Peer-To-Peer News - The Week In Review - December 10th, '11

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"The Internet has dramatically increased the private non-commercial sharing of music, which we support." – Songwriters Association of Canada vice president Jean-Robert Bisaillon



































December 10th, 2011




Canadian Songwriters Want to Legalize File-Sharing
Ernesto

While most of the major entertainment industry companies wage war against BitTorrent sites, the Songwriters Association of Canada prefers to embrace file-sharing. Speaking with TorrentFreak, vice president Jean-Robert Bisaillon says that the Internet has revived the music business. Sharing music is part of people’s nature and the songwriters want to legalize file-sharing, while compensating the artists whose works are shared.

With prominent members such Bryan Adams, Eddie Schwartz, Randy Bachman and Carole Pope among its ranks, the Songwriters Association of Canada (SAC) is the voice of more than 1,500 Canadian artists.

In common with many of the groups tied to the music industry, SAC has a strong opinion about file-sharing. But unlike most of the others, they don’t want to shutter sites that allow people to share copyrighted music. Quite the opposite.

SAC believes that consumers should have access to all the music in the world, something that only file-sharing sites provide today. So instead of shutting these sites down the songwriters association wants to legalize file-sharing, while compensating the artists whose works are shared.

“People have always shared music and always will. The music we share defines who we are, and who our friends and peers are. The importance of music in the fabric of our own culture, as well as those around the world, is inextricably bound to the experience of sharing,” SAC writes in a detailed proposal.

According to the association, file-sharing should be framed as an opportunity rather than a threat to the music industry. To prove this point, SAC is trying to convince other stakeholders that it’s a good idea to monetize file-sharing through some sort of licensing system for consumers.

“Music file-sharing is a vibrant, open, global distribution system for music of all kinds, and presents a tremendous opportunity to both creators and rights-holders. Additionally, once a fair and reasonable monetization system is in place, all stakeholders including consumers and Internet service providers will benefit substantially.”

“By monetizing behavior rather than any specific technology, music creators and rights-holders will lay the foundations for a business model that can continue for decades rather than attempting the almost impossible task of trying to monetize the ever shortening cycle of changing technology,” SAC writes.

With the above, the Association indirectly criticizes the rigid stance of the major labels and the RIAA when it comes to technical innovation. Whether it’s the invention of radio, the cassette tape or file-sharing, they continuously view new technology as a threat instead of something that could help to expand the popularity of music.

To learn more about the ambitious proposal TorrentFreak got in touch with SAC vice president Jean-Robert Bisaillon, who told us that he hopes to make other key players in the music industry aware of the power and value of sharing.

“We think the practice [of file-sharing] is great and unstoppable. This is why we want to establish a regime that allows everyone to keep on doing it without stigmatizing the public and, instead, find a way for artists and rights holders to be fairly compensated for the music files that are being shared,” Bisaillon told us.

“Other positive aspects include being able to find music that is not available in the commercial realm offer, finding a higher quality of digital files, being able to afford music even if you are poor and being able to discover new artists or recommend them to friends.”

SAC’s vice president further notes that not everything the big labels do is in the best interest of musicians and artists. While Bisaillon recognizes that many artists still depend on these companies, he and other songwriters don’t necessarily agree with all their practices.

“The big labels will try to control the market as long as they can and as long as they think the market will generate revenue even if the revenue is the result of legal action. They will try to hook up with whichever commercial endeavor they think might help maintain their control in the marketplace even if this means unfair remuneration for content providers,” Bisaillon says.

“In parallel they will try to discourage any option that may diminish their control even if this means using threats or disinformation. They have the money and contacts to lobby governments in support for their vision. We see our role as developing and providing alternate means of access to music that are good for consumers and creators alike.”

According to Bisaillon the Internet is a blessing, perhaps not for the big music labels, but certainly for musicians and consumers.

“Music is much better off with the Web. The internet network allows for musical discovery despite distance and time of the day. It has sparked collaborations between musicians unimaginable before. It has helped artists to book international tours without expensive long-distances charges and postal delays we knew before,” he told us.

“The Internet has dramatically increased the private non-commercial sharing of music, which we support. All that is missing a means to compensate music creators for this massive use of their work.”

To make this final step SAC is actively talking to all the stakeholders involved, including consumer groups, rights holders and content providers to make their file-sharing license reality.

Although this final step may turn out to be a giant leap for most of the parties involved, it is essential that a prominent association of artists sees the upside to file-sharing. This is a welcome contrast to the repressive stance we are used to hearing from the RIAA and CRIA.

While the “monetize file-sharing” proposal is not necessarily ideal as it has many challenges of its own, SAC’s stance does touch the essence of the ‘problem’. Instead of adding restrictions, the music industry should find ways to give consumers unlimited access to all the music in the world for a fair price.
https://torrentfreak.com/canadian-so...haring-111206/





Kaspersky Dumps Anti-Piracy Group in SOPA Protest
enigmax

Security vendor Kaspersky has announced it will withdraw its membership of the Business Software Alliance (BSA) over the group’s support of SOPA. The Russian company, which is famous for its anti-virus products, says the pending legislation will hurt both innovation and consumers. In protest, Kaspersky will end its association with the BSA on January 1st 2012.

While the opinions of outright SOPA opponents are well documented, it came as a surprise last month when the Business Software Alliance (BSA), a former staunch supporter, published a blog post indicating it had some reservations on the pending legislation.

The BSA – which counts giants such as Microsoft, Apple, Adobe and Intel among its ranks – declared in their headline that SOPA Needs Work to Address Innovation Considerations.

Nevertheless, for BSA member and security vendor Kaspersky, it’s too little, too late.

In a clear protest against SOPA, Kaspersky has announced that on January 1st 2012 it will withdraw its membership of the BSA.

“Kaspersky has not participated in drafting the bill, nor participated in the debate on SOPA, and does not support this initiative,” the company said in a statement.

Kaspersky, one of the top anti-virus vendors in the world with a turnover in excess of half a billion dollars, is one of Russia’s leading technology groups. The 14-year-old company feels that the provisions of SOPA go too far, will hinder innovation, and hit end-users.

“We believe that such measures will be used contrary to the modern advances in technology and the needs of consumers,” the company added.

One of the other local companies that could be immediately hit by the introduction of SOPA is Russia’s own Facebook equivalent, VKontakte. The company is listed prominently in both the MPAA’s and RIAA’s lists of so-called “rogue sites”, with the latter describing the social networking site as a “reprehensible actor“.

But VKontakte spokesman Vladislav Tsypluhin says the company’s copyright problems are in the past.

“[The MPAA/RIAA letters] to the office of the U.S. Trade Representative were sent six months ago. After that we worked the system to work with copyright owners on the site,” Tsypluhin told Russia’s Izvestia.

“We have an arrangement with the U.S. Trade Representative’s office, they will check our copyright compliance, and then we will be excluded from the list of pirate sites.”

But despite Tsypluhin’s assertions that the US music and movie industry complaints against it are now outdated, the MPAA’s latest submission to the USTR is dated October 26th 2011 (the RIAA’s a little later) and VKontakte are still right there on the “rogue site” list.

Tsypluhin says that VKontakte now has a facility for copyright holders to inform the company that their rights are being violated on the site. These notices will be forwarded to the user who uploaded the unauthorized material and illegal content will be replaced by legal. Exactly how this last feat is performed is unclear. What is clear is that both the RIAA and MPAA remain unimpressed.

Kaspersky’s departure from the BSA will put more pressure on the trade group to further soften its support for SOPA, but whether it can do that while appeasing its existing members remains to be seen.
https://torrentfreak.com/kaspersky-d...rotest-111205/





SOPA Alternative Bill Would Shift Piracy Cases to Trade Commission
Scott M. Fulton, III

The U.S. International Trade Commission would be the court of first instance for disputes brought by parties claiming that a Web site hosted offshore is trafficking in its intellectual property, in a draft of a bi-partisan bill released today by Sen. Ron Wyden (D - Ore.) and Rep. Darrell Issa (R - Calif.). The Online Protection and Enforcement of Digital Trade bill (whose acronym is somehow "OPEN") is being offered as an alternative to the PROTECT-IP anti-piracy legislation which passed the Senate Judiciary Committee last May, but which has yet to come to a vote of the full Senate. The bill's House counterpart, the Stop Online Piracy Act (SOPA), is currently being debated by representatives.

USITC is already the principal court for resolving intellectual property disputes between American and foreign companies, so certainly no one yet can fault the bill lack of precedent.

But while the SOPA and PROTECT-IP bills both would empower the Attorney-General to order DNS server hosts and Internet service providers to stop resolving the addresses of suspected pirate sites, the Wyden-Issa bill would instead have a Commission judge issue a cease and desist order against the proprietor of the site once the judge has found the proprietor guilty of infringing activity.

"The OPEN Act would combat the flow of infringing digital goods into the United States by expanding the International Trade Commission's existing authority to enforce copyright and trademark infringement as it currently applies to the import of physical goods," reads a statement from Rep. Issa's and Sen. Wyden's offices, issued today. "While downloading a movie from a foreign-registered site is akin to importing a good from a foreign company, U.S. trade laws have failed to keep pace with the digital economy and have yet to extend the protections that U.S. rights holders enjoy in the physical world to the online world. The OPEN Act would expand those protections and empower U.S. rights holders to petition the ITC to investigate cases of illegal digital imports just as they currently petition the ITC to investigate infringement cases involving physical goods."

At the same time, the statement reads, the Wyden-Issa bill refrains from messing with the DNS system, while also providing what it characterizes as a clear definition of an infringing site, as opposed to SOPA's phrase "rogue site" which some say is legally fuzzy. The initial draft of Wyden-Issa states that a foreign infringer "is accessed through a non-domestic domain name; conducts business directed to residents of the United States; and has only limited purpose or use other than engaging in infringing activity and whose owner or operator primarily uses the site to willfully engage in infringing activity."

The SOPA bill (which takes some of its language from the un-voted-on COICA bill from 2010) would apply precedent in real estate law to enable the Attorney-General's office to pursue the Web sites of unreachable foreign proprietors, seizing their domains much the same way the FBI currently seizes foreign assets of suspected counterfeiters. The Wyden-Issa language would take foreign piracy matters out of the Attorney-General's hands almost entirely, employing the DOJ for consultation matters only, and reverting cases back to domestic authorities including the DOJ if it should be determined that the domain holder in question resides on U.S. soil after all.

Just like patent infringement cases today, piracy cases would be brought by individual complainants to the USITC. Conceivably the DOJ may act as a complainant on behalf of U.S. interests, although there's no language in the current draft that expressly states this. The Administrative Law Judge there would be given the authority, under the current draft, to issue temporary restraining orders while a case is being heard. These would be similar to temporary injunctions that the USITC grants today against the import or sale of foreign goods alleged to infringe upon U.S. patents or trademarks.

But the lack of a means to disable a suspect site if its proprietors cannot be located, may become a topic of debate should Wyden-Issa be brought before a committee for markup. When a complaint is filed against a site, USITC would have the obligation to notify the site's proprietors. It would use the e-mail or mail address listed on the site itself (which you don't generally find on a pirate site); or, barring that, the mail address listed in the domain registry (which is often hidden or falsified); or finally, when all else fails, "any other such form as the Commission finds necessary."

Just last October, the Federal Circuit Court of Appeals ruled that the USITC does have the authority to use its own means outside the U.S. to investigate cases of alleged unfair competition. Conceivably, that authority could also be extended to include investigations of illicit intellectual property trafficking outside U.S. borders.

The latest statements of opposition to SOPA and PROTECT-IP published this week, including from legal scholars, assert that the bills would have detrimental impacts on Americans' free speech rights. But the new support group established to promote the Wyden-Issa bill, launched at KeepTheWebOpen.com, is noticeably refraining from invoking the free speech argument, perhaps in order to retain vital Republican support necessary for this language to be passed by the GOP-controlled House.

"The OPEN Act secures two fundamental principles," the new site reads. "First, Americans have a right benefit from what they've created. And second, Americans have a right to an open Internet. Our duty is to protect these rights. That's why congressional Republicans and Democrats came together to write the OPEN Act. But it's only a start."
https://www.readwriteweb.com/enterpr...l-would-sh.php





Shockingly Unshocking: Two Congressional Staffers Who Helped Write SOPA/PIPA Become Entertainment Industry Lobbyists
Mike Masnick

Two high level Congressional staffers who have been instrumental in creating or moving forward both PROTECT IP (PIPA) and SOPA have left their jobs on Capitol Hill and taken jobs with two of the biggest entertainment industry lobbyists, who are working very hard to convince Congress to pass the legislation they just helped write. And people wonder why the American public looks on DC as being corrupt.

Allison Halataei, former deputy chief of staff and parliamentarian to House Judiciary Chairman Lamar Smith (R-Texas), and Lauren Pastarnack, a Republican who has served as a senior aide on the Senate Judiciary Committee, worked on online piracy bills that would push Internet companies like Google, Yahoo and Facebook to shut down websites that offer illegal copies of blockbuster films and chart-topping songs.

Pastarnack went to the MPAA where she'll be "director of government relations" and Halataei to the NMPA (music publishers and songwriters) where she'll be "chief liaison to Capitol Hill." The Politico article linked above notes that this kind of "revolving door" is all too common. It may not be directly corrupt, but to the public it sure feels corrupt. It certainly gives off the appearance of "hey, write us the insane bill that we want, and then we'll reward you with a super cushy high paying job." At the very least, it should raise significant questions about whether or not these two bills were written with the public's interest in mind (I know, I know, don't laugh....) or their future employers'. Technically, neither of them can directly lobby the specific committees where they worked, but they can certainly assist in the process.

“They can provide invaluable insight to people on the outside — even in the consultation mode,” one tech industry lobbyist said, noting that Halataei had been Smith’s secondhand person and knows how the Texas Republican thinks and what would be an effective lobbying strategy.

Additionally, the Senate and House panels work closely together, and both Halataei and Pastarnack have ties to staffers in the chambers they didn’t serve in and aren’t banned from lobbying.

Also, as the Politico article notes, a year from now, you can bet there will still be fights about either this or similar legislation. American politics is a disaster.
http://www.techdirt.com/articles/201...obbyists.shtml





Chinese Internet Users Relish Irony Of SOPA's Great Firewall Of America
Mike Masnick

After being on the receiving end of the West's pointed comments about the Great Firewall of China and the online censorship it helps to enforce, Chinese Internet users are enjoying the deep irony that SOPA will effectively copy China's approach by creating a Great Firewall of America. As one wrote:

It looks like that we can finally export our technology and value to the Americans. We’re strong, advanced, and absolutely right!

The same post on Global Voices Online reports that others are taking things more seriously, and worry about the knock-on effects SOPA will have on Net freedom around the world:

Most Chinese-language blogs and microblog messages emphasize the disastrous outcomes that the bill could bring. What people worry about most are bill's endorsement of surveillance by web services and Internet companies to prevent “infringing” content, and the implications for individual privacy.

None of this will come as any surprise to Techdirt readers. But it's extraordinary that the politicians supporting SOPA can't see – or don't care about – the huge damage it will do to the international reputation of the US, and the harm it will cause human rights around the globe.
http://www.techdirt.com/articles/201...-america.shtml





MPAA Boss: If The Chinese Censor The Internet Without A Problem, Why Can't The US?
Mike Masnick

The MPAA is getting pretty desperate, it seems. MPAA boss Chris Dodd was out trying to defend censoring the internet this week by using China as an example of why censorship isn't a problem. It's kind of shocking, really.

"When the Chinese told Google that they had to block sites or they couldn't do [business] in their country, they managed to figure out how to block sites."

Is that really what Chris Dodd wants the US government to aspire to? To setting up its own Great Firewall?

His other comments were almost as ridiculous:

"How do you justify a search engine providing for someone to go and steal something?" he asked rhetorically in a recent interview at the Society of Motion Picture and Television Engineers conference. "A guy that drives the getaway car didn't rob the bank necessarily, but they got you to the bank and they got you out of it, so they are accessories in my view."

