Peer-To-Peer News - The Week In Review – June 26th, '04

[JackSpratts]

Quotes Of The Week

"It would help libraries achieve something that we haven't yet been able to achieve by ourselves, which is to place all of our publicly accessible digital library collections in a common pool." - Daniel Greenstein

"The RIAA's legal strategy is hopeless and smacks of short-sighted panic." - Felix Oberholzer-Gee

"What we've seen is there was an initial reaction and people are realizing there are other ways they can skirt around this tracking." - Mary Madden on continuing lawsuits













U.S. Senate Approves Antipiracy Bill

Peer-to-peer software vendors object
Grant Gross

The U.S. Senate has passed a bill allowing the U.S. Department of Justice (DOJ), in addition to copyright holders, to file civil lawsuits against alleged copyright pirates, over the objections of peer-to-peer (P-to-P) software vendors.

The Protecting Intellectual Rights Against Theft and Expropriation (PIRATE) Act of 2004, passed by voice vote Friday, would allow the DOJ to sue alleged copyright infringers, in addition to the civil lawsuits now brought by copyright holders such as the Recording Industry Association of America (RIAA). The PIRATE Act, sponsored by Senators Patrick Leahy, a Vermont Democrat, and Orrin Hatch, a Utah Republican, budgets $2 million for fiscal year 2005 toward DOJ civil lawsuits against copyright violators.

The bill, which has to be passed by the House and signed by President George Bush to become law, has drawn opposition from the Electronic Frontier Foundation (EFF) and other groups. "The PIRATE Act is yet another attempt to make taxpayers fund the misguided war on file sharing, and it's moving fast," the EFF's Web site says."It would also force the American public to pay the legal bills of foreign record companies ... Meanwhile, not a penny from the lawsuits goes to the artists."

The RIAA, in a statement Friday, praised the passage of the bill, which was introduced in March and moved to the Senate floor without a hearing. The Senate on Friday also passed the Artists' Rights and Theft Prevention Act, called the ART Act, which creates criminal penalties for videotaping movies in theaters and creates civil and criminal penalties for unauthorized distribution of commercial copyrighted works before they're released to the public.

"I commend the passage of these common sense proposals that offer flexibility in the enforcement against serious crimes that damage thousands of hardworking artists, songwriters and all those who help bring music to the public," Mitch Bainwol, RIAA chairman and chief executive officer, said in a statement. "These acts will provide federal prosecutors with the flexibility and discretion to bring copyright infringement cases that best correspond to the nature of the crime, and will assure that valuable works that are pirated before their public release date are protected."

P2P United, a trade group representing P-to-P software vendors, called for Congress to bring all stakeholders in the copyright debate together to solve the problem, instead of passing legislation like the PIRATE Act. The recording industry needs to find a way to turn the 60 million U.S. residents who have used file-sharing software into customers, instead of regarding them as criminals, said Adam Eisgrau, executive director of P2P United.

"The continued offloading onto the taxpayer of the cost of enforcing ever more draconian copyright penalties perpetrated by the PIRATE Act does nothing to compensate artists or copyright conglomerates for the peer-to-peer distribution of their work," Eisgrau said. "What it does do is force the Department of Justice into serving as free outside counsel for Hollywood and the recording industry in the same kind of private suits for damages that these conglomerates previously have been required to bring on their own dime."
http://www.infoworld.com/article/04/...Npiracy_1.html

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P2P Chief Blasts Hatch Proposal
Roy Mark

The peer-to-peer industry's most visible trade group blasted as "reprehensible" a new legislative proposal to allow P2P networks be sued for encouraging children and teenagers to commit copyright infringement.

Late Tuesday, Sen. Orrin Hatch (R-Utah) introduced the Inducing Infringement of Copyrights Act of 2004. According to Hatch, the bill permits persons or corporations to be held liable for infringing acts "that they intend to induce."

A longtime critic of the music file-sharing networks such as KaZaa and Morpheus, Hatch said in a statement, "Tragically, some corporations now seem to think that they can legally profit by inducing children to steal. Some think they can legally lure children into breaking the law with false promises of 'free music.'"

On Wednesday, Adam Eisgrau, executive director of P2P United, a file- sharing trade group representing Morpheus, Grokster, BearShare, eDonkey and Blubster, said Hatch's proposal creates a new crime that "trumps" 150 years of law and legal precedent, including a 2002 federal court decision ruling P2P software to be non-infringing.

In that case, which the music industry is appealing, the court found direct infringement of copyrighted works by some end users of P2P software but ruled the software also had significant non-infringing use. In clearing Morpheus and Grokster of copyright infringement, the court said the file- sharing companies couldn't control how people use their product.

"[The Hatch legislation] is ill-defined, ill-devised and is the product of an unbelievably flawed legislative process," Eisgrau said. "To do that in the dark of night with no hearings and no public discussion is reprehensible."

In his statement on the Senate floor Tuesday night, Hatch quoted the 2002 federal court decision that noted some P2P distributors "may have intentionally structured their businesses to avoid secondary liability for copyright infringement, while benefiting financially from the illicit draw of their wares."

Hatch added, "In other words, many P2P distributors may think that they can lawfully profit by inducing children to break the law and commit crimes. They are dead wrong. America punishes as criminals those who induce others to commit any criminal act, including copyright infringement."

Eisgrau said Hatch's bill could be interpreted that any developer of technology could be held liable for "merely inventing that technology" even when it has legal uses.

Eisgrau's comments to reporters came at the end of an abbreviated Senate Commerce hearing on P2P networks. Pending Senate floor votes limited the hearing to less than an hour. Although time was short, the session was long on fiery rhetoric and incendiary charges, particularly when Streamcast CEO Michael Weiss accused the music industry of "blacklisting" his company, which distributes the popular Morpheus P2P software.

As proof, Weiss produced a transcript of a voicemail message from Real Networks to Streamcast, which included the statement that "the labels have blacklisted you guys. So that is the problem we've got. Basically, what they're saying is you've got to denounce P2P, and/or resolve the lawsuit is what you have to do."

Weiss said he wants to the Senate Commerce Committee to direct the Federal Trade Commission or the Department of Justice to investigate the "apparently collusive, anti-competitive conduct in restraint of trade by the music industry."

John Rose, executive vice president of the EMI Group and EMI Music, denied any collusion between the music companies, but admitted EMI "will not license our work to P2P networks. We don't want to do business with them."

Rose was careful to distinguish between the P2P technology and the file- swapping networks that employ it.

"It's imperative that we distinguish behavior and technology when we look at organizations like Morpheus and Grokster," Rose said. "It's not necessarily the technology that's the problem, it's how the technology has been used and the business model that has been willfully and ruthlessly built around it."

Sen. Gordon Smith (R-Ore.) warned the warring parties, "I'd rather the industry deal with this problem, but if necessary, we'll do legislation."
http://www.internetnews.com/xSP/article.php/3372701


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Rat Out Taper, Get $500
Industry offering rewards for catching people camming films

The U.S. movie industry is enlisting theater employees to help combat piracy, offering a reward of up to $500 for every person they catch illegally recording films and report to the police.

The Anti-Camcording Rewards Program was unveiled Monday by the Motion Picture Assn. of America (MPAA), which represents the major studios, and the National Association of Theatre Owners (NATO).

Camcording has become a very potent source of piracy. A great majority of the films that show up on the Internet for download are a result of camcorders, according to MPAA spokesman Matt Grossman.

Typically, according to the MPAA, movies are filmed by camcorder during the first few days of their U.S. release, then distributed in digital form worldwide on file-sharing networks and other online outlets. Overseas labs then use the pirated films to create illegal DVDs, which are distributed en masse on street corners around the world.

In 2003, the MPAA seized 52 million discs worldwide with an estimated cost of $3.5 billion.

The MPAA is funding the program. The reward amount is up to the MPAA's discretion and is based on several factors, such as whether the suspect was apprehended and the timing of the piracy in relation to the movie's release.

"Theater employees are increasingly vigilant about individuals who surreptitiously set up camcorders in their theaters," NATO president John Fithian said. "This program will give every theater worker added incentive to take action against pirates and help protect our industry from this scourge."
http://edition.cnn.com/2004/SHOWBIZ/....piracy.reut/#


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Band Of Online Music Pirates Numbers In The Millions
Nicola Clark

PARIS - Not long ago, a friend recommended to Maria that she check out a new American electronic rock band, the Postal Service.

So she booted up Poisoned, her favorite file-sharing program, and had a look on the hard drives of millions of other people who, like her, were logged into a virtual swap meet of digital music files.

Once she found a few of the band's songs, in a few minutes they were stored away on the hard drive of her Apple iBook, ready to be played, copied to her iPod player or made available to countless other downloaders.

Maria, a 27-year-old Portuguese student living in Paris, estimated that she had copied about 300 songs this way over the past month - all without paying a cent for them. Her library of illegally downloaded tracks numbers in the region of 2,500, she said, but she does not consider herself a serious music pirate.

"I check around almost every day, although I don't always get something," Maria said. "It all depends on what's out there."

Aleix, 23, has been a regular music downloader since he moved to Paris from Barcelona two years ago. He has about 2,600 music files saved on his PC and sometimes downloads as many as 100 songs a week. Aleix declined to name his favorite file-sharing sites, most of them Spanish, for fear that they might be shut down.

"People learn about them through word of mouth," he said. "You can't find them if you search the name on Google, and if you do, that probably means it's going to disappear soon."

Maria and Aleix, who did not want their last names disclosed, are two of an estimated 7.4 million daily users of so-called peer-to-peer file-sharing networks worldwide who download a total of 410 million music files every day, compared with daily sales of CD albums and singles of just under five million units, according to Idate, a market researcher in Montpellier, France.

Last year, roughly 150 billion music files were transferred over these file-sharing networks, up nearly threefold from 55 billion in 2002. Western Europe accounts for about one-fourth of the total, Idate said, while the United States accounts for 43 percent.

Most file-sharing sites are compatible with one of five main networks - FasTrack, Gnutella, OpenNap, eDonkey and OpenFT - built around a specific family of free open source software that, when launched, connects the user's PC directly to other computers without relying on a central server, as Napster did before a music industry lawsuit shut it down in 2001.

Some programs, like Kazaa, BearShare and LimeWire, are developed by companies, many of them based in the United States, with legitimate online businesses who say they cannot police the kind of content their customers choose to download or make available to others. Others, like WinMX, Grokster and Gnucleus, were created by anonymous developer communities that exist only in cyberspace.

The overwhelming volume of music files available for free on the Internet is regularly cited by music industry executives as a primary reason for the sector's sharp downturn over the past four years.

In Germany, for example, where the incidence of online piracy is among the highest in Europe, recorded CD sales tumbled by 19 percent last year, the sixth consecutive year of decline, to 133 million. Meanwhile, sales of blank CDs used for "burning," or copying data such as music, stood at 325 million units. Sales of CD singles stood at 25 million, compared with an estimated 600 million songs downloaded over peer-to-peer networks.

Copyright and related protections apply in nearly every country. In 2001, the European Union extended protection for books, music and films to the Internet, although it gave member states significant leeway in its application. Individuals are permitted to make a limited number of copies for personal use, but this right does not extend to copyrighted material made available over file-sharing networks.

In late March, the music industry brought its battle against music pirates to Europe, targeting hundreds of "uploaders" - people who make large numbers of music files available to others via peer-to-peer networks.

As of June 9, IFPI, a London-based music trade body, said that more than 100 people in Denmark had been served with civil demand letters and that more than a dozen had agreed to pay damages averaging E3,000, or $3,600, each. A 23-year-old man from Cottbus, Germany, agreed this month to pay an E8,000 fine after police searched his computer and found 6,000 music files stored on it in MP3 format and 70 burned CDs. In Italy, criminal charges have been filed against at least 30 people since March after police seized computers and CDs containing about 50,000 music files.

More than half of music file-sharers are between the ages of 18 and 29. Most of them do their downloading either at home or, as in the United States, on university campuses. But as more households gain access to broadband services - 18 percent of Internet users in Germany, 32 percent in France and 25 percent in Britain, according to the market researcher GartnerG2 - downloading is becoming popular with older users as well.

"Today it is not rare that people of all ages and all social categories can be seen downloading over P2P," said Laurent Michaud, an analyst at Idate. "The software is free and very accessible. Anyone can learn to use it within a few minutes."

The record industry says its legal actions and the publicity surrounding them are having some effect. IFPI said that 7 out of 10 people in Britain, Denmark, France and Germany were now aware that file-sharing copyrighted music without permission was illegal, up slightly from 66 percent at the end of last year. Meanwhile, 59 percent of people polled in these countries said that criminal and civil action against file-sharers probably would be an effective deterrent to piracy, compared with 55 percent in December. The number of music files available on peer-to-peer networks also has fallen, to around 700 million today from 800 million in January and a billion in June 2003. But that still leaves a lot of unreformed song- swappers out there. Maria said she was skeptical that prosecuting a selected few Internet pirates would be effective. "It is hard to believe that is going to work," she said. "There are so many people doing it, and they can't go after everyone."
http://www.iht.com/articles/525731.html


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LaCie Bigger Disk

Four Drives in One Enclosure Equals Massive Capacity
Kristina De Nike

Even if you can't quite conceptualize how you could ever fill 1 terabyte (1,000GB) of disk space, the LaCie Bigger Disk will put that much capacity on your desktop in seconds. If you happen to know that you need 1TB to back up your network or complete your video-editing project, this drive provides it in one enclosure -- a new concept that has been very well executed.

