Peer-To-Peer News - The Week In Review - June 2nd, '12

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June 2nd, 2012




All Along The File-Sharing Front: Will New York Affect The Rest of America?
Victoria Bekiempis

Good news, New York file sharers!

Verizon has apparently decided to protect your privacy, despite demands that the internet service provider ID subscribers suspected of copyright infringement.

And the company's decision -- as well as other recent developments intellectual property realm -- might have broad implications.

So what's up?

Not too long ago, John Wiley and Sons, which publishes the "For Dummies" book series, asked Verizon to cooperate in a mass BitTorrent lawsuit -- the kind with countless John Doe defendants known only by their IP address, according to TorrentFreak. More than 250,000 of these suits have been filed since 2010.

Verizon refused, claiming that the IP address doesn't actually provide evidence of wrongdoing, as "the person who pays for the account might not be the infringer."

The corporation also felt that "information that is protected from disclosure by third parties' rights of privacy and protections guaranteed by the First Amendment" and that the publisher wanted the info "for improper purposes, namely 'to harass, cause unnecessary delay, or needlessly increase the cost of litigation.'"

The publishing company then pushed a court to compel Verizon to release the info via subpoena. The telecom concern still didn't agree. Wiley wanted the court to compel Verizon, but dropped that demand after talking with the company's counsel -- eventually withdrawing its subpoena altogether.

The significance of all this? For starters, this is one of the few times that a company has successfully stuck up for its users' rights and demonstrated that compromise can be reached in cases of alleged piracy.

Verizon has also agreed to implement a music and movie industry-backed "six strikes rule," in which suspected infringers are given six warnings before their internet connections are slowed or cut off.

The company's non-punitive approach will likely be a litmus test for future policymaking, since it has argued that "strikes" will curb copyright piracy more than civil judgments.

It's worth noting that when it comes to this kind of stuff, what happens in New York doesn't appear to stay in New York.

Shortly before the Verizon decision, a New York judge slammed the IP addresses-ID connection, saying: "the person listed as an account holder is often not the person who downloaded the copyrighted material...it is no more likely that the subscriber to an IP address carried out a particular computer function -- here the purported illegal downloading of a single pornographic film -- than to say an individual who pays the telephone bill made a specific telephone call." That view was then echoed in a California court, in which a judge decided that IP addresses can't even ID a state.
http://blogs.villagevoice.com/runnin...le_sharing.php





1,400 BitTorrent Users Sued in May
Thomas Mennecke

The epic story of file-sharing lawsuits has been a remarkable tale of jamming a square peg in the round hole of US civil procedure law. One of the ongoing debates is whether rounding up dozens of IP addresses and filing lawsuits against that lot is fair - initially, all of the lawsuits were filed in federal district court in the District of Columbia. File-sharing litigators have abandoned that practice and have sprinkled their lawsuits throughout the federal judicial system. The old practice was patently unfair, as it could force someone in Washington State to defend themselves in Washington DC.

File-sharing litigators have to satisfy a few things in order to bring a copyright claim in federal court, one is personal jurisdiction. This allows the court to exercise coercive power over a defendant. How can a court do this in the context of file-sharing litigation? Let's take a look at two of the complaints filed this month. Here's one from Media Products, Inc., claiming the rights to "OMG! I Fucked My Daughter's BFF! 2" was violated under federal copyright law:

"On information and belief, personal jurisdiction in this District is proper because each Defendant, without consent or permission of Plaintiff as the exclusive rights owner, intentionally and willfully distributed, and offered to distribute over the Internet, copyrighted works for which Plaintiff has exclusive rights. In addition, each Defendant contracted with an Internet Service Provider (ISP) found in this District to provide each Defendant with access to the Internet. Therefore, venue in this Court is proper in accordance with 28 U.S.C. § 1400(a)."

In essence, their complaint spells out a copyright complaint falling under this particular law, and therefore the court should exercise jurisdiction over these Does. This seems like a rather straightforward, plain language law: if the defendant violates your copyright in New York, you can file your claim in New York. Sounds plausible, but we're just not sure if their complaint actually spells that out or not.

Now check out how Malibu Media establishes personal jurisdiction for the alleged sharing of their film "Lunchtime Fantasy":

"As set forth on Exhibit A, each of the Defendants’ acts of copyright infringement occurred using an Internet Protocol address (“IP address”) traced to a physical address located within this District, and therefore this Court has personal jurisdiction over each Defendant because each Defendant committed the tortious conduct alleged in this Complaint in the District of Columbia, and (a) each Defendant resides in the District of Columbia, and/or (b) each Defendant has engaged in continuous and systematic business activity, or has contracted anywhere to supply goods or services in the District of Columbia."

Ok...so basically they're saying, based on the IP address evidence, that either the person lives in the geographical boundaries of the court's jurisdiction, but, if not, their "continuous and systematic business activity" works as well. We may think of file-sharing as a lot of things, perhaps bandwidth clogging, perhaps flame-war inducing, but when was the last time anyone hopped on BitTorrent, downloaded some smut, and considered it a business transaction?

Out of the two, the first approach on establishing personal jurisdiction seems much more straightforward. The second approach by Malibu is trying too hard to analogize a business related concept to personal copyright infringement. Perhaps both approaches are spot on, but they also seem vulnerable to attack.
http://www.slyck.com/story2222_1400_...rs_Sued_in_May





Sky Blocks Access to The Pirate Bay File-Sharing Site
BBC

Sky Broadband has begun blocking access to file-sharing site The Pirate Bay.

It follows Virgin Media and Everything Everywhere which have already taken similar action.

The High Court had demanded the move after complaints by the British Phonographic Industry (BPI) that TPB facilitated copyright infringement by providing magnetic links to movies, music and other media.

O2 and Talktalk said they were still working to implement the ban.

A sixth operator, BT, has been given extra time to make the necessary arrangements. It is expected to act within the next fortnight.

Deadlines

A statement from Sky said: "We have invested billions of pounds in high-quality entertainment for our customers because we know how much our customers value it. It's therefore important that companies like ours do what they can, alongside the government and the rest of the media and technology industries, to help protect their copyright."

A spokesman noted that it had acted ahead of a 1 June deadline.

This is the second court order of its kind that Sky has complied with following its block on Newzbin 2 in December.

The High Court issued different time limits to the different ISPs.

O2 has until 13 June to act, by which time it said it would block access to TPB's main site as well as other IP addresses that the BPI successfully claimed had been set up to enable access to the service.

However, the Torrentfreak news site has reported that TPB has since set up a new IP address giving access to its contents. It added the site was willing to play "an extended game of whack-a-mole" in which it would publicise new locations every time the courts ordered one of its addresses to be blocked.

A spokesman for the BPI said it was working with ISPs and the courts to ensure that existing orders were effective, but would not comment on whether it would seek to block further addresses.

Pornography

Meanwhile, O2 is set to return to the High Court on Thursday for a hearing into a separate copyright complaint.

A judge will hear evidence in a dispute with Golden Eye International, a limited company which trades as Ben Dover Productions making pornographic films.

In March the firm won an order demanding O2 release details of thousands of its customers whose IP addresses it said had been linked to illegal downloads of Ben Dover's films.

At the time O2 said it had no option but to "co-operate fully".

The hearing is for the court to "approve the form of a letter" that Golden Eye wishes to send to its customers.

"In our first letter we seek to find out more information regarding evidence of an infringement of our copyright," Julian Becker, director of Golden Eye told the BBC.

"Depending on the response to our letters we will then decide our next action.

"Fundamentally we are pursuing those that are uploading not downloading. In effect these violations are unauthorised distribution, we are not pursuing those who have simply downloaded one film."

Mr Becker added that he was awaiting guidance from the court as to how much compensation his firm could seek.

Golden Eye previously said it wanted £700 for each infringement - a sum watchdog Consumer Focus described as "unsupportable".
http://www.bbc.com/news/technology-18270343





Report: Some Microsoft Employees Enjoy Illicit File-Sharing

Whatever side of the issue you are on, it is never a good thing when a company that is seen as a major rights holder rails against piracy and file-sharing and then gets called out for ... piracy and file-sharing. Using the site YouHaveDownloaded.com, TorrentFreak has once again caught the employees of a major corporation engaging in the very thing that it publicly rails against and pays millions of dollars to fight. The company in question is Microsoft, whose employees were found to be downloading everything from porn movies and blockbuster Hollywood films to motivational eBooks.

Examples of items popular with Microsoft employees included the films "The Debt," "Bordertown," and "Blind"; the adult film "Rocco’s Psycho Love"; and eBooks such as "100 Great Painters" and "Cross-Train Your Brain: A Mental Fitness Program for Maximizing Creativity and Achieving Success."

Of course, past investigations using the site's collected data revealed similar chicanery at a number of other organizations and governments including the palace of the French President, the Church of God, the RIAA and the US House of Representatives...
http://www.gamepolitics.com/2012/05/...t-file-sharing





French Court Backs Google in TV Piracy Case

A French court ruled that Google is not responsible for filtering content on YouTube, dealing a blow to French broadcaster TF1 which sought damages for copyrighted sports and movies which ended up on the video-sharing website.

TF1 claimed 141 million euros in damages but was ordered to pay 80,000 euros of Google's legal fees.

The decision mirrors an earlier case in France in 2011 in which video-sharing website Dailymotion was classified as a 'platform' for content and not an 'editor' of content.

The two French decisions mean that the websites are not legally responsible for ensuring that pirated content does not appear, as long as they take steps to remove it once the copyright owner indicates its presence.

Google faces other cases in the United States involving media giant Viacom and in Italy involving broadcaster Mediaset over whether its YouTube site is responsible for pirated content.

A German court ruled in April that YouTube was responsible for the content its users published and should take down copyrighted clips or face a hefty royalties bill.

In April a U.S. appeals court also dealt Google a blow by reviving lawsuits by Viacom Inc, the English Premier League and other media companies over the use of copyrighted videos on YouTube.

In France the courts have sided with Google.

"The defendant is not responsible in principle for the video content on its site; only the users of the site are," the decision reads.

"It has no obligation to police the content before it is put online as long as it informs users that posting television shows, music videos, concerts or advertisements without prior consent of the owner is not allowed."

The case can still be appealed because it was made by a civil court of first instance in Paris.

A spokeswoman for TF1, which is France's biggest broadcaster, said it saw the decision as "surprising in several respects."

"For that reason, TF1 is studying whether to appeal the decision," she added.

Google welcomed the decision, saying it was good for the company and for Internet users.

Christophe Mueller, head of partnerships for YouTube in Southern Europe, Middle East and Africa, welcomed the decision as allowing the site to continue as an "open platform for everyone."

"We continue to oppose any demands to systematically filter or pre-screen YouTube content and are confident that future court rulings will uphold the need to allow innovative Web services to flourish," Mueller said in a statement.

Google shares were up 0.9 percent to $596.75 per share at 1443GMT.

(Reporting by Leila Abboud and Gwenaelle Barzic; Editing by David Cowell)
http://www.reuters.com/article/2012/...84S0X720120529





Ari Emanuel, This is Where I Work
Joshua Topolsky

At this week's All Things D conference — D10, which marked a decade of these retreats — Walt Mossberg and Kara Swisher were gracious enough to invite Hollywood agent Ari Emanuel on stage to talk about the changing entertainment market as it relates to technology. Ari is an incredibly powerful player in film, TV, and increasingly even web content — he's the kind of guy who can say things like "you'll never work in this town again" and actually make it happen.

Now you probably haven't seen much of the real Ari, but you're likely familiar with the character of Ari Gold (played by Jeremy Piven) from HBO's bro-fest, Entourage. That Ari is a raging, expletive-spewing egomaniac whom I always thought was a broad exaggeration of the real thing. On Wednesday night, I learned that was not the case.

As you can see in the video below, when the time came for the Q&A session with Ari, I got up and asked a question that he didn't seem to like very much (my question starts at about 16:53, but you should watch the whole thing). The gist of my question was simple: does he think that in order to fight piracy, it's AT&T, Verizon, and Google's responsibility to create a roadblock to that content? Instead of answering or addressing the complication of the issue, he resorted to what amounts to an ad hominem attack.

Here's the thing: he didn't like the question because he didn't understand the analogy I was making. And he didn't understand the analogy, because he doesn't (or doesn't want to) understand the basic mechanics of how both copyright law and the internet work.

And that should scare the shit out of you. With the stakes as high as they are — and I do mean stakes as high as whether or not we'll continue to have a free and open internet — not understanding is the most dangerous thing you can do right now. Ari is not some small time guy — he's a titan who not only backed SOPA, but essentially admitted on stage that Hollywood paid for the bill through "fund raisers" for politicians. His brother is Rahm Emanuel, current mayor of Chicago, and former White House Chief of Staff to President Obama. If there's anyone in Hollywood with pull that can go beyond the sun-kissed shores of LA, it's Ari Emanuel.

This isn't the last you've seen of him — it's the first.

I want to break down what I was getting at in my question and explain it, so maybe the next time Ari and I talk, he won't be able to scream his way out of the conversation. Oh, who am I kidding? He's going to scream anyhow.

Funnily, my argument can be best illustrated by addressing the red herring Ari used that suggests child pornography and copyrighted works are somehow the same thing. They are in no material way the same thing, save for the fact that they both happen to be things that exist.

Identification and understanding of child pornography is a rather basic affair. Despite some fringe cases where an argument can be made that the work is art and not pornography, there is very little to consider when you find yourself looking at the thing. When writing about Emanuel's interview, TechDirt's Mike Masnick said it succinctly:

There is no "legal" child porn. There is no "authorized" child porn. There is no "fair use" child porn. There is no condition under which that content is legal and there are no legal questions to be answered in filtering it. Copyright is entirely different. You can't just "know" if the content is infringing. As we saw in the Viacom case, companies upload authorized stuff all the time, and it's often impossible to distinguish from unauthorized content. Separately, you can't create an algorithm that detects fair use. Or the public domain. Point being: it's not that easy and it's silly to claim otherwise.

But, here's the real kicker: no one is really blocking access to child porn. Google filters out child porn results from its auto-complete in search, but those pages can still be found. And even if Google were to block the pages, there are hundreds of search engines that won't. Child porn is still all over the internet. No magic switch has been flipped.

Even though Ari's point about child pornography isn't valid, I still agree with him that both child porn and stealing are wrong, and we should try and stop them. The problem with Ari is that he doesn't know how to stop stealing when it comes to copyrighted works, and neither does the tech industry. He's just really mad and wants the problem to be fixed —and because he's a blustery guy with money on the line, he's not really worried if we do in fact rip up the roads that lead to his house.

But I am, and you should be, because this is a job that requires a scalpel, not an axe.

The next day, Google's Sundar Pichai and Susan Wojcicki took to the stage, and Mossberg put the question to them: could they stop pirating if they wanted to? "I think he was misinformed. Very misinformed." Susan said.

Remember, there's probably no one in the world more knowledgable about how people find pirated material on the internet than these two.

"We have done as much as we possibly can, we do not want to be building a business based on piracy, we want to work with content owners. The problem is that identifying which copyright belongs to who is very complicated. It's not like child porn, when I see a piece of content, I don't know if you own the copyright."

She added, "If we're given something, we can solve all the technical parts, but at the end of the day we need to hear from the content owner. There's no formula, there's no algorithm."

What Ari seems to forget, and what maybe politicians and the film and TV industry seem to forget is the last time piracy was a flashpoint between the entertainment and tech industries, the problem was not solved by sledgehammer legislation. Or takedowns. Or yelling. It was solved by the music industry accepting that their old model was broken, and technologists figuring out a new way to do business. And that gets to the core of this problem for Ari. We didn't go back to the way things were after the RIAA sued college students — the industry changed.

He doesn't want to change his business model, and he will do anything he can to protect it — including altering the basic functionality of the internet. Pirating and Apple's resulting rise in the music business changed that business forever... and diminished its financial footprint. Entrenched companies that owned every part of the food chain suddenly discovered they were just another cog in a big wheel.

Ari doesn't want that anymore than the music industry wanted it, or traditional media wanted it. Ned Ludd and his machine wreckers didn't like change either.

But there is one simple truth that I really believe in, in life or in business: adapt or die.

You want to know where I work Ari? I work on the internet. Welcome aboard.
http://www.theverge.com/2012/6/1/305...s-where-i-work





Hollywood Super Agent Ari Emanuel Mystified That Google Doesn't Just Invent A Magic Stop Piracy Button
Mike Masnick

Famed Hollywood super agent Ari Emanuel (the model for Jeremy Piven's character in Entourage, and the brother of Chicago mayor/former Obama chief of staff Rahm Emanuel) doesn't have a particularly good history when it comes to his understanding of how technology and policy will develop. Two years ago, he insisted that he was talking to President Obama about getting a three strikes law in place in the US. Last year, of course, he was excited about new laws like SOPA/PIPA. That was at the AllThingsD conference, in which he chided a reporter at one point by saying that the reporter needs a history lesson and "the business of the movie business is DVDs."

This year, at the very same conference, he's changed his tune, but not his attitude or ignorance of technology. This year, he told the crowd that "the DVD business is gone" and everything was about TV, TV, TV. Except, once again, he appears to be ignorant or (more likely) in complete denial:

Emanuel: Cord-cutting's not happening.

Walt: But cord-never is happening.

Emanuel: I don’t think so. I think when people get to a certain age, they pay. Somebody’s got to pay for this, or you’re not going to get premium content, and I think that’s more valuable than "two dogs doing whatever they’re doing on a couch."

Some of this appears to be just plain old wishful thinking and some of it is ignorance. The actual numbers show that cord cutting is very, very real. Also, I'm getting pretty sick of the condescending ridiculousness where people insist that either we stick with the old model or all we have left are amateur animal videos (usually cat videos, but Ari went to the dogs). That's not just elitist. It's wrong. There's plenty of quality content that get produced outside of the traditional model, and the amount is growing. And, of course, the "somebody's got to pay for this" argument is a complete tangent. First of all, no, no one has to pay for anything, but more importantly, there are all sorts of interesting business models developing that don't require people paying for a jacked up cable subscription. Second, just because you want someone "to pay" for the content which pays your hefty salary, that has absolutely nothing to do with the reality of cord cutting. It's like the CEO of a horse buggy manufacturer insisting that no one's buying automobiles because "someone's got to pay" for all those horse buggies.

A little tidbit from history: it was the guy who left the horse & buggy business and went on to found both GM and Chevrolet (despite being fearful of those "dangerous" machines) who ended up being successful. Not the guys who clung to selling horse and buggies.

Emanuel pays some lip service to technology innovation (he even seems to like the idea of crowdfunding), and talks about how involved he is in digital projects. But he still comes at it from the perspective of "how can these new technologies protect my old way of doing business?" And there, apparently, every problem is Google's fault, because they haven't created the magic "stop piracy" button. He repeatedly mentioned Google, and how they had to "stop helping people steal my clients' content." When asked how, he admitted he has no idea. When asked if he wants them to censor search results, he responded:

I don’t want them to censor results, but they have a bunch of smart guys there that can figure this stuff out.

You see? Magic "stop piracy" button.

Josh Topolsky, from The Verge, apparently challenged him on this point, asking: "Aren’t you saying that the road is responsible for the fact that someone drove on it before they robbed my house?" Emanuel didn't like this analogy:

That’s a stupid example. Look, Google can filter and does filter for child pornography. They do that already. So stealing is a bad thing, and child pornography is a bad thing.

Of course, this once again displays his ignorance. Child porn is easily identifiable by anyone who sees it. There is no "legal" child porn. There is no "authorized" child porn. There is no "fair use" child porn. There is no condition under which that content is legal and there are no legal questions to be answered in filtering it. Copyright is entirely different. You can't just "know" if the content is infringing. As we saw in the Viacom case, companies upload authorized stuff all the time, and it's often impossible to distinguish from unauthorized content. Separately, you can't create an algorithm that detects fair use. Or the public domain. Point being: it's not that easy and it's silly to claim otherwise.

Emanuel, like many people, also seems to have a blindness for how the situation he's in is no different than the situation others have faced. He talks about how the music industry should have embraced Napster when it came along -- but when he's asked about embracing similar platforms for TV, he immediately says that's ridiculous, because "these things cost lots of money." Again, we're in "wishful thinking" land, where because the producers of content do little to keep down costs, old and obsolete business models must stay in place, and new and innovative platforms must be censored.

The comment that really sums up his worldview is when he's asked about changing market behavior, whereby people mutlitask while watching TV. He says:

“I’m okay with a little bit of disruption, and let’s see what happens. I dunno. I’m good with it.”

This is the common viewpoint of the legacy player about to be disrupted in a big, bad way. They always insist that they're okay with disruption -- but in moderation. There are two really funny things about this quote. The first is the idea that disruption comes in bite-sized increments. That's not how it works. Disruption comes in massive waves that are unstoppable. And that leads to the second funny thing: he seems to think that his opinion on disruption and whether or not he's "good with it" matters to whether or not it will actually happen.

The disruption is already underway. And, for now, it looks like Emanuel's still hanging on to his cash-cow horse buggy business, while insisting that the road pavers really need to "do something" about those dangerous "automobile" things.
http://www.techdirt.com/articles/201...y-button.shtml





Dear Ari Emanuel: We're All Meeting On The Internet, Come Join Us
Mike Masnick

We recently posted about Hollywood super agent Ari Emanuel's ridiculous demands that Google somehow find the magic "stop piracy" button. That story is turning into something much more interesting. The next day, at the same conference, a Google exec, Susan Wojcicki, pointed out the obvious: that Emanuel doesn't know what he's talking about (she used a more diplomatic phrase, noting that he was "misinformed").

