Peer-To-Peer News - The Week In Review - July 14th, '12

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"I want to see proof!" – Jérémie Zimmermann


"I think we didn’t help ourselves down in Southern California by trying to jam something in Congress; we screwed that up." – Ari Emanuel



































July 14th, 2012




File-Sharing Site Owner Arrested for Selling Database in Italy

The former operator of Italianshare.net, one of Italy’s largest unlicensed music services, has been arrested by the country’s fiscal police on suspicion of selling a database containing his users’ email and IP addresses.

IFPI, which represents the recording industry worldwide, has welcomed the move which it claims highlights the illegal business models behind some well-known unlicensed music services.

Italianshare.net and four affiliated websites were originally closed down in November 2011, following action by the Guardia di Finanza (GdF). The authorities then investigated the ways in which the illegal businesses had generated revenue, leading to today’s arrest made by officers from the Tax Police Force of Agropoli.

Investigators found that the operator had made an estimated €580,000 through a mixture of charging for advertising revenues, seeking donations from users and selling the database containing those users’ email and IP addresses to several advertisers.

The operator of the site now faces charges of breaching data privacy, facilitating copyright infringement, forgery, fraud and tax evasion. It is believed he has avoided €83,000 in VAT payments and created false invoices totalling an estimated €100,000 as part of a tax fraud. He will also face heavy administrative fines for the distribution of copyrighted works estimated at up to €32 million in value. Five others have also been charged for multiple offences including tax fraud and counterfeiting.

Frances Moore, chief executive of IFPI, said: “This investigation throws a spotlight onto the illegal business models behind high-profile unlicensed services that are generating revenue and avoiding taxes on a grand scale. I welcome the efforts of the authorities in Italy to tackle this problem and urge governments and law enforcement agencies elsewhere to show similar vigour in curbing illegal activity online.”
http://www.musicweek.com/story.asp?s...de=1050352&c=1





U.S. Pursuing a Middleman in Web Piracy
Somini Sengupta

Richard O’Dwyer, an enterprising 24-year-old college student from northern England, has found himself in the middle of a fierce battle between two of America’s great exports: Hollywood and the Internet.

At issue is a Web site he started that helped visitors find American movies and television shows online. Although the site did not serve up pirated content, American authorities say it provided links to sites that did. The Obama administration is seeking to extradite Mr. O’Dwyer from Britain on criminal charges of copyright infringement. The possible punishment: 10 years in a United States prison.

The case is the government’s most far-reaching effort so far to crack down on foreigners suspected of breaking American laws. It is unusual because it goes after a middleman, who the authorities say made a fair amount of money by pointing people to pirated content. Mr. O’Dwyer’s backers say the prosecution goes too far, squelching his free-speech right to publish links to other Web sites.

Mr. O’Dwyer did not respond to requests for an interview, but his mother, Julia, a nurse with the state-run health service, described him as a somewhat reserved young man who grew up playing Super Mario games on his computer and became devoted to coding. He studies interactive media and animation at Sheffield Hallam University and, his mother said, long ago spent the money he had made from his Web site.

“He would take his mates to the cinema and pay for them,” she said.

No matter how Mr. O’Dwyer’s legal problems are resolved, the case against him reflects the complexities of wrestling with piracy in the digital age.

The entertainment industry lobbied Congress hard for the Stop Online Piracy Act, or SOPA, which was withdrawn this year after an online uproar led by Web companies and their consumers. Another bill on Capitol Hill would establish intellectual property attachés in American embassies. An international antipiracy treaty, the Anti-Counterfeiting Trade Agreement, or ACTA, was roundly rejected last week by the European Parliament.

In the last two years, the Obama administration has closed about 800 Web sites suspected of piracy, including those that stream new Hollywood films. In a widely publicized case, the Justice Department has sought to extradite the operators of Megaupload, a site that let users anonymously share movies and music, on criminal copyright infringement.

“There is a problem of copyright infringement on the Internet, and copyright owners have been struggling over how to deal with that,” said Mark A. Lemley, a Stanford law professor who has represented Internet companies like Google in intellectual property disputes. “The U.S. government is aggressively getting involved in turning what used to be civil lawsuits into criminal cases. The combination of that and reaching across the border is new.”

The extradition case against Mr. O’Dwyer has turned him into something of a cause célèbre. Wikipedia’s founder, Jimmy Wales, is leading a crusade to save him, with an online petition that has gathered over 225,000 signatures worldwide in two weeks.

Still, the British home secretary, Theresa May, approved the extradition order in March and said Monday that she would let the order stand. Mr. O’Dwyer has appealed; a hearing in Britain is expected this fall.

His lawyer did not respond to requests for comment. The federal prosecutors in New York who are handling the case also declined to comment. The criminal complaint against Mr. O’Dwyer is sealed.

Mr. O’Dwyer’s story began in 2008 when he set up his Web site, TVShack.net, which allowed users to search for and link to other sites, including ones that the authorities say showed pirated movies and shows. Because the domain name was registered in the United States, it fell under the ambit of American law. The government shut down TVShack.net in summer 2010.

Mr. O’Dwyer was unbowed. TVShack.net had been growing in popularity, and it made about $230,000 from advertising over the course of two years, federal prosecutors say.

“America? They have nothing to do with me,” Mr. O’Dwyer’s mother said he had told her. He reopened his site as TVShack.cc, which he reckoned was beyond the reach of the United States.

A few months later came a knock on the door from the British police. A judge ruled that Mr. O’Dwyer would not be prosecuted in Britain. Instead, the United States would seek to extradite him.

His mother was stunned. “This is for fugitives and murderers and terrorists,” she recalled thinking. “Richard has never fled the scene of a crime. He has never left the U.K.!”

A judge released Mr. O’Dwyer on bail. On his mother’s orders, he shut down his site, which makes it difficult to tell how it operated.

At the heart of the O’Dwyer case is a question of what to do about Web sites that help users find unlicensed content.

According to British court documents examined by The New York Times, the Justice Department argues that Mr. O’Dwyer enabled Internet users to easily avail themselves of copyrighted material by providing links to third-party sites that contained thousands of pirated films and television programs.

Prosecutors say that on one day in 2010, his Web site contained links to seven films, described as the “most popular movies today,” that were still playing in theaters and had not been authorized for distribution on the Internet.

Mr. O’Dwyer, prosecutors suggest, was aware the material was copyrighted. They cite an announcement on TVShack that urged users to be patient with download times because they were “saving quite a lot of money (especially when putting several visits to the theater or seasons together).”

Ted Shapiro, the Motion Picture Association of America’s general counsel for Europe, said the fact that Mr. O’Dwyer had not stored illegal material on TVShack itself signaled that he knew how to evade the law.

“The fact that the U.S. government is willing to step up and protect content from the film industry and the copyright sector is an amazingly important thing,” Mr. Shapiro said. “We are talking about protecting things Americans are good at.”

Mr. O’Dwyer’s backers say his site was effectively a search engine. To prosecute him, they argue, would set a dangerous precedent — tantamount to holding one person accountable for the acts of another.

“Something that lets you find illegal content can also help you find legal content,” said Mitch Stoltz, a lawyer with the Electronic Frontier Foundation. “When you go after intermediaries, you’re going to shut down legal and legitimate speech and commerce and innovation to get at what they perceive as illegal copyright violation.”

Peter Decherney, a professor at the University of Pennsylvania who wrote the book “Hollywood’s Copyright Wars: From Edison to the Internet,” said the O’Dwyer case showed how difficult Hollywood has made it for people in other countries to consume American entertainment online.

Sites like Netflix, Hulu and iTunes have limited offerings overseas, if any. The demand for American entertainment drives a lucrative underground economy of pirated movies and television shows.

“In many other countries, unauthorized distribution is the only form of online distribution,” said Mr. Decherney, “and consumers will continue to make Robin Hoods out of anyone who can help them get to media online.”
https://www.nytimes.com/2012/07/13/t...ne-piracy.html





Tech and Media Elite Are Likely to Debate Piracy
Amy Chozick

It’s not often moguls admit they made a mistake.

But lately some of the highest-paid executives at the world’s largest media companies have talked a lot about the lessons they learned from a failed industrywide attempt to pass antipiracy legislation six months ago.

In January, the technology industry led by Google, Facebook and Wikipedia revolted against two bills called SOPA and PIPA — short for Stop Online Piracy Act and Protect Intellectual Property Act. The legislation, largely the product of media companies to protect movies, television shows, video games and music against online theft from rogue foreign Web sites, sparked a reaction that quickly shifted from an arcane policy debate to an online consumer rebellion.

Wikipedia went black to protest SOPA and more than seven million people signed online petitions, many of which said the bills would “break the Internet.” Congress, overwhelmed by the popular opposition, quickly backpedaled, leaving the legislation to die.

“They tsunamied the conversation with rhetoric, and we were unprepared to fight back,” Tom Dooley, chief operating officer at Viacom, said of the technology industry. “We’re going to have to find a solution that works better for everyone.”

On Tuesday, the titans of both media and technology will convene in Sun Valley, Idaho, for an exclusive annual conference sponsored by the boutique investment firm Allen & Company. It will be the first time since the piracy debate went viral that top technology and entertainment executives will assemble en masse on neutral ground to discuss major issues affecting both industries.

“There’s an agreement on both sides that there should be some period of time when everyone steps back and reassesses,” said Michael O’Leary, a senior executive vice president for the Motion Picture Association of America.

The Sun Valley conference, known as “summer camp for moguls,” is off limits to reporters (though dozens still turn out) and famously private. In between bike rides, hikes and cocktail parties, the executives will hold meetings, listen to a variety of speakers and attend panel discussions with luminaries from sports to politics.

A preliminary list of attendees at this year’s conference includes Rupert Murdoch and Chase Carey, the chief executive and chief operating officer of News Corporation; Philippe Dauman, chief of Viacom; Jeffrey L. Bewkes, chief of Time Warner; and Mark Zuckerberg and Sheryl Sandberg of Facebook. Tim Cook, chief of Apple, and Google’s co-founder Sergey Brin are also expected to attend.

In the months since the SOPA debates, media executives have discussed piracy with obvious shell shock.

“I think we didn’t help ourselves down in Southern California by trying to jam something in Congress; we screwed that up,” Ari Emanuel, co-chief executive of the William Morris Endeavor talent agency, said at the All Things D conference in May. He added: “When SOPA died, a lot of conversations died. But they’ll start up again.”

In the aftermath, Hollywood has increased its efforts to get online payment companies, cloud services and Internet service providers to voluntarily help curtail pirated movies, TV and music, particularly from foreign Web sites.

Months before the debates erupted in January, American Express, Discover, MasterCard, PayPal and Visa agreed on a set of best practices to reduce the sale of counterfeited pirated goods. In 2010, Yahoo, PayPal, GoDaddy, Google and others formed a nonprofit intended to combat the sale of illegal pharmaceuticals online, one issue SOPA and PIPA were initially meant to address.

The Sun Valley conference could provide a tranquil backdrop for the continued construction of a fence between media and technology.

“We thought about what’s in the long-term interest of the Internet ecosystem. And that’s a set of best practices that people feel comfortable with,” said Cary Sherman, chief executive of the Recording Industry Association of America.

In January, Mr. Sherman said it was hard to negotiate with Google when the company is “attempting to undermine your very existence.” In June, he spoke at the Personal Democracy Forum in New York, an annual gathering of technology devotees that included speeches by industry leaders, a “hackathon,” and a scholarship award sponsored by Google. A moderator said Mr. Sherman had stepped into the “lion’s den” by speaking at the conference.

“The legislative route is no longer appealing or practical,” Mr. Sherman said in an interview.

Even with legislation off the table for now, tensions remain. In April, a federal appeals court reversed a lower court’s decision to throw out a $1 billion lawsuit that Viacom had filed against Google’s YouTube for using unauthorized video clips from shows like Comedy Central’s “The Colbert Report” and “The Daily Show with Jon Stewart.”

Mr. Emanuel of William Morris pressed Google and others at the May conference to help the entertainment industry combat piracy. “One day they’re going to figure out that they’re just big pipes and they need premium content,” he said.

Through a spokeswoman, Google released a statement saying the company is “in constant conversations with content creators about how to help them reach new audiences online and protect against piracy. Last year alone we took down five million infringing Web pages and invested more than $60 million in the fight against bad ads.”

Susan Wojcicki, Google’s senior vice president for advertising, said in response to Mr. Emanuel’s comments that “we do not want to be building a business based on piracy.”

During the firestorm on SOPA and PIPA, consumers took the Web’s side, emboldened by a fear that legislation would hinder Internet freedom, but also buoyed by the belief that if content were more readily available online at reasonable prices, consumers would not turn to pirated versions.

In June, Emily White, an intern at National Public Radio, wrote in the blog All Things Considered that, though she had more than 11,000 songs in her iTunes music library, she had paid for only 15 compact discs. The admission sparked a wave of response from musicians.

“Fairly compensating musicians is not a problem that is up to governments and large corporations to solve,” the songwriter and guitarist David Lowery wrote in response to Ms. White’s blog post. “It’s not up to them to make it ‘convenient’ so you don’t behave unethically.”

A civilized debate between consumers and artists was a “nice silver lining” in the antipiracy debates that raged last winter, said Sandra Aistars, executive director of the Washington-based nonprofit Copyright Alliance.

She added: “It shows you can have a rational dialogue on this issue and talk in a way that isn’t so politically charged.”
https://www.nytimes.com/2012/07/10/b...te-piracy.html





Lamar Smith Looking To Sneak Through SOPA In Bits & Pieces, Starting With Expanding Hollywood's Global Police Force
Mike Masnick

While it didn't get nearly as much attention as other parts of SOPA, one section in the bill that greatly concerned us was the massive expansion of the diplomatic corp.'s "IP attaches." If you're unfamiliar with the program, basically IP attaches are "diplomats" (and I use the term loosely) who go around the globe pushing a copyright maximalist position on pretty much every other country. Their role is not to support more effective or more reasonable IP policy. It is solely to increase expansion, and basically act as Hollywood's personal thugs pressuring other countries to do the will of the major studios and labels. The role is literally defined as pushing for "aggressive support for enforcement action" throughout the world. A few years ago, we detailed how, at a meeting of these attaches, they bitched and complained about how copyright "activists" were making their lives difficult and were a "threat" who needed to be dealt with.

In other words, these people are not neutral. They do not have the best interests of the public or the country in mind. Their job is solely to push the copyright maximalist views of the legacy entertainment industry around the globe, and position it as the will of the US government.

It was good that this was defeated as a part of SOPA... but now comes the news that Lamar Smith is introducing a new bill that not only brings back this part, but appears to expand it and make it an even bigger deal. Politico has a short blurb:

SMITH, OTHERS UNVEIL IP BILL -- House Judiciary Committee chief Lamar Smith and other members are unveiling today their new Intellectual Property Attache Act, which realigns the Commerce Department a bit. The measure as proposed would move the current attache program housed with the USPTO to the full agency, complete with an assistant secretary of Commerce for Intellectual Property. The proposal is slated for full committee markup on Tuesday. Named as supporters on the measure are a number of panel Dems and Republicans: Reps. Bob Goodlatte, Mel Watt, Darrell Issa, Howard Berman, Howard Coble, Steve Chabot, Jason Chaffetz and Adam Schiff

You can see the current draft of the bill, but it has not yet been officially introduced. However, the House Judiciary Committee is scheduled to mark it up in the morning, suggesting that it's on the fast track, with almost no public scrutiny. In fact, I've heard from people worried about this bill that they were only told of its existence on Saturday.