The Bigger Disk can connect to your computer via FireWire 800, FireWire 400, or USB 2.0. The case holds four 250GB ATA/133 drives, but LaCie's custom firmware spans the four drives, so your Mac sees them as one volume. You can't see or format the individual drives, but you can partition the large volume.

Our tests revealed that the Bigger Disk's performance was equivalent to that of a single ATA FireWire 800 drive. The array writes to the first drive; when that drive is full, it moves on to the second, and so on until it has used up all four drives. The drive performed best when it was connected to our Power Mac G5 via FireWire 800. The array was around 30 percent faster on FireWire 800 than on FireWire 400. Over USB 2.0, the Bigger Disk was almost twice as slow as FireWire 400.

You can secure the drive in a locked box or use it to transport large projects, but at 11 pounds, this drive is not light -- and it's rather bulky. If you want to attach the drive to a server, you can buy a mounting kit for a 19-inch network rack from LaCie, for $78.

Macworld's Buying Advice

The Bigger Disk costs $1,199, which is approximately the same price as four 250GB FireWire 800 external drives. But if you need one huge volume to organize your data, the LaCie Bigger Disk is a clean, simple solution.
http://www.macworld.com/2004/05/revi...coebiggerdisk/


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Old Search Engine, the Library, Tries to Fit Into a Google World
Katie Hafner

Katarina Maxianova, who received her bachelor's degree in comparative literature from Columbia University in May, took a seminar last year in which the professor assigned two articles from New Left Review magazine. She found one immediately through Google; for the other, she had to trek to the library stacks.

"Everyone in class tried to get those articles online," she said, "and some people didn't even bother to go to the stacks when they couldn't Google them."

For the last few years, librarians have increasingly seen people use online search sites not to supplement research libraries but to replace them. Yet only recently have librarians stopped lamenting the trend and started working to close the gap between traditional scholarly research and the incomplete, often random results of a Google search.

"We can't pretend people will go back to walking into a library and talking to a reference librarian," said Kate Wittenberg, director of the Electronic Publishing Initiative at Columbia University.

Ms. Wittenberg's group recently finished a three-year study of research habits, including surveys of 1,233 students across the country, that concluded that electronic resources have become the main tool for information gathering, particularly among undergraduates.

"We have to respond to these new ways and figure out how to create the content that will be available," Ms. Wittenberg said, and come up with a way to make better research material available online.

That means working with commercial search engines like Google and Yahoo to make ever more digital-research materials searchable.

Undergraduates like Ms. Maxianova and her classmates are not the only ones conducting research from their computers. Faculty members also do it.

"One of the rarest things to find is a member of the faculty in the library stacks," said Paul Duguid, an information researcher who will teach a class this fall at the University of California, Berkeley on judging the authenticity of information found on the Web.

In the Columbia survey, 90 percent of the faculty members who responded said they used electronic resources in their research several times a week or more. Nearly all said it was a valuable resource.

While the accuracy of online information is notoriously uneven, the ubiquity of the Web means that a trip to the stacks is no longer the way most academic research begins.

"The nature of discovery is changing," said Joseph Janes, associate professor and chairman of library and information science at the University of Washington. "I think the digital revolution and the use of digital resources in general is really the beginning of a change in the way humanity thinks and presents itself."

A few research librarians say Google could eventually take on more of the role of a universal library.

"If you could use Google to just look across digital libraries, into any digital library collection, now that would be cool," said Daniel Greenstein, university librarian of the California Digital Library, the digital branch of the University of California library system.

"It would help libraries achieve something that we haven't yet been able to achieve by ourselves," Dr. Greenstein said, "which is to place all of our publicly accessible digital library collections in a common pool."

The biggest problem is that search engines like Google skim only the thinnest layers of information that has been digitized. Most have no access to the so-called deep Web, where information is contained in isolated databases like online library catalogs.

Search engines seek so-called static Web pages, which generally do not have search functions of their own. Information on the deep Web, on the other hand, comes to the surface only as the result of a database query from within a particular site.

Use Google, for instance, to research Upton Sinclair's 1934 campaign for governor of California, and you will miss an entire collection of pamphlets accessible only from the University of California at Los Angeles's archive of digitized campaign literature.

"Google searches an index at the first layers of any Web site it goes to, and as you delve beneath the surface, it starts to miss stuff," said Mr. Duguid, co-author of "The Social Life of Information." "When you go deeper, the number of pages just becomes absolutely mind-boggling."

Some estimates put the number of Web pages that are hidden from the view of most search engines at 500 billion.

Reference librarians are trying to bring material from the deep Web to the surface. In recent months, dozens of research libraries began working with Google and other search engines to help put their collections within reach of a broader public.

Carnegie-Mellon University, for instance, has digitally scanned 1.6 million pages of archival material from the papers of Carnegie-Mellon scientists like Herbert Simon, a Nobel Prize winner for economics and a computer chess expert. Now, a Google search for "Herbert Simon and Carnegie Mellon" turns up the Simon papers.

Google has also indexed two million book titles through the Online Computer Library Center, which manages a database of catalogs from 12,000 libraries around the world.

Other search sites are striking similar deals. Yahoo recently signed an agreement with the online library center to index its catalogs, and four months ago, it started carrying out a plan to make more of the deep Web reachable through Yahoo.

Yahoo has also signed agreements with the University of Michigan to make searchable the university's compendium of academic collections from more than 250 institutions. And it has indexed a digital repository at Northwestern University of more than 2,000 hours of Supreme Court oral arguments.

Yet for every archive that has become searchable by commercial Web engines, scores are not accessible. "There's lots of great stuff that isn't available digitally and likely never will be," Dr. Janes said. Most books published before 1995 fit into this category, he said, as do many older magazines, newspapers and journals, as well as historical maps, archives, letters, diaries, older census statistics and genealogical materials.

"We have to figure out how to adapt to a world where people will prefer digital stuff," Dr. Janes said, "yet not forgo the investment in print and analog collections and the work involved in mapping and maintaining those collections."

Research institutions are investing heavily in combining the new with the old. At Columbia's Butler Library, the stacks are not only alive and well, Ms. Wittenberg said, but have been modernized to allow for better physical access to the seven million volumes in the collection.

During the renovation, work areas with network connections were placed throughout the library.

"A student or faculty member could work for a whole day in what looks and feels like a very traditional library, while accessing either the print collection or the large and rapidly growing collection of electronic resources," Ms. Wittenberg said.

Many experts, even those who specialize in digital material, say that losing the tactile experience of books and relying too heavily on electronic resources is certain to exact a price.

"How do you know it's the appropriate universe from which to draw your research materials?" said Dr. Greenstein. "It has huge ramifications for the nature of instruction and scholarship."

At the same time, many research librarians say that the new reliance on electronic resources is making their role as guides to undiscovered material more important than ever.

Thomas Mann, a reference librarian in the main reading room of the Library of Congress, was reminded of this recently while helping a visitor who was researching a famine in Greece that occurred in 1942. A Google search had yielded little useful information.

"While he was looking at newspaper articles from the 1940's that we have digitized," Dr. Mann said, "I set up a search on the terminal next to him in another database of historical abstracts and history journals."

In less than a minute, he pulled up citations for five scholarly articles about the famine and helped the visitor put in requests for the paper copies from the stacks. "We can show people things they don't ask for," Dr. Mann said. "The historical database I got into hit it right on the button."

Some library experts welcome the change with few reservations.

"Although it seems like an apocalyptic change now, over time we'll see that young people will grow up using many ways of finding information," said Abby Smith, director of programs at the Council on Library and Information Resources, a nonprofit group in Washington.

"We'll see the current generation we accuse of doing research in their pajamas develop highly sophisticated searching strategies to find high quality information on the Web," Dr. Smith said. "It's this transition period we're in, when not all high-quality information is available on the Web — that's what we lament."

Dr. Janes said that, like many others, he occasionally pined for the days spent in musty library stacks, where one could chance upon scholarly gems by browsing the shelves.

"You can think of electronic research as a more impoverished experience," Dr. Janes said. "But in some ways it's a richer one, because you have so much more access to so much more information. The potential is there for this to be a real bonus to humanity, because we can see more and read more and do more with it. But it is going to be very different in lots of ways."
http://www.nytimes.com/2004/06/21/te...21LIBR.html?hp


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Florida to Tax Home Networks
Michelle Delio

Florida state officials are considering taxing home networks that have more than one computer, under a modified 1985 state law that was intended to tax the few businesses that used internal communication networks instead of the local telephone company.

Officials from Florida's Department of Revenue held a meeting on Tuesday to see whether the law would apply to wired households, and exactly who would be taxed. About 200 people attended, including community and business representatives.

In 1985 the state passed a law to tax businesses using their own communications networks, because otherwise the state could not collect tax revenue on the businesses' local telephone service. In 2001, that law was expanded to make "any system that is used for voice or data that connects multiple users with the use of switching or routing technology" taxable up to 16 percent.

The law is so broad that it would apply to networked computers, wireless services, two-way radios and even fax machines -- or "substitute communications systems," as the state calls them. The tax would be applicable (PDF) to the costs of operating such a substitute communications system, not to the purchase of the system's components.

In some cases, it appears the tax would be collected by the providers of communications services such as wireless companies or voice-over-IP firms. The tax would be added to the user's bill and then turned over to the Department of Revenue.

But some substitute communications services don't require a service plan. For those, the state could take the tax from the amount deducted on business, and perhaps personal, tax filings.

"According to my accountant, the way the law is written, if my tax filing includes deductions for the repair or maintenance of my two computer and one printer network, those costs will be subject to state communication taxes," said graphic artist Linda Kellman, who works from home. "Self-employed people get slammed with insane taxes everywhere, and I've sadly but grudgingly accepted that. But this tax, if they ever try to collect it, would be the last straw. Can I outsource my network to a more sensible state, do you think?"

Florida businesses and residents -- and even some officials in the Florida Department of Revenue -- agree that the wording of the law is too broad.

In May, the Florida Senate unanimously passed a bill that would have prevented collection of the tax until 2006, during which time the law could be carefully reviewed. The bill was then sent to the House, but wasn't voted on before the summer break, clearing the way for officials to begin collecting the tax.

As a result, the Florida Department of Revenue, which, according to local newspaper reports, was in favor of the bill to delay the collection of the tax, must now begin to address how the tax should be implemented.

"The tax language is so broad that virtually any communication technologies in your home or office could be subject to this tax," said Chris Hart, spokesman for ITFlorida, a not-for-profit industry organization for the state's technology professionals. "It's difficult to imagine a more anti-technology, anti-business tax. It directly attacks the efficient use of information technology."

Florida businesses aren't in favor of the tax.

It also could tax almost any Florida resident who uses any sort of modern communications technology, something that Florida's battalions of retirees on fixed incomes have just begun to become aware of, according to Hart.

"Information on this issue is starting to reach the general public, and it probably isn't widely understood just yet," he said. "However, once people do realize how this tax could impact them on a personal level, they wake up very fast."

"All my life, I've willingly paid my fair share of taxes in exchange for community services," said 73-year-old George Fedoro, a retired engineer who now lives in Boca Raton. "But this tax is not fair and could turn senior citizens into criminals, because no one that I know can or will pay it."

Florida Gov. Jeb Bush would have to approve any rule the tax department suggests. Bush has said he isn't in favor of the tax, but many fear he may be swayed by city and county government officials. The tax would go, in part, toward school construction and other projects.

Additional meetings on the proposed rules for the tax will be held in other locations around the state later in the year, Department of Revenue officials said.

If the law is implemented, Florida would have the most wide-reaching state tax on technology. But it may not be the last -- state officials estimate enforcement of the tax could bring in more than $1 billion a year in revenue for the state.
http://www.wired.com/news/business/0,1367,63962,00.html


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Tiffany Sues eBay In Counterfeit Items Suit

Luxury jeweler Tiffany & Co. has sued eBay, claiming the online auctioneer aided violations of the Tiffany trademark by letting counterfeit items be sold on its Web site.

A study of certain pieces of "Tiffany" jewelry sold on eBay this year showed that 73 percent of the jewelry was counterfeit, Mark Aaron, a Tiffany spokesman, said Monday in a statement about the lawsuit, which was filed Friday afternoon in U.S. District Court in New York.

Tiffany shares rose 21 cents, or 0.6 percent, to $37.94 on the New York Stock Exchange.

Shares of eBay fell 69 cents, or 0.8 percent, to $85.81 on the Nasdaq, down from a high of $87.24 earlier in the day.

"Since they are making the money from it, the public is being defrauded by it and Tiffany is being damaged by it, the question is who should bear the burden of policing it," James Swire, the lawyer representing Tiffany, said of eBay.

An eBay spokesman said the company has a program in place called VeRO, or verified rights owners, to help companies prevent fake goods from being sold on eBay.

"We take these concerns very seriously, which is why we have worked closely with Tiffany and thousands of other rights owners for many years through our VeRO program to help them address these types of issues," the eBay spokesman, Hani Durzy, said.