But that completely misunderstands and misrepresents the situation. Google isn't the driver. Google is the car manufacturer. Do we sue Ford as an accessory?

It's this sort of ridiculousness that makes it so difficult to take Dodd and the MPAA seriously in these discussions.
http://www.techdirt.com/articles/201...-cant-us.shtml





Feds Seize Domain Names of Korean Movie Portals
Ernesto

Homeland Security’s ICE unit has started the ninth phase of Operation In Our Sites. Following on from last week’s action targeting online shops selling counterfeit goods, US authorities have just seized the domain names of 11 Korean movie download portals. For the first time since the seizures began the banner has been updated to include Korean language.

The Department of Justice (DOJ) and Immigration and Customs Enforcement (ICE) have confiscated another 11 domains names, all related to Korean movie portals.

The seizures are another iteration of “Operation In Our Sites”, the domain name seizing initiative designed to crack down on online piracy and counterfeiting.

This weekend’s actions are the first to target a range of sites that are not directed at the US public. For this purpose the seizure banners, which replace the site’s original content, are now updated to include a message in the Korean language.

The following domains are confirmed to be part of the most recent crackdown: 007disk.com, 007disk.net, 82movie.com, 82movie.net, 82us.com, bzserv.info, itvwmg.com, ktvwmg.com ,wmgitv.com, wmgus.com, wmgus.net.

The seizures were signed off by a US District Court and all 11 domain names are now in the custody of the federal government. On first inspection, the majority of the sites offered access to downloads of the latest Hollywood blockbusters for a small charge.

Interestingly, and this is also new, the domain names are connected to one company, World Multimedia Group, Inc. So despite the fact that the sites were targeted at Korean speaking visitors, the websites appear to belong to a Seattle-based company.

The authorities have yet to comment on this latest round of domain seizures, but we assume that it will be justified as another attempt to protect the commercial interests of US companies.

“Intellectual property crimes harm businesses and consumers, alike, threatening economic opportunity and financial stability, and today we have sent a clear message that the Department will remain ever vigilant in protecting the public’s economic welfare and public safety through robust intellectual property enforcement,” Attorney General Eric Holder said a few days ago, responding to the previous seizure round.

In total the federal government has now seized more than 350 domains as part of Operation In Our Sites.

Previously these actions have been heavily criticized, as opponents argue they violate due process and several other constitutional rights. Thus far these concerns haven’t held back the authorities from going after piracy and counterfeit related domains.

And it could be just the start. If the pending Protect IP and SOPA bills are signed into law in their current form, the seizures will be further legitimized and increase the rate at which domain names are taken in custody.
https://torrentfreak.com/feds-seize-...ortals-111204/





Feds Return Mistakenly Seized Domain After a Year of Smoke and Mirrors
enigmax

Just over a year ago, Homeland Security's Immigration and Customs Enforcement (ICE) seized dozens of domain names as part of Operation in Our Sites. The lawyer for one of them, music blog Dajaz1, has been furiously trying to find out about the site’s case and now, after a year of smoke, mirrors and stonewalling, the Feds have done the previously unthinkable – they’ve given the domain back.

During November 2010, the U.S. Government seized a range of domain names said to be infringing on copyright. While few mourned the loss of 2009jerseys.com, nfljerseysupply.com, throwbackguy.com, cartoon77.com, lifetimereplicas.com and handbag9.com, others generated much more interest.

Among them was DaJaz1.com, a site from which Special Agent Andrew Reynolds said he’d downloaded pirated music. But there was a problem. Persistent reports suggested that the songs had been legally provided to the site by record labels for the specific purposes of distribution to fans, a point later raised by Senator Ron Wyden. One ‘leak’ even came from a boss at a major music label.

Now, more than a year later, the whole case has just come alive in the most dramatic way possible. Has DaJaz1 just been deemed a full-blown rogue site run by criminals, as the ICE notice displayed on the domain for a year suggested? Hardly – the Feds have just given their domain back because there is no case to answer.

As can be seen here, DaJaz1 is back online and according to Techdirt it’s been an epic effort.

After initially ignoring requests from DaJaz1 lawyer Andrew P. Bridges to return the domain, the U.S. government indicated it would begin the necessary forfeiture procedure. Bridges said he would submit a forfeiture challenge but the deadline for the government to file apparently came and went with no visible action.

Bridges was told that extensions to file for forfeiture had been granted to the government but he questioned how this had been possible without him being informed and given the chance to contest. He asked for copies of the documentation requesting the extension and the court’s documentation granting it, but on each count he was denied and told the papers were under seal.

Incredibly, he was told he wouldn’t be informed of future extensions nor given a chance to contest them either, which was problematic since extension after extension was apparently granted. However, nothing could be officially confirmed by Bridges since the paperwork remained secret.

So here we are in December 2011 and surprisingly the government has just decided that it will need no more extensions, since it will not file a forfeiture complaint after all. The reason? Because there is no probable cause.

This means that following a request from Bridges, DaJaz1 now have their domain back. They are back in business and are displaying an anti-censorship, anti-PROTECT IP, and anti-SOPA banner on their website.

If a poster boy was ever needed to show why these domain seizures without a fair process are just flat-out wrong, today SOPA opponents have one.
http://activepolitic.com:82/News/201...d_Mirrors.html





Senator Wants Answers from DHS Over Domain Name Seizures
David Kravets

Sen. Ron Wyden (D-Oregon) said Friday he would demand answers from the Department of Homeland Security about its domain seizure program known as Operation in Our Sites after it was revealed that the government kept a hip-hop music review site’s name for a year without affording the owner a chance to challenge the seizure.

Wyden also wants to know why there was no court record of the case, other than the initial seizure filing a year ago.

“I expect the administration will be receiving a series of FOIA [Freedom of Information Act] requests from our office and that the senator will have very pointed questions with regard to how the administration chooses to target the sites that it does,” said Jennifer Hoelzer, a Wyden spokeswoman. She said the senator was “particularly interested in learning how many secret dockets exist for copyright cases. There doesn’t seem to be an obvious precedent or explanation for that.”

Wyden’s interest comes a day after federal authorities returned the domain name dajaz1.com, which was back online greeting visitors Friday with a powerful message about proposed web-censorship legislation that expands the government — and copyright holders — power to shutter and cripple sites suspected of copyright infringement.

The federal government already has the power to seize web domains under the same forfeiture laws used to seize property like houses, cars and boats allegedly tied to illegal activity such as drug running. A year ago, it started invoking that law against sites marketing and trafficking in counterfeit goods, unauthorized sports streaming and unauthorized music — seizing more than 350 domain names in all.

One of those sites caught in that crackdown was dajas1.com. Operation in Our Sites, run by the Department of Homeland Security, accused the site of allowing its users to download pre-release music. But as it turns out, some of that music was sent to the popular blog by the artists or labels.

The site’s homepage on Friday was dominated by a video pointing to alarming legislation known as the Protect IP Act — which is stalled in a procedural muck — that a Senate committee passed months ago basically giving copyright owners the right to shutter websites believed to be dedicated to infringing activities. Judicial oversight is not needed. In a recent editorial, we spoke about such dangers that this and a similar proposed House measure are ripe for abuse. After all, if the movie industry had its way, the VCR would have been outlawed.

Techdirt disclosed Thursday that for a year, the government refused to allow the site’s owner, who goes by the moniker Splash, to challenge the November 2010 seizure of the domain name by the Immigration and Customs Enforcement office, which is a branch of DHS. The only publicly available court record regarding the seizure was the initial filing of a court order a year ago. Everything else was sealed — invisible to Splash, his lawyer, the public and the press. On Thursday, the site was returned to the owner of the Queens, New York-based site with the only explanation being that forfeiture was unwarranted.

ICE’s complaint against the site listed four songs that the site allegedly linked to in violation of copyright law. Three of them were e-mailed to Splash by record executives associated with labels that belong to the Recording Industry Association of America, which helped create the complaint.

“It’s not my fault if someone at a record label is sending me the song,” Splash told The New York Times last year.

His attorney, Andrew Bridges of San Francisco, said in a telephone interview Friday that the issue underscores that “powerful corporate copyright interests have taken advantage of the post 9-11 era to obtain the services of Homeland Security to enforce commercial interests.”

The Immigrations and Customs Enforcement’s public response to keeping Splash’s property for a year, without due process, boils down to a belief that it’s acceptable collateral damage:

Operation In Our Sites utilized the civil forfeiture statute provided by Congress for intellectual property theft to seize domain names of 350 separate websites engaged in copyright or trademark violations. In each instance, ICE, working with our partners at the Department of Justice, demonstrated the requisite probable cause to a federal magistrate judge to justify the seizure of the website. This process is the same that federal law enforcement uses for seizures of all types. During the subsequent forfeiture process, law enforcement continued not only to investigate potential criminal wrongdoing, but to objectively consider all applicable evidence resulting from the ongoing investigation. The goal of every law enforcement operation is to ensure a just result. In the case of this domain name — out of 350 seized — the government concluded that the appropriate and just result was to decline to pursue judicial forfeiture.

It just seems wrong that the United States would seize somebody’s property without affording any opportunity for a challenge — and ICE has tried to say that sites can fight back.

The Justice Department told Wyden in May that the Operation in Our Sites would indeed allow targets an opportunity to challenge the seizure. The only known challenge so far to Operation in Our Sites was by the Spanish site Rojadirecta, which prevailed on First Amendment grounds Wednesday.

“Property owners are are entitled to challenge the forfeiture of their property, in which case the government would be required to demonstrate the basis for forfeiture by a preponderance of the evidence,” Ronald Weich, an assistant attorney general, wrote Wyden in May. “Even where the government can demonstrate that property was used to commit a criminal offense, an innocent owner who was unaware of the criminal activity, or who took reasonable measures to notify law enforcement upon learning of the criminal conduct, may nevertheless avoid forfeiture.”

The dajaz1.com seizure was based on an investigation from the RIAA, which said in a statement that for the 18 months before the site was seized, “nearly 2,300 recordings linked to the site were removed from various file-sharing services.”

“We are aware of statements by the site operator that suggest that music companies themselves were the source of at least some of the thousands of recordings available on Dajaz1. Even assuming this to be accurate, it does not excuse the thousands of other pre-release tracks also made available which were neither authorized for commercial distribution nor for uploading to publicly accessible sites where they were readily downloadable for free,” the RIAA said in a statement.

Apparently the RIAA is none too happy about the dajaz1.com site being given back, and suggested it was returned for “technical issues.”

“If the site continues to operate in an illegal manner,” the RIAA said in a statement, “we will consider all our legal options to prevent further damage to the music community.”
http://www.wired.com/threatlevel/201...omain-seizure/





RIAA Spokeswoman Attempts to Rewrite History Claiming File Sharing Lawsuits Succeeded
Rich Fiscus

RIAA spokeswoman attempts to rewrite history claiming file sharing lawsuits succeeded Some days you have to wonder if anyone at the RIAA actually reads their official statements before unleashing them on the public. At the very least maybe they should check to see if they pass the giggle test.

The latest bit of nonsense is a submission to the Opinion section of a Nashville, Tennessee newspaper claiming the reason they stopped suing P2P users was because the campaign was successful, and the job completed.

The original article in The Tenneseean, which was primarily about how much the recording industry spends on lobbying, said:

The focus on lobbying and campaign contributions comes after the music industry?s use of a tactic, now almost universally acknowledged as a failure, in which it filed lawsuits against individuals accused of illegally downloading songs to stop piracy.

The record industry filed nearly 30,000 suits, which proved to be a poor public relations strategy as stories of teens, college students and families taken to court emerged. The suits ultimately proved ineffective in ending systematic online piracy.

Since then, the music industry?s overall lobbying expenses have more than doubled beginning in 2007, when music business interests spent $7.1 million on lobbying, to 2009, when the industry spent $17.5 million.

Liz Kennedy, Communications Director for the RIAA, shot back, writing:

We never expected to 'end' piracy. The goal is to bring the problem under sufficient control so that lawful businesses can compete and the industry can earn enough to protect jobs and invest in new bands.

Our legal efforts served as an essential educational tool: Fans know far more now about copyright laws and the legal consequences of stealing music than ever before. Before initiating lawsuits in 2003, only 35 percent of people knew file-sharing on P2P was illegal; afterward, awareness grew to 70 percent.

To call this misleading would be an understatement. For starters, we already knew why the RIAA stopped their lawsuits. It was a simple question of cost/benefit analysis. The lawsuits were expensive and alienated users while producing basically no results.

In fact, the RIAA did not stop their attacks on P2P users. They simply shifted their focus to lobbying and working out deals with ISPs to kick users off the Internet, which had been their stated goal for some time.

At the same time, lawyers working for a prominent Washington DC law firm, Jenner & Block, who also happened to be major players in the RIAA's lawsuit strategy, were appointed to key Justice Department positions. One of them, Don Verilli, is now the Solicitor General of the United States.

That means his duties include presenting arguments on behalf of the government in federal court. He's certainly no stranger to arguing the RIAA's position in court. He was the lead attorney for the entertainment industry in the Grokster case.

As to Kennedy's assertion that the RIAA was fighting to preserve legal online music services, that is almost not worth responding to. In fact those services had to drag the labels kicking and screaming into offering downloads in the first place.

It was label mandated DRM, not file sharing, that created the biggest barrier to legal sales. Removing the DRM boosted sales in online music stores, something else the labels had to be coerced into. RIAA lawsuits had nothing to do with it.

And finally, it's simply laughable to suggest people weren't aware sharing music over P2P networks was legal before the lawsuits began, or that they really care now. The music industry's lawsuit against Napster was one of the most high profile cases in recent memory. It certainly got more press than the lawsuits against individual file sharers.

Of course, as we know from numerous studies, people share music and other content online because they think it's okay.

It's hard to say which is more troubling, that the RIAA could believe people will take this sort of statement seriously or that they might believe it themselves.
http://www.afterdawn.com/news/articl...uits_succeeded





RIAA Label Artists & A-List Stars Endorse Megaupload In New Song
enigmax

MegaUpload is currently being portrayed by the MPAA and RIAA as one of the world’s leading rogue sites. But top music stars including P Diddy, Will.i.am, Alicia Keys, Snoop Dogg and Kanye West disagree and are giving the site their full support in a brand new song. TorrentFreak caught up with the elusive founder of MegaUpload, Kim Dotcom, who shrugged off “this rogue nonsense” and told us he wants content owners to get paid.

By now readers will be all too familiar with the rhetoric of the mainstream music and movie industries. So-called foreign “rogue sites” steal American content, steal American money, cost American jobs and damage the economy, the lobbyists insist.

While many BitTorrent sites of all shapes, sizes and directions are listed as “rogue” by both the RIAA and MPAA, these groups also define many cyberlocker services using the same terms. Heading up that particular list are the world-famous Megaupload and Megavideo, two companies founded by the larger-than-life character Kim Dotcom.

In a recent video (skip to 5m 10s) from Creative America, Kim is portrayed as an evil baddy, sucking the life blood from the creative industries. But today, Creative America, the RIAA and MPAA will have the shock of their lives.

“You should checkout the Mega Song and video. Hope you like it,” Kim told TorrentFreak. Somewhat intrigued we did, and we have never – EVER – seen anything as audacious as this before.

In a 4 minute track produced by Printz Board, P Diddy, Will.i.am, Alicia Keys, Kanye West, Snoop Dogg, Chris Brown, The Game, Mary J Blige , Kim Kardashian, Floyd Mayweather, Jamie Foxx and more sing about how wonderful Megaupload is.

“When I got to send files across the globe, I use Megaupload,” declares Will.i.am, an artist signed to labels owned by RIAA-members Warner and Universal.

“When i’m sending my hits out I use Megaupload, ‘cos it’s fast. I can receive hits and I can send ‘em out,” declares P Diddy, an artist signed to Interscope, a label owned by Universal.

