area.
http://www.theregister.co.uk/2006/02...oyees_chipped/





RFID Hacks

Cellphone Could Crack RFID Tags, Says Cryptographer
Rick Merritt

A well known cryptographer has applied power analysis techniques to crack passwords for the most popular brand of RFID tags.

Adi Shamir, professor of computer science at the Weizmann Institute, reported his work in a high-profile panel discussion at the RSA Conference here. Separately, Ron Rivest, who co-developed the RSA algorithms with Shamir, used the stage of the annual panel to call for an industry effort to create a next- generation hashing algorithm to replace today’s SHA-1.

In recent weeks, Shamir used a directional antenna and digital oscilloscope to monitor power use by RFID tags while they were being read. Patterns in power use could be analyzed to determine when the tag received correct and incorrect password bits, he said.

"The reflected signals contain a lot of information," Shamir said. "We can see the point where the chip is unhappy if a wrong bit is sent and consumes more power from the environment…to write a note to RAM that it has received a bad bit and to ignore the rest of the string," he added.

"I haven’t tested all RFID tags, but we did test the biggest brand and it is totally unprotected," Shamir said. Using this approach, "a cellphone has all the ingredients you need to conduct an attack and compromise all the RFID tags in the vicinity," he added.

Shamir said the pressure to get tags down to five cents each has forced designers to eliminate any security features, a shortcoming that needs to be addressed in next-generation products.

Separately, cryptographers discussed the weaknesses in the fundamental SHA-1 hashing algorithm that were announced at the group’s panel in 2005. "That was a real wake up call for cryptographers," said Rivest, who is also professor of electrical engineering and computer science at MIT.

"I would like to see a process like the industry conducted for the AES algorithm to work on a new hash function that could be delivered by 2010," Rivest said. "We are skating too close to the edge with the hash functions we use now," he added.

The National Institute of Standards and Technology ran the program that resulted in AES, but complained last year it lacked the resources in the near term to develop a similar program for hash functions.

"My guess is they will get pushed into doing this again," said Rivest in an interview after the panel. "A four-year time frame is probably fine for a technology bake off. There’s no reason to panic," he added.

"If it was brought up by this panel, it will probably spark a fire and the NSA or someone will get something going," said Sheueling Chang, a distinguished engineer in cryptography at Sun Microsystems who attended the panel.
http://www.eetimes.com/news/semi/sho...leID=180201688





All pics on site

For Anything: Proxmarkii
Jonathan Westhues

My initial prox card ‘cloner’ did the job, but it was not very general. Because I use analog circuitry to demodulate the signal from the antenna, the hardware is capable of dealing with only a single modulation scheme—BPSK, with the modulating frequency and bit times that I chose to work with the Flexpass cards. It has to be like that; the PIC is not powerful enough to do it any other way.

Since then I have built a considerably more general device. My new device is capable of working with nearly any kind of 125 kHz card, and many types of 13.56 MHz cards. It is also capable of bidirectional communication, so that it can send data from the reader to the tag. This is necessary to work with most of the newer tags, including any cryptographic tag. (Note, of course, that a tag that uses cryptographic techniques can resist any practical attempts to clone it over the air; but I can still talk to the tag, and do anything that its reader could, even if I cannot clone the thing.)

The system is based around an ARM7 microprocessor. I chose an AT91 part from Atmel, for its ease of integration—it has adequate on-chip flash and SRAM—and for its wide range of peripherals. In particular, the AT91SAM7S64 has a USB slave peripheral. That makes it convenient to send large amounts of data from the device to a PC, very quickly; for example, I can do an ‘oscilloscope view’ of the signal from the tag, so that I can get some idea of what a tag is doing, without additional test equipment and before I write the code to demodulate that signal into bits.

A small amount of analog circuitry is used to fix the dynamic range of the signal from the antenna. This is the usual problem, that we receive the superposition of our transmitted carrier and the returned signal from the tag, and that we really just care about the latter. After that the signal goes straight into an A/D; all further processing is digital. To date I have tested against two different prox cards: a ‘Radionics’ card with no other markings, and an HID Prox Card II. This is a waveform from the Radionics card:

It is easy to see that this card uses ASK. The Prox Card II uses slow FSK:

Since these were all ID-only cards, there was no need to demodulate the signal in real time. I therefore just transfer the samples to my PC, and convert them into bits over there.

I can also read or simulate TI-type tags; these tags communicate with the reader in a somewhat different way, so that special hardware was required to deal with them. Still, they seem to work fine:

The trace is not the raw signal from the ADC; it is the difference between the output powers of matched filters for the two FSK tones, so that it is basically a plot of the soft decision on the bit.

I designed this device to be as flexible as possible. Certainly, I can read or simulate most kinds of tags. In addition to this, the device is capable of working in ‘snoop’ mode, in which it passively listens to signals from other RFID tags and readers. This is necessary to investigate ‘reader talks first’ bidirectional tags—it is necessary to start out by snooping, to find out what the reader is saying to the tags, so that you can duplicate it.

There is circuitry to modulate the transmitted carrier, in order to send data to the tag. This is also what I use for the ‘simulated tag’ modes. I use the synchronous serial port's data-out line as a sort of a 1-bit DAC. That allows me to queue up the desired pattern in a DMA buffer, and to send it from there to a serial port. The timing is therefore determined by the serial port, which is easily programmed, and not by processor cycle-counting, or something inconvenient like that.

The ARM7 at 48 MHz gives more than enough processing power. There is no need to be very efficient, so everything can be written in C. I used arm-elf-gcc, which generates more than good enough code. I wrote a bootrom, so that I can load new code over USB.

The hardware is not really that remarkable. It is a low-end RFID tag reader, with an interesting receive path, though with a curiously weak transmitter. The ‘simulated tag’ modes are the only thing that is unique. Still, I expect that it will take a lot of the drudgery out of cloning ID-only tags, and it is really the only practical way to experiment with the more advanced transponders.

A commercial RFID tag reader offers no possibility to manipulate the lower layers of the protocol over the air; it just gives you the ID, or the piece of information that you requested, and it doesn't tell you what it went through that get that. For ID-only tags (like most low-frequency prox cards), the ID is really all that there is to know. Modern tags are more complex, though; they do things like anti-collision, or crypto, or addressable memory on the tag. As these more interesting tags become more prevalent, it seems terrible not to be able to know this, and that is not possible without either (a) getting schematics and code for a suitable commercial reader, or (b) starting from scratch. Option (a) did not seem plausible; I therefore started from scratch.

The hardware works, but so far I have been unfortunately lazy. I have written code to read and clone a few types of ID-only cards, but that's about it. I can program rewritable TI-type tags, but that's pretty easy; they barely talk back when you do. As far as I can tell, the hardware is perfect. The A/D that I thought might be too slow turned out to be too slow; my fallback plan, which was to sample only every other or (for BPSK at 62.5 kHz, where every other breaks down) every third 125 kHz cycle, works just as well in practice. A fast sample-and-hold is really more important than a fast A/D....

I run it off a lithium-poly cell, which can be recharged when the device is plugged in to USB. The user interface is a bit spartan, just three LEDs and a pushbutton. The smaller size is nice; it's no larger than a business card. Certainly this is a much more fun device to carry; you can read people's cards, and look at the 'scope view on your laptop, and reverse-engineer the protocol in real time. I have yet to do anything with a not-ID-only tag, which is somewhat pathetic.

As far as I know, it is not possible to buy a device like the one that I have described above, and an instrument like this is practically essential for anyone experimenting with the latest generation of transponders. If anyone is interested in doing low-level work with RFID tags, then you could presumably save some time by starting with the platform that I have built. I do have many extra bare boards. At some point I intend to freely distribute the schematics, layout, and software, but there is a lot that must first be cleaned up. I will see.

As an example of the capabilities of this device, I go through the steps involved in cloning a Verichip. This is the same sort of process that would be required to clone any kind of ID-only tag. For a bidirectional (e.g multipage or anticollision) tag, the process would be similar but more complex.
http://cq.cx/proxmarkii.pl


Demo: Cloning a Verichip

In Brief: Verichip markets their product for access control. This means that you could have a chip implanted, and then your front door would unlock when your shoulder got close to the reader. Let us imagine that you did this; then, I could sit next to you on the subway, and read your chip's ID. At this point I can break in to your house, by replaying that ID. So now you have to change your ID; but as far as I know, you cannot do this without surgery.

All of this relates to an article that Annalee Newitz is writing for Wired. To me, this is yet another ID-only tag, and not very special to clone. Still, she had bothered to have one implanted, pretty much entirely for that purpose, and she was looking for someone who could do it. As we will discover, they are built with no security. It was therefore not that hard.

I went to the trouble of cloning her implanted tag, which seemed entirely unnecessary; the sample tags worked fine. She thought that it would be more impressive like that. Actually, she might have been right. The article comes out in May.

Also, before anyone else links to me using the phrase ‘claims to:’ of course I can clone it. It is really not difficult. If you are still unconvinced, and you live in or can travel to the greater Boston area, then contact me, and I will see what I can do about a demo.

* * *

I will briefly describe the steps that I went through to duplicate an ID-only RFID tag using my proxmarkii device. We will be cloning a Verichip, which should not rationally make any of this more interesting but does.

I have a reader and some tags. The first thing to do is to determine the frequency of operation. I could have used the proxmarkii, but I actually just used a coil of wire and my 'scope. I measured the voltage across the coil, energized the reader, and used cursors to measure the frequency of the signal received. These tags happen to work around 134 kHz.

TI's glass transponders work near that frequency, so my first thought was that the Verichip was basically one of them. I therefore tried to read my Verichip as a TI-type tag. That means that I excite it with a pulse a few dozen milliseconds long, and then turn off my carrier and listen for a response.

Clearly, this did not work. The Verichip is not a TI-type tag. That means that it's probably the continuously-illuminated kind. I actually could have determined this from the signal that the reader sends out, if I had paid more attention then. The proxmarkii device could read 134 kHz continuously-illuminated tags if I wrote the proper software for it. Instead I will be lazy and just try it at 125 kHz; the read range will suffer, but that isn't really critical.

So now I did a low-frequency read, and this time I got something. What is unfortunate is that it is a mess. I just want to duplicate the tag, so there is no particular reason to reverse- engineer the exact structure of the bits sent over the air. Still, it would be nice to know the fundamentals, like the period...

I do a quick autocorrelation to determine the period of the returned signal. We could save a trace and do it in MATLAB, but I prefer to do it in the proxmarkii software. MATLAB is nice for signal processing, but not so good for scrolling through long traces. The graph tool that I use is more like the user interface of a digital storage 'scope. It is obvious that the period is 2048 samples (which, sampling every other carrier clock, is 4096 carrier clocks).

Actually it looks like there's a little more structure to the signal, considering all those transitions for an ID that is mostly zeros. I would guess that it is Manchester-coded ASK, or something differential, or something weird. If we wanted to determine the mapping between the tag's ID and the signal sent over the air, then we would spend more time on this. For now it is not worth the bother.

If all that I want is to clone the tag, then it is arbitrary which point in the signal I designate as t=0. The ID just loops, so the signal over the air is unaffected. That feature between the cursors looked sort of like a sync pattern, though, and it occurs in both tags’ traces. For want of a better idea, I will write my demod code to correlate for that, and use that as its reference. Then I can demodulate the received signal to a bit string.

At this point it is only a matter of remodulating the received signal, and we're done. Then I can download that signal to my proxmarkii, put it in ‘simulate’ mode, and it should be indistinguishable from the legitimate tag. To be on the safe side, I read my ‘simulated tag’ using another proxmarkii device, to make sure that my simulated ID is correct. If that looks okay, then I am ready to check my work against the legitimate reader, and as we would hope, it reads:

(Notice that the demodulation and remodulation steps are in a sense unnecessary; I could have just replayed the exact signal that I received over the air, without demodulating and remodulating it. That means that you get twice as much noise, though, because the signal received from the tag never gets ‘cleaned up.’ If I wanted to make this very automatic, then I could write code for the proxmarkii that would automatically determine the period, read the ID many times, and average those together, lining them up at the points of maximum cross- correlation. That might be sort of cute, because it would be fully automatic for any modulation scheme, but it seems like a lot of trouble.)

This took me a couple of hours. I could have done it faster if I had not constantly been interrupting myself to take a screenshot or a picture. Of course it will take me some time if I want to build out the software to read them properly, at 134 kHz.

The screenshots and the photograph prove nothing. I therefore save the traces:

verichip-raw.tr: the raw signal from the tag, voltage versus time, one sample every other carrier clock
verichip-remod.tr: the remodulated (i.e., cleaned up) ID, ready for replay, one sample per carrier clock

These are for Annalee's Verichip, number 1022000000047063.

There is a curious aside: the Verichip that I read here is not supposed to have that ID, according to medical records; but the ID that I cloned is the ID that my legitimate reader reports. As to what this means—malpractice? sloppy record-keeping? that I have the special ‘reverse engineer's edition’ of the reader?—I haven't a clue.

Oh, and lest anyone get overly worried about drive-by Verichip identity theft: that is probably not a big deal. Their biggest security feature is the absurdly short read range, which is restricted by the tiny antenna. As long as the user stays at least a foot away from any unsecured person or thing, there is very little risk.
http://cq.cx/verichip.pl





Why The Net Should Stay Neutral
Bill Thompson

Is it time to let internet companies provide premium access to paying websites and services? No, says technology commentator Bill Thompson.
One of those loud and angry debates that seems to have nothing to do with the rest of the world is currently playing out in the US.

The Senate Committee on Commerce, Science and Transportation is considering making changes to the 1996 Telecommunications Act, and one of the ideas being floated is that network providers should be allowed to offer preferential service to some of their customers instead of providing a neutral data carrier service.

Back in 2004, Michael Powell, at the time chairman of the Federal Communications Commission, said that net service firms should support "network freedom" and ensure that their users could access all lawful content and attach whatever devices they want to their network connection without any discrimination.

Now some of the big telecoms companies want to be able to sell premium services for things like streaming video or voice over IP, and some people are worried that this will eventually lead to a segregated internet.

They include Lawrence Lessig, law professor at Stanford University, founder of the Creative Commons and one of the most significant and influential thinkers about the future of the network we have been building for the past 30 years.