He added that he could not comment specifically on the lawsuit because eBay has not seen the complaint.

The lawsuit asks that eBay be stopped from listing any "Tiffany" merchandise that is not genuine and for eBay to account for profits it made on the sale of counterfeit Tiffany merchandise or else pay up to $1 million for each type of fake Tiffany merchandise sold on the Web site.

"We have been in correspondence with eBay for some period of time," Swire said. "A year ago, they declined to themselves police their auction sites for counterfeit Tiffany merchandise and said we should use the programs they have to police the site."

Using eBay programs like VeRO, Tiffany had two employees work full-time policing the site and forced the shutdown of about 19,000 auction sites on eBay, he said. This year, Tiffany randomly bought silver "Tiffany" jewelry on eBay and found that 73 percent of it was counterfeit, 5 percent of it was genuine, and the rest was promoted as "Tiffany-like" but not promoted as genuine.

Sales of shoddy counterfeit merchandise with the Tiffany name harms Tiffany's reputation, the company said.
http://news.com.com/2100-1038-5242722.html


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P2P telephony

Popular Telephony Unveils a New Server-Free Peer-to-Peer Telecommunications Technology for the Enterprise Market
Press Release

Popular Telephony Inc., a telecommunications middleware company, announced today at SuperComm 2004 (BOOTH #10841), the technology concept of serverless and switchless telecommunications for the enterprise market. The company's invention, Peerio(TM), is a groundbreaking, patent-pending core technology for the implementation of peer-to-peer, server-free telecommunications systems.

Peerio is a highly portable middleware application for embedded devices that seamlessly incorporates into VoIP ICs, IP phones and other telephony-enabled systems or modules. Enhancing current innovations in peer-to-peer computing, Popular Telephony's concept will enable groups of Peerio-intelligent devices to process phone calls in an interconnected manner as if served by an on or off-premises switch/server, but relying solely on the IP network infrastructure.

Expected to completely transform traditional telecommunication networks by eliminating routing through a centralized server -- node or switch -- Peerio successfully addresses scalability, security, redundancy and other system issues that are inherent in both enterprise and global telephony network implementation, while supporting all standard and advanced telephony features. Peerio is protocol-agnostic, enabling switchless and serverless communications for VoIP systems and devices running on SIP, H.323 and all other standard or proprietary protocols.

An Intellectual Property Company, Popular Telephony will be licensing Peerio on a non-exclusive basis, for integration into VoIP-enabled integrated circuits (VoIP IC's, colloquially known as "IP phone chips"), IP phones, enterprise telephone and audio/video conferencing systems and other telephony-enabled end user devices.

"We believe that Peerio technology is the next logical step in the progress of telecommunications, both from a technical and business standpoint," said Dmitry Goroshevsky, chairman and chief executive officer of Popular Telephony Inc. "This technology is very unique. Straightforward solutions like multi-cast just don't meet scalability, efficiency and security requirements, and as a result, many of our partners and beta customers did not believe the Peerio concept was possible. It is and it's here!"
http://home.businesswire.com/portal/...&newsLang =en


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Skype For Linux
Press Release

Skype Technologies S.A., the Global P2P Internet Telephony Company that offers consumers the ability to make free superior quality voice calls using their Internet connections, today launched the first beta version of Skype for Linux. The software can be downloaded for free and is available immediately for download at www.skype.com.

"We've had strong demand for a Linux version of Skype since debuting the Skype beta 10 months ago," said Niklas Zennstrom, Skype's CEO and co-founder. "Skype will continue to innovate by offering new quality telephony options, and listen to our users in setting priorities."

All Skype software; Skype for Windows, Skype for Pocket PC and Skype for Linux products is free and easy to download, simple to use, and offer superior call quality and security. Skype users control their online presence and contact lists, and have many options to customize their overall Skype experience. Skype for Linux retains the same core features of the Windows version of Skype software including free Skype to Skype worldwide calling, the ability to participate in conference calling with up to 5 people, instant messaging and access to the Global Directory.

"Part of what has made Skype such a success is the incredible participation of our users in the development of our product," said Zennstrom. "Linux itself is built on collaboration and the free exchange of comments and criticism, we look forward to hearing from this community to help us continue to improve our product."

Starting today, Skype for Linux beta software is available for download at www.skype.com. Skype for Linux requires a computer running at least a 400 MHz processor, 128 MB RAM,10 MB free hard drive disk space, sound card, speakers, microphone and an Internet connection. Skype for Linux beta has been successfully been tested on many recent distributions, including, but not limited to: SuSE 9, Gentoo 1.4, Debian ,,unstable", Fedora Core 2, Sun Java Desktop System Release 2. It should run on all distributions that have the required versions of glibc and Qt libraries available. Skype for Linux beta supports both KDE and Gnome desktop managers. A headset is recommended for optimal quality. The Skype for Linux user guide and FAQ, which includes a listing of supported Linux versions, is available at www.skype.com
http://www.companynewsgroup.com/comm...sp?co_id=89341


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SIP Hits Back At Zennstrom Accusations And Questions His Real Motives

Last week Faultline carried its thoughts and impressions from the VON (voice over networks) conference in London and focused on the difference between the instantaneous gratification of Skype for private individuals and the safe and efficient enterprise wide VoIP implementations, reliant mostly on the SIP protocol.

Swapping emails subsequently with Rohan Mahy, co-chair IETF SIP and SIPPING Working Groups, he took issue with some of the things that Niklas Zennstrom of Skype and Kazaa fame said at the conference, and although enterprise VoIP isn’t a central technology to Faultline, it is a valid and radical cost pressure on telcos and an opportunity for various vendors.

Much of the irritation that Mahy showed at the VON conference relates to the Zennstrom view that SIP is a poor protocol because of its inability to handle firewall and NAT traversal. So in Mahy’s own words we thought we’d offer the other side of the argument.

“There are very few people in the VoIP industry who understand firewall and NAT traversal well. Lots of people in the VoIP industry think that they have some technique which is new and good. Unfortunately the parts that are new are rarely good and the parts that are good are usually not new. Explaining to these people what is technically
broken with their proposals and why is an extremely time consuming process, and is repeated every time a handful of new companies start to go into the operational phase. As a result, the folks who understand these issues either go on a holy war each time a "new great NAT solution" crops or just ignore the new folks quietly.

“Implementers want a one-size fits-all solution where one does not exist. I can describe significant limitations with every approach, but by implementing a handful of these tools and applying the best tool for the situation, you can do much better than just implementing one.

When an implementer comes to me or Jonathan Rosenberg, or Jon Peterson and asks how to do NAT or Firewall traversal, most of them are frankly not willing to invest the attention and energy needed to implement real solutions to this problem for VoIP (not for SIP, but for VoIP). I believe that Niklas [Zennstrom of Skype] is in this category. He is not willing to admit that his solution is completely broken by firewalls that try to block p2p music sharing, that the algorithms which gives his product good sound quality can be implemented on any product, and that the supernode model not so occasionally results in very bizarre routing (example: a call within Europe going through Australia)

“As with anybody who has technical problems with IETF protocols, I invite them to write a description of what problem they are trying to solve which they feel is not addressed by existing protocols and provide some motivation. Zennstrom has not provided any rigorous analysis or even detailed explanation of these alleged technical problems.

“The traditional telecom folks want to reproduce an environment which is familiar to them. SIP does things differently, but many folks generally stop there and don't try very hard to understand how to accomplish their goals ‘the-SIP-way’.

“I believe that Zennstrom has a different motivation. He is providing a packaged service and I believe that he is afraid of the idea of open services and open protocols, because these things directly threaten his business model.”

Mahy thinks that eventually Skype will have to be connected to SIP, otherwise Skype users will be let unable to talk to the rest of the world.

“Sure, he ‘could’ use something else, but that would be economic suicide. When asked how he would get PSTN numbers assigned he said he would use partners who are telecom operators to provide these. These providers are already using SIP or H.323 and have no economic incentive to ‘each’ build a native-Skype interface on the thin margins that Skype is hoping to garner from its customers.”

So Faultline asked why doesn’t Mahy write a connection to Skype, using the APIs that Skype is intending to publish, after all he has 13 million users?

“He doesn't have 13 million ‘active’ users, far from it, so it is really not worth my time. I would rather spend my energy writing a free client with more functionality that is fully open.”

So does Skype need to talk to SIP clients one day or can it just talk to the PSTN and then route back out to SIP clients?

“That's missing the point, don't you think? Say a Skype user in India wants to communicate with me in California on a SIP network. He can make a basic call through 2 gateways with international toll charges. Its unlikely that I will see his correct caller ID, and dead certain that we can't exchange IM, video, presence status, or do file transfers. A pair of implementations using SIP could do this for free over the public Internet.”

Talk then turned to the security that Zennstrom says exists in Skype that doesn’t exist in SIP. Mahy thinks the Skype approach is inviting viruses, Zennstrom says this is not possible. According to Zennstrom there is little danger of a call through Skype resulting in a route for a virus because the recipient is told there is a call for him and is asked to call out to meet it.

Mahy tells us that there are rapidly appearing firewalls that are deliberately eliminating use of Peer to peer networks, including the one Skype sits on, because of security issues.

“Once my machine is infected with a virus, that virus can do lots of rude things with the Skype API. The virus could call a PSTN toll or international service from my account and leave it up for days. The virus could spam call my entire buddy list a few times an hour. The virus could turn my computer into a remote-control microphone. These are the kinds of issues that IT administrators are concerned about. Also, many administrators want to block p2p to prevent liability from the RIAA and similar groups. With at least one product the side effect is no Skype.
http://www.rethinkresearch.biz/page_...%88%97mvw% 8C


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Patents Court A First For Japan
Leo Lewis

THE Japanese Government has pushed through a law that will create Japan's first intellectual property high court, amid fears of a "tidal wave" of patent disputes.

The specialist court, sitting from next April, will be given sweeping powers to resolve disputes. It aimed to pre-empt a huge leap in the number of patent disputes expected between Japan and its Asian neighbours, government insiders said.

The Government also planned to send lawyers and judges to Britain, Brussels and the US to study recent cases, and invite overseas legal experts to teach in Tokyo, Japanese cabinet sources said.

Hidetoshi Masunaga, Japan's highest-profile intellectual property lawyer, said: "This is an extremely positive move, but it is shameful that Japan has been so far behind. Of course, it will be necessary to rapidly study the way cases work abroad, but the most important thing is that the court be both respected and feared. It has to have the experience to demonstrate it is in charge."

Proposals for the judicial reforms have been speeded up after an acrimonious spat between the electronics giant Sharp and a Taiwanese television manufacturer. Sharp, widely acknowledged as the global leader in cheap LCD screens, is seeking a ban on sales of LCD screens made by Teco, the Taiwan-based company.

The lawsuit, which alleges a string of patent infringements, risks growing into a diplomatic rift between Japan and Taiwan.

Other companies, including Sony and Pioneer, are seeking to preserve their "technological cushion" over other Asian competitors, as China and Taiwan perfect ways of copying a wide range of consumer electronic devices, like digital cameras, laptop computers and mobile phones.

Peter Godwin, a partner in Herbert Smith Japan, said: "This Sharp case is just the start ... Japan has suddenly realised that intellectual property rights are something that Japanese companies have a lot of and they need to defend them."
http://finance.news.com.au/common/st...%5E462,00.html


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Anti-Piracy Bill Would Hit P2P Networks
Out-Law.com

A draft bill due to be debated in the Senate this week would make anyone who “intentionally induces any violation” of US copyright law liable for that violation, presenting a threat to anyone who promotes a peer-to-peer network such as Kazaa.

The US entertainment industry, led by the Recording Industry Association of America, has been trying for years to counter the phenomenon of file-sharing, where users distribute and download copyrighted music over P2P services.

Legal actions against the networks, file-swappers, the creators of software that circumvents security features, and the purchasers of that software have all been filed, with varying degrees of success.

But the industry has also been lobbying hard for the introduction of laws that will more fully protect it from copyright abuses. The proposed Induce Act (otherwise known as the Inducement Devolves into Unlawful Child Exploitation Act) is the latest of these.

Likely to be introduced to the Senate this week by Senator Orrin Hatch, the bill makes it an offence to intentionally induce any violation of the existing US Copyright Act. It defines “intentionally induces” as “intentionally aids, abets, induces, counsels, or procures”, and infringers face fines or even a prison sentence.

The proposals have not yet been officially published, but have already been criticised by consumer groups and civil liberties organisations for being so broad as to attack any service or device that has the potential to be used for copyright infringement.


Jeff Joseph, vice president for communications at the Consumer Electronics Association, told CNET News.com: “It's designed to have this fuzzy feel around protecting children from pornography, but it's pretty clearly a backdoor way to eliminate and make illegal peer-to-peer services. Our concern is that you're attacking the technology."