Kanye West, signed to Universal-owned Def Jam, likes to use Megaupload “…because it’s the fastest and safest way to send files – period.”

Alicia Keys, who is signed to Sony-owned RCA, says she uses Megaupload “….because I know that I can get my music safely and quickly -and you know that i’m serious about my music.”

Snoop Dogg, signed to EMI-owned Priority, uses it “…because it keeps the kids off the street,” and The Game (Universal) says that even his lawyers know he uses it, “…and I got plenty of them.”

This stunning PR coup is a huge feather in the cap of Megaupload but Kim, who certainly has a colorful and sometimes chaotic past, seems to be taking it all in his stride. Far from the crazy character portrayed in the media, he was courteous and measured while speaking with TorrentFreak about this public support from the stars, and the behind-the-scenes support already being received.

“Amongst our 180 million users is a large number of celebrities, musicians, film makers, actors, etc. and they love Mega. We have hundreds of premium accounts from employees of the companies the RIAA and MPAA represent. In fact 87% of the fortune 500 companies have premium accounts with us,” Kim told us.

So what of Mega’s apparent rogue site status, is that of concern to the company?

“Mega might become one of the biggest customers of the content industry and all this ‘rogue’ nonsense will be forgotten,” Kim explains. “We want content creators to get paid!”

Easier said than done perhaps, but Kim says he has it all worked out. He told TorrentFreak the solution comes with Megakey, a product which provides Mega users with free premium services now, and free premium licensed music and movies in the future. All this will be financed through advertising and as usual, Kim has big, innovative and probably controversial plans in mind.

When Megakey is installed the software asks permission to modify where 10 to 15% of the user’s online advertising experience is sourced from.

“It works like an ad blocker but instead of blocking ads we show ads coming from Megaclick, our ad network,” says Kim. “This way we will generate enough ad revenue to provide free premium services and licensed content so that our users can have it for free.”

And the company believes the idea has huge potential.

“Imagine 450 million Megakey installations by 2015 with over 5 billion ad impressions per day. That pays for a lot of content,” Kim assured us. Looking at the graphic embedded below, traffic-wise the site is certainly a force to be reckoned with.

In future, free musical premium content will be provided through Megabox, described by Kim as the company’s iTunes competitor, while free premium movies will be supplied via Megamovie.com, a service we can reveal will be launched next year.

During the course of our discussion with Kim we also discovered an interesting feature that has been built into Megakey. Once installed the whole range of Mega sites can be accessed without the need to use the Internet’s DNS system, meaning that should SOPA kick in and the US government seizes Mega’s domains, users can still access the site.

“We implemented this to give users the fastest and most direct channel to our sites,” Kim told TorrentFreak. “Mega is not concerned about SOPA or Protect IP. We are a legitimate online service provider, online for 7 years.”

A lot has been said and written about Megaupload and Kim, including his earlier PR stunts. But this song, featuring artists on labels that are members of the RIAA, is on the next level.

Enjoy.
https://torrentfreak.com/riaa-label-...w-song-111209/





Universal Censors Megaupload Song, Gets Branded a “Rogue Label”
enigmax

Earlier today, Megaupload released a pop video featuring mainstream artists who endorse the cyberlocker service. News of the controversial Mega Song even trended on Twitter, but has now been removed from YouTube on copyright grounds by Universal Music. Kim Dotcom says that Megaupload owns everything in the video, and that the label has engaged in dirty tricks in an attempt to sabotage their successful viral campaign.

This morning we published an article on a new campaign by cyberlocker service Megaupload.

Site founder Kim Dotcom told TorrentFreak he had commissioned a song from producer Printz Board featuring huge recording artists including P Diddy, Will.i.am, Alicia Keys, Kanye West, Snoop Dogg, Chris Brown, The Game and Mary J Blige. These and others were shouting the praises of Megaupload.

By this afternoon #megaupload was trending on Twitter as news of the song spread. Little surprise interest was so high; Megaupload is described as a rogue site by the RIAA and here are some of their key labels’ artists promoting the service in the most powerful way possible – through a song.

And then, just a little while ago, the music stopped. Visitors to YouTube hoping to listen to the Mega Song were met with the following message.

TorrentFreak immediately contacted Kim to find out what was happening.

“Those UMG criminals. They are sending illegitimate takedown notices for content they don’t own,” he told us. “Dirty tricks in an effort to stop our massively successful viral campaign.”

So did Universal have any right at all to issue YouTube with a takedown notice? Uncleared samples, anything?

“Mega owns everything in this video. And we have signed agreements with every featured artist for this campaign,” Kim told TorrentFreak.

“UMG did something illegal and unfair by reporting Mega’s content to be infringing. They had no right to do that. We reserve our rights to take legal action. But we’d like to give them the opportunity to apologize.”

“UMG is such a rogue label,” Kim added, wholly appreciating the irony.

A few minutes after this exchange Kim contacted us with good news. After filing a YouTube copyright takedown dispute, the video was reinstated. But alas, just seconds later, it was taken down again.

“We filed a dispute, the video came back online and now it’s blocked again by UMG and the automated YouTube system has threatened to block our account for repeat infringement,” Kim explained.

TorrentFreak spoke with Corynne McSherry, Intellectual Property Director at EFF, who says this type of copyright abuse is nothing new.

“This appears to be yet another example of the kind of takedown abuse we’ve seen under existing law — and another reason why Congress should soundly reject the broad new powers contemplated in the Internet Blacklist Bills, aka SOPA/PIPA.

“If IP rightholders can’t be trusted to use the tools already at their disposal — and they can’t — we shouldn’t be giving them new ways to stifle online speech and creativity,” McSherry concludes.

Sherwin Siy, Deputy Legal Director at Public Knowledge, worries that this type of sweeping power would only be augmented with the arrival of the SOPA anti-piracy bill in the US.

“If UMG took down a video it has no rights to, then what we have here is exactly the sort of abuse that careless, overzealous, or malicious copyright holders can create by abusing a takedown law,” he told us.

“What makes this even worse is that UMG, among others, is pushing to expand its power to shut people down by fiat–SOPA lets rightsholders de-fund entire websites with the same sort of non-reviewed demand that removed this video,” he concludes.

Megaupload’s Kim Dotcom informs us that he has now submitted an international counter notification to YouTube, informing them that UMG has no rights to anything in the video and that the label abused the YouTube takedown system to sabotage the company’s business.

“It’s ridiculous how UMG is abusing their intervention powers in YouTube’s system to stop our legitimate campaign. They are willfully sabotaging this viral campaign. They own no rights to this content,” Kim insists.

“What UMG is doing is illegal. And those are the people who are calling Mega rogue? Insanity!”

Streisand Effect, here we come again.

Update: “The fact that this expression could be silenced by a major label — without any apparent infringement — should be seriously troubling to anyone who cares about artists’ speech rights,” says Casey Rae-Hunter, Deputy Director, Future of Music Coalition. “If this can happen to Snoop Dogg and others, it can happen to anyone.”
https://torrentfreak.com/universal-c...-label-111210/





I Don’t Pay for Music Anymore (Legally)
Chris Pirillo

I grew up with 45s and LPs, not having my first cassette tape until I was in the seventh grade (which was either Van Halen’s 5150 or Twisted Sister’s Stay Hungry). I didn’t have anything close to an “MP3″ — that would have been a dream come true. You could argue that the audio quality from a record is vastly superior to that of the average compressed audio file, but I don’t think that anybody would suggest that grooved discs are portable or capable of surviving an hour in the back seat of your car during summer. Every single delivery format has its benefits and drawbacks.

When I first heard of Napster, I didn’t quite get it. Here sat a veritable treasure trove of downloadable music — but it didn’t really cost anything to get. When I was in college, I had to scrimp and save and sell old cassette tapes to buy new CDs. I knew the value of an album, as dictated by storefronts, artists, and the industry. What once cost me $15 to attain simply couldn’t be free today. The value of a classic set of songs from the ’70s hadn’t shifted, right?

I’ve certainly spent a fair amount of money on music formats over the years.

I’d soon catch wind of nightmare-inducing digital music organizational issues: mistagged files, inconsistent bit rates, haphazard directory hierarchies. Whether attained from external sources or ripped locally, keeping those files in order just didn’t seem like a very productive use of time. Gaining access to them at any given moment wasn’t exactly easy to do back then, either. It’s difficult to imagine a day when we didn’t have near-ubiquitous wireless Internet access, isn’t it? Even if you had your digital music on a single player, you were still largely limited by capacity.

When the iTunes music store first launched, I didn’t think much about the idea. The convenience was there if you were starting from scratch and wanting to live in Apple’s world — but I wasn’t, and I didn’t. Why would I care to be tied to a certain set of computers and devices? It was still easier for me to walk across the room and pick up a physical item to spin. That wasn’t convenient, either. Nirvana, to me, would be a music subscription service that would allow me to listen to whatever music I wanted to listen to whenever I wanted to listen to it — pre-organized, accessible, and legal. Nevermind?

I was truly elated when Microsoft (in conjunction with MTV) announced Urge through the freshly-launched Windows Media Player store. Despite DRM integration, at least I didn’t have to jump over hurdles to get it to work with my various PCs or portable media player of choice (not an iPod). I could listen to pretty much every album I wanted to hear — point, click, play. Yeah, I was quite content to pay a reasonable monthly subscription fee for this service. It was like buying one new album every month and getting access to hundreds. I’m a huge music subscription service fan.

Urge melted into Rhapsody after Microsoft dropped the ball with its strategy (in the Zune timeframe), and my account migrated. I continued to pay the company — on top of paying a satellite radio provider for easy, quality, serendipitous content access away from home. Pandora slipped onto the scene, and… worked well enough on the desktop. I didn’t pay for a Pandora One account until it seemed I needed to do so in order to get the service to work with a dedicated Internet radio device.

When I started leasing my current vehicle, Bluetooth audio was finally a possibility — and, in conjunction with my iPhone, associated apps, and wireless 3G connection to the Internet, I was finally able to listen to darn near anything I wanted to listen to (darned near anywhere). It was good enough. So, why was I paying for satellite radio service if I already had something similar enough in my pocket? Earlier this year, I dumped XM — and it’s been begging me to come back ever since.

Then, I realized I didn’t need to pay for a Pandora account to gain access to its music library. Sure, I’d have to sit through a spoken ad or two, but that didn’t seem like too much of a trade-off. Lower audio quality? I don’t think my ears could ever hear the difference.

Then, Spotify launched. I had a three-month trial. Why was I paying Rhapsody, again? Exactly. It was a frictionless switch for me — given that I didn’t generate any reasonable number of playlists with my Rhapsody account. When my premium Spotify trial lapsed, I fell back onto the free service — which works much like Pandora does. From the desktop, I can listen to almost any album I care about (so long as I’m willing to put up with an advertisement or two). Hey, if that’s the company’s business model, and the music companies are playing in tune… who am I to argue?

I Don't Pay for Music Anymore (Legally)I still have a few MP3s somewhere on an NAS system at home, but I rarely ever look. I use either Spotify or Pandora from the desktop for free, or Pandora for free on the go. I’m not paying anything to listen to my favorite music tracks or genres anymore. I don’t need to, and I don’t feel guilty about it because parts of the industry are playing along. Is the experience a perfect one? No, but it never was for me. Do I still buy albums? Rarely. Will I go back to paying for access? Possibly.

You might wonder why I didn’t bother to bring up YouTube in all of this? Well, because it wasn’t always on the up-and-up. I like playing by the rules. It’s not just about doing what’s convenient — it’s about doing what’s right. You pay someone for their work if they’re asking to be paid in some capacity. I’m giving up my time in exchange for ad impressions, much like you’re giving up your attention to read this article that’s being supported by advertisers on our site.

I’m not paying for access to music that I’d like to hear today. It’s legal, it’s expedient, and it’s everywhere.
http://www.lockergnome.com/media/201...ymore-legally/





A Complete Guide To File Sharing Using Torrents
Rob Boirun

Trends come and go on the Internet, but some technologies claim a long-term place in the online world. In file sharing, one of those technologies is BitTorrent. Designed by programmer Bram Cohen in 2001, BitTorrent permanently changed the nature of online file sharing. While outdated networks like FastTrack and WinMX have faded away, BitTorrent has grown, cementing itself as the preferred file sharing system of millions.

Here’s how it works and how to get started:

What Torrents Are

Warning: The following information can be used for both good and evil. I’m going to assume that you will use this info based on files, videos, music that you have the correct access to. Not to be used for sharing copyrighted works.

The earliest file sharing network – Napster – operated on a centralized model. Person A downloads a song from Person B, but it’s all controlled and managed by a server at Napster headquarters. That server was the glue holding the whole network together. The next generation of software (programs like KaZaA and Morpheus) added a twist: not only did Person A download from Person B, they did so directly, with no assistance or monitoring from a central server that could be shut down by the courts. The users were the network.

BitTorrent operates basically the same way, but with another twist. Rather than downloading, say, an entire song from one person, you instead download pieces of that song from dozens of different people – all at the same time. This is called “swarming.” Once all the pieces are downloaded to your computer, they are assembled into the full song and you can play it just like normal.

Torrent Sites: Where Your Downloads Live

With older tools like Napster and KaZaA, you searched for whatever you wanted to download inside of those applications. Not with BitTorrent. Instead, you visit one of many “Torrent sites” (or trackers) and search for your software or song or video there. Think of these sites as file sharing search engines. You visit them and search for what you want to download: say, a recorded classroom lecture that a major university has decided to share with the Internet. When you find what you want, you click it and the download begins.

Key point, though: the search results you’ll get at these sites are NOT the downloads themselves. They’re .torrent files, which are basically data files containing information about the download: what it is, the file size, and, crucially, which BitTorrent users have pieces of that file for you to download. So the file would look like “HarvardLecture.torrent” rather than “HarvardLecture.avi” or the real file extension. Don’t be concerned about that, as these .torrent files are what tell your torrenting application (discussed below) where to download the real file from.

Burning Torrent Files to DVD

One of the more popular activities with torrent downloaders is to burn a video file torrent to a DVD. You don’t actually burn the .torrent file, instead you burn the movie that was included in the torrent file. For this you would need to use a Video to DVD converting software such as ConvertXtoDVD. This is a one step software where you load the downloaded movie and it will convert it into a DVD format and then burn to a blank DVD. You can then take the DVD to your DVD player (either on your PC, Mac, or standalone player) and watch it just like it was a store bought DVD. Of course the video you downloaded in the first place was not a bootlegged copy right? I’ll assume that it was a movie of the Holiday parade that someone recorded that you were not able to attend to. :)

Popular Torrenting Applications

In order to download .torrent files from torrent sites, you need a torrenting application on your computer. These applications process .torrent files and start downloading each piece of whatever you searched for. Again: you don’t search for things to download inside of these applications. You search on a torrent site (discussed above), click on what you want to download, and your torrent application actually downloads it.

uTorrent is free, works with Windows or Mac and is one of the most popular torrenting applications out there. It’s not the only one – there are literally hundreds to choose from. If an app other than uTorrent was recommended to you by a friend or seems appealing, go ahead and use it. Just know that a torrenting app of some kind is necessary to download stuff with torrenting.

Seeds & Leechers

When searching for things to download on torrent sites, you will notice two key numbers next to each file: seeds and leechers. Here’s what these terms mean, in plain English. A “seed” is someone who has the file in question (or part of it) on their computer and is offering it to the network for downloading. A “leecher” is someone who is downloading the file in question (or part of it.) There are also “peers”, or people who are both downloading and uploading the file at the same time.

Generally speaking, you want to download .torrent files with more seeds than leechers. More seeds means that uTorrent (or whichever torrenting app you use) has more places to download your file from. More leechers mean that lots of people are trying to download the same thing you are, at the same time you are. In other words, your download could be much slower because of them.