The specifics of the bill appear to go further than the version in SOPA. It is clear that the bill itself is framed from the maximalist perspective. There is nothing about the rights of the public, or of other countries to design their own IP regimes. It notes that the role of the attaches is:

to advance the intellectual property rights of United States persons and their licensees;

The bill also "elevates" the IP attaches out of the US Patent and Trademark Office, and sets them up as their own agency, including a new role: the Assistant Secretary of Commerce for Intellectual Property. Yes, we'll get another IP Czar, this time focused in the Commerce Department.

When even the USTR is recognizing the importance of limitations and exceptions to copyright, to have Congress push a bill that basically ignores limitations and exceptions and only looks to expand Hollywood's special thugs within the diplomatic corp. seems like a huge problem.

But the even bigger issue is a simple one of process. Shouldn't Lamar Smith have learned by now that you don't try to sneak through SOPA or any of its components without first getting widespread public opinion on these things?
http://www.techdirt.com/articles/201...ce-force.shtml





SOPA Architect Now Pushing for "IP Attaché" Legislation

Bill's proponents say it would streamline an a complex system of management.
Cyrus Farivar

Another week, another controversial intellectual property enforcement bill hits Capitol Hill. This time, it’s called the IP Attaché Act, and while a draft bill has been released so far, it hasn’t officially be introduced in Congress.

The bill, its proponents say, "streamlines" the process of intellectual property enforcement abroad. Meanwhile, opponents charge that this is wholly unnecessary, given the myriad of federal agencies that already do this, in addition to the fact that this bill has been drafted in secret.

Some media outlets have charged that this new bill is a way to re-introduce SOPA, the controversial bill that died in Congress earlier this year. Indeed, this bill is sponsored chiefly by Rep. Lamar Smith (R-TX), who also was one of the primary architects of SOPA.

Strong copyright for all

According to the draft, the law would "establish an intellectual property attaché program by appointing and placing intellectual property attachés in United States embassies or diplomatic missions in countries where the activities of such an attaché are likely," and that this person would direct enforcement mechanisms as dictated by the United States Trade Representatives.

Those officers would then report ultimately to a new Commerce position, called the "Assistant Secretary for Intellectual Property," which would be appointed by the President. This person would be tasked with "[advancing] the intellectual property policy of the United States, consistent with the economic interests of the United States, both domestically and abroad."

The bill appears to further endorse a strong copyright point-of-view that the American government has become notorious for pushing around the world.

Opponents say new bill unnecessary

Public advocacy groups, most notably Public Knowledge, said there were plenty of federal entitites that deal with IP regulations.

"We already have, to name a few examples, an Intellectual Property Enforcement Coordinator, Office of Intellectual Property Rights at the Department of Commerce, Office of International Intellectual Property Enforcement at the State Department, Office of the Administrator for Policy and External Affairs–Enforcement at the Patent and Trademark Office, National Intellectual Property Rights Coordination Center, Office of Intellectual Property and Innovation at the United States Trade Representative, and Intellectual Property Task Force at the Department of Justice," the organization wrote on Wednesday.

Meanwhile, a Judiciary Committee aide to Rep. Smith wrote in an e-mail to Ars that the bill is certainly not a follow-up to SOPA.

"The bill that the Committee currently is working on is a narrow piece of legislation to ensure better use of Patent and Trademark Office funds," the e-mail states, adding that a new draft would be circulated soon.

"The current draft increases organizational efficiency at the PTO and moves the IP attaché program squarely within the PTO to ensure direct accountability of the IP attachés."
http://arstechnica.com/tech-policy/2...e-legislation/





Dear Lamar Smith & House Judiciary: Have You Learned Nothing From SOPA?
Mike Masnick

I've been hearing for a few months now that the staffers on the House Judiciary Committee, who were the main supporters of SOPA, haven't been able to let go of what happened (or even understand it). That's been pretty obvious from the few public statements they've made since SOPA failed. And now it's been made doubly clear. On Monday, we wrote about how Lamar Smith and the House Judiciary Committee that he chairs were looking to rush through a piece of SOPA embedded in another bill. It wasn't one of the most controversial bits, but it was an issue we had raised with SOPA, even if it took a back seat to some of the bigger problems.

What was stunning was that the SOPA protests were largely about process -- backroom deals, without public input or scrutiny -- and in this case, with this new bill (officially dubbed the Intellectual Property Attache Act) they not only did the same thing, but were trying to rush it through on a fast track significantly more extreme than SOPA. That is, they only shared the draft on Saturday and announced that there would be a markup on the bill (which they never even introduced) on Tuesday morning. That's rare. Normally, you officially introduce the bill, hold various hearings that involve experts, make some adjustments, and then hold a markup hearing to allow for additional amendments. In this case, they jumped right to that last step -- completely skipping over some rather major steps that would allow for public input and scrutiny.

In other words, they did the exact opposite of what the SOPA experience told them they should do.

However, because we and a few other sites pointed out the issues here, some of the original supporters of the bill began expressing doubts. Some others on the HJC offered up amendments -- including one that would say that the IP attaches couldn't just focus on enforcement, but also on limitations and exceptions like fair use (you know, actually focusing on what US law is, rather than what Hollywood wishes it would be). But apparently there is resistance to those amendments. However, because lots of people did speak up and let the HJC and Lamar Smith know that they would not accept them rushing through a piece of SOPA without public discussion, the bill has been (temporarily) delayed.

Of course, still not getting it, the HJC issued a petulant statement, effectively blaming us for this turn of events:

"This week, the House Judiciary Committee released a discussion draft of a bill that streamlines the IP attache program to help safeguard American intellectual property abroad. Unfortunately, some groups and blogs have misreported that this is a follow up to the Stop Online Piracy Act. That is not the case. The bill that the Committee currently is working on is a narrow piece of legislation to ensure better use of Patent and Trademark Office funds. The current draft increases organizational efficiency at the PTO and moves the IP attache program squarely within the PTO to ensure direct accountability of the IP attaches.

"Since releasing that draft, for which there is bipartisan and industry support, we are making some changes based on feedback from outside groups and Members. We plan to circulate a new draft based off those changes to ensure that the development of this bill continues to be an open and transparent process."

The statement is partially misleading and partially false. First of all, the language is quite similar to a portion of SOPA -- so claiming that it's not a "followup" to SOPA is clearly false. This was a part of SOPA, and now it's a part of a new bill -- but ignoring the fact that it was in SOPA is simply wrong. Second, the statement is incredibly misleading, in that they suggest that they were always seeking feedback. That's not true at all. It was on the markup schedule for Tuesday morning -- and that was published on the HJC website for anyone to see (though it's since been taken down). Finally, no one else saw a draft until Saturday and no one in the press got it until Monday morning -- about 24 hours before the markup (despite HJC staffers promising some members that it would release the draft at least a week before any effort to move it forward). Basically, the HJC staffers who put out this statement are creating a misinformation campaign, claiming (incorrectly) that we and a few other blogs who wrote about this were the ones spreading the misinformation.

They can't even own up to their own attempt to rush this bill through. It's shameful.

As Ernesto Falcon at Public Knowledge has written, if you want to "shake the ghost of SOPA," perhaps try to not rush through a bill that you kept secret without allowing the normal process of public comment and feedback.

The latest controversy with the Intellectual Property Attache Act, formerly a provision within the Stop Online Piracy Act (SOPA), is entirely self-inflicted by its lead sponsors.

You do not have to be a political strategist to figure out that trying to pass a piece of SOPA might in fact inflame the wide array of opposition to SOPA. You also can not cry foul when you secretly develop the legislation, hold no legislative hearing on its merits, and attempt (and thankfully fail) to move the legislation through the Committee almost 24 hours after it was leaked to the press. Each of these steps flies in the face of the request made by opponents to SOPA for more openness, inclusion, and transparency for intellectual property policy decisions. It is as if the some believe that the business of copyright legislating can proceed as usual and that the Internet Black Out never occurred.

If the House Judiciary Committee wants to shake off the ghost of SOPA and avoid having legislation blow up in their collective faces, they need to rethink how they move intellectual property bills. The Committee must proactively work at justifying to the public why a bill is necessary and win their support for its passage before voting it out. It should stop trying to move bills first and put the burden on the public to stop them from blindly moving forward.

At this point, we've heard that some Judiciary Committee staffers view sites like Techdirt as "the enemy." That's completely wrong. We'd just like them to not try to sneak bad bills through -- and to actually do their job and let the public weigh in on things. Is that so difficult to comprehend? This isn't political. We have nothing against the House Judiciary Committee as a whole. We'd just like them to actually acknowledge the public's role in the process. If they did so, perhaps people wouldn't complain and speak out. If they really are being "open" about this, then there wouldn't the this sudden surprise. There wouldn't be this attempt to rush things through... and there wouldn't be a public outcry. So it's in their own best interests to actually admit that the public exists and should be a part of the process, rather than snubbing them.
http://www.techdirt.com/articles/201...ing-sopa.shtml





EU Parliament Rejects ACTA Defeat; USTR Starts To Get Clue, MPAA/RIAA Still In Denial.
Harold Feld

Well, it's been a fun week on the international trade agreement front. Monday began yet another negotiating round for the Trans-Pacific Partnership (TPP) trade agreement, this time in San Diego. To the amazement of everyone, the US Trade Representative (USTR) announced on July 3 it would now include a provision in the intellectual property (IP) chapter recognizing the importance of "limitations and exceptions" to copyright and embracing the international 3-part test for what constitutes suitable limitations and exceptions. (For those not familiar with this term of art, "limitations and exceptions" are things like Fair Use and First Sale Doctrine in the United States. As the name implies, limitations and exceptions to copyright limit the rights of the copyright holder and create exceptions to the general rule against copying without permission.)

It is difficult to convey to people who don’t routinely deal with USTR and the copyright maximalists that dominate trade negotiations just how stunning a turn around this is, given the fairly well-established limitations and exceptions in US law and the fact that—as USTR acknowledged in its announcement—the three-part test for what constitutes suitable limitations and exceptions is already well-established and incorporated into international law. Indeed, given all this, the incredible thing is that this is, as USTR acknowledges, the first time USTR has included any explicit reference to limitations and exceptions. In addition, as my colleague Rashmi Rangnath points out over at the Public Knowledge blog, while this is a positive step for USTR, we have not seen the new draft TPP text, so the actual implementation of these principles in the TPP draft could still be a major step backward from existing US law.

Let me use an analogy to explain why this is, nevertheless, a big deal. For USTR to publicly embrace limitations and exceptions as "an important part of the copyright ecosystem" is the equivalent of The Pope saying: "in some cases, birth control is a good thing because it allows married couples to have sex without procreation, deepening their emotional bond with one another."

What happened? ACTA

So even if this is just public posturing, it marks a dramatic departure from the USTR’s traditional position—which is to avoid the entire subject of limitations and exceptions as much as possible while implying, without actually saying, that the very existence of the concept of "limitations and exceptions to copyright" makes the universe a less perfect place.

Such things do not happen by chance. [US Trade Representative] Ron Kirk did not wake up Tuesday morning July 3 and say, "I had a dream of a world with no limitations and exceptions to copyright and learned a Very Important Lesson In Life." Mind you, I am not questioning the sincerity of USTR; this is about shaping policy, not building a relationship or going on a date. I am totally down with people doing the right thing for the wrong reason. But success also depends on understanding why USTR felt compelled to change their public position.

The next day, on July 4, we got what I consider the most likely explanation. The European Parliament utterly rejected the Anti-Counterfeiting Trade Agreement (ACTA). And while supporters within the European Commission may still plot to keep it alive, the short term result is that the insistence on serving the interests of the Motion Picture Association of America (MPAA) and the Recording Industry Association of America (RIAA) by trying to force copyright maximalism on other countries killed the treaty after about six years of negotiation. That’s a lot of wasted time and effort.

Worse, many US industries outside of Hollywood and the recording industry wanted ACTA to actually fight real counterfeiting. So not only did everyone end up wasting time on a treaty no one wants to sign anymore, businesses hoping to use the agreement to fight the folks making warehouses full of fake Rolex watches and such what are totally out of luck. And why? Because the MPAA/RIAA insisted ACTA needed lots of crazy stuff on intellectual property, and no one wanted to say no to the MPAA/RIAA. Oh, if only some wise public interest advocate had warned them that including all this crazy stuff around IP in ACTA put getting a real trade agreement to address real counterfeiting at risk! Oh wait...

True, ACTA might have slipped through without much public notice or discussion, like nearly every other international trade agreement, but for the consciousness raising exercise that was the fight against SOPA. Europeans and others who thought copyright maximalism was a uniquely American disease suddenly took an interest in what their own governments were doing and experienced a collective freak out. Critically, folks got quite upset that ACTA would apparently require them to change their copyright laws in ways they regarded as inimical to recognized limitations and exceptions and that therefore violated fundamental human rights principles. The usual blandishments and arrogant dismissals of these criticisms by ACTA supporters as ill-informed, driven by pirates and profiteers such as Google, and necessary to protect poor starving artists failed to soothe the opposition. To the contrary, it only aroused further fury. As a result, the EU vote rejecting ACTA was one of the most lopsided votes in its history (478-39).

USTR gets a clue

All of this, combined with new objections to the TPP process by a growing number of Congressmen, has apparently prompted USTR to get a clue. As ACTA’s resounding rejection proves, the old playbook of whittling away limitations and exceptions to copyright both here and abroad by refusing to acknowledge their existence or importance just doesn’t cut it in a post-SOPA world. At a minimum, international agreements must at least pay lip service to the vital role of limitations and exceptions in "the copyright ecosystem." (Of course, the actual language of the treaty might still undermine limitations and exceptions in practice while pretending to acknowledge their importance on the surface.)

In addition, the recognized international 3-part test USTR refers to is pretty vague, since it constitutes the minimum standard that all countries must acknowledge (even if they’d rather not) under accepted norms of international law. So a treaty provision can be totally compliant with the international 3-part test and still represent a major step forward for copyright maximalism by reducing existing limitations and exceptions as incorporated in the law of the United States and many other countries.

Mind you, despite the fact that this acknowledgement does not give up much practical ground, MPAA and RIAA are reportedly furious with the announcement and latest draft of the TPP IP chapter. Since selected industry representatives get full access to the proposed text, it may well be that the new text contains some real policy shifts as well as a change in rhetoric. But I suspect the fury of the MPAA and RIAA comes from the fact that they appear to believe that Wikipedia and Google are responsible for all this, and no real world evidence will tell them otherwise. As a result, they regard even a rhetorical shift by USTR acknowledging the importance of limitations and exceptions as a betrayal and as caving in to "Big Knowledge" bullies like Wikipedia.

Also, even if USTR turns out to be merely paying lip service to the concept, MPAA/RIAA have definitely lost a major round here. To have limitations and exceptions openly in the room and acknowledged as a critical element in any trade agreement rather than treated as something questionable to be ignored changes the tenor of negotiations and makes it harder for the IP Mafia to push for unilateral expansion of copyright at the continuing expense of long-established limitations and exceptions. For a lobby unused to losing, this change in position from a previously rock-solid ally—no matter how politically necessary in the short-term—represents another galling lose in a year marked by several unanticipated reversals.