The problem with legislating against decentralised P2P services is that shutting down the network will be near impossible. You can act against individuals who use the services; you can act against individuals or companies that make the networking software available to others; but unless you stop or sufficiently deter all these parties, you can't shut down the pure-P2P network itself.
http://www.out-law.com/php/page.php?...2775&area=news


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Smooth Internet File Sharing

Helios WebShare offers easy, speedy, browser-based access
Keith Schultz

Cost:
$6,990, 105 user licenses for WebShare only (includes $780 yearly maintenance); $24,950, 105 user licenses for WebShare, ImageServer, EtherShare, and PDF Handshake

Platforms:
Mac OS X, Linux, various Unix distributions

Methodology
Xythos WebFile Server, which I reviewed earlier this year (infoworld.com/1097), combines Web-based file sharing with impressive document management capabilities. A new alternative, Helios WebShare 1.0, lacks document management -- and even document search capabilities -- but provides easy and secure remote file access and management for any user with a browser. With the addition of optional services, WebShare even allows users to preview graphic images and PDFs without having to download the files.

WebShare is available only for Mac OS X, Linux, and various Unix platforms -- no Windows version at this point. Because it uses Apple’s WebObjects, you will need a valid WebObjects license, which is available from Apple for $699. I tested WebShare on Red Hat Linux 9, using Microsoft Internet Explorer 6 to access shared files.

WebShare organizes files in groups called Sharepoints, which are created by the WebShare administrator and provide a way to define access to files based on users and groups. For example, you can create a Sharepoint that facilitates previewing, downloading, and file copying but does not allow uploading, deleting, or renaming. To define multiple access levels to a group of files, the administrator must create different Sharepoints with different attributes for each user group. Users’ group memberships dictate their levels of access.

Before creating a Sharepoint, administrators must first create a directory structure through the host operating system. Administrators cannot create a Sharepoint and have WebShare create the underlying structure for them. Although users cannot establish Sharepoints on their own, they can create subfolders within existing Sharepoints.

User permission management is one area where WebShare could stand some improvement. User access to Sharepoints and files relies on permissions set in both WebShare and the host operating system. WebShare will pull user names from LDAP, NIS (Network Information Service), and its own user database, but to truly lock down file access, administrators will sometimes have to resort to managing permissions through the operating system. I would like to see all user access control managed through a single interface.

One nice feature is WebShare’s Zip Stream technology. When you select multiple files for download, Zip Stream will automatically compress the files into a single archive for faster transfer.

WebShare offers other cool capabilities via its ImageServer and PDF Handshake add-ons. ImageServer allows you to view various graphic formats, including TIFF, JPEG, QuarkXPress, and Adobe InDesign files, in your Web browser without having to download the file. ImageServer renders these formats into bitmaps that you can quickly resize, rotate, and otherwise manipulate in your browser. PDF Handshake extends these preview capabilities to PDF documents. For those in the graphics business, this can greatly speed up locating graphics and images.

Because WebShare is not intended to be a document management solution, it should not be looked at as such. What you get is fast, reliable Web-based file sharing, and that’s about it. User permission management and Sharepoint creation could be improved, and I would love to see a search feature added.

WebShare is easy to deploy and to use and is an effective way to bring file sharing to Internet-based workgroups. For larger deployments or any scenario in which tracking versions of documents is necessary, Xythos WebFile Server is a better choice.
http://www.infoworld.com/article/04/...Chelios_1.html


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Music Industry 'File-Sharing Pioneer'
Macworld staff

The music industry is showing the entertainment industry the way out of the "dark file-sharing tunnel", a key industry figure claims.

Universal Music eLabs business development director Dan Whiley told International Herald Tribune: "Music was the first entertainment industry to go into that dark file-sharing tunnel, so we've taken all the early bruises. Maybe we're first out of the tunnel, and maybe our solutions will set some precedents for other industries that depend on copyright and intellectual property."

Most analysts predict the biggest lesson to be learned will be that of compatibility, with Apple and Microsoft refusing to accommodate each other's digital rights management systems, something that will become even more apparent as more and more download services join the market.

The Music Industry Federation estimates that there are now more than 50 online music retailers operating in Europe. Jupiter Research analyst Mark Mulligan says: "Young people have grown up expecting online music to be free. That isn't going to change overnight. But European consumers finally have a choice of compelling, competing services."

But while competition is a good thing it also brings complications – analysts say the rivals could turn off consumers with an array of incompatible technologies and sometimes incomplete product offerings.

One analyst, who wished to remain nameless, said: "If the rivals choose to battle it out over formats and technology – rather than solve their differences by cross-licensing – they risk losing the bigger struggle against piracy.
http://www.macworld.co.uk/news/index...ge=1&pagePos=7


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Beatles Could Write Own Ticket To Ride The Internet
Daniel Rubin

The long and winding road online? Give PCs a chance?

Six years into the digital-music revolution, the Beatles are, at last, talking with online providers about offering their catalog on the Internet. Microsoft and its competitors could offer as much as $10 million for exclusive rights to sell the Fab Four on the Web, analysts predict.

But how big a market is there really? Don't digitally savvy boomers already have the songs, which started coming out on CD reissues in 1987? And won't younger fans just trade for what they want?

"Excellent band," mused Chris McManus, 18, walking down Walnut Street in Center City one day last week, earphones in place.

But no sale. "I already have all of their recordings on my iPod," explained the bass player from Roxborough. Most songs he bought. Some he borrowed.

Or ask Everett Katzen, owner of Springboard Computers in Center City: "Kids aren't going to be buying the Beatles. They're listening to Eminem."

Many music-industry insiders beg to differ. They cite the enormous multigenerational popularity of Beatles music, both sold and stolen.

Having the Beatles "would absolutely be appealing," said Bob Ohlweiler, MusicMatch's senior vice president for business development. "The three missing artists [online] are the Beatles, Garth Brooks and Led Zeppelin."

In the Nielsen SoundScan era that began in 1991, the Beatles have moved more albums than all but one act.

That's 49.7 million albums. Only Brooks has sold more.

If you want proof that the Beatles have fans among those born long after their 1970 breakup, look online.

More than one in every 300 songs traded online between May 7 and June 7 was by the Beatles, according to Eric Garland, chief executive officer of BigChampagne.com, who monitored all major file-sharing networks. In the United States, about 20 million people swap songs every month, he said.

That figure staggered Garland, a Beatlemaniac who owns every Fab Four recording, including their annual Christmas messages. "Considering that we're talking about the history of pop music that's available online, that number has to be hundreds of times what I would have guessed."

Nearly 15 percent of the nine million people worldwide who are sharing music online at any given moment offer Beatles songs, Garland said - on average, more than four songs each.

And since file-sharers tend to be young - half are under 22, according to Forrester Research - there's a potentially endless fountain of youthful fans.

Reports this month had Paul, Ringo, Yoko Ono and Olivia Harrison in negotiations with a number of online merchants. One mentioned was Microsoft, which is planning to introduce its own Internet music store. There also was talk that the Beatles were exploring selling their music online themselves, as Dave Matthews does.

Josh Bernoff, a Forrester Research analyst, sees a lot of cash in the Beatles catalog. His company estimates people will spend $300 million on downloading this year. Applying BigChampagne's numbers, that means more than $1 million of it could be for Beatles songs.

The online providers need the money more than the Beatles do, Bernoff noted. Right now, Apple's iTunes dominates the market with 70 percent of sales. Its competitors include Napster, MusicMatch, RealRhapsody and AOL.

Any of them would salivate at being able to offer the Beatles exclusively for a long period. "It could create an edge," Bernoff said.

Only one company needs to make a name for itself in online music and has lots of money - Microsoft. "If it's anybody [to win an exclusive], it will be Microsoft," he said.

Meanwhile, fans such as Daniel Mufson, 21, of Center City, are imagining fixing some serious holes in their collections:

"Sgt. Pepper," said the digital-production major at Hofstra University. His father gave him a vinyl pressing of the Summer of Love classic.

"Record playing," he says, "is... impractical."
http://www.philly.com/mld/philly/ent...8979750.htm?1c


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Music Downloads: Pirates—or Customers?
Sean Silverthorne

Professor Felix Oberholzer-Gee and co-author Koleman Strumpf floored the disbelieving music industry with their findings that illegal music downloads don’t hurt CD sales. Oberholzer discusses what the industry should do next.

Internet music piracy not only doesn't hurt legitimate CD sales, it may even boost sales of some types of music.

Those were the counterintuitive findings released in March by Harvard Business School professor Felix Oberholzer-Gee and his co-author Koleman Strumpf, of the University of North Carolina at Chapel Hill. Their paper, "The Effect of File Sharing on Record Sales," caused a ruckus in the music industry not seen since the British invasion of the Beatles.

Many recording executives were not singing "Yeah, yeah, yeah," however. Convinced that illegal downloading and file sharing has robbed them of billions of dollars after four consecutive years of falling music sales, they criticized the team's methodology, which consisted of monitoring 1.75 million downloads over 17 weeks in 2002, scouring through server logs from OpenNap (an open source Napster server), and comparing the sales of almost 700 albums as reported by Nielsen SoundScan. Oberholzer and Strumpf concluded that there was almost no relationship between the two.

How could this be? The researchers believe that most downloading is done over peer-to-peer networks by teens and college kids, groups that are "money-poor but time-rich," meaning they wouldn't have bought the songs they downloaded. In that sense, the music industry can't claim those downloads as lost record sales. In fact, illegal downloading may help the industry slightly with another major segment, which Oberholzer and Strumpf call "samplers"—an older crowd who downloads a song or two and then, if they like what they hear, go out and buy the music.

Interestingly, the first half of this year saw the release of numbers seemingly supporting this theory: The number of illegal music downloads continued to increase—but so did music sales.

If in fact the research is correct, the strategic implications for the music industry are profound. Instead of conducting a high-profile campaign against pirates, should the industry instead target "samplers" to encourage them to buy more music? Should the industry consider peer-to-peer services as marketing tools rather than the enemy? Should online pricing be different from in-store pricing? What happens when broadband makes it as easy to illegally download an entire CD as an individual track or two? HBS professor Feliz Oberholzer-Gee recently spoke to Working Knowledge about these issues.

Sean Silverthorne: The draft of your paper with Koleman Strumpf came out almost three months ago, and caused quite a stir both inside the entertainment industry and out. What are your impressions of the reactions so far?

Felix Oberholzer-Gee: Two recent developments are important. Our study provides the first serious evidence that file sharing cannot explain the decline in music sales in the last couple of years. In addition, in the last two quarters, music sales increased while file sharing has become even more popular. BigChampagne.com, an Internet monitoring firm, estimates that there are now up to 9 million simultaneous file sharers, up from about 4 million in early 2003.

In view of our evidence and these new trends, even the Recording Industry Association of America (RIAA) now states that file sharing is only "one factor, along with economic conditions and competing forms of entertainment that is displacing legitimate sales." The industry is rethinking its position, although change occurs slowly.

Q: Let's talk strategy. What have been the recording companies' strategies to date for combating their loss of property rights via illegal downloading? And how effective has that strategy been? For example, is it a good thing to sue potential customers?

A: Suing potential customers is not exactly a standard entry in the book of good CRM. More importantly, the RIAA's legal strategy is hopeless and smacks of short- sighted panic.

Our research shows that only 45 percent of music files downloaded in the United States come from computers in the U.S. More than 100 countries supply files to the U.S. file-sharing community, and many of these countries do not have strong records of protecting copyrighted materials. The RIAA does not stand a chance to implement an effective legal strategy in all these countries.

Those who dream of legal solutions do not recognize the truly global nature of the peer-to-peer (P2P) phenomenon. Even worse, the RIAA's legal strategy does not even seem to work here in the United States. Despite the lawsuits—the RIAA has sued about 2,000 individuals to date—file sharing is more popular than ever.

Q: Assuming your conclusion is right—that there is no evidence that illegal music downloads erode CD sales—and in fact might help top-selling record sales—what are the implications for the recording industry in terms of strategy?

A: Our research shows that people do not download entire CDs. They download a few songs, typically the hits that one would also hear on a Top 40 station. This suggests that P2P is much like the radio, a great tool to promote new music. The music industry has of course long recognized that giving away samples of music for free over the airwaves can stimulate sales. The same seems to hold for P2P.

The problem with radio as a promotional tool is that it can be quite expensive for labels to get radio stations to play their music. P2P networks are promising because they make the market for music promotion more competitive. From the perspective of the music industry, the more competition among P2P services, the less costly it will be to promote music.

Q: Apple's iTunes has seemingly validated the concept that people will purchase music online. But it seems the recording companies themselves have done little on their own to experiment with models here, such as tiered pricing (hits cost more) and bundling.

A: The classic business model was a teaser model: The music labels provided one or two hit songs for free by promoting them on the radio and on MTV. If consumers liked the samples, they purchased a dozen songs at a price of $15. We now have gone from one extreme to the other. While inflexible bundling was the rule, services such as iTunes now completely unbundle CDs and offer all music by the song. The difficulty with this approach is that the economics of producing music are characterized by significant fixed costs. It is not much more expensive to promote an entire album than to promote an individual song. With complete unbundling, the revenue streams generated by a new album are likely to be much lower. How many consumers will pay a dollar for song number thirteen?

Clearly, there is a profit-enhancing role for some type of bundling even with digital distribution. For example, consumers might be willing to pay full price for the core songs on an album if they get the rest at a discount. We need systematic experiments to find out which types of bundling are economically most attractive.

Q: What's the current state of your research? Where does it go from here?