Avoiding Viruses

Unfortunately, viruses, spyware and other assorted worms are lurking on torrent sites and can infect you if you aren’t careful. The good news is that you can avoid 99% of these risks with common sense and a few rules:

Look at the file size. If a .torrent file claims to be a large software application (for example) but has a ridiculously small file size like 5MB, don’t download it. A hacker has simply dressed up a virus as something desirable so gullible people will download it.

Look at the number of seeds and leechers. Chances are, a virus or spyware program wont have tons of seeds and leechers. The unlucky people who got infected most likely removed it from their computer – they aren’t still offering it for download on BitTorrent under a false file name.

Follow the tech news. Outrageously nasty viruses are often publicized and talked about on tech sites like Wired.com. Be mindful of these sites and make sure you aren’t downloading known viruses on torrent sites.

Legal Issues

It’s been said often, but bears repeating: you are not legally allowed to share copyrighted material over the Internet. Software programs, music albums, mainstream movies – all of these things are protected by copyright law. Just because you can technically get away with downloading them doesn’t mean you aren’t breaking the law.

Those who do get caught face stiff penalties. Suspension of Internet service, fines and even jail time are all on the table when it comes to copyright infringement, so be careful.
http://www.business2community.com/te...orrents-098836





Copyright Trolls Auction Off €90 Million in File-Sharing Settlements
Ernesto

A German law firm has started an auction to sell the unpaid settlements of 70,000 alleged file-sharers to the highest bidder. The ‘debt’ belongs to people who thus far failed to settle with a copyright holder, and would be worth 90 million euros if recouped entirely. This controversial move opens up room for a new group of outfits to join the “pay-up-or-else” scheme – the aggressive debt collectors.

In recent months we’ve written dozens of articles on copyright trolls and their mass-lawsuits targeted at BitTorrent users.

The aim of these cases is to get suspected copyright infringers to settle for a few thousand dollars, in what we’ve dubbed a “pay-up-or-else” scheme. These settlement proposals are the core of every single case, and none of the copyright holders intends to proceed against the accused file-sharers in court.

Although we’ve mostly covered US and UK cases here at TorrentFreak, Germany is really the home turf of these practices. This year alone millions of people have been targeted for allegedly downloading and sharing copyrighted material in Germany, and all were asked to settle their debt with cash.

Unfortunately for the copyright holders, not all of the people targeted are willing to pay up immediately, not least because they haven’t shared the file in question.

To address this problem of unpaid settlements, German law firm Urmann has decided to find a creative way to get paid. Representing an adult entertainment company, they are selling the outstanding settlement demands of 70,000 accused file-sharers to the highest bidder. The ‘lucky’ buyer can then do whatever they think is needed to extract as much money as possible from those on their newly-purchased list.

The amount the 70,000 people are in ‘debt’ for is 1286.80 euros each, so the total in outstanding settlements up for auction amounts to €90 million ($120 million).

The target audience for this unusual purchase are debt collection agencies, who will undoubtedly introduce all sorts of harassing tactics and subtle threats to get as many people as possible to pay up. Needless to say, this turns these “pay-up-or-else” practices into an even darker scheme than they already are.

One of the companies currently going after BitTorrent users in Germany is CD Projekt, the makers of The Witcher 2: Assassins of Kings. Although there is no indication that they will go as far as selling their debt to collecting agencies, being involved in the settlement business doesn’t help their image.

It will be interesting to see whether the same debt collecting practices will also be tried in other countries such as the US.
http://torrentfreak.com/copyright-tr...ements-111208/





YouTube Buys Company That Processes Music Royalties
Ben Sisario

In an effort to streamline its often complex relations with music publishers, YouTube has acquired RightsFlow, an upstart company in New York that processes royalties for the music industry.

YouTube, which is owned by Google, is to announce the deal on a company blog on Friday afternoon. Terms of the purchase were not disclosed.

Through the deal, YouTube will gain a system for processing royalty payments to tens of thousands of publishers — the companies that represent songwriters — whenever music is included in a video that is played on the site. That procedure is often highly complicated because the music industry has no central database for finding publishers and songwriters; the Harry Fox Agency, the largest clearinghouse for this process, issues licenses on behalf of 46,000 publishers, but it does not represent thousands of others.

The revenue a songwriter or record company might earn from any one video is minuscule, but if that video becomes a big hit, the pennies of royalties through YouTube can add up to significant amounts of money. YouTube’s sheer size — it has more than 150 million videos — also means that a popular song could turn up in thousands of videos.

YouTube’s users are not likely to notice any difference on the service. But behind the scenes, RightsFlow, a four-year-old company with about 20 employees, will use its database to match songs to publishers and route royalty payments appropriately.

The company will also help YouTube in matching up compositions — the music and lyrics underlying every song — with recordings, whose copyrights are typically owned by record companies. However, RightsFlow will not handle the royalties for the recordings.

“It’ll be soup to nuts,” said David King, a group product manager at YouTube, of RightsFlow’s role. “Their mandate is to manage YouTube’s music-publishing needs.”

YouTube has had a rocky relationship with many music publishers over the years, but it has taken significant steps this year to improve relations with the publishers and smooth the payment of royalties.

Earlier this year, YouTube ended a four-year legal dispute with the National Music Publishers Association. Under their agreement, smaller publishers will be able to more easily collect a share of the advertising revenue generated by videos on the site. As part of that deal, the Harry Fox Agency, a subsidiary of the publishers’ association, created its own system to let publishers preclear their songs for YouTube use and process royalty payments for that song.

Mr. King said that YouTube’s agreement involving Harry Fox still stood. But it was unclear how the RightsFlow deal would affect it.

Patrick Sullivan, the chief executive of RightsFlow, said YouTube’s purchase would allow royalties for the music on YouTube videos to be paid out more efficiently, resulting in money flowing to the hands of songwriters more quickly.

“When creators put user-generated content into YouTube,” Mr. Sullivan said, “this will allow that content to get monetized properly, so that the creator gets paid, and the songwriter and publisher gets accounted to and paid.”
http://mediadecoder.blogs.nytimes.co...sic-royalties/





Walmart Launches Shopycat Application
Sarah Harris

If you’re one of the millions of people that use Facebook, you may be aware that the social networking site is notorious for caching customer information (your likes, dislikes, purchases, friends, and so on). Plus, thanks to their changes in privacy policy over the last couple of years, they are now selling that information to third parties that would like to find better ways to market to you (in order to convince you to buy their products). Of course, thanks to a recent agreement with the Federal Trade Commission, you’ll soon have the ability to opt out by bumping up your privacy settings, but it seems that Walmart squeaked in under the wire with their Shopycat app.

Alright, so it’s not exactly Big Brother, and some shoppers may even appreciate the fact that they are receiving content that is more relevant to them personally (rather than being bombarded by ads for penis enhancing drugs, for example). But the truth of the matter is that the app functions by tracking the movements of you and the people on your Facebook friend list, which everyone can probably agree is a little unsettling. So what exactly does this app do and how is Walmart using it to make your shopping experience better?

The Shopycat app, the first from Walmart’s newly developed @WalmartLabs division (which aims to take the business into the social networking and e-commerce spheres) is a simple idea with a complex inception. Walmart wants to help you find gifts for your friends (ideally by shopping in their stores). So they utilize software (developed by recently acquired Kosmix) that collects information about the people on your friend list and compiles it into usable data that can be filtered, sorted, and matched up to Walmart products. Then you are given a list of gifts that would likely be suitable for the people you are connected to on Facebook. In short, it’s going straight to the source and finding out what to recommend.

And Walmart isn’t the only one taking this approach to streamlining the user experience based on information gathered via social networking. EBay is also looking to beef up sales by figuring out what users like. They recently acquired Hunch, a platform that tracks purchases in order to make predictions about what customers might like and then “customize” their experience by recommending current listings on eBay. And have you noticed that ads popping up in your browser reflect your recent online activity? It’s not just the government watching, as George Orwell predicted in his sci-fi thriller 1984; EVERYONE is watching you.

So if you browse new car listings, for example, you might start seeing ads for auto insurance. Or if you peruse shoes on Nextag you could be bombarded with discount shoe ads. And if you preload a Mango MasterCard for someone, suddenly you’ll find yourself inundated by reload card advertising. Although Walmart is taking a slightly different tack by targeting your friends, the goal is the same; to make you buy. And this isn’t the end by a long shot.
http://www.business2community.com/mo...ication-099733





Exclusive: Verizon to Take On Netflix with Web Service
Yinka Adegoke and Sinead Carew

Verizon Communications Inc plans to launch a standalone service allowing customers to stream movies and television shows over the Web, in a fresh challenge to Netflix Inc and the traditional cable TV business, according to several people briefed on the plan.

The phone company is talking with prospective programming partners about the service, which would be introduced outside of markets where it currently offers its broadband and TV package, known as FiOS, these people said. That would make it available to some 85 million U.S. households.

The new service could be rolled out in 2012, according to one of the people.

Shares in Netflix fell by as much as 5 percent on Tuesday to the day's low before recovering to end the day down 3 percent at $68.14 on the Nasdaq.

The package of programming would be limited in its scope, said two people with knowledge of the plans. Another person said the focus would be packages of movies similar to Liberty Media's Starz Play and Viacom's Epix or could involve children's programming from a partner such as Walt Disney Co or Viacom.

Epix's current exclusive online-streaming contract with Netflix runs out next September, allowing other services to negotiate with Viacom for Epix' package of movies from Paramount, Lions Gate and MGM studios.

Viacom Chief Executive Phillipe Dauman said at a conference this week his company would be open to negotiating with other broadband only services.

People familiar with the plans declined to be identified as the discussions between Verizon and programming partners are confidential and sensitive.

Verizon has been back and forth with programmers over the last two years exploring the possibility. While a lot of the discussion has been around fees, the programmers have also been concerned about the possibility of hurting their existing - and lucrative - relationships with the cable operators.

Crucially, any new Web TV service would be offered outside of Verizon's FiOS current markets. Verizon currently has 5 million FiOS TV subscribers.

A Verizon spokesman declined to comment.

News of the service will have added controversy in the wake of sister company Verizon Wireless's plans to resell cable TV service for Comcast Corp, Time Warner Cable Inc and Bright House Networks.

Under that deal, announced last week, Verizon Wireless will pay $3.6 billion for valuable spectrum from the cable companies. Verizon Wireless is a joint venture of Verizon and Vodafone Group.

While a limited package of TV shows and movies is unlikely to have an immediate impact on cable sales, the launch of an online video service by a major company like Verizon will only add to the uneasiness in the pay TV business.

Companies that sell cable and satellite subscriptions are concerned that customers will drop their pay-TV subscriptions in favor of cheaper Web alternatives - so called 'cord-cutting' or 'over-the-top'.

Most likely, Verizon would want to price any such service competitively with Netflix, whose subscriber count has swelled to some 23 million.

In the last few years, traditional cable operators have been steadily losing video customers to satellite and phone companies who have replicated the cable model. But the biggest fear is that new Web rivals including Netflix, Amazon.com Inc and Google Inc will disrupt the $100 billion a year cable business.

Microsoft Corp had looked closely at launching a similar disruptive service through its Xbox gaming device but has so far decided to work with the cable industry in offering an enhanced service to paying cable and satellite subscribers.

"If this deal comes true it's not clear to me what Verizon would bring to the table that is materially different to what others like Amazon offer," said Carlos Kirjner, analyst at Bernstein Research. Kirjner said Verizon would struggle to negotiate favorable terms to be competitive with Netflix.

Netflix CEO Reed Hastings, speaking about rivals at a UBS Media and Technology investment conference on Tuesday, said "the competitor we fear most is HBO Go," a streaming service for subscribers of the pay TV channel owned by Time Warner Inc.

"HBO and Netflix both spend between $1 billion and $2 billion a year on content. If you want to compete with HBO and Netflix, you better commit to multiple-year spending between one and two billion," Hastings said.

"At this point, none of these guys have chosen to do that," Hastings said. He was not asked specifically about the planned Verizon service.

One reason Verizon is keen on launching online services is to be able to grow its customer base and thereby lower its programming costs on a per-subscriber basis. The more subscribers a distributor has, the easier it is to negotiate lower fees.

Programmers and distributors have been working closely together for the last year on making cable networks available on the Web to paying subscribers in an initiative called TV Everywhere.

Verizon FiOS customers currently have access to around 30 networks over the Web through FiOS TV Online.

(Reporting by Yinka Adegoke; Additional reporting by Lisa Richwine in Los Angeles; editing by Paul Thomasch, Bernard Orr, Gary Hill)
http://www.reuters.com/article/2011/...7B527L20111206





Xbox Live Challenges Cable Box
Nick Wingfield and Brian Stelter

The old-fashioned cable television set-top box — long the hub of living-room entertainment for most people — is about to become less relevant.

Beginning on Tuesday and continuing through the month, Microsoft will give a face-lift to its Xbox Live online entertainment service that will allow subscribers to watch a wide array of mainstream television programming from the Xbox 360 console.

In addition, rather than fumbling with traditional remote controls and the primitive program guides of cable boxes, Xbox Live users will be able to search for shows using voice commands and hand gestures, if they also have the popular Kinect peripheral for the Xbox.

Later this month, Microsoft will begin adding dozens of other sources of programming to the service, including Verizon FiOS, Comcast’s Xfinity and HBO. On Tuesday, the few online video services that have been on Xbox Live for some time, including Netflix and Hulu Plus, will be able to be retrieved using voice searching and other methods.

Microsoft’s deal with cable and content providers stops short of making it possible for people to ditch their traditional pay-television packages; people will still need to pay the cable providers to get channels through the Xbox. They will also have to pay the roughly $60 a year Microsoft typically charges for a premier membership to Xbox Live.

And the Xbox won’t be a true substitute for everything viewers can get through their cable boxes because content rights will have to be negotiated for some shows before they can be watched through the console.

But the agreement is nonetheless significant because there are more than 35 million worldwide subscribers to Xbox Live, making the Xbox one of the most common Internet-connected boxes in living rooms. And it is part of a growing effort by media companies to bring some 21st-century pizazz to the experience of navigating and watching television, a medium that is largely watched using traditional remote controls and set-top boxes that have changed little in the past 10 years.

Most cable boxes require viewers to navigate through primitive on-screen program guides, pressing buttons on their remotes to scroll through the vast lists of shows. The process is especially jarring for a generation of people who are accustomed to the slick graphics and responsiveness of more modern devices, like the Xbox and the iPad.

“The user experience through traditional cable set-top boxes hasn’t kept pace with the kind of user experience people get from all these other devices they use throughout the day,” Tom Rogers, chief executive of TiVo, said.

With the update coming this week to the Xbox, all of the video available to users over the Xbox Live service from all of Microsoft’s media partners will be indexed, so people can search for programs using their voices and the company’s Bing search engine, instead of awkwardly tapping out search terms through remote controls pointed at cable set-top boxes.

In a demonstration of the technology last week at Microsoft’s headquarters in Redmond, Wash., Michael Suraci, director of marketing for Xbox Live, told an Xbox to “Bing Sandra Bullock,” which promptly found “The Blind Side,” “Crash” and several other movies starring the actress that were available through various sources of video on Xbox Live.

Mr. Suraci also used a sequence of voice commands to switch to an app for Verizon’s FiOS TV, within which he could flip among live channels by using more voice commands or a swiping motion with his hands.

“I think it’s a much, much better experience to use voice than typing,” said Marc Whitten, corporate vice president of Xbox Live.

Mark Greenberg, chief executive of Epix, a company that streams films from Paramount, Lionsgate and MGM, raved about the voice search and hand-gesture capabilities of the Xbox. Epix will stream a library of about 3,000 films through the Xbox.

“Maybe it’s the beginning part of the process toward eliminating the set-top box,” Mr. Greenberg said, while adding that he did not expect the traditional box to go away completely.