Emanuel has since shot back that he's not at all misinformed about the need for the geeks in Northern California to solve his problems:

I am misinformed about a lot — just ask my wife — but I’m not misinformed about this: One of our last remaining dominant American exports is our creativity, no matter how you define it, either as a story or as an algorithm. There is equal genius behind companies like Apple, Facebook, Amazon and Google as there is behind artists who create stories that resonate around the world. We need to protect America’s intellectual property and Hollywood can’t do it on its own. I understand that the onus is not entirely Google’s, but let’s stop talking at each other and get in a room with all parties to figure this out. To be clear, I don’t want to rehash SOPA as we can all agree that was a reflection of Southern California’s arrogance, and let’s also not pretend that we’re working together on this issue because we have Youtube channels together. This is a larger conversation. It’s time for Hollywood, our government and Silicon Valley to step up and collectively resolve this problem. Let me know where and when and I’ll be there.

Ari

The problem, of course, is that his very premise is wrong. He's taking the position that we need to "protect" first, rather than just fix our business models. This is a very mercantilist viewpoint: where protectionism beats innovation. But we've got centuries of economic proof that that's not how you evolve and it's not how you innovate and compete. What you do is you figure out ways to add value and to embrace new business models. Any effort that starts from the default position that what we need is more "protection" rather than greater innovation is doomed to fail -- because that innovation is an unstoppable train, and the "protection" aspect doesn't work. So if you don't focus on the innovation, then someone else will, and you'll have wasted all your time, effort and money on a "solution" that simply drives your business somewhere else. To the place that has focused on innovation.

But, even worse, is his arrogance in thinking that this is a problem that requires "Hollywood, our government and Silicon Valley to step up and collectively resolve this problem." This is the same thing we've been hearing for months out of Chris Dodd and the Hollywood crew: it's time to get back into the backroom and craft "a deal." That's how they think, but it completely misses the point. This isn't about crafting a backroom deal, it's about recognizing the power of the internet, and the importance of the internet to people.

Every time a Chris Dodd or an Ari Emaneuel suggests a backroom deal between Hollywood, Silicon Valley and the government, he leaves out the people who actually matter: all of us, out here, on the internet.

And, to that point, if he wants to know "where" this larger conversation is happening: it's right here. On the internet. It's on news sites and social media sites. It's on Reddit and Twitter and Facebook. It's here on Techdirt and lots of other blogs. We live on the internet and this conversation has been happening for a decade. Ari and his buddies have always been welcome to join, so it's a bit disingenuous for him to suggest that he'll "be there" when we tell him where "the meeting" is. It's here. It's going on all around you and you've always been welcome to join. But you don't. And, no, I won't even get into the irony of him demanding a "meeting" when Hollywood did absolutely everything to keep the rest of the world out of the backroom meetings that led to SOPA.

Joshua Topolsky, the editor in chief of The Verge -- who challenged Emanuel, and was rudely told to "go sit down" and had Emanuel ask "where do you work?" -- has written his own response, in which he tells Emanuel he works on the internet:

What Ari seems to forget, and what maybe politicians and the film and TV industry seem to forget is the last time piracy was a flashpoint between the entertainment and tech industries, the problem was not solved by sledgehammer legislation. Or takedowns. Or yelling. It was solved by the music industry accepting that their old model was broken, and technologists figuring out a new way to do business. And that gets to the core of this problem for Ari. We didn't go back to the way things were after the RIAA sued college students — the industry changed.

He doesn't want to change his business model, and he will do anything he can to protect it — including altering the basic functionality of the internet. Pirating and Apple's resulting rise in the music business changed that business forever... and diminished its financial footprint. Entrenched companies that owned every part of the food chain suddenly discovered they were just another cog in a big wheel.

Ari doesn't want that anymore than the music industry wanted it, or traditional media wanted it. Ned Ludd and his machine wreckers didn't like change either.

But there is one simple truth that I really believe in, in life or in business: adapt or die.

You want to know where I work Ari? I work on the internet. Welcome aboard.

I'd argue it goes even further than that. We don't just work on the internet. We live and breathe the internet. It is our identity. Emanuel looks at the internet, and he doesn't get it. To him, it's just a version of television that doesn't pay as well, so that's not interesting. In his talk, he repeatedly demanded a business model that pays as well as TV. That's not how this works. Disruptive innovation doesn't wait until you go back and provide the legacy players with a business model that pays just as well as the old business model. That's not disruption. Disruption works because the legacy players are too shortsighted to see the trend lines, and so infatuated with their fat profits that they don't recognize the potential of the new mediums, and only seek to regulate against them becoming too pesky. The train companies pushed for legislation requiring all automobiles be preceded by a person walking on the road waving red flags.

Emanuel is asking for everyone to come up with the next version of red flag laws for the internet. That's not how this works.

If he wanted a real conversation, it wouldn't be focused on the parameters of how do we set up protectionist, mercantilist barriers. It would be on how do we create more value and then monetize that value. And those conversations are happening all the time, all over the internet. He's welcome to join. He's always been welcome to join. But it requires doing a little actual working and living on the internet.
http://www.techdirt.com/articles/201...-join-us.shtml





RIAA Demands Unlimited DMCA Power From Google
Ben Jones

When it comes to entitlement, few private companies can match the RIAA. The latest cause of their whines is Google. After Google published their report last week on DMCA takedowns, the RIAA is determined to make out that Google is the problem, because almost 1.25 million removed links in one year wasn’t enough, and it’s all Google’s fault, despite the search giant having absolutely no hand in putting any of them online.

Poor Google can’t do anything right in the RIAA’s eyes.

The Mountain View search engine is being lambasted by the Washington DC lobby group for not being proactive enough with the tools they have provided to deal with the alleged copyright infringements of completely unconnected third parties.

Worse, it’s claimed that Google are actively hindering the RIAA, because they’re not allowing the industry group free reign to have each and every suspect link terminated perpetually.

When Google published their report on DMCA takedowns last week, the RIAA was unimpressed. In fact, they were so unimpressed by the average of ONLY 3,400+ links taken down each and every day, that they did what any well-connected lobby group would do – it took to its blog and wrote a top-5 list of facts on why it’s ALL GOOGLE’S FAULT!

Fact 1

Google places artificial limits on the number of queries that can be made by a copyright owner to identify infringements.

Because nothing says “problem sorted” like allowing someone else’s bots unrestrained access to your data. Of course, the RIAA should be free to run as many search bots as they want, potentially hindering the search engine’s core business as they hunt down potentially infringing links. The RIAA is after all a big fan of DDOS’s, having been been the target of a few themselves. And it is better to give, than to receive, which is why the RIAA would like the ability to share one with the Google links database.

Fact 2

Google also limits the number of links we can ask them to remove per day.

As we’ve seen before, nothing says “accuracy” like a stream of bot-generated links. It’s impossible to churn out an unlimited number of links with human oversight, and we’ve see how well that’s worked in practice, time and again. Since such takedowns are meant to be submitted under ‘penalty of perjury’, it’s clear that Google is just looking out for the RIAA, preventing them from committing so many perjurious acts that penalties would have to be enforced. Thanks to Google, the RIAA is being saved from itself.

Fact 3

The constraints Google has placed on the tools they promote to deter infringement are well below what is necessary to identify and notice infringements on the Billboard top 10, much less the entire catalog of the American creative community.

If the number of takedowns were so limited, and so inadequate, then surely better care would be taken to ensure accuracy. Earlier this year, in a submission to the New Zealand Government, Google noted that 37% of DMCA notices it received were not valid claims, and 57% targeted a competitor. Perhaps if these notices were better used, there would be enough to do what the RIAA wants. And yes, apparently the RIAA speaks for the entire ‘American creative community’ now.

Fact 4

Google claims that the DMCA notices it has received for a site represent less than 0.1% of the links it had indexed for the domains at the top of this list. But this number is misleading given the constraints imposed by Google on a copyright owner’s ability to find infringements and send notices to Google.

Since Google indexes so many links using their own resources, it’s just not right that the RIAA can’t have unlimited use of those same resources, for free of course.

As already discussed, it’s clear that were the RIAA able to have a freer hand to determine what Google can and can’t index, there would be a lot more than 0.1%. Where there’s 0.1%, they’re sure that it could be 10%, and if there’s 10%, then there might well be 100%. However, those restrictions prevent the RIAA from filing those notices, or even finding out. And the 37% of claims that are false? They are just collateral damage, for the Greater Good, nothing to worry about, much less do anything about. Besides, the RIAA knows best, and is just looking out for artists, honest!

Fact 5

If “take down” does not mean “keep down,” then Google’s limitations merely perpetuate the fraud wrought on copyright owners by those who game the system under the DMCA.

Finally, how DARE content be re-indexed if a notice has been filed? The RIAA’s position is CLEAR on this – a DMCA notice is a permanent ban on that content ever being indexed by Google again. It doesn’t matter who uploaded it, if it was a fan with a bootleg before and now it’s an official release, or even if it’s just entered the public domain or someone else has taken over the rights, it simply cannot reappear.

No matter what the copyright status is, once someone has filed a notice against it, that content should be completely banned from the internet. Because otherwise it’s a fraud on copyright owners, and not the kind where RIAA members claim the copyright for stuff they don’t own the rights to, or prevent the rights holder from using their own work, or lie to law enforcement to get goods seized. That kind of ‘copyright fraud’ is clearly acceptable, unlike the former examples.

Sending almost 2-in-5 DMCA notices that are bogus, safe in the knowledge that false claims won’t be punished is another fine example of how to game the spirit of the DMCA in an acceptable manner.

If the tone here has verged into the absurd, there’s probably a good reason. The RIAA’s demands are sheer lunacy. If the RIAA wants its demands to be heard, then first it needs to get its own house in order, before their abuses of the law are noticed and wipe them out. To blame Google for their own shortcomings is more of the same myopia that has left them playing catchup for the last 13 years, but who is surprised by that any more?
https://torrentfreak.com/riaa-demand...google-120502/





Should the Government Ban File-Sharing Websites?

Entire sites can’t be banned because of a few users violating copyright but the internet can’t be used to perpetuate such infringements

Prashant Reddy
Curator, SpicyIP.com

“A more reasonable interpretation of the court orders would require, not ISPs, but only “un-named” file-sharing websites to remove the offending files or links from their websites”

Over the last year, the Delhi and Madras High Courts have granted several “John Doe” orders on the request of the producers of movies such as Singham, Bodyguard, Don 2, Speedy Singh, 3 (featuring the Kolaveri Di song) and Dhammu.

The novelty of these “John Doe” orders lies in the fact that they can be enforced against persons and corporations that are not even named in the original lawsuit. These “extraordinary” orders trace their origin to a Billy Joel concert in the US, where Joel’s representatives needed an interim arrangement to seize and restrain “fly-by-night-operators” – small-time vendors – from selling Joel-related merchandise outside concert venues without prior authorisation from the artiste. These vendors would appear right before the concert and disappear shortly after and there was no way to sue them without a judicial innovation that did away with the most fundamental requirement of civil procedure — naming the defendant in the lawsuit.

In India, such “John Doe” orders were originally granted to sports broadcasters like ESPN to enforce against cable operators illegally broadcasting sporting events such as the soccer or cricket World Cup. Gradually, producers such as Reliance Big Entertainment started to seek such orders against “cable operators” who were making it a habit to broadcast new releases of big-banner movies. Given the increased internet penetration in India and the popularity of file-sharing sites among techy-savvy Indians, it is no surprise that production houses have started to move against “file-sharing” websites and ISPs.

Using the original orders against cable operators as precedents, the producers of the aforementioned movies have convinced the courts to issue similar interim injunctions against “un-named” defendants, presumably “file-sharing websites” and a number of “named” ISPs such as Airtel, Hathaway and so on without first giving them an opportunity to be heard.

The most serious problem with these orders lies in the manner in which they are being interpreted. For instance, all of the Delhi High Court orders, coincidentally passed by the same judge, and the Madras High Court order forbid the named and unnamed defendants from violating the copyright in the said films “through different mediums like CD, DVD, Blue-ray, VCD, Cable TV, DTH, Internet, MMS, Tapes, Conditional Access System or in any other like manner”. In all these cases, ISPs and the producers seem to have interpreted the term “internet” to block entire websites.

File-sharing sites can be used to share a large number of files that may or may not be legal and it makes no sense to shut down the entire website because a few users are violating copyrights.

It would be unreasonable to assume that the Delhi High Court and the Madras High Court would instruct the closure of an entire website for the simple reason that some of the users of the websites are violating copyright law by sharing infringing copies of the movies in question. For example, in previous cases by music companies against YouTube, the Delhi High Court had ordered the removal of only specific content from YouTube without ordering the entire video-sharing website to be shut down. Thus, a more reasonable interpretation of such orders would require, not ISPs, but only “un-named” file-sharing websites to enforce such orders by removing the offending files or links from their websites and even that is required to be done only when the producer can identify such offending files or links. In normal circumstances, such blatant misrepresentation of judicial orders would invite the wrath of contempt proceedings.

The larger question, however, is whether cable-operators, ISPs and popular file-sharing websites can be equated to the fly-by-night vendors at Joel’s concert. In my opinion, there is simply no comparison.

Pavan Duggal
Cyberlaw expert

“Some portions of the websites – which violate the intellectual property rights of relevant stakeholders – could be banned. However, this is the best that the government can do”

In today’s context and given the nature of the internet’s architecture, it is impossible for any country to completely, absolutely and unconditionally ban a website. The internet has made geography a thing of the past and because of this it is impossible for any government to ban a website for an indefinite period. Banning is an antiquated phenomenon and has no relevance in today’s times. However, sometimes it may come to the notice of a country’s government that certain websites and file-sharing sites are infringing copyrights and other intellectual property rights of different stakeholders by continuing to host, transmit and display pirated copies of literary, artistic, cinematographic and dramatic works of original copyright holders. In such a situation, it cannot be asserted that governments are powerless and that they should not take any action.

In India, we have a strong intellectual property rights legal regime that includes the Indian Copyright Act, 1957; the Trademark Act, 1999; and the Patent Act. As such, it is but natural to expect that the Indian government would want to block at least those portions of the electronic content hosted on such sites that violate the intellectual property rights of legitimate holders. In such a case, some portions of the websites – which violate the intellectual property rights of relevant stakeholders – could be banned. However, this is the best that the government can do. It has to appreciate the fact that imposing a ban brings unnecessary media exposure and unwarranted internet traffic to the banned website. Moreover, given the internet’s inherent design, it is always possible for users to access the banned content indirectly on other websites.

Governments across the world have to realise that the internet is a free paradigm and its inherent nature does not permit absolute control. File-sharing websites, to the extent that they use legitimate non-infringing content, can help boost creativity and enhance the market for entertainment. There is a need to come up with a proactive approach that takes care of the various requirements of all stakeholders. Therefore, we need an approach that not only protects the internet as a legitimate platform for spreading information and entertainment, but also protects the intellectual property rights of various stakeholders.

Moreover, the government must also understand that though it has mandated all internet service providers, or ISPs, to block any electronic content on various grounds, ISPs are still not deploying the various technological means and methodologies so as to block only the relevant content directed and not the website. Consequently, we find that on various occasions, ISPs have been blocking the entire website, when the court or the government in question has only ordered the blocking of specific content on specific websites.

With the Indian Copyright (Amendment) Bill, 2010, now being passed by both the Houses of Parliament, the Copyright Act would, hopefully, be strengthened so as to be extremely relevant and topical in the context of the electronic ecosystem. However, we need more innovative and holistic approaches to deal with piracy on the internet. Blocking a website is a redundant exercise that has outlived its utility, given the internet’s ubiquitous nature. Governments across the world have to look at more pragmatic ways of dealing with copyright infringements and piracy on such websites, while ensuring that at no time should the access to legitimate content be blocked.
http://www.business-standard.com/ind...bsites/475701/





How to Work Around Comcast’s File-Sharing Crackdown

Don’t be scared of technobabble. You can do this.
Nick Vadala

If you can’t get the Feds to do it, you’d better do it yourself. Starting July 1st, major American Internet service providers will become copyright cops for the MPAA and RIAA in what supporters call one of the most promising anti-piracy efforts in history. ISPs onboard for the multi-million dollar plan include Time Warner Cable, AT&T, Cablevision, Verizon and, of course, Comcast, which connects one-fifth of wired homes. The six-strike “graduated response” program focuses primarily on copyrighted content on BitTorrent, a popular peer-to-peer (P2P) sharing program that allows decentralized downloading by having users snag files from a number of sources or “seeds” across the web.

The real problem here is that the RIAA, MPAA and major ISPs are serving as officer, judge and jury with essentially no checks and balances until you decide to pay $35 for a purportedly independent review board to look over your case (you get the money back if you win). Beyond that, these measures treat the use of BitTorrent as an expressly unscrupulous activity, which is no surprise considering Hollywood’s historical incredulity at tales of legitimate use and the ineffectuality of “piracy” on sales—even as individual artists and celebrities embrace the program’s distribution efficiency.

While this system is far more logical than older methods that led to clogged courts over petty violation claims (mainly for uploading, not downloading), it’s still essentially a bandage over the gaping wound of the entertainment industry’s ever-failing business and distribution model. What’s more, the flaws inherent in the new system render it remarkably easy to bypass. And even if it does work technically, similar European programs have had little effect on file sharing.

So until ol’ Hollywood drops the cop shtick and starts playing businessman again, here are some tips to circumvent the upcoming torrent crackdown:

1. Get a VPN.

This whole monitoring scheme is based around the MPAA and RIAA scanning popular P2P networks and torrent sites for copyrighted material and reporting IP addresses of those in the download swarm to the appropriate ISPs. Naturally, the simplest way to avoid that is to mask your IP address. The easiest way to do that is by subscribing to a Virtual Private Network, a monthly service that routes all web traffic through a set of servers that hide your real IP from public view to ensure privacy. VPNs that don’t store logs of their users’ online activity are best, as they leave no trail to track. Popular P2P-centric VPN providers include BTGuard, Ipredator, StrongVPN and TorGuard.

2. Use a proxy service.

Professional geeks usually pull this term out to confound the technically illiterate, but don’t let the technobabble scare you. Proxy services operate similarly to VPNs, but they don’t re-route all of your Internet traffic through a set of remote servers. Instead, proxies simply mask certain programs and protocols, making them simpler in function than many VPNs and particularly useful for BitTorrent. There are many services aimed at torrent users, but TorrentPrivacy and BTGuard’s proxy service are popular choices due to the encryption services and built-in download clients they provide. A bonus over VPNs: Less fuss means faster speeds overall.

3. Buy a seedbox.

If you’re a hardcore torrenter (or just paranoid), VPNs and proxy services might not offer the level of convenience and function that you want or need. Essentially torrent-ese for “dedicated high-speed server,” seedboxes provide users with anonymity by downloading torrent files to a remote machine not attached to their IP address. From there, the files can be downloaded to the user’s primary computer without BitTorrent, allowing for a secure and anonymous process. Beyond security and anonymity, seedboxes also offer extremely fast upload and download speeds, with most providers hosting boxes over a 100Mbit connections. They aren’t cheap (around $100 monthly on average), but popular seedbox hawkers include Superseedbox, Dediseedbox and Extremeseed.

4. Access a closed torrent community.

Because the MPAA and RIAA will be scanning open P2P networks and torrent sites like The Pirate Bay (and because they have to join the download swarm to see who else is downloading), private torrent communities are much less likely to be monitored. The downside is that most private torrent trackers require users to maintain a download/upload ratio of 1:1, lest they incur penalties like the banhammer (and uploading, in terms of legality, is a big no-no). To get into one of these sites, a member must invite you to register, so you literally need to know a guy. If you can manage, though, preferred sites include Demonoid, PassThePopcorn and What.CD.

5. Consider alternative methods.

By focusing primarily on torrenting, the MPAA and RIAA are only monitoring a fraction of the file-sharing sources that Internet users utilize, which leaves a slew of other options wide open. All-but-forgotten utilities such as Internet Relay Chat (IRC) and Usenet are still hotbeds of file-sharing activity. The ever-growing Freenet project, which offers users the ability to share files, chat and browse anonymously, is another good alternative to BitTorrent and currently has around two million users. Streaming portals such as Hulu, Veoh and even YouTube offer full video streams of television and movies. And then, of course, there are the digital storage lockers such as MediaFire, YouSendIt and RapidShare, which allow users to simply upload and distribute large files without being tracked.
http://blogs.phillymag.com/the_phill...ent-crackdown/





Pirate Bay Ready For Perpetual IP-Address Whac-A-Mole
Ernesto

Last week The Pirate Bay added a new IP-address which allows users to circumvent the many court-ordered blockades against the site. While this proved to be quite effective, the Hollywood backed anti-piracy group BREIN has already been to court to demand a block against this new address. But that won’t deter The Pirate Bay, who say they are fully prepared for an extended game of whac-a-mole using the hundreds of IP addresses they have available.

The Pirate Bay is arguably the most censored website on the Internet.

Courts all around the world have ordered Internet providers to block subscriber access to the torrent site, and the end is still not in sight.

Within a few days, a new deadline for five UK and five Dutch Internet providers passes. This means that millions more will be unable to access The Pirate Bay, at least, that is the plan.

Last week The Pirate Bay team responded to the blockades by adding a new IP-address. The new location was setup to make it easier for people to start their own dedicated proxy sites, but it also allows blocked Pirate Bay visitors to gain access to the site.

Instead of the normal address they simply go to 194.71.107.80, bypassing the court order – for the time being at least.

The new IP-address represents a new thorn in the side of Dutch anti-piracy group BREIN, who quickly asked ISPs to censor that too. Unfortunately for them the providers refused to do so, so the group had to go to court once again last week to get the added IP-address blocked as well.

Right before the weekend BREIN succeeded with the court ordering an ex-parte injunction for the new address. However, according to comments coming out of The Pirate Bay, this could just be the start of an extended game of whac-a-mole.