How should opponents of copyright maximalism respond?

I have many rules of advocacy. One is: "Always make it easy for other people to agree with you." This is doubly true when I believe the other side is making the concession grudgingly. So the first response is to thank USTR and acknowledge its significant shift in position. The second step is to help USTR move down the path of wisdom by refining the text—aware that the IP Mafia will do everything in its power to reverse course and shift USTR back to its traditional position.

Keep in mind that the majority of people working for USTR don’t like to waste effort any more than the rest of us, and the realization that a significant portion of the rest of the world may reject whatever final deal negotiators agree to if it goes too far on copyright is no doubt causing many to rethink their positions. In addition, USTR has many other industries it services besides Hollywood. They need trade agreements—and USTR is required to negotiate these. The Hollywood crazy train on intellectual property enforcement now very visibly threatens the ability to get future trade agreements ratified by Congress or by foreign governments. The manufacturing sector, the retail sector, and others that have until now tolerated Hollywood’s demands in the interest of maintaining a united industry front will not sacrifice their own international trade interests for the Entertainment industry—and will push USTR to negotiate agreements that actually have a chance at ratification.

All this creates a positive opportunity going forward. For the first time, civil society has something USTR needs—an ability to legitimize the treaty text. The global lobbying muscle of the MPAA/RIAA is no longer enough. While that does not make civil society an equal in the negotiations by any stretch of the imagination, it is a much stronger bargaining position than ever before.

This is not to say that people long convinced of the rightness of copyright maximalism (which rejects limitations and exceptions) will change their minds on the merits. Although this may come too, in time. But policy is not about getting people to do the right thing for the right reasons, it is about getting them to do the right thing for their own reasons. In this case, USTR has excellent reasons to shift position and bring civil society more strongly into the mix. The job for civil society is continuing to enhance the value of what we offer by keeping the pressure on for substantive language that genuinely embraces existing limitations and exceptions. MPAA/RIAA have excellent incentive for this as well, although I expect them to take much longer to recognize this.

All in all, 2012 continues to be a landmark year for intellectual property policy. The anti-SOPA campaign has genuinely changed the way in which IP policy gets negotiated, rather than fading away as memory of the legislation recedes. No, that doesn’t mean everything is now hunky-dory and we now go home. But did anyone ever think it would? What the ACTA defeat in Europe and the pressure on USTR to shift position show is that the campaign to prevent the further erosion of free expression in the name of copyright maximalism has staying power. It now falls to all of us to ensure that we keep moving things in the right direction.
http://tales-of-the-sausage-factory....till-in-denial





ACTA Lives: How the EU & Canada Are Using CETA as Backdoor Mechanism To Revive ACTA
Michael Geist

Last week, the European Parliament voted overwhelmingly to reject ACTA, striking a major blow to the hopes of supporters who envisioned a landmark agreement that would set a new standard for intellectual property rights enforcement. The European Commission, which negotiates trade deals such as ACTA on behalf of the European Union, has vowed to revive the badly damaged agreement. Its most high-profile move has been to ask the European Court of Justice to rule on ACTA's compatibility with fundamental European freedoms with the hope that a favourable ruling could allow the European Parliament to reconsider the issue.

While the court referral has attracted the lion share of attention, my weekly technology law column (Toronto Star version, homepage version) reports that there is an alternate secret strategy in which Canada plays a key role. According to recently leaked documents, the EU plans to use the Canada - EU Trade Agreement (CETA), which is nearing its final stages of negotiation, as a backdoor mechanism to implement the ACTA provisions.

The CETA IP chapter has already attracted attention due to EU pharmaceutical patent demands that could add billions to provincial health care costs, but the bigger story may be that the same chapter features a near word-for-word replica of ACTA. According to the leaked document, dated February 2012, Canada and the EU have already agreed to incorporate many of the ACTA enforcement provisions into CETA, including the rules on general obligations on enforcement, preserving evidence, damages, injunctions, and border measure rules. One of these provisions even specifically references ACTA. A comparison table of ACTA and the leaked CETA chapter is posted below.

The EU has also proposed incorporating ACTA's criminal enforcement and co-operation chapters into CETA. The criminal provisions were the target of European Parliament criticism for their lack of proportionality and uncertain application.

Canada has similarly pushed for the inclusion of ACTA provisions, proposing identical digital lock rules as well as ACTA-style Internet service provider provisions that raised privacy concerns from the European Data Protection Supervisor. In fact, Canada would like to extend ACTA by mandating an anti-camcording provision (a similar provision is currently voluntary in ACTA).

The European Commission strategy appears to be to use CETA as the new ACTA, burying its provisions in a broader Canadian trade agreement with the hope that the European Parliament accepts the same provisions it just rejected with the ACTA framework. If successful, it would likely then argue that ACTA poses no new concerns since the same rules were approved within the Canadian trade deal.

The backdoor ACTA approach creates enormous risks for Canada's trade ambitions. Given the huge anti-ACTA movement, the Canada - EU trade deal could face widespread European opposition with CETA becoming swept up in similar protests.

With anti-ACTA sentiment spreading across Europe, Canada should push to remove the intellectual property chapter from CETA altogether. The move would not be unprecedented. Many of Canada's free trade agreements feature only limited IP provisions and last year a Canadian parliamentary committee recommended that "domestic copyright policies are not part of any present or future trade negotiations."

Meanwhile, the U.S. and EU recently announced their own plans to negotiate a trade deal but agreed to keep intellectual property issues out of the talks. If CETA becomes known as ACTA II, the future of the Canada - EU trade deal may hinge on adopting a similar approach.
http://www.michaelgeist.ca/content/view/6580/135/





The Inclusion of ACTA Within CETA, Why The Concern Is Warranted
Michael Geist

My post yesterday on how the EU plans to use the Canada - EU Trade Agreement (CETA) as a backdoor mechanism to implement the Anti-Counterfeiting Trade Agreement (ACTA) provisions has attracted considerable attention with coverage from European media and activists. The European Commission refused to comment, stating that it does not comment on leaks.

Some have noted that since the leaked CETA IP chapter dates from February 2012, the concern is premature since the current EC position may change in light of the recent European Parliament vote to reject ACTA. According to this view, "it's more than likely that the European Parliament will kill CETA just as (and because of) ACTA was killed last week."

While a change to the IP chapter would be welcome (I argued it should be removed from CETA altogether), I think the concern is warranted for several reasons.

First, the latest debrief on the CETA negotiations from Canadian officials in May 2012 indicated that the copyright provisions were no longer the source of serious disagreement. This suggests that both sides have largely agreed on the ACTA model for CETA. In fact, the square brackets (which indicate disagreement) were already removed from many ACTA provisions in the February draft including the rules on general obligations on enforcement, preserving evidence, damages, injunctions, and border measure rules.
Second, CETA follows the same secrecy model as was the case with ACTA. No official text has been released and there is every reason to believe that the public will gain official access only after the negotiations have concluded. This will once again mean that the agreement is take-it-or-leave-it, with no scope for renegotiation. Waiting for the final text therefore runs the risk of another battle over ACTA in the European Parliament.

Third, that European Parliament battle will be more difficult than was the case with ACTA. CETA is a massive trade agreement of which intellectual property is only one chapter and the ACTA provisions are only one part of that chapter (there are also enormously problematic patent provisions that would drive up pharmaceutical costs). The agreement touches on virtually all aspects of the economy meaning the pressure on the European Parliament to approve the deal (if it is concluded) will be far stronger than was the case with ACTA.

Fourth, the inclusion of ACTA provisions within another trade agreement is emerging as a preferred model for some countries. As part of the Trans Pacific Partnership talks, there have been reports that Australia, New Zealand, and Singapore (all ACTA signatories) are pushing to include ACTA language within the TPP. Canada and Mexico may well adopt the same approach once they enter the negotiations.

In other words, it isn't just about ACTA in CETA. While the European Parliament rejected ACTA, Switzerland won't sign it, and an Australian parliamentary committee has recommended delaying ratification, the efforts to embed the ACTA provisions within new trade agreements is emerging as a core part of the long-term strategy by ACTA supporters.
http://activepolitic.com:82/News/201...rrant ed.html





Don't Believe Every Leak You Read Says EU Commission on CETA

CETA text regarding the Internet is totally different from ACTA, the Commission said
Jennifer Baker

The European Commission on Wednesday evening said that the "language being negotiated on CETA regarding Internet is now totally different from ACTA".

On Tuesday a leaked draft of the Canada-E.U. Trade Agreement (CETA) dating from February caused controversy when it was noted by digital rights activists to contain the same text as the Anti-Counterfeiting Trade Agreement (ACTA) which was rejected by the European Parliament over online civil liberty concerns.

However, as confirmed by the Commission Trade spokesman John Clancy on Twitter earlier on Wednesday, the Commission said that the most contested articles in ACTA, related to ISPs being asked to hand over information about subscribers to copyright holders and working with the business community to clamp down on intellectual property infringement, are not part of the current, up-to-date CETA text, and have been replaced by an entirely different text based on the E.U.'s E-Commerce directive

Referring to other similarities with ACTA, the Commission pointed out that many of the provisions in the CETA intellectual property chapter are based on existing E.U. legislation; namely the 2000 eCommerce Directive; the 2001 Information Society Directive; the 2003 Customs Regulation; and the 2004 Enforcement Directive.

"In some of these cases, the language is also similar to the one contained in the 1996 TRIPS Agreement, an international WTO treaty -- these similarities are very likely to stay in the CETA text, but it is false to say that they originate in ACTA," said Commission sources.

The Commission added that a re-evaluation of the CETA text is currently under way "to take into account the impact of the rejection of ACTA".

The Commission also noted that criminal enforcement is a national competence and that this element of the agreement is negotiated by the European Council representing the member states. "The last time there was a negotiating session on criminal enforcement, during a video-conference in October 2011, no agreement was reached on some of the proposals by Canada which are indeed far-reaching," said the Commission.

In an email, Clancy also scotched rumors that CETA could introduce ACTA through the backdoor, saying there is "no basis for any conspiracy theories."

"These accusations are nonsense. A future E.U.-Canada trade deal will be very similar to the bilateral trade deal with South Korea already up and running for a year and which has not brought about the end of a free Internet."

But as the deal is being conducted in secret some digital activists will be difficult to convince. "I want to see proof!" said Jérémie Zimmermann, co-founder of La Quadrature du Net.
http://www.itworld.com/internet/2856...ommission-ceta





File Sharing Persists in Businesses, as Browser-Based Technology Emerges
Dan Raywood

Analysis has found that the bandwidth consumed by peer-to-peer (P2P) file sharing applications now accounts for 14 per cent of the average overall bandwidth used.

According to the Palo Alto Networks application usage and risk report, P2P file sharing ‘quietly' continues to be used across all manner of organisations, despite efforts to control it.

It said that of the 38 variants found during the six-month period, at least one P2P application was detected on 78 per cent of the participating organisations and on average, seven different P2P applications were found on each network.

Following the launch of at least three new browser-based file sharing applications by Google, Facebook and Citrix and with at least 70 different file sharing variants available, the report said that this renews concerns over privacy and security.

It claimed that the most well-known risk is the loss of data through improper use, particularly as breaches have occurred, running into millions of records in the past. It highlighted the incident where blueprints of President Obama's helicopter Marine One were found on a P2P network.

It said: “The risk of data loss remains significant as evidenced by the February 2012 notice sent by the FTC to more than 100 organisations of all types informing them that their confidential data was floating around on P2P file sharing networks and that it was their responsibility to exert control over that data.”

In terms of security threats to the network, it said that the distributed nature of P2P is a fundamental part of how the technology works, and also underlies what makes it so risky.

“Because files can be uploaded to a P2P network and distributed to a tracker anonymously, the use of P2P poses significant moral hazard, as it provides a convenient and risk free method to distribute malware to a large user population anonymously,” it said.

The report also found that browser-based file sharing is more popular than P2P in terms of frequency of use and the number of variants found. It said that of the 140 file sharing applications found, 71 are browser-based, 38 are P2P and the remainder are client-server.

Palo Alto Networks found at least one browser-based file sharing application on 89 per cent of the participating networks, while an average of 13 different browser-based file sharing applications were found on each network.

It also claimed that as more of these offerings add premium services such as auto synch, the risks of data loss will only increase.

It blamed the ‘byzantine language' used in the terms of service that ensure few outside of the legal profession understand what they are reading, and that both Facebook and Google admittedly analyse the content stored in their services for marketing purposes to make organisations concerned about employees using these applications.

“With the recent file sharing announcements from Facebook and Google, the terms-of-service and who owns the data have become cause for concern both for individuals and for organisations,” it said.

“With Google, Facebook and Citrix all announcing browser-based file sharing alternatives, on top of the other 70 or so existing offerings, this group of applications shows no signs of going away or slowing down. However, with so many variants there will no doubt be some additional segment refinement and use case definition as they all struggle to compete and survive.”
http://www.scmagazineuk.com/file-sha...rticle/249830/





PayPal Terms Require File-Sharing Operators to Let it Monitor for Pirate Content

Operators of file-sharing websites that take PayPal payments are required to allow PayPal to monitor the services for illegal sharing of content, according to new terms and conditions it has introduced. 12 Jul 2012

Under the terms, which have been posted by the TorrentFreak technology news website, business that offer "file-sharing programs or access to newsgroup services" are obliged to sign-up to a range of new measures aimed at tackling online piracy in order to be able to use PayPal services.

One of the terms requires the businesses to "provide PayPal with free access to their service, so PayPal's Acceptable Use Policy department can monitor the content."

Under PayPal's Acceptable Use Policy all users of PayPal services are prohibited from using the payment provider for "activities that relate to transactions involving ... items that infringe or violate any copyright, trademark, right of publicity or privacy or any other proprietary right under the laws of any jurisdiction."

However, one file hosting site said that it was not justified for PayPal to be able to monitor its users' activities, according to TorrentFreak's report. Putlocker had its PayPal services suspended after refusing to agree to the payment provider's terms.

"They basically wanted access to the backend to monitor all the files being uploaded, and listing all files of users if they wanted, regardless of the privacy setting that the user might have selected,” Putlocker said, according to the report. "This is a complete invasion of privacy on PayPal’s part, as it’s none of their business what files users keep in their account. We have a solid abuse handling policy already, and we don’t feel a 3rd party company has any business snooping on our users."

PayPal also requires that file-sharing website operators inform it of the measures they go to to monitor user files and remove or block access to apparently illegal content. The operators must also themselves explicitly prohibit the uploading of illegal content in their own terms of use in order to use PayPal services.

In addition the site operators must detail to PayPal their procedures for responding to notice and takedown requests from rights holders and "take immediate steps to prevent access" to files within one working day when PayPal flags up that files "appear to involve illegal content".

PayPal did not respond to our request for a comment.

Last year PayPal committed to cut funding to websites deemed 'illegal' by the music industry and the City of London Police.