Cable executives have conflicting attitudes about the set-top boxes. Many acknowledge that they seem outdated compared with other forms of consumer electronics, and realize that consumers have trouble using them, especially as more video becomes available. “It can be frustrating to consumers to be entitled to content and have difficulty finding it,” said Samuel M. Schwartz, an executive vice president of Comcast who oversees emerging Internet businesses.

The Xbox, Mr. Greenberg said, “is an opportunity for the cable industry to experiment.”

Executives would also love to get rid of the cost of buying and deploying the devices, even though their customers typically pay an extra monthly fee to lease the boxes. Among the most vocal about getting out of the set-top-box business is Glenn Britt, the chief executive of Time Warner Cable, the country’s second-biggest cable company.

“We’d rather not be in the set-top box business, believe me,” Mr. Britt said in an interview this year, calling the boxes cumbersome. “A world without them is a much better consumer experience.”

And yet the devices are an important link in the relationship between cable companies and their customers. That link could begin to weaken though, if the Xbox overshadows FiOS and Comcast as a source of videos. Microsoft, Apple and other online distributors of video could try to start to sell bundles of channels over the Internet, disrupting the traditional cable company model

This fall, channel owners like NBC Universal and Discovery Communications have held talks with would-be Internet distributors like Dish Network and Sony about so-called over-the-top bundles that could allow people to buy packages of shows over high-speed Internet connections. It is unclear how far the talks have progressed, and none of the companies have acknowledged the talks on the record.

For now, the TV apps on the Xbox are not functional enough to fully replace set-top boxes. In the upgrade, which was announced in October, Comcast will offer only on-demand videos, not live channels. The FiOS TV app on the Xbox will have only 26 channels at the outset, a fraction of the hundreds that are available through a set-top box.

That is because “content rights are explicit,” said Joseph Ambeault, a director of product management at Verizon. If an existing contract with channels “doesn’t say you can put the content on an Xbox, you have to go and secure those additional rights.”

The Xbox is just one of many devices, including iPads and smartphones, on which cable operators and channels are making their content accessible. TiVo, for one, has announced a string of partnerships with cable operators to make its digital video recorder available to their customers. Unlike the Xbox, TiVo users get full access to all of the offerings of TiVo’s cable partners, Mr. Rogers, TiVo’s chief executive, said.

He added that consumers were hungry for an easier way to find programs.

“The television is the biggest screen in the house, the most-watched screen,” he said.
https://www.nytimes.com/2011/12/05/t...cable-box.html





TV Isn't Broken, So Why Fix It?
Matt Rosoff

The technology industry is absolutely bent on reinventing television.

According to Walter Isaacson's biography of Steve Jobs, one of his last big accomplishments was figuring out how to make a better TV.

"I'd like to create an integrated television set that is completely easy to use," Jobs told his biographer. "It would be seamlessly synced with all of your devices and with iCloud....It will have the simplest user interface you could imagine. I finally cracked it."

Since then, the world has gone crazy speculating about how great this iTV (or whatever it's called) will be. It will apparently be powered by Siri, Apple's voice controlled assistant that appeared in the iPhone 4S earlier this year. Analyst Gene Munster thinks it will come in several sizes, be controllable from your iPhone or iPad, and -- this is Apple after all -- cost twice the price of a normal TV.

Apple isn't alone.

Google just released the second version of its Internet-meets-TV software, Google TV. This is despite the fact that first version was such a flop that hardware partner Logitech had more Google TV returns than sales in the first quarter of 2011. (Not surprisingly, Logitech is not going to be on board for round two.)

Microsoft is also getting into the act again, after countless failed attempts stretching back almost two decades. (Remember WebTV?) This time, it's teamed up with TV providers like Comcast and Verizon FiOS to deliver shows to the Xbox 360 game console. The big benefit: users will be able to search for shows by giving voice commands to Kinect, the nifty Xbox add-on that recognizes voice and gestures.

Smaller companies like Roku and Boxee are also in the game.

But nobody seems to be able to answer the big question: what exactly is so broken about TV anyway?

It's true that the TV guide in most cable systems is pretty awful -- it looks like Yahoo circa 1994. It's a pain fiddling with a bunch of different remotes. It might be kind of nice to watch YouTube videos on a big screen in the living room.

But I'm going to go out on a limb here and say that most TV viewers simply won't care enough about any of this stuff to shell out $1,500 for a new Apple TV, or spend a few hundred bucks and countless hours fiddling around adding a new box to their TV set and figuring out how it works.

All of these are destined to be niche products at best -- just like every other attempt to improve TV over the last 20 years.

Here's why.

The tech industry is filled with engineers and geeks. They naturally want to optimize the TV experience, to make it as efficient and elegant as possible, requiring the fewest number of steps to complete a particular task while offering the greatest number of amazing new features.

But normal people don't think about TV that way. TV is passive. The last thing we want to do is work at it.

And right now, we're not working that hard. It's not that tough to keep track of a few favorite shows -- Breaking Bad is on Monday, NFL games happen on Sunday, SportsCenter is every night at 11, and CNN is on channel 56 if something big is happening in the Middle East or Washington. You turn the set on, turn to the right channel, and that's it. Done.

The rest of the time, we're not all that picky. As long as there's something on -- anything -- that is reasonably engaging, we're cool. Most of us are even OK spending a few minutes just shuffling through channels at random. (Remember -- "channel surfing" was used to describe this habit long before "Web surfing" came around.)

Over the years, Steve Jobs himself identified a lot of the reasons why it's hard to change the TV industry. Cable companies give set top boxes away, which makes it hard for anybody else to break in. The cable industry is "balkanized," which makes it hard to pick a single partner like Apple did with AT&T and the iPhone.

But the real clue comes, again, from the Isaacson biography. Jobs talks about having a really tough time balancing his return to Apple in 1997 with his obligations as CEO of Pixar. "I would go to work at 7 a.m. and get back at 9 at night and the kids would be in bed. And I couldn't speak, I literally couldn't, I was so exhausted....All I could do was watch a half hour of TV and vegetate."

That's why we love TV just the way it is. If it ain't broke, don't fix it.
http://edition.cnn.com/2011/12/02/te...ing/index.html





The New Digital Divide
Susan P. Crawford

FOR the second year in a row, the Monday after Thanksgiving — so-called Cyber Monday, when online retailers offer discounts to lure holiday shoppers — was the biggest sales day of the year, totaling some $1.25 billion and overwhelming the sales figures racked up by brick-and-mortar stores three days before, on Black Friday, the former perennial record-holder.

Such numbers may seem proof that America is, indeed, online. But they mask an emerging division, one that has worrisome implications for our economy and society. Increasingly, we are a country in which only the urban and suburban well-off have truly high-speed Internet access, while the rest — the poor and the working class — either cannot afford access or use restricted wireless access as their only connection to the Internet. As our jobs, entertainment, politics and even health care move online, millions are at risk of being left behind.

Telecommunications, which in theory should bind us together, has often divided us in practice. Until the late 20th century, the divide split those with phone access and those without it. Then it was the Web: in 1995 the Commerce Department published its first look at the “digital divide,” finding stark racial, economic and geographic gaps between those who could get online and those who could not.

“While a standard telephone line can be an individual’s pathway to the riches of the Information Age,” the report said, “a personal computer and modem are rapidly becoming the keys to the vault.” If you were white, middle-class and urban, the Internet was opening untold doors of information and opportunity. If you were poor, rural or a member of a minority group, you were fast being left behind.

Over the last decade, cheap Web access over phone lines brought millions to the Internet. But in recent years the emergence of services like video-on-demand, online medicine and Internet classrooms have redefined the state of the art: they require reliable, truly high-speed connections, the kind available almost exclusively from the nation’s small number of very powerful cable companies. Such access means expensive contracts, which many Americans simply cannot afford.

While we still talk about “the” Internet, we increasingly have two separate access marketplaces: high-speed wired and second-class wireless. High-speed access is a superhighway for those who can afford it, while racial minorities and poorer and rural Americans must make do with a bike path.

Just over 200 million Americans have high-speed, wired Internet access at home, and almost two-thirds of them get it through their local cable company. The connections are truly high-speed: based on a technological standard called Docsis 2.0 or 3.0, they can reach up to 105 megabits per second, fast enough to download a music album in three seconds.

These customers are the targets for the next generation of Internet services, technology that will greatly enhance their careers, education and quality of life. Within a decade, patients at home will be able to speak with their doctors online and thus get access to lower-cost, higher-quality care. High-speed connections will also allow for distance education through real-time videoconferencing; already, thousands of high school students are earning diplomas via virtual classrooms.

Households will soon be able to monitor their energy use via smart-grid technology to keep costs and carbon dioxide emissions down. Even the way that wired America works will change: many job applications are already possible only online; soon, job interviews will be held by way of videoconference, saving cost and time.

But the rest of America will most likely be left out of all this. Millions are still offline completely, while others can afford only connections over their phone lines or via wireless smartphones. They can thus expect even lower-quality health services, career opportunities, education and entertainment options than they already receive. True, Americans of all stripes are adopting smartphones at breakneck speeds; in just over four years the number has jumped from about 10 percent to about 35 percent; among Hispanics and African-Americans, it’s roughly 44 percent. Most of the time, smartphone owners also have wired access at home: the Pew Internet and American Life Project recently reported that 59 percent of American adults with incomes above $75,000 had a smartphone, and a 2010 study by the Federal Communications Commission found that more than 90 percent of people at that income level had wired high-speed Internet access at home.

But that is not true for lower-income and minority Americans. According to numbers released last month by the Department of Commerce, a mere 4 out of every 10 households with annual household incomes below $25,000 in 2010 reported having wired Internet access at home, compared with the vast majority — 93 percent — of households with incomes exceeding $100,000. Only slightly more than half of all African-American and Hispanic households (55 percent and 57 percent, respectively) have wired Internet access at home, compared with 72 percent of whites.

These numbers are likely to grow even starker as the 30 percent of Americans without any kind of Internet access come online. When they do, particularly if the next several years deliver subpar growth in personal income, they will probably go for the only option that is at all within their reach: wireless smartphones. A wired high-speed Internet plan might cost $100 a month; a smartphone plan might cost half that, often with a free or heavily discounted phone thrown in.

The problem is that smartphone access is not a substitute for wired. The vast majority of jobs require online applications, but it is hard to type up a résumé on a hand-held device; it is hard to get a college degree from a remote location using wireless. Few people would start a business using only a wireless connection.

It is not just inconvenient — many of these activities are physically impossible via a wireless connection. By their nature, the airwaves suffer from severe capacity limitations: the same five gigabytes of data that might take nine minutes to download over a high-speed cable connection would take an hour and 15 minutes to travel over a wireless connection.

Even if a smartphone had the technical potential to compete with wired, users would still be hampered by the monthly data caps put in place by AT&T and Verizon, by far the largest wireless carriers in America. For example, well before finishing the download of a single two-hour, high-definition movie from iTunes over a 4G wireless network, a typical subscriber would hit his or her monthly cap and start incurring $10 per gigabyte in overage charges. If you think this is a frivolous concern, for “movie” insert an equally large data stream, like “business meeting.”

Public libraries are taking up the slack and buckling under the strain. Nearly half of librarians say that their connections are insufficient to meet patrons’ needs. And it is hard to imagine conducting a job interview in a library.

IN the past, the cost of new technologies has dropped over time, and eventually many Americans could afford a computer and a modem to access a standard phone line. Phone service — something 96 percent of Americans have — was sold at regulated rates and the phone companies were forced to allow competing Internet access providers to share their lines.

But there is reason to believe this time is different. Today, the problem is about affording unregulated high-speed Internet service — provided, in the case of cable, by a few for-profit companies with very little local competition and almost no check on their prices. They have to bear all the cost of infrastructure and so have no incentive to expand into rural areas, where potential customers are relatively few and far between. (The Federal Communications Commission recently announced a plan to convert subsidies that once supported basic rural telephone services into subsidies for basic Internet access.)

The bigger problem is the lack of competition in cable markets. Though there are several large cable companies nationwide, each dominates its own fragmented kingdom of local markets: Comcast is the only game in Philadelphia, while Time Warner dominates Cleveland. That is partly because it is so expensive to lay down the physical cables, and companies, having paid for those networks, guard them jealously, clustering their operations and spending tens of millions of dollars to lobby against laws that might oblige them to share their infrastructure.

Cable’s only real competition comes from Verizon’s FiOS fiber-optic service, which can provide speeds up to 150 megabits per second. But FiOS is available to only about 10 percent of households. AT&T’s U-verse, which has about 4 percent of the market, cannot provide comparable speeds because, while it uses fiber-optic cable to reach neighborhoods, the signal switches to slower copper lines to connect to houses. And don’t even think about DSL, which carries just a fraction of the data needed to handle the services that cable users take for granted.

Lacking competition from other cable companies or alternate delivery technologies, each of the country’s large cable distributors has the ability to raise prices in its region for high-speed Internet services. Those who can still afford it are paying higher and higher rates for the same quality of service, while those who cannot are turning to wireless.

IT doesn’t have to be this way, as a growing number of countries demonstrate. The Organization for Economic Cooperation and Development ranks America 12th among developed nations for wired Internet access, and it is safe to assume that high prices have played a role in lowering our standing. So America, the country that invented the Internet and still leads the world in telecommunications innovation, is lagging far behind in actual use of that technology.

The answer to this puzzle is regulatory policy. Over the last 10 years, we have deregulated high-speed Internet access in the hope that competition among providers would protect consumers. The result? We now have neither a functioning competitive market for high-speed wired Internet access nor government oversight.

By contrast, governments that have intervened in high-speed Internet markets have seen higher numbers of people adopting the technology, doing so earlier and at lower subscription charges. Many of these countries have required telecommunications providers to sell access to parts of their networks to competitors at regulated rates, so that competition can lower prices.

Meanwhile, they are working toward, or already have, fiber-optic networks that will be inexpensive, standardized, ubiquitous and equally fast for uploading and downloading. Many of those countries, not only advanced ones like Sweden and Japan but also less-developed ones like Portugal and Russia, are already well on their way to wholly replacing their standard telephone connections with state-of-the-art fiber-optic connections that will even further reduce the cost to users, while significantly improving access speeds.

The only thing close is FiOS. But, according to Diffraction Analysis, a research firm, it costs six times as much as comparable service in Hong Kong, five times as much as in Paris and two and a half times as much as in Amsterdam. When it comes to the retail cost of fiber access in America, we do about as well as Istanbul.

The new digital divide raises important questions about social equity in an information-driven world. But it is also a matter of protecting our economic future. Thirty years from now, African-Americans and Latinos, who are at the greatest risk of being left behind in the Internet revolution, will be more than half of our work force. If we want to be competitive in the global economy, we need to make sure every American has truly high-speed wired access to the Internet for a reasonable cost.

Susan P. Crawford is a professor at the Benjamin N. Cardozo School of Law and a former special assistant to President Obama for science, technology and innovation policy.
https://www.nytimes.com/2011/12/04/o...ew-divide.html





How AT&T Fumbled its $39 Billion Bid to Acquire T-Mobile
Cecilia Kang and Jia Lynn Yang,

The phone call hit like a one-two punch.

Days before Thanksgiving, AT&T's heavyweight lobbying team was busy setting up meetings with antitrust authorities scrutinizing the company’s $39 billion acquisition of T-Mobile.

Julius Genachowski, chairman of the Federal Communications Commission, was on the line for AT&T’s chief executive, Randall Stephenson, and its chief of lobbying, James Cicconi. In a few hours, Genachowski said, he would announce his opposition to the deal. AT&T was stunned.

In a city overrun with lobbyists and corporate interests, AT&T is king of the heap — the bareknuckled brawler that spares no energy or expense to win any fight. Since 1998, the company has given more money in campaign contributions than any other firm in corporate America. It’s also one of the top 10 corporate spenders on lobbying, according to the Center for Responsive Politics.

And it gets results. In the past 15 years, AT&T has successfully acquired a dozen firms and regularly wins its regulatory battles on Capitol Hill and at the FCC.