It's a big issue.

After all, once we get away from the idea that the pipes just move bits around without really caring what data is being transmitted, it's a small step to discriminating against some forms of content and then targeting specific sites, services or users.

Instead of an "end-to-end" network, we would end up with something more like the phone network, along with a complicated array of charging schemes for "0800", "0845" and "0871" sites.

Those in favour of "network neutrality" and keeping the current model of the internet as just a data conduit include big hitters such as Google, eBay, Amazon and even Microsoft.

They know it will cost them more if they have to pay to get their video delivered to users.

The phone and cable companies want to be free to charge for new services and make more money, and they argue that it's not up to the government what they do with their networks.

Policy echo

This might not seem to matter to the rest of us, since the US no longer has the majority of network users, but of course business practices, technologies and even laws made over there tend to have a disproportionate impact on the rest of the world so we should pay attention.

We've already seen how the Digital Millennium Copyright Act, a US law designed to protect the interests of large media organisations, resulted in the appallingly restrictive EU Copyright Directive. We don't want anything like that to happen this time.

This debate is happening now largely thanks to the internet's astonishing success.

The earliest packet-switched network connections, the ones that made up the early Arpanet back in the late 1960s, used telephone lines to transmit data between university campuses in California and Ohio.

But they used the network in the way that canal boats use water. A canal has no idea what is being carried in the narrow boats, and it doesn't really care. Until the 1990's the phone companies didn't really know or care what data was going over the leased lines they sold.

When dial-up access started to take off, there was a flurry of activity and attempts at control, all of which failed.

However, now all the telcos run their own networks using internet technologies and internet protocols and they want a piece of the action.

Charging differently for different content is not the same as turning the net into a toll road, open to all for a fee.

We already have that: if you choose to pay more you can have a fast broadband connection to your home; if you choose to pay vast amounts of money you can stream large amounts of data like Google or the BBC does.

Justice call

What is being proposed is more like building two roads into every town and up to every house, one smooth and well-maintained tarmac and the other a dirt track, and then letting Tesco and Waitrose bid for the right to use the good road.

This issue just the latest round of a long-running debate about how much government - of whatever type, in whatever country - should be involved in the growth and development of the internet.

Some, mostly libertarian conservative thinkers like those at the Cato Institute, instinctively oppose any and all regulation and want the free market to determine what services are offered, at what price and to whom.

Even those who remember that the net emerged from a publicly-funded attempt to build a high-speed data network choose to claim that the days of subsidy are now over and that only deregulation can offer real benefits, both to companies and to the wider society.

For them, any attempt to restrict the telephone companies' freedom to offer preferential service is tantamount to state socialism and one step away from a communist revolution.

Of course they are wrong, and badly so.

I'm a market socialist, and I believe that regulated markets are the best way to create social value. I have also been using the net since 1985 and I have seen it evolve and grow thanks to the balance between regulation and market forces. That balance has to be maintained.

Social justice is best served by ensuring that public utilities, of which the network is surely one, are regulated in the public interest.

Markets fail, and they do so in ways that any humane society must address. Ensuring that network access is available to all and that the network itself carries all lawful traffic is the only way forward.

We must just hope that the US government recognises that this is the case, and sets a good example to the rest of the world.
http://news.bbc.co.uk/go/pr/fr/-/2/h...gy/4700430.stm





It's Like Lending to a Friend, Except You'll Get Interest
Bob Tedeschi

THE Internet has become a great place to track down friends — or friends of friends — for advice or for a date. Now you can ask them for money, too. Prosper.com, a start-up company based in San Francisco, started operations last week, offering a mixed brew of eBay, Friendster and the local bank.

Prosper's users lend money to and borrow money from other people on the site at what the company says are better interest rates than those available through traditional financial institutions and without some of the risk that comes from typical person-to-person loans.

"We looked at eBay and said, 'Why can't we do this for money?' " said Chris Larsen, Prosper's chief executive.

Mr. Larsen, who founded and led E-Loan, an online lender that was bought last year for $300 million by Popular Inc., says Prosper could save borrowers and lenders money because it was a leaner operation than traditional financial institutions. He noted that consumers make, at most, about 4 percent on their savings accounts, which banks then lend to credit card customers at 14 percent or more.

"That's just a huge spread," Mr. Larsen said. "We think if you allow people to participate directly, it's a more efficient marketplace. People can make a better return on their deposits, which then become the source of credit to others."

On Prosper.com, prospective borrowers register with the site and allow the company to review their credit history. Then borrowers post a loan request of up to $25,000, along with an upper limit for the amount of interest they are willing to pay. Loans are not secured by collateral and are paid off over three years at a fixed rate, with no prepayment penalty.

Lenders essentially deposit their money with Prosper — which holds it in an interest-bearing account with Wells Fargo— and either review the loan requests individually or fill out a form permitting Prosper to allocate money to borrowers who meet certain criteria.

Chief among those criteria is the borrower's rating from the credit reporting bureau Experian, but borrowers can also join or create groups with defined interests or characteristics that, they hope, will make them more attractive to some lenders.

Among the groups on Prosper are aficionados of the Porsche 914 model, associates and employees of a Berkeley cafe and Vietnamese-American students. Borrowers, who typically post their loan requests and any group affiliation, along with a description of who they are and why they need the money, then wait a maximum of two weeks for lenders to bid in ever-lower interest increments for the right to issue the loan.

To help lenders minimize risk, Prosper permits them to finance just part of a given loan, so a typical lender may offer, say, $100 at 6.5 percent interest toward a loan to someone with excellent credit.

Once the bidding is complete, and if enough lenders bid enough money to finance the loan at a single rate acceptable to the borrower, Prosper transfers the money to the borrower's account and establishes a monthly repayment system that withdraws money from the borrower's checking account. (Should a borrower default, Prosper hires a collection company on the lender's behalf and alerts credit bureaus.)

Prosper makes money by charging borrowers 1 percent of the loan amount, while lenders pay 0.5 percent of the loan's balance each year.

The community aspect of the site, Mr. Larsen said, is an important component. "It's satisfying to place money in little bits with people who have stories, and in groups that you know and trust and want to support," he said. "And if you're part of a group, the theory is that you'll perform better as a borrower than if it was some disconnected credit card company."

Some prominent venture capital firms, including Accel Partners and Benchmark Capital, have rallied around the idea. Jim Breyer, an Accel partner who serves on the board of Wal-Mart Stores, is a Prosper director, as is Bob Kagle, a general partner at Benchmark, who also serves on eBay's board.

Mr. Larsen said the site's two-month testing period went well, and as of last week, Prosper had attracted lenders with a total of about $750,000 to lend.

Although Prosper is among the first to try this business in the United States, the idea has a track record abroad. Zopa.com, which operates in Britain, introduced a similar service in March (also with backing from Benchmark Capital) and has attracted more than 50,000 registered users, said Richard Duvall, Zopa's chief executive. At any given time, he said, about 15 percent of the users are either lending or borrowing money.

Mr. Duvall would not disclose the privately held company's revenues, but said he was "very pleased with our numbers" — so much so that he planned to start a site in the United States to compete with Prosper this year. Mr. Duvall said Zopa would also soon let users affiliate in groups, as Prosper does.

According to Asaf Buchner, a financial services analyst with the Internet consultancy Jupiter Research, that component could be critical to these sites becoming profitable.

Mr. Buchner notes that Prosper's group leaders receive a commission on the group's lending and borrowing activities, which they sometimes share among the group.

"If the sites are able to recruit strong group leaders with strong affiliations, they shift the marketing burden to those people, who have the incentive to go after others to become part of the group," Mr. Buchner said.

The group approach enticed at least one of Prosper's lenders, Stephen Russell, who registered with the site during its testing phase, and who is the brother of a Prosper engineer. Mr. Russell, the chief executive of a San Francisco technology company, 3VR Security, has put up $25,000 to invest on the site. He has also started a group to lend money to people affiliated with the Climb High Foundation, which trains women in tourist destinations to become climbing and trekking guides.

"I'm not just optimizing the rate of return on my assets," Mr. Russell said. "It's also a way to facilitate lending that'll help women in developing countries. That takes the lending and borrowing process one step further."
http://www.nytimes.com/2006/02/13/te...gy/13ecom.html





PC Tax Could Replace TV Licence
John Leyden

The BBC licence fee could eventually be replaced by a tax on having a PC instead of owning a TV, according to a Green Paper delivered this week. The government plans to retain the license fee for at least ten years but ministers are looking ahead to a time when high-speed broadband connections routinely deliver digital television channels to the nation's homes. In that event a fee based on television ownership could become redundant and the government could look at other ways to raise revenue, from subscriptions to taxing other access devices.

In a statement (http://www.culture.gov.uk/global/pre.../archive_2005/ dcms_green_paper_statement.htm) to Parliament this week, Culture Secretary Tessa Jowell said that "the changes in TV technology that will soon result in a wholly digital Britain... perhaps the greatest challenge the BBC has ever faced." The Times reports that a legal loophole means consumers could watch television or listen to radio over the net without having to pay a license fee, leaving the BBC with a funding shortfall that could run into the millions.

A Department for Culture, Media and Sport Green Paper (http:// http://www.bbccharterreview.org.uk/h...aper_home.html) on the BBC's long-term future proposes an end of the traditional license fee and "either a compulsory levy on all households or even on ownership of PCs as well as TVs". It cautions that these fees might be tough to enforce. Ministers are also consulting about the possibility of introducing a subscription model.

The Government reckons changes to the license fee will not be needed until 2017, when the BBC's next royal charter expires. However unnamed sources at the Department for Culture told The Times that the government would act earlier if viewing TV on the net became a hit with consumers. In August 2004, the BBC broadcast video clips from the Olympic Games over the net as an experiment. Six million UK homes currently have broadband connections, a figure that can only grow over time, spurring demand for innovative service like broadcasting over the internet. The majority of UK households will be watching TV over the internet by 2012, regulator Ofcom predicts.
http://www.theregister.co.uk/2005/03/03/pc_tax/





RIAA Bans The Reselling Of iPods With Preloaded Music

Although it may seem like a feasible idea, the Recording Industry Association of America (RIAA) says that reselling an iPod or MP3 player with music already preloaded on it is illegal.

"Selling an iPod preloaded with music is no different than selling a DVD onto which you have burned your entire music collection," the RIAA said in a statement to MTV.com. "Either act is a clear violation of U.S. copyright law. The RIAA is monitoring this means of infringement. In short: seller beware." Many people have been selling their used iPods online with thousands of songs preloaded on them.

Andrew Bridges, a lawyer for eBay that specializes in copyright and trademark law, told MTV.com, "It really depends on individual circumstances. I'm not sure the law is settled. If I'm a college student and I want to supplement my income by buying 100 iPods and selling them at a significant premium, that's probably not going to fly. But if I've had my iPod Shuffle for two years and I'm tired of it and I go out and buy a 60 gig video iPod and want to sell my old Shuffle, but don't want to purge the music first, that's probably legal."

Bridges said that he is not aware of a legal case that deals with this issue, but the law does not have strict guidelines in this instance. "Normally, only a copyright holder has the right to distribute copies of a work," said Bridges. "There is a very clear provision in the statue that says if you are in possession of a copy that has been lawfully made, you can distribute that copy without violating the copyright holder's copyright. That seems to suggest that there shouldn't be a case against a casual user disposing of copies they made for personal use when one is getting rid of one's own iPod."

On the other hand, RIAA President Cary Sherman disagrees. "Both cases Andrew cites are different types of infringement, it's just that the damages are higher for someone engaged in it for commercial benefit versus someone who isn't," he told MTV.com. "Unlawful reproduction or distribution is infringement. There is no fair use when someone is getting a complete copy of a work, especially a creative work and especially when it could have an adverse impact on the marketplace for selling or licensing that work."

A seller who had video iPods on the eBay market preloaded with over 6000 songs has already been contacted by the RIAA. Moreover, the RIAA is reaching a system of agreement with eBay where people who try to sell loaded iPods will get a warning.

The RIAA also addressed the issue of brand new iPods being sold with preloaded content on them, like Boston's TvMyPod which sells video iPods preloaded with DVD content the customer has purchased. TvMyPod's owner, Vijay Raghavan, said that his business is not breaking the Millennium Copyright Act because the customer gets the original and the copy and the DVDs do not get decrypted in order to load them onto the iPod.

Sherman said that the RIAA's hands are tied in this case. He said that technically they are not allowed to do without a license, but there is no such license that exists.
http://www.fmqb.com/Article.asp?id=174065





RIAA Says Ripping CDs to Your iPod is NOT Fair Use
Fred von Lohmann

It is no secret that the entertainment oligopolists are not happy about space-shifting and format-shifting. But surely ripping your own CDs to your own iPod passes muster, right? In fact, didn't they admit as much in front of the Supreme Court during the MGM v. Grokster argument last year?

Apparently not.

As part of the on-going DMCA rule-making proceedings, the RIAA and other copyright industry associations submitted a filing that included this gem as part of their argument that space-shifting and format-shifting do not count as noninfringing uses, even when you are talking about making copies of your own CDs:

"Nor does the fact that permission to make a copy in particular circumstances is often or even routinely granted, necessarily establish that the copying is a fair use when the copyright owner withholds that authorization. In this regard, the statement attributed to counsel for copyright owners in the MGM v. Grokster case is simply a statement about authorization, not about fair use."

For those who may not remember, here's what Don Verrilli said to the Supreme Court last year:

"The record companies, my clients, have said, for some time now, and it's been on their website for some time now, that it's perfectly lawful to take a CD that you've purchased, upload it onto your computer, put it onto your iPod."

If I understand what the RIAA is saying, "perfectly lawful" means "lawful until we change our mind." So your ability to continue to make copies of your own CDs on your own iPod is entirely a matter of their sufferance. What about all the indie label CDs? Do you have to ask each of them for permission before ripping your CDs? And what about all the major label artists who control their own copyrights? Do we all need to ask them, as well?