Trade body the International Federation of the Phonographic Industry (IFPI) said it would identify sites that it believes are selling music without having the right to do so and that the City of London Police would pass the information to PayPal which will then demand evidence that music that is sold had been licensed.
http://www.out-law.com/en/articles/2...irate-content/





Three NSA Whistleblowers Back EFF's Lawsuit Over Government's Massive Spying Program

EFF Asks Court to Reject Stale State Secret Arguments So Case Can Proceed

San Francisco - Three whistleblowers – all former employees of the National Security Agency (NSA) – have come forward to give evidence in the Electronic Frontier Foundation's (EFF's) lawsuit against the government's illegal mass surveillance program, Jewel v. NSA.

In a motion filed today, the three former intelligence analysts confirm that the NSA has, or is in the process of obtaining, the capability to seize and store most electronic communications passing through its U.S. intercept centers, such as the "secret room" at the AT&T facility in San Francisco first disclosed by retired AT&T technician Mark Klein in early 2006.

"For years, government lawyers have been arguing that our case is too secret for the courts to consider, despite the mounting confirmation of widespread mass illegal surveillance of ordinary people," said EFF Legal Director Cindy Cohn. "Now we have three former NSA officials confirming the basic facts. Neither the Constitution nor federal law allow the government to collect massive amounts of communications and data of innocent Americans and fish around in it in case it might find something interesting. This kind of power is too easily abused. We're extremely pleased that more whistleblowers have come forward to help end this massive spying program."

The three former NSA employees with declarations in EFF's brief are William E. Binney, Thomas A. Drake, and J. Kirk Wiebe. All were targets of a federal investigation into leaks to the New York Times that sparked the initial news coverage about the warrantless wiretapping program. Binney and Wiebe were formally cleared of charges and Drake had those charges against him dropped.

Jewel v. NSA is back in district court after the 9th U.S. Circuit Court of Appeals reinstated it in late 2011. In the motion for partial summary judgment filed today, EFF asked the court to reject the stale state secrets arguments that the government has been using in its attempts to sidetrack this important litigation and instead apply the processes in the Foreign Intelligence Surveillance Act that require the court to determine whether electronic surveillance was conducted legally.

"The NSA warrantless surveillance programs have been the subject of widespread reporting and debate for more than six years now. They are just not a secret," said EFF Senior Staff Attorney Lee Tien. "Yet the government keeps making the same 'state secrets' claims again and again. It's time for Americans to have their day in court and for a judge to rule on the legality of this massive surveillance."

For the full motion for partial summary judgment:
https://www.eff.org/document/plainti...mmary-judgment

For more on this case:
https://www.eff.org/cases/jewel

https://www.eff.org/press/releases/t...spying-program





Wireless Firms Are Flooded by Requests to Aid Surveillance
Eric Lichtblau

In the first public accounting of its kind, cellphone carriers reported that they responded to a daunting 1.3 million demands for subscriber data last year from law enforcement agencies seeking text messages, caller locations and other information in the course of investigations.

The data, which comes in response to a congressional inquiry, documents an explosion in cellphone surveillance in the last five years, with the wireless carriers turning over records thousands of times a day in response to police emergencies, court orders, law enforcement subpoenas and other requests.

The cell carriers’ reports also reveal a sometimes uneasy partnership with law enforcement agencies, with the carriers frequently rejecting demands they considered legally questionable or unjustified. Carriers even referred some inappropriate requests to the F.B.I.

The statistics represent the first time data has been collected nationally on the frequency of cell surveillance by law enforcement. The volume of the requests reported by the carriers — which most likely involve several million subscribers — even surprised some officials who have closely followed the growth of cell surveillance.

“I never expected it to be this massive,” said Representative Ed Markey, the Massachusetts Democrat who requested the data from nine carriers, including Sprint, AT&T, Verizon and T-Mobile, in response to an article in April in The New York Times on law enforcement’s expanded use of cell tracking. Mr. Markey, who is co-chairman of the Bipartisan Congressional Privacy Caucus, made the carriers’ responses available to The Times.

While the cell companies did not break down the types of law enforcement agencies collecting the data, they made clear that the widened cell surveillance cuts across all levels of government — from run-of-the-mill street crimes handled by local police departments to financial crimes and intelligence investigations at the state and federal levels.

AT&T alone now responds to 230 emergency requests a day nationwide — triple the number it fielded in 2007, the company told Mr. Markey. Law enforcement requests of all kinds have been rising quickly among the other carriers as well, with annual increases of 12 percent to 16 percent in the last five years. Sprint led the way last year, reporting more than 500,000 law enforcement requests for data.

With the rapid expansion of cell surveillance have come rising concerns — even among the carriers — about what legal safeguards are in place to balance law enforcement agencies’ needs for quick information against the privacy rights of consumers.

Legal conflicts between those competing needs have flared before, but usually on national security matters. In 2006, phone companies that cooperated in the Bush administration’s secret program of eavesdropping on suspicious international communications without court warrants were sued, and ultimately were given immunity by the courts. The next year, the F.B.I. was widely criticized for improperly using emergency letters to the phone companies to gather records on thousands of phone numbers in counterterrorism investigations that did not involve emergencies.

Under federal law, the carriers said they generally require a search warrant, court order or formal subpoena to release information about a subscriber. But in cases that law enforcement officials deem an emergency, a less formal request is often enough. Moreover, rapid technological changes in mobile phones have blurred the lines on what is legally required to get data — particularly the use of GPS systems to identify the location of a cellphone.

As cell surveillance becomes a seemingly routine part of police work, Mr. Markey said in an interview that he worries that “digital dragnets” threaten to compromise the privacy of many customers. “There’s a real danger we’ve already crossed the line,” he said.

Mr. Markey and other Democrats are considering legislation that they say would more clearly draw the line between giving the authorities the technological tools they need and protecting the privacy of the public. With the rising prevalence of cellphones, officials at all levels of law enforcement — local police chiefs, state troopers, federal agents, and others — say cell tracking represents a powerful tool to find suspects, follow leads, identify associates and cull information on a wide range of crimes.

“At every crime scene, there’s some type of mobile device,” said Peter Modafferi, chief of detectives for the Rockland County district attorney’s office, who also works on investigative policies and operations with the International Association of Chiefs of Police. The need for police to exploit that technology “has grown tremendously, and it’s absolutely vital,” he said in an interview.

The surging use of cell surveillance was also reflected in the bills the wireless carriers reported sending to law enforcement agencies to cover their costs in some of the tracking operations. AT&T, for one, said it collected $8.3 million last year compared to $2.8 million in 2007, and other carriers reported similar jumps in billings.

Federal law allows the companies to be reimbursed for their “reasonable” costs for providing a number of surveillance operations. Still, several companies maintained that they lose money on the operations, and Cricket, a small wireless carrier that received 42,500 law enforcement requests last year, complained that it “is frequently not paid on the invoices it submits.”

Because of incomplete record-keeping, the total number of law enforcement requests last year was most likely higher than the 1.3 million that the carriers reported to Mr. Markey. Also, the total number of people whose customer information was turned over through those requests could be several times higher because a single request often involves multiple callers. For instance, when a police agency asks for a cell tower “dump” for data on subscribers who were near a tower during a certain period of time, it may get back hundreds or even thousands of names.

Ironically, warrants for wiretapping by federal and local officials — eavesdropping on conversations — declined 14 percent last year to 2,732, according to a recent report from the Administrative Office of the United States Courts.

The diverging numbers suggest law enforcement officials are shifting away from wiretaps in favor of other forms of cell tracking that are generally less legally burdensome, less time-consuming, and less costly. (Most carriers reported charging agencies between $50 and $75 an hour for cellphone tower “dumps.”)

To handle the demands, most cell carriers reported employing large teams of in-house lawyers, data technicians, phone “cloning specialists” and others around the clock to take requests from law enforcement agencies, review the legality, and provide the data.

With the demands so voluminous and systematic, some carriers have resorted to outsourcing the job. Cricket said it turned over its compliance duties in April to a third party. The outside provider, Neustar, said it does law enforcement compliance for about 400 phone and Internet companies.

But a number of carriers reported that as they seek to balance legitimate law enforcement needs against their customers’ privacy rights, they deny some data demands because they are judged to be overreaching or unauthorized under federal surveillance laws.

Sometimes, the carriers said they determined that a true emergency did not exist. At other times, police agencies neglected to get the required court orders for surveillance measures, left subpoenas unsigned, or failed to submit formal requests.

C Spire Wireless, a smaller carrier, estimated that it rejected 15 percent of all law enforcement demands in whole or part, while AT&T said it rejected about 18 requests each week. (Most carriers did not provide figures on rejections.)

At TracFone, another small carrier providing prepaid service, an executive told Mr. Markey that the company “shares your concerns regarding the unauthorized tracking of wireless phones by law enforcement with little or no judicial oversight, and I assure you that TracFone does not participate in or condone such unauthorized tracking.”

T-Mobile, meanwhile, said that it had sent two law enforcement demands to the F.B.I. because it considered them “inappropriate.” The company declined to provide further details.

Requests from law enforcement officials to identify the location of a particular cellphone using GPS technology have caused particular confusion, carriers said. A Supreme Court ruling in January further muddled the issue when it found that the authorities should have gotten a search warrant before tracking a suspect’s movements with a GPS attached to his car.

Law enforcement officials say the GPS technology built into many phones has proved particularly critical in responding to kidnappings, attempted suicides, shootings, cases of missing individuals and other emergencies. But Sprint and other carriers called on Congress to set clearer legal standards for turning over location data in particular to resolve contradictions in the law.

While the carriers said they always require proper legal orders before turning over nonemergency information, their assurances were somewhat at odds with anecdotal evidence gathered by the American Civil Liberties Union recently from more than 200 law enforcement agencies nationwide.

The reports provided to the A.C.L.U. showed that many local and state police agencies claimed broad discretion to obtain cell records without court orders, and some departments specifically warned officers about the past misuse of cellphone surveillance in nonemergency situations.

Chris Calabrese, a lawyer for the American Civil Liberties Union, said he was concerned not only about officials gathering phone data on people with no real connection to crimes, but also about the agencies then keeping those records indefinitely in internal databases.

“The standards really are all over the place,” Mr. Calabrese said. “Nobody is saying don’t use these tools. What we’re saying is do it with consistent standards and in a way that recognizes that these are tools that really can impact people’s privacy.”
https://www.nytimes.com/2012/07/09/u...veillance.html





Every Click You Make, They'll be Watching

Agencies want access to texts, and social media such as Facebook and Twitter.
Dylan Welch

THE telephone and internet data of every Australian will be retained for up to two years and intelligence agencies would be given increased access to social media sites such as Facebook and Twitter, under a suite of new proposals from Australia's intelligence community.

Revealed in a discussion paper released by the Attorney-General's Department, the more than 40 proposals form a massive ambit claim from the intelligence agencies. If passed they would be the most significant expansion of the Australian intelligence community's powers since the Howard-era reforms following the terrorist attacks of 2001.

The discussion paper containing the proposals was released as part of an announcement by the Attorney-General, Nicola Roxon, who has asked the parliamentary joint committee on intelligence security to review them.

The review will seek public submissions for the next month and will then hold a series of public and classified hearings.

''It will be one of the most controversial inquiries the committee has ever held,'' a government official speaking on condition of anonymity said.

''Once people get their head around this stuff it will be very interesting to see what their reaction will be. In the UK it has led to some very vocal opinions.''

A similar data retention regime proposed in Britain - though of only 12 months, rather than two years, duration - has been widely debated and England's Information Commissioner, Christopher Graham, has stated the case for such regimes has yet to be made.

The Australian proposals will also be sure to attract strong criticism from the Greens and civil liberties groups.

The discussion paper outlines changes to the various Acts governing Australia's six intelligence agencies - which include ASIO, ASIS and the Defence Signals Directorate (DSD).

They are also divided into three categories - those the government agrees with, those they are considering, and those they are seeking advice on.

The proposed reform likely to cause the most outrage is the intention to force all telecommunications providers operating in Australia to retain users' data for up to two years. While some companies voluntarily retain data for such periods, others delete users' call records and internet usage data almost as quickly as they receive it.

Such data retention schemes have been a subject of much global debate, with law enforcement and intelligence agencies saying they are finding it increasingly hard to monitor their targets online due to the proliferation of new tools such as social media, cloud computing and internet communications utilities such as Skype.

Civil liberties groups and some politicians, however, say it is a first step in a systematic erosion of privacy online.

''This extreme proposal is based on the notion that all our personal data should be stored by service providers so that every move we make can be surveilled or recalled for later data-mining,'' the Greens senator Scott Ludlam said.

Also among the proposals are changes to some of the most fundamental divisions between agencies. For six decades ASIO has been the only Australian intelligence agency authorised to routinely collect intelligence on Australians.

However, under a proposed change, officers from Australia's foreign intelligence services, ASIS and the DSD, would be allowed to monitor Australian citizens overseas if an ASIO officer was not available.

ASIO, whose main role is to monitor people in Australia - mainly citizens - who may present a security threat, has a specific legislative framework which was created to protect people's rights. Australians monitored by ASIS or DSD would presumably not have access to similar protections.
http://www.theage.com.au/technology/...711-21wfg.html





Facebook Scans Chats and Posts for Criminal Activity

Facebook's monitoring software focuses on conversations between members who have a loose relationship on the social network.
by Emil Protalinski

Facebook has added sleuthing to its array of data-mining capabilities, scanning your posts and chats for criminal activity. If the social-networking giant detects suspicious behavior, it flags the content and determines if further steps, such as informing the police, are required.

The new tidbit about the company's monitoring system comes from a Reuters interview with Facebook Chief Security Officer Joe Sullivan. Here's the lead-in to the Reuters story:

A man in his early 30s was chatting about sex with a 13-year-old South Florida girl and planned to meet her after middle-school classes the next day. Facebook's extensive but little-discussed technology for scanning postings and chats for criminal activity automatically flagged the conversation for employees, who read it and quickly called police. Officers took control of the teenager's computer and arrested the man the next day.

Facebook's software focuses on conversations between members who have a loose relationship on the social network. For example, if two users aren't friends, only recently became friends, have no mutual friends, interact with each other very little, have a significant age difference, and/or are located far from each other, the tool pays particular attention.

The scanning program looks for certain phrases found in previously obtained chat records from criminals, including sexual predators (because of the Reuters story, we know of at least one alleged child predator who is being brought before the courts as a direct result of Facebook's chat scanning). The relationship analysis and phrase material have to add up before a Facebook employee actually looks at communications and makes the final decision of whether to ping the authorities.

"We've never wanted to set up an environment where we have employees looking at private communications, so it's really important that we use technology that has a very low false-positive rate," Sullivan told Reuters. While details of the tool are still scarce, it's a well-known fact that Facebook cooperates with the police, since, like any company, it has to abide by the law. In fact, just a few months ago, Facebook complied with a police subpoena by sending over 62 pages of photos, Wall posts, messages, contacts, and past activity on the site for a murder suspect.

For more information about Facebook's stance on working with the police, I checked out these two pages: Law Enforcement and Third-Party Matters, as well as Information for Law Enforcement Authorities. It's worth noting that neither of these documents discusses the aforementioned tool (a quick search for the words "monitor" and "scan" bring up nothing).

Facebook likely wants to avoid discussing the existence of the monitoring technology in order to avoid further privacy concerns. Many users don't like the idea of having their conversations reviewed, even if it's done by software and rarely by Facebook employees.
http://news.cnet.com/8301-1023_3-574...inal-activity/





Will Your Internet Provider Be Spying On You?