With that record, the company was confident it could push through the T-Mobile deal. AT&T, which has been hit with complaints from customers about dropped calls, wanted to improve its broadband coverage to compete with rival behemoth Verizon. This deal, At&T argued, would allow it to do that. Plus, the climate in Washington seemed right. Months before, officials had okayed another blockbuster deal, the $30 billion joint venture between Comcast and NBC. And surely the administration would be on board, AT&T reasoned. In his state of the union speech, President Obama had deemed expanding broadband access a national priority.

With the company’s biggest bet in years on the line, AT&T’s government operatives, led by Cicconi, a former staffer for George H.W. Bush, relied on the political playbook that has worked for the company countless times. It hired seven former congressional lawmakers to help lobby for the deal. Besides pouring tens of millions into political advertising, the firm had the support of lawmakers whose campaigns it had funded and third-party groups it supports financially, from the NAACP to the Louisiana Ballooning Foundation.

And in its estimated $40 million ad campaign and discussions with government officials, AT&T latched onto an argument it was sure would win over Washington — jobs — saying the merger would put thousands of Americans to work.

So how did one of Washington’s most feared lobbying operations wind up in a losing battle with regulators?

The old playbook backfired, according to dozens of interviews with government officials, lobbyists and consumer groups.

The letters from third-party groups raised eyebrows at government agencies and on the Hill, where people began wondering why groups with no obvious ties to broadband were writing in. News reports emerged showing that many of the groups had financial ties to AT&T.

Then there were the ads that staff members at the FCC said they couldn’t avoid when they opened a newspaper, fired up their iPads or watched TV — all touting the merger’s ability to put thousands of Americans to work. But who had ever heard of a big company merger creating rather than destroying jobs?

And the Obama administration was pivoting to a new theme that would echo a feeling, embodied by the Occupy Wall Street movement, that corporate power has run amok in this country. On Tuesday, in a speech in Osawatomie, Kan., Obama invoked the legacy of Teddy Roosevelt, the first president to leverage the country’s antitrust laws to bust up monopolies.

Ultimately, the closer antitrust officials looked at the facts of the case, the more it troubled them that two carriers — AT&T and Verizon — could potentially own 80 percent of the country’s wireless market.

In August, the Justice Department sued to block the merger. And last week, there was another blow when the FCC released a damning report concluding that the deal would not only hurt competition, but also destroy jobs. The agency’s move to block the merger has made the deal close to impossible, some experts say.

“This has been some of the worst couple weeks of my life,” said Cicconi, whose team now has the job of salvaging the deal in a tougher political atmosphere — in this moment of the Occupiers, when mistrust about Wall Street and big business is running high. What began as an exercise of old-school lobbying muscle might become a lesson in corporate overreach.

A lobbying army

When the companies announced their intentions in March, the size of the blockbuster deal raised immediate questions. But policy experts and Wall Street analysts said that if anyone could succeed, it would be AT&T, one of the most politically powerful companies in the country.

“We are confident AT&T would have worked through both the political calculus and the hard numbers,” wrote former Stifel Nicolaus analyst Rebecca Arbogast in a March research note. “AT&T has a sterling record of getting deals approved by the government.”

From 1998 to 2010, the firm handed out more than $45 million to Democratic and Republican candidates, more than any other company in America. During that period, AT&T also shelled out more than $130 million for lobbying.

With the biggest merger in years at stake, AT&T’s lobbying machine kicked into gear.

The company brought on 18 outside firms to assist in the all-out effort, enlisting the help of former U.S. senators John Breaux (D-La.) and Trent Lott (R-Miss.). Since the merger was unveiled, the company has spent more than $9 million on lobbying, according to public records.

It was a smooth, highly synchronized campaign. In every ad, letter and meeting with lawmakers and regulators, the company hammered home three reasons the merger should be approved: It would create jobs, bring the Internet to isolated and neglected areas of the country and help Americans get online and compete better with countries that are leaping ahead in high-tech innovations, according to Capitol Hill staff and government officials.

“AT&T looked at this administration that was viewed as weak on regulation early on, and I think they were willing to test if it would live up to that reputation,” said Harold Feld, legal director at the consumer advocacy group Public Knowledge.

At first, few critics emerged, except for competitor Sprint Nextel and consumer advocacy groups. The Communication Workers of America signed on as one of the merger’s most powerful allies. AT&T won the support of 117 lawmakers, who signed a letter urging regulators to approve the deal. All but one had received campaign contributions from AT&T employees, according to the Center for Responsive Politics.

Cracks in the case

But as the reviews at Justice and the FCC got underway, arguments against the deal were beginning to sway other lawmakers on the Hill and, more important, the regulators.

After a Judiciary Committee hearing in May, in which AT&T chief Stephenson testified, Sen. Herb Kohl (D-Wis.) sent a strongly worded letter to regulators urging them to oppose the deal.

“I have concluded that this acquisition, if permitted to proceed, would likely cause substantial harm to competition and consumers, would be contrary to antitrust law and not in the public interest, and therefore should be blocked by your agencies,” he wrote.

Meanwhile, some of AT&T’s aggressive tactics were not having their desired effect.

Hundreds of letters were pouring in to lawmakers’ and regulators’ offices from public-interest groups that seemed unrelated to the deal.

The Virginia Asian Chamber of Commerce, which counts AT&T as a sponsor, told the FCC to approve the deal quickly, arguing that as a group “striving to create bridges between cultures, we look forward to the foundation that this merger will create and the opportunities that it will give the public.” The FCC also received letters from a homeless shelter called the Shreveport-Bossier Rescue Mission, the National Urban League and many other groups that had received financial support from AT&T.

It was all ringing a little false to lawmakers and regulators, who took the mailings as a sign that AT&T could not support the merger on legal grounds alone.

AT&T’s blitzkrieg of ads, which claimed that the promised expansion of broadband would create 100,000 jobs, wasn’t helping either.

A deal’s impact on jobs is not typically part of an evaluation by antitrust officials, but this time regulators thought AT&T’s campaign had forced them to take a closer look. They found holes. For one, the company refused to divulge how many jobs it would eliminate in the merger.

At the news conference announcing the Justice Department’s suit to block the deal, Deputy Attorney General James M. Cole said doing so would “protect jobs in the economy.”

Incredulous staff members at the FCC also sent a harshly worded letter in the fall saying the company had “produced almost nothing” to prove its job claims. Their skepticism grew when an AT&T lawyer accidently uploaded internal documents to the agency’s Web site that showed the company was planning to expand its broadband network even if the merger didn’t go through.

And on the key question of whether the deal would harm competition, AT&T was unable to sway both agencies. They concluded that the merger would create a troubling near-duopoly, with AT&T and Verizon controlling nearly 80 percent of all cellphone contracts.

If the proposal weren’t so clearly anticompetitive, according to legal experts, the work of AT&T’s powerful government operators could have helped smooth out any rough edges for regulators willing to work out a compromise.

Staffers at both agencies, who coordinated closely on their reviews, said concessions in the form of divestitures and conditions couldn’t solve the problem that the merger would control too much of the market.

“Antitrust law is not about lobbying,” said Reed Hundt, who served as FCC chairman during the Clinton administration. “Maybe they wanted to push the edge of antitrust law, but I’ve never seen a merger get through just on lobbying.”

Forging ahead

The rejections from the government caught the corporate giant off guard.

Three months before the FCC delivered its blow, the company was equally unprepared when Justice blocked the deal. The morning of the announcement, Stephenson told CNBC anchors that he was confident regulators would agree the deal was good for the economy.
In characteristic style, AT&T remains uncowed. It’s getting ready for its showdown in court against the Justice Department. And in response to the FCC’s report on the merger, AT&T sent a scathing letter calling the document “an advocacy piece, and not a considered analysis.”

Asked later whether the company was biting the hand of the regulatory agency that will decide on future business deals, Cicconi said: “We had to do it,” he said. “Their report was harshly worded, too.”

While the battle is not over, AT&T is paying a heavy cost for the government’s disapproval. Last month the company took a $4 billion write-down to cover the breakup fee it must pay to Deutsche Telekom, T-Mobile’s parent, if the deal is not completed by September. Even so, in their view, the merger isn’t dead.

“We have lived in fear of them for so long,” said Maura Corbett, president of the Glen Echo Group, which helped organize a coalition of groups opposing the deal. “But there is a point where you jump the shark. There is a point where you overplay your hand.”
http://www.washingtonpost.com/busine...6hO_story.html





Kodak's Long Fade to Black
Michael Hiltzik

Like the passing of distinguished individuals, the passing of great corporations should prompt us to ponder the transience of earthly glory.

So let's pay our respects to Eastman Kodak, which at this writing appears to be a shutter-click from extinction.

Once ranked among the bluest of blue chips, Kodak shares sell today at close to $1. Kodak's chairman has been denying that the company is contemplating a bankruptcy filing with such vehemence that many believe Chapter 11 must lurk just around the corner.

The Rochester, N.Y., company said it had $862 million in cash on hand as of Sept. 30, but at the rate it's losing money from operations (more than $70 million a month), that hoard would barely last a year. As for future revenue, it's banking heavily on winning patent lawsuits against Apple and the maker of BlackBerry phones.

Kodak Brownie and Instamatic cameras were once staples of family vacations and holidays — remember the "open me first" Christmas ad campaigns? But it may not be long before a generation of Americans grows up without ever having laid hands on a Kodak product. That's a huge comedown for a brand that was once as globally familiar as Coca-Cola.

It's hard to think of a company whose onetime dominance of a market has been so thoroughly obliterated by new technology. Family snapshots? They're almost exclusively digital now, and only a tiny fraction ever get printed on paper.

Eastman Kodak engineers invented the digital camera in 1975; but now that you can point and click with a cheap cellphone, even the stand-alone digital camera is becoming an endangered species on the consumer electronics veld. The last spool of yellow-boxed Kodachrome rolled out the door of a Mexican factory in 2009. Paul Simon composed his hymn to Kodachrome in 1973, but his camera of choice, according to the lyrics, was a Nikon.

It's not uncommon for great companies to be humbled by what the Austrian economist Joseph Schumpeter called the forces of "creative destruction." Technology, especially digital technology, has been the most potent whirlwind sweeping away old markets and old strategies for many decades. Changing economics and global competition have reduced behemoths of the past, such as General Motors, into mice of the present.

Kodak's decline is of a different order from GM's. The latter still manufactures a product with a huge market demand; it just got sloppy and inefficient at turning out its cars and trucks. That's why the federal government, not to mention GM's unions and other stakeholders, thought a dramatic restructuring might put it back on its feet. (That it was a central player in an industry employing hundreds of thousands of Americans was part of the calculus too.)

Kodak, however, markets a process technology; and as the chemistry of film has yielded to digital electronics, consumer demand for Kodak's traditional products has evaporated. A similar transition afflicts newspapers, book publishers, movie studios, broadcasters and record labels today, but the issues for those industries are different yet.

Their business models are under pressure because they're dependent on outdated distribution technologies; but their core products (information, entertainment) are still very much in demand.

So Kodak has faced a tougher challenge than automakers or content producers. Still, it has met the challenge ham-handedly. This is characteristic of companies that have enjoyed what one might think of as success on a tragic scale.

Almost from Kodak's founding by George Eastman in 1880, the money had rolled in, thanks to Eastman's razor-blade strategy of selling cameras cheaply and reaping lavish margins from consumables — film, chemicals and paper.

As late as 1976, Kodak commanded 90% of film sales and 85% of camera sales in the U.S., according to a 2005 case study for Harvard Business School. Such seemingly unassailable competitive positions tend to foster unimaginative executive cultures, and Kodak's was no exception.

Even after Fuji Photo crept into the U.S. market with lower-priced film and supplies, Kodak refused to believe Americans would ever desert its sacred brand. Complacently, the company spurned the chance to become the official film of the 1984 Los Angeles Olympics; the bid went instead to Fuji, which exploited its sponsorship to win a permanent foothold in the marketplace.

Then came digital. Far from scorning the new technology, Kodak ramped up research and development to nearly 10% of sales in the mid-1980s and integrated digital features into its product lines, including video systems, scanners and photo enhancement software.

But its executives couldn't foresee a future in which film had no role in image capture at all, nor come to grips with the lower profit margins or faster competitive pace of high-tech industries. At one meeting with Microsoft's Bill Gates to discuss integrating Kodak's photo CDs with Windows, Kodak Chairman Kay Whitmore fell asleep.

Whitmore was succeeded by George M.C. Fisher, who as the former CEO of Motorola had a better grasp of high tech. Fisher reached out to Microsoft and other new consumer merchandisers. For example, Apple's pioneering QuickTake consumer digital cameras, introduced in 1994, were mostly Kodak products with Apple nameplates. But Fisher never conceived of an entirely filmless world, either.

Under Fisher's successor, Daniel Carp, Kodak moved headlong into digital photography, but at a cost. In 2001 it held the No. 2 spot in U.S. digital camera sales (behind Sony), but its executives acknowledged it was losing $60 on every camera sold. By last year it ranked fourth. And it can hardly escape the company's notice that an ever-smaller percentage of digital pictures are being taken on digital cameras, as opposed to cellphones and tablets.

As time passes, Kodak looks more and more like a truck spinning its wheels in mud. The company hasn't had a profitable year since 2007. Its current chairman, Antonio Perez (a former executive at Hewlett-Packard, another company riding on bald tires), said last month on announcing Kodak's dismal third-quarter results that he's delighted in the profit prospects for its inkjet printers. But does anybody else out there think that desktop printing is a growth market?

Kodak's biggest revenue score of 2010 was $838 million it collected from patent licensing, evidently including a settlement it reached with LG after suing the South Korean company for patent infringement. Through the first three quarters of this year, the same category produced zero. But Perez is still hoping for a big score from another patent sale.

It may be premature to write Kodak off. After all, the company does have more than a century's experience in consumer marketing and a technology portfolio potentially worth billions. But companies that can remake themselves to survive changes on the scale of what Kodak confronts are rare indeed.

IBM has done so, and General Electric, but not many others.

Kodak was once such a pervasive part of our lives that the "Kodak moment," defined as a personal event that demanded to be recorded for posterity, entered our lexicon.

Now when even the most private Kodak moment seems to unfold before the digital gaze of a hundred iPhones, it looks as though Kodak's moment has passed. The circle of life in business is a natural phenomenon, the lesson of which shouldn't be overlooked by companies that seem to have cemented themselves into permanent spots at the top of the world today — including Apple, Google and Facebook. The lesson is: Nothing lasts forever.
http://www.latimes.com/business/la-f...,507980.column





The Personal Computer is Dead
Jonathan Zitttrain

The PC is dead. Rising numbers of mobile, lightweight, cloud-centric devices don't merely represent a change in form factor. Rather, we're seeing an unprecedented shift of power from end users and software developers on the one hand, to operating system vendors on the other—and even those who keep their PCs are being swept along. This is a little for the better, and much for the worse.

The transformation is one from product to service. The platforms we used to purchase every few years—like operating systems—have become ongoing relationships with vendors, both for end users and software developers. I wrote about this impending shift, driven by a desire for better security and more convenience, in my 2008 book The Future of the Internet—and How to Stop It.

For decades we've enjoyed a simple way for people to create software and share or sell it to others. People bought general-purpose computers—PCs, including those that say Mac. Those computers came with operating systems that took care of the basics. Anyone could write and run software for an operating system, and up popped an endless assortment of spreadsheets, word processors, instant messengers, Web browsers, e-mail, and games. That software ranged from the sublime to the ridiculous to the dangerous—and there was no referee except the user's good taste and sense, with a little help from nearby nerds or antivirus software. (This worked so long as the antivirus software was not itself malware, a phenomenon that turned out to be distressingly common.)

Choosing an OS used to mean taking a bit of a plunge: since software was anchored to it, a choice of, say, Windows over Mac meant a long-term choice between different available software collections. Even if a software developer offered versions of its wares for each OS, switching from one OS to another typically meant having to buy that software all over again.