A: A key uncertainty relates to our finding that file sharers do not download entire CDs. We do not know why they sample only a few songs. One possibility is that the current patterns of file sharing reflect consumer preferences. Consumers do not know the quality of new music and sampling one or two songs is good enough to assess quality and make a purchasing decision. If this view is correct, the radio model is well and alive, and P2P offers great opportunities to promote new content.

However, it is also possible that the observed behavior is due to technical difficulties. In our data, only one out of three downloads is completed successfully. File sharing is fairly cumbersome for many consumers with poor Internet connections. If this is the reason for highly selective sampling, we can expect consumers to download entire CDs when broadband connections become more common. This is a less rosy scenario for the music industry because downloads of CDs are likely to be closer substitutes for CD purchases.

If poor Internet connections explain file-sharing patterns, general access to broadband would have profound strategic implications, suggesting that music companies ought to pursue a strategy of selling complements to recorded music. We see some examples for this strategy even today: Apple sells songs to promote its iPods. Prince gives away his most recent release to promote his concerts. We need careful continuous monitoring of the effects of P2P to know which strategies are most appropriate in the digital age.
http://workingknowledge.hbs.edu/item...6&t=innovation


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Labels To Dampen CD Burning?
John Borland

The recording industry is testing technology that would prevent consumers from making copies of CD "burns," a piracy defense that could put some significant new restrictions on legally purchased music.

Tools under review by the major labels would limit the number of backups that could be made from ordinary compact discs and prevent copied, or "burned," versions from being used to create further copies, according to Macrovision and SunnComm International, rivals that are developing competing versions of the digital rights management (DRM) software.

SunnComm said a version of its new "secure burning" technology is already being tested by BMG Music Group, the world's fifth-largest record label and the most aggressive to date in pushing CD copy protection schemes in the United States. Macrovision's version is expected to be ready in the next few months.

If implemented widely, the new technology would mark a substantial change in the way ordinary people can use purchased music, possibly alienating some customers, analysts said. Given the costs of piracy, however, the labels are moving ahead cautiously in the hope of striking on a formula that works.

"There is a fine (DRM) balance that nobody has struck, especially with physical CDs," said Mike McGuire, an analyst with the GartnerG2 research group. "If there's somebody who's making 25 copies for the world and finds they can't do that, then few people will probably complain. But if someone finds they can't make a copy for their kid so he can play it in the car, you're going to have a lot of people returning broken CDs."

The trials come as record labels seek to tighten copying restrictions on CDs, a market worth more than $11.2 billion in the United States in 2003. The labels have attributed recent, significant slides in retail CD sales in part to competition from home copying, as well as online file swapping.

Consumer concerns
Record labels are seeking a way to let consumers make a limited number of copies of their music--enough for a car, a vacation home and a friend, for example--without allowing for uncontrolled duplication. Under the current system, each copied CD can itself lead to an unlimited number of additional copies, cutting substantially into sales, they say.

Consumer advocates, meanwhile, have protested against abridgments of today's unlimited freedom to copy, remix or sample from music CDs.

Record labels in the United States have been sensitive to these consumer concerns, worrying particularly about earlier versions of copy-protection technology that had difficulty playing in nontraditional CD players such as game consoles or car stereos. They've released many protected CDs overseas, but only a small number in the United States and United Kingdom, where perceived opposition has been the highest.

The new plan to lock down burns could reignite a controversy that's smoldered in the United States since the independent release of country artist Charley Pride's album in 2002 incorporated SunnComm's early copyproofing technology, prompting at least one consumer lawsuit.

In addition to adding a new layer of copy protection on CDs, SunnComm and Macrovision each say their CD burning limitations could be applied to digital download businesses such as Napster or Apple Computer's iTunes, which do not put any restriction on burned CDs. That potentially could set off a new round of skirmishes between such digital download businesses and the record labels over how consumers can use the music they buy online.

"What labels have told us is that their agreements (with the download services) are relatively short term, a year or under, and so they believe that they have the capability to require (the burning tools to be added) next time around," Macrovision Chief Executive Officer Bill Krepick said.

Record label executives, although they take very different individual approaches to the market, say they ultimately want to see the rules for CDs and digital downloads converge.

"I would say that similar values should apply," said Jordan Katz, executive vice president and general manager of BMG's distribution arm.

Digital download services say they aren't yet feeling pressure to add the "secure burning" feature, however. Some said the labels had spent more time discussing the issue as much as six months ago but that it hadn't been a priority recently.

"I think the labels have been relaxing a little in terms of usage rules," said Liz Brooks, vice president of business development at Buy.com's music division.

A checkered history
To date, the history of CD copy protection in the United States has been spotty. Though Macrovision and SunnComm each say their technology is used widely overseas, only a few albums have been publicly released using their technology here.

BMG, which has taken a lead in this area, used SunnComm's anticopying tools on last year's Anthony Hamilton disc. The release gained some prominence after a Princeton student demonstrated that the protections could be easily evaded simply by pushing a computer's Shift key while loading the CD.

Executives at SunnComm and BMG said they were aware of the issue and that they had been satisfied with the technology as a deterrent to casual copiers, rather than trying to create an unhackable protection.

BMG announced last week that it would release three more albums using the technology over the next two months, including recordings by Velvet Revolver, Angie Stone and Yung Wun.

Other labels say they are still very interested, but not quite as far along as BMG.

"EMI does use Macrovision's technology in just about every country in the world," EMI spokeswoman Jeanne Meyers said. "We're testing other forms of technology from a lot of different companies before launching in the U.S. and the U.K."
http://news.com.com/2100-1027-5224090.html


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Copy-Blocked CD Tops U.S. Charts
John Borland

For the first time, the No. 1 album in the United States is loaded with anticopying protections, marking a clear step into the mainstream for the controversial technology.

According to figures released by Nielsen SoundScan, Velvet Revolver's "Contraband" was the top-selling album in America last week, despite being prominently labeled on its cover as being "protected against unauthorized duplication."

The success of the album is likely to prompt more experiments from BMG, the band's label, and other record companies, industry watchers said.

"It's too soon to tell whether the rest of the industry is going to be heartened by this," said Mike McGuire, an analyst at GartnerG2. "But clearly, there are going to be a lot of people who are very encouraged by the fact it is out on the marketplace."

The step forward is part of a slow increase in the flow of copy-protected compact discs into the American market, after several years of stalled progress. If the pace increases without substantial consumer backlash, the technology could become as commonplace as the antipiracy technology on DVDs, ultimately changing the way that consumers use their purchased music.

For several years, the big record labels have experimented with various versions of the technology, worried by the explosive popularity of CD burners and online file trading.

However, they have been wary of releasing the technology in the U.S. market on a wide scale. Early versions of copy-protected CDs had problems playing in some CD players and computers, prompting customer complaints and even recalls.

A vocal segment of the online population has been intensely critical of the copy protection plans, leading record label executives to worry about potential consumer reaction. Some artists, such as Virgin Records singer Ben Harper, have been bitterly angry at their labels' decision to include the technology without their approval.

The test with Velvet Revolver, a group made of alumni from Stone Temple Pilots, Guns N' Roses and others, was the largest yet for BMG. The test uses MediaMax copy protection from BMG partner SunnComm International. The label says it does plan a growing number of protected releases over the course of this year, but is still choosing which CDs will include the technology on a case-by-case basis.

"We're thrilled with the results we've seen and the apparent consumer acceptance," said Jordan Katz, an executive vice president in BMG's distribution arm. The company has released a total of 12 "copy managed" discs, with more than 2.5 million units now in the market, he said.

iPods still a problem
Like other recent copy-protected albums, the Velvet Revolver disc includes technology that blocks direct copying or ripping of the CD tracks to MP3 format. It also comes preloaded with songs in Microsoft's Windows Media Audio (WMA) format, which can be transferred to a computer or to many portable digital music players.

As in earlier tests by BMG and SunnComm, the copy protection on the Velvet Revolver disc can be simply disabled by pushing the "Shift" key on a computer while the CD is loading, which blocks the SunnComm software from being installed. The companies say they have long been aware of the work-around but that they were not trying to create an unhackable protection.

According to SunnComm, few purchasers have complained about the anticopying tools, although angry postings on sites such as Amazon.com are common. The sticker on the front of the Velvet Revolver CD and a link inside the software that loads automatically on a computer, once a user has given permission, points to SunnComm's Web site.

"We hear from less than half of one percent of people who have the Velvet Revolver disc," SunnComm CEO Peter Jacobs said. "Most of those questions are related to getting the songs onto an iPod."

However, the inability to move songs to Apple's popular digital music player, as well as to other devices that don't support Microsoft's Windows Media digital rights management services, is a serious shortcoming. Jacobs says SunnComm recognizes that--and that the company's next version will go beyond the Microsoft files and be able to create multiple kinds of digital files that will be compatible with the iPod.

But for now, iPod-owning Velvet Revolver fans don't have a direct alternative.

"We are actively working with Apple to provide a long-term solution to this issue," a posting on SunnComm's Web site reads. "We encourage you to provide feedback to Apple, requesting they implement a solution that will enable the iPod to support other secure music formats."

Also on Thursday, SunnComm announced that EMI Music would begin using its technology on advance and promotional releases. That marks the second major label, following BMG, to adopt SunnComm's tools officially, although others are also testing them.

EMI Music has "been encouraged by the success that SunnComm's MediaMax product has enjoyed," Richard Cottrell, global head of antipiracy for the record label, said in a statement. "We are pleased that SunnComm is developing a product that improves our ability to protect our artists' works, especially during the prerelease phase."
http://news.com.com/2100-1027-5238208.html


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Latest Anti-Piracy Device: A Really, Really Small CD
Jo Best

Although online music is finally looking like it might be taking over the mainstream, Universal Music is hoping to win over pop pickers to a new physical format: pocket CDs.

It's smaller than the traditional compact disc, comes with a mobile ringtone thrown in, and the tiny disc has got the record labels hoping to revive the flagging sales of hard copies of music, according to the Financial Times.

The mini-CDs will be half the size of the traditional variety and are thought to be due for release later this month by a variety of pop artists. According to the report, the CD won't need any new hardware and will contain a code to let buyers download a mobile phone ringtone.

Universal might be trying to bring the CD back from the dead but it's got a long way to go. According to figures from the British Phonographic Association, the decrease in CD single sales between the first quarter of 2003 and the same period this year has been 32 per cent.
http://hardware.silicon.com/storage/ 0,39024649,39121548,00.htm

[JackSpratts]

SBC Ups The Broadband Ante

Fiber will soon reach farther
Joshua

SBC announced on Tuesday that it is planning some major renovations to its network--renovations that will push high-speed access closer to customers. Currently, the company's fiber-optic network reaches to within 12,000 feet of many of its customers, part of the push from the company's Project Pronto. The new project will push fiber even further, to within 5,000 feet of homes and businesses.

The updated network is designed to be compatible with IP-based connections, including super-high-speed Internet, IP-based digital TV, and Voice over IP (VoIP). The speeds associated with this new network will be extremely fast. Customers can expect to have between 15 and 25 megabits per second (Mbps) dedicated to them for downloading, and 1 to 3 Mbps dedicated for uploading. (Just for comparison, my DSL line download speed at home hovers around 1 Mbps.)

The network expansion will include building Fiber To The Premises (FTTP) for all new construction and Fiber To The Node (FTTN) for all current customers. FTTN will bring the fiber optic lines to nodes providing service to as few as 300 to 500 homes.

The investment for this network upgrade will run between US$4 and $6 million; the upgrade will take about 5 years to deploy. Trials are planned for this summer in neighborhoods within the SBC service area, and the upgrade will begin as soon as the proverbial ducks are in their row.
http://www.geek.com/news/geeknews/20...0624025704.htm


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Police Exaggerate ID Theft: Expert
Kelly Mills

REPORTS of increasing identity fraud attacks have been exaggerated by law enforcement agencies seeking to maintain budgets, according to a former Scotland Yard detective.

Identity fraud attacks, such as phishing, have increased in the past year as international syndicates target Australian financial institutions.

However, SAS Institute fraud and anti-money laundering solutions director Rowan Bosworth-Davies, a former Scotland Yard detective and lawyer, says identity theft is relatively rare.

"I would need more evidence from law enforcement agencies of identity theft before I got too excited about it," he says.

"It is a sexy subject and you can say what you like and no-one will say that you are wrong."

Bosworth-Davies says there is a lot of hype around identity theft and a great deal of misinformation, which he attributes partly to some police agencies that want to increase funding.

"If someone was living the life of Riley on your credit card, wouldn't you know within a month, when you got your credit card statement?"

Bosworth-Davies says genuine cases of identity fraud, using stolen credit card details and other identity documents, are relatively few.

Speaking at the SAS International Forum 2004 in Copenhagen, Bosworth-Davies was also critical of banks' ability to deal with money laundering.

Prior to September 11, 2001, there was debate about money laundering, and if banks had software it was largely developed internally, he says.

In the past three or four years, however, large banks had installed anti-money- laundering software to comply with new international regulations.

"Leading banks in the UK have adopted new solutions, but it would be less true in Australia, which has different regulatory drivers."
http://australianit.news.com.au/arti...E15306,00.html


~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

ILN News Letter

German Supreme Court Issues Hyperlink Decision

Baker & McKenzie's E-law Alert reports that the German Supreme Court has ruled that a hyperlink in an online article that leads to an illegal website does not establish liability based on the link. A major German newspaper had published an online article containing a hyperlink to Austrian net gambling site. While the Court held that the net gambling site is illegal since it did not have a German gambling permit, it ruled that the publisher is not liable for such illegality, as he did not have the intention to promote illegal gambling over the Internet.