“Let me get the next IP-address lined up,” a Pirate Bay insider told TorrentFreak. “We have hundreds, so let’s see many times they will respond,” he added.

We were told that if the new IP-address is blocked again, they will simply add a new one. This means that BREIN would have to file for another ex-parte injunction, a process that may repeat itself hundreds of times.

The Pirate Bay insider did emphasize that the new IP wasn’t meant for people to bypass the blocks directly, but to make it easier and more safe to create proxy sites. In this regard, it is irrelevant whether the IP-address is blocked or not.

However, it’s well known that The Pirate Bay isn’t averse to a little dueling with anti-piracy outfits, so they’re going to play along.

“Now that I know it’s annoying to BREIN, of course we’ll add more IPs. Every time they get an order, we’ll add a new one, for the next year or so,” TorrentFreak was told.

The result is an almost endless IP-address whac-a-mole.

The Pirate Bay blockades are a good example of how hard it is to completely get a website offline. Even if all Pirate Bay domains and IP-addresses are blocked there are plenty of other ways to access the torrent site, including hundreds of proxy sites.

At the same time, the blockades make The Pirate Bay front page news. As we’ve seen before, this can result in a healthy traffic boost for the deviant torrent site. That begs the question of whether these censorship attempts aren’t doing more ‘harm’ than ‘good’ for copyright holders.
https://torrentfreak.com/pirate-bay-...a-mole-120528/





New Zealand Judge Orders US to Hand Over Megaupload Documents

Questions whether civil copyright violations can lead to criminal liability
Timothy B. Lee

Megaupload founder Kim Dotcom and his co-defendants scored a significant victory on Tuesday when a New Zealand judge ordered the United States government to hand over evidence the defense will need to prepare for an upcoming extradition hearing. He rejected the government's argument that the defendants should make do with the information about its case the government itself chose to introduce in court.

The judge's comments in the 81-page decision, which was provided to Ars Technica by Dotcom attorney Ira Rothken, suggest that he is conscious of Dotcom's trying circumstances and the unusual nature of the case against him. "Actions by and on behalf of the requesting State have deprived Mr. Dotcom and his associates of access to records and information," wrote Judge David Harvey, alluding to the fact that dozens of hard drives were taken from the Dotcom mansion during the January raid and have not been returned. Dotcom, Judge Harvey wrote, "does not have access to information which may assist him in preparation for trial."

Harvey described the case as "more complex than many. The United States is attempting to utilize concepts from the civil copyright context as a basis for the application of criminal copyright liability," he wrote. That "necessitates a consideration of principles such as the dual use of technology and what they be described as significant non-infringing uses."

Rothken said that Judge Harvey's discussion of these issues is a good omen for his client. "It's our view that there's no such thing as a criminal Grokster," he told us, referring to the landmark Supreme Court decision that established copyright liability for inducing copyright infringement by others. In civil cases like Grokster, defendants faced only financial penalties, not jail time. Some legal scholars have expressed skepticism that inducing others to infringe copyrights can be the basis for criminal copyright liability.

An extradition hearing is intended to be much quicker and simpler than a criminal trial, but Judge Harvey must still determine whether the US government has a plausible case for Dotcom's guilt. With a trove of documents furnished by the United States, the Dotcom legal team will be better positioned to argue that it doesn't.

In a separate ruling, Judge Harvey allowed Dotcom to return home to his mansion. He had been barred from the mansion because it was not suitable for the electronic monitoring system he was ordered to wear. He and his family were forced to move to another house nearby. But Judge Harvey has concluded Dotcom is not a flight risk and freed him from electronic monitoring requirements, allowing him to return home.
http://arstechnica.com/tech-policy/2...oad-documents/





Julian Assange Loses Extradition Appeal at Supreme Court
BBC

Wikileaks founder Julian Assange has lost his UK Supreme Court fight against extradition to Sweden to face accusations of sex offences.

Lord Phillips, the court's president, said a majority of five justices to two had ruled against Mr Assange.

The court ruled the extradition request had been "lawfully made".

However, Mr Assange has 14 days to challenge the ruling and his solicitor, Gareth Peirce, said his lawyers would be asking the court to reconsider.

Mr Assange, who has been on conditional bail in the UK, did not attend the hearing in central London. His lawyer later told reporters he had been "stuck in traffic".

Following the hearing, he tweeted: "We got the news not hoped for."

The Wikileaks website published material from leaked diplomatic cables, embarrassing several governments.

'Judicial authority'

The role of judges in cases like Julian Assange's appeal is to listen to the points being put forward by both sides and decide who has the best argument.

But Mr Assange's legal team are suggesting that didn't happen in this case.

They appear to think he has lost his appeal because the judgement from the UK's highest court is based on a point which was neither heard nor argued in the case.

If this is so, the Supreme Court will find itself in the extraordinary position of having ruled against Mr Assange on a point that his lawyers did not have a chance to consider or respond to.

If true, that would mean the judgement is arguably unfair - and that is why in two weeks' time the court could be in the unprecedented position of having to reopen the case.

The 40-year-old Australian is accused of raping one woman and "sexually molesting and coercing" another in Stockholm in August 2010, but he claims the allegations against him are politically motivated.

His lawyers had asked the court to block his extradition, arguing that a European arrest warrant issued against him was "invalid and unenforceable".

The key legal question was whether the Swedish prosecutor who issued it had the "judicial authority" to do so under the 2003 Extradition Act - or whether the words gave that power only to a court or a judge.

Lord Phillips said five of the seven Supreme Court justices had agreed the warrant was lawful because the prosecutor could be considered a proper "judicial authority" even if this was not specifically mentioned in legislation or international agreements.

However, this point of law had not been simple to resolve, said Lord Phillips, and two of the justices, Lady Hale and Lord Mance, had disagreed with the decision.

Lord Phillips said the meaning of the words had been debated in Parliament when the Extradition Act was being drawn up and at least one minister had - in his view, wrongly - said they could only apply to a court or judge.

But Dinah Rose QC, for Mr Assange, said she could challenge the Supreme Court's decision because it relied on a 1969 convention relating to how treaties - such as those concerning extradition - should be implemented, and this had not been discussed during the hearing.

In a statement, the Supreme Court said: "Ms Rose suggested that the majority of the court appear to have based their decision on the interpretation of the Vienna Convention on the Law of Treaties, on which no argument was heard and no opportunity of making submission was given.

"The Supreme Court has granted Ms Rose 14 days to make such an application.

"If she decides to do so, the justices will then decide whether to re-open the appeal and accept further submissions either verbally through a further hearing, or on paper, on the matter."

The decision to stay the extradition order means that it cannot become active until at least 13 June.
http://www.bbc.co.uk/news/uk-18260914





China Cracks Down on Its Cagey Web Critics
Michael Wines

One of China’s largest hosts of Twitter-like microblogs decreed new punishments on Monday for users who post comments that its editors — and by extension, China’s government censors — deem inappropriate.

The service, Sina Weibo, imposed “user contracts” that award each of its 300 million microbloggers a starting score of 80 points, from which points can be deducted for online comments that are judged offensive.

When a blogger reaches zero, the service stated, a user’s account will be canceled, but users who suffer lesser penalties can restore their 80 points by avoiding violations for two months.

Points will be deducted for a wide range of violations, including spreading rumors, calling for protests, promoting cults or superstitions and impugning China’s honor, the service stated.

Most notably, the contract also will punish time-honored tactics that bloggers use to avoid censorship, like disguising comments on censored topics by using homonyms (where two different Chinese characters have nearly identical sounds), puns and other dodges.

To evade censors, for example, bloggers have referred to the dissident artist Ai Weiwei by using Chinese characters for “love the future,” a rough homonym for his name. Such ploys would be punished with a loss of points under the new rules.

The restrictions on comments are not new by themselves. Throngs of government censors already control what appears on the Internet, and corporate minders at Sina Weibo and other sites have long complied with their orders, deleting offensive comments, sly homonyms and other posts that rile government sensibilities.

The point system, however, appears to be a muted effort to extend that control by warning users when they approach the boundaries of official tolerance. Internet companies like Sina, which are privately operated, tread a thin line between too-lax censorship that might draw government punishment and overly strict rules that would quash the lively debates that make the services popular.

The new rules were announced in early May and took effect on Monday.

Chinese propaganda authorities have progressively clamped down on the freedoms of Internet users since last year, when a high-speed train wreck in Zhejiang Province unleashed an online flood of angry anti-government comments.

Censors have all but shut down comments this spring on embarrassing incidents involving Bo Xilai, the Politburo member suspended over a murder investigation involving financial dealings with a British businessman, and Chen Guangcheng, an internationally known dissident who sought refuge last month in the United States Embassy in Beijing.

The government briefly banned users from commenting on microblog posts on Sina Weibo and a rival service, Tencent QQ, apparently as a warning against spreading rumors about government instability surrounding Mr. Bo’s troubles.
https://www.nytimes.com/2012/05/29/w...b-critics.html





Bomb Under ACTA: Lower House Against

No Acta
Rene Schoemaker

Netherlands should finally say "no" against the anti-piracy treaty ACTA. Waiting to vote in the European Parliament take D66 and VVD is not necessary. A majority in the Chamber agree with them.

A motion by Kees Verhoeven (D66) and Afke Schaart (VVD) is treated this afternoon in the Competitiveness Council later this afternoon and vote in the House. According to Verhoeven's motion will be adopted by a majority of the House. PVV, GL, PvdA and SP in the past have repeatedly criticized the controversial ACTA trade agreement. There is now also at government party VVD.

Final farewell to ACTA

Thus, the Netherlands and finally land a long time after saying goodbye to the Anti-Counterfeiting Trade Agreement (ACTA). This international treaty is intended to facilitate trading of counterfeit goods falling under copyright combat. This includes also offered music, movie and software downloads that fall under copyright protection.

Motion-sponsored Kees Verhoeven does not want to wait until the European Parliament will vote on ACTA. That will happen in July . "The ACTA treaty disappears anyhow table, whether for or against the European Parliament vote," says Verhoeven in a statement. If the motion is passed, it seems obvious that the government still ACTA will provide for ratification to parliament.

Cabinet has not yet signed

The Dutch government has already waived putting a signature on the treaty under pressure from the House . Who wanted to know whether the provisions of the treaty go against civil rights. The government made the proposal that opinion to the Council of State to ask, but who sees such a judgment because the European Commission on such a judgment even asked the European Court of Justice.

Verhoeven finds that the treaty's Internet freedom and privacy of citizens and businesses in danger. He brings a second motion to the vote contains the call to the government in the future similar treaties "that tamper with a free and open Internet" to shoot.

Update 15.47: The motion of VVD and D66 was adopted unanimously in the House. That means that even in the Cabinet ACTA approval by the European Parliament to the House not need to offer to ratify. The CDA, the VVD, like a half years ago wholehearted supporter of ACTA, voted for the motion.

In addition, a motion of the PVV members Van Bemmel and Elissen the government to call ACTA definitely not to sign, a majority achieved. It voted against the CDA or if any party.

A motion of Verhoeven to continue not to agree to treaties like ACTA holds a majority.

Incidentally took Verhagen (Economic Affairs) during the discussion of the motion which the VVD member Afke Schaart with D66 colleagues Verhoeven had made out properly to the VVD politician. Verhagen took the attitude of Schaart "inconsistent" because she and her colleagues from the PVV has previously had insisted on rapid signing of ACTA by the Dutch government.
http://translate.google.com/translat...---update.html





Dead on Arrival? Dutch Parliament Kills ACTA Before EU Vote

Lawmakers in Holland have voted to strike down the international Anti-Counterfeiting Trade Agreement (ACTA), slammed by many as a free speech and information access choker. Dutch MPs have also ruled the government will never sign any such agreement.

The Dutch parliamentarians have opted not to wait for the EU’s vote on ACTA which is set for June, with consultations kicking off already this Thursday.

"The treaty should be taken off table, whatever the decision the European Parliament should take," said MP Kees Verhoeven, a major sponsor of Tuesday’s motion in the Dutch Parliament.

Lisa Neves Goncalves, a spokeswoman for the Dutch Ministry of Economic Affairs, Agriculture and Innovation, said the government had earlier this year stated it would not sign off on the treaty until it was clear it did not breach the Dutch or EU constitution.

As the controversial bill is making its slow way through the EU Parliament, the UK Pirate Party, the Open Rights Group (ORG) and the French La Quadrature Du Net are calling for more anti-bill rallies.

"The votes this Thursday, in three of the Committees responsible for offering 'Opinions' on the treaty, will really affect whether the European Parliament ultimately rejects ACTA or not. It is important that your MEP understand people's concerns. And calling your MEP will help make this happen," says the Open Rights Group in a blog post.

ACTA is an international agreement aimed at protecting intellectual property. It somewhat resembles the US’s Stop Online Piracy Act (SOPA), which was shelved by lawmakers after protests.

The European Union suspended efforts to ratify the treaty in February amid a storm of protest from activists who say the agreement would stifle free speech and access to information. Thousands demonstrated across the EU against giving big firms the power to ban people from using the Internet for illegally swapping files. Twenty-two countries in the bloc signed up to the agreement, with a vote on its ratification due this summer in Brussels.

The US, most of the EU, Australia, Canada, Japan and several other countries have signed the ACTA treaty, but none of these signatories' parliaments have yet ratified it. This last step would make the agreement viable. As soon as ACTA is ratified by any six nations, the convention will come into force.
https://rt.com/news/dutch-parliament-rejects-acta-518/





ACTA Rejected by EU Parliament Committees in Crucial Vote

The European Parliament has opposed the controversial ACTA treaty, after three of its influential committees said the trade agreement should be rejected.

The Legal Affairs Committee (JURI), the Committee for Industry, Research and Energy (ITRE) and the Committee for Civil Liberties, Justice and Home Affairs (LIBE) all voted against implementing the agreement, which caused mass protests in several European countries this year.

In ITRE, the votes were split 31 members for and 12 votes against a draft opinion which called on the Parliament to reject ACTA. One member abstained.

In JURI, 10 votes were cast for a pro-ACTA draft opinion and 12 against, while two committee members abstained. The small-margin victory still went to opponents of the treaty.

LIBE also sided with critics of the treaty, with 36 members voting for a negative report on ACTA, 1 against and 21 abstaining from the vote.

The cold shower news for the trade agreement does not seal its fate. The next vote on it by Committee on International Trade (INTA) of the European Parliament will take place on June 21. It will be the fourth and final opinion the committees are to submit before ACTA is taken to a plenary session in early July.

Earlier on Tuesday Dutch legislators voted to ax ACTA, saying the government of the Netherlands will never sign it. They said they would oppose it even if the European Parliament approves the treaty.

The Anti-Counterfeiting Trade Agreement (ACTA) is aimed at protecting copyright in many industries, from software engineering to agriculture. Critics say the national governments would have to make a draconian attack on online privacy to implement provisions of the treaty on their soil.

The European Union suspended efforts to ratify the treaty in February amid a storm of protest from human rights activists. Thousands demonstrated across the EU against ACTA and the amount of power it would give to big corporations.
https://rt.com/news/acta-eu-parliament-internet-670/





The Secret Lives of Dangerous Hackers
Janet Maslin

WE ARE ANONYMOUS

Inside the Hacker World of LulzSec, Anonymous, and the Global Cyber Insurgency

By Parmy Olson

498 pages. Little, Brown & Company. $26.99.

Postscript Appended

In December 2010 the heat-seeking Internet pranksters known as Anonymous attacked PayPal, the online bill-paying business. PayPal had been a conduit for donations to WikiLeaks, the rogue whistle-blower site, until WikiLeaks released a huge cache of State Department internal messages. PayPal cut off donations to the WikiLeaks Web site. Then PayPal’s own site was shut down, as Anonymous did what it did best: exaggerate the weight of its own influence.

But, according to “We Are Anonymous,” by Parmy Olson, the London bureau chief for Forbes magazine, it had taken a single hacker and his botnet to close PayPal. “He then signed off and went to have his breakfast,” she writes.

Even so, Anonymous made it seem like the work of its shadowy horde. “We lied a bit to the press to give it that sense of abundance,” says the figure named Topiary, one of the best sources in “We Are Anonymous,” a lively, startling book by Ms. Olson that reads as “The Social Network” for group hackers.

As in that Facebook film the technological innovations created by a few people snowball wildly beyond expectation, until they have mass effect. But the human element — the mix of glee, malevolence, randomness, megalomania and just plain mischief that helped spawn these changes — is what Ms. Olson explores best.

“Here was a network of people borne out of a culture of messing with others,” she writes, “a paranoid world whose inhabitants never asked each other personal questions and habitually lied about their real lives to protect themselves.”

The story of Anonymous and its offshoots is worth telling because of the fast and unpredictable ways they have grown. Anonymous began attracting attention after it attacked the Church of Scientology in 2008; subsequent targets have included Sony’s PlayStation network, Fox television and ultimately the C.I.A. The Homeland Security Department expressed its own worries last year.

Ms. Olson provides a clear timeline through Anonymous’s complicated, winding history. She concentrates particularly on how it spun off the smaller, jokier group LulzSec. “If Anonymous had been the 6 o’clock news, LulzSec was ‘The Daily Show,’ ” she writes.

The breeding ground for much of this was 4chan, the “Deep Web” destination “still mostly unknown to the mainstream but beloved by millions of regular users.” The realm of 4chan called /b/ is where some of this book’s most destructive characters spent their early Internet years, soaking up so much pornography, violence and in-joke humor that they became bored enough to move on. Ms. Olson, whose evenhanded appraisals steer far clear of sensationalism, describes 4chan as “a teeming pit of depraved images and nasty jokes, yet at the same time a source of extraordinary, unhindered creativity.” It thrived on sex and gore. But it popularized the idea of matching funny captions with cute cat photos too.

“We Are Anonymous” also captures the broad spectrum of reasons that Anonymous and LulzSec attracted followers. Some, like Topiary — who turned out to be Jake Davis, an outwardly polite 19-year-old from a sheep-farming community on the remote Shetland Island called Yell, who was arrested in 2011 — were in it for random pranks and taunting laughs. This book does not shy away from the raw language its principals used, as when Topiary told one victim: “Die in a fire. You’re done.” Other participants had political motivations. The New Yorker calling himself Sabu began as a self-styled revolutionary and was instrumental in getting Anonymous to invade the Web sites of top government officials in Tunisia.

A pivotal part of this book concerns the arrest of Sabu, the unveiling of his real identity as Hector Monsegur, and the F.B.I.’s subsequent use of him as an informant. Sabu’s dealings with Julian Assange of WikiLeaks are also described. Ms. Olson notes how Sabu “suddenly seemed very keen to talk to the WikiLeaks founder once his F.B.I. handlers were watching.”

Ms. Olson regards it as inevitable that neither Anonymous nor LulzSec could reconcile the divergent goals of its participants. Bullying jokesters and politically oriented hacktivists may share sophisticated knowledge of how to manipulate the Web and social media, but each faction became an embarrassment to the other. Topiary told Ms. Olson about his own long-distance contact with Mr. Assange, whom he describes as both intrigued by the saboteurs’ potential and critical of their silly side. (After sifting through 75,000 e-mails from a digital security firm, Topiary bashfully admits, one of the things that most interested him was an e-mail from the chief executive’s wife saying, “I love when you wear your fuzzy socks with your jammies.” )

The most startling conversation in “We Are Anonymous” was arranged by the author: an in-the-flesh meeting between Topiary and a person she calls William, since he remains unidentified.

William personifies the dehumanizing effects of cybercrime, and he knows it. One of his specialties is extorting pornographic pictures and then putting them to damaging use. “We split up several boyfriends and girlfriends and appalled many people’s mothers,” he recalls, about the Facebook tricks the book describes in detail. “I’d be lying if I said there was any great reason,” he adds. “I don’t feel guilty, it makes me laugh, and it wastes a night.”

Together they confirm the worst suspicions about the power of sophisticated but untethered Internet manipulation. “You could inspire some 15-year-old, or someone with a 15-year-old’s mind-set, to hate whoever you want them to hate,” William says.

Postscript: May 31, 2012

After this article was published, PayPal contacted The Times to take issue with the statements in the book that say the hackers shut down its Web site. Jennifer Hakes, a senior manager in corporate communications, said that as a result of the attacks in December 2010, “PayPal was never down.”
https://www.nytimes.com/2012/06/01/b...rmy-olson.html





Over-55s Pick Passwords Twice as Secure as Teenagers'
Jacob Aron

People over the age of 55 pick passwords double the strength of those chosen by people under 25 years old. That's according to the largest ever study of password security, which also found that most of us choose passwords that are less secure than security experts recommend.

Joseph Bonneau, a computer scientist at the University of Cambridge, analysed the passwords of nearly 70 million Yahoo! users. The data had been protected using a security technique called hashing, which ensured he did not have access to the individual accounts. He calculated the password strengths for different demographic groups and compared the results.

A comparison of different nationalities found that German and Korean speakers choose the strongest passwords, whereas Indonesians pick the weakest.

People with a credit card stored on their account do little to increase their security other than avoiding very weak passwords such as "123456". Unsurprisingly, people who change their password from time to time tend to select the strongest ones.

Traditionally, security researchers look at the difficulty of breaking every password in a database, but that makes the problem seem much harder than it is, because the most secure randomly-generated passwords are almost impossible to crack. Bonneau instead looked at more realistic attacker scenarios. "Maybe an attacker is happy to only break one per cent of accounts they have access to, or 50 or even 90 per cent," he says. "Those are all very different than 100 per cent." Another important factor is whether attackers are trying to guess the password of a particular user by typing it onto a login screen, or attempting to crack an entire leaked database of passwords. These are known as online and offline attacks respectively.