Internet service providers and media giants want to fight illegal downloading by monitoring it at the source - your computer.
Douglas Rushkoff

This month, if everything goes according to schedule, your Internet service provider may begin monitoring your account, just to make sure you aren't doing anything wrong with it -- like sharing copyrighted movie or music files. While we might all agree that copyright holders need to be protected, we may not all be equally happy about all of our communications being checked for violations. People and businesses who are not doing anything illegal may still have some things they wish to hide from their Internet access providers.

Under normal circumstances, your Internet service provider, or ISP, tries to protect you and your data from spying eyes. Cablevision, Time Warner Cable (an independent company no longer directly affiliated with TimeWarner, the parent of CNN and this site) and Comcast utilize all sorts of software to keep the connections between our modems and their servers safe. They also encourage us to keep our home networks secure from eavesdroppers.

But what are we supposed to do when the eavesdropper is the ISP itself?

This is the most disturbing question raised by a new alliance among America's biggest ISPs and media giants such as Disney, Sony and Fox, which is to go into effect this month. The effort, dubbed the Center for Copyright Information, hopes to combat the illegal downloading and sharing of movies and music by monitoring it at the source - your computer.

Until now, it was up to movie and music companies to figure out when their stuff was being illegally shared. This was a little tricky, because files aren't stored on just one user's computer. Hundreds or thousands of sharers have bits and pieces of stolen files, for downloaders to reassemble into songs or movies.

So movie companies have been searching online for copies of their own movies, identifying the locations of everyone from whom they received a bit of data. Then they contact the Internet service providers, who send letters of warning to subscribers' homes.
A number of clever workarounds, including certain kinds of encryption or the use of "proxy" servers in other countries, have helped advanced users of file-sharing software stay one step ahead of the movie companies. If a file sharer appears to be working out of New Guinea, say, the movie studio can't rely on a friendly ISP to find an illegal downloader here in the United States.

As I understand the new agreement and subsequent comments, which are about as cryptic as a copy-protected DVD, ISP's have agreed to implement a standardized "graduated response plan" through which offending users are warned, restricted and eventually cut off from the Internet for successive violations. The companies are supposed to be developing systems that keep track of all this, so that the letters and usage restrictions happen automatically. The fact that they are all agreeing to participate makes it harder for any one company to win the disgruntled customers of those who have been disciplined by another.

But now that they're free from individual blame, there's also the strong possibility that the ISPs will be doing the data monitoring directly. That's a much bigger deal. So instead of reaching out to the Internet to track down illegally flowing bits of their movies, the studios will sit back while ISP's "sniff" the packets of data coming to and from their customers' computers. While they're simply claiming to be protecting copyright holders, ISPs have a lot to gain from all this as well.

For instance, in many cases the Internet subscriber might have no knowledge of the infraction that the ISP detects. A houseguest might log onto one's home network simply to check e-mail. Because his sharing software might be running in the background (even when he's not downloading files himself) he is in effect sharing his own movie files wherever he goes. Your ISP sniffs the packets, so you are nabbed. The same is true for those of us who run "open networks" so that neighbors and others nearby can get free Internet access when they need it. (In the old days, that used to be considered polite.)

Once sharing a network connection becomes a legal liability, our already privatized access channels will become less a community resource. And the ISP's will have the pleasure of selling individual subscriptions to neighbors who used to share.

Worse, subscribers will be losing their expectation of privacy from their own service providers. While most of us aren't too worried about someone at an Internet provider seeing our messages to Aunt Sophie, businesses, law firms or hospitals who use the Internet to communicate privileged information might have more reservations.

If monitoring of data streams becomes de rigueur, what's to stop an ISP (or a particularly unscrupulous or bribable employee) from monitoring its competitors' communications? Admittedly, such scenarios are only as outlandish as the possibility that Murdoch newspapers could successfully bribe Scotland Yard.

As Internet security expert Josh Klein explained to me, "Honestly, the prohibition made more sense than this." To protect his own data, he already uses servers outside the United States, and fears other companies may soon feel the need to do the same: "The risk of losing their 'net [access] because someone accidentally streamed the wrong thing is a business prerogative significant enough to tunnel all their traffic to a country that provides sensible data privacy laws. How much long after that until the rest of the company gets off-shored?"

Whether the agreement promises to unleash such demons has yet to be seen. For the time being, though, the practice of preventing abuse by restricting peer-to-peer activity appears doomed only to escalate the arms race between consumers and their producers.

The longer term solution would be to develop an appropriate social contract: conducting ourselves online under the same civilized behavioral norms that keep us from, say, stealing stuff from one another's homes even though we could probably get away with it. It's not really that hard, and it's worth figuring out before the privilege of free interaction is taken away from us - along with any expectation of privacy.

Only by strengthening people's ability to distinguish between sharing and stealing will we be able to build a society capable of surviving our networks.
http://www.cnn.com/2012/07/06/opinio...ing/index.html





That’s No Phone. That’s My Tracker.
Peter Maass and Megha Rajagopalan

THE device in your purse or jeans that you think is a cellphone — guess again. It is a tracking device that happens to make calls. Let’s stop calling them phones. They are trackers.

Most doubts about the principal function of these devices were erased when it was recently disclosed that cellphone carriers responded 1.3 million times last year to law enforcement requests for call data. That’s not even a complete count, because T-Mobile, one of the largest carriers, refused to reveal its numbers. It appears that millions of cellphone users have been swept up in government surveillance of their calls and where they made them from. Many police agencies don’t obtain search warrants when requesting location data from carriers.

Thanks to the explosion of GPS technology and smartphone apps, these devices are also taking note of what we buy, where and when we buy it, how much money we have in the bank, whom we text and e-mail, what Web sites we visit, how and where we travel, what time we go to sleep and wake up — and more. Much of that data is shared with companies that use it to offer us services they think we want.

We have all heard about the wonders of frictionless sharing, whereby social networks automatically let our friends know what we are reading or listening to, but what we hear less about is frictionless surveillance. Though we invite some tracking — think of our mapping requests as we try to find a restaurant in a strange part of town — much of it is done without our awareness.

“Every year, private companies spend millions of dollars developing new services that track, store and share the words, movements and even the thoughts of their customers,” writes Paul Ohm, a law professor at the University of Colorado. “These invasive services have proved irresistible to consumers, and millions now own sophisticated tracking devices (smartphones) studded with sensors and always connected to the Internet.”

Mr. Ohm labels them tracking devices. So does Jacob Appelbaum, a developer and spokesman for the Tor project, which allows users to browse the Web anonymously. Scholars have called them minicomputers and robots. Everyone is struggling to find the right tag, because “cellphone” and “smartphone” are inadequate. This is not a semantic game. Names matter, quite a bit. In politics and advertising, framing is regarded as essential because what you call something influences what you think about it. That’s why there are battles over the tags “Obamacare” and “death panels.”

In just the past few years, cellphone companies have honed their geographic technology, which has become almost pinpoint. The surveillance and privacy implications are quite simple. If someone knows exactly where you are, they probably know what you are doing. Cellular systems constantly check and record the location of all phones on their networks — and this data is particularly treasured by police departments and online advertisers. Cell companies typically retain your geographic information for a year or longer, according to data gathered by the Justice Department.

What’s the harm? The United States Court of Appeals for the District of Columbia Circuit, ruling about the use of tracking devices by the police, noted that GPS data can reveal whether a person “is a weekly church goer, a heavy drinker, a regular at the gym, an unfaithful husband, an outpatient receiving medical treatment, an associate of particular individuals or political groups — and not just one such fact about a person, but all such facts.” Even the most gregarious of sharers might not reveal all that on Facebook.

There is an even more fascinating and diabolical element to what can be done with location information. New research suggests that by cross-referencing your geographical data with that of your friends, it’s possible to predict your future whereabouts with a much higher degree of accuracy.

This is what’s known as predictive modeling, and it requires nothing more than your cellphone data.

If we are naïve to think of them as phones, what should we call them? Eben Moglen, a law professor at Columbia University, argues that they are robots for which we — the proud owners — are merely the hands and feet. “They see everything, they’re aware of our position, our relationship to other human beings and other robots, they mediate an information stream around us,” he has said. Over time, we’ve used these devices less for their original purpose. A recent survey by O2, a British cell carrier, showed that making calls is the fifth-most-popular activity for smartphones; more popular uses are Web browsing, checking social networks, playing games and listening to music. Smartphones are taking over the functions that laptops, cameras, credit cards and watches once performed for us.

If you want to avoid some surveillance, the best option is to use cash for prepaid cellphones that do not require identification. The phones transmit location information to the cell carrier and keep track of the numbers you call, but they are not connected to you by name. Destroy the phone or just drop it into a trash bin, and its data cannot be tied to you. These cellphones, known as burners, are the threads that connect privacy activists, Burmese dissidents and coke dealers.

Prepaids are a hassle, though. What can the rest of us do? Leaving your smartphone at home will help, but then what’s the point of having it? Turning it off when you’re not using it will also help, because it will cease pinging your location to the cell company, but are you really going to do that? Shutting it down does not even guarantee it’s off — malware can keep it on without your realizing it. The only way to be sure is to take out the battery. Guess what? If you have an iPhone, you will need a tiny screwdriver to remove the back cover. Doing that will void your warranty.

Matt Blaze, a professor of computer and information science at the University of Pennsylvania, has written extensively about these issues and believes we are confronted with two choices: “Don’t have a cellphone or just accept that you’re living in the Panopticon.”

There is another option. People could call them trackers. It’s a neutral term, because it covers positive activities — monitoring appointments, bank balances, friends — and problematic ones, like the government and advertisers watching us.

We can love or hate these devices — or love and hate them — but it would make sense to call them what they are so we can fully understand what they do.
https://www.nytimes.com/2012/07/15/s...y-tracker.html





1,300,000 Reasons Why Mobile Phone Users Can't Expect Privacy
Antone Gonsalves

The new equation of modern life is simple: Use a mobile phone, give up any expectation of privacy. Cell phone carriers last year responded to some 1.3 million demands for information from law enforcement – and it’s a safe bet that plenty of the people caught up in those investigations were just average Joes.

Imagine you’re a teacher talking to a parent about his kid’s misbehavior in the classroom. To save time, the busy dad uses his mobile phone to discuss ways to discipline the rowdy child.

Now, to make this ordinary teacher-parent conversation more interesting, lets pretend the FBI believes the dad is a drug kingpin. Suddenly, the innocent teacher who is just doing her job becomes a part of a federal investigation. Why? Because the suspect used his cell phone.

That’s just one example of the privacy risks average Americans face today as law enforcement demands information on thousands of wireless subscribers each day. AT&T, Sprint, T-Mobile, Verizon Wireless and five other carriers collectively responded last year to 1.3 million demands for information stemming from local investigations into street crimes, financial crimes and intelligence investigations at the state and federal level, according to letters sent in response to a congressional inquiry.

Why So Much Data?

While cell phone surveillance has been used for some time in police work, very few people outside of the carriers knew how much information police were gathering. “I never expected it to be this massive,” Rep. Edward J. Markey told The New York Times. The Massachusetts Democratic requested the reports from the carriers, which had never been asked for such an accounting. The reports were released this week.

The carriers did not provide a breakdown of the information handed over to law enforcement - usually without any notification to the customers involved. However, carriers regularly collect and store on each subscriber the phone numbers called and received, the numbers used to send and receive text, how often email is checked or the Internet is accessed, and the subscriber’s location.

The Impact on Average Americans

While everyone agrees that the information can be useful in investigating suspected criminals, much of the data collected by law enforcement turns out be on people who are not involved in any criminal activity. That’s because police agencies often seek data on subscribers who were near a cell tower during a certain period of time. Such cell tower “dumps” can include hundreds or even thousands of names.

“This is very likely touching the average American,” said Jim Dempsey, vice president of public policy for the Center for Democracy and Technology. “Once you cross the million threshold, this is no longer a small possibility that your data is being scooped up.”

The assumption is law enforcement will separate drug dealers and terrorists from the dry cleaners, pizza delivery guys and schoolteachers. “But then again [the police might] say, ‘Wait a minute, drug dealer, schoolteacher? Maybe the schoolteacher is selling drugs to the kids,’ ” Dempsey said in painting a possible scenario. “ ‘Let's check out the schoolteacher. Let's go to the school and ask the principal.’ Suddenly, it is impacting innocent people.”

Why Privacy Is Threatened

Privacy rights advocates are not opposed to police gathering cell phone data in criminal investigations. What they decry is the lack of checks and balances to protect the innocent.

For one thing, law enforcement does not need court approval to collect mobile phone usage information. A prosecutor, the FBI or Drug Enforcement Administration need only issue a subpoena. And law enforcement can avoid even the subpeona requirement simply by declaring an emergency. The FBI in 2007 was widely criticized for improperly using emergency letters to gather thousands of records on phone numbers in counterterrorism investigations.

In their reports to Congress, carriers complained of muddled laws and said they sometimes refused to hand over data when their own legal departments suspected police were overstepping their bounds. But should it be left up to mobile phone companies to be the gatekeepers of privacy rights?

What Can Be Done?

If we don’t think mobile carriers are the right entities to make privacy decisions, Congress needs to update current laws to take into account advances in technology.

For example, wiretapping by police requires court approval because the information gathered is in real time. With cell phone data, the information is stored, so police need only a subpoena. In addition, there are no laws governing what happens to the data once it is in the hands of police, who do not have to reveal what they’ve collected and what they’ve done with the information.

“One of the real concerns that we have about electronic communications in general is there’s no requirement for any kind of transparency into how many requests were made or how the information is used, stored and shared,” said Chris Conley, technology and civil liberties attorney for the American Civil Liberties Union of Northern California.

More Information Needed

Not having that information makes it difficult for privacy rights advocates to determine what legal changes to lobby for. “It’s very hard for us to have an informed dialogue with our government, with our lawmakers, if we don’t know what’s going on,” Conley said.

Remember, last year's 1.3 million demands for information do not represent the actual number of people affected. Each request could involve a few to even thousands of mobile phone subscribers. With so many innocent people’s phone records getting scooped up by police, the privacy implications are huge.

“This is absolutely something that affects everyone,” Conley said. “Even if you don’t think you have anything to hide, you don’t necessarily want [police] to share your religious and political activities, attending a labor rally, going to a clinic for a health concern or playing hooky from work to go to a ballgame.”

The bottom line is there are lots of activities that people prefer to keep private, and current law and practice offer little recourse to ensure that they are protected.
http://www.readwriteweb.com/mobile/2...ct-privacy.php





Executive Order Grants Authority to Seize Private Communications Facilities

The White House has released a new Executive Order seeking to ensure the continuity of government communications during a national emergency. The Executive Order grants new powers to the Department of Homeland Security, including the ability to collect certain public communications information. Under the Executive Order the White House has also granted the Department the authority to seize private facilities when necessary, effectively shutting down or limiting civilian communications. In 2011, Congress considered similar provisions in cybersecurity legislation, which would have allowed the government to disconnect communications traffic in times of national security. Following public protest, congress abandoned the proposal. For more information, see EPIC: Cybersecurity Privacy Practical Implications.
https://epic.org/2012/07/executive-o...s-authori.html





Feds: We Need Priority Access to Cloud Resources

Federal report says before national security and emergency response workloads can be placed in commercial clouds, the government needs assurance resources will be available during emergencies
Brandon Butler

Federal agencies must be assured priority and uninterrupted access to public cloud resources before fully embracing the technology for national security and emergency response IT functions, a recent report finds.