P.S.: The same filing also had this to say: "Similarly, creating a back-up copy of a music CD is not a non-infringing use...."
http://www.eff.org/deeplinks/archives/004409.php



RIAA et al. Says CD Ripping, Backups Not Fair Use
Ken "Caesar" Fisher

If anyone has any doubts about the content industry's resolve to destroy fair use and usher in new ways of charging you for uses that were previously both free and fair, look no further. As part of the triennial review of the effectiveness of the DMCA, a number of content-related industries have filed a joint reply (PDF) with the government on the effectiveness of the DMCA and the challenges that lay ahead for copyright. As you might expect, the document is a celebration of the DMCA, and the industries are pushing for even more egregious abuses of technology to fatten up their bottom lines.

With regards to the argument that the DMCA is bad law because it prevents users from making backups, the joint reply dismissed such arguments as "uncompelling." First, they argue that there is no evidence that "any of the relevant media are 'unusually subject to damage in the ordinary course of their use.'" This "cart-before-the-horse" argument suggests that people do not need to backup anything that does not have a high failure rate—a view that fundamentally misunderstands the purpose of backups. Furthermore, they argue that the success of DVD sales vis-à-vis VHS demonstrates that whatever problem there might be, it's not big enough to matter to consumers, because DVD sales are skyrocketing while VHS isn't. Thus high sales volumes are indicators that the consumer are well served, which is an argument that we'll hope never takes hold in the pharmaceutical industry (Vioxx sure did sell well!).

Such are the lengths they will go through in order to keep the anti-circumvention provisions of the DMCA intact. But supporting the status quo isn't in their interest. No, the idea is to embrace and extend. To wit, the joint reply also argues that making backups of your CDs is also not fair use.

The [submitted arguments in favor of granting exemptions to the DMCA] provide no arguments or legal authority that making back up copies of CDs is a noninfringing use. In addition, the submissions provide no evidence that access controls are currently preventing them from making back up copies of CDs or that they are likely to do so in the future. Myriad online downloading services are available and offer varying types of digital rights management alternatives. For example, the Apple FairPlay technology allows users to make a limited number of copies for personal use. Presumably, consumers concerned with the ability to make back up copies would choose to purchase music from a service that allowed such copying. Even if CDs do become damaged, replacements are readily available at affordable prices. Similar to the motion picture industry, the recording industry has faced, in online piracy, a direct attack on its ability to enjoy its copyrights. (emphasis added)

As you can see, the argument is hinged partially on the cost of replacements. Why should you be allowed to make backups of CDs you've purchased when you can replace them? And why should CD backups be legal when users can already decided to purchase from (DRM-laden) services that do allow the limited copying of lossy music files? Here, again, we see the way in which the RIAA et al. would like to see contract law take over the domain of fair use. "Leave it up to DRM, you big dummies!"

But they're not done with that argument. The real kicker is buried in a footnote, where the joint reply suggests the unthinkable: that making copies of CDs for any purpose may, in fact, be infringement.

Nor does the fact that permission to make a copy in particular circumstances is often or even "routinely" granted, see C6 at 8, necessarily establish that the copying is a fair use when the copyright owner withholds that authorization. In this regard, the statement attributed to counsel for copyright holders in the Grokster case, is simply a statement about authorization, not about fair use.

Allow me to translate: just because people have been copying CDs in the past doesn't mean that that they had the authorization to do so, and a general trend does not override such explicit authorization. But as the EFF has picked up, the RIAA is engaging in a little historical revision. Their last comment about the Grokster case is attempting to change the substance of comments that were uttered by their own legal counsel. Why they would do this is abundantly clear when you see the statement in question:

"The record companies, my clients, have said, for some time now, and it's been on their website for some time now, that it's perfectly lawful to take a CD that you've purchased, upload it onto your computer, put it onto your iPod."

It looks like someone is having a change of heart.

In the world of the joint reply, if and when the RIAA and its member studios say that copying your CDs is not permitted, then it's not permitted. Forget fair use. Forget historical precedent. The joint reply here is arguing that copyright owners have the authority to deny what has become fair use—what their own lawyers have admitted is fair use in front of the Supreme Court of the United States. The upshot is that this argument suggests that the most common form of CD "copying"—namely ripping CDs for use on computers and portable players—is not necessarily fair use. The joint reply adds:

Similarly, creating a back-up copy of a music CD is not a non-infringing use, for reasons similar to those the Register canvassed in detail in her 2003 determination that back-up copying of DVDs cannot be treated as noninfringing. [Ed note: see above arguments.] While we recognize that access controls may in some circumstances affect copying, the fact remains that there is no general exception to the reproduction right to allow back-up copying (except the limited exception in § 117 for computer programs) and thus no justification for allowing circumvention of access controls for this purpose.

Inasmuch as the joint reply was grafted in defense of the DMCA, it remains unclear if the RIAA has any plans to take up this line of argument in front of legislators or the public. It does mark, however, yet another development in the erosion of fair use, and it demonstrates that the insidious notion of "customary historic use" stems from part of the industry's campaign to legislate new business models that fly in the face of fair use, the doctrine of first sale, and limited copyrights.
http://arstechnica.com/news.ars/post/20060215-6190.html





The Great HDCP Fiasco
Alan Dang

You want to know a secret? None of the current ATI or NVIDIA graphics cards will support the full capabilities of Windows Vista.

But let’s start from the beginning. This story starts with my upcoming LCD Monitor Round-Up. As you know, a good monitor should last several years and outlive every other component in your PC, other than perhaps a keyboard or a mouse. So, when it came time to do another review of LCD monitors, my attention turned towards “Windows Vista-ready” monitors: those with HDCP. After all, it makes no sense to recommend a monitor that will go obsolete in just a few months.

At the time I started my article, there were only 10 PC monitors with DVI/HDCP support (we’re reviewing 5 of them). I was disappointed, but what was surprising is that many of these monitor manufacturers weren’t advertising their HDCP support. For monitors, HDCP support is the most important feature for having a “future proof” solution.

What is HDCP?

HDCP stands for High-bandwidth Digital Content Protection and is an Intel-initiated program that was developed with Silicon Image. This content protection system is mandatory for high-definition playback of HD-DVD or Blu-Ray discs. If you want to watch movies at 1980x1080, your system will need to support HDCP. If you don’t have HDCP support, you’ll only get a quarter of the resolution. A 75% loss in pixel density is a pretty big deal – Wouldn’t you be angry if your car was advertised as doing 16 mpg, and you only got 4 mpg? Or if you bought a 2 GHz CPU and found out that it only ran at 500 MHz?

As part of the Windows-Vista Ready Monitor article, I was going to publish a list of all of the graphics cards that currently support HDCP. I mean, I remember GPUs dating as far back as the Radeon 8500 that had boasted of HDCP support.

Turns out, we were all deceived.

GPU Support for HDCP

Although ATI has had “HDCP support” in their GPUs since the Radeon 8500, and NVIDIA has had “HDCP support” in their GPUs since the GeForce FX5700, it turns out that things are more complicated -- just because the GPU itself supports HDCP doesn’t mean that the graphics card can output a DVI/HDCP compliant stream. There needs to be additional support at the board level, which includes licensing the HDCP decoding keys from the Digital Content Protection, LLC (a spin-off corporation within the walls of Intel).

After some investigation, Brandon and I determined that there is no shipping retail add-in board with HDCP decoding keys. Simply put, none of the AGP or PCI-E graphics cards that you can buy today support HDCP.

I did not believe this at first. Surely, I was misinterpreting the content of the emails I was receiving. After all, everyone is hyping up H.264 support and HD-DVD/Blu-Ray playback. When I go to http:// www.ati.com/products/RadeonX1900/specs.html I see HDCP support listed. Am I supposed to know that the board doesn’t support it because I can go to http://www.ati.com/products/radeonx1900/ radeonx1900xtx/specs.html and see that HDCP is omitted? If that’s the case, am I supposed to know that the board has “48 shader processors” when it’s only listed in the GPU specifications page?

What we’ve confirmed

We’ve been able to confirm that none of the Built-by-ATI Radeons support HDCP. If you’ve just spent $1000 on a pair of Radeon X1900 XT graphics cards expecting to be able to playback HD-DVD or Blu- Ray movies at 1920x1080 resolution in the future, you’ve just wasted your money.

NVIDIA, being a GPU manufacturer was unable to discuss the plans of board manufacturers. We contacted all six of NVIDIA’s Tier-1 board partners. None of the GeForce 6 or 7 video cards available on the market, including the most recently released GeForce 7800GS, have HDCP support. So if you just spent $1500 on a pair of 7800GTX 512MB GPUs expecting to be able to play 1920x1080 HD-DVD or Blu-Ray movies in the future, you’ve just wasted your money.

How can these companies be so oblivious? Playing Devil’s Advocate, I thought to myself that maybe, just maybe, by the time Windows Vista comes out, most people are going to upgrade their GPU. If the HDCP support was very expensive, then paying for the HDCP license now would be like paying for something you don’t use. So I dug around for HDCP licensing costs. Turns out, that the answer is available at the HDMI website. HDCP licensing requires a $15,000 annual fee and a per-device fee of $0.005, i.e. a fraction of a cent. That’s not too expensive. There goes that argument.

Upgrade path for HDCP?

Video cards are the only components in a PC that have gone up in price over time. Yet manufacturers are trying to sell video cards that don’t support HDCP? The technology has been around for years. Microsoft made it public in March 2005 that HDCP would be required for Windows Vista and reiterated it again in April 2005 – certainly the video card manufacturers were given this info before the public were. Moreover, what about companies who are already paying the $15,000 annual company fee because they produce HDCP-compliant products for televisions?

Despite my discovery that HDCP licensing is fairly cheap, I’m still trying to find an answer. There must be a silver lining somewhere. Maybe, just maybe, existing cards can be retrofitted for HDCP support. Maybe it’s simply a matter of a BIOS flash where each board gets its own serial number. If that were true, the worse case scenario would be that customers would pay a few bucks for the HDCP license.

Turns out that this was also wishful thinking.

An ATI representative said: “People will not be able to turn on HDCP through a software patch since the HDCP keys need to be present during the manufacturing. We are rolling out HDCP through OEMs at this time but we have not finalized our retail plans yet.”

As I pressed for more information about potential retail plans (i.e. trade-in programs, whether existing boards already have traces for the HDCP hardware where it can be plugged in), I got only a vague response:

“We cannot get into more detail at this time, as any further discussion would get into our trade secrets. However, we do promise to give you a full update on our retail plans once they are finalized.”

I’m not going to speculate on whether ATI’s reticence is because they’re trying to downplay a big fiasco, or if they’re trying to keep their super generous solution secret to throw off the competition. There’s actually no way to know.

Well, what about NVIDIA? They were actually very direct: “The boards themselves must be designed with an extra chip when the board is manufactured. The extra chip stores a crypto key, and you cannot retrofit an existing board after the board is produced.”

Wow. You can pick your favorite expletive.

The blame game

Blame Canada?

As ATI is a GPU and board manufacturer, I’m disappointed that Built-by-ATI video cards lack HDCP support. Think about it. The GPU engineers are smart enough to know that their GPUs need to support HDCP, but their board engineers aren’t? Is it even possible to build a GPU without thinking about the board that has to go along with it? ATI is extremely reticent to give us any more details about “Retail Plans.” Maybe ATI owners will get lucky, and ATI will have some sort of free upgrade program. Maybe ATI owners will get shafted, and buyers of X1900XT’s are going to find themselves with a video card that cannot play HD-DVD or Blu-Ray at 1920x1080. Who knows?

Blame Santa Clara?

What about NVIDIA? Personally, I think they have the least blood on their hand for two reasons. One, they aren’t a board manufacturer. That excuse alone wouldn’t be good enough for me though.

What really gets them off the hook is that NVIDIA has been offering their board manufacturing partners designs with HDCP support since May 2005. Likewise, NVIDIA has actually shipped HDCP-enabled GeForce 6200 and 6600’s in Sony Media Center PCs. Those boards just aren’t manufactured at retail. In retrospect, they did their part. It was the board manufacturers who failed us. I don’t need to name names, because they ALL failed us.

Blame the other Santa Clara company?

HDCP is the brain-child of Intel, and now belongs to a spin-off company, Digital Content Protection, LLC. They’re the ones who profit off all of the licensing fees. If HDCP licensing were cheaper, might we have seen more PC products with HDCP support? Possibly. It still seems to me that HDCP has relatively benign pricing when it comes to licensing. It's half a cent per item. If you compare that to licensing fees for HDMI, you'll see that while both have the same $15,000 annual fee, HDMI licensing is 4 cents/per unit (if you use the maximum discount as an example). Should we blame Intel for creating HDCP in the first place? I don’t think so. HDCP was a technology made in response to Hollywood’s requests. Blue laser technology can only go so far without content.

Blame Hollywood?

HDCP is an artificial requirement – there’s no reason why HD-DVD or Blu-Ray needs content protection. Although the movie industry is among the wealthiest of all industries, Hollywood has made things tougher in their paranoia of software piracy. Can we blame Hollywood for demanding HDCP? Maybe a little bit, but they’re not responsible for this current fiasco. Movie studios have done their fair part to make high-definition home video a possibility. From the get go, Hollywood made it clear that content protection was going to be necessary for high-definition video and they gave the electronics industry ample warning. HD-DVD and Blu-Ray are coming in 2006. Television manufacturers have been putting HDCP into HDTVs from as far back as 2002. While Hollywood is certainly responsible for pressuring Microsoft into requiring HDCP for Windows Vista, they set their ground rules early on.

Is it our fault?

Think about it. If consumers and reviewers didn’t use the terms GPU and graphics card interchangeably, this wouldn’t be a problem. When it was disclosed that Microsoft required HDCP for high-definition HD-DVD or Blu-Ray playback in Windows Vista, everyone turned their attention to monitors, assuming that GPUs would support it. We all know the what happens when you assume. Likewise, why didn’t reviewers investigate if features in a GPU actually made it to the board level? Most importantly, we as consumers never clamored for HDCP support.

So in a way, even consumers are at fault, right? No way. Only the truly twisted would claim that the victims brought it upon themselves. Do any of us “ask” for Direct3D or OpenGL support? It’s a given. Consumers never demanded HDCP support because it was already thought to be there.