That was one reason we ended up with a single dominant OS for over two decades. People had Windows, which made software developers want to write for Windows, which made more people want to buy Windows, which made it even more appealing to software developers, and so on. In the 1990s, both the U.S. and European governments went after Microsoft in a legendary and yet, today, easily forgettable antitrust battle. Their main complaint? That Microsoft had put a thumb on the scale in competition between its own Internet Explorer browser and its primary competitor, Netscape Navigator. Microsoft did this by telling PC makers that they had to ensure that Internet Explorer was ready and waiting on the user's Windows desktop when the user unpacked the computer and set it up, whether the PC makers wanted to or not. Netscape could still be prebundled with Windows, as far as Microsoft was concerned. Years of litigation and oceans of legal documents can thus be boiled down into an essential original sin: an OS maker had unduly favored its own applications.

When the iPhone came out in 2007, its design was far more restrictive. No outside code at all was allowed on the phone; all the software on it was Apple's. What made this unremarkable—and unobjectionable—was that it was a phone, not a computer, and most competing phones were equally locked down. We counted on computers to be open platforms—hard to think of them any other way—and understood phones as appliances, more akin to radios, TVs, and coffee machines.

Then, in 2008, Apple announced a software development kit for the iPhone. Third-party developers would be welcome to write software for the phone, in just the way they'd done for years with Windows and Mac OS. With one epic exception: users could install software on a phone only if it was offered through Apple's iPhone App Store. Developers were to be accredited by Apple, and then each individual app was to be vetted, at first under standards that could be inferred only through what made it through and what didn't. For example, apps that emulated or even improved on Apple's own apps weren't allowed.

The original sin behind the Microsoft case was made much worse. The issue wasn't whether it would be possible to buy an iPhone without Apple's Safari browser. It was that no other browser would be permitted—or, if permitted, it would be only through Apple's ongoing sufferance. And every app sold for the iPhone would have 30 percent of its price (and later, that of its "in-app purchases") go to Apple. Famously proprietary Microsoft never dared to extract a tax on every piece of software written by others for Windows—perhaps because, in the absence of consistent Internet access in the 1990s through which to manage purchases and licenses, there'd be no realistic way to make it happen.

Fast forward 15 years, and that's just what Apple did with its iOS App Store.

In 2008, there were reasons to think that this situation wasn't as worrisome as Microsoft's behavior in the browser wars. First, Apple's market share for mobile phones was nowhere near Microsoft's dominance in PC operating systems. Second, if the completely locked-down iPhone of 2007 (and its many counterparts) was okay, how could it be wrong to have one that was partially open to outside developers? Third, while Apple rejected plenty of apps for any reason—some developers were fearful enough of the ax that they confessed to being afraid to speak ill of Apple on the record—in practice, there were tons of apps let through; hundreds of thousands, in fact. Finally, Apple's restrictiveness had at least some good reason behind it independent of Apple's desire for control: rising amounts of malware meant that the PC landscape was shifting from anarchy to chaos. The wrong keystroke or mouse click on a PC could compromise all its contents to a faraway virus writer. Apple was determined not to have that happen with the iPhone.

By late 2008, there was even more reason to relax: the ribbon was cut on Google's Android Marketplace, creating competition for the iPhone with a model of third-party app development that was a little less paranoid. Developers still registered in order to offer software through the Marketplace, but once they registered, they could put software up immediately, without review by Google. There was still a 30 percent tax on sales, and line-crossing apps could be retroactively pulled from the Marketplace. But there was and is a big safety valve: developers can simply give or sell their wares directly to Android handset owners without using the Marketplace at all. If they didn't like the Marketplace's policies, it didn't mean they had to forgo ever reaching Android users. Today, Android's market share is substantially higher than the iPhone's. (To be sure, that market share is inverted in the tablet space; currently 97 percent of tablet Web traffic is accounted for by iPads. But as new tablets are introduced all the time—the flavor of the month just switched to Kindle Fire, an Android-based device—one might look at the space and see what antitrust experts call a "contestable" market, which is the kind you want to have if you're going to suffer market dominance by one product in the first place. The king can be pushed down the hill.)

With all of these beneficial developments and responses between 2007 and 2011, then, why should we be worried at all?

The most important reasons have to do with the snowballing replicability of the iPhone framework. The App Store model has boomeranged back to the PC. There's now an App Store for the Mac to match that of the iPhone and iPad, and it carries the same battery of restrictions. Some restrictions, accepted as normal in the context of a mobile phone, seem more unfamiliar in the PC landscape.

For example, software for the Mac App Store is not permitted to make the Mac environment look different than it does out of the box. (Ironic for a company with a former motto importuning people to think different.) Developers can't add an icon for their app to the desktop or the dock without user permission, an amazing echo of what landed Microsoft in such hot water. (Though with Microsoft, the problem was prohibiting the removal of the IE icon—Microsoft didn't try to prevent the addition of other software icons, whether installed by the PC maker or the user.) Developers can't duplicate functionality already on offer in the Store. They can't license their work as Free Software, because those license terms conflict with Apple's.

The content restrictions are unexplored territory. At the height of Windows's market dominance, Microsoft had no role in determining what software would and wouldn't run on its machines, much less whether the content inside that software was to be allowed to see the light of screen. Pulitzer Prize-winning editorial cartoonist Mark Fiore found his iPhone app rejected because it contained "content that ridicules public figures." Fiore was well-known enough that the rejection raised eyebrows, and Apple later reversed its decision. But the fact that apps must routinely face approval masks how extraordinary the situation is: tech companies are in the business of approving, one by one, the text, images, and sounds that we are permitted to find and experience on our most common portals to the networked world. Why would we possibly want this to be how the world of ideas works, and why would we think that merely having competing tech companies—each of which is empowered to censor—solves the problem?

This is especially troubling as governments have come to realize that this framework makes their own censorship vastly easier: what used to be a Sisyphean struggle to stanch the distribution of books, tracts, and then websites is becoming a few takedown notices to a handful of digital gatekeepers. Suddenly, objectionable content can be made to disappear by pressuring a technology company in the middle. When Exodus International—"[m]obilizing the body of Christ to minister grace and truth to a world impacted by homosexuality"—released an app that, among other things, inveighed against homosexuality, opponents not only rated it poorly (one-star reviews were running two-to-one against five-star reviews) but also petitioned Apple to remove the app. Apple did.

To be sure, the Mac App Store, unlike its iPhone and iPad counterpart, is not the only way to get software (and content) onto a Mac. You can, for now, still install software on a Mac without using the App Store. And even on the more locked-down iPhone and iPad, there's always the browser: Apple may monitor apps' content—and therefore be seen as taking responsibility for it—but no one seems to think that Apple should be in the business of restricting what websites Safari users can visit. Question to those who stand behind the anti-Exodus petition: would you also favor a petition demanding that Apple prevent iPhone and iPad users from getting to Exodus's website on Safari? If not, what's different, since Apple could trivially program Safari to implement such restrictions? Does it make sense that South Park episodes are downloadable through iTunes, but the South Park app containing the same content was banned from the App Store?

Given that outside apps can still run on a Mac and on Android, it's worth asking what makes the Stores and Marketplaces so dominant—compelling enough that developers are willing to run the gauntlet of approval and take a 30 percent hit on revenue instead of simply selling their apps directly. The iPhone restricts outside code, but developers could still, in many cases, manage to offer functionality through a website accessible through the Safari browser. Few developers do, and there's work to be done to ferret out what separates the rule from the exception. The Financial Times is one content provider that pulled its app from the [iOS] App Store to avoid sharing customer data and profits with Apple, but it doesn't have much company.

The answer may lie in seemingly trivial places. Even one or two extra clicks can dissuade a user from consummating what he or she meant to do—a lesson emphasized in the Microsoft case, where the ready availability of IE on the desktop was seen as a signal advantage over users' having to download and install Netscape. The default is all-powerful, a notion confirmed by the value of deals to designate what search engine a browser will use when first installed. Such deals provided 97 percent of Firefox-maker Mozilla's revenue in 2010—$121 million. The safety valve of "off-road" apps seems less helpful when people are steered so effortlessly to Stores and Marketplaces for their apps.

Security is also a factor—consumers are willing to consign control over their code to OS vendors when they see so much malware out in the wild. There are a variety of approaches to dealing with the security problem, some of which include a phenomenon called sandboxing—running software in a protected environment. Sandboxing is soon to be required of Mac App Store apps. More information on sandboxing, and a discussion of its pros and cons, can be found here.

The fact is that today's developers are writing code with the notion not just of consumer acceptance, but also vendor acceptance. If a coder has something cool to show off, she'll want it in the Android Marketplace and the iOS App Store; neither is a substitute for the other. Both put the coder into a long-term relationship with the OS vendor. The user gets put in the same situation: if I switch from iPhone to Android, I can't take my apps with me, and vice versa. And as content gets funneled through apps, it may mean I can't take my content, either—or, if I can, it's only because there's yet another gatekeeper like Amazon running an app on more than one platform, aggregating content. The potentially suffocating relationship with Apple or Google or Microsoft is freed only by a new suitor like Amazon, which is structurally positioned to do the same thing.

A flowering of innovation and communication was ignited by the rise of the PC and the Web and their generative characteristics. Software was installed one machine at a time, a relationship among myriad software makers and users. Sites could appear anywhere on the Web, a relationship among myriad webmasters and surfers. Now activity is clumping around a handful of portals: two or three OS makers that are in a position to manage all apps (and content within them) in an ongoing way, and a diminishing set of cloud hosting providers like Amazon that can provide the denial-of-service resistant places to put up a website or blog.

Both software developers and users should demand more. Developers should look for ways to reach their users unimpeded, through still-open platforms, or through pressure on the terms imposed by the closed ones. And users should be ready to try "off-roading" with the platforms that still allow it—hewing to the original spirit of the PC, perhaps amplified by systems that let apps have a trial run on a device without being given the keys to the kingdom. If we allow ourselves to be lulled into satisfaction with walled gardens, we'll miss out on innovations to which the gardeners object, and we'll set ourselves up for censorship of code and content that was previously impossible. We need some angry nerds.
http://www.law.harvard.edu/news/2011...r-is-dead.html





Microsoft Can Remotely Kill Purchased Apps
Mark Hachman

Microsoft's terms of service for its Windows Store allows the company to remotely "kill" or remove access to a user's apps for security or legal reasons, it said.

As noted by Computerworld, Microsoft's terms of service for the Windows store will technically allow the company to cut off access to apps, even if the user purchased them.

Microsoft unveiled an app store for Windows 8 apps, on Tuesday. The key ingredients of the Windows Store are easy app discovery from within and without the online marketplace, built-in app trials with quick upgrade paths, support for both x86 and ARM-based hardware, and a flexible business model, Microsoft's Antoine Leblond said then.

Microsoft addresses the possibility that it might remove apps under the heading, "Can Microsoft remove apps or data from my device?"

"We may change or discontinue certain apps or content offered in the Windows Store at any time, for any reason," the company says. "Sometimes, we do so to respond to legal or contractual requirements. In cases where your security is at risk, or where we're required to do so for legal reasons, you may not be able to run apps or access content that you previously acquired or purchased a license for.

"In cases where we remove a paid app from your Windows 8 Beta device not at your direction, we may refund to you the amount you paid for the license," Microsoft added. "Some apps may also stop working if you update or change your Windows 8 Beta device, or if you attempt to use those apps on a Windows 8 Beta device with different features or processor type. You are responsible for backing up the data that you store in apps that you acquire via the Windows Store, including content you upload using those apps. If the Windows Store, an app, or any content is changed or discontinued, your data could be deleted or you may not be able to retrieve data you have stored. We have no obligation to return data to you. If sign in information or other data is stored with an expiration date, we may also delete the data as of that date."

Microsoft also noted that there is no "cooling off" period where users have the right to "return" a paid-for app and receive a refund, unless permitted by state law. Google's Android Market has a cooling-off period of just 15 minutes. Amazon's own Android app store has no such cooling-off period, but it also has a test-drive feature that allows users to try out a paid Android app on a PC, for free, via a version of it running in the cloud. Apple does not offer any cooling-off period for paid iOS apps.
http://www.pcmag.com/article2/0,2817,2397414,00.asp





HP's Decision Means webOS Could End Up More Open than Android
Ryan Paul

The ultimate fate of HP's webOS mobile platform was finally revealed today. The company has announced plans to contribute its operating system to the open source software community. The move will open the door for other hardware manufacturers to adopt the operating system and ship it on their own devices.

We called for HP to open webOS last month in response to rumors that were circulating about the operating system's future. As we pointed out at the time, key components of the webOS userspace stack have considerable value. We argued that HP, existing webOS users, and the open source software community would all benefit if the platform were opened. HP apparently reached the same conclusion.

"webOS is the only platform designed from the ground up to be mobile, cloud-connected, and scalable," said HP CEO Meg Whitman. "By contributing this innovation, HP unleashes the creativity of the open source community to advance a new generation of applications and devices."

In a statement issued today, HP said that the underlying webOS code will be published under an open source license. The company will continue to play an active role in funding and developing the platform. Ongoing development will be undertaken in collaboration with the open source software community and other interested parties through a "good, transparent and inclusive governance" model.

After releasing the webOS platform itself as open source, HP says it will also open the ENYO JavaScript framework and "remaining components of the user space" stack. HP's stated goal of opening up webOS as a "pure open source project" suggests that the platform could end up being more open than Android, which is still tightly controlled by Google despite being distributed under an open source license.

It's not clear yet whether HP intends to continue shipping new mobile devices with webOS. The company's statement says unambiguously that the company will continue to invest in the platform and sees in webOS the long-term potential "to improve applications and web services for the next generation of devices." It doesn't, however, indicate whether we can expect to see new webOS smartphones from HP in the near future.

Regardless of whether new webOS hardware emerges from HP, the opening of the platform will still have tremendous value. The availability of webOS under an open license will likely enable third-party developers to produce custom ROM images for existing webOS devices, such as the HP Touchpad. It will also open the door for other hardware vendors such as HTC or Samsung to build their own webOS devices.

Another significant win for developers is the possibility of porting the webOS platform's sophisticated HTML application runtime environment to other operating systems. This could allow webOS applications to eventually run seamlessly on Android devices or even desktop platforms.

There are still many licensing and governance decisions that need to be made before the effort will move forward. HP says that it wants to involve the open source software community in the process of making those decisions. That seems like a good way to get started and ensure that the project is inclusive from the start.
http://arstechnica.com/business/news...an-android.ars





Apple Made A Deal With The Devil (No, Worse: A Patent Troll)
Jason Kincaid

Over the last two years, Apple has been engaged in vicious legal battles over smartphone patents, many of which are aimed at squelching (or squeezing money out of) manufacturers of devices running Android. And now, for some reason, it has given valuable patents to a patent troll — which is using them to sue many of the top technology companies in the world.

Meet Digitude Innovations, a firm based in Virginia that recently filed suit with the International Trade Commission alleging patent infringement by technology companies including RIM, HTC, LG, Motorola, Samsung, Sony, Amazon, and Nokia (note that Apple is not on this list). The ITC is a favorite for companies litigating over mobile phone patent disputes, as it can block the import of products long before a case has actually concluded.

Digitude was founded in 2010 and raised $50 million from Altitude Capital Partners, with aims to “acquire, aggregate, and license key technology areas within the consumer electronics and related technology fields in a patent consortium” — in other words, it buys up patents and then sues other companies until they settle and agree to pay licensing fees, because it’s generally less expensive than actually going to court.

From a Forbes article this past June:

Digitude is a new kind of patent investment vehicle because it seeks to team up with strategic players that can invest in Digitude not with money, but by contributing patents. The contributing entity would then get a license for all of Digitude’s patents, [Digitude Chairman Robert] Kramer says.