4th Circuit Rules ISPs Not Liable For Passive Copying

The 4th Circuit Court of Appeals has issued its decision in Costar v. Loopnet, ruling that ISPs do not copy material in direct violation of the Copyright Act when passively storing material at the direction of users in order to make that material available to other users upon their request. The court added that the automatic copying, storage, and transmission of copyrighted materials, when instigated by others, does not render an ISP strictly liable for copyright infringement, though an ISP can become liable indirectly upon a showing of additional involvement sufficient to establish a contributory or vicarious violation of the Act. In that case, the ISP could still look to the DMCA for a safe harbor if it fulfilled the conditions therein.

Case name is CoStar Group v. Loopnet. Decision at http://caselaw.findlaw.com/data2/circs/4th/031911p.pdf


French Rights Organizations Call For P2P License

Two French Performers Rights Organizations have called for the establishment of a peer-to-peer license. Adami and Spedidam have called for the creation of such a license, though the two disagree on whether it should cover both uploads and downloads or downloads only.

French language coverage at http://www.zdnet.fr/actualites/inter...9157528,00.htm


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DRMin’

Electronics Firms Take Step Toward Compatible Gadgets

A consortium of the world's largest computer and electronics companies on Tuesday established ground rules for building compatible electronic devices that can share movies, music and other media.

But the group quickly acknowledged that even greater challenges, including agreeing on how to protect digital content from theft, had to be overcome before consumers can create, manage and share content on any electronic device.

Many of the 145 global companies, including Sony Corp.(6758.T)(SNE.N) and Microsoft Corp (MSFT.O), are deeply wedded to proprietary ways of storing and processing digital media content. The group, however, found consensus in common and existing standards for audio, video and Internet communications.

Products that meet the specifications of the Digital Living Network Alliance will be awarded a logo that will let shoppers know that such a device will work with other certified products. The first compatible electronics could start appearing on store shelves by the end of this year.

Several challenges became apparent as participating executives gave a presentation to reporters in San Francisco. For one, the group acknowledged that they had yet to agree upon an anti-piracy technology for movies and music.

Easier Said Than Done

Even if an agreement is eventually reached on so-called digital rights management, business arrangements with movie studios and record labels would likely have to be renegotiated to allow such content to be shared on multiple devices and converted into different digital formats.

``The whole copy protection issue is an order of magnitude more complex than anything we've done so far,'' said Pat Griffis, the director of worldwide media standards for Microsoft's Windows client division, and vice chairman of the technology alliance.

Also, despite the large collection of companies, at least two important names in consumer electronics were absent from the alliance: Apple Computer Inc. (AAPL.O) and RealNetworks Inc.(RNWK.O) Apple did not immediately return a call seeking comment. Real said it would consider joining at a later date.

Apple's portable music player, the iPod, has become a highly profitable success in legal music downloading. RealNetworks, for its part, this month reached an agreement with Starz Encore Group to set up a flat-rate movie download service for people with broadband Internet connections.

Group members also acknowledged that marketing and pricing missteps with early versions of home content sharing devices -- such as ``digital media adapters'' that send audio and video from a computer to a stereo or TV -- had put off many consumers.

``When consumers go to the store, they're not exactly sure what they're looking at,'' said Scott Smyers, a vice president at Sony Electronics and chairman of the group. That problem, he added, is not going away.

``The products are not getting less complicated. They're actually getting more complicated,'' he said.
http://www.nytimes.com/reuters/techn...gitalhome.html


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Wanted: New Friend, Must Have Bluetooth

SINGAPORE - Student Gracinia Lim has made new friends thanks to mobile phone software that alerts her to compatible people nearby.

She is an early customer of a service in Singapore called BEDD that uses Bluetooth wireless communications to scan strangers' phones for their personal profiles.

The application joins a swelling number of Internet and mobile phone based services that offer to widen people's social networks.

Users download the BEDD software into a compatible phone, complete a short profile of themselves and include a description of who they want to befriend, or an item they want to buy or sell.

The software automatically searches for and exchanges profiles with other phones that come within a 20-meterradius. Matched users are given each other's contact details.

``I've become close with people that I've never known before, built up a close clique of friends whom I chill out with, sleep over at their homes and go for late suppers with,'' said Lim, 19.

The software, created by futures trader Stephen Carlton and Swedish engineer Olle Bliding about three years ago, was launched last month in Singapore and will be rolled out in most of Asia by year-end. It costs S$0.98 ($0.571) for 30 days of unlimited use.

BEDD differs from rival services in that it relies on phone-to-phone transmission, running on the short-range Bluetooth technology. Other mobile-based dating services in Asia -- such as Singapore Telecommunications Ltd.'s MyCupid and Bharti Airtel of India's TrackUrMate -- exchange information through a central database. Carlton said BEDD has over 1,000 users in the city state and hosts get-togethers in coffee bars where people let their phones make their introductions. As the number of customers grows, the chances of meeting a compatible person at random in the street or on a bus will grow.

``People spend tons of money at dating and matchmaking agencies or on personal ads -- for a small amount of money, this software could help change their lives,'' Carlton said.
http://www.nytimes.com/reuters/techn...e-friends.html


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Movie Ticket Prices Hit All - Time High

LONDON - The cost of going to the movies hit an all-time high last year as the construction boom in plush multiplex cinemas continued to push up ticket prices, according to research on Wednesday.

In its ninth annual worldwide survey on movie ticket prices, London-based media research group Screen Digest said average ticket prices rose in 40 of the 45 countries it tracks.

The global average ticket price in 2003 was $5.20, up 4.8 percent in local currency terms.

At 1,252 yen -- $10.80 in 2003 average currency terms -- Japanese ticket prices were the most dear. Rounding out the top five were Switzerland, Sweden, Norway and Denmark. Britain ranked tenth.

Screen Digest said a major culprit was construction of multiplexes, the state-of-the art cinema complexes that come equipped with air-conditioning, enhanced sound systems and sometimes shops and videogame arcades under a single roof.

Multiplex ticket prices tend to be higher than those charged at older, ``arthouse'' cinemas, the researchers note. For the past 15 years, multiplexes have been a common feature in more established cinema markets such as the U.S., UK and Germany. The construction boom has caught on over the past few years in other parts of Western and Eastern Europe, as well as in South America and Asia.

In the United States, the largest movie-going market, average ticket prices rose for a 10th straight year to $6.04, climbing 45 percent over the decade, Screen Digest said.

The economics of movie ticket prices is not easy to pinpoint. Screen Digest points out that in Germany a variety of factors from a poor economy to lackluster box office attendance forced movie ticket prices down 2.6 percent year-on-year.
http://www.nytimes.com/reuters/arts/...e-tickets.html


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United Kingdom: The Sting-An Insider’s Guide To Film Piracy
Mark Endemano, Ed Shedd and Jolyon Barker

Piracy comes in two guises – hard copy (physical goods) and soft copy (electronic files). Press and check discs are one of the largest sources of pirated films.

Hard copy piracy, e.g. DVDs copied in Asia or Russia and made available on the black market, has been prevalent for years. It is largely controlled by organised crime, with black market distributors able to press and ship DVDs from Asia for less than $1.

There are a number of ways this pirated copy is obtained:

· Cinemas:Films in a cinema are recorded with a digital camera that can then be easily copied to DVD, VHS or VCD format (or posted on the internet for download). This is normally the worst quality pirated product.

· Screeners:This is the most common form of piracy. Screeners (with a time code burnt in) are commonly sent out to territories for audio dubbing and subtitling. These are sometimes obtained by pirates and copied onto all formats, including DVD.

· Digi-mastersigi-masters are similar to screeners but are of higher quality. Normally passed on from company insiders or third party affiliates.

· Press and check discs:These are the sample discs sent to the press and DVD industry insiders. They are similar to the finished product but lack the label and sleeve art and packaging. These often end up being pirated.

· Parallel imports:When territories release on different dates, territories within the same geographic region (and with the same DVD encrypted region code, e.g. Latin America, region 4) run the risk of having the finished product (pirated or legal) from a neighbouring country being imported in advance of the official release.

· Copies of legally obtained DVDs: These are purchased on the open market and reproduced to distribute on the internet or as copied discs. This form of piracy particularly causes damage to the home video market.

Soft copy pirating is a newer threat. It consists of copying and distributing pirated content via the internet in the following formats:

· Peer-to-peer technology (P2P): A type of network that allows users to access parts of each others’ hard drives, enabling files to be copied from one computer to another. Unlike the client/server model, content is stored in the user’s PC, which makes it difficult to discover and disable pirate sites.

· Streaming media:Sound (audio) and pictures (video) that are transmitted on the internet in a streaming or continuous fashion, using data packets. The most effective reception of streaming media requires some form of broadband technology.

· Internet relay chat:A system for internet chatting where users exchange information and digital content in realtime to one another.

· File transfer protocol (FTP):Allows users to download files from other computers on the internet. This can be a simple way to distribute content to a defined number of users.

http://www.mondaq.com/i_article.asp_Q_articleid_E_26869


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Peer-to-Peer File-Sharing Risks Can Be Better Disclosed
ByteEnable

The Federal Trade Commission today told a Senate Subcommittee that, although peer-to-peer

(P2P) file-sharing technology has benefits, it can create risks to consumers and some consumers may not be aware of these risks. Speaking to the Senate Commerce Committee’s Subcommittee on Competition, Infrastructure, and Foreign Commerce, Howard Beales, Director of the FTC’s Bureau of Consumer Protection, said the agency will work with the P2P file-sharing software industry to improve risk disclosures to consumers.

Beales called P2P file-sharing a neutral technology and said that P2P file-sharing programs can increase the speed and reduce the cost of file downloads.

The FTC testimony warns that when consumers download P2P file-sharing software, they may also be downloading other unwanted software, including spyware. The testimony notes that the agency is conducting non-public investigations concerning potential unfair or deceptive practices in connection with the dissemination of spyware.

According to the testimony, there may be other risks as well. “Consumers may inadvertently place files with sensitive personal information in their directory of files to be shared,” it says, thereby giving others access to their personal information. “Consumers may receive files with viruses and other programs that could impair the operation of their personal computers. Consumers may receive or redistribute files that may subject them to civil or criminal liability under laws governing copyright infringement and pornography. Because of the way the files are labeled, individuals, including children, may be exposed to unwanted and disturbing images. The Commission is concerned with the exposure of individuals, especially children, to unwanted pornographic materials through deceptive practices,” the testimony says.

Beales said that the FTC has reviewed disclosure statements on the Web sites of the ten most popular P2P file-sharing software programs to determine whether the program distributors misrepresent the risks associated with P2P file-sharing. “None of these representations appear on their face to be false or misleading,” the testimony says.

“Nevertheless, distributors of P2P file-sharing programs do not appear to be providing as much risk information about their products as they could or providing risk information as clearly and conspicuously and they might,” the testimony says.

According to the testimony, the Commission staff will work with industry to improve disclosure statements. “A P2P file-sharing software industry trade association recently wrote to the Commission to report that its member companies have a ‘desire . . . to act responsibly, to improve their products and to offer consumers a high-quality experience.’ We will encourage industry members to make good on this offer by improving their disclosures of risk information to consumers.”

The Commission vote to approve the testimony was 4-0, with Chairman Timothy J. Muris not participating.

An FTC publication, “File-Sharing: A Fair Share? Maybe Not” provides tips for consumers about the risks of file sharing. It is available online.

Copies of the testimony are available from the FTC’s Web site at www.ftc.gov and also from the FTC’s Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580. The FTC works for the consumer to prevent fraudulent, deceptive, and unfair business practices in the marketplace and to provide information to help consumers spot, stop, and avoid them. To file a complaint in English or Spanish (bilingual counselors are available to take complaints), or to get free information on any of 150 consumer topics, call toll-free, 1-877-FTC-HELP (1-877-382-4357), or use the complaint form at http://www.ftc.gov. The FTC enters Internet, telemarketing, identity theft, and other fraud-related complaints into Consumer Sentinel, a secure, online database available to hundreds of civil and criminal law enforcement agencies in the U.S. and abroad.
http://www.linuxelectrons.com/articl...40623153836280


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RIAA Files Suit Against Another 482 Alleged File-Traders
Jay Lyman

RIAA spokesperson Jonathan Lamy told TechNewsWorld that while some have many more and others have fewer, the average number of songs made available by those being sued is approximately 800. "We continue to target the substantial offenders -- those who are sharing or distributing hundreds and hundreds of songs on a P2P network," Lamy said.

The Recording Industry Association of America (RIAA) this week continued its legal campaign against online file-traders who use peer-to-peer (P2P) song-swapping networks. In the latest move to stem the flow of pirated music, the RIAA has taken legal action against another 482 individuals across the country.

The RIAA, which now has taken legal action against more than 3,400 people since suits began last September, has settled with approximately 600 of those individuals, who are not being named in the latest round of so-called "John Doe" cases, where the identity of the alleged infringer is not disclosed until there is a hearing.