Alan's thoughts

This is a tough situation. The PC world simply isn’t ready for high-definition video playback via HD-DVD or Blu-Ray. There failures occurred at so many different levels. I’ve probably burned a few bridges in this article, and I probably won’t be reviewing any video cards in the near future. Nonetheless, this was a train that had already left the station. Keeping quiet about the problem wouldn’t have stopped the customer outrage when Windows Vista was released. The solution to this problem isn’t technical. It’s political. I hope that board manufacturers will own up to the challenge and explain their actions to their customers. There's still time to come up with a solution.

Brandon’s thoughts

Without a doubt, this is huge, startling news. As much as ATI and NVIDIA have been promoting H.264 decoding with their latest GPUs, it’s pretty shocking to see that apparently none of the shipping retail cards on the market have been built to take advantage of it. To add insult to injury, it appears that a line of Sony GeForce 6200s and 6600s offer HDCP support, yet the latest high-end GeForce 7800 GTX cards don’t. How’s that for irony?

While some of you may not plan on upgrading to Vista at the end of this year, this is eventually going to affect you if you ever planned on watching hi-def movies on your PC in the future. Microsoft will eventually end support for Windows XP; already, their Games Division is planning Vista-exclusive titles such as Halo 2. It will only be a matter of time before other software developers follow suit, forcing anyone who’s remotely interested in gaming to upgrade to Windows Vista.

Anyone with a GeForce 6/7 or Radeon X1K card who was planning on buying a BD-ROM or HD-DVD drive later this year for their PC may want to hold off on that purchase. Quite frankly, this article should affect the purchasing decisions of potentially anyone in the market for a new PC or graphics card right now that’s even remotely interested in watching hi-def movies on their PC sometime in the future.
http://www.firingsquad.com/hardware/..._hdcp_support/





Google Video DRM: Why Is Hollywood More Important Than Users?
Cory Doctorow

With the introduction of its new copy-restriction video service, Google has diverged from its corporate ethos. For the first time in the company's history, it has released a product that is designed to fill the needs of someone other than Google's users.

Google Video is a new video-search and video-sales tool, through which users can download videos that have been uploaded by their creators or by others who have the rights to them, either because the videos are in the public domain, or because they are used in a way that satisfies the "fair use" defense in US copyright law.

Part of the Google Video offering is a store that sells videos. Some of these are delivered in a locked format of Google's devising that restricts how Google's users can play and use the videos they buy. This Digital Rights Management system (DRM) is like many of those used by Google's competitors in that it doesn't attempt to model any copyright system in the world, but rather reflects a one-sided vision of how copyright should work and imposes that unilaterally on Google's customers.

Here's how the Google Video DRM works: when you download a restricted video from Google, it locks that video to your account and software player. Every time you want to play the video, your player has to communicate with Google to determine whether you are currently permitted to play it; if the player doesn't get the answer it's looking for, it won't play the video. The specifics of how this works aren't available -- Google hasn't published any details of how the security is implemented, committing the cardinal sin of "security through obscurity."

The video is encrypted (scrambled), which means that it is unlawful for competitors of Google (or free/open source software authors) to make their own players for the video, even if they can figure out how to decrypt it. Other DRM vendors, like Apple, have threatened to sue competitors for making players that can play their proprietary file-formats.

Why Has Google Done This?
The question is, why has Google done this? There's no Google customer who woke up this morning looking for a way to do less with her video. There's no Google customer who lacked access to this video if he wanted it (here's a tip: enter the name of a show or movie into Google and add the word "torrent" to the search, and within seconds Google will have delivered to you a link through which you can download practically everything in the Google DRM catalog, for free, without DRM -- although it may be illegal for the person you get it from to send it to you).

That's not to say that there's nothing problematic about getting your video through Google this way. But the problems of the inability of the entertainment industry to adapt to the Internet are the entertainment industry's problems, not Google's. Google's really good at adapting to the Internet -- that's why it's capitalized at $100 billion while the whole of Hollywood only turns over $60 billion a year.

But once Google starts brokering the relationship between Hollywood and their audience, this becomes Google's problem too, which means that all the absurd, business-punishing avenues pursued by Hollywood are now Google's business, as well.

It appears that the main reason Google got involved in DRM was to compete with Microsoft and Yahoo, both of whom have created online video stores with movies and shows from major entertainment companies. These companies demand that their works be locked away in wrappers that restrict users in ways that have nothing to do with copyright law and so if you want a license from them, you've got to play ball, even though no customer wants this. You can't exactly put your offerings online under a banner that says, "Now with fewer features!"

This Time, Google's Users Don't Come First
This isn't the first time Google's had a major industry demand that it design a product in a way that didn't put Google's users front and center. As documented in John Battelle's excellent book The Search, there was a strong push on Google in the early days to adopt graphic advertising banners for the site. All of Google's competitors were doing it, making a fortune at it, and no one wanted to advertise via text-ads even though its users clearly found them them less invasive than graphic banners.

But Google hewed to a brilliant and successful strategy of never putting a supplier's need above its searchers' needs. This, more than Google's controversial "Don't be evil" motto is the true force driving its most successful offerings. Google refused to graphic ads and only accepted ads from suppliers who shared its view of how to deliver a quality service to its users.

Abandoning this is a terrible idea and one that's exacerbated by design decisions in Google's DRM technology. The outcome is a Google service that opens the company and its users to unprecedented new risk.

Google DRM and Copyright
Google's DRM has the potential to drastically re-shape the contours of copyright law, turning a few entertainment companies' wishful thinking about the way that copyright would work if they were running the show into de facto laws.

Some examples of user-rights that Google Video DRM takes away:

Under US copyright law, once you buy a video, you acquire a number of rights to it, including the right to re-sell it, loan it to a friend, donate it to your kid's school and so on. But with Google Video DRM, none of this is possible: your video is locked to your account and player.

Educators, archivists, academics, parodists and others have the right to excerpt, copy, archive and use any video in their work, under the US doctrine of fair use. However, Google's DRM tool stops them from doing this, and Google's video can't be played on anyone else's tool.

When I questioned Google Video's Peter Chane about this, he said that Google DRM is "user-friendly" -- but none of the user rights embodied in the US copyright law are accommodated by Google's DRM. Google's view of "user-friendly" only encompasses the design of the user-interface, not the rights that users enjoy under the law.

Revocation and Changing the Deal
Google DRM player can be "revoked" -- field updated without user permission or intervention. This isn't the standard in media players -- for example, iTunes requires that you explicitly grant permission to the application before it updates. Where auto-update prevails, the possibility for abuse is dramatic -- for example, a magistrate once tried to get ReplayTV to field-update the units it had sold to monitor its customers' use of the device as part of a dispute about the legality of one of its features. The idea was that the spyware would be implemented to gather the information required for the trial. The owners of ReplayTVs were the potential victims there, having products they'd purchased crippled after the fact (a judge overturned the magistrate's idea before it could be implemented, but other companies, such as AOL, have been forced to field-update their software to court order).

Google DRM auto-updating raises the possibility that some day the same thing might happen to them -- either because Google was ordered by a court to do so, or because one of Google's customers responds to news of Google's DRM being defeated (Chane and other DRM manufacturers universally acknowledge that all DRMs will eventually be subverted by their attackers) with a demand to "update" the software in a way that changes what few rights Google does give you when you buy your movies from them.

Google won't comment on whether they've entered into any arrangements with their suppliers that would require them to do this, and there lies the problem. Your ongoing enjoyment of the property you buy from Google is dependent on their ongoing relationship with their suppliers. If you buy a Warner Brothers DVD from Tower Records, it doesn't affect you in the least if Tower and Warners have an ugly dispute. You've bought it, it's yours. But with Google DRM, auto-update means that it's never really yours. Third parties always have the possibility of taking away the rights you bought, after you bought them.

Alternative Players
DRM systems are protected by the Digital Millennium Copyright Act (DMCA), a 1998 law that makes it illegal to break them. That means that where a DRM is in place, no competitor can reverse-engineer your player and make a compatible one -- something that is otherwise lawful.

DVDs were the first widely-released DRM media. The effect of DRM on DVDs was to deprive DVD owners of the fruits of an open market in players. In the ten years that DVDs have been in the marketplace, no new features have been introduced for the platform, robbing us of the dividends on our investment in DVDs. By contrast, DRM-free CDs ushered in the era of the MP3, home karaoke, time-shifting, media servers, iPods, mashups, MP3 CDs and all the rest of the value that has accumulated in our music collections, the dividend paid on our investment in the CD format.

But even DVDs are less restrictive than Google DRM. DVD players can at least be manufactured by anyone willing to enter into a restrictive contract with DVD-CCA, a licensing body that controls the keys and patents for DVDs.

Google has no licensing program at all, and no publicly disclosed plans for developing such a program. In other words, your Google movies only play on Google's player, and no one but Google gets to make a Google player.

This is particularly worrisome in the case of the Google DRM system because it requires that you have a live Internet connection to Google every time you want to play a movie. That means that every time you watch a Google DRM movie, they get a record of your viewing. What's more, if you're not on the Internet, or if Google's servers are unreachable, you can't watch your movies. Google competitors aren't anywhere near this onerous with their DRM -- Netflix doesn't know when you watch a DVD; even Microsoft doesn't gather this much information on your video-watching habits. TiVo erases all personal information before aggregating its viewer stats.

And if Google goes bankrupt (stranger things have happened -- just ask anyone who ever bought and loved a Commodore computer), that's it, game over. No authentication server to approve your video viewing, no alternative player that skips the authorization step, and no legal way to make such a player. (Google says that it's working on a version with offline viewing capability, but this isn't present in the current version of its DRM)

That said, it's a near certainty that alternative Google players will be developed -- though the legality of these players is unclear. Nevertheless, just as with DVDs and iTunes, players like VLC and converters like DVD X- Copy will surely emerge for Google DRM. Will Google sue the people who make these players?

The company won't say. They do say that they prefer to use their field- update capability to break the compatibility with these players, but one wonders whether this will be much better, from a user-centric point of view. After all, if you buy or download a tool that lets you enjoy your lawfully acquired movies in a lawful way, what business does Google have in reaching into your computer to take that away from you?

What Else Could Google Have Done?
Has it come to this? Has Google gone from being a company where the customer always comes first to a company where "what else could we have done?" is the order of business?

Of course, there are lots of things Google could have done. It could have digitized all the movies and shows that are presently in its store with DRM and simply indexed them with links to buy them on Amazon, just as it's done with millions of books through its astonishing and wonderful Google Book Search program.

It could have concentrated on indexing only videos that are found in the wild on the Internet, and selling only videos that come from rightsholders who don't want to shaft Google's customers -- repeat the strategy it pursued when it stuck to its text-ad guns and refused to go with graphic banners.

It could have delivered tools that you use, in your home, to index your personal video collection -- a Google toolbar for the media in your living room.

It could have done all or none of this. But by choosing to copy the mistakes of its competitors, Google has put its destiny in the hands of an industry where treating customers like criminals is the order of the day -- these are the companies that search cinema-goers and make them leave their cameraphones with the usher, after all.

These companies don't want Google to succeed at DRM. That would give Google too much bargaining power in licensing agreements (see how much power Apple has accumulated through the penetration of its lock-in DRM suite -- iTunes, iPods and iTunes music -- the music industry's attempts to change their licensing terms with Apple have been laughed out of the Cupertino board-rooms). The entertainment companies prefer consortia of battling companies that can't come out with a coherent bargaining position.

Take DVD Blu-Ray and DVD-HD: there we have two technology consortia warring to deliver the worst product they think they can sell. The format with the most restrictions has been promised the sweetest licensing deal for content. Blu-Ray recently announced that it would add region coding (locking DVDs to playback on players bought in the same country as the disc) to its final specification -- after years of insisting that region coding just frustrated honest users.

Google DRM doesn't come from a fragile consortium, so it isn't supposed to be a winner: it's supposed to be a strategic tool to weaken the power of Yahoo and Microsoft's DRM (also not supposed to be winners). The ultimate trajectory for DRM is in consortia like Coral, where all the losers in the DRM format-wars have been gathered together by the entertainment companies, who've promised them preferential treatment if they'll help overturn the Macrovisions, Microsofts and Apples of the DRM market.

There's no way Google can win the DRM wars. The end-game for the entertainment companies is to use the sweet lure of content to turn Google from an unmanageable giant into a biddable servant, dependent on long- term good relations with its licensors to preserve its customers' investment in its video.

The only way Google can win this game is not to play at all. The only way Google can win is to return to its customer-comes-first ethic and refuse any business-arrangement that subverts its customers' interests to serve some other industry's wishes.
http://www.boingboing.net/2006/02/14...o_drm_why.html





Hollywood vs.Your PC: Round 2

Legal options in digital entertainment are growing. But they come with restrictions that can hobble your ability to enjoy the content you've paid for--and even threaten your control over your system.
Dan Tynan

As we move to a world where all entertainment is delivered digitally, the battle over copyright protection is turning into a full-blown war. And consumer rights may end up being the biggest casualty as media companies hunker down and try to redefine what users can and can't do with the content they've paid for and the hardware they own.

From Apple's iTunes and Real Networks' Rhapsody music network to movie rental sites like CinemaNow and Starz' Vongo, legitimate digital media services are exploding. But each additional option brings a new battle, new restrictions, and even new dangers for unsuspecting users. Copy protection included in Sony BMG audio CDs allowed virus writers to co-opt the system and sneak onto users' PCs. Satellite and HD Radio, which promise higher-quality audio and more content, may become difficult for listeners to record if the music industry has its way. And TV fans are finding that cable stations are limiting their ability to time-shift shows; pending federal legislation may curtail their rights even more.

Worse, since we last looked at this battle in 2002, technology firms, which once struck a balance between the rights of content owners and the rights of users, have sided more and more with Hollywood as they strive to secure the content they believe will help sell their products.

We'll look at the multiple fronts of the digital wars--from file sharing to music to TV--and give you a hint of what's next.

Copyrights and Wrongs
Musical Discord
Digital TV Behind Gates
Vista Blurs High-Def
Playing Fair
Digital Media Faq

Copyrights and Wrongs

Peer-to-peer file sharing remains the bogeyman, driving entertainment companies toward ever- increasing control over content. Despite the U.S. Supreme Court decision holding Grokster liable for the actions of its copyright-defying users, and despite more than 13,000 lawsuits filed by the Recording Industry Association of America and the Motion Picture Association of America, file swapping is still growing. According to P-to-P research site Big Champagne, some 6.5 million U.S. users share files at any one time--up more than 30 percent from the year before.