The government's "Cloud First" policy mandates that as many applications and workloads be moved to the cloud as possible, but a report from the President's National Security Telecommunications Advisory Committee finds that cloud technologies related to service uptime, interoperability and security are largely not yet mature enough to handle some of the government's most sensitive workloads.

Will the federal government eventually move those national security and emergency preparedness (NS/EP) functions to the cloud? "If and when cloud computing can demonstrate a regime of policy, legal authority, security and oversight that is comparably rigorous, complete and trustworthy relative to those currently in place for NS/EP activities via legacy means, then the response is 'yes,'" the report states. But first, the cloud market needs to mature a little bit more.

No doubt there are benefits to embracing the cloud, the report states. Outsourcing IT functions to commercial cloud providers can reduce IT capital expenditures and the ability to scale up workloads creates more agility. But for NS/EP IT functions, cost savings are secondary. The priority is improved mission performance and being assured those resources are available during a national emergency. Downtime is unacceptable. "Fundamental requirements of NS/EP include a high degree of assured availability under any condition of stress; high measures of system and content integrity; confidentiality as required by specific missions; and mechanisms for priority access to resources in the performance of NS/EP functions," the report states.

The report's findings resonate as outages from major cloud providers have impacted customers in recent weeks. Amazon Web Services, for example, experienced a power outage during an electrical storm, knocking out service to some customers in late June. Salesforce.com, the major software-as-a-service (SaaS) provider, has had two outages in as many weeks.

The report lists some qualities of service level agreements (SLAs) that should be addressed for NS/EP functions to be moved to the public cloud. These include continuous monitoring of the cloud infrastructure by the provider, third-party audits, data encryption and various certifications and accreditations, including continuously evolving accreditation requirements from the Federal Risk and Authorization Management Program (FedRAMP).

Jamie Dos Santos, president of Terremark Federal Cloud and a member of the NSTAC, runs an infrastructure-as-a-service (IaaS) offering aimed specifically at public agencies and she says the government is in a unique position to push public cloud providers to meet the security standards needed to host NS/EP functions. She says it's a constant work in progress.

"Government agencies need to work with cloud service providers to design and implement business continuity plans that will ensure the availability of mission-critical data during national security and emergency situations," she says. "Ensuring that the cloud service provider has achieved and exceeded regulatory compliance for the security and reliability of the infrastructure powering their cloud environments is critical."

One way to ensure availability is to spread the workloads across multiple cloud providers, but that's difficult at this point, the report notes. Even if the federal government does encourage providers to meet certain security criteria, there is no guarantee those will be adopted across the entire industry. The lack of standards in the industry prevents the portability of workloads across various cloud providers, the report states.

So will the public cloud ever get to the point of being able to host critical government information? The report says federal government processes related to NS/EP will be ready to move to the cloud "if and when cloud computing can demonstrate a regime of policy, legal authority, security, and oversight that is comparably rigorous, complete, and trustworthy relative to those currently in place for NS/EP activities."

Dos Santos says many federal agencies are already moving swiftly to cloud infrastructures, such as the General Services Administration's email services and many of the Veterans Affairs IT functions. But there is a large portion of sensitive information that is not yet in the cloud, and the cloud market needs continuing maturation before it is.
https://www.networkworld.com/news/20...ud-260847.html





Russian Internet Censorship Diminishes the Entire Internet
Ted Greenwald

Russia's new Web blacklist is only the most recent of an alarming series of authoritarian moves to muzzle networked communications. National governments bent on censorship are eating away at the global, public Internet.

On Wednesday, the Russian Parliament's lower house approved legislation that would block Web pages selectively. The proposed law reportedly lets officials filter out specific domain names and IP addresses. Law enforcement agencies could add URLs to the blacklist without a court order. Hosting services would need to remove banned materials within 72 hours or risk being shut down.

Ostensibly, the law would protect children from pornography, drug abuse, suicide and information "harmful to their health and development." However, it's difficult to take this rationale at face value: Russia's government routinely crushes challenges to the status quo. The Putin regime has taken tight control over broadcast media and dragged its heels in investigating the murders of 26 journalists. It has fought U.N. resolutions that would compel it to respect human rights. Another bill currently in the Russian Parliament would increase penalties for defamation, while yet another would compel nongovernmental organizations that accept foreign financing to register as "foreign agents."

Ulterior Motives

The ulterior motive behind the proposed legislation isn't hard to figure out: The Internet has become central in coordinating antigovernment protest, and the new law would hand the government a Net-busting sledgehammer.

Russia's action is disturbing - but far from unique. Journalism watchdog Reporters Without Borders documents a rising tide of network censorship cases worldwide in its "Internet Enemies Report 2012." Egypt cut Internet access for five days in January 2011. Syria makes a habit of throttling bandwidth during political crises. Thailand blocks expression critical of the monarchy. Tajikistan blocks Facebook. And the impulse to censor isn't confined to habitually repressive governments: South Korea blocks North Korean propaganda, while India pressures service providers and hosting companies to block content that might inflame ethnic tension. Australia filters pages it deems objectionable. In the U.S., San Francisco Bay Area transit officials cut mobile service to disrupt the Occupy movement.

The mother of all Internet censorship programs is, of course, the infamous Great Firewall of China, which suppresses not only destabilizing dissent but discussions of history, religion, government corruption and social issues of all kinds - communications essential to the progress of a society undergoing rapid change, as all societies must in an era of exponential technology development.

The Role of the Resistance

Internet companies can play a critical role in resisting such censorship. Wikipedia, LiveJournal and the Yandex search engine have removed their Russian-language pages in protest. Internet giants like Google, Facebook and Twitter - sites that play a fundamental role in making the Internet work - would do well to join the resistance, not to mention companies such as Deutsche Telekom that keep Internet packets flowing. Their withdrawal of service would make a strong statement that the Internet is, by nature, global, and that the entire world has a stake in maintaining its integrity.

The Internet, according to Metcalfe's famous law, gains value exponentially with each additional node. Conversely, its utility degrades as nodes are removed. The creeping restriction of Internet traffic - no matter what the rationale - does incalculable damage to the Net as a whole.
http://www.readwriteweb.com/archives...e-internet.php





Eric Schmidt: The Great Firewall of China Will Fall
Josh Rogin

Technology and information penetration in China will eventually force the Great Firewall of China to crumble and even lead to the political opening of the Chinese system, according to Google Chairman Eric Schmidt.

Schmidt, who stepped down as Google's CEO last year, remains the head of Google's board and its chief spokesman. He roams the planet speaking to audiences and exploring countries where Google could expand its operations. He has been called Google's "Ambassador to the World," a moniker he doesn't promote but doesn't dispute. He sat down for a long interview with The Cable on the sidelines of the 2012 Aspen Ideas Festival last week.

"I believe that ultimately censorship fails," said Schmidt, when asked about whether the Chinese government's censorship of the Internet can be sustained. "China's the only government that's engaged in active, dynamic censorship. They're not shy about it."

When the Chinese Internet censorship regime fails, the penetration of information throughout China will also cause political and social liberalization that will fundamentally change the nature of the Chinese government's relationship to its citizenry, Schmidt believes.

"I personally believe that you cannot build a modern knowledge society with that kind of behavior, that is my opinion," he said. "I think most people at Google would agree with that. The natural next question is when [will China change], and no one knows the answer to that question. [But] in a long enough time period, do I think that this kind of regime approach will end? I think absolutely."

The push for information freedom in China goes hand in hand with the push for economic modernization, according to Schmidt, and government-sponsored censorship hampers both.

"We argue strongly that you can't build a high-end, very sophisticated economy... with this kind of active censorship. That is our view," he said.

The Chinese government is the most active state sponsor of cyber censorship and cyber espionage in the world, with startling effectiveness, Schmidt said. Google and Beijing have been at odds since 2010, when the company announced it would no longer censor search terms on Google.cn and moved the bulk of its Chinese operations to Hong Kong. That move followed a series of Gmail attacks in 2010, directed at Chinese human rights activists, which were widely suspected to be linked to the Chinese government.

More recently, Google has taken an aggressive approach to helping users combat government cyber censorship, by doing things such as warning Gmail users when Google suspects their accounts are being targeted by state-sponsored attacks and telling users when search terms they enter are likely to be rejected by Chinese government censorship filters.

Schmidt doesn't present Google's focus on state-sponsored cyber oppression as a fight between Google and China. Google's policy is focused on helping users understand what is happening to their accounts and giving them the tools to protect themselves, he explained.

"We believe in empowering people who care about freedom of expression," he said. "The evidence today is that Chinese attacks are primarily industrial espionage.... It's primarily trade secrets that they're trying to steal, and then the human rights issues, that obviously they're trying to violate people's human rights. So those are the two things that we know about, but I'm sure that there will be others."

Google still has hundreds of engineers working inside China and maintains a rapidly growing advertising business there. But the Chinese government is likewise doing a lot to make using Google difficult inside China. There are weeks when Gmail services run slow; then mysteriously, the service will begin running smoothly again, Schmidt said. The Chinese censors sometimes issue punitive timeouts to users who enter prohibited search terms. And YouTube, which is owned by Google, is not visible in China.

"It's probably the case where the Chinese government will continue to make it difficult to use Google services," said Schmidt. "The conflict there is at some basic level: We want that information [flowing] into China, and at some basic level the government doesn't want that to happen."

Meanwhile, Schmidt has been circling the globe looking for ways to expand Google's outer frontiers. His last international trip took him to four conflict or recently post-conflict states: Afghanistan, Libya, Pakistan, and Tunisia.

"I've become particularly interested in the expansion of Google in sort of wacky countries -- you know, countries that have problems," he said. "You can't really know stuff unless you travel and see it. It helps with your impressions and your judgment."

Schmidt believes that smartphone technology can have a revolutionary effect on how people in the developing world operate and he is researching how smartphone use can help fight corruption and bad governance in poor countries. He also sees Google's expansion into the emerging markets as a timely business move.

"The evidence is that the most profitable business in most countries initially is the telecom sector. The joke is that you know the Somali pirates have to use cellphones, and so the strongest and most fastest-growing legal business in Somalia is the telecom industry," he said.

The revolutions of the Arab Spring show that open information systems can encourage and enable political change, according to Schmidt.

"I think that the countries that we're talking about all had very active censorship regimes, and they failed to censor the Internet. They wired the phone systems, the television was controlled, the newspapers were controlled; it was very hard to find genuinely new dissident voices except on the Internet. So you can think of what happened there as a failure to fully censor, and so it's obvious why we feel so strongly about openness and transparency," he said.

Unlike in China, Google has taken a more active role in other parts of the world by developing tools to spread information that could be used to foster more active democracies, such as with its project to organize and disseminate election information and political candidate data in places like Egypt.

"We're helping with the elections. So we're trying to help them with getting information to the candidates, and these are countries where Google is central to the public sphere," Schmidt said.

Google is also expanding its role in compiling data on government actors and their actions to aid people in the fight against corruption, but here Schmidt warns that only when there is a legal system to prosecute bad actors will this data be transformative.

"You need the data, and then you need somebody who's willing to prosecute the person who lies," he said. "All you have to do is have the information and then the penalty that has to be applied in a fair way, and it would change these countries dramatically."

Information is not enough to topple regimes, but in the end, regimes that fight the openness of information are doomed to fail, he said.

"The worst case scenario is the citizens have enormous information and the government is completely unresponsive. That would be Iran, for example. At some point, that's unstable," said Schmidt. "At some point, it gets worse ... but before they overthrow the current leader, they have to have the information to do that. That's why transparency matters."
http://thecable.foreignpolicy.com/po...hina_will_fall





Kim Dotcom’s Extradition Hearing Postponed Until March 2013
Juha Saarinen

The United States’ court case against Megaupload founders Kim Dotcom, Mathias Ortmann, Finn Batato and Bram van der Kolk for alleged copyright infringement was dealt another setback Tuesday, after the New Zealand extradition hearing for the four was moved to March 2013.

Originally, the hearing was scheduled for August 6 this year, about six months after Dotcom’s home was raided in January, but a series of legal complications have pushed that date forward.

These include a High Court judge invalidating the warrants for seizing Dotcom’s property and funds — thus making the armed raid at dawn illegal. The judge also declared that the FBI shipping cloned hard drive images taken at the raid was unlawful, thanks to the warrants used being too broad and general.

Dotcom and his associates, who are now free on bail, face extradition to the United States, after being accused of conspiring to commit large-scale copyright infringement to the tune of $500 million. If convicted, they face 20-year prison sentences and million-dollar fines.

All the accused deny they were part of a conspiracy to commit copyright infringement, saying that Megaupload was a legitimate site for sharing files and that they complied with U.S. companies’ takedown notices, despite being a foreign corporation.

Kim Dotcom didn’t respond to Wired’s request for comment on the postponed extradition hearing, but on Twitter, accused the United States of “dirty delay tactics.”

Dotcom also railed against New Zealand Prime Minister John Key for refusing him due process and a fair defence, as he is entitled to as a permanent resident of the South Pacific nation.

In an earlier interview with Wired.com, Megaupload’s U.S. lawyer Ira Rothken says he expects the extradition hearing to take place no matter what happens as the legal process in Virginia and New Zealand grinds on.

“Dotcom is looking forward to his day in court, to present his side of the story,” Rothken says.

A hearing in the Federal Court of Virginia before Justice O’Grady is up next in the Megaupload legal saga.

Rothken has filed motions to vacate the orders that led to the seizure of Megaupload’s domain names and servers and says he is optimistic that O’Grady will do so.

He also expects O’Grady to order a hearing around the return of legitimate data belonging to Megaupload users. The users’ data was swept up in the confiscation of Megaupload’s assets by the US authorities, which have since then refused to return it to users.

According Rothken, the data people can’t get back include business files in Microsoft Word format, as well as family photographs.

Rothken also slams the U.S. prosecution, calling it “experimental”.

“This is the first time in U.S. history that a cloud storage company has been prosecuted for secondary copyright infringement,” Rothken says.

According to Rothken, twenty-five lawyers around the world – United States, New Zealand, Hong Kong and the Netherlands – are working on the Megaupload defense.

They are patient, Rothken says, but none have been paid yet. Rothken has applied for seized funds to be released soon to pay for Dotcom and Megaupload’s legal bills.
http://www.wired.com/threatlevel/201...ion-postponed/





Dotcom Offers US a Deal
Michael Field

Internet entrepreneur Kim Dotcom claims the United States criminal case against him is collapsing but he is offering to go there without extradition provided federal authorities unfreeze his millions of dollars so he can pay for lawyers and living expenses.

In a now hallmark style, he made the offer on Twitter.

"Hey DOJ (Department of Justice), we will go to the US," he tweeted, "No need for extradition. We want bail, funds unfrozen for lawyers & living expenses."

In an interview with The Hollywood Reporter Dotcom says the department knows it does not have a case.

"If they are forced to provide discovery, then there will be no extradition. That's why they don't want to provide discovery. If they had a case, they would not need to hide what they have."