Cracking bits

Password strength is measured in bits, where cracking one bit is equivalent to the chance of correctly calling a fair coin toss, and each additional bit doubles the password's strength. On average, Bonneau found that user-chosen passwords offer less than 10 bits of security against online attacks, meaning it would only take around 1000 attempts to try every possible password, and around 20 bits of security against offline attacks.

That's surprising, because even a randomly chosen six-character password composed of digits and upper and lower case letters should offer 32 bits of security. Bonneau says the discrepancy is due to people picking much easier passwords than those theoretically allowed. He suggests assigning people randomly chosen nine-digit numbers instead, which would offer 30 bits of security against every type of attack – a 1000-fold increase in security on average. "I think it's reasonable to expect people to have the capacity to remember that, because they do it for phone numbers," he says.

Bonneau presented the findings at the Symposium on Security and Privacy in San Francisco, California, on 23 May.

"This is one of the rare studies based on a large set of passwords that are actively used and have been obtained legitimately," says Lujo Bauer, who studies passwords at Carnegie Mellon University in Pittsburgh, Pennsylvania. Most other studies are based on leaked databases that may be incomplete.
http://www.newscientist.com/article/...teenagers.html





Obama Order Sped Up Wave of Cyberattacks Against Iran
David E. Sanger

From his first months in office, President Obama secretly ordered increasingly sophisticated attacks on the computer systems that run Iran’s main nuclear enrichment facilities, significantly expanding America’s first sustained use of cyberweapons, according to participants in the program.

Mr. Obama decided to accelerate the attacks — begun in the Bush administration and code-named Olympic Games — even after an element of the program accidentally became public in the summer of 2010 because of a programming error that allowed it to escape Iran’s Natanz plant and sent it around the world on the Internet. Computer security experts who began studying the worm, which had been developed by the United States and Israel, gave it a name: Stuxnet.

At a tense meeting in the White House Situation Room within days of the worm’s “escape,” Mr. Obama, Vice President Joseph R. Biden Jr. and the director of the Central Intelligence Agency at the time, Leon E. Panetta, considered whether America’s most ambitious attempt to slow the progress of Iran’s nuclear efforts had been fatally compromised.

“Should we shut this thing down?” Mr. Obama asked, according to members of the president’s national security team who were in the room.

Told it was unclear how much the Iranians knew about the code, and offered evidence that it was still causing havoc, Mr. Obama decided that the cyberattacks should proceed. In the following weeks, the Natanz plant was hit by a newer version of the computer worm, and then another after that. The last of that series of attacks, a few weeks after Stuxnet was detected around the world, temporarily took out nearly 1,000 of the 5,000 centrifuges Iran had spinning at the time to purify uranium.

This account of the American and Israeli effort to undermine the Iranian nuclear program is based on interviews over the past 18 months with current and former American, European and Israeli officials involved in the program, as well as a range of outside experts. None would allow their names to be used because the effort remains highly classified, and parts of it continue to this day.

These officials gave differing assessments of how successful the sabotage program was in slowing Iran’s progress toward developing the ability to build nuclear weapons. Internal Obama administration estimates say the effort was set back by 18 months to two years, but some experts inside and outside the government are more skeptical, noting that Iran’s enrichment levels have steadily recovered, giving the country enough fuel today for five or more weapons, with additional enrichment.

Whether Iran is still trying to design and build a weapon is in dispute. The most recent United States intelligence estimate concludes that Iran suspended major parts of its weaponization effort after 2003, though there is evidence that some remnants of it continue.

Iran initially denied that its enrichment facilities had been hit by Stuxnet, then said it had found the worm and contained it. Last year, the nation announced that it had begun its own military cyberunit, and Brig. Gen. Gholamreza Jalali, the head of Iran’s Passive Defense Organization, said that the Iranian military was prepared “to fight our enemies” in “cyberspace and Internet warfare.” But there has been scant evidence that it has begun to strike back.

The United States government only recently acknowledged developing cyberweapons, and it has never admitted using them. There have been reports of one-time attacks against personal computers used by members of Al Qaeda, and of contemplated attacks against the computers that run air defense systems, including during the NATO-led air attack on Libya last year. But Olympic Games was of an entirely different type and sophistication.

It appears to be the first time the United States has repeatedly used cyberweapons to cripple another country’s infrastructure, achieving, with computer code, what until then could be accomplished only by bombing a country or sending in agents to plant explosives. The code itself is 50 times as big as the typical computer worm, Carey Nachenberg, a vice president of Symantec, one of the many groups that have dissected the code, said at a symposium at Stanford University in April. Those forensic investigations into the inner workings of the code, while picking apart how it worked, came to no conclusions about who was responsible.

A similar process is now under way to figure out the origins of another cyberweapon called Flame that was recently discovered to have attacked the computers of Iranian officials, sweeping up information from those machines. But the computer code appears to be at least five years old, and American officials say that it was not part of Olympic Games. They have declined to say whether the United States was responsible for the Flame attack.

Mr. Obama, according to participants in the many Situation Room meetings on Olympic Games, was acutely aware that with every attack he was pushing the United States into new territory, much as his predecessors had with the first use of atomic weapons in the 1940s, of intercontinental missiles in the 1950s and of drones in the past decade. He repeatedly expressed concerns that any American acknowledgment that it was using cyberweapons — even under the most careful and limited circumstances — could enable other countries, terrorists or hackers to justify their own attacks.

“We discussed the irony, more than once,” one of his aides said. Another said that the administration was resistant to developing a “grand theory for a weapon whose possibilities they were still discovering.” Yet Mr. Obama concluded that when it came to stopping Iran, the United States had no other choice.

If Olympic Games failed, he told aides, there would be no time for sanctions and diplomacy with Iran to work. Israel could carry out a conventional military attack, prompting a conflict that could spread throughout the region.

A Bush Initiative

The impetus for Olympic Games dates from 2006, when President George W. Bush saw few good options in dealing with Iran. At the time, America’s European allies were divided about the cost that imposing sanctions on Iran would have on their own economies. Having falsely accused Saddam Hussein of reconstituting his nuclear program in Iraq, Mr. Bush had little credibility in publicly discussing another nation’s nuclear ambitions. The Iranians seemed to sense his vulnerability, and, frustrated by negotiations, they resumed enriching uranium at an underground site at Natanz, one whose existence had been exposed just three years before.

Iran’s president, Mahmoud Ahmadinejad, took reporters on a tour of the plant and described grand ambitions to install upward of 50,000 centrifuges. For a country with only one nuclear power reactor — whose fuel comes from Russia — to say that it needed fuel for its civilian nuclear program seemed dubious to Bush administration officials. They feared that the fuel could be used in another way besides providing power: to create a stockpile that could later be enriched to bomb-grade material if the Iranians made a political decision to do so.

Hawks in the Bush administration like Vice President Dick Cheney urged Mr. Bush to consider a military strike against the Iranian nuclear facilities before they could produce fuel suitable for a weapon. Several times, the administration reviewed military options and concluded that they would only further inflame a region already at war, and would have uncertain results.

For years the C.I.A. had introduced faulty parts and designs into Iran’s systems — even tinkering with imported power supplies so that they would blow up — but the sabotage had had relatively little effect. General James E. Cartwright, who had established a small cyberoperation inside the United States Strategic Command, which is responsible for many of America’s nuclear forces, joined intelligence officials in presenting a radical new idea to Mr. Bush and his national security team. It involved a far more sophisticated cyberweapon than the United States had designed before.

The goal was to gain access to the Natanz plant’s industrial computer controls. That required leaping the electronic moat that cut the Natanz plant off from the Internet — called the air gap, because it physically separates the facility from the outside world. The computer code would invade the specialized computers that command the centrifuges.

The first stage in the effort was to develop a bit of computer code called a beacon that could be inserted into the computers, which were made by the German company Siemens and an Iranian manufacturer, to map their operations. The idea was to draw the equivalent of an electrical blueprint of the Natanz plant, to understand how the computers control the giant silvery centrifuges that spin at tremendous speeds. The connections were complex, and unless every circuit was understood, efforts to seize control of the centrifuges could fail.

Eventually the beacon would have to “phone home” — literally send a message back to the headquarters of the National Security Agency that would describe the structure and daily rhythms of the enrichment plant. Expectations for the plan were low; one participant said the goal was simply to “throw a little sand in the gears” and buy some time. Mr. Bush was skeptical, but lacking other options, he authorized the effort.

Breakthrough, Aided by Israel

It took months for the beacons to do their work and report home, complete with maps of the electronic directories of the controllers and what amounted to blueprints of how they were connected to the centrifuges deep underground.

Then the N.S.A. and a secret Israeli unit respected by American intelligence officials for its cyberskills set to work developing the enormously complex computer worm that would become the attacker from within.

The unusually tight collaboration with Israel was driven by two imperatives. Israel’s Unit 8200, a part of its military, had technical expertise that rivaled the N.S.A.’s, and the Israelis had deep intelligence about operations at Natanz that would be vital to making the cyberattack a success. But American officials had another interest, to dissuade the Israelis from carrying out their own pre-emptive strike against the Iranian nuclear facilities. To do that, the Israelis would have to be convinced that the new line of attack was working. The only way to convince them, several officials said in interviews, was to have them deeply involved in every aspect of the program.

Soon the two countries had developed a complex worm that the Americans called “the bug.” But the bug needed to be tested. So, under enormous secrecy, the United States began building replicas of Iran’s P-1 centrifuges, an aging, unreliable design that Iran purchased from Abdul Qadeer Khan, the Pakistani nuclear chief who had begun selling fuel-making technology on the black market. Fortunately for the United States, it already owned some P-1s, thanks to the Libyan dictator, Col. Muammar el-Qaddafi.

When Colonel Qaddafi gave up his nuclear weapons program in 2003, he turned over the centrifuges he had bought from the Pakistani nuclear ring, and they were placed in storage at a weapons laboratory in Tennessee. The military and intelligence officials overseeing Olympic Games borrowed some for what they termed “destructive testing,” essentially building a virtual replica of Natanz, but spreading the test over several of the Energy Department’s national laboratories to keep even the most trusted nuclear workers from figuring out what was afoot.

Those first small-scale tests were surprisingly successful: the bug invaded the computers, lurking for days or weeks, before sending instructions to speed them up or slow them down so suddenly that their delicate parts, spinning at supersonic speeds, self-destructed. After several false starts, it worked. One day, toward the end of Mr. Bush’s term, the rubble of a centrifuge was spread out on the conference table in the Situation Room, proof of the potential power of a cyberweapon. The worm was declared ready to test against the real target: Iran’s underground enrichment plant.

“Previous cyberattacks had effects limited to other computers,” Michael V. Hayden, the former chief of the C.I.A., said, declining to describe what he knew of these attacks when he was in office. “This is the first attack of a major nature in which a cyberattack was used to effect physical destruction,” rather than just slow another computer, or hack into it to steal data.

“Somebody crossed the Rubicon,” he said.

Getting the worm into Natanz, however, was no easy trick. The United States and Israel would have to rely on engineers, maintenance workers and others — both spies and unwitting accomplices — with physical access to the plant. “That was our holy grail,” one of the architects of the plan said. “It turns out there is always an idiot around who doesn’t think much about the thumb drive in their hand.”

In fact, thumb drives turned out to be critical in spreading the first variants of the computer worm; later, more sophisticated methods were developed to deliver the malicious code.

The first attacks were small, and when the centrifuges began spinning out of control in 2008, the Iranians were mystified about the cause, according to intercepts that the United States later picked up. “The thinking was that the Iranians would blame bad parts, or bad engineering, or just incompetence,” one of the architects of the early attack said.

The Iranians were confused partly because no two attacks were exactly alike. Moreover, the code would lurk inside the plant for weeks, recording normal operations; when it attacked, it sent signals to the Natanz control room indicating that everything downstairs was operating normally. “This may have been the most brilliant part of the code,” one American official said.

Later, word circulated through the International Atomic Energy Agency, the Vienna-based nuclear watchdog, that the Iranians had grown so distrustful of their own instruments that they had assigned people to sit in the plant and radio back what they saw.

“The intent was that the failures should make them feel they were stupid, which is what happened,” the participant in the attacks said. When a few centrifuges failed, the Iranians would close down whole “stands” that linked 164 machines, looking for signs of sabotage in all of them. “They overreacted,” one official said. “We soon discovered they fired people.”

Imagery recovered by nuclear inspectors from cameras at Natanz — which the nuclear agency uses to keep track of what happens between visits — showed the results. There was some evidence of wreckage, but it was clear that the Iranians had also carted away centrifuges that had previously appeared to be working well.

But by the time Mr. Bush left office, no wholesale destruction had been accomplished. Meeting with Mr. Obama in the White House days before his inauguration, Mr. Bush urged him to preserve two classified programs, Olympic Games and the drone program in Pakistan. Mr. Obama took Mr. Bush’s advice.

The Stuxnet Surprise

Mr. Obama came to office with an interest in cyberissues, but he had discussed them during the campaign mostly in terms of threats to personal privacy and the risks to infrastructure like the electrical grid and the air traffic control system. He commissioned a major study on how to improve America’s defenses and announced it with great fanfare in the East Room.

What he did not say then was that he was also learning the arts of cyberwar. The architects of Olympic Games would meet him in the Situation Room, often with what they called the “horse blanket,” a giant foldout schematic diagram of Iran’s nuclear production facilities. Mr. Obama authorized the attacks to continue, and every few weeks — certainly after a major attack — he would get updates and authorize the next step. Sometimes it was a strike riskier and bolder than what had been tried previously.

“From his first days in office, he was deep into every step in slowing the Iranian program — the diplomacy, the sanctions, every major decision,” a senior administration official said. “And it’s safe to say that whatever other activity might have been under way was no exception to that rule.”

But the good luck did not last. In the summer of 2010, shortly after a new variant of the worm had been sent into Natanz, it became clear that the worm, which was never supposed to leave the Natanz machines, had broken free, like a zoo animal that found the keys to the cage. It fell to Mr. Panetta and two other crucial players in Olympic Games — General Cartwright, the vice chairman of the Joint Chiefs of Staff, and Michael J. Morell, the deputy director of the C.I.A. — to break the news to Mr. Obama and Mr. Biden.

An error in the code, they said, had led it to spread to an engineer’s computer when it was hooked up to the centrifuges. When the engineer left Natanz and connected the computer to the Internet, the American- and Israeli-made bug failed to recognize that its environment had changed. It began replicating itself all around the world. Suddenly, the code was exposed, though its intent would not be clear, at least to ordinary computer users.

“We think there was a modification done by the Israelis,” one of the briefers told the president, “and we don’t know if we were part of that activity.”

Mr. Obama, according to officials in the room, asked a series of questions, fearful that the code could do damage outside the plant. The answers came back in hedged terms. Mr. Biden fumed. “It’s got to be the Israelis,” he said. “They went too far.”

In fact, both the Israelis and the Americans had been aiming for a particular part of the centrifuge plant, a critical area whose loss, they had concluded, would set the Iranians back considerably. It is unclear who introduced the programming error.

The question facing Mr. Obama was whether the rest of Olympic Games was in jeopardy, now that a variant of the bug was replicating itself “in the wild,” where computer security experts can dissect it and figure out its purpose.

“I don’t think we have enough information,” Mr. Obama told the group that day, according to the officials. But in the meantime, he ordered that the cyberattacks continue. They were his best hope of disrupting the Iranian nuclear program unless economic sanctions began to bite harder and reduced Iran’s oil revenues.

Within a week, another version of the bug brought down just under 1,000 centrifuges. Olympic Games was still on.

A Weapon’s Uncertain Future

American cyberattacks are not limited to Iran, but the focus of attention, as one administration official put it, “has been overwhelmingly on one country.” There is no reason to believe that will remain the case for long. Some officials question why the same techniques have not been used more aggressively against North Korea. Others see chances to disrupt Chinese military plans, forces in Syria on the way to suppress the uprising there, and Qaeda operations around the world. “We’ve considered a lot more attacks than we have gone ahead with,” one former intelligence official said.

Mr. Obama has repeatedly told his aides that there are risks to using — and particularly to overusing — the weapon. In fact, no country’s infrastructure is more dependent on computer systems, and thus more vulnerable to attack, than that of the United States. It is only a matter of time, most experts believe, before it becomes the target of the same kind of weapon that the Americans have used, secretly, against Iran.

This article is adapted from “Confront and Conceal: Obama’s Secret Wars and Surprising Use of American Power,” to be published by Crown on Tuesday.
https://www.nytimes.com/2012/06/01/w...inst-iran.html





Powerful "Flame" Cyber Weapon Found in Middle East
Jim Finkle

Security experts have discovered a new data-stealing virus dubbed Flame they say has lurked inside thousands of computers across the Middle East for as long as five years as part of a sophisticated cyber warfare campaign.

It is the most complex piece of malicious software discovered to date, said Kaspersky Lab security senior researcher Roel Schouwenberg, whose company discovered the virus. The results of the Lab's work were made available on Monday.

Schouwenberg said he did not know who built Flame.

If the Lab's analysis is correct, Flame could be the third major cyber weapon uncovered after the Stuxnet virus that attacked Iran's nuclear program in 2010, and its data-stealing cousin Duqu, named after the Star Wars villain.

The discovery by one of the world's largest makers of anti-virus software will likely fuel speculation that nations have already secretly deployed other cyber weapons.

"If Flame went on undiscovered for five years, the only logical conclusion is that there are other operations ongoing that we don't know about," Schouwenberg said in an interview.

The Moscow-based company is controlled by Russian malware researcher Eugene Kaspersky, and gained notoriety in cyber weapons research after solving several mysteries surrounding Stuxnet and Duqu.

Researchers at Kaspersky said they were only starting to understand how Flame works because it is so complex. The full significance will not be known until other cyber security firms obtain samples of Flame.

The Lab's research shows the largest number of infected machines are in Iran, followed by the Israel/Palestine region, then Sudan and Syria.

COMPLEX VIRUS

The virus contains about 20 times as much code as Stuxnet, which attacked an Iranian uranium enrichment facility, causing centrifuges to fail. It has about 100 times as much code as a typical virus designed to steal financial information, Schouwenberg said.

Flame can gather data files, remotely change settings on computers, turn on PC microphones to record conversations, take screen shots and log instant messaging chats.

He said there was evidence to suggest the code was commissioned by the same nation or nations that were behind Stuxnet and Duqu, which were built on a common platform.

Both Flame and Stuxnet appear to infect machines by exploiting the same flaw in the Windows operating system and employ a similar way of spreading.

That means the teams that built Stuxnet and Duqu might have had access to the same technology as the team that built Flame, he said.

Schouwenberg said he believed the attack was highly targeted, aimed mainly at businesses and academic institutions.

He estimated that no more than 5,000 personal computers around the world have been infected, including a handful in North America.

Kaspersky Lab discovered Flame while investigating reports that a virus dubbed Wiper was attacking computers in Iran.

The International Telecommunications Union, a U.N. agency that promotes research and cooperation on telecommunications technology, asked Kaspersky Lab to investigate those reports.

Schouwenberg said that his team discovered Flame, but failed to turn up anything that resembled Wiper.

(Reporting By Jim Finkle; editing by Edward Tobin and Ron Popeski)
http://www.reuters.com/article/2012/...84R0E420120528





Top 374 Keywords the U.S. Government Monitors
Zack Whittaker

Summary: Three months on, the media mill continues to grind after EPIC releases a four-page list of words the U.S. government monitors social media for.

Three months ago, a list of keywords was released by the Dept. for Homeland Security after the Electronic Privacy Information Center (EPIC) sued the government for withholding the document.

The story has stirred up again by a couple of recent media reports have gotten the social networks sharing the media reports like wildfire.

This got me thinking.

The U.S. government may not be monitoring everything you say on social media sites, it monitors hundreds of seemingly obvious keywords every minute of the day — and some that are just plain bizarre.

The 39-page “2011 Analyst’s Desktop Binder“, emblazoned with the Homeland Security seal, dedicates four pages to words ranging from weather terms and cyber security to “south-west border” words and health related terms.

As we head into the summer season, you may want to think twice before tweeting about barbeque ”pork” or how the “cloud” is ruining the weather — a thoughtless comment that could end up with your Twitter account being monitored.

SmartPlanet readers: God forbid you should retweet anything written about “grids” as that term included on the list. Going to the “airport”? Or late getting there because of traffic “delays”? Gotten so angry you tweeted you were going to blow it up? (Well, that last one actually happened.) The rest are all on there.

While statistically the chances of those two words are unlikely, the chance of a genuine suspected criminal actively saying on any online forum: “Let’s get the cocaine and heroin in El Paso“. It’s comical to think that in a day and age of increased surveillance, anyone would be stupid enough to tweet or privately share their criminal activity online.

That said, two teenagers who were set to “destroy America” — a common term to refer to partying hard — were deported back to the U.K. after their rogue tweet set off alarms at Homeland Security.

Interestingly, some of the words you might expect to find are not on the list. While “China” is mentioned, the term is written in English. However, considering the tensions between Tibet and China, for instance — རྒྱ་ནག — “China” in Tibetan — should be monitored closer than the thousands of people retweeting a post about the country, or mentioning their seemingly unimportant vacation plans.

Twitter has 140 million users and more than 340 million daily tweets. If Twitter is the only social network monitored by Homeland Security — though it likely isn’t — the unit must use vast amounts of data processing power to monitor millions of tweets that flag up certain keywords.

It likely has more data-sifting capabilities than those Twitter leverages for its own analytics.

What the government then does with the data again is unclear. Though, we can all but bet it doesn’t print it out and stick it on the communal refrigerator for everyone else to see the good hard work of the junior staff.

As per an Associated Press report in November, the Central Intelligence Agency (CIA) now monitors more than five million tweets a day with the capability to monitor both Facebook and Twitter.