Prior to the RIAA suits this year, the recording industry group was securing subpoenas on alleged file-traders and serving them to ISPs who would then match infringing Internet addresses to individuals.

There is agreement among experts that the campaign has been effective in discouraging free P2P use, but analysts also say there has been a negative effect on enthusiastic music listeners who simply want to explore and search out new and different music.

Cases Continue

When the lawsuits began last fall, RIAA officials said the most egregious offenders were the first to be sued for copyright infringement.

RIAA spokesperson Jonathan Lamy told TechNewsWorld that while some have many more and others have fewer, the average number of songs made available by those being sued is approximately 800.

"We continue to target the substantial offenders -- those who are sharing or distributing hundreds and hundreds of songs on a P2P network," Lamy said.

The RIAA said its latest round of legal action involved 213 individuals in St. Louis, 55 in Denver, 206 in Washington D.C. and eight in New Jersey.

Getting Less Scary

Although the lawsuits have continued consistently with new alleged copyright infringers every month or two, the initial fear of RIAA legal retribution has subsided somewhat, according to Pew Internet and American Life Project research specialist Mary Madden.

"What we've seen is there was an initial reaction and people are realizing there are other ways they can skirt around this tracking," Madden told TechNewsWorld.

Analysts also have been drawing attention to non-P2P sources of song swapping that increasingly includes e-mail and instant messaging , as well as newsgroups and other community sites.

Chilling Effect

Madden said the RIAA lawsuits have no doubt had an effect on P2P use, but the extent to which people are returning or using other means to trade music online is unknown.

Madden also said there are other factors, primarily fear of viruses, that have turned people away from the free file-sharing services.

However, along with discouraging people from accessing P2P, the RIAA campaign might also be discouraging use of legitimate services -- such as Napster 2.0 or iTunes -- by those new to online music, according to Madden.

"The chilling effect of the lawsuits is being felt not only by current downloaders, but also by people who are not yet downloaders," Madden said. "There's the potential of people being scared from using the legitimate services."
http://www.linuxinsider.com/story/34701.html


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File-Trading Bill Stokes Fury
Joanna Glasner

A new Senate bill aimed at punishing companies that encourage people to steal copyright materials met with a deluge of criticism from file-trading companies and tech industry groups that believe it could hamper development of new technologies.

Sponsored by Sen. Orrin Hatch (R-Utah), the Inducing of Copyright Infringement Act of 2004 would, in the senator's words, "simply confirm that existing law would allow artists to bring civil actions against parties who intend to induce others to infringe copyrights."

In a prepared statement, Hatch compared peer-to-peer networks, which allow people to exchange any digital content over their computers, to villains of literature and film, including a character in the movie Chitty Chitty Bang Bang who lured youngsters into danger with false promises of free lollipops. He said the networks should be held liable for creating technologies that enable often unwitting consumers to house pirated materials on their computers.

The Induce Act is the latest in a series of bills favorable to the music and motion picture industries introduced by Hatch, who co-authored the controversial 1998 Digital Millennium Copyright Act and introduced legislation in March that would allow the Justice Department to pursue civil cases against file sharers. In the past five years, Hatch has also received $158,000 in campaign contributions from the television, movie and music industries, according to the Center for Responsive Politics.

Hatch's bill enters the political fray as a panel of federal appeals judges in California continues to deliberate on a case filed by the recording industry challenging the legality of two of the most popular file-trading networks. The judges' decision, expected any day, will follow a lower court ruling that the two networks, Grokster and Morpheus, should not be held liable for copyright infringement committed by their users. That ruling, made last year, spurred the recording industry to file lawsuits against individual file traders rather the P2P networks they used.

Adam Eisgrau, executive director of P2P United, a group representing the file-trading industry, believes the Induce Act is an attempt by the recording industry to mute the unpleasant ramifications of a likely appeals court loss.

"It's a stealth maneuver intended to circumvent a line of cases emerging that peer-to-peer software is indeed legal to design, to make available and to use, on a case-by-case basis, depending on what you use it for," Eisgrau said. He characterized the Induce Act as an example of "big entertainment pulling big strings."

Fred von Lohmann, an attorney with the Electronic Frontier Foundation, said he's concerned that the bill could harm companies that seem to have nothing to do with illegal file trading. Looking at the legislation, he said, one could arguably make a case that any device that could be used to store or play illegally obtained files could be targeted in a lawsuit.

"If this bill were law, I could easily imagine suing Apple the very next day for inducing infringement for selling iPods," von Lohmann said.

Supporters of the Induce Act will likely have a hard time convincing a majority of the Senate to go along, said Gigi Sohn, president of the technology policy group Public Knowledge, who predicts a battle royal over its passage between the recording and computer technology industries.

For her part, Sohn believes the bill would essentially "take the guts out of" a legal standard that has been used over the last two decades to determine whether a technology developer can be held liable in infringement cases. That standard, upheld in a landmark Supreme Court ruling in a suit challenging the legality of the Sony Betamax, states that technologies that can be used for copyright infringement but also have substantial non-infringing uses do not violate the law.

"This (new) bill applies to all technologies, whether it's hardware or software. It doesn't make a difference whether your technology has substantial non-infringing uses," Sohn said. Theoretically, makers of devices with a broad variety of uses, including computers and copying machines, could be held liable for inducing infringement.

Another problem with the bill, said Will Rodger, director of public policy at the Computer and Communications Industry Association, which is pressing to block its passage, is that its authors do not provide a clear definition of what constitutes inducement.

"As we read it, reporters who wrote about peer-to-peer file-trading networks could well be charged with inducing infringement," he said. "Their definition of inducement seems to cover almost anything."
http://www.wired.com/news/business/0,1367,63969,00.html


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Going Hollywood: DOJ Joins File- Sharing Fight
Vanessa Blum Legal Times

After years of agitating over Internet piracy and spending millions of dollars to press their case in Washington, the entertainment and software industries have gained a powerful ally: the U.S. Department of Justice.

With just months until the presidential election that could end his term in office, Attorney General John Ashcroft has launched an ambitious effort to crack down on digital piracy and protect the interests of copyright holders. The initiative is led by Ashcroft's deputy chief of staff, David Israelite, who chairs a newly formed task force on intellectual property issues.

The high-level task force, which includes a dozen influential DOJ and Federal Bureau of Investigation officials, will draft plans to revamp federal law enforcement's approach to IP matters, including widespread file sharing over peer-to-peer networks.

Task force members will consider whether the Justice Department should take the lead role in going after online file-swappers -- individuals who share copyrighted material across the Internet. Tactics being considered include ramping up criminal prosecutions and filing civil lawsuits similar to those now being brought by the recording industry.

Not surprisingly, the DOJ task force has been applauded by industry groups, many of which have spent millions to deter online file swapping. But critics complain that the Justice Department may be overstepping its appropriate role by championing the interests of a powerful industry that some think can take care of itself.
http://www.law.com/jsp/article.jsp?id=1087855513203


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Euro iTunes Downloads Top 800K in First Week
Blane Warrene

These recent movements in the European digital music market is transforming the music industry as a whole, said GartnerG2 senior analyst Mike McGuire, who added that initial concerns, such as the price of iPods and the single format support of the iTunes Music Store has been unfounded.

Apple, moving quickly to repeat its U.S.-based leadership in legal online music distribution, announced Wednesday that it has sold 800,000 songs through the European wing of its iTunes Music Store during its first week of business.

"In the UK alone, iTunes sold more than 450,000 songs in the last week, 16 times as many as [On Demand Distribution] OD2, its closest competitor." Apple CEO Steve Jobs crowed in a press release.

Meanwhile, dissed iTunes rival OD2 had a big announcement of its own: on Tuesday, digital media solutions provider Loudeye purchased OD2 for US$20.7 million. This acquisition will double the revenues and reach of private-label digital music services across Europe and in Australia for Loudeye and OD2 clients.

Apple's Marketing Might

These recent movements in the European digital music market is transforming the music industry as a whole, said GartnerG2 senior analyst Mike McGuire, who added that initial concerns, such as the price of iPods and the single format support of the iTunes Music Store has been unfounded.

"The people who are using online music -- early adopters -- are just not as price sensitive and will want increased storage for their music," McGuire told MacNewsWorld. "Apple is offering this."

McGuire explained that marketing has played a bigger role in Apple's ascension than the technology. While competitors like Samsung offer similar features and functionality, they are not garnering the same attention.

"This is about a rich-media strategy, one where music, videos and games are sold online, and companies are seeing this industry in that light," McGuire continued. "There is a reason why Nike has the monstrous advertising budget they have. Apple is doing the same by also investing in marketing their own brand."

On learning that Napster failed to respond to MacNewsWorld's request for comments about Apple's announcement, McGuire expressed disgust.

"You would think they would have called yesterday," he said. "They all should want to tell their story and differentiate themselves, especially with Apple selling in a week what might take them months to sell."

Don't Forget the Tech

For his part, Loudeye CEO Jeff Cavins told MacNewsWorld that technology holds comparable significance in the online music marketplace as does marketing.

"Unfortunately, the most successful in digital media remains [illegal] peer to peer file sharing. Kazaa alone has a 30-billion file catalog, in contrast to a worldwide market for recorded music at around $32 billion," Cavins said.

Moreover, Cavins contended that a company's marketing perspective varies, depending on its motivations. "Sony is in it purely to drive business to their consumer electronics and could care less if they make money, [while] Apple equally wants to drive up iPod sales," said Cavins. "Napster, on the other hand, is in this business purely to make money from its music."

The Pepsi Challenge

According to Cavins, the online music spaces stretches beyond the music itself, citing branding as a major factor. The recent Pepsi-Apple promotion, for example, demonstrated that Pepsi had served to strengthen Apple's brand because consumer traffic was directed toward the U.S iTunes Music Store.

Coca Cola faced a similar challenge in Europe, because of social and cultural dividers in consumer adoption of Coke, Cavins said. To help win those buyers back, the company launched mycokemusic.com.

"Now on a Coke can in the UK, 70 percent of the can's real estate is covered with promotions for mycokemusic.com," Cavins explained. "And when someone buys a case of Coke they assume they might win a few songs and are driven to a Coca Cola-branded property."
http://www.macnewsworld.com/story/technology/34713.html


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Connected Comment: Apple Bites Back At Pirates
Dominic White

'No Elvis, Beatles or the Rolling Stones," sang The Clash on their debut single in 1977. The legendary punks were rebelling against the rock aristocracy of the time, but their memorable lyric might just as well be applied today to Apple's online music store, iTunes.

The only member of rock's holy trinity that you will find on the US computer giant's UK service, launched last week with trademark American hype, is the King. Even then, you'll only get one album from 1969. It was hardly his heyday.

But perhaps this is just nitpicking. iTunes has a vast catalogue of music, with 700,000 songs on offer, and its relative simplicity makes the process of downloading tunes far less painful than using "illegal" file-sharing services.

Launching iTunes into Europe last week, Apple's founder Steve Jobs admitted to having tried out the services of his outlaw rivals "in the name of research". He's such a card, but he had some serious points to make about the problems you can encounter when you download illicitly.

The services are often unreliable. Downloads can be painfully slow or "crap out", as Mr Jobs so charmingly put it, before the song ends. You might also find that the file was encrypted by a 10-year-old who managed to cut off the last four seconds of the song.

The core of Apple's mission has been to come up with a service that is better than those on pirate sites, which Mr Jobs identified as his biggest competition. The record companies should take note, having chosen instead to pursue the teenage pirates through the courts, while failing to launch decent services themselves in fear of cannibalising precious CD sales.

iTunes, previously only available to people with a credit card and a US billing address, offers several things the pirate sites cannot: one-click downloads, one-click CD burning, free print-outs of album cover art work and notes and exclusive tracks from certain artists.

It has also copied some of the pirates' best ideas such as the ability for users to pick and mix their music track by track.

That is not to say iTunes is niggle-free, particularly if you are a UK user. When Mr Jobs last week revealed that it would cost Germans 99 cents to download a track, a Teutonic cheer went up in the vast conference hall. Small wonder, when you discover that UK users will have to pay far more.

Our 79p charge is equivalent to 1.20 or $1.44, making it almost 50pc more expensive to download a track than it is across the pond, where the charge is 99 US cents. Why did Mr Jobs feel it necessary to penalise his UK customers so?

Perhaps because, even at UK prices, he is likely to make a loss, particularly on so-called crown jewel acts such as Robbie Williams. In reality the real profits are likely to come from the vast number of iPods that Apple is betting it can sell on the back of the iTunes service.

The iPod, which allows you to squeeze a lifetime's music into a white gizmo the size of a cigarette packet, is the only digital music player that you can download your iTunes to (unless you are a complete techno whizz).

Mr Jobs says the company can't make the gadgets fast enough. And while you can only transfer the tracks you have downloaded from iTunes to four other computers, you can download them again onto an unlimited number of iPods.

It sounds like a nascent plan for world domination along the lines of Microsoft's promotion of its Windows operating system. If successful, it too will become a business school classic.

The matter might even attract the attention of the anti-trust regulators, given that Mr Jobs already claims to have cornered 70pc of the US market for legal music downloads.

He may have a harder task getting to that level of domination in the UK, where Peter Gabriel's 0D2, and the now-legal Napster have a head start on him.