Media companies have responded in two ways. Using their influence in Washington, D.C., they've pushed for laws friendlier to the rights of content owners. At the same time, Hollywood has threatened to withhold access to its libraries unless electronics manufacturers build devices with sufficient copy protection.

This is not the way the copyright process was supposed to work, according to Jessica Litman, author of Digital Copyright (Prometheus Books, 2001).

"Copyright law was intended to protect reading, viewing, and listening as much as creating and distributing," says Litman, a professor of copyright law at Wayne State University Law School. "Now it takes what people previously saw as their rights and treats them as loopholes the copyright owners will close, if they can."

Take books, for example. You can read a book anywhere you want, skip chapters at will, give the book away or sell it, quote portions of it on your blog, or scan it into your PC and print out a copy. And when the book eventually becomes part of the public domain, you can do anything you please with it--including printing copies and selling them at a profit.

Buy an electronic book, however, and your rights start to wither. You're now subject to the terms of an end-user license agreement. Depending on the EULA, you may be able to read the book on only a limited number of machines (usually just one), and you probably won't be allowed to sell it, lend it, or make backup copies.

As you move up the content spectrum to digital music, movies, radio, and TV, the rules can be just as restrictive.

"[Hollywood's] model is to make experiencing copyrighted material--reading a book, listening to music, or watching a movie--legally like going to a movie theater," Litman says. They want you to buy a ticket, watch ads, eat only their food, leave when they want you to, and pay for it all again each time you do it, she says.

Brad Hunt, senior vice president and chief technology officer for the MPAA, disagrees, arguing that content owners are seeking ways to offer users more options than they have with today's media. "Instead of saying 'here's the movie locked to a piece of plastic, take it or leave it,' content owners may make other rights available to you to do more with it," he explains.

Musical Discord

The primary battleground for digital content has long been music. To combat widespread file swapping, the record industry has attempted both copy protection for CDs--most notoriously in the form of Sony BMG's XCP rootkit (see "Copy Controls: How Far Will They Go?" for more)--and digital rights management schemes for online music. Each has made life more difficult for legal purchasers of music.

Usually, copy-protected CDs don't prevent you from making copies so much as they limit how many copies you can make and where you can make them. If you played a protected Sony CD on your PC, for example, you could rip three copies of the CD to your hard drive. If you then put this music into your Windows Media Player library, you could burn three other CDs. But Sony's XCP scheme prevented iPod fans from easily copying MP3s from the CD to their music libraries, though a workaround was available upon request.

Online music rules are even more complex. You can play music purchased from iTunes on up to five systems, for example, but if you want to add a sixth, you have to log on to one of the other machines and "de-authorize" it. You can burn a playlist to a CD, but no more than seven times. You can share tunes across five computers on a local network, but the other users can only listen to the music. Still more restrictive are the rules for iTunes' video downloads--there's no sharing at all.

Yet as DRM schemes go, iTunes' FairPlay system is fairly transparent, Jupiter senior analyst Joe Wilcox notes. "People know it's there only if they try to violate it," he says, adding that with Windows DRM, he's had problems with both legit music playback and the purchasing process.

Moreover, incompatible DRM schemes can lock users into a particular technology. If you purchase your music from iTunes, realistically you have two options: to buy iPods for the rest of your life--since iTunes music won't play on other players--or to ditch your library and start over. Players that support Windows Media Audio DRM are more plentiful, but similar restrictions apply to them.

Later this year, new DRM technologies may challenge the hegemony of FairPlay and WMA, says Bill Rosenblatt, president of GiantSteps Media Technology Strategies and editor of DRMwatch in New York. One approach, the Marlin DRM scheme, is based on personal identity: It would let you access content on a variety of portable devices according to who you are, not what device you're using. Another DRM platform, code-named Coral, would allow service providers to convert content from one DRM format to another, making it playable on a wider variety of devices. Both schemes are backed by two closely allied consortia whose members include 20th Century Fox, Hewlett-Packard, Philips, and Sony.

Navio, a small Silicon Valley startup, is taking yet another tack. Instead of buying digital files, users, in Navio's scheme, buy the rights to enjoy them. So when a user is at work but wants to hear a song that he downloaded at home, he can log in to Navio, which confirms that he has rights to the song and allows him to download or stream the song to a new device. Files can still use DRM technology to prevent unfettered file swapping, while consumers get many of the same freedoms they've grown used to with analog content.

"If the rights are properly defined and ubiquitous, they'll become more valuable to consumers than the actual files," says Navio CEO Stefan Roever. Then only people with no money and lots of time will fool around with file sharing, he adds.

Navio already enforces media rights for the Fox Sports and Fox Music Web sites, and at press time it was preparing to announce a deal with a major record label.

Meanwhile, another front is opening in the war over digital music: The RIAA is pushing for legislation that would prohibit listeners from recording or sharing individual songs broadcast via new digital radio services unless they paid a fee for each song. Nevertheless, the group favors being able to record digital radio in blocks of 30 minutes or longer.

"We support time-shifting," says RIAA spokesperson Jenni Engebretsen, but not "cherry-picking individual songs and storing them in a library on an MP3 player in a manner that substitutes for a sale."

According to Public Knowledge, a consumer rights group based in Washington, D.C., such rules would extinguish fair-use rights that listeners have enjoyed in the past--there are no such restrictions on the right to record personal copies of songs from traditional radio broadcasts.

Digital TV Behind Gates

The battle over rights in the digital TV arena is already well under way. By March 1, 2007, according to Federal Communications Commission rules, all new TV devices (tuners, VCRs, DVRs, and set-top boxes) for sale in the United States must be capable of receiving digital TV signals. For the past few years, media conglomerates have been scrambling to keep their expensively produced, highly profitable digital content from drifting all over the Net. But the protections they've devised may keep viewers from doing things they are accustomed to doing--such as recording, time- shifting, and sharing shows.

In 2003, the FCC ruled that over-the-air digital TV shows must carry an 8-bit "flag" that broadcasters could use to limit how viewers recorded such programs; all TV gear would have had to recognize this flag. But last May, a federal court struck down the broadcast flag, ruling that the FCC had exceeded its authority. Flag supporters have tried to persuade Congress to authorize the flag; that has yet to happen.

The MPAA's Hunt says such controls are necessary. "If content owners have no assurance there will be some form of protection from redistributing digital TV, that high-value content normally provided to broadcasters would move into the pay-TV world," he says. That could mean networks like ABC and NBC might no longer get the rights to show Star Wars or Harry Potter movies, for example.

Meanwhile, TiVo owners recently got a taste of what life under such a flag might be like. Last September the popular DVR service changed how it responded to the Macrovision copy protection built into pay-per-view and video-on-demand content. For the first time, content owners could prevent viewers from recording PPV and VOD shows on a DVR. They could also require deletion of shows from the recorder after a certain period. TiVo already prevented viewers from burning protected content to DVDs or using the TiVoToGo service to transfer it to a PC.

Fred von Lohman, senior staff attorney for the Electronic Frontier Foundation in San Francisco, says that this change is a classic case of content owners taking away features consumers have paid for.

"Two years ago the TiVo you bought did one thing, and now suddenly it does something different," he says. "Despite the fact we're buying more media than ever before, products are treating us more and more like pirates each day."

But TiVo VP of product marketing Jim Denney says the changes have had little impact on the vast majority of TiVo users.

More restrictions may be on the way for home recording. At press time, sponsors had just introduced the Digital Content Security Act (HR 4569) in the House. This bill would close the "analog hole" by requiring devices that allow users to make digital copies from analog sources to employ copy protection technology. If the analog hole were closed, protected shows could carry signals that prevented them from being copied by any device at all, or could limit copies and prohibit them from being digitally redistributed, or could restrict viewers' time-shifting abilities to within 90 minutes after a broadcast.

Next-generation home recording via high-capacity blue-laser DVD technology promises a little more freedom but also additional restrictions. Both Blu-ray and HD DVD discs (the two major blue-laser DVD formats) will carry a digital watermark that will let players identify illegally copied discs and prevent playback of the content. Backers of both Blu-ray and HD DVD formats have announced their support for "mandatory managed copies," which will allow home users to make a single copy of their high-definition discs and share them across a home network--something that consumers can't legally do with today's commercial DVDs.

Vista Blurs High-Def

If microsoft has its way, your digital entertainment options will be served via a PC in your living room. To fully enjoy the benefits of digital content, however, you may have to buy new hardware.

When Windows Vista appears later this year, it will allow playback of HD video--but it may do so only if your monitor or TV supports Intel's High- bandwidth Digital Content Protection scheme. Without a DVI or HDMI port that handles HDCP, your aging 42-inch plasma set could display the film at lower DVD-quality resolution, or not play it at all (for details, see "Most Monitors Won't Play HD Video,"). The same will likely be true of Blu-ray and HD DVD recorders, though final specs of the content protection scheme for those two formats were not available at press time.

The Vista DRM scheme puts playback decisions in the hands of content providers. But showing the content at a lower resolution is more likely than shutting it off, says Marcus Matthias, a product manager in Microsoft's Digital Media Division. "Frankly, we'd have zero interest in doing all this if it wasn't something [that content owners that Microsoft partners with] were interested in having," he admits.

Although HDTVs sold today typically support digital copy protection via their HDMI ports, many older models do not. According to Rhoda Alexander, director of monitor research for market research firm iSuppli in San Jose, California, the percentage of HDCP-compatible computer monitors was "in the low single digits" when she surveyed the market in 2005.

HDCP will make it more difficult for consumers to share HD content--and will keep them from making legal "fair use" copies--by preventing the capture of HD programs by unlicensed devices. But like most DRM schemes, it's unlikely to stop determined pirates. In 2001 researchers at Carnegie Mellon University uncovered several flaws in the scheme, long before it was developed for commercial purposes. German electronics company Spatz is already selling devices that it claims convert HDCP signals for non-HDCP displays.

Olin Sibert, a longtime DRM developer, believes that Vista's DRM, while technologically impressive, is unlikely to be effective in the long run. "Content that can be experienced can also be copied. You can place obstacles in the way, but you can't ensure content will never be copied."

Playing Fair

Only the most rabid BitTorrent users would want to live in a world where copyrights don't exist, but nobody wants one side to call all the shots either.

"Hollywood is speaking with one voice, holding the reins on the one thing everyone needs: content," says EFF's von Lohman. "In that kind of environment, consumers are going to get screwed."

But Microsoft's Matthias says that it's in everyone's best interest to find solutions that media firms and users can live with. "At the end of the day, if consumers don't see a value proposition for next-generation content, there are a lot of very big companies who've made some very big bets that aren't going to pan out," he notes.

As happened with the backlash against Sony BMG's copy protection technology, users must reject bad DRM schemes--not because they violate computer security, but because they punish the people who actually paid for the digital content, say consumer advocates.

"One approach [to piracy] is to make it as hard as possible to create and share illegal copies of digital content," writes Navio's Roever in his corporate blog. "Another is to make it as attractive and easy as possible to buy digital content. The more successful the industry becomes at achieving the latter, the less it will need to rely on the former."

Digital Media Faq
Music
Work with--and around--content protection on your digital music files.

How do I know whether my CD has copy protection on it? Copy-protected CDs often come with a label identifying them as such, though that's not legally required. Amazon.com clearly identifies CDs containing copy protection schemes, so searching there for the CD title may turn up the answer.

Ack! My CD has DRM all over it. What can I do? Not a lot. Most tools for bypassing DRM are illegal under the Digital Millennium Copyright Act, though low-tech workarounds exist. Some users have circumvented Sony BMG's copy protection by placing a strip of tape on the CD's outer edge where the data layer is, to stop the PC from reading it--but if the tape comes loose, it could gum up your CD drive. Other solutions involve drawing over the outside track with a black marker or disabling the computer's autorun feature--and thereby preventing the copy protection software from loading--by holding down the <Shift> key as the CD loads.

Can't I rip MP3s without a PC? If your MP3 player offers in-line recording, you can legally rip MP3 files directly to it from your stereo, bypassing your PC. Archos, Cowon, iRiver, and Samsung all make players with this feature. Video Without Boundaries' Flyboy portable video player can do the same with DVDs. Since this method relies on analog output and doesn't break digital encryption, it doesn't run afoul of the DMCA.

Video
Beware of viewing and recording pitfalls as you navigate the digital video waters.

My DVR has "flagged" a program I recorded and will delete it in a week. Is it still possible to keep a copy? Nope. If content owners use Macrovision's copy protection to flag a program, you can't burn a copy of that show to any other storage medium. But this affects only a small number of pay-per-view and video-on-demand programs, and it applies only to TiVo subscribers--so far. Other video recorders or TV service providers may have different rules; for example, the Dish satellite network lets you record pay-per-view programs but not its Dish on Demand movies.

I'm in the market for a new high-def display. Should I wait until the DRM dust settles before I buy? Not necessarily. Virtually all new HDTVs have an HDCP-compatible digital interface, which is the one new HD players will use. More and more PC monitors do, too; look for the term "HDCP-HDMI" in the product description as you shop.
http://www.pcworld.com/news/article/0,aid,124164,00.asp





Control
Bruce

Sony and Bertelsmann were once the prides of Japan and Germany. Having grown up to become world-spanning megacorporations, they spawned a reckless delinquent named Sony BMG. As children often do, the youngster is having a hard time finding its way in the world - selling music, in particular, as well as controlling the distribution of music it manages to sell. So Sony BMG resolved to turn your computer into a battleground.

The war, of course, is the struggle to control unauthorized duplication of copyrighted material. Music fans demand to make copies, and to its credit Sony tried to meet them halfway. But en route to the meeting place, the company turned down a path that leads to a dark future.

On at least 50 titles released last year, Sony BMG included software that allows users to make up to three copies. To count the number of duplicates made, the discs install programs on the user's computer. And to keep savvy customers from monkeying with the software, the company included a rootkit, secret code that makes itself and the copy-protection files invisible.