Sister site CNET reported last week that the FBI has formed a new unit tasked with developing new electronic surveillance technologies, such as the ability to intercept Web, wireless, and VoIP traffic. It adds yet another U.S. government department — including the CIA, the NSA, and Homeland Security — with the ability to monitoring online activity.

From the few media reports that have covered the story, already the retweets and the combination of words have flooded the microblogging site rendering the document vastly useless.

It’s unclear how a “flagged” social media update then connects to an action. It’s unlikely that a seemingly inane tweet will lead to a teenager’s basement front door will get busted in an armed FBI raid. Although, the chances are the flags at Langley are going crazy with today’s tweets.

According to a Homeland Security spokesperson, speaking to the Huffington Post: “DHS will review the language contained in all materials to clearly and accurately convey the parameters and intention of the program.”
https://www.zdnet.com/blog/btl/top-3...monitors/78417





FBI: New Internet Addresses Could Hinder Police Investigations

As the Internet prepares to celebrate World IPv6 Day next week, law enforcement is worried the transition could hinder legitimate investigations. Some tech companies agree it's a concern.
Declan McCullagh

The FBI is worried that an explosion of new Internet numeric addresses scheduled to begin next week may hinder its ability to conduct electronic investigations.

A historic switchover that will give the Internet a nearly inexhaustible supply of network addresses -- up from the current nearly exhausted total of 4.3 billion -- is planned for next Wednesday. AT&T, Comcast, Facebook, Google, Cisco, and Microsoft are among the companies participating.

Side effects from the transition to Internet Protocol version 6, or IPv6, "could have a profound effect on law enforcement," an FBI spokesman told CNET. "Additional tools" may need to be developed to conduct Internet investigations in the future, the spokesman said.

That's one reason the FBI recently formed a new unit, the Domestic Communications Assistance Center in Quantico, Va., which is responsible for devising ways to keep up with "emerging" technologies. CNET was the first to report on the formation of the center in an article last week.

While Wednesday's World IPv6 Day is only one step in the transition to the next-generation system, it's expected to mark the beginning of a gradual decline in popularity of the outgoing IPv4 standard. The participating Internet providers will begin to switch over a fraction of their residential subscribers on Wednesday, and router makers will enable IPv6 by default for their products. (Here's an IPv6 FAQ.)

That's what worries the FBI, which has been meeting quietly with Internet companies to figure out how its agents can maintain their ability to obtain customer records in investigations.

"This is a very real concern," says Jason Fesler, Yahoo's IPv6 evangelist. It will "impact a service provider's ability to readily respond to legal requests from law enforcement agencies," according to the Broadband Internet Technical Advisory Group, or BITAG, which counts AT&T, Cisco, Comcast, Time Warner Cable, Google, and Microsoft as members.

D-Link, the Taiwan-based company that's one of the largest makers of routers and networking gear worldwide, agrees. "D-Link is aware of potential issues concerning IPv6 and law enforcement concerns that are currently being assessed," a company spokesman said. "D-Link is committed to IPv6 support and will comply with any future guidelines."

The Internet engineers who recognized the need for more addresses as far back as the 1980s, and began sketching out what became IPv6 over two decades ago, didn't intend to create headaches for police agencies. Instead, it was an unintended consequence of the hybrid technologies that were created to allow IPv4 and IPv6 connections to share one network during the transition.

Once IPv6 is near-universally adopted, it's likely to prove a boon to police, a fact that some law enforcement representatives privately acknowledge. That's because each device -- tablets, phones, refrigerators, lawn-mowing robots, and so on -- will sport its own unique Internet address.

So far, the FBI is taking a wait-and-see approach to the transition, saying that "it is too early to know the extent of the impact of IPv6 upon law enforcement until more providers deploy it."

The bureau's concern about IPv6 is one component of what it calls the "Going Dark" problem, meaning that the surveillance capabilities of police may diminish as technology advances. CNET was the first to report that the FBI is asking Internet companies not to oppose a controversial proposal crafted in response to Going Dark that would extend the Communications Assistance for Law Enforcement Act (CALEA) to the Web.

FBI's GCN problem: the technical details
At the moment, if someone suspected of committing a crime is posting about it on Facebook, for instance, police can obtain a court order to trace an IPv4 Internet address such as 64.30.224.26 back to a single household.

But the exhaustion of IPv4 addresses is prompting many Internet providers to embrace a transitional technology called carrier-grade Network Address Translation, or CGN, that allows a single Internet address to be shared by hundreds of homes, or even an entire town, at the same time. It's common to have 1,000 people share one Internet address.

That means it's no longer enough to know that someone's publicly visible address is 64.30.224.26.

Facebook and other Web sites that want to trace a network connection back to a person -- for their own anti-abuse purposes or to assist law enforcement -- will need to log the IP address and also what's known as the port number. (Port numbers, such as assigning one household the range 12000-12009, are how hundreds of households can share a single Internet address simultaneously.)

In addition, an Internet provider using CGN also will have to keep logs of which port numbers map to which customer.

"You will need more," Keith O'Brien, a Cisco distinguished engineer, told the High Technology Crime Investigation Association this month. O'Brien said increased use of CGN "will require more information to be gathered in order to accurately identify a subscriber."

O'Brien suggested to his audience that, when conducting investigations, they should ask Web sites for the Internet address address, the exact time, and the source and destination ports that were in use.

Fesler, Yahoo's IPv6 evangelist, said that in addition to storing IP addresses, his employer is now recording the source port from which its users are connecting. "Only with the combination of time, address, and source port, will any Internet service provider have any chance of checking their logs, and associating that information back to a specific subscriber," he said.

Last summer, engineers from AT&T, Yahoo, and Juniper Networks jointly published "Logging Recommendations for Internet-Facing Servers," which the Internet Engineering Steering Group approved as a best-practices document called RFC 6302. It recommends that anyone operating a Web server record the source port number of inbound connections down to the precise second "to support abuse mitigation or public safety requests."

One inevitable side effect of all this extra logging is the expense: detailed logs consume an extraordinary amount of storage.

CableLabs, a research and development organization founded by the cable industry that counts representatives of Comcast, Rogers Communications, and Time Warner Cable on its board, says the log size is immense. It estimates the average subscriber opens 33,000 connections per day, which means 1.8 petabytes per year per million subscribers just for logging.

But, says Chris Donley, CableLabs' project director for network protocols, there's a way to chop log sizes. It involves assigning port ranges in advance to specific Internet addresses, which will reduce log volumes in the range of 100,000- to one million-fold, he estimates.

Law enforcement representatives like the idea, Donley says. "It will make it easier for ISPs to respond to public safety requests without requiring onerous infrastructure on either the ISP or public safety part," he said. "We've been meeting with a number of public safety agencies roughly quarterly to discuss this approach."

Not all Internet providers are using CGN. Comcast, for instance, has taken a different approach using what's known as a "dual stack," meaning their customers' computers will run IPv4 and IPv6 simultaneously.

Increased logging can also lead to privacy concerns. "We have urged providers not to log information that they don't need for their own provision of services, even if someone else might want the information or they hypothesize that it might be valuable someday," says Seth Schoen, a senior staff technologist at the Electronic Frontier Foundation in San Francisco.

And mandatory logging -- required by an FBI-backed bill that a House of Representatives committee approved last year -- would be especially problematic for smaller Internet providers. "We couldn't retain records" even under the smaller data requirements of IPv4, says Brett Glass, owner of Lariat.net, a local Internet provider in Laramie, Wy. "There would be too much volume."

"There is no doubt that the wiretappers are being left behind and challenged," says one attorney who represents telecommunications providers. "It is just a question of whether you have an always-on storage of everyone's activity for law enforcement's benefit when the Federal Trade Commission is suing you for overcollection in other contexts, and less intrusive measures can be used."

Live IPv6 wiretaps
In theory, intercepting IPv6-only traffic isn't any different from intercepting IPv4 traffic. Readily available sniffing tools such as tcpdump, Ethereal, and Wireshark can decode IPv6 packets. In practice, however, some hurdles can arise.

CALEA: The 1994 law called CALEA resulted in industry standards requiring telecommunications companies to make their networks readily wiretappable by police. But those standards, including one element called CACmII (which stands for the awkwardly-titled phrase Content-Associated Communications Identifying Information), are incompatible with IPv6.

During a presentation at a networking conference last fall, AT&T researchers warned that "the standards are steps behind the industry evolution" to IPv6.

Encryption: Any computer with IPv6 has built-in encryption called IPsec (which can also be available with IPv4). The New York Times reported in 2010 that the FBI was lobbying for a law requring telecommunications companies offering encryption to build in backdoors for law enforcement, a requirement that would likely cover IPsec, but the bureau distanced itself from that idea a few months later.

"The frequency of use should increase with IPv6," predicts a network engineer at Sonic.net, an Internet provider in Santa Rosa, Calif. "None of this is good news for law enforcement organizations."

But some of the technical details are challenging, and IPsec is still not widely used. Neither are HTTPS encrypted connections; Arbor Networks estimates that only 2 percent of native IPv6 traffic is HTTPS, not counting file sharing traffic.

Tunneling: A technology called Dual-Stack Lite, or DS-Lite, is designed to help with the transition by wrapping an IPv6 packet around an IPv4 packet, which can be faster than other methods.

It, too, can cause problems with wiretaps. An Internet draft published in March by representatives of Telecom Italia and France Telecom acknowledges DS-Lite can hinder eavesdropping. "A single IPv4 address, or some range of ports for each address, might be set aside for monitoring purposes to simplify such procedures," they recommend.

The FBI says it's paying close attention to these aspects of IPv6: "Some of the optional capabilities will determine whether existing law enforcement tools and techniques will continue to support lawfully authorized collections or additional tools will need to be developed."
http://news.cnet.com/8301-1009_3-574...nvestigations/





UK ‘Cookie Law’ Takes Effect: What You Need to Know
Zack Whittaker

Summary: Let’s be honest: The U.K. has made a right hash-up of implementing the cookie law from start to finish. It came into force on May 26. Here’s everything you need to know.

If you’ve seen a “cookie settings” warning like this recently, you’re not the only one.

A few high-profile U.K. websites have in the past few days started to warn its visitors that it uses cookies on their sites.

If this is the first you’ve heard about it and you own a U.K. website that uses cookies — such as those with shopping carts, adverts, a login function, or text-size preferences — or develop for a mobile application platform… whoops.

You had until today to comply with the new European cookie law.

You won’t be the only one, though. It is thought the majority of U.K. websites are breaking the law that dictates how users’ are tracked and logged, despite having more than a year to prepare for the changes.

Here’s what you need to know.

What’s the lowdown: E.U. cookie law or U.K. cookie law?

The E.U.’s “e-Privacy” Directive, which first came into force in 2002, was amended in 2009. Each of the E.U.’s 27 member states were told to bring the Directive into their own member state’s law by this time last year, including the United Kingdom.

The U.K.’s amended Privacy and Electronic Communication Regulations (PECR) Act 2011 was brought into force on May 26, 2011. The law stated, amongst other things, that companies operating in the E.U. and the U.K. must obtain the consent from its website users.

Cookies allow websites to offer a more personalised experience, such as remembering a user’s preferences. Cookies can also be used for tracking user behaviour, and also by website owners to track how often their pages are being visited and other interesting non-personal user information.

Some major websites, such as the BBC, have implemented new systems to inform users and allow them to opt-out. However, most U.K. government websites aren’t ready and already fall foul of the law.

The Directive dictates that users should be aware of which kind of cookie is being set, varying from “essential” cookies, such as those used to remember which goods are in your e-shopping cart, to “non-essential” cookies that can be used to track user behaviour.

But cookies are only a small part of online tracking, right?

Correct. The E.U. Directive contains only a portion relating to cookies, but also targets “non-essential tracking”, regardless of whether a cookie is involved or not.

Arguably it has distracted many from the wider implications of the Directive. Website and Web application operators need to determine whether third-party trackers — such as advertisers and analytics — are used on their sites.

As much as 40 percent of tracking activity is often not related to cookies, so a “cookie audit” should look outside other tracking technologies.

Why is the U.K. 12 months behind everyone else?

Only three countries actually met the deadline. Denmark and Estonia met the deadline, and the U.K. came close but probably got no more than a D+ for effort.

The U.K.’s data protection agency, the Information Commissioner’s Office (ICO), gave U.K. companies a 12-month reprieve because many were not ready by the half way point in the ICO’s grace period.

The 12-month reprieve was given because many had to rip open the innards of their corporate websites and Web applications to work out where cookies were implemented and when they were set.

Define “consent”, exactly.

In the vast majority of cases, a pop-up or some kind of obvious box will appear on a website asking a user to tick a box and hit a button. This means a user will give explicit consent to the use of cookies and other tracking tools. Users will also be able to determine the level of cookie and tracking use on the site.

But there’s a problem. Only a few days before the May 26 deadline, the ICO updated its guidance to state that “implied consent” will suffice, seemingly going against the original European Directive. The ICO said that the continued use of a website or Web application would imply the user is consenting to the changes — shifting the responsibility of consent to the user rather than the website owner.

On a practical level, as an ordinary Web user, what are my likely options in accepting or declining cookies?

BT, which has more than 8 million U.K. broadband customers, may have one of the best cookie settings examples available.

In this example, it allows the user to pick between strictly necessary cookies that allow the site to simply work, functional cookies that restrict social sharing and behavioural tracking code, and targeting which allows full user tracking and the fullest possible experience.

Unfortunately, because all websites and Web applications are set out differently and vary in size and structure, there is no one-size-fits-all solution to every site.

Some websites will offer “implied consent” that gives no option except the choice to leave the site, while others will simply allow users to check a box and allow all non-essential cookies in.

I’m a U.S.-based company with a U.K. and E.U. presence. Am I affected?

U.S.-based companies with a presence in the European Union, no matter how small, are still liable to E.U. laws, regardless of whether your website or Web application is hosted in the E.U. or elsewhere. Mobile application developers are also subject to the E.U. laws (see below).

In this scenario, while your U.S. website and all other non-E.U. websites are not liable to this law, your dedicated pages for the U.K., Italy, France, Germany, and so on, are all affected. It’s just the U.K. has taken a little longer to get the wheels in motion.

What are the penalties for failing to comply?

At the moment: there aren’t any.

The ICO can normally issue massive fines if a company, organisation, or governmental body is in breach of the U.K.’s data protection or privacy laws. For the cookie law, the ICO said it has the power to fine up to £500,000 ($780,000), but said it wasn’t going to suddenly “launch a torrent of enforcement action.”

The regulator will instead keep its eyes peeled and continue to push for sites to become compliant — despite having a year to stand on the right side of the law. As long as companies are willing to make the changes and can prove they are making steps to become compliant, it’s likely the ICO will carry on with its softly-softly approach.

But I heard most U.K. government websites will miss the deadline?

How very ironic. Indeed, ZDNet UK reported that most U.K. government websites will not be compliant by May 26.

The Cabinet Office said it was “working to achieve compliance at the earliest possible date,” which is government speak for, “by the time the next election comes.” Again, the ICO is fully aware that compliance is not an overnight job, and some can work all year with no avail.

A ICO official said earlier this month that the U.K. data protection and privacy regulator may give organisations “years” to comply with the law.

“Some of the timescales don’t match the May 2011 to May 2012 deadline. We recognise that some of the people we speak to don’t have web development cycles that start just because the ICO has set a deadline,” said David Evans, an ICO senior policy manager.

I develop Android, iOS, Windows Mobile apps. Am I affected?

Indeed, you are. All downloadable apps from applications stores — such as Apple’s App Store, Google Play or the Windows Phone Marketplace — are subject to the new laws. The ICO said it would be examining the stores closely to ensure compliance.

This of course does not mean just cookies — it includes any in-built tracking code that would enable access to a user’s smartphone data.

“Apps are one of the items on our list,” warned David Smith, deputy commissioner for the ICO. “It’s quite clear that if someone is storing something on a device, or accessing information that is already stored on a device, one of the issues might be the form of consent when an app is downloaded.”

I heard the E.U. just ‘outlawed’ website analytics?

Not quite, and far from.

It’s true that if you use Google Analytics, or any other service that gives you basic numbers through to pretty graphs to show you how many people visit, when, and what they look at, you will be affected.

But the new law has to accommodate the fact that website tracking is extremely common and is all but impossible to outlaw. It’s therefore down to the website owner or Web application developer to inform its users that it wants to track you.

The ICO said it wants to “focus its regulatory efforts on the most intrusive cookies or where there is a clear privacy impact on individuals” which may or may not include cookies that count you as a visitor to its statistics. The ICO remains frustratingly vague in this area.

Two-thirds of cookies are for adverts, but ads keep the Web free?

It seems somewhat counter-intuitive for the European authorities to impose stricter rules on how online advertisements work because its those advertisements that keeps the Web vastly free.

Interestingly, the Financial Times report that more than two thirds of cookies are for ads. As you’ll imagine, this means that unless sites become complaint, the ads displayed on sites will be in breach of the law.

This very site is free. This site doesn’t charge you to view its articles or leave feedback. But it does install a whole bunch of cookies on this very device that you’re reading this article on. It also installs a whole boatload from third-party advertisers.

But one of the major concerns is if users fail to accept the cookies, many sites will not see you as a statistic nor will the website be allowed to display ads, leading to the website owner losing money.

What is the ICO doing to chase big companies over the cookie law?

The ICO is in the process of chasing around 50 large companies with a U.K. presence in a bid to set a good example, reports ZDNet UK.

The ICO said it had contacted Facebook, Google, Amazon, AOL, and Apple UK — including dozens more to ‘remind’ about compliance with the new law. It also includes major media websites, such as the BBC — which is now compliant, a BBC spokesperson said — along with other media organisations, such as Associated Newspapers Ltd., which owns the Metro and Daily Mail websites.
https://www.zdnet.com/blog/london/uk...d-to-know/4910





Apple to DOJ: Bite Me

The Justice Department may regret trying to make its e-book antitrust suit stick to Apple
Philip Elmer-DeWitt

I haven't had so much fun reading legal documents since the Watergate trials.

I loved U.S. v. Apple et al. for the juicy details: the 56 phone calls, the clandestine meetings in swank Manhattan eateries, the secret e-mails "double erased" to ensure they couldn't be traced.

But what makes Apple's (AAPL) response, filed Tuesday, such a great read is the clarity and precision with which it cuts the government's case to shreds.

At least as it applies to Apple.

In the space of six paragraphs the document characterizes the Justice Department's assertions as "absurd" and "fundamentally flawed," accuses the government of "ignoring inconvenient facts" and of siding with monopoly rather than competition.

The key paragraph:

The Government starts from the false premise that an eBooks "market" was characterized by "robust price competition" prior to Apple's entry. This ignores a simple and incontrovertible fact: before 2010, there was no real competition, there was only Amazon. At the time Apple entered the market, Amazon sold nearly nine out of every ten eBooks, and its power over price and product selection was nearly absolute. Apple's entry spurred tremendous growth in eBook titles, range and variety of offerings, sales, and improved quality of the eBook reading experience. This is evidence of a dynamic, competitive market. These inconvenient facts are ignored in the Complaint. Instead, the Government focuses on increased prices for a handful of titles. The Complaint does not allege that all eBook prices, or even most eBook prices, increased after Apple entered the market.

Apple's filing doesn't try to defend the five publishers the DOJ has accused of colluding to fix prices. In fact, it basically throws them under the bus, pointing out that if there was a price-fixing conspiracy among its co-defendants -- as alleged -- they kept it secret from Apple.

Meanwhile, the government's lawyers are going to have a hard time proving that Apple violated antitrust laws because the company's market share in the e-book business before the launch of the iPad was essentially zero.

They can't make a case against Apple for collusion because whatever the publishers may have said to one another, there's no evidence that Apple conspired with its competitors.

They can't even use as evidence the blunt quotes taken from the Steve Jobs biography because they are hearsay.

The one element of the government's case that seemed to give Apple's lawyers a hard time was the charge that the most-favored-nation provision Steve Jobs added at the last minute was "designed to protect Apple from having to compete on price at all, while still maintaining Apple's 30% margin."

In its response, Apple's legal team can't even bring itself to name the provision, referring to it repeatedly as MFN. But they manage to shoot some holes in the government's argument, pointing out, among other things, that the 30% cut Apple takes is hardly pure profit margin. It costs money to run the iBookstore, and while Apple doesn't claim to lose money on e-book sales, that's not where it gets the big bucks.

You can get the gist of Apple's filing in those first six introductory paragraphs. The rest is an item-by-item refutation of the government's case and a summary of Apple defenses, should it come to that.

The full document is available as a pdf here.
http://tech.fortune.cnn.com/2012/05/...o-doj-bite-me/





Technicolor Dissects IPhones in Hunt for Patent Payoff
Marie Mawad

Technicolor, an unprofitable French company that invented the process for color movies used in “The Wizard of Oz” and countless other classics, plans to cash in on its 40,000 video, audio and optics patents to turn its fortunes around. Photographer: Andrew Harrer/Bloomberg

When Apple Inc. (AAPL)’s next iPhone hits store shelves, Technicolor SA (TCH)’s engineers will rush to get the handset -- not to make calls or play games, but to rip it apart.

Technicolor, an unprofitable French company that invented the process for color movies used in “The Wizard of Oz” and countless other classics, plans to cash in on its 40,000 video, audio and optics patents to turn its fortunes around. The company has a team of 220 people dissecting every new smartphone and tablet from industry goliaths such as Apple, Samsung Electronics Co. (005930) and HTC Corp. (2498) for patent infringements.

“We usually send manufacturers a big file, with photos of the guts of their products, pointing to where they’ve been using our technology without paying for it,” said Beatrix de Russe, a lawyer and executive vice president of intellectual property at Technicolor. “Once those images have sunk in, we can start negotiating.”