Yesterday, his lawyers confirmed the extradition case on charges of criminal copyright violation stemming from the Megaupload file-sharing website had been shifted from next month to next year.

Dotcom and Finn Batato, Mathias Ortmann and Bram van der Kolk are wanted by the US following a dramatic January raid on his multi-million dollar residency outside of Auckland.

Dotcom tweeted about his disappointment at the delay:

"Extradition hearing delayed til March. Dirty delay tactics by the US. They destroyed my business. Took all my assets. Time does the rest.

"The NZ government is refusing an NZ resident due process and a fair defence. Shame on you John Key for allowing this to happen. Shame on you."

He told Hollywood Reporter that he believes "dirty delay tactics instead of evidence" are being deployed by the US government.

He said he wanted the August 6 hearing to go ahead so he could present his case.

"The actions by the DOJ clearly demonstrate that they don't have a case and that this ... was about killing Megaupload and creating a chilling effect to freeze the whole file-hosting sector. They achieved that," Dotcom said told Hollywood Reporter.

"I don't think they are prepared for the wave that's coming to them now."

The department declined comment.

Dotcom told Hollywood Reporter that because his assets have been seized, he has been left without "funds to pay my lawyers."

US District Court Judge Liam O'Grady who is overseeing the case against Dotcom, ruled after a June 29 hearing that while Dotcom's legal team could argue for a motion to dismiss the allegations against the company, the Megaupload founder's assets would not be unfrozen to pay attorney costs.

"The new rule is guilty until proven innocent," Dotcom said.

"My rights to due process and a fair defence are subverted."

Meanwhile Apple co-founder Steve Wozniak has repeated his support for Dotcom. Earlier this year he visited Dotcom in Auckland. According to Slashgear.com Wozniak told a conference in Chile he was dismayed at the techniques used to bring Dotcom to trial.

"Kim Dotcom was so successful, and he was well known for his flagrance, and his sports cars, and his racing cars, and style of life, that he was made an easy target" Wozniak said. "He was the biggest in the world, and they swamped in on him ... I don't want to take a side in this political thing, I don't know if that's where it came from."
http://www.stuff.co.nz/national/7258...fers-US-a-deal





How Big Music Threatened Startups and Killed Innovation
enigmax

An unprecedented new report has detailed how the destruction of Napster chilled a decade’s worth of innovation in the music industry. Through interviews with 31 CEOs, company founders, and VPs who operated in digital music during the period, we hear how Big Music collapsed startups, turned down ‘blank check’ deals, and personally threatened innovators with ruination for both them and their families.

By interviewing 31 CEOs, company founders and VPs who operated in the digital music scene during the past 10 years, Associate Professor Michael A. Carrier at Rutgers University School of Law has produced a most enlightening report on the decade long aftermath of the Napster shutdown.

The interviewees are no lightweights. Included are former Napster CEO Hank Bank, Imeem founder Dalton Caldwell, Seeqpod founder Kasian Franks, Real Networks founder Rob Glaser, Scour VP & General Counsel Craig Grossman, former Gracenote CEO David Hyman, AudioGalaxy founder Michael Merhej, founder of MP3Tunes Michael Robertson, former RIAA CEO Hilary Rosen, and numerous venture capitalists and label execs.

The result is an unprecedented report on how the shutdown of Napster chilled innovation, discouraged investment, and led to a climate of copyright law-fueled fear that pushed technologists and music further apart.

It started with a drain on cash. Interviewees reported that venture capital funding for digital music “became a wasteland”, a “scorched earth kind of place” housing a “graveyard of music companies.” With the big labels choosing where and when to sue, funding was hard to come by.

Nevertheless, some innovators didn’t give up, although when the labels were through with them many probably wished they had. The report details instances where innovators tried to get label approval but found themselves in extremely difficult situations.

One recalled that the labels “don’t license you if you don’t have traffic” but once enough footfall is achieved then “they want to get paid for ‘infringement’ and the longer it takes to license you, the larger the ‘infringement’ number they can justify charging you.”

Another described a litigation “Ponzi scheme” whereby settlements and other fees extracted from startups were used to fund the labels’ ongoing litigation strategy. However, like all Ponzi schemes there was a problem – maintaining momentum. “Once you stop suing new people there are no new settlements to pay for the ongoing litigation,” one interviewee reported.

But the labels weren’t always unreceptive to new ideas – as long as they were bad ones. The report notes that the labels were happy to take “big, up-front fees” of “10, 20 million bucks” from startups they knew wouldn’t make it. Carrier reports that a leading officer from one label admitted that they would “cripple the companies by demanding such advances and guarantees that they go belly up.”

Established services couldn’t make progress with the labels either, even when they did everything they could to avoid copyright issues. One, that boasted several million users and “interest from top-tier VCs – really the top of the top,” was also sued by the labels.

“After they sued us, our opening offer to them was: ‘You guys made your point; we will charge anything you want to charge, and you can take any percentage you want to take,” a respondent reported. “It was literally an offer of a blank check.” The labels refused and said they wanted the service shut down instead.

But for those who didn’t give in to the threats life could get very difficult, not just for their companies, but for them as individuals. The specter of personal liability often raised its head.

One innovator was told by the labels that his company would be left alone but he would be sued personally instead. “We can make all kinds of allegations and it’s your job to prove you’re not infringing,” he was told, with the labels adding that the lawsuit would cost him “between $15m and $20m.”

One of the respondents said it was “very scary” when the labels presented a “..multiple inch lawsuit for a couple billion bucks”, one with the potential to hang over his head for “the rest of [his] life.”

The threats also extended to the families of innovators. One was told it was “too bad” he had children “..who are going to want to go to college and you’re not going to be able to pay for it.”

Astonishingly, in some cases threats turned into actual violence. One respondent told Carrier about his experiences in the rap business of “people being physically intimidated” and “being hung out of windows.”

The strength of the threats were augmented by the uncertainty inherent in copyright law. One innovator said it was like a protection racket or the way politics work in corrupt countries where everything is OK until it’s not OK.

“You do what you want until one day you can’t and they come and your tail light’s broken.”

The full 63-page report, Copyright and Innovation: The Untold Story, is available here.
https://torrentfreak.com/how-big-mus...vation-120709/





Judge Rejects Key Universal Music Argument In Legal Fight With Grooveshark
Mike Masnick

Two and a half years ago, Universal Music (UMG) sued Grooveshark (or, really, its parent company Escape Media). The case has had a few twists and turns since then, but the judge has issued a ruling (embedded below) that is pretty clear in suggesting that Universal Music's key argument -- the the DMCA does not apply to pre-1972 songs -- was a massive overreach, and the court will not accept it. Separately, the court flat-out rejected UMG's attempts to have Grooveshark's counterclaims of tortious interference dismissed. There's no way to look at this other than a pretty big win for Grooveshark and a big loss for Universal, though the case is far from over.

On the key point, Grooveshark has long argued that what it does is really no different than what YouTube does, in that it allows individuals to upload content, and if it receives a takedown notice, it proactively follows the DMCA's takedown process and removes that content. Realizing that getting around the DMCA's safe harbors was a longshot, Universal Music instead reverted to a somewhat twisted argument, saying that pre-1972 sound recordings are not covered by the DMCA, and thus there are no safe harbor protections. To understand why they'd make this argument, you can read up on the history of pre-1972 copyrights for sound recordings -- a huge mess that the US Copyright Office is still trying to figure out how to fix. But, the short version is that, currently, sound recordings from before 1972 are not technically under US federal copyright law, but various (and often crazy) state laws. Since the DMCA refers to works under federal copyright law, Universal Music's arguments is that the DMCA doesn't apply, thus the safe harbors don't apply, and Grooveshark can't rely on its safe harbor compliance to avoid liability.

If this argument sounds somewhat familiar, that's because it's the same one EMI tried to use against MP3Tunes, which failed spectacularly. The NY state court in this case appears to be well aware of that, citing the MP3Tunes case at length.

An internet service provider which seeks to benefit from the safe harbor provisions of the DMCA is required, as a condition of receiving such protection, "expeditiously to remove, or disable access to, the material that is claimed to be infringing or to be the subject of infringing activity." .... Certainly the thrust of the DMCA is to relieve internet service providers of the initial need to ascertain the copyright status of the sound recordings that they make available, to place the burden of asserting copyright ownership on the owners of such copyrights, and to require the internet service providers to "take down" infringing material, upon receipt of a valid notice of infringement. There is no textual, or other reason, to think that Congress intended to limit that distribution of responsibilities to only post-1972 recordings.

Moreover, the phrase "copyright owners,".... is applicable to the owner of a common law copyright, no less than to the owner of a copyright under the Copyright Act....

End result? Sorry, UMG, but you can't just use this loophole to get around the clear and stated purpose of the DMCA's safe harbors.

This Court is not attempting to extend the Copyright Act to pre-1972 Recordings, but, nonetheless, does find, based on the relevant language of the statutes and the analysis discuss above, that the safe harbor provision codified by section 512(c)(1) of the DMCA is applicable to Pre-1972 Recordings.

That shoots a pretty big hole in UMG's case, as it's now going to have to show that Grooveshark's activities cause them to lose DMCA safe harbors, which is a much bigger hill to climb.

Separately, UMG failed in trying to get various counterclaims dismissed. The focus here was on claims that UMG contacted two companies -- HP and INgrooves -- to get them to back out of deals with Grooveshark. There are a bunch of different arguments (most pretty technical) that UMG makes to assert that these counterclaims should be dismissed, but the court isn't buying most of them. For each precedent UMG brings up, the court highlights that the facts are different here and UMG's reliance on particular caselaw "is misplaced."

UMG had a couple of relatively minor victories: having one of the counterclaims dismissed (one having to do with antitrust activity, because Grooveshark only showed harm to itself, rather than competition in general) and also a rejection of an attempt to use Section 230 safe harbors, which explicitly carve out intellectual property. Grooveshark/Escape Media tried a rather convoluted argument (sort of the reverse of UMG's pre-1972 DMCA argument, claiming that Section 230 safe harbors could apply to works covered under state copyright law). The court rejects this as silly, but it's effectively meaningless since it still grants the DMCA's safe harbors (which, admittedly are not quite as strong as the Section 230 safe harbors, but this is definitely the more reasonable result).

All in all, there's still a long way to go in this case, but today's ruling is clearly a pretty big loss for UMG and a win for Grooveshark.
http://www.techdirt.com/articles/201...oveshark.shtml





Copyright Fees on Music, Video, Struck Down by Top Court

The Supreme Court of Canada has decided that Internet providers do not have to pay copyright fees when their consumers download or preview music, and that teachers don't have to pay fees when they photocopy copywritten materials for their students.

Canada’s top court looked at five different cases that touched on tariffs set by the Copyright Board.

The court decided last year to take on all five cases at once, with the view that each of the cases centred on the same principles. On Thursday, it decided to respond to each appeal separately.

In one of the rulings, the court decided that there should be no fees levied against Internet service providers when their consumers download music.

In that case, some of Canada’s biggest ISPs argued that the wording of the Copyright Act was unclear on what constituted a telecommunication to the “public.”

The court ruled that the downloading of an individual file is not a “public” transmission. But it said that when music is streamed online, it is a “public” transmission and therefore fees can be levied.

“A stream of a musical work from the Internet is not a private transaction outside the scope of the right to communicate to the public,” the court said in its decision.

In another case, the court ruled that Internet providers should also not have to pay fees when music downloaders preview songs.

The Copyright Board decided in 2007 that there was nothing wrong with such previews because they were essentially “research.”

SOCAN, the Society of Composers, Authors and Music Publishers of Canada appealed that decision to the Supreme Court.

But the top court agreed that previews did not infringe copyright laws.

“The purpose of “research” should be analyzed from the perspective of the consumer as the ultimate user, not the online service provider. The Board properly considered the previews from the perspective of the consumer’s purpose, namely, conducting research to identify which music to purchase,” the court said.

In another key case, the court upheld the view of education ministers and school boards that photocopying material for students does not infringe the Copyright Act.

The educators had argued that the practice should be allowed because they fall well within the Copyright Act’s so-called “fair dealing” exemptions.

The court agreed and said it was important to consider the intentions of teachers when assessing whether photocopying works for students constituted “fair dealing.”

“There is no separate purpose on the part of the teachers in this case. They have no ulterior or commercial motive when providing copies to students,” the court said in its ruling. “They are there to facilitate the students’ research and private study and to enable the students to have the material they need for the purpose of studying.”

The decision is likely to have a major impact on schools, colleges and universities across the country, which have long paid millions of dollars annually for the right to make copies.

In another case, the judges found that movie theatres shouldn't be charged for the music that's part of a soundtrack.

The court ruled that a “soundtrack” that accompanies a movie is not the same as the Copyright Board’s definition of a “sound recording” because the soundtrack is meant to be part of the movie and includes pre‑existing sound recordings.

And finally, the court ruled that performance royalties do not need to be collected for music used in downloaded video games.

Telecom provider Bell on Thursday issued a statement on the rulings, saying: “We’re pleased the Court found royalties are not payable for soundtracks and previews. The Court’s decision regarding downloads and streaming is very complex and will take some time (to) study.”
http://www.ctvnews.ca/canada/copyrig...court-1.875726





Surprise Boom for Swedish Music Industry

The Swedish music industry has seen an increase in sales in the first half of 2012, with digital services like Spotify to thank for the boost, new figures show.

Music sales rose by 30 percent in the first half this year compared to the corresponding period in 2011, according to statistics from the Swedish Recording Industry Association (Grammofonleverantörernas förening - GLF).

Spotify and similar digital music services stood for a bulk of the increase, but the decline in CD-sales has also levelled out.

A total of 4.4 million CDs were sold in Sweden in the first six months of 2012, a decrease of just one percent on last year's sales.

Overall, music sales generated a total of 446 million kronor ($63.5 million), according figures from GLF.

Streaming services like Spotify stood for 253 million kronor ($36 million) of the sales, an increase of 79 percent.

Ludwig Werner, CEO of the International Federation of the Phonographic Industry (Ifpi), was surprised by the boom.

"It is of course very positive," he told the TT news agency.

"In our business, we have not exactly been spoiled with increases in sales in the past ten years."

The figures lend further justification to previous claims that Spotify has been helped resurrect the Swedish record industry.

In early 2012, digital music sales for the first time stood for more than half of the record industry's incomes.

While CD sales had fallen, proceeds from Spotify sales surged.

However, illegal file-sharing is also on the rise, especially among young people, despite stringent new laws designed to clamp down on the practice.

According to a survey conducted by the Lund University in January 2012, 61 percent of 15- to 25-year-olds in Sweden share music and other content online.

Earlier this month, Swedish and Danish Skype-founders founders Niklas Zennström and Janus Friislaunched launched, Rdio, a new music streaming service, in Sweden and Finland.

Rdio is seen as a Spotify rival and is also available in the US, UK, Canada, Brazil, France, Germany, Australia, New Zealand, Denmark, Spain and Portugal.

The service offers “millions of songs with no ads”.
http://www.thelocal.se/42000/20120713/





Tiny Antennas Save Streaming Internet TV Service
David Kravets

A federal judge on Wednesday refused to block a unique, antenna-based subscription service that enables the streaming of broadcast television to any internet-enabled device.