The ability to hide files is an invitation to every hacker with, well, something to hide. Miscreants use it to cloak programs designed to take control of the host computer. Players of online games use it to conceal cheats. But there was more to Sony BMG's rootkit. The code could also send information about the user's system back to the mothership.

Blogger Mark Russinovich wrote about the Sony BMG exploit in November, and music fans exploded in righteous fury. After much denial and obfuscation, Sony BMG provided an uninstall routine. It also stopped manufacturing rootkitted titles and recalled those it had shipped. But the damage had been done. More than 2 million discs were already in consumers' hands, ready to blast holes in the system of anybody unfortunate enough to pop one into a CD drive.

I'm not going to scold Sony BMG. The problem here is larger than one company's effort to own its customers' desktops and spy on their behavior. The real issue is the blurring of lines between blackhat hacking and legitimate business. It's one thing when Russian gangsters take over a few million computers to shake down online casinos. It's another when commercial enterprises adopt the same methods to protect their market. At that point, good corporate citizenship devolves into vigilantism and the implicit trust between supplier and customer unravels.

Sony BMG isn't the only company to have mistaken malicious exploits for mainstream business practices. The British software developer First 4 Internet, which licensed the rootkit to Sony BMG, built its product on techniques developed for creating viruses, and the company's programmers left a trail of newsgroup requests for information about hacks like crippling CD drives. Ironically, First 4 Internet appropriated parts of its music player from an app known as LAME - a bald infringement of the LAME copyright.

Imagine the mayhem if this kind of attitude were to become widespread: Coca-Cola would use your desktop to propagate spam about its latest bottle-cap sweepstakes. Vonage would keep Skype offers from reaching your inbox. Samsung would make sure that, when your browser tried to load Sony.com, it reached a fake Sony site where nothing worked. Companies would compile vast archives of customer data merely because they could, hoping they'd stumble on a revenue model.

It's time for lawmakers, trade groups, and public-interest organizations to get down to the hard work of hammering out standards for what businesses can and can't do to customers' computers. Such an effort will need to be international, because the Net knows no bounds. It will need to come up with simple, understandable language for end-user licensing agreements. It will need to draw red lines around unacceptably invasive hacks and map gray areas between spying and market research.

I'm not holding my breath, though. After all, we asked for this. We didn't want to ruffle the feathers of the goose that laid the golden egg of technological progress, so we allowed manufacturers to claim more and more control over the ways we use their products and what they can do with our information. It should come as no surprise that they're using that power as a cover for bigger, possibly more lucrative schemes.

You may not be interested in the digital rights war, but that doesn't mean you'll have the luxury of sitting on the sidelines. Because the other side is very, very interested in you.
http://www.wired.com/wired/archive/1...osts.html?pg=5





SonyBMG DRM

Heise Online is reporting about yet another example of the ever-warming relationship of copy protection and rootkit technologies. The affair started with the digital rights management system Sony BMG was using to protect audio CD's. Now, we can also confirm (thanks to Rüdiger from our German office!) that at least the German DVD release of the movie "Mr. & Mrs. Smith" contains a copy protection mechanism which uses rootkit-like cloaking technology .

The Settec Alpha-DISC copy protection system used on the DVD contains user-mode rootkit-like features to hide itself. The system will hide its own process, but does not appear to hide any files or registry entries. This makes the feature a bit less dangerous, as anti-virus products will still be able to scan all files on the disk. However, as we note in our article on rootkits, it's not that uncommon for real malware to only hide their processes.

Our message to software companies producing any software (not just copy protection products) is clear. You should always avoid hiding anything from the user, especially the administrator. It rarely serves the needs of the user, and in many cases it's very easy to create a security vulnerability this way.

If you suspect you have this copy protection system installed on your computer and you wish to remove it, the manufacturer is providing an uninstaller.

A note to our local readers: we can also confirm that the Finnish release "Mr. & Mrs. Smith" does not contain this particular copy protection technology.
http://www.f-secure.com/weblog/archi....html#00000810





New DVDs Already Sparking Copy-Protection Confusion
John Borland

When the first high-definition DVDs finally hit shelves this spring, a mad scramble may ensue--not for the discs themselves, but to figure out what computers and devices are actually able to play them in their full glory.

Unraveling the mystery won't be easy. Many, if not most, of today's top-of-the-line computers and monitors won't make the cut, even if next- generation Blu-ray or HD DVD drives are installed.

That's because strict content protection technologies may automatically degrade the DVDs' picture quality, or even block them from playing at all, if the right connections and digital protections aren't in place. Even the most expensive computers sold today mostly lack those features.

Acronym soup

A glossary of DVD and content-protection terms.

Blu-ray: The high-definition video format backed by Sony.
HD DVD: The high-definition DVD format backed by Toshiba.
HDMI: High-definition multimedia interface, a digital connection technology increasingly used for computers and HDTVs. Usually associated with HDCP.
DVI: Digital visual interface, a digital connection technology often used with computer monitors.
VGA: Video graphics array, the analog connection technology widely used for computer monitors today. Does not support content protection.
HDCP: High-bandwidth Digital Content Protection, an Intel- created technology that encrypts content as it passes from the computer to the monitor.
AACS: Advanced Access Content System, a set of content protection technologies that will be used on both kinds of next- generation DVDs.
Indeed, the consumer backlash has already begun. Graphics-chip makers such as ATI and Nvidia are drawing criticism online for marketing products that are "ready" for these new copy-protection tools but that nevertheless lack critical features needed to let the discs play at top quality.

"This is a sticky issue," said Richard Doherty, an analyst with the Envisioneering Group. "It's going to be very confusing for consumers, and it's going to be very daunting" for computer makers.

The copy-protection muddle stems from Hollywood studios' desire to avoid the film piracy that was born when tools for unlocking the encryption technology on today's DVDs began spreading online in late 1999.

Along with a picture quality upgrade, the new generation of DVDs will be shipped with new digital rights management controls, with strict computerized rules attached saying exactly when and how a movie can be played.

For people who buy standalone DVD players and HDTVs, this mostly won't be a concern, as the right plugs will generally already be built in.

But computer buyers will face a far more challenging landscape. The everyday analog plug that connects most computers to monitors today doesn't support copy protection, and so is viewed as unsafe by Hollywood studios. Movies playing on a computer over this ordinary analog connection will likely be downgraded to near-DVD quality.

Even worse is the so-called DVI plug that sends high-quality digital signals to a monitor but also doesn't support copy protection.

That offers an even greater risk of copying in Hollywood's eyes. Studios have persuaded Microsoft to add a feature in the upcoming Vista operating system that can shut down that connection altogether, unless the computer has an Intel-created encryption technology called HDCP, or High-bandwidth Digital Content Protection, turned on to guard the signal all the way to the monitor screen.

Put another way--if the DVD doesn't like your plug, your monitor may go black.

A newer connection technology called HDMI almost always comes with built-in encryption. If both the computer and the monitor have this installed, everything should work as planned.

Simple question--will it work?
Today, it's extraordinarily difficult to find information that explains whether a company's products will be compatible with the new DVDs.

Part of the problem is that the copy protection technology for the discs hasn't been officially announced, even though the new DVDs are supposed to hit shelves in just three months. A cross-industry group is working on a technology called the Advanced Access Content System, slated to protect both HD DVDs and Blu-ray discs, and is expected to release its work as soon as next week.

The HDCP technology has widely been expected to be a critical part of those rules, however. In an unusual step, Microsoft told computer makers last year, as part of a preview of its new Vista operating system, that they should start using the Intel-based technology in order to be ready for the high-definition video rules.

IBM engineer Don Leake, who works with the AACS group, confirmed Wednesday that Intel's HDCP would be approved under the new rights- management rules.

But this opens up a new set of potential land mines for consumers.

In one early example, graphics-card maker ATI has marketed some of its top products as "HDCP ready" and says that its newest "All-in-Wonder X1900" card "gives effortless playback of next-generation HD DVD."

However, it doesn't mention that "ready" probably won't be good enough to make the high-definition discs play at full quality. The graphics systems actually have to have the Intel technology turned on, which has to be done by the computer maker, or by ATI itself when it sells a graphics card at retail.

Nvidia, another big graphics-chip maker, says it too has built support for HDCP into its chip designs but that it's up to the computer makers to turn it on. Almost nobody has so far, and that's drawing bitter criticism from gamers and other hardware enthusiasts online, who call the situation a "nightmare."

"We certainly are concerned over end users, and we want to make sure there is no confusion," said Godfrey Cheng, ATI's director of marketing. "But we leave it in the hands of the board vendors and (computer makers) as to whether they want to put that in."

Much of what happens when discs are finally put into computer will ultimately depend on the movie studios themselves. On each disc, it's up to them to set the rules that make all of these alphabet-soup technologies swing into action.

For example, if studios are worried that consumers might be disappointed by degraded resolutions and blacked-out monitors, they could in theory relax those rules until the approved technologies are more widespread.

Backers of the new content protection tools say they're necessary to keep the high-definition discs at the cutting edge for years to come, however.

"What we're coming out with is something that's probably going to live for 15 years or more," IBM's Leake said. "HDCP, even though not well deployed today, will be well deployed in five years. We are planning for the future."
http://news.com.com/New+DVDs+already...3-6040261.html





HBO's Harrasment of PVR Owners
Thomas Hawk

Ouch! Bitten by DRM Well last week I wrote about Dave Zatz's report that HBO wanted to have their content coded as "Copy Never" for PVR users. In response to Dave's post I tried to clarify to people that HBO's DRM request to the FCC was not about DVR usage but about VOD usage, what I felt was an important distinction.

Well no sooner than this morning we now have a screen shot up at Ed Bott's Media Central about a "Restricted Content" error that he is receiving on his Media Center PC for an HBO show that he recorded. The message reads: Restricted Content, Restrictions set by the broadcaster and/or originator of the content prohibit playback of the program on this computer.

What's worse is that according to Ed, he is receiving this message on the computer that actually recorded the programming, not a second computer that he copied the file too.

Under the best case scenario, this message is yet another example of how DRM inadvertently gets in the way of legitimate and fair use. If content providers want to use DRM it is super important that they make it as seamless for the fair use consumer as possible.

Under the worse case scenario, of course, HBO is actually no longer letting you record their content on your PVR for personal use. While I doubt this is the case, the day that HBO does this I will call them up and cancel my account -- no matter how badly I want to watch the upcoming season of the Sopranos.

Either way this looks bad for HBO who is quickly building a reputation as one of the most consumer unfriendly broadcasters out there.

Update: Ed Bott is still trying to troubleshoot why HBO will not allow him to play back recorded content on his Media Center PC. This is a big problem. If Ed Bott, who is one of the top Windows Pros out there, is having trouble figuring this out, just imagine how stuck your average Joe out there is going to be when he runs across the same thing. Ed's headline today, HBO stops working with Media Center, is kind. If these kinds of bugs continue to threaten fair use get ready for bigger headlines that say things like, Yes, in Fact, Microsoft's DRM Does Truly Suck.

It may not be fair to generalize based on Ed's experience here but he is a pro and it is troubling to see this kind of interference for a legitmate fair use of content that he has purchased. He is paying for HBO afterall and he also is paying for his Media Center PC.

I posted a comment on Ed's blog about how I recently switched my email reader from Microsoft's Outlook to Mozilla Thunderbird. I actually like Outlook more but even with the actual original Outlook disk that I had purchased myself I could not get Microsoft's buggy authentication to work. After several hours of screwing around with it I just gave up and installed Thunderbird (which I'd highly recommend by the way). This was not my first problem with Microsoft authentication and if Microsoft hopes for consumers to take a middle ground position with regards to DRM then it will need to work a lot better than it is working for Ed right now.
http://thomashawk.com/2006/02/hbos-h...vr-owners.html





How to Value Ratings With DVR Delay?
Stuart Elliott

WOULD the opening greeting on "Saturday Night Live" sound as compelling if it began "Live plus 24 hours from New York" or "Live plus seven days from New York?"

That is the multibillion-dollar question being asked on Madison Avenue as agencies and advertisers consider the implications of new data from Nielsen Media Research on television viewing in households with TiVos and other types of digital video recorders.

Late in December, Nielsen, part of VNU, started distributing its ratings information in three versions: live, the traditional way television is watched; live plus 24 hours, counting how many people who own DVR's played back shows within a day of recording them; and live plus seven days, counting playback within a week of recording.

For some prime-time series, like the hit drama "Grey's Anatomy" on ABC, the so-called live-plus ratings show slight but noticeable gains compared with the live-only viewership. But it is estimated that 50 percent to 70 percent of viewers playing back shows zip through the commercials, casting doubt on their worth to advertisers.

Nielsen's adoption of the new methodology was spurred by the growing use of digital video recorders, which are already estimated to be in 7 percent of the nation's 110.2 million TV households. DVR's are among the technologies that are starting to remake the way people watch television, along with video iPods, video-on-demand and broadband connections for personal computers.

"This is all coming at us fairly quickly," said David F. Poltrack, chief research officer at the CBS Corporation in New York and president of its new research unit, CBS Vision, "so measurement of these new devices has to come fairly quickly."

CBS and the other big broadcasters have welcomed the ability to find out how many people are using digital video recorders to shift the time they view programs. By contrast, Nielsen has been unable to provide reliable ratings data to measure the playback of programs that were taped on videocassette recorders.

"For 20-something years, the metric has been live and VCR viewing, but the DVR allows for the measurement of playback that the VCR never did," said Michael Shaw, president for sales at the ABC Television Network in New York, part of the Walt Disney Company.

Mr. Shaw cited a statistic from Nielsen about the Jan. 15 episode of "Grey's Anatomy." The episode drew a rating of 8.5 among 18-to-49-year-old viewers who watched it live, he said, which means that 8.5 percent of television households in that group saw the episode as it was broadcast. When the data was expanded to include live plus seven days, Mr. Shaw said, the rating rose to 8.7.

To be sure, that was no huge gain. But when the media landscape is fragmenting as never before, with broadcasters losing viewers to cable TV, the Internet and video games, every tenth of a ratings point — and the advertising revenue it potentially represents — matters.

"You can't fault them for selling everyone their programs reach," said Bill McOwen, executive vice president and managing director at MPG in New York, a media agency that is part of Havas.