Patents have become a technology industry battleground as mobile-phone, tablet and computer makers try to lure consumers with constant improvements to their video and sound. Technicolor, which made the first color movie 90 years ago, holds key patents in digital audio and video.

“Smartphones have become the focal point for lawsuits and licensing talks,” said Yves Gassot, who heads consulting firm Idate Digiworld. “It’s because the market is so huge and is growing so quickly. At the same time, the smartphone is where you’ll find all the cutting-edge technology jammed into one place.”

Motorola Deal

Google Inc. (GOOG), creator of the market-leading Android mobile- phone technology, this month completed the $12.5 billion takeover of Motorola Mobility Holdings Inc.’s mobile-phone business and its 17,000 patents. Equipment vendor Ericsson AB expects to increase revenue from its 27,000 patents, while rival Alcatel-Lucent SA (ALU) says it plans to generate several hundred million euros this year alone from its 29,000 rights.

Prompted by surging demand for patents that regulate functions such as sliding gestures on touchscreens or the rendering of graphics for games and applications, lawsuits over smartphone and tablet technology have been filed worldwide. Samsung and Apple have sued each other in the past year on four continents over patent-infringement claims related to mobile technology and design.

Waking Up

Though Technicolor signed its first licensing deal in the 1950’s, de Russe said, ‘it feels like the rest of the world has just woken up to why patents are interesting.’’

Technicolor has agreements with “all major manufacturers” and has also started talks with multiple vendors over new devices, she said, declining to give details on who the licensees are and who infringed patents in the past.

Patent licensing is the most profitable business of the company. The licensing division had a 76 percent operating profit margin last year, helped by 1,200 contracts with television, computer and handset makers. The company’s overall operating profit margin, based on continuing operations, stood at 14 percent. Licensing sales totaled 451 million euros, about 13 percent of total revenue.

Technicolor, which has been shifting business from outdated film processes to digital techniques and software for movie- making, helped with special effects for the Harry Potter film series. The Paris-based company has refinanced its debt, sold assets in declining movie-equipment units, closed factories and cut jobs during the past two years. For 2011, it posted a net loss of 323 million euros on sales of 3.5 billion euros, its fifth consecutive annual loss.

‘Dry Out’

Third Point LLC and Apollo Management Holdings, which together own 13.4 percent of Technicolor according to data compiled by Bloomberg, have been pushing for a sale of the company’s patent portfolio, Le Figaro newspaper reported April 19. Third Point and Apollo representatives declined to comment.

“If we start selling our patents, revenues will dry out,” de Russe said. “It’s a very short-term vision.”

In February, the company unveiled a three-year plan with a focus on expanding licensing programs to more devices and entering China, India and Brazil.

The market has started to react positively to Technicolor’s revamp. While Technicolor shares are down 68 percent in Paris trading from a year ago, they have risen 31 percent since January.
JPMorgan Offer

The stock yesterday surged 8.9 percent after investor Vector Capital Corp. offered to boost its holding from 0.6 percent to as much as 30 percent through a capital increase, competing with a similar May 3 offer from JPMorgan Chase & Co. (JPM) Shareholders are scheduled to choose one of the two deals on the June 20 annual general meeting.

JPMorgan has said it supports management’s patent strategy, which it calls “investing for growth.” Vector Capital said it would be a “committed partner in helping Technicolor execute its strategy.”

Technicolor added 0.1 percent to 1.53 euros in Paris today, giving the company a market value of 341 million euros.

While the patent licensing business is lucrative, it often takes time before a company can cash in. Patent negotiations often last between one and four years, de Russe said.

The company is currently fighting in U.S. courts with Taiwanese manufacturers over patents used in LCD computer monitors, after it filed a complaint with the International Trade Commission. The process was started after several years of failed discussions.

“We’ve got a reputation for charging reasonable licensing fees and preferring friendly negotiations,” de Russe said. “That doesn’t mean we don’t drag people to court from time to time.”
http://www.bloomberg.com/news/2012-0...nt-payoff.html





Netflix Agrees to Delete Data on Ex-Customers
Daniel Frankel

Turns out that nobody has to know about that copy of Bad Girls of Red Light District 6: The Extended Cut you rented from Netflix just over a year ago.

U.S. District Court papers filed Friday revealed greater detail as to how Netflix settled a class-action privacy lawsuit filed against it last year, accusing it of violating the Video Privacy Protection Act (VPPA). In short, Netflix agreed not to hold onto data showing which movies its former customers rented for as long as it has in the past.

In February, Netflix announced that it had settled the case for $9 million in restitution and attorney’s fees, but didn’t talk about any changes to its policies. But as a plaintiff’s motion filed Friday seeking preliminary approval of this settlement shows, Netflix agreed to strip out information about the titles its former customers rent from their basic identification profiles no more than one year after they leave the service.

The VPPA was signed into law in 1988 by then-President Ronald Reagan after a Washington, D.C. newspaper outed Supreme Court nominee Robert Bork’s Blockbuster rental history during his Congressional approval hearings.

As Friday’s plaintiff’s filing noted, a subsection of that law requires video operators to destroy rental-history data “as soon as practicable, but no later than one year from the date the information is no longer necessary for the purpose for which it was collected.”

The plaintiffs contend that, “Netflix’s ongoing maintenance of ‘digital dossiers’ on its subscribers — after canceling their subscriptions and beyond the point where Netflix still needs the information — constitutes a failure to ‘destroy as soon as practicable,’ in violation of the VPPA.”

Netflix declined further comment on the matter beyond its February SEC filing confirming the settlement.

Friday’s filing also revealed that, under terms of the agreement, Netflix will pay $6.75 million to various privacy organizations, while $2.25 million will go to the attorneys who filed the case.

The customers who’s privacy rights were allegedly transgressed? They’ll receive nothing more than total consciousness on their deathbed.

Both sides wish for Judge Edward Davila to approve the settlement by June 29.
http://paidcontent.org/2012/05/29/ne...-ex-customers/





Sector Snap: Hard Drive Makers Downgraded
AP

Shares of Seagate Technology PLC and Western Digital Corp. fell Tuesday after a Barclays analyst cut his ratings for the hard drive makers, predicting that weaker-than-expected demand will pressure their shares.

THE SPARK: Analyst Ben Reitzes lowered his ratings for both companies to "Equal Weight" from "Overweight," saying that tepid demand for PCs will stymie growth over the next several months.

THE BIG PICTURE: Shares of the hard drive makers had rebounded this year — Seagate's up 60 percent, while Western Digital gained 10.5 percent — as the market recovered from shortages stemming from the flooding of factories in Thailand last year.

But Reitzes said that it appears that makers of notebook computers are cutting production and PC makers are keeping their inventories in check, given the possibility that new models could be on the way.

That suggests there won't be as big a ramp-up in demand for hard drives, a PC component.

Meanwhile, competition for PCs from Apple Inc.'s iPad tablets, which don't use the hard drives, remains heavy.

THE ANALYSIS: Reitzes said in a note to investors that he was concerned about results in the quarters ending in September and December. He cut his earnings estimates for both companies' 2013 fiscal years.

He also cut his price target on Seagate to $29 from $36, and on Western Digital to $37 from $49.

THE SHARES: In late afternoon trading, shares of Ireland-based Seagate fell $1.10, or 4.2 percent, to $25.08. Over the past 52 weeks, the company's shares have traded between $9.05 and $32.55.

Shares of Irvine, Calif.-based Western Digital fell $1.06, or 3.1 percent, to $33.15. Over the past 12 months, Western Digital's shares have traded between $22.64 and $44.44.
https://www.nytimes.com/aponline/201...ctor-snap.html





'Men in Black 3' Takes Down 'Avengers' with $55M
David Germain

The suits have knocked off the superheroes at the box office.

Will Smith and Tommy Lee Jones' sequel "Men in Black 3" debuted as the No. 1 movie over Memorial Day weekend with $55 million domestically from Friday to Sunday.

That bumps Disney's "The Avengers" into second-place after three blockbuster weekends on top for the superhero sensation. "The Avengers" took in $37 million over the three days to push its domestic total to $514 million and become only the fourth movie ever to top half a billion dollars.

Distributor Sony estimates that by the end of the four-day holiday weekend Monday, "Men in Black 3" will have pulled in $70 million domestically and $202 million worldwide.

Universal's "Battleship" was No. 3 in its second weekend with $10.8 million, raising its domestic earnings to $44.3 million. Paramount's comedy "The Dictator" took in $9.6 million to finish fourth in its second weekend and lift its total to $41.5 million.
The Warner Bros. horror tale "Chernobyl Diaries" opened at No. 5 with $8 million.

"Men in Black 3" launched with a bit more cash than its two predecessors, which both had opening weekends of just above $50 million.

But the original "Men in Black" debuted in 1997 and "Men in Black II" premiered in 2002, when admission prices were much lower than today's. That means "Men in Black 3" sold fewer tickets than the previous installments.

"Men in Black 3" reunites Smith's Agent J and Jones' Agent K as they battle a new alien menace that travels four decades back in time to do away with the younger Agent K (Josh Brolin).

Among the movie's box-office highlights overseas were debuts of $19.5 million in China, $18.9 million in Russia, $8.5 million in South Korea and $8 million in Japan.

Distributor Disney estimates that "The Avengers" will take in $47.1 million for the four-day holiday weekend, lifting the film's domestic total to $523.8 million. That will put "The Avengers" within $10 million of "The Dark Knight," the No. 3 movie on the all-time revenue chart with $533.3 million domestically.

"The Avengers" will pass "The Dark Knight" in the coming week, leaving only two movies above it: "Avatar" at $760.5 million and "Titanic" at $658.5 million.

With $26.3 million overseas, "The Avengers" raised its international total to $781.6 million, and its worldwide revenues to just under $1.3 billion. "The Avengers" will soon overtake "Harry Potter and the Deathly Hallows: Part 2" at $1.33 billion to become the No. 3 film on the global revenue list, again behind "Avatar" at $2.8 billion and "Titanic" at $2.2 billion.

Overall domestic receipts for the four-day Memorial Day weekend will come in well behind last year's record of $276 million. Paul Dergarabedian, an analyst for box-office tracker Hollywood.com, estimated that four-day revenues this time will total $195 million to $200 million, about 30 percent below Memorial Day weekend a year ago, when "The Hangover Part II" delivered a $100 million-plus debut.

Hollywood remains on a record pace this year, with domestic revenue so far at $4.24 billion, up 12.5 percent over 2011 receipts, according to Hollywood.com.

But "The Avengers" and now "Men in Black 3" have been the only notable successes for the summer season so far, with big releases such as "Dark Shadows" and "Battleship" fizzling on the domestic front.

"We really need to get going if we don't want to have play catch-up every weekend through the summer," Dergarabedian said. "Some of these summer movies are just not doing the business people had hoped for in North America."
http://www.newstimes.com/news/articl...5M-3589116.php





In Italy, Technology Is Leading to a TV Transformation
Eric Pfanner

When Italians said good riddance to Silvio Berlusconi, it turned out that they were ready for more than just a political change. Since Mr. Berlusconi stepped down from his post as prime minister last year, returning to life as a media mogul, the digital era finally seems to have dawned in Italy.

Mr. Berlusconi’s television company, Mediaset, an analog-era powerhouse that continued to dominate the Italian media scene well into his 17-year sojourn in or near the prime minister’s villa, has suffered greatly since he left office for the third and presumably final time. Advertising has fallen, earnings have plunged and more Italians are tuning in to alternatives like Sky Italia, the satellite television broadcaster owned by Rupert Murdoch’s News Corporation.

Perhaps even more striking is the way Italians are turning to the Web. Italy remains well behind most other West European countries in the reach of the Internet, in part because of policies that Mr. Berlusconi pursued to protect his business empire, rivals and critics say. But the spirit of change in Rome, ushered in by Mr. Berlusconi’s successor, Mario Monti, seems to have awakened Italians to the potential of the Web to make a difference.

Last week, Internet campaigners for greater transparency in Italian government claimed a small victory when one house of Parliament, the Chamber of Deputies, delayed a scheduled vote on the membership of the Authority for Communications Guarantees, or Agcom, which regulates the media and telecommunications, including the Internet. In a break from the past, when members of such commissions were appointed via back-room deals, Gianfranco Fini, president of the chamber, announced that candidates would have to file résumés, so that their applications could be considered on merit.

“For the first time in Italian history, the party system has given up making appointments in the dark, with no official candidates, and has instead accepted the principle of transparency and competence in decision-making,” proclaimed the Open Media Coalition, a group that has been calling for more openness in the selection process for Agcom and other regulatory panels dealing with media issues. These include the data protection agency and the board of RAI, the Italian public broadcaster.

The push for more transparency in the regulatory process in Rome came as another Internet phenomenon, the blogger and comedian Beppe Grillo, was scoring his first big political successes. Candidates in Mr. Grillo’s Five Star Movement won mayoral elections last week in Parma and several smaller towns, riding a wave of Facebook- and Twitter-fueled anger over corruption and business as usual.

Criticism of the selection process had ranged far and wide. Frank La Rue, the United Nations special rapporteur on the promotion of freedom of expression, recently wrote to the government, asking it to carry out public consultations on the nominations.

The selection of the new media and telecommunications regulator has attracted such broad interest because it is seen as a test of how much power Mr. Berlusconi still wields behind the scenes. Rivals of Mediaset have long complained that when he was prime minister, regulators favored his company and another politically connected giant, Telecom Italia. Several rival telecommunications companies, including Vodafone Italia, FastWeb and Wind, boycotted a recent farewell speech by the current head of the regulatory panel, Corrado Calabrò, whose mandate expires in July.

Agcom’s decisions will play an important role in shaping Italian society in a post-Berlusconi era. Among other things, it is in charge of ensuring fair news media coverage of elections scheduled for next year. It will also oversee an auction of new digital television frequencies, measures to deal with Internet piracy and efforts to promote broadband penetration.

Until Mr. Fini announced the delay of the vote, there was widespread speculation in the Italian media that the favorite for the job of Agcom president was Roberto Viola, who now holds the top staff position at the commission, secretary general. Mr. Viola is seen as having the necessary credentials, but rivals of Mediaset are against naming him president because of his involvement in decisions that were seen as helping the company during the Berlusconi years.

Last year, Sky Italia, the biggest pay-television company in Italy, pulled out of a so-called beauty contest to award new digital television frequencies. The company complained that the Agcom staff had drawn up guidelines that ensured that Mediaset and RAI, which offer mostly free television, would win.

Rivals of Telecom Italia say the existing Agcom has permitted big increases in the fees that Telecom Italia charges them to gain access to its network, costing them hundreds of millions of euros. They argue that Italy’s low broadband penetration rate — in January 2011 there were 21.9 lines per 100 residents, compared with a European Union average of 26.5 connections, according to the union’s statistics agency — is attributable in part to Telecom Italia’s hold on the market.

“It seems obvious to question how it could not occur to Agcom President Corrado Calabrò, lamenting the low penetration of Internet in Italy, that perhaps those price increases undermined the growth of broadband in Italy,” FastWeb said in a statement.

Mediaset, Telecom Italia and Sky Italia declined to comment for this article.

Given the entrenched positions, and the close political allegiances, picking a candidate satisfactory to all sides will not be easy, analysts say.

“It’s very difficult to find someone with experience in the sector who is not pro or against Mediaset,” said Augusto Preta, general manager of ITMedia Consulting, a research firm in Rome.

Amid the Internet-driven push for greater openness in government, the job of Agcom president has attracted interest from political outsiders. Stefano Quintarelli, a technology entrepreneur who most recently served as the head of the digital operations of Il Sole 24 Ore, a business newspaper, has mounted an Internet campaign for the post, receiving more than 12,000 signatures to an online petition supporting his candidacy.

“I think I have a vision of the market, and the technical skills, that could be helpful at Agcom,” Mr. Quintarelli said. “I think my nomination could be an encouragement to the young people of Italy who believe in merit.”

Mr. Quintarelli’s candidacy was endorsed by the Internet Society of Italy, which said in a statement that “500 years ago he would have been one of the protagonists of the Italian Renaissance.”

Analysts say, however, that Mr. Quintarelli is a long-shot choice; despite the move toward greater openness, it is likely that the job will go to someone with better connections, even if it is not someone with links to Mr. Berlusconi.

Even before the process of forming a new Agcom began, there were signs that the regulatory environment could become more challenging for Mediaset. Mr. Monti’s government reversed plans this year to offer the digital TV frequencies free, deciding instead on an auction.

Business conditions have also turned against Mediaset. In a recessionary economy, many Italian media companies have suffered, but Mediaset has fared worse than some of its rivals, with domestic advertising sales falling 10 percent and net income down 85 percent in the first quarter. That is why analysts say Mr. Berlusconi, despite having bowed out of politics, is still following developments in Rome very closely, even if Italians have consigned him to their political history.

“It seems that television is the only subject that still interests him,” Mr. Preta said. “Mediaset is not doing well in the market. If he has no ability to influence Agcom he would be worse off.”

As the landscape changes, Italians are experiencing a long-awaited digital awakening.

“I think a lot of people don’t realize, given how bureaucratic Italy can be, that there are times when an entire market can change,” said a former Italian television executive who spoke on condition of anonymity because his current role included negotiations with policy makers. “We are going through one of these times now.”
https://www.nytimes.com/2012/05/28/b...formation.html





Networks Pull the Trigger on Dish, But They're Only Hurting Themselves
John Bergmayer

As anticipated in our blog post from the other day, major television networks have sued Dish over its "Hopper" DVR. Hopper records primetime TV and makes it easier to skip commercials on recorded shows.

While Dish is the primary object of the suits, ordinary viewers are also targets. Viewers already skip past commercials on recorded shows and since the invention of the remote control have muted or channel-flipped away from them. But the networks are claiming that if you don't watch commercials, you're breaking the law.

They're also arguing that Dish is breaking the law simply by selling a product that allows people to record TV and play it back without commercials. In essence, they are trying to re-litigate the principal that was established in the Supreme Court's landmark "Betamax" decision which held that VCRs are legal. Their position is that home recording technologies can't get any better than they've been since the basic DVR was invented in the 1990s. But the law does not require technological stagnation.

These suits are legally dubious for a number of reasons, not least because their only legal "hook" is the act of home recording itself. Since watching a recording without commercials is not creating a reproduction, a derivative work, or a public performance copyright law simply has nothing to say about it.

But apart from the legal technicalities the suits just make no tactical or strategic sense. Dish customers still see ads on live TV, and if the networks insist on subjecting viewers to commercials even on recorded programs they'll just start getting their content from online sources that already lack commercials. Networks make quite a bit of money from retransmission fees paid by cable TV and satellite operators like Dish and if they want to keep the subscription TV gravy train going, they should welcome attempts by Dish and others to make their services better and more responsive to what viewers actually want.

I've uploaded some of the legal filings over here.
http://www.publicknowledge.org/blog/...ish-theyre-onl





New Netflix iOS App Capitulates to Bandwidth Caps
Kevin Fitchard

Carriers like Verizon and AT&T are trying to convince Netflix to pay for the bandwidth its subscribers consume on their networks. Today Netflix delivered a rather oblique response. It’s giving its iPhone customers the option of turning off cellular access to Netflix completely and instead rely on old-fashioned Wi-Fi to deliver their movies and TV shows.

With more and more customers moving off carriers’ old unlimited data plans to tiered data buckets, streaming any reasonable quantity of video is all but impossible without incurring major overage charges. In its latest update to its iPhone and iPad apps, though, customers can toggle on and off 3G/4G connectivity. It may mean sacrificing Netflix access everywhere, but it could help them avoid rather unpleasant phone bills at the end of the month.

There are still a few unlimited options out there for iPhone users. You can stream to your heart’s content on Sprint’s 3G network. There are still millions of customers grandfathered into Verizon and AT&Ts’ old unlimited plans, but both operators have begun throttling back speeds once customers hit unspecified – and seemingly arbitrary – thresholds, making video streaming all but useless.

What’s more, Verizon is doing everything it can to coax, cajole and boot customers off their unlimited plans this summer. Unless the carriers firm up some kind of revenue sharing pact with Netflix – which Verizon may well be in the process of cementing – it looks like streaming movies is going to be primarily a Wi-Fi affair.
http://gigaom.com/mobile/new-netflix...andwidth-caps/





AT&T: Data-Only Plans Coming for Phones in 2 Years
Peter Svensson

The CEO of AT&T Inc. said Friday that cellphone plans that count only data usage are likely to come in the next two years. In such a scenario, phone calls and texts would be considered as just another form of data.

Randall Stephenson didn't say AT&T has such a plan in mind, but he suggested that someone in the industry will likely offer one.

"I'll be surprised if, in the next 24 months, we don't see people in the market place with data-only plans," Stephenson said at a Sanford Bernstein investor conference in New York. "I just think that's inevitable."

Analysts see such plans as a logical extension of trends in wireless technology. Smartphones with data service can already use it for Internet phone calls and texting through services such as Skype.

Phone calls are also taking a back seat to other things people do with their smartphones. AT&T has been recording a decline in the average number of minutes used per month.

However, phone companies still make most of their money from calling plans and texting, which use very little data. That means phone companies would want to compensate for the revenue fall-off somehow, perhaps by raising data prices.

The switch would be complicated by the fact that phone companies charge each other to connect calls to phone numbers. That's one reason calling plans are charged separately from data usage now. But at least in the U.S., connection fees are low, and phone companies could make up for the cost by raising their own fees. Connection fees for international calls are much higher.

AT&T has said that it wants to introduce wireless data plans that allow a subscriber to share a data allowance over several devices, such as a smartphone and a tablet computer. Another AT&T executive, wireless head Ralph De La Vega, has said these plans are close to being introduced.