NBC, ABC, CBS, PBS, Fox and others sued Aereo, a $12 monthly subscription service that went live in New York in March. The suit claims that the upstart, backed by media mogul Barry Diller, has failed to acquire licenses from the networks who deliver their broadcasts over the air. They claimed the redistribution of the material, without a license, infringed their copyrights because it amounted to Aereo briefly buffering or copying the broadcast and “facilitating” a public performance without permission.

The case was being closely watched as many believed it could shape the manner and method by which people watch television in the future, and perhaps provide an early answer to the question of whether online television would be controlled by a stodgy industry that once shunned the VCR, or whether third-party innovators embracing technological advances have a chance to build on the openness of the public airwaves. The outcome could have ramifications in a different copyright infringement case the broadcasters brought against Dish Network, which recently unveiled a service that allows the automatic skipping of commercials.

Aereo’s New York customers basically rent two tiny antennas, each about the size of a dime. Tens of thousands of the antennas are housed in a Brooklyn data center. One antenna — unique to a customer — is used when a customer wants to watch a program in real time from a computer, tablet or mobile phone. The other works with a DVR service to record programs for later online viewing.

U.S. District Judge Alison Nathan said there were no copyright violations, and refused to shutter the service.

“Aereo’s antennas thus reinforce the significance of the copies its system creates and aid the court in finding that Aero does not create mere facilitating copies,” the judge wrote. While the ruling technically only rejects a preliminary injunction, the tone of the ruling makes clear that the broadcasters will, in all likelihood, lose the case if they choose to continue litigating against the upstart.

The broadcasters said in their suit that “no amount of technological gimmickry by Aereo — or claims that it is simply providing a set of sophisticated ‘rabbit ears’ — changes the fundamental principle of copyright law that those who wish to retransmit plaintiffs’ broadcasts may do so only with plaintiffs’ authority.”

The court, evidently, thought otherwise.

Chet Kanojia, Aereo’s chief executive, said “We said from the start that we believed that full and fair airing of the issues would reveal that Aereo’s groundbreaking technology falls squarely within the law.”
http://www.wired.com/threatlevel/2012/07/aereo-wins/




Verizon's Cable Deals Make Headway But Regulatory Doubts Linger
Diane Bartz

The telecoms regulator is prepared to approve Verizon Wireless' plan to buy airwaves from cable companies, according to people with knowledge of the situation, though the company still has to convince the Justice Department that the deal will not lead to higher prices for consumers.

Verizon Wireless, the biggest U.S. mobile provider, announced in December plans to buy spectrum from a consortium of cable providers, including Comcast and Time Warner Cable, for about for $3.9 billion.

Verizon Wireless is owned by Verizon Communications and Vodafone Group Plc.

The deal is seen as a game changer for the wireless landscape that would give Verizon an edge over rivals as mobile providers struggle to gather more spectrum to meet increased consumer demand for videos and other data-heavy services.

The Federal Communications Commission, which is taking the lead in assessing the spectrum portion of the deal, is prepared to approve it, according to two sources familiar with the matter.

Verizon has been aggressive in trying to win favor for the deal by transferring some airwaves to smaller wireless companies.

Late last month, Verizon and Deutsche Telekom's T-Mobile announced that they would swap some spectrum in a deal that paved the way for T-Mobile to drop its objection to Verizon's deals with the cable companies.

But Verizon is in much tougher talks with the Justice Department in hopes of winning agreement for two other much-criticized portions of the deal.

The Justice Department is skeptical about the marketing deals since they would mean collaboration between Verizon, the largest wireless company, and Comcast, the biggest cable company, according to one of the sources.

The fear is that there will be less head-to-head competition which could mean higher Internet and wireless plan prices.

The hope had been that Verizon would use its FiOS service to more aggressively push into Internet and cable, and that Comcast and other companies would compete more heavily in wireless products.

"They're a problem," said the source, who was not authorized to speak publicly, about the marketing agreements.

The other concerning component, the source said, is the creation of a "joint operating entity" between Verizon and the cable companies.

It is designed to develop new technologies, such as one that would allow consumers to move seamlessly between wired and wireless hookups, but critics say it could create cutting-edge technologies only available to the consortium.

"The Justice Department has big concerns about what mischief could be done in undefined agreements that would lock out competitors," said the source.

Talks are underway between the department and the parties, with no decision expected until August at the earliest.

Neither agency will sign off on the transactions until both are satisfied that any problems have been resolved.

"Obviously discussions remain ongoing, we're addressing concerns as they arise but all indications are that we will be closing on this as expected sometime later this summer," said Verizon spokesman Ed McFadden.

The Justice Department is weighing three options - it could sue to stop the side arrangements to the spectrum buys, it could seek to change them to prevent potential collusion, or it could monitor how the cross-marketing agreements that have already been put in place play out.

A Justice Department spokesman said the antitrust division was reviewing the transaction but declined to go into any detail. The FCC declined to comment.

The regulatory review of Verizon's spectrum deal comes just a few months after the Justice Department and FCC aggressively turned back AT&T's bid to buy rival T-Mobile USA.

AT&T said that $39 billion deal was critical to help it deal with the spectrum crunch in the United States, but regulators found that a merger between the second- and fourth-largest U.S. cellphone companies would hurt competition and raise prices for consumers.

Verizon's spectrum deal is smaller and unlike AT&T, Verizon has been proactive about selling off its less desirable spectrum to smaller rivals, a move welcomed by the FCC.

"Verizon comes out of this with a pretty good set-up for the next couple of years," said Harold Feld, legal director of public interest group Public Knowledge. "A number of other competitors also come out in decent shape." (Reporting by Diane Bartz; Editing by Tim Dobbyn)
http://www.reuters.com/article/2012/...8681AF20120709





Viacom Pulls "The Daily Show" Offline as a Result of Contract Dispute

The move comes after DirecTV dropped Viacom content from its network.
Cyrus Farivar

So, Viacom and DirecTV are unhappy with each other. Viacom wants more money, specifically, "a fee increase of more than 30 percent, amounting to more than $1 billion in additional costs over five years," according to Bloomberg. Some Viacom properties have seen ratings dips in recent months, most notably, Nickelodeon, reports Entertainment Weekly.

DirecTV doesn’t want to pay that much, and as a result, has dropped all Viacom programming, which includes Comedy Central (No Jon Stewart!), MTV, Nickelodeon and others from its customers' TV options.

So, in a tit-for-tat move, Viacom is now trying to get fans of its content to pressure DirecTV into calling the satellite provider by removing free episodes online, including "Jersey Shore" and "The Daily Show."

Public Knowledge, a public advocacy group, has called this move "unprecedented."

"Viacom has decided to take a service away from all Internet users in its attempt to punish DirecTV," wrote John Bergmayer, senior staff attorney, on the organization’s website on Wednesday.

"It is apparent that Viacom puts little stock in the Internet and the online future of video if it is willing to use all Internet users as a pawn in its negotiations. We hope that Viacom and DirecTV can work out their differences quickly so that people can continue to access Viacom's popular content lawfully."

Negotiations between the two parties are still ongoing. In the meantime, no one tell these guys about BitTorrent, ok?
http://arstechnica.com/business/2012...tract-dispute/





Yahoo Breach Extends Beyond Yahoo to Gmail, Hotmail, AOL Users
Nicole Perlroth

Another month, another major security breach.

Yahoo confirmed Thursday that about 400,000 user names and passwords to Yahoo and other companies were stolen on Wednesday.

A group of hackers, known as the D33D Company, posted online the user names and passwords for what appeared to be 453,492 accounts belonging to Yahoo, and also Gmail, AOL, Hotmail, Comcast, MSN, SBC Global, Verizon, BellSouth and Live.com users.

The hackers wrote a brief footnote to the data dump, which has since been taken offline: “We hope that the parties responsible for managing the security of this subdomain will take this as a wake-up call, and not as a threat.”

The breach comes just one month after millions of user passwords for LinkedIn, the online social network for professionals, were exposed by hackers who breached its systems. The breaches highlight the ease with which hackers are able to infiltrate systems, even at some of the most widely used and sophisticated technology companies.

Marcus Carey, a researcher at Rapid7, a security company found that among the data were some 106,000 Gmail e-mail addresses, 55,000 Hotmail e-mail addresses and 25,000 AOL e-mail addresses. Those e-mail accounts were not hacked; instead people had used their e-mail address as user names for a Yahoo service.

Sucuri, a company that checks for malware, set up a Web site, labs.sucuri.net/?yahooleak, that lets concerned users check if their account details were compromised in the breach.

Dana Lengkeek, a spokeswoman for Yahoo, said the compromised accounts belonged to Yahoo’s Contributor Network, and that fewer than 5 percent of the passwords posted were still valid.

Chris Gaither, a spokesman for Google, said Google immediately reset passwords for vulnerable Gmail accounts.

The hackers claimed to have stolen the passwords using a hacking technique called an SQL injection, which exploits a software vulnerability.

“We are fixing the vulnerability that led to the disclosure of this data, changing the passwords of the affected Yahoo users and notifying companies whose user accounts may have been compromised,” Ms. Lengkeek said in the statement.

Mr. Carey said it was unclear whether Yahoo’s breach had been contained and noted that hackers could still be inside its systems.

Computer security experts recommended that Yahoo users consider changing their passwords to other sites, as hackers tend to test those passwords across multiple sites.

They were quick to chastise Yahoo for allowing hackers such an easy way into its systems. “Why haven’t organizations like Yahoo got it yet? SQL injection is a known attack,” said Mark Bower, a vice president at Voltage Security. “If what is stated is true, it’s utter negligence to store passwords in the clear.”
http://bits.blogs.nytimes.com/2012/0...ail-aol-users/





Fake Bylines Reveal Hidden Costs Of Local News
David Folkenflik

Major newspapers in Chicago, Houston and San Francisco are among those this week that have acknowledged they published dozens of items in print or online that appeared under fake bylines.

As was first disclosed by the public radio program This American Life, the items in question were not written by reporters on the staffs of the papers at all but by employees of what is effectively a news outsourcing firm called Journatic.

The episode is at once a professional embarrassment for the papers and a reminder of an inescapable truth about the cost of gathering local news: Sometimes when you cut costs, you can't avoid cutting corners.

"How do you get police blotters from 90 towns? It's not easy. But that's what we do," says Brian Timpone, a former television reporter and small-town newspaper owner who created what became Journatic six years ago.

He built a company to provide a lot of news and information — mostly highly granular information — for publishers serving small communities around the country. The information in question involves such stuff as lives are made of: information about local arrests, real estate sales, weekly school lunch menus, high school track-meet results.

Even large papers with supposedly deeper pockets struggle for a solution.

"These are the challenges that newspapers face every day," Timpone says. "They're the most important ones, in our opinion. And we help you solve them."

News executives at the papers, and their parent companies, declined to talk about the specific incident, though each published news articles or statements about the episode. The Chicago Tribune, for example, said the matter is under investigation. But the newspaper's corporate parent, the Tribune Co., is a new investor in Journatic — evidence of its appeal. (Several other papers in the chain also rely on its services.)

Journatic has dozens of clients, many of them strapped for cash but all hungry to serve up local news for their readers. Many of the Hearst Co.'s papers are also subscribers. The Chicago Sun-Times had an arrangement that was to expire because of the investment by the rival Tribune Co. but announced it would sever its affiliation instantly in the wake of the radio program's report.

Critics argue that Journatic is operating on a fundamentally flawed premise.

"It's a short-term cost-cutting measure, and that's all it is," says Tim McGuire, the former editor-in-chief of the Minneapolis Star Tribune, who now teaches media business and journalism ethics at Arizona State University's Cronkite School of Journalism and Mass Communication. "It's not a long-term solution to providing local news to people who want it."

Journatic started as a smaller outfit called Blockshopper focusing exclusively on real estate information. Now it boasts 60 full-time employees and 200 freelancers, expanding to sports, crime and community events.

The company also hired more than 100 people abroad as a way of keeping costs down. That means people in Asia are writing about real estate in the Bay Area — and sometimes under fake bylines. Raw data appear in list form; small articlelike items a few paragraphs long also incorporate personal data such as alma maters and employers gleaned from Google searches or professional social media sites such as LinkedIn.

Journatic freelancer Ryan Smith told This American Life that he reworked pieces written by foreigners who were paid a pittance for their trouble and that he had written his own stories for papers in places he had never visited.

"I don't know those communities, and I have no stake in them. And so it didn't matter to me that I found out all the information and I got it right," Smith said. "There is just something inauthentic about the whole process. And the picking of fake names for these writers in the Philippines is just a symptom of that."

Journatic's Timpone concedes that the use of fake bylines was a mistake — but he said they were just real estate items with transactional data — like who bought what when — and shouldn't have had bylines at all.

Timpone said the bylines were added as a search optimization technique so the items would pop up in Google News searches. He also said that some of his colleagues have been subject to abuse online — and indeed a quick search appears to yield blogs set up to object to his company's aggregation of readily available information.

Tim McGuire says it may seem appealing, but newspapers that expect to rely heavily on Journatic are unlikely to be accepted by readers in the long term.

"They are engaging in deception, and some would even call it fraud," McGuire says. "They are pretending they are producing local news with people who are not local. I think it's naive to think that local news is only about things that happen locally. I believe local news also has to be locally produced."

Yet all of this plays out against a backdrop of cutbacks in the newspaper industry as paying print subscribers and advertisers peel away. According to one industry group survey, staffing levels have fallen by more than a quarter since the year 2000.

In some cases, newspapers are getting by with fewer than half as many journalists as they once did. The Tribune Co. has accelerated the consolidation of producing the news pages of its various papers throughout the country in Chicago, with the exception of its biggest paper, the Los Angeles Times.

The website PasadenaNow has only two editorial employees, including its editor and publisher, James Macpherson. When he announced that he would outsource the writing and reporting of some articles about the Pasadena City Council to India several years ago, it sparked an outcry. Now, Macpherson tells NPR, he commissions stories from American and British writers living largely in Mexico and the Philippines.

His site produces between 20 and 30 stories a day about Pasadena life. Most of them are not what a daily newspaper would consider hard news. But he says he does some original reporting that he shares with writers abroad — along with feeds of meetings of public officials and links to public documents. And then he edits and fact-checks the stories once they're done. Without that system, he says, the site would not exist.

"It's the only way I can turn a profit," Macpherson says.

And, indeed, some editors and innovators contend that salvation may lie in providing indispensable "hyperlocal content" — not just news but practical information about the communities of their readers. But such hyperlocal coverage is expensive. The experiment of the Patch network of blogs, owned by AOL, has to date failed to catch fire. And other major newspapers that have experimented with hyperlocal listings and coverage, including The Washington Post, have backed away, finding it too pricey.

GateHouse media, which owns more than 350 smaller daily and weekly papers, subscribes to Journatic but is replacing it with its own center for processing such material. Ten new employees, based in Rockford, Ill., will serve 30 of its papers, beginning next month. David Arkin, GateHouse's vice president for content and audience, says the company hopes to free up its reporters from more mundane tasks gathering data to do more challenging local reporting.

"It's a major time suck to do that kind of content," Arkin says of the hyperlocal listings. "As we look at what our content goals are in our organization, we need and want more enterprise storytelling. We want more 'what it means'-type stories and packages."
https://www.npr.org/2012/07/06/15631...-of-local-news
















Until next week,

- js.



















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