And research, he said, "shows there is a very desirable type of person who is prone to this technology — the younger, more affluent individual" who is particularly coveted by networks and marketers.

Still, Mr. McOwen said, for many advertisers, "one has to question whether any viewing after the date intended is worth anything to them." He gave as examples the kinds of marketers that prefer to buy commercial time on Thursday nights, like retailers, automakers and movie studios, all of them seeking to stimulate demand for the coming weekend.

"If you're a film studio, how can you consider live-plus-seven viewing?" Mr. McOwen asked, adding, "The movie's being pulled from theaters by then if it had a poor opening weekend."

Several major media agencies have published reports saying that they want only live ratings to count when they sit down to negotiate with the broadcasters to buy commercial time for the coming TV season. Those negotiations, for what is known as the upfront market, are expected to begin in May for 2006-7; last spring, before the start of the 2005-6 season, the broadcasters booked about $9 billion worth of commercials in advance.

The large media agencies that disdain live-plus ratings include Carat USA, part of the Aegis Group; Magna Global USA, a unit of the Interpublic Group of Companies; and Mediaedge:cia, part of the WPP Group. That attitude, well before the upfront negotiations get under way, upset Mr. Shaw of ABC, who told the trade publication Mediaweek that he would not work with agencies that insisted on live ratings only.

"It's not our intent to negotiate in a public forum," Mr. Shaw said in an interview last week. "But to say that zero percent of playback viewing counts is unreasonable. I don't think that's a fair position.

"If you waited to watch 'Grey's Anatomy' until Monday or Tuesday, all I'm saying is that it should count," Mr. Shaw added. He was alluding to the special episode of the series on Feb. 5, which ran after the Super Bowl postgame show.

Bruce Goerlich, executive vice president and strategic research director at ZenithOptimedia USA in New York, part of the ZenithOptimedia Group unit of the Publicis Groupe, said his agency was still developing a position on live-plus ratings.

"We're looking at very small numbers right now," Mr. Goerlich said of program playback, "and growth may not accelerate the way we expected it to." The reason, he said, is that several cable system operators once strongly promoting cable box-DVR combinations to customers "are stressing video-on-demand offerings instead."

Still, "we're not dismissing the DVR," Mr. Goerlich said, because use "might increase in the future."

Jon Mandel, chairman of MediaCom in New York, owned by WPP, said the dispute "is like fighting the last war."

"There is a small group of us working on something," Mr. Mandel said, "that will make television an even stronger partner in the marketing of goods and services."

Mr. Mandel, a member of the Media Policy Committee of the American Association of Advertising Agencies, declined to be more specific.

On Friday, a spokesman for the association, Kipp Cheng, said the opening general session of its annual conference, scheduled March 2 in Orlando, Fla., would feature a discussion of the issue by Jean Pool, chairwoman of the policy committee. Ms. Pool is also executive vice president and chief operating officer at Universal McCann in New York.

As they say on TV, stay tuned.
http://www.nytimes.com/2006/02/13/bu...a/13adcol.html





Big Air and Loud Tunes: In the Halfpipe, a Techno Cavalcade
Lee Jenkins

Only a member of the United States snowboarding team has the technological capacity to flip between songs on his iPod, answer a long-distance call from his agent and order some takeout, all while floating upside down 20 feet in the air.

Any American participating in the men's halfpipe competition at the Olympics on Sunday could well be wearing a multimedia entertainment system on his back. Among the team-issued jackets is a modern marvel that includes pockets for an iPod and a cellphone. The left sleeve features a removable control module with an LCD screen. The hood has two speakers set in the lining.

If the United States riders do not become weighed down, they may even add some medals to their ensemble.

Operating the jacket is relatively simple, if you are a teenager or a professional snowboarder. The halfpipe favorite Shaun White, who is both, could be listening to AC/ DC's "Back in Black," one of the songs on his iPod, when he hears a beep for call waiting. Perhaps a representative from his clothing line is trying to reach him.

With one push of a button on the control module, the music from the speakers is muted and White is free to chat. Thanks to Audex Down and Bluetooth technology, the hood acts like a fabric phone. White never needs to be out of touch, even if he is in the middle of the most important 30 seconds of his life. Imagine the conversations he could have. Mom, hold on a sec, I've got to nail this 1080 for the gold.

To think, American snowboarders did not want uniforms, fearing they would hamper individual expression. At the Olympics four years ago, all riders were required to wear uniforms made by Nike, a company that specializes in basketball more than snowboarding. "Seeing them wearing all those swooshes — it just felt kind of wrong," said Jake Burton, founder of Burton Snowboards.

In talking with its 10 sponsored riders, Burton Snowboards learned that the athletes cared as much about what a uniform did as how it looked. Riders wanted to listen to punk, hip-hop, country and rock, without having to wear headphones. They wanted to keep in touch with their families, their representatives and their buddies, from either a chairlift or a mountaintop. They wanted to be wired, in a wireless sort of way.

"What we got was a very smart jacket," the 2002 halfpipe gold medalist Kelly Clark said.

Burton has melded two snowboarding standbys — music and technology. Ever since the Beach Boys started recording surf songs and punk bands started marketing to skateboarders, music and extreme sports have been wedded. The most popular artists, like the most popular snowboarders, are young, creative and endlessly outgoing.

Technology is required to pump up. The halfpipe star Hannah Teter travels with two iPods, one for her room and one for her runs. The halfpiper Andy Finch, equally geared up, travels with three camcorders. Danny Kass came to Italy with an Xbox 360, bought the day before his trip so he could play video games in the Olympic Village.

"I guess you could say we're pretty tech," Kass said.

While most athletes like to streamline themselves for competition, snowboarders welcome distraction. They listen to their iPods as they compete, with the lyrics urging them on. To hear riders talk about what songs boosted them to victory, what songs contributed to their falls makes it seem as if their tunes are as important as their helmets.

The selections range from Finch's favorites (punk bands AFI and Flogging Molly) to Clark's mix (the Christian music singers Shawn McDonald and David Crowder). While Kass is still mulling which song to play at the Olympics, the halfpiper Elena Hight is finally close to a decision. She considered Outkast and 50 Cent but seems to be settling on "Ooh Aah," a song by the southern hip-hop duo Grits. "It's my new favorite," Hight said.

In addition to the material on their iPods, the riders request songs for an on-site D.J. to spin during their runs. While Olympic figure skaters generally choose classical music for their routines, Olympic snowboarders pick their sound with a stylist named D J Chainsaw. Residents of Bardonecchia will have D J Chainsaw to thank Sunday morning, when they are awoken by Cypress Hill and Black Eyed Peas, blaring through 24,000-watt Panasonic speakers.

"If it were only the music, people might cover their ears," said D J Chainsaw, whose real name is Micha Ruthardt. "But in the context of snowboarding, it works."

When riders are asked why they need a D.J. playing songs if they are listening to their iPod anyway, they dismiss the question as nonsensical.

A snowboarding contest is always part fashion show. The Americans are thrilled with their off-white uniforms that have red, white and blue pinstripes. They are not as pleased that rules prohibit them from keeping stickers on the bottom of their boards. In a subtle form of protest, some riders switched numbers during practice sessions.

Even if American riders lament the lack of nightlife and organic markets in Bardonecchia, they make their own fun. They pose for pictures on a snowplow. They flash hang loose signs at cameras. They show off their jackets to competitors from other countries. Here is the button to turn on the iPod. Here is the button to answer a call.

Whether all this gadgetry improves the medal count is uncertain. But it will surely allow American snowboarders to accomplish feats never seen before. The judges have to take note of a rider who can switch from the Ramones to the Beastie Boys, balance phone calls between friends and corporate partners, and still remember to stick the landing.
http://www.nytimes.com/2006/02/12/sp...wboarding.html





Film review

Bukkake Home Companion
Jen Collins

The house I live in has three apartments; mine is on the first floor. Anyone walking down the driveway might hear me talking on the phone, singing along to 24 Country Classics, or watching TV. This Saturday afternoon I watched American Bukkake 10 (2000, Jim Powers dir.), a video I received the other day as a gift from The Reverse Invisible Cowgirl. So because I like my neighbors and my mailman and don't want them to know I watch porns by myself during the day, I turned the radio volume up.

Scene I: Trinity Maxx; This American Life on KCRW

Trinity Maxx is the first person to speak in American Bukkake 10. "Waiting is the hardest part, I tell ya," she says to the camera, as a PA tells her "5 more minutes." They chat about how porn time is different than regular time, and she explains, again to the camera, "The plot thickens." I don't know what she meant. I do know she seems to have a bit of a Boston accent, she's white and very pretty. I wonder if she went to my high school.

Cut to Trinity's solo scene. She finds herself alone in a concrete room and decides it is the perfect place to strip off her silver two-piece and masturbate. So she does for a while, and then she's on a platform doing it more, but now in front of about 30 or 40 guys sitting crosslegged on the floor. I'm going to refer to these men as jerkoffs (the site for the video is jerkoffzone.com, so don't take it the wrong way). Someone claps from off-camera and the jerkoffs stand up. Another clap and they pull down their underwear. A third clap and they hold their underwear above their heads, and a final clap brings shouts of "Bukkake!" and the flinging of the underwear at Trinity, who laughs and throws a pair of black boxers into the air gleefully. This is supposed to replicate the ancient Japanese ritual of bukkake, probably, and it happens at the beginning of every scene.

Pretty much right after the underwear gets tossed, the jerking off gets going. Trinity leans against a trashbag-covered backrest. Lots of the noises she supposedly makes are overdubbed. Her lips are closed and still she aahs; her teeth are clenched and yet she oohs. That's the soundtrack, along with some instrumental music (I keep expecting it to stop for an operator to tell me that my call will be answered in the order in which it was received), the guys' heavy breathing and grunting, plus some loud cameras. She tries to look as if she is having a sensual and enjoyable experience but I don't believe her. Though I am trying not to say things like "She couldn't possibly enjoy having three dozen strangers beat off on her head!" In therapy, I've found myself making blanket statements about how people feel, and my therapist replies with a "why not?" or a "you think?" and I realize that I'm just being judgmental and stupid, because there's no telling what a person will do for love or money given the opportunity. Trinity says thank you to the jerkoffs sometimes, and she's sort of sweet to them.

The camera zooms in on a pubic hair in a puddle of semen on her boob. Every once in a while we see how the goblet is filling up. Goblet? Yes. She holds a plastic goblet under her chin the whole time. And more aahs from Trinity as she opens the valve on the cum-bong and chugs down the semen of however-many guys got theirs in the cup. Astonishingly, she does not vomit. She gags a little though. Three more guys wank on her as she puts the cum-bong down and the camera leaves her there, oohing and aahing and mmming on the cummy trashbags on the concrete floor.

I should say that the penises in American Bukkake 10 are diverse. Meaty ones, li'l pinkies; brown, peach, olive; rapid-fire pistons and dribbly limp-ons. Some of the guys are young, some aren't, and at least one is a real old Grampy, probably. He stands in the front row and flashes a naughty smile when he throws his shorts.

As Scene 1 ends, a Hindu woman on KCRW goes on and on about Catholicism and religious icons. I have a yucky thought about Apu offering someone a cum- squishee. I pause the TV, turn off the radio, and get up to make a peanut butter and jelly sandwich. Then I remember that KCRW plays one of my favorite shows on Saturday afternoons. I used to hate Garrison Keillor when I was a kid. I had a girlfriend whose parents were total fiends about listening to him and it bothered me. I think I'm growing up. His voice is soothing and... Midwestern.
http://kittybukkake.diaryland.com/021003_5.html





Sales Brisk For "Wal-Mart" Docu As Accusations Fly
Scott Roxborough

Berlin's European Film Market became the backdrop for yet another verbal battle between Wal-Mart and its filmmaker nemesis Robert Greenwald on

Tuesday. The Greenwald-directed film "Wal-Mart: The High Cost of Low Price" made for hot sales but heated words at the market.

The verbal clash followed a similar series of jousts in the U.S. when Greenwald's film came out last year utilizing grassroots distribution, promotion via the Internet and home screenings to rack up DVD sales of more than 110,000 units. Wal-Mart countered with a campaign decrying the movie and providing access to brothers Ron and Robert Galloway to produce a countermeasure movie titled "Why Wal-Mart Works: And Why That Drives Some People Crazy."

On Tuesday, Greenwald claimed that some buyers are worried that the retail giant might retaliate against them. A Wal-Mart spokesman dismissed those claims as "preposterous."

"We have experienced some scared theatrical distributors," Greenwald insisted after a "Wal-Mart" screening here. "They are afraid that their other movies will be pulled from the (retailer's) shelves if they distribute my film."

Wal-Mart spokesman Olan James countered in an interview: "To say that we'd retaliate against a distributor for carrying this film is simply preposterous. We've chosen not to carry either film in our stores -- the (Galloways') pro-Wal-Mart documentary or this anti-Wal-Mart film. But we're confident that the public will be able to spot the glaring inaccuracies throughout the (latter) film."

He was referring to the situation that arose in the U.S. last year with the release of "Why Wal-Mart Works." Lightning Entertainment's Richard Guardian said initially eager buyers from Brazil, Japan and Mexico, where Wal-Mart is a growing retail force, said they were worried that buying the film could have negative commercial repercussions for their DVD distribution business.

According to its own figures, Wal-Mart operates about 2,400 stores outside the U.S. In some territories, the retailer is a major player. In the U.K., for example, Wal-Mart is the second- largest retailer with its chain of ASDA-brand stores.

Lightning Entertainment said it has inked deals at the European Film Market for Germany, the U.K. and Australia/New Zealand. Guardian said he expects to close on Spain, Benelux and France this week and that several European pubcasters also are circling.

"The response here at the Berlinale has been unbelievable," Guardian said. "The film addresses global issues, and people are fascinated with the U.S. society and culture."

The docu's claims of runaway capitalism make it a natural for many European territories. Wal-Mart stories have been front-page news in such places as Germany, France and the U.K.
http://today.reuters.com/news/newsAr...IN-WALMART.xml





Giving gamers two windows to the Web: The Opera Browser for Nintendo DS™
Press Release

Opera Software today announced that it will deliver the World Wide Web to Nintendo DS users in Japan.