Such plans also represent an opportunity for phone companies to add more data revenue, but they are a possible pitfall as well, as consumers will effectively be getting a discount compared with buying separate plans for their devices. Stephenson said AT&T is determined to make more money from the plans, not less.

When you have millions of devices such as tablets that lack cellular data plans, Stephenson said, "it seems to me it's a lift, not a deterioration" to get them connected.

Tablets such as the iPad are often available with cellular data modems, but the majority are used only on Wi-Fi.

AT&T has also floated the idea of letting websites or video services pay for the data used to access them, instead of having the data count toward the visitors' allowance. That idea, similar to "800" toll-free numbers for websites, is more controversial, as it would let deep-pocketed websites make themselves more attractive than startups.

Stephenson said he expects experimentation along those lines to begin in the next year. He didn't say if AT&T would be the one to do it, but he said Web content providers are already contacting the company about setting this up.

"It's not us going out and mandating this. The content guys are coming in asking for it," Stephenson said. "If you don't allow those kinds of models to flourish, you're going to inhibit the potential of these services."
http://www.google.com/hostednews/ap/... e8fb2a137a81c





Cutting all the Cords: The Feasibility of a 100% Mobile Lifestyle
Dan Rowinski

The cord-cutting revolution is growing. People are ditching their cables boxes in favor of streaming videos through their smartphones, tablets and services such as Roku and Apple TV. In reality though, these are not real cord cutters. They still pay bills to the cable companies that deliver broadband Internet access to their homes. That broadband is delivered… by cords. Is it truly possible to live an Internet-connected lifestyle and cut all of the cords?

I consider myself a cord cutter. I stopped paying for cable service and live my life through my Roku box, iPad and Android smartphone. The Roku delivers Netflix, Hulu Plus, Amazon video on demand and MLB.TV to my television. I can access most of those services through my iPad and Android, as well. Yet the Roku is powered through a Wi-Fi router that is delivered from a broadband connection from Comcast. The iPad is almost always on Wi-Fi when in the apartment. While I think of myself as a cord cutter, the cable company is still getting nearly $60 a month from me.

And Comcast still sends me these lovely fliers about once a month.

To be honest, it is enticing. For about $25 or so extra dollars a month, I can have cable and faster Internet, video on demand and I'd finally be able to watch Game Of Thrones on HBO. The cable company wants me back on cable, and I might be inclined to give in.

But what if I chose the alternate route and completely cut Comcast out of the equation? Like it or not, I still have to choose a service provider. Right now, I pay Comcast for my home Internet, Verizon for the data connection on my iPad and AT&T for my smartphone plan. To really cut all the cords, I am throwing myself straight into the arms of AT&T, Verizon and maybe even Sprint. Is this a move that I would be willing to make?

Here is how it would theoretically look.

In April, I used 140 GB of broadband data through Comcast. That is up from March (115 GB) and down from February (164 GB). Let’s say that on an average month, I am using about 120 GB of broadband data. That includes streaming video through the Roku, running music through Spotify for about eight hours a day through the iPad and my normal activities as a writer at ReadWriteWeb (running multiple browser tabs, uploading pictures, etc., as I work from home). In addition to the 120 GB of broadband data, I use between 500 MB and 1 GB of Verizon 3G data through my iPad and about 2.5 GB of AT&T LTE through my Android. So, for all my devices, let us call it about 125 GB of data used per month.

While 120 GB of broadband data might seem like a lot, for a cord cutter that does not watch any video media on cable, it is fairly reasonable. Comcast currently sets its data cap at 250 GB and soon may be going to a usage-based system and says that 99% of its users stay well under that cap.

But here is where the biggest problem is posed. For Comcast, delivering that 120 GB of data is simple. It has big, fat pipes and a sophisticated network to deliver Internet to the T1 connection to people’s homes (also known as “the last mile.”) To replace that data through pure wireless solutions will take creativity... and it will not be cheap.

The first thing to look at is turning my smartphone or tablet into a wireless hotspot. That way I could replace the Wi-Fi router without having to buy any extra equipment. While this would be the simplest option, it would also become problematic to run several data-driven devices at full speed at once. The answer then might be to get a separate wireless hotspot, such as a MiFi router that turns cellular data into a broadband connection over 3G or 4G.

If I am looking to completely replace that 120 GB of broadband data by this route, it becomes cost prohibitive very quickly. A look at the hotspot plans for the top three U.S. carriers:

AT&T: 5 GB per month: $50 ($10 per GB overage charges)
Cost to replace 120 GB: $1,200
Verizon: 10 GB per month: $80 ($10 per GB overage charges)
Cost to replace 120 GB: $1,180
Sprint: 12 GB per month: $79.99 ($0.05 per MB overage or $51.20 per GB)
Cost to replace 120 GB: $5,609.59

That is only half of the equation, though. The other half is performance. Wi-Fi is a great technology because it provides reliable speeds and can be split among several devices. Comcast delivers speeds in tiers, with about 15 Mbps running about $57. At this point, LTE devices can deliver faster performances in real-world conditions on a device-by-device basis. Realistic speeds of anywhere from 15 Mbps to 40 Mbps can be seen, depending on what region you are in and how many people are using the same LTE network. As more people start using LTE, those real-world speeds will start coming down as the network becomes more congested. The question will be how well will your devices perform through an LTE MiFi device or mobile hotspot from a tablet or a smartphone? When you rely on your laptop or desktop for work purposes, you are going to end up frustrated with your data connection more often than not.

How Much Does Mobile Displace the PC and TV?

Well, there is a very simple answer to all of this: Cut the cord entirely, stop streaming entertainment to your device, find Wi-Fi hotspots in public and only use data on your smartphone for basic purposes including Web browsing, search and social media. This is not hard to envision, millions of people do not have cable and hardly use their cellphones at all. The easiest way to cut the cord is to just not live by the rules of the cord. Same goes for the wireless carriers.

This brings us into an interesting discussion on “mobile-only” existences. The idea of mobile-only has been percolating for the past several years as people look to cut the cable cord and smartphone and tablet use has skyrocketed. Within the past several months, mobile-only has been a topic pushed to the forefront as people analyzed Facebook’s S-1 document the company filed for its initial public offering.

Facebook has a problem. It does not make any money off of mobile. At the same time, many of its users interact with the social platform primarily through mobile devices. It is not inconceivable that many or most of Facebook’s new users going forward will be mobile-only consumers. Much of that growth will be international in countries that do not have robust cable infrastructures, but it will also happen in the U.S. and Europe as people that do not need to work from laptops or desktops only use tablets and smartphones to interact with the Web.

Internet billionaire investor Mark Cuban poses these pertinent questions in a blog post breaking down Facebook’s IPO and the challenges the company faces with mobile-only consumers going forward:

“Which leads to a much broader question. Just what percentage of PC Online usage will mobile displace? Is it feasible that people will “cut the broadband cord” and live exclusively off of their mobile internet access? Why not use your mobile as an in home hotspot rather than paying for 2 internet connections? If you avoid streaming video and downloads its easy to stay within your caps. Do you know anyone that has cut their broadband access to go exclusively mobile internet?” Cuban wrote.

This, of course, is not just a question about Facebook. Mobile-first and mobile-only approaches by consumers are going to affect the entire technology industry going forward. Companies such as Comcast have to worry about people not just cutting their cable cords, but cutting broadband out of their lives entirely. Forget about replacing 120 GB of broadband data, Comcast might need to learn how to compete in the mobile space where high-end plans are between 5 GB and 10 GB.

The reality though, in the short term, is that most users in developed countries (especially the U.S.) are not going to be mobile-only. As it stands now, cord cutting represents one step in a digital lifestyle where classic cable gets cut out of the picture in favor of other alternatives. Moving down the spectrum is where we find the mobile-only users and right now those people are few and far between.
http://www.readwriteweb.com/mobile/2...style.php#more





Hotspot Shield Lets Your Android Surf Safely Over Public Wi-Fi
Kevin C. Tofel

Looking for a little safety and mobile privacy at that public hotspot? AnchorFree’s Hotspot Shield app might be worth the look for your smartphone: The company launched an Android version of the mobile app in Google Play on Thursday, complementing its iOS edition that was introduced last year. The software is a multi-purpose utility, combining VPN web browsing with anti-malware and broadband data compression.

Normally, I’m not a fan of security focused software; I generally find that if you’re smart about what you install and where you surf online, your risk of infection is fairly minimal. But given how open the Android Market is — apps aren’t under vigorous review — and a history of widespread malware apps hitting Android devices, I don’t think such solutions are a bad idea. And by combining other useful features, such as private browsing on public networks and reducing bandwidth, Hotspot Shield becomes a little more compelling.

There are two versions of Hotspot Shield: One free and one called “Elite”, which costs $1.99 per month or $19.99 for a year’s subscription. The free version offers unlimited VPN (virtual private network) browsing and protection from about a million known security threats, but to add the data compression and more widespread protection — roughly 3.5 million malware, phishing and spam threats – you’ll have to ante up the monthly or yearly fee. Owners of multiple Android devices only have to pay one time, which is nice. You can also get the Elite version for free by completing some advertising offers that earn credits towards the Elite price.

Again, I personally don’t buy into some of the security hype, but there’s no harm in cheap insurance. And HotSpot’s VPN service brings not only privacy and protection when surfing on a handset, but also can help get to sites or services that could be blocked on a network. Add in the data compression, which could hedge against potential data overage charges and Hotspot Shield sounds like a potent mobile combo.
http://gigaom.com/mobile/hotspot-shi...-public-wi-fi/





Kroes: I Will End Net Neutrality Waiting Game
Ben Woods

Europeans are a step closer to seeing new net neutrality rules put in place, after the release of an EU regulators' report on how often ISPs and operators throttle their services.

On Tuesday, digital agenda commissioner Neelie Kroes said the release of the report from by the Body of European Regulators for Electronic Communications (BEREC) means she will make recommendations to the EU on preserving net neutrality, which aims to make sure ISPs do not unfairly restrict customers from accessing the service or application or their choice.

"BEREC has today provided the data I was waiting for. For most Europeans, their internet access works well most of the time. But these findings show the need for more regulatory certainty and that there are enough problems to warrant strong and targeted action to safeguard consumers," Kroes said in a statement.

"Given that BEREC's findings highlight a problem of effective consumer choice, I will prepare recommendations to generate more real choices and end the net neutrality waiting game in Europe," she added.

A spokesman for Kroes told ZDNet UK on Tuesday that the recommendations will be put in front of the European Commission before the end of 2012, or very early in 2013.

Kroes has pushed for EU member states to hold off from introducing their own individual net neutrality laws, saying that legislating on an ad-hoc country-by-country basis would "slow down the creation of a Single Digital Market". She has asked them to wait until Breec published its report, which was commissioned more than a year ago.

In its report, BEREC reported that between 20 percent and 50 percent of people in the EU are tied into broadband or mobile broadband contracts that allow the operators to limit access to services like VoIP or file-sharing. In the UK, most of the major broadband providers, such as Virgin Media and BT, use throttling on some of their packages in order to manage traffic volumes.

Additionally, it found that 20 percent of fixed-service broadband operators do in fact apply restrictions to their services, such as for peer-to-peer use, at peak times.

However, Kroes noted that most mobile and fixed providers also offer plans that allow unrestricted access. While this implies customers have the choice of avoiding traffic management, this depends on whether providers explain the options clearly, she said.

"Are customers really empowered to choose well? Do they realise what they are signing up for? I didn't read all the pages in my mobile contract and I bet you didn't either! I believe we all need more transparent information," Kroes said.

Kroes is pushing for more detailed explanations of the "real-life" services that customers sign up for before they are locked into an agreement. For example, ISPs should provide detailed estimates of average speed at peak times, as well as out of hours, and should make it clear exactly which services people can use and at what times they are limited, where applicable.

"Consumers also need to know if they are getting Champagne or lesser sparkling wine. If it is not full internet, it shouldn't be marketed as such; perhaps it shouldn't be marketed as "internet" at all, at least not without any upfront qualification. Regulators should have that kind of control over how ISPs market the service," the commissioner said.

However, Kroes stopped short of saying she would force each operator to provide "full internet", so that there would be a difference between product packages and to encourage entrepreneurship in the sector.

"If consumers want to obtain discounts because they only plan to use limited online services, why stand in their way? And we don't want to create obstacles to entrepreneurs who want to provide tailored connected services or service bundles, whether it's for social networking, music, smart grids, e-health or whatever. But I want to be sure that these consumers are aware of what they are getting, and what they are missing," Kroes said.

She also said more guidance was needed over how consumers are informed about privacy, given operators are called on to use packet inspection to control access to services.
http://www.zdnet.co.uk/blogs/tech-te...game-10026293/





IP Traffic to Grow 29 Percent Per Year Through 2016: Cisco

Network equipment maker Cisco Systems Inc said Internet Protocol traffic is expected to grow at a compound annual rate of 29 percent in the next four years mainly due to strong demand for video and the prevalence of devices such as smartphones, tablets and chips that monitor energy consumption.

By 2016, annual global IP traffic is forecast to be 1.3 zettabytes - units of information - or 38 million DVDs per hour, Cisco said in its annual visual networking index forecast published on Wednesday that predicts growth from 2011 to 2016.

By comparison the traffic generated from 1984 to 2012 so far is 1.2 zettabytes, so the Internet traffic predicted for 2016 will be larger than for prior years combined, said Thomas Barnett, senior manager of Cisco's global service provider marketing group.

That is equivalent to 110 exabytes per month by 2016, up from about 31 exabytes per month in 2011, Cisco said.

Overall, IP traffic will grow at a compound annual growth rate (CAGR) of 29 percent from 2011 to 2016, according to the study.

Globally, video will account for 54 percent of all consumer Internet traffic in 2016, up from 51 percent in 2011, Cisco said, adding that business conferencing is expected to grow at an annual rate of 48 percent from 2011 to 2016.

It would take over 6 million years to watch the amount of video that will cross global IP networks each month in 2016, meaning that every second, 1.2 million minutes of video content will cross the network, Cisco said.

At the same time, the number of devices connected to IP networks is expected to reach 19 billion - nearly triple the global population in 2016, the study found.

IP traffic growth spells good news for Cisco, whose bread-and-butter business is routers and switches that manage Internet traffic.

(Reporting By Nicola Leske; Editing by Richard Chang)
http://www.reuters.com/article/2012/...84T0OA20120530





Exclusive: New Verizon FiOS Plans Coming June 17th, 300Mbps Service to Cost $204.99 Per Month
Dante D'Orazio

Verizon offered up quite the tease last week when it revealed that it was boosting speeds on its FiOS internet plans while refusing to detail how much it was going to charge for each tier. An anonymous Verizon employee has given us the answer, however, courtesy of a trove of training materials preparing the staff for the upcoming changes, which are set to go into effect on June 17th. The company's base 15 / 5Mbps internet service will now cost $64.99 per month with a two-year contract, compared to the $54.99 that's currently charged with a one-year deal. That $10 price bump isn't consistent across the board, however: both the new 50 / 25 plan (replacing the 25 / 25 option) and 150 / 65 plan (replacing the 50 / 20 option) cost the same their predecessors at $74.99 and $94.99 per month, respectively. Meanwhile, the new 75 / 35 tier slots in right between those two options at $84.99, and the 300 / 65 service that we're all dreaming about rings up at $204.99 per month — $5 more than the 150 / 35 ultimate plan it replaces.

Of course, this isn't quite an apples-to-apples comparison. The new rates are priced with a two-year contract (month-to-month plans cost $5 more), and if you don't have phone service there's an additional $5 surcharge on top of that. There's another fee hidden in there, too. If you're interested in getting the two top-speed plans, the documents say that most will need to pay $100 to have your equipment upgraded as part of a two to four hour service call. That fee won't apply if you sign a two-year commitment, if you're a new customer, or if you already have Verizon's current 150Mbps internet service. That's not all: if you're in a building that uses VDSL — a system that uses existing copper wiring in the building to deliver FiOS to apartments instead of new fiber optics — you'll be subject to the new prices but won't see a speed increase at all, as can be seen in the chart below.

It might seem odd that Verizon is increasing the prices of its lowest-speed plans while leaving the cost of many of its other plans unchanged, but it's a familiar tactic. For many users the increased speeds are likely more than they would ever need, and by raising the price of entry Verizon will likely see increased revenues. With the price changes all of its internet services are bunched up at over $50 per month with only $10 separating them. It's akin to the prices for popcorn at the movie theater — if you want any, you'll need to pay quite a bit, and then you can get twice as much for only a bit more. Still, we suspect the power users out there will be happy with Verizon's pricing for its high-speed plans — it looks like many of those users will see increased speeds without any change in price come June 17th.

Note: Verizon's current 3 / 1Mbps FiOS internet plan is only available as a step-up service for customers upgrading from the company's DSL plans, and we suspect the new package will be the same.
http://www.theverge.com/2012/6/2/305...internet-plans





ABB Fuels Data Centre Growth with DC Power
Caroline Copley

Swiss engineer ABB is targeting annual growth of 20-25 percent in the expanding data centre market by using more energy efficient direct current technology, the head of its Low Voltage Products said on Wednesday.

"DC is one of the highest growth industrial sectors for ABB to participate in," Tarak Mehta told a media conference in Baden, Switzerland. "If you walk around in the emerging markets there are more cell phones than people - that's a tremendous drive for computing horsepower," Mehta said.

Because DC technology makes fewer power conversions than AC and less equipment and space is needed, investment costs can also be lowered by 15 percent, ABB said.

Companies and technology giants are having to build enormous facilities housing servers which feed this increasing global addiction to data and multimedia.

This rapid adoption of cloud computing - where data and applications are stored on or hosted by remote computers via the Internet - is driving worldwide server demand.

But with one data centre consuming the same amount of energy as 25,000 U.S. households and carbon emissions from data centers expected to quadruple by 2020, there is pressure to make them more efficient, ABB said.

Using direct current power rather than traditional alternative current technology in its latest project for IT service provider Green in Lupfig, north central Switzerland, ABB has reduced energy consumption by 10 percent.

ABB said the DC production market is estimated to be worth up to $30 billion.

(Reporting by Caroline Copley; Editing by Mike Nesbit)
http://www.reuters.com/article/2012/...84T0NF20120530





As Apps Move Into Cars, So Do More Distractions
John R. Quain

THERE have been the sexy horsepower wars and dull best-in-class fuel-efficiency battles. Now automakers are fighting an undeclared, escalating war over in-dash apps, worrying regulators about even more distracted driving.

Automakers say they are concerned too, but that hasn’t stopped them from connecting smartphones to in-dash systems and putting Internet-based information into so-called connected cars for 2013. While some Web-based apps offer features similar to those already available in traditional car stereo systems, like the streaming music service Pandora, newer offerings will let drivers order movie tickets, scroll through restaurant reviews and even check Facebook updates.

Mercedes-Benz in its just-released second generation Mbrace2 system offers six apps, including Yelp, Google Local Search and Facebook, which will allow you only to check in. Acura, Honda and Subaru plan to introduce a suite of streaming services using Aha, a division of the telematics company Harman. Facebook will be included, and one of the services Aha will offer is the reading of Facebook posts aloud. Facebook is also in the new version of the Lexus Enform system, along with six other apps, including movie ticket ordering, restaurant listings and Yelp.

So in addition to navigating to a friend’s beach house, drivers with connected services and apps will be able to get recommendations for Thai restaurants near their destination, find the cheapest gas en route, check in on Facebook so friends know they’re on the way and switch to streaming Internet radio when the local FM station plays one too many Adele songs.

Carmakers say customers are demanding these features, driven by the popularity of touch-screen smartphones and tablets. Michael Deitz, Hyundai’s senior group manager for connected cars, says the company has attracted over 100,000 subscribers in less than a year for its Blue Link connected car service, which starts at $79 a year. Meanwhile, at the New York auto show in April, Don Butler, Cadillac’s vice president for marketing, played up the similarities between the company’s new touch-screen CUE system and Apple’s iPad.

“The majority of auto companies are reactive,” Robert Acker, Aha’s general manager, says of the apps arms race. “They see some announcement some other automaker made and they want to have the same services in their car.”

Government regulators are concerned. In February, the National Highway Traffic Safety Administration issued a 177-page set of proposed guidelines for in-car electronics. The report repeatedly mentions the complexity of dashboard displays and services that include Twitter posting in traffic, checking restaurant recommendations and buying tickets from behind the wheel.

Car manufacturers say the reality is that drivers are already using these features on their phones while driving. The goal, they argue, is to offer fewer distractions with built-in systems that use, for example, voice commands, buttons on the steering column and large touch screens.

“They are using these apps on their smartphones, anyway,” says Jim Buczkowski, Ford’s director of electrical and electronics systems. “So how can we enable them in a nondistracting way?” Getting drivers to put down their phones is the goal.

Car designers do extensive testing in simulators to determine how long it takes a driver to recognize an on-screen icon or instruction, understand a spoken command or recognize a warning alarm. However, when it comes to connected services, there are no established conventions. Some interfaces allow drivers to scroll through a list of items, others don’t. Some systems do not allow drivers to use touch screens, others emphasize them.

“We consider the size of text and the number of items per screen” in order to reduce the amount of time a driver may glance away from the road, said Sam Adams, cross car line services manager for Mercedes-Benz, which doesn’t use touch screens. Most systems also prevent drivers from using on-screen keyboards to enter addresses while the car is in motion, something automakers point out portable navigation devices and smartphones do not do.

The redesigned Lexus connected car system features a more legible 12.3-inch (measured diagonally) display and sophisticated voice recognition software.

“But we only allow one or two clicks, and the keyboard is locked out,” said Kevin Pratt, product education manager for Lexus. The company eschews touch screens, which it considers too distracting. Lexus instead uses a mouselike pointer on the center arm rest under the driver’s hand.