But his toughest job will be persuading an entire generation that has grown up with the idea that music comes for free to start paying for the privilege. Without the support of independent record labels that look after cutting edge artists such as the White Stripes and Franz Ferdinand, iTunes will struggle to attract such an audience.

If, as some observers are suggesting, Mr Jobs is playing bully-boy tactics with the independent labels, he risks alienating the very audience he is so desperate to seduce.
http://www.telegraph.co.uk/connected.../ecntconc2.xml


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ATTENTION ALL UNITS! BE ON THE LOOKOUT FOR NEWSPAPER PROPAGANA.

Peer-To-Peer Files

Movies can be found through peer-to-peer file-sharing programs, such as Kazaa and Limewire, but none are legal, despite the claims to the contrary. Many Web sites that make such claims charge membership fees, but none of the money goes to the studios that own the film.

Peer-to-peer file sharing also comes with a host of technical problems; files often are corrupted, incomplete or infected with viruses. Some mask pornography behind mainstream titles.

Jenna Martin, 16, of Alexandria, said she has experimented with peer-to-peer movie downloads and has been disappointed with the results. "Kazaa has done a number on my computer and tends to crash it regularly," she said.

http://www.enquirer.com/editions/200...ede20peer.html


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Failing to Draw Big Players, Computer Show Is Canceled
John Markoff

This year's Comdex, the fall computer event that was once the nation's largest trade show, was canceled Wednesday as its owners cited the failure of the industry's largest companies to participate.

Executives at MediaLive International, the company that owns Comdex and other trade shows, said they decided to redefine the event and were hoping that it would re-emerge after a year's hiatus.

Created in 1979 by Sheldon Adelson, a Boston financial consultant, Comdex rapidly gained prominence in the early 1980's with the emergence of the personal computer industry.

The annual show became the place to showcase new computers and software, and a mandatory stopping place for industry luminaries.

Executives would flock to Las Vegas to hear a speech on the future of computing by Bill Gates or to visit a booth where Mitchell D. Kapor introduced the Lotus Development Corporation's Lotus 1-2-3 spreadsheet program.

"I remember walking down an aisle at Comdex with Gates and watching the crowd part like the Red Sea making way for Moses," said Stewart Alsop, a Silicon Valley venture capitalist who edited Infoworld, a personal computer industry newspaper, during the 1980's.
http://www.nytimes.com/2004/06/24/te...gy/24show.html


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Tech Heavies Support Challenge To Copyright Law
Declan McCullagh

The copyright cold war between Hollywood and Silicon Valley is about to heat up.

Skirmishes between content-producing companies seeking expansive copyright protections and hardware and telecommunications corporations on the other side have resulted in a legislative deadlock on Capitol Hill.

Some of the most influential technology companies are planning to announce on Tuesday an alliance that they hope will end the impasse. Called the Personal Technology Freedom Coalition, its purpose is to coordinate lobbying efforts in opposition--at least initially--to the most controversial section of the Digital Millennium Copyright Act.

Currently, that controversial section of the DMCA broadly says no one may bypass a copy-protection scheme or distribute any product that is "primarily designed or produced for the purpose of circumventing" copy protection. The movie industry, record labels and many software publishers are fiercely protective of that section of the law, saying that digital rights management, or DRM, systems backed up by the law are necessary to reduce piracy.

But members of the nascent coalition, including Intel, Sun Microsystems, Verizon Communications, SBC, Qwest, Gateway and BellSouth, are lending their support to a proposal by Rep. Rick Boucher, D-Va., to rewrite that part of the DMCA. Boucher's bill says that descrambling utilities can be distributed, and copy protection can be circumvented as long as no copyright infringement is taking place.

One participant in the coalition, who spoke on condition of anonymity, said its members already have met with representatives of more than 20 congressional offices. Their sales pitch: Beyond harming "fair use" rights, the DMCA also endangers computer research vital to national security.

Other members of the coalition include: Philips Consumer Electronics North America, the Consumer Electronics Association, the American Library Association, the Electronic Frontier Foundation, Consumers Union, the Consumer Federation of America, Public Knowledge, the American Foundation for the Blind, the United States Telecom Association, and the Computer and Communications Industry Association.

Boucher's bill, called the Digital Media Consumers' Rights Act, would also grant the Federal Trade Commission new authority to regulate copy-protected compact discs. It gives FTC bureaucrats the power to police music sales by ensuring that copy-protected discs are labeled as such and are not simply called "CDs," which could be misleading to consumers. Such labels would have to say that the copy-protected discs might not play properly in standard CD players, and that they might not be recordable on PCs or other devices that can record standard CDs.
U.S. record labels have been slower than their European and Asian counterparts to add copy locks to releases in the American market, fearful of consumer backlash and complaints about incompatibility. But the top seller in last week's stores, the debut album by hard rock act Velvet Revolver, was wrapped in antipiracy technology.

Industry insiders said the album's success despite prominently displayed stickers warning that it was "protected against unauthorized duplication" was likely to lead to more copy-protected releases in the United States. Still, earlier this month, Universal Music decided to stop adding the technology to discs sold in Germany, according to Billboard magazine, a potential sign that regulations regarding labeling could discourage some record companies from using DRM for fear of losing buyers.

Regardless, Boucher's drive to grant the Federal Trade Commission new authority to regulate copy-protected discs with labels has drawn criticism from at least one group that otherwise applauds Boucher's goal of amending the DMCA. The free-market Cato Institute, which convened a conference that Boucher spoke at last week, called the proposed FTC powers another big government power grab.

"Bringing in the government to impose certain types of mandatory labeling schemes or new technological mandates is a little bit troubling to us," said Adam Thierer, Cato's director of telecommunications studies. "A lot of this seems to be an anti-DRM backlash that's developed as part of the Boucher bill. We've had groups say that DRM is the devil, that by locking up content, private interests have gained too much control over copyright."

To Thierer, it's far better to treat the race to scramble and descramble content as a kind of market competition that should be unfettered by the DMCA--or new FTC rules: "The better approach is to let content owners lock up their work, but (to) take away the advantage that the DMCA gives them."
http://news.com.com/2100-1028-5242774.html


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U.S. Copyright Bill To Curb Online Piracy Is Attacked As Too Broad
Matt Richtel and Tom Zeller Jr. NYT

A copyright bill introduced in the Senate this week is raising a chorus of criticism from representatives of the telecommunications and electronics industries, who contend it could make computer companies, Internet providers and other technology businesses liable for software piracy.

But supporters of the bill, including its bipartisan sponsors, say it would provide a powerful tool to curb illegal copying of music files and other media and would protect children from the lure of a technology that is designed to help them break the law.

The legislation, introduced on Tuesday, is the so-called Induce bill, which would make liable anyone who "intentionally aids, abets, induces or procures" a copyright violation. It is aimed primarily at the makers of file-sharing software, which is used to trade copies of digital files over the Internet.

But critics say that the bill's language is too broad and that it amounts to a fundamental undoing of a 1984 Supreme Court decision that has protected companies developing legal technologies that can be abused by users.

"It's a very powerful, blunt instrument that can be used to threaten and intimidate industries that copyright owners disagree with," said Sarah Deutsch, associate general counsel for Verizon Communications.

Echoing the concerns of other critics, Deutsch added that the Senate Judiciary Committee appeared intent on passing along the bill to the full Senate without holding hearings first. "What's disturbing is that this is a dramatic sea change to copyright law, but there have been no discussions or hearings," Deutsch said. Sponsors of the bill, however, insisted that such concerns were overblown. The chairman of the Judiciary Committee, Senator Orrin Hatch, Republican of Utah, who co-sponsored the bill along with the committee's ranking Democrat, Patrick Leahy of Vermont, said the law would simply cut off a revenue stream for companies that were knowingly providing tools to commit crimes.

"These corporations know better than to break the law themselves, so they profit from infringement by inducing users of their software to do the 'dirty work' of actually breaking the law," Hatch said.

Hatch also said the bill was meant to defend children, who he said made up about half of the users of file-sharing software. "This for-profit piracy scheme mostly endangers children, who are ill equipped to appreciate the illegality or risks of their acts," he said. The legislation is the latest development in the continuing battle between copyright holders and the makers of computers and digital recording devices that can be used to violate intellectual property laws. The file-sharing network Napster, which effectively was shut down in 2002, was one of the first to be aggressively challenged in the courts.

More recently, the record industry began suing individuals, including children, who use file- sharing networks to trade copyrighted files, and a suit brought by MGM against three peer-to- peer software products - Grokster, Morpheus and Kazaa - is pending in federal court.

Mitch Bainwol, chief executive of the Recording Industry Association of America, an industry lobbying group, said the legislation was meant to be narrowly tailored to address companies that build technology focused on illegal file sharing.

He said he did not envision the legislation enabling lawsuits against "neutral" technologies, like computer makers.

"This is not about going after the device makers," Bainwol said, though he stopped short of guaranteeing that the recording industry would never use the measure to sue them.
http://www.iht.com/bin/print.php?file=526360.html


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RIAA Legal Settlement Short On Treasures
Candace Heckman

Listening to oldies such as "Mr. Bojangles" and "What's Going On?" might be a fun music history lesson for school kids in King and Pierce counties.

But 413 free copies of "Greatest Hits 1971" might prove to be too much of a good thing.

And 387 CDs containing explicit lyrics by the late Puerto Rican rapper Big Punisher, along with 356 copies of "Staying Power" by the late Barry White, weren't high on the public schools' wish list.

Raunchy music wasn't what anyone in education or the Attorney General's Office had in mind when they announced that a windfall of music was coming to public schools and libraries from last year's $143 million anti-trust settlement with the recording industry. The industry was accused of setting artificially high prices.

Washington got 115,241 music CDs -- which would retail at $1.5 million -- out of the deal. Boxes of free music began hitting schools and libraries last week.

But some teachers are not sure what they will do with, for example, 114 copies of Meredith Brooks' "Blurring the Edges," which includes the Grammy-nominated song, "Bitch."

"There were truly some gems in there," said Karen Farley, a library media specialist for the Puget Sound Educational Service District. "It's just that some of them, you'd look at and scratch your head."

Farley's regional district, which covers 35 school districts, received 1,355 copies of Whitney Houston singing "The Star-Spangled Banner." The hit single, which Houston sang before the 1991 Super Bowl at the height of the Gulf War, was 5 percent of the district's cache.

Washington was the first state to receive its share of CDs, and the national settlement administrators discovered mistakes when they calculated the distribution, said Gary Larson, spokesman for state Attorney General Christine Gregoire.

The Secretary of State's Office this week set up a CD-swapping listserve for librarians and administrators, said Karen Goettling, with the state library system.

"I'm sure that there are other, smaller libraries that wouldn't mind one or two copies of some of those CDs," she said.

Larson said larger recipients, such as the Puget Sound ESD, which received 25,600 CDs, and the Tacoma Public Library, which received 1,325 CDs, are having the most problems with the variety. Libraries and schools that received about 100 or fewer titles seem to be more pleased with the selections, he said.

He said his office was unaware that schools had received titles featuring explicit lyrics, with albums clearly marked with the black-and-white parental advisory sticker.

In her announcement of the distribution two weeks ago, Gregoire said schools would not receive music with adult content.

Most of the free CDs distributed in Washington went to the public schools.

Although she was surprised by some inappropriate music, "I'm glad that the schools were even considered," said Cynthia Schultz, director of learning resources for the Northwest Educational Service District, which covers counties from Snohomish to San Juan.

"Whether or not we considered it 'good' was irrelevant," Schultz said. "There was a whole collection of Gene Autry albums. My husband would've given his eyeteeth for those."

Too busy organizing their new digs, officials at Seattle Public Library didn't open theirs until yesterday, said library spokeswoman Andra Addison.

Included in the shipment: 84 copies of an album by rhythm-and-blues artist Samantha Mumba, 69 by Lenny Kravitz and 48 copies of "Scary Sounds for Halloween" from Martha Stewart.

With 23 branches, the Seattle Public Library received many more copies of albums it can use, but officials don't know what they will do with the extras.

The King County Regional Library System already has decided to try to hock its gifts, all 7,700 of them.

"We didn't feel they were up to snuff to be added to our collection," said library spokeswoman Julie Wallace. King County donated the CDs to its fund-raising foundation to sell.

Wallace said she is not sure what kind of music the library system got, but heard "there were a lot of Gregorian Chants."

Part of the settlement the recording industry made with states' attorneys general was that the giveaway CDs couldn't be junk, Larson said. Titles had to be on a Billboard chart for at least 26 weeks and had to peak in the top half of the chart.

To their credit, Schultz said, the music labels included what she considered good recordings, such as classical music, newer Carlos Santana collections and the soundtrack to "The Rocky Horror Picture Show."

Tacoma librarian Lara Weigand said she remains skeptical about the sincerity of the recording industry in sending the CDs to Washington, that the type and volume of some music seemed like the record labels were cleaning house.

"There were several that were clearly marked, 'For Promotional Use Only,' " she said. Tacoma Public Library received dozens of CDs that were notched, indicating that they were not resalable.

Included in Weigand's haul: "an abundance of Christmas music," 27 copies of Madame Butterfly and 35 copies of the Bee Gees "This is Where I Came In."
http://seattlepi.nwsource.com/local/...dupdate24.html
















Until next week,

- js.














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