In Opera's agreement with Nintendo, Nintendo DS users will now be able to surf the full Internet from their systems using the Opera browser. The Opera browser for Nintendo DS will be sold as a DS card. Users simply insert the card into the Wi- Fi enabled Nintendo DS, connect to a network, and begin browsing on two screens.

Earlier this year, Nintendo reported that 13 million Nintendo DS systems were sold to consumers around the world within just 13 months of its debut in November 2004. Nintendo DS combines unique dual screens, touch screen, voice recognition and wireless and Wi-Fi communications capabilities. According to an independent market research company in Japan, Nintendo DS has become the fastest selling video games machine to top the six million sales mark in Japan in just over 14 months since its Japanese debut, breaking the old record held by Nintendo's Game Boy Advance.

"The incredibly popular Nintendo DS is already Wi-Fi enabled to support real time gaming, so adding Web browsing capabilities was a natural evolution for this device," says Scott Hedrick, Executive Vice President, Opera Software. "Gaming devices are growing more advanced and a great Web experience is becoming a product differentiator for gaming manufacturers. Opera is excited to work with Nintendo to deliver a unique dual screen, full Internet experience on Nintendo DS."

With an on-screen keypad and stylus, users can easily navigate the Web from their Nintendo DS with PDA-like functionality. Based on the same core as the Opera desktop browser, Opera delivers superior speed and rendering of Web pages on the Nintendo DS.

"Within just five seconds of turning on the system, the Nintendo DS is already fully operational. This makes it the ideal device to enable people to swiftly obtain the latest information from the internet, wherever they are," says Masaru Shimomura, Deputy General Manager of Nintendo's R & D Department. "Opera exceeded our expectations with its user friendly interface, quick access to all your favorite sites, ease of use and, most importantly, in making the best use of the Nintendo DS system's unique double screens and touch screen features. Opera is an important partner for Nintendo in our efforts to further expand the users of the Nintendo DS."

Nintendo Co., Ltd. held a presentation today in Tokyo, Japan, to announce updates for the Nintendo DS. Information on the availability of the Opera browser DS card has not yet been announced.
http://www.opera.com/pressreleases/en/2006/02/15/





Intel Ups Ante With 4-Core Chip

New microprocessor, due this year, will be faster, use less electricity
Matthew Yi

In an effort to regain market share that its smaller rival Advanced Micro Devices has aggressively taken in the past year, Intel Corp.'s chief technology officer
said Friday that the chip giant will start shipping microprocessors with four cores inside late this year.

To show the product is well on its way, Intel CTO Justin Rattner demonstrated a working server computer with a pair of the new microprocessors, code-named Clovertown.

The new chip will join Intel's line of server chips called Xeon, which has generated billions of dollars' worth of revenue for the Santa Clara company. That business, though, has been under pressure since Sunnyvale's AMD entered the segment with its microprocessor called the Opteron.

Chips with two cores have been the latest rage, with both Intel and AMD selling those microprocessors as their high-end offering. Apple Computer Inc.'s new iMac, which started selling last month, uses the dual-core chip.

Having multiple cores inside a chip is like having more than one engine under the hood of a car. The design allows chipmakers to keep improving performance of the microprocessor while holding in check the amount of electricity required to power it.

Not to be outdone, Randy Allen, AMD's corporate vice president of server and workstation division, said Friday that his firm is working its own quad-core processor for release next year.

Rattner said Intel's new chip will be faster than the Xeon server chips but use less electricity. He didn't elaborate on the new chip, saying those specifics will be made available at the chipmaker's developer forum in San Francisco next month.

Intel still commands the lion's share of the lower-end server computer market. AMD, it only major competitor, has been making strides with its Opteron microprocessors since they came out in April 2003.

According to data from Mercury Research, AMD's Opteron had 16.4 percent of the market in the most recent quarter. Intel's Xeon product line still leads by a wide margin.

AMD's gains are significant, considering its market share was virtually none only a year ago, said Martin Reynolds, an analyst at Gartner, a market research firm.

"Intel doesn't normally talk about this stuff, much less show it, this early," Reynolds said. "But with AMD's (rise) in the market, they want to make sure they don't leave any gaps for AMD to exploit. It's important from a credibility standpoint."

Apjit Walia, an analyst at RBC Capital Markets, agreed, noting that AMD is enjoying at least the perception that its products are better than Intel's chips.
http://sfgate.com/cgi-bin/article.cg...UGCOH6P2B1.DTL





Intel's Mantra: Let's Make A Deal
Tom Krazit

Would you avoid buying a PC with an Advanced Micro Devices chip inside because it wouldn't let you host an Internet conference call with six of your friends?

Chip giant Intel is betting that at least some people would. Last week, Intel cut a deal with voice over Internet Protocol provider Skype that calls for the VoIP company to provide advanced conference-calling features exclusively on PCs that run Intel chips. As long as the deal is in place, it could effectively keep customers who want to take advantage of multiperson conference calls from going with AMD-based machines.

Though few would argue that a niche feature like that is going to be a deal breaker for most PC buyers, the importance of the Skype-Intel alliance goes well beyond VoIP conferencing. Indeed, it's the latest, and certainly most prominent, example of Intel's new take on marketing: Lock in software partners as well as the PC makers.

Intel executives have talked at length over the past few years about moving past a marketing strategy that emphasizes chip speeds and power above all else. Paul Otellini, now Intel's chief executive, got the new effort rolling in 1999 when, as executive vice president and general manager of the Intel Architecture Group, he created operating groups that focused on developing software and finding new uses for Intel's products, said Bill Kircos, an Intel spokesman.

Expect more of these exclusive pacts as Intel takes a brass-knuckles approach to its long-running feud with AMD, particularly as Intel's Viiv platform strategy of bundling home-entertainment software with its chips shifts into high gear over the next few months.

Intel executives believe they can use their considerable software resources to improve the performance of processing-intensive applications such as VoIP and home entertainment by working with software application developers to help them understand how Intel's chips process data.

In the process, moves like the Skype deal, which will run for a limited but undisclosed period of time, are a way to block AMD from landing customers who want to use applications such as Skype's 10-user conferencing.

Not surprisingly, AMD is already crying foul. AMD officials claim this is just another example of Intel using its sheer size to decide where AMD is allowed to compete, reinforcing the notion that Intel doesn't play fair. AMD charged in a 2005 antitrust compliant that Intel uses its marketing programs in a selective manner to punish companies who have used AMD's chips, or to reward companies like Dell who have cut exclusive deals with Intel--claims Intel has strongly denied.

Performance in the eye of the beholder
In the past, Intel has set its products apart and improved the performance of applications such as games by adding new hardware instructions to its chips, said Kevin Krewell, editor in chief of The Microprocessor Report.

But there are no specific instructions in Intel's current Pentium D or Core Duo chips that enhance the performance of VoIP applications, an Intel representative said. Skype is using an operation called "Get CPU ID" to identify the type of processor running on the PC. The Skype software has been preset to only accept Intel's chips as having the performance necessary to host conference calls of more than five people, the representative said.

Almost all applications running on any PC perform the Get CPU ID operation as the system boots, said Dean McCarron, principal analyst with Mercury Research. That operation determines what type of processor is in the system and what performance features are available to the application, he said.

Critics contend that if there are no instructions dedicated to VoIP applications in Intel's chips, it's unlikely that Intel's dual-core chips are demonstrably more powerful than AMD's when it comes to hosting VoIP conference calls. In fact, third-party reviewers gave AMD dual-core chips an edge over Intel's last year, though Intel has closed the gap with the recent introduction of the Core Duo processor.

Henry Gomez, general manager of Skype North America, declined to comment on whether the company compared the performance of the two chips head-to-head on its software. A Skype representative later declined to comment on the company's relationship with AMD in general.

By the end of 2006, Intel is scheduled to release two PC chips, Merom and Conroe, that the company believes will tilt the performance balance back in its favor, Kircos said. For its part, AMD won't sit still in 2006; it's also planning to improve the performance of its chips. If there's no clear-cut winner on a performance basis, the product marketing strategy shifts to specific applications and content.

Viiv sets the stage
Viiv is a collection of dual-core processors, multimedia chipsets and software designed to enhance the performance of games, streaming movies and other home entertainment applications. Viiv PCs are rolling out from PC makers this year accompanied by links to special content, such as high-definition highlights of NBC's Olympics coverage, a lure announced by Intel earlier this year at the Consumer Electronics Show in Las Vegas.

That content is currently available to just about any PC, but Intel is extending the verification concept it advanced with the Centrino platform to Viiv. Intel verified that more than 90,000 hot spots worldwide would work reliably with Centrino laptops. It plans to do the same with Viiv, guaranteeing that certain content and home entertainment applications will run smoothly on Viiv PCs.

Given the Skype example, analysts say it wouldn't be a stretch for Intel to take the further step of using its marketing clout to secure exclusive content and software that will work only on Viiv PCs.

A similar strategy has worked very well for new Intel partner DirecTV, which has the exclusive rights to let football fans watch every National Football League game, under its NFL Sunday Ticket service. Any football fan with a television set can watch NFL games featuring their local teams, but those viewers can't watch games that feature cities outside of their designated geographic region unless they have a DirecTV satellite dish and pay extra for the Sunday Ticket. Intel and DirecTV plan to release a Viiv PC later this year that can accept content from DirecTV's satellites.

Savvy marketing or unfair competition?
AMD executives argue that any exclusivity clauses in Intel's partnerships are nothing more than an extension of its so-called market development funds, which provide PC makers with marketing money in exchange for displaying an Intel logo on their boxes, said Hal Speed, a marketing architect with AMD.

Intel's Kircos declined to comment on whether Skype was provided with marketing funds in exchange for making the multiperson conference calling feature exclusive to Intel under a similar program. But Intel's engineers did do the work needed to tweak Skype's software to accept Intel's chips as the default processor for those types of conference calls, he said.

Intel and Skype's deal is for a limited time only, Gomez said, after which AMD is expected to get a crack at opening up its chips to the advanced conference calling feature. But by moving first, Intel has seized the opportunity to paint itself as the preferred platform for Skype, much the same way gaming console makers fight to secure the initial release of sought-after games or cell phone providers pursue hot new phones.

"Grand Theft Auto: Vice City" was released in the U.S. on Sony's PlayStation 2 console in 2002 before making its way to the PC and Microsoft's Xbox in 2003. That limited exclusivity for one of the hottest video games ever released was a boon for PlayStation 2 sales, and Sony currently enjoys a dominant position in the console market, even though the Xbox and a standard PC are considered more powerful devices.

The same could soon be true for the PC market, which has always been about performance even as Intel has retreated from its strategy of emphasizing clock speed as the ultimate indicator of processing power. "If the technology is close enough that it becomes a wash in the consumer's mind, it could be the content that makes the buying decision clearer," Krewell said.
http://news.com.com/Intels+mantra+Le...3-6038282.html





A Wild Ride: The Digital Music Industry
Bryan Borzykowski

What happens when major players in an industry start suing their customers?

The advent of MP3 files, file-sharing technology and digital gadgetry such as the iPod means music lovers have more freedom to share music than ever before. But there's no consensus among industry executives on how to cash in on this brave new world.

For more than two years, the Recording Industry Association of America has brought suits against illegal file sharers, reasoning that downloading music for free is stealing. Legal digital sales are booming--the digital music industry had revenues of US$1.1 billion in 2005, up from US$380 million the year before. But the RIAA continues its strategy.

Last August, the RIAA targeted David Greubel, a Texas man accused of having 600 illegal songs on his computer. His daughter sent a protest e-mail to MC Lars, the rapper who wrote "Download This Song." The e- mail reached Terry McBride, CEO of Vancouver-based Nettwerk Music Group (who represents Lars). McBride is helping Greubel fight the suit.

"Litigating your fans, who are your best marketing and promotion people, is not the answer," says McBride. While most major label executives are staying quiet, he says they agree with his position.

Not Rob Brooks, vice-president of marketing for Toronto-based EMI. "Many countries have launched litigation," says Brooks. "In all cases, legal purchases increased once litigation started. If, following litigation, legal sales increased, that's the answer."

Increasing sales is important for an industry that's lost a lot of money in recent years. But, Nettwerk's McBride says, this decrease isn't a result of illegal file-sharing. He thinks it's to do with competition from other entertainment media, and the replacement cycle--CDs don't wear out. If anything, he says, digital downloading, which made Nettwerk more than US$300,000 last December, has started to offset losses.

McBride isn't the only industry exec to acknowledge that "digital is the future." According to Janis Nixon, senior marketing manager for Universal Music Canada's New Media department, "[Digital] is completely open to new possibilities." The industry was criticized for not reacting; Nixon says that's because labels "didn't have a partner we could sell legally through."

Now, the industry has hundreds of partners. There are more than 335 legal download sites--up 570% from two years ago. In Canada, consumers can choose between pay-per-download sites such as iTunes and Puretracks, or subscription/pay-per-download sites like Napster and iMesh, which use industry-sanctioned peer-to-peer file-sharing. Telecommunications companies such as Rogers and Bell also want to cash in. "You're going to see more convergence between music and wireless," says John Boynton, Rogers Wireless's senior vice-president and chief marketing officer. "A significant portion of new customers buy MP3 phones."

In Asia, the mobile-phone-related music market has exploded--cellphone downloads accounted for 96% of Japan's digital music revenues in the first nine months of 2005, and last May, SK Telecom, South Korea's largest cellphone operator, bought a controlling stake in a leading independent Korean record label. And in a report released January 2006, the International Federation of the Phonographic Industry, a global industry association, points out that, with more than 1.5 billion cellphone subscribers worldwide, "the sheer size of the mobile market presents the music industry with enormous opportunities." That, says Nettwerk's McBride, is music to his ears.
http://www.canadianbusiness.com/tech...13_74308_74308
















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- js.


















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Old 16-02-06, 05:54 PM   #3
TankGirl
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Quote:
Deputy Prosecutor General, Vladimir Kolesnikov:

“Establishing legal websites could help decrease piracy on the web,” he said.
That makes perfect sense. I am personally convinced that by legalizing p2p we could eliminate piracy almost entirely from the Internet...

Thanks for the WiR, Jack!

- tg
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