Still, this increased level of complexity is clearly causing concern for automakers. Lexus, for example, has technology specialists at its dealerships to assist new owners, and Mr. Pratt says he believes new buyers need about two hours to be shown the new features. At Cadillac, in spite of claims that the new touch-screen CUE system is a paragon of simplicity, the company is releasing an iPad app that mirrors the features of the in-dash system so drivers can get some training before climbing into the front seat.

But there is little consensus about how or what apps should be made accessible to drivers.

“We definitely screen new apps to make sure they are appropriate for a vehicle,” said Mr. Buczkowski of Ford. The company allows only apps that it has tested and approved, “but it’s a judgment call; we don’t have a formal filter for that,” he says.

Some companies like Aha handle such chores for the automaker, but “there isn’t a formal approval process” for adding additional content, Mr. Acker of Aha said.

Furthermore, the central tenet of such services is that they can be updated and changed by the automakers, a feature that wards off obsolescence. Even car companies that insist on building the software and services themselves, like Mercedes-Benz, say that what’s on the dash can be upgraded instantly. Mercedes can update its Mbrace2 apps over the air directly to the car, a trend other automakers are likely to follow.

“Imagine getting into your car and having a completely different experience,” Mr. Adams of Mercedes said.

The question remains, however, how quickly or even if drivers can safely adapt to such changes.

Jake Sigal, the founder and chief executive of Livio Radio, says any app that isn’t directly related to audio, safety or navigation is a distraction. Mr. Sigal, whose company aggregates streaming music services to be played over car stereo systems, also acknowledges that left to their own devices, drivers go to extremes, mounting their iPhones on the dashboard.

Many of the companies involved in connected car services worry that government regulators will step in to eliminate them. Indeed, N.H.T.S.A., in its February report, even regards navigation as interfering “inherently with a driver’s ability to safely control the vehicle.” The agency points out that 17 percent, or nearly 900,000, of police-reported accidents in the United States in 2010 were because of driver distraction.

Among the report’s recommendations is that any in-dash operation that requires the driver to look away from the road for more than two seconds be disabled. The agency also suggests banning manual text entry of more than six button or key presses during a single task and the use of more than 30 characters of text on a screen.

Some of the proposals are drawn from 2006 guidelines from the Alliance of Automobile Manufacturers, a trade group in Washington that represents 12 major automakers including Ford, General Motors and Mercedes-Benz.

But the N.H.T.S.A. proposals are only recommendations. The report points out that evidence of particular distractions is “not sufficient at this time to permit accurate estimation of the benefits and costs of a mandatory rule” regarding such a wide variety of connected car systems.

More important, the technology and services are changing so rapidly that any regulation would probably be obsolete by the time it became enforceable.

“It’s still the wild, wild West days,” Mr. Sigal said.
https://www.nytimes.com/2012/05/27/a...tractions.html





Lawsuit Shakes Foundation of a Man’s World of Tech
David Streitfeld

MEN invented the Internet. And not just any men. Men with pocket protectors. Men who idolized Mr. Spock and cried when Steve Jobs died. Nerds. Geeks. Give them their due. Without men, we would never know what our friends were doing five minutes ago.

But are these men trapped in the past even as they create the future?

That’s the debate that has sprung up here since Ellen Pao, a junior partner in her early 40s at the distinguished venture capital firm of Kleiner Perkins Caufield & Byers, filed a sexual discrimination lawsuit against the company and her colleagues there.

The complaint, laced with accusations of professional retaliation after spurned sexual advances, has riveted Silicon Valley, whose venture capitalists generally prefer media attention for their businesses and deals, not themselves. Instead of talking about the New New Thing, people are discussing an old, old problem. And they are taking sides.

Although the accusations have yet to be heard in court, even some of Ms. Pao’s critics concede that she is exposing an uncomfortable truth about Silicon Valley: starting tech companies in 2012 is still a male game, and so is funding them.

Her complaint goes further. It depicts venture capitalists here as a group of 21st-century men who may be hard at work building the 22nd century but, when it comes to dealing with women in the workplace, are stuck firmly in the caveman era — or at least in the 1950s. It’s a portrait that many women in tech find all too familiar.

“You talk to any woman in technology and she will have a personal story or know a story where she felt conscious of her gender in subtle or significant ways,” said Kathy Savitt, 48, the chief executive of the social commerce start-up Lockerz. Sometimes, she said, it’s as mild as realizing, “I’m the only chick in the room.” Other times, “it’s a lack of relevance, a feeling you can see an end to your opportunities.”

With the number of women in Silicon Valley so meager, a prominent discrimination lawsuit does not surprise Ms. Savitt. This place runs into trouble with women on a regular basis, most memorably in recent years when the C.E.O. of Hewlett-Packard resigned after inappropriate conduct with a former reality TV actress who was working for him.

Still, Ms. Pao’s lawsuit has injected talk of sexual politics into a conversation that generally sticks to money and eyeballs and business plans, monetization and enlightenment of the masses. Men in Silicon Valley may not behave any worse than men anywhere else, but people here like to think it’s all a meritocracy.

The shock really stems from where the scandal is taking place. Ms. Savitt knows Kleiner well; the firm is financing Lockerz. She cannot comment on the suit but expresses her deep admiration for the Kleiner crew. The firm is one of the few exceptions to the venture world’s disinterest in hiring women. A quarter of its 50 partners are female.

That fact fits awkwardly with the lawsuit’s claim that one male executive, Randy Komisar, told Ms. Pao that women would never succeed at Kleiner “because women are quiet.” Another male executive, Chi-Hua Chien, is quoted in the suit saying women were not being invited to a big-deal dinner because they would “kill the buzz.”

Neither Ms. Pao nor any of the parties mentioned in the lawsuit would comment on it.

Kleiner is an unlikely defendant for another reason. It is particularly conscious of its image. “As Kleiner Perkins sees it, the Florence of the Renaissance had the Medicis, the American steel industry had the House of Morgan, and Silicon Valley in the late 20th century has Kleiner Perkins,” David A. Kaplan wrote in “The Silicon Boys” in 1999.

That was when the firm was at its peak, the money behind Netscape, Genentech, Amazon and a little start-up called Google.

“If you believe every allegation in the complaint, it’s appalling and an important window into how the valley works,” Mr. Kaplan said. “But I’m somewhat skeptical. The clichés you hear in the valley are about the pranks, the obsessiveness, the Foosball tables. You don’t really hear about randiness and mistreatment of women. That doesn’t prove it’s not there, but that’s not the lore.”

Of course, it depends on your perspective. Sandy Kurtzig was one of two female engineering students in her class at Stanford in the late 1960s and is still in the game, with a start-up funded by Kleiner. She always tried to take the valley’s sexism in stride — “When men made passes, I just downplayed it so the guy doesn’t feel he’s being put down when rejected” — but is disappointed by its persistence.

“I am shocked there aren’t more women in high positions in Silicon Valley,” Ms. Kurtzig said. “I always thought the world was going to be gender-blind.”

KLEINER’S headquarters in an office park near here does everything possible to minimize the moment. A low-slung building that is obscured if not overwhelmed by vegetation, it looks like the home of a laid-back research center for the promotion of world peace. The parking lot has one Porsche, but otherwise Lexus is about as fancy as it gets. Venture capital wants to change the world without drawing attention to itself.

While Kleiner has seen its magic touch somewhat dimmed of late — it came very late to the money fountain that was Facebook — a lawsuit like this could permanently kill the buzz. Already, it has eclipsed the mid-May announcement of the firm’s 15th fund, a $525 million investment pot. Which, despite all those women at Kleiner, is being run by one woman and nine men.

Ms. Pao, who came to Kleiner with the dream of helping direct such a fund, graduated from Princeton with a degree in electrical engineering. She got a law degree from Harvard and worked for Cravath Swaine & Moore for two years doing international deals. She returned to Harvard for a business degree and worked for a variety of tech companies, including BEA Systems and Tellme Networks. Her geek cred is pretty unassailable.

In 2005, she came to Kleiner as a junior partner, working as chief of staff to John Doerr. He was one of the main evangelists who shaped the modern Internet, a geek’s geek who became a billionaire. But, unlike many here, money never seemed his primary goal.

Ms. Pao’s role was to help Mr. Doerr identify investments, interview executives and write speeches.

According to the suit, her troubles began almost immediately when another junior partner, Ajit Nazre, made inappropriate sexual advances. Eventually, the complaint says, Ms. Pao “succumbed to Mr. Nazre’s insistence on sexual relations on two or three occasions.” When she put an end to the relationship, it says, he “started a consistent pattern of retaliation against her.” This went on for five years, it contends.

The harassment part of the suit pales in comparison to the retaliation part, which blends into an allegation of a general effort to keep women in their place. Kleiner, Ms. Pao’s lawsuit says, discriminated against her and other women “by failing to promote them comparably to men, by compensating them less than men through lower salary, bonus and carried interest, by restricting the number of investments that women are allowed to make as compared to men.”

The firm, which has about 80 employees here with a handful more in China, is accused of failing to act when complaints of sexual harassment or discrimination were made. Ms. Pao says women are excluded from meetings and discussions. The firm fails to provide opportunities for visibility and success inside and outside the firm for women as compared with men, the complaint says.

Kleiner supporters have some questions, even if they do not necessarily wish to go on the record: Why did a talented woman stay for so long at a place that was treating her so poorly? Also, how is it that you can’t remember how many times you slept with someone who harassed you?

And how is it possible that Mr. Doerr never listened to her assertions of retaliation and discrimination? Mr. Doerr declined to comment, but his supporters have an answer. The first that anyone at the firm knew of her concerns, they say, was just five months ago — at which point Kleiner promptly brought in a lawyer to investigate. He found no basis to her complaints, the firm says.

If you take the Kleiner line, Mr. Nazre was less the instigator than the victim; he had a consensual affair with Ms. Pao and now is being portrayed as a harasser. The suit says he left the firm after the investigator’s report at the beginning of the year, implying a cause and effect. People inside Kleiner say he left of his own volition before the inquiry began.

Mr. Nazre has not surfaced since the lawsuit was filed. A voice-mail message box belonging to him was full late last week. He did not answer messages through his LinkedIn page, which says he still works at Kleiner.

Kleiner supporters said that the firm made repeated efforts to achieve a resolution, but that the parties could not come to terms. The lawsuit was filed in San Francisco Superior Court on May 10, but was not reported in the news media until two weeks later.

BOTH sides in the case are bringing out high-profile legal firepower. Ms. Pao is represented by the employment law specialist Alan B. Exelrod, who won a significant victory against the law firm of Baker & McKenzie in a harassment case. Kleiner is represented by Lynne C. Hermle, an equally celebrated employer defense lawyer. Ms. Hermle successfully defended I.B.M. in a case in which an employee said she was fired after complaining about sexual harassment.

Ms. Hermle has until June 13 to file a response to the accusations. “The complaint has no merit whatsoever,” she said. Mr. Exelrod declined to comment.

Ms. Pao is known to the small world of venture capitalists here. Her husband, Alphonse Fletcher Jr., whom she married after the physical relationship with Mr. Nazre ended, is not. But he is well known in New York and has become the object of considerable fascination in the tech world.

Mr. Fletcher, known as Buddy, has recently been in the news for suing the Dakota, the apartment building on Central Park West, for not letting him buy a fifth unit. Mr. Fletcher, a former president of the Dakota board, said he needed the new rooms, which adjoin his main apartment, to accommodate his growing family that includes not only Ms. Pao but also their young daughter.

Mr. Fletcher, who is black, is accusing the Dakota of racial discrimination and defamation. The Dakota responded to the suit by saying its concerns were not racial but financial: it did not think that Mr. Fletcher could afford another apartment.

An account of the suit in The New York Times noted that in 2003 and 2006, workmen on Mr. Fletcher’s Connecticut estate had accused him of sexual harassment. Mr. Fletcher denied the allegations, which were settled out of court. He declined to respond to a request for comment.

Before the marriage, Mr. Fletcher had lived at the Dakota with his longtime boyfriend, Hobart V. Fowlkes Jr.

“I must admit that I do not know Ellen as intimately as I obviously know Buddy,” Mr. Fowlkes wrote in an e-mail. “However, my interactions with Ellen have never been anything but positive.”

He added that he was “extremely touched” that they asked him to be the godfather of their daughter, “given the circumstances.”

FORGET about the Facebook I.P.O. For some entrepreneurial women, Ms. Pao’s lawsuit was the more significant event of the last month.

“When the news broke, we stopped what we were doing and were, like, ‘Whoa,’ ” said Claire Mazur, a founder of Of a Kind, an e-commerce start-up based in New York.

Ms. Mazur said she never had a problem getting meetings with venture capitalists. “But it’s definitely harder to talk to male investors who don’t have as much experience with retail and fashion,” she said. “That kind of personal connection can be key to getting funding.”

Or, as another e-commerce entrepreneur put it, “You’re trying to explain to a man why shopping is fun.”

Speaking only on the condition of anonymity — you never can tell whom you’re going to be asking for money — some entrepreneurs are more despairing.

One woman said she interviewed at a top venture firm in 2000 after coming out of business school. “I was told point-blank that they once had a woman and it didn’t work out,” she said. “That was 12 years ago and they haven’t had a single woman partner since.”

Kleiner, whatever its problems, actually hired women. So this executive worries that the message of the case to others will be: We were right to stick with the guys. She said she just got off the phone with a venture-backed chief executive who found out she was pregnant. The board was already moving to dump her.

The cold stats: Women make up just 9.1 percent of the board members of Silicon Valley companies, compared with 16 percent of Standard & Poor’s 500 companies, according to Spencer Stuart, the headhunting firm. The National Venture Capital Association estimates, based on a recent survey, that only about 11 percent of investing partners at venture firms are women.

The ratio is not much higher for the entrepreneurs these firms back. In 2009, only 11 percent of companies that received venture backing had a female C.E.O. or founder, according to Dow Jones VentureSource.

IT’S a retro state of affairs, although that isn’t stopping Silicon Valley from protecting its own, which means Kleiner. One Kleiner-backed woman said in an interview that she didn’t think much of Ms. Pao’s suit. “Anybody can sue anybody for anything, right?” Then she called back and said that she had now read the blogs and news articles about it, that the whole thing was a mess, that she was speaking out of ignorance and could she just stay out of it?

Few lawsuits like this make it to a jury, but Ms. Pao’s case might be an exception. And some on both sides want the case to go to trial. Any settlement by Kleiner could look like an acknowledgment of guilt. The firm, meanwhile, is playing as aggressive a defense as it dares, given the legal constraints.

Owen Thomas, a former Valleywag gossip columnist and a longtime Silicon Valley observer, saw the situation this way: “If a tenth of this is true, Kleiner Perkins has a problem.”

The women of the firm are certainly not united behind Ms. Pao. One of them, Beth Seidenberg, a general partner, took the unusual step of issuing a statement.

“I was drawn to the firm because of its diversity and have excelled here as have other women,” she said. “Everyone has an equal opportunity to succeed” at Kleiner. In an interview, she repeated those points.

Last week, Mr. Doerr posted a lengthy message on the firm’s Web site, saying Kleiner Perkins would “vigorously defend our reputation.” He did not mention his former aide by name. The next day, Kleiner announced that it was hiring a new female partner.

Christine Haughney and Jenna Wortham contributed reporting.
https://www.nytimes.com/2012/06/03/t...on-valley.html





Wasting Time Is New Divide in Digital Era
Matt Richtel

In the 1990s, the term “digital divide” emerged to describe technology’s haves and have-nots. It inspired many efforts to get the latest computing tools into the hands of all Americans, particularly low-income families.

Those efforts have indeed shrunk the divide. But they have created an unintended side effect, one that is surprising and troubling to researchers and policy makers and that the government now wants to fix.

As access to devices has spread, children in poorer families are spending considerably more time than children from more well-off families using their television and gadgets to watch shows and videos, play games and connect on social networking sites, studies show.

This growing time-wasting gap, policy makers and researchers say, is more a reflection of the ability of parents to monitor and limit how children use technology than of access to it.

“I’m not antitechnology at home, but it’s not a savior,” said Laura Robell, the principal at Elmhurst Community Prep, a public middle school in East Oakland, Calif., who has long doubted the value of putting a computer in every home without proper oversight.

“So often we have parents come up to us and say, ‘I have no idea how to monitor Facebook,’ ” she said.

The new divide is such a cause of concern for the Federal Communications Commission that it is considering a proposal to spend $200 million to create a digital literacy corps. This group of hundreds, even thousands, of trainers would fan out to schools and libraries to teach productive uses of computers for parents, students and job seekers.

Separately, the commission will help send digital literacy trainers this fall to organizations like the Boys and Girls Club, the League of United Latin American Citizens, and the National Association for the Advancement of Colored People. Some of the financial support for this program, part of a broader initiative called Connect2Compete, comes from private companies like Best Buy and Microsoft.

These efforts complement a handful of private and state projects aimed at paying for digital trainers to teach everything from basic keyboard use and word processing to how to apply for jobs online or use filters to block children from seeing online pornography.

“Digital literacy is so important,” said Julius Genachowski, chairman of the commission, adding that bridging the digital divide now also means “giving parents and students the tools and know-how to use technology for education and job-skills training.”

F.C.C. officials and other policy makers say they still want to get computing devices into the hands of every American. That gaps remains wide — according to the commission, about 65 percent of all Americans have broadband access at home, but that figure is 40 percent in households with less than $20,000 in annual income. Half of all Hispanics and 41 percent of African-American homes lack broadband.

But “access is not a panacea,” said Danah Boyd, a senior researcher at Microsoft. “Not only does it not solve problems, it mirrors and magnifies existing problems we’ve been ignoring.”

Like other researchers and policy makers, Ms. Boyd said the initial push to close the digital divide did not anticipate how computers would be used for entertainment.

“We failed to account for this ahead of the curve,” she said.

A study published in 2010 by the Kaiser Family Foundation found that children and teenagers whose parents do not have a college degree spent 90 minutes more per day exposed to media than children from higher socioeconomic families. In 1999, the difference was just 16 minutes.

The study found that children of parents who do not have a college degree spend 11.5 hours each day exposed to media from a variety of sources, including television, computer and other gadgets. That is an increase of 4 hours and 40 minutes per day since 1999.

Children of more educated parents, generally understood as a proxy for higher socioeconomic status, also largely use their devices for entertainment. In families in which a parent has a college education or an advanced degree, Kaiser found, children use 10 hours of multimedia a day, a 3.5-hour jump since 1999. (Kaiser double counts time spent multitasking. If a child spends an hour simultaneously watching TV and surfing the Internet, the researchers counted two hours.)

“Despite the educational potential of computers, the reality is that their use for education or meaningful content creation is minuscule compared to their use for pure entertainment,” said Vicky Rideout, author of the decade-long Kaiser study. “Instead of closing the achievement gap, they’re widening the time-wasting gap.”

Policy makers and researchers say the challenges are heightened for parents and children with fewer resources — the very people who were supposed to be helped by closing the digital divide.

The concerns are brought to life in families like those of Markiy Cook, a thoughtful 12-year-old in Oakland who loves technology.

At home, where money is tight, his family has two laptops, an Xbox 360 and a Nintendo Wii, and he has his own phone. He uses them mostly for Facebook, YouTube, texting and playing games.

He particularly likes playing them on the weekends.

“I stay up all night, until like 7 in the morning,” he said, laughing sheepishly. “It’s why I’m so tired on Monday.”

His grades are suffering. His grade-point average is barely over 1.0, putting him at the bottom of his class. He wants to be a biologist when he grows up, he said.

Markiy attends Elmhurst Community Prep, located in a rough area (the school has a tribute hanging in its hallway to a 15-year-old girl recently stabbed to death by the father of her baby). Thirty-five percent of the students, like Markiy, are black, and most of the rest are Hispanic.

Alejandro Zamora, 13, an eighth grader, calls himself “a Facebook freak.” His mother, Olivia Montesdeoca, said she liked the idea of him using the computer (until it recently broke) but did not have much luck getting him to use it for homework.

“He’d have a fit. He’d have a tantrum,” she said, adding that she really did not understand some of what he did online. “I have no idea about YouTube. I’ve never even heard of a webcam.”

Ms. Robell, the principal, said children needed to know how to use technology to compete, but her priorities for her students were more basic: “Breakfast, lunch and dinner.”

Many lower-income families take great pains to manage how their children use their devices.

In Boston, Amy and Randolph Ross, neither of them a college graduate — she works in a hospital and he at a bookstore — recently bought their twin 15-year-old girls laptop computers as a reward for good grades. The parents make sure the computers are used mostly for homework or for the girls to explore their interest as budding musicians.

“If you just buy the computer and don’t guide them on the computer, of course it’s going to be misused,” Ms. Ross said.

Her mother-in-law, Edna Ross, the matriarch of their African-American family who lives nearby in Dorchester, Mass., feels the same way. She got a new Hewlett-Packard computer last year through a project funded by the National Institutes of Health intended to provide both access and nine months of digital literacy training.

Edna Ross is strict about how her grandchildren use the computer when they visit. One of her grandsons once sneaked onto the computer and put a picture of himself on his Facebook page making an obscene gesture.

She told him if he could not control himself, he could not use the computer. Training, she said, is crucial.

“If you already have a child who feels like anything goes and you put a computer in his hand,” she said, “he’s going to do the first negative thing he can find to do when he gets on the computer.”
https://www.nytimes.com/2012/05/30/u...me-online.html

















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Jack Spratts' Week In Review is published every Friday. Submit letters, articles, press releases, comments, questions etc. in plain text English to jackspratts (at) lycos (dot) com. Submission deadlines are Thursdays @ 1400 UTC. Please include contact info. The right to publish all remarks is reserved.


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