In April, Digitude announced the “completion of its first such strategic partnership with one of the world’s leading consumer electronics companies” — which it didn’t name. The company later announced that additional (unnamed) parties have jumped on board as well, who will receive a portion of Digitude’s proceeds based on the value of the IP each party contributed.

Apple appears to be one of these participants, and may be the unnamed leading consumer electronics company that Digitude boasted about this past spring. Of the four patents that Digitude included in its claim this week, two were owned by Apple earlier this year, before they were transferred to Digitude.

The patents in question:

USPTO #6208879 — Mobile Information Terminal Equipment and Portable Electronic Apparatus

USPTO #6456841 — Mobile Communication Apparatus Notifying User Of Reproduction Waiting Information Effectively

In both cases, Apple transferred ownership of the patent to a company called Cliff Island LLC, which in turn transferred it to Digitude Innovations. In fact, Apple has transferred a dozen patents to Cliff Island LLC this year (though only two of these were named in this ITC suit).

You probably haven’t heard of Cliff Island LLC, because it appears to exist in name only. There is a next to no information about the company available online — though the patent filing does include an address: 485 Madison Avenue, Suite 2300 in New York City.

I was unable to find a phone number for the company, so I attempted to pay a visit to their office, only to find that it doesn’t appear to exist. But there are other tenants on the twenty-third floor of 485 Madison. One of which is Altitude Capital, the same IP-focused private equity firm that happened to lead Digitude’s $50 million funding round.

Put another way, Apple appears to have transferred its patents to the patent troll Digitude, though it first routed them through a shell company that shares the same office as Digitude’s lead investor and Chairman. Further evidence of the relationship between Apple and Digitude can be found on the ITC’s own website, where a list of files relevant to the lawsuit can be found. Many of these files are marked confidential, but it appears someone mistakenly left the file names intact. One of which is “Digitude-Apple License Agreement” (see screenshot below).

So what is going on? There are a pair of scenarios that seem plausible — though both of them are strange.

The first is that Apple is using Digitude as a hired gun of sorts in its patent offensive, giving the company valuable patents to wield against its opponents (while avoiding the waves of press that are spurred by each new lawsuit). But Apple hasn’t exactly been quiet about suing its rivals over smartphone patents, so it’s not clear what they’d gain from this.

The alternative is that Apple has given some of its patents to Digitude because the patent troll came after it first. The dozen patents Apple has handed over may have been part of a settlement with the firm, along with the license agreement (which would presumably give Apple the rights to its patents, and additional Digitude patents). This seems more likely.

But even if Digitude shot first, so to speak, it’s still hard to see Apple in a positive light here. This is Apple we’re talking about. The idea that the company didn’t have any options other than handing over valuable patents to a patent troll — knowing full well that it would then use those patents to sue other tech companies — seems ludicrous.

I spoke with Julie Samuels, Staff Attorney at the Electronic Frontier Foundation who focuses on patents, who points out that in some cases certain companies will sell their patents to other parties when they’re under financial stress. But Apple clearly doesn’t fall into that bucket.

If Apple were deliberately aiding Digitude, Samuels says “it would be horrifying — the patent troll problem is completely out of control. Apple has every legal right to sue over its patents, but it should be the one to do it”.

And if Apple was indeed threatened first by Digitude, and only handed over its patents as part of a settlement, she says she “cannot imagine any reasonable scenario where Apple didn’t have any other options”.

Both Apple and Digitude declined to comment.

Also, oddly, Digitude Innovations had a website as recently as December 4, but it apparently took it down in the last few days.
http://techcrunch.com/2011/12/09/app...-patent-troll/





Grassley Stands by Threat to Hold Up FCC Nominees Over Wireless Network Concerns

Sen. Charles Grassley is standing by his threat to place a hold on two nominees to the Federal Communications Commission over concerns about a controversial new wireless network the agency has allowed to move forward.

The Iowa Republican this week accused the FCC of refusing to comply with his requests for information on its discussions with Virginia company LightSquared regarding its next-generation national wireless network.

Some fear the network would hinder the effectiveness of high-precision GPS systems -- used by the military, farmers and others. Grassley also raised questions about the involvement of Harbinger, the hedge fund behind the project and founded by Democratic donor Philip Falcone.

Grassley has asked the FCC for information about its discussions with other agencies regarding the network, as well as discussions with LightSquared and its parent company, and about testing that may have been performed on possible GPS interference.

Grassley claims the FCC has not cooperated.

"There's nothing new on whether the FCC will provide the information I requested," Grassley said in a statement. "As a result, my intention to place a hold on the FCC nominees, should they reach the floor, stands.

"The FCC needs to make itself accountable to Congress and the American people. An agency with control over a major piece of the economy can't be allowed to operate as a closed shop," he said.

Grassley first threatened a month ago to hold up nominees over his concerns.

A representative with the FCC did not return a request for comment.

The nominees caught in the crossfire are Jessica Rosenworcel and Ajit Varadaraj Pai, who came before the Senate Committee on Commerce, Science, and Transportation this week for their nomination hearing. Rosenworcel is a senior attorney for a Senate Commerce subcommittee; Pai is an attorney with experience at the FCC.

As Grassley threatened to sideline the nominations, Committee Chairman Sen. John Rockefeller, D-W.Va., described them as "devoted public servants" and called for quick confirmation.

"Both have a background at the FCC, Congress, and the private sector, which allows them to have a deep understanding of communications policy and the impact it has on everyday life in our country," he said in a statement.

But Grassley is using them as leverage to find out more about the potential interference the LightSquared network could cause to GPS systems. A primary concern is the system's impact on the military.

An Air Force general testified earlier this year that the network's signals would interfere with GPS receivers based on testing. At the time, sources claimed the general was pressured to change his testimony to favor LightSquared -- though Falcone later denied claims of political interference.

The company has since announced plans to develop filters and take other steps to mostly eliminate the interference problem. But farmers are still concerned about the technology, considering they depend on GPS systems for everything from driving tractors to watering plants.

At a hearing in October, agriculture industry representatives voiced concern about the program, while crop producers wrote to the FCC urging the agency to conduct more testing.
http://www.foxnews.com/politics/2011...eless-network/





Exclusive: Apple Versus Samsung Ruling Divulges Secret Details
Dan Levine and Carlyn Kolker

A court error on Friday offered a brief glimpse at information that Apple Inc and Samsung Electronics have tried to shield from the public during their high-stakes patent litigation.

The material appears to be less important for what it says about the companies than what it reveals about efforts to keep court proceedings secret.

In denying Apple's bid to stop Samsung from selling its Galaxy smartphone and tablets in the United States, District Judge Lucy Koh's ruling inadvertently included details she had intended to black out. The judge's staff quickly realized the error, sealed the electronic document and posted a redacted version four hours later.

The fuller version, which Reuters obtained while it was publicly available, did not expose the technical inner workings of the iPad -- or anything close. Rather, it contained internal company analysis about the smartphone market, as well as some details about Apple's patent licensing relationships with other tech companies.

The lawsuit, which Apple filed in April in a San Jose, California, federal court, says Samsung's Galaxy products "slavishly" copy the iPhone and iPad. The South Korean electronics maker says Apple's arguments lack merit.

The case is scheduled for trial next year. The Friday ruling means Samsung can continue selling Galaxy products for now.

Sealing documents has become standard in intellectual property cases. Investors, academics and other observers have expressed concern that some judges too readily accede to litigants' claims that documents contain trade secrets and must be kept private.

Judges have wide latitude in granting company sealing requests, and Koh has granted all of Apple and Samsung's requests to keep documents secret in the case.

Some crucial legal briefs from both companies were kept entirely secret for months, and then released with redactions. After an inquiry from Reuters last week, Koh issued new guidelines so that redacted briefs become public much sooner.

Timothy Holbrook, an intellectual property professor at Emory Law in Atlanta who reviewed Koh's Friday ruling at Reuters' request, said there did not appear to be any trade secrets among the blacked-out portions.

"Most of it just seems like it was sealed out of an abundance of caution," Holbrook said.

In an email on Monday, Koh declined to comment on a pending case. Representatives for Apple and Samsung also declined to comment.

Smartphone, Tablet Battle

The California case is just one battleground in Apple and Samsung's bruising legal war, which includes more than 20 cases in 10 countries as they jostle for the top spot in the smartphone and tablet markets.

Global tablet sales are expected to explode to more than 50 million in 2011. Apple, which has sold more than 30 million iPads so far, is expected to continue to dominate the market in the near term.

While Amazon.com has also entered the fray with its Kindle Fire tablet, Samsung's Galaxy line-up is widely deemed the closest rival to the iPad in terms of capability and design.

In her 65-page ruling denying Apple's request for a preliminary injunction against Samsung, Koh attempted to redact nearly two dozen sentences or short fragments. But because of a formatting characteristic in the prior electronic version, the redacted material can be viewed by copying text from the PDF and pasting it into another document.

The version now available to the public cannot be viewed in such a manner.

According to the redacted portions, Apple's own studies show that existing customers are unlikely to switch from iPhones to Samsung devices. Instead, the evidence suggests an increase in sales of Samsung smartphones is likely to come at the expense of other smartphones with Android operating systems, Koh wrote.

In arguing against the injunction, Samsung -- which is also a huge components supplier to Apple -- said Apple's supply cannot keep up with market demand for smartphone products. Koh recounted the argument in the redacted portions of the ruling.

But Koh then called Samsung's argument "dubious," given rebuttal evidence presented by Apple regarding its ability to keep up with demand in the long term.

The redacted portions also refer to licensing deals that Apple struck with other high-tech companies over one of its key patents. Issued in December 2008, the patent covers the method of scrolling documents and images on Apple's touch-screen devices.

Apple has already licensed the patent to IBM and Nokia, according to the ruling. A technology blog, The Verge, first reported this detail on Saturday; the blog said it had been shown two statements that were redacted from the ruling.

Scant information has previously been made available about Apple's licensing deals with Nokia or IBM.

While Apple and Nokia publicly announced a patent settlement for an undisclosed sum in June, they did not divulge any specifics, except to say the agreement resolved all litigation between the companies and that Apple would make a one-time payment to Nokia and pay future royalties. At the time, the settlement was viewed as a victory for Nokia.

There appears to be no reference to any patent-licensing deal for mobile technology between IBM and Apple either in news archives or company regulatory filings.

"Apple doesn't license much, and it could be that they don't want people to know who the licensees are," said Holbrook, the IP professor.

Representatives for IBM and Nokia did not immediately respond to requests for comment on Monday.

Samsung was also offered a royalty license during negotiations with Apple in November 2010, the ruling says, five months before Apple wound up suing Samsung in the United States.

Apple has brought claims against Samsung based on design patents -- which protect the look and feel of a device -- and so-called "utility" patents, which cover engineering innovations.

A footnote in the ruling says "it does not appear" that Apple and Samsung discussed design patents during their negotiations that preceded the lawsuit.

Yet since much of Koh's opinion covers design patents, the mistakenly released data does not reveal much about the inner workings of the technology, said Holbrook.

"There was nothing I saw that was shocking, just stuff that is not (otherwise) available to the public," he said.

The case in U.S. District Court, Northern District of California is Apple Inc v. Samsung Electronics Co Ltd et al, 11-1846.

(Reporting by Dan Levine in San Francisco and Carlyn Kolker in New York; Additional reporting by Jeremy Pelofsky in Washington; Editing by Martha Graybow and John Wallace)
http://www.reuters.com/article/2011/...7B425D20111206





E.U. Commission in E-Books Antitrust Probe of 5 Publishers, Apple

The European Commission is investigating whether e-book publishers owned by Lagardere, Pearson Plc, News Corp. and two other firms may have colluded with Apple to block rivals via their pricing deals.

The decision by the European Commission to open an investigation on Tuesday followed raids on the companies in March this year.

U.S. regulators are also looking into pricing deals imposed under an agency model in which publishers set the retail price. Antitrust rules forbid price-fixing agreements designed to shut out competitors.

In the traditional "wholesale model," publishers set a recommended retail price, but the seller is free to offer deep discounts.

"The Commission will in particular investigate whether these publishing groups and Apple have engaged in illegal agreements or practices that would have the object or the effect of restricting competition in the European Union or in the European Economic Area," the EU's executive Commission said in a statement.

"The Commission is also examining the character and terms of the agency agreements entered into by the above named five publishers and retailers for the sale of e-books," it said.

It identified the publishers as French media-to-aerospace group Lagardere's Hachette Livre unit, News Corp's Harper Collins, CBS Corp's Simon & Schuster, Pearson's Penguin and Verlagsgruppe Georg von Holzbrinck, which owns Macmillan in Germany.

A Pearson spokesman said the group would work with regulators in the investigation.

"Pearson does not believe it has breached any laws, and will continue to fully and openly cooperate with the Commission," the spokesman said.

Apple declined to comment.

E-books are fast gaining popularity in Europe and in Britain, e-books already account for about 10 percent of book sales by volume and a fifth of revenue.

Britain's Office of Fair Trading said on Tuesday it would coordinate with the EU regulator on the e-book sector and was closing its own investigation into the matter.

(Reporting by Foo Yun Chee; additional reporting by Kate Holton in London; Editing by Rex Merrifield and Jon Loades-Carter)
https://www.nytimes.com/reuters/2011...eu-ebooks.html





Online Uproar as India Seeks Social Media Screening
Devidutta Tripathy and Anurag Kotoky

India has urged social network companies including Facebook, Twitter and Google to remove offensive material, unleashing a storm of criticism from Internet users in the world's largest democracy complaining of censorship.

Telecoms and Information Technology Minister Kapil Sibal met executives from Facebook, Google, Yahoo and Microsoft on Monday to ask them to screen content, but no agreement with the companies was reached, he said.

Sibal denied he was promoting censorship and said some of the images and statements on social media sites risked fanning tensions in India, which has a long history of deadly religious violence.

A New York Times report on Monday that said Sibal called executives about six weeks ago and showed them a Facebook page that maligned ruling Congress Party chief Sonia Gandhi and told them it was "unacceptable".

The government is very sensitive to criticism of the Gandhi family. Last year there were moves to block the English translation of a Spanish novel about Sonia Gandhi's life.

"We have to take care of the sensibilities of our people, we have to protect their sensibilities. Our cultural ethos is very important to us," Sibal told reporters on Tuesday.

Sibal said his ministry was working on guidelines for action against companies who did not respond to the government's requests, but did not specify what action could be taken.

"We'll certainly evolve guidelines to ensure that such blasphemous material is not part of content on any platform."

India's largely unrestricted Internet access stands in contrast to tight controls in fellow Asian economic powerhouse China. But in line with many other government's around the world, India has become increasingly edgy about the power of social media.

India's bloggers and Twitter users scorned the minister's proposals, saying a prefiltering system would limit free expression and was impossible to implement. The phrase #IdiotKapilSibal was one of India's most tweeted on Tuesday.

"The idea of prescreening is impossible. How will they do it?...There is no technology currently that determines whether content is 'defamatory' or 'offensive'," India-based cyber security expert Vijay Mukhi told Reuters.

Taken Aback

The New York Times report, which Sibal did not confirm or deny, was the focus of much of the online anger directed at the minister on Tuesday.

"I love Sonia Gandhi. She is awesome. She is God. And never wrong about anything, ever." (This msg is approved by Kapil Sibal's cyber cell)," posted twitter user Sorabh Pant.

Indian authorities were taken aback in the summer by an anti-corruption campaign that multiplied on Facebook and Twitter, drawing tens of thousands of people to street protests and forcing the government to agree to new anti-graft laws.

Last year, as part of a broader electronic security crackdown, Indian security agencies demanded access to communications sent through highly secure BlackBerry devices of Canadian smartphone maker Research In Motion.

RIM gave India access to its consumer services, including its Messenger services, but said it could not allow monitoring of its enterprise email.

Facebook said it recognized the government's wish to minimize the amount of offensive content on the web. The California-based company said it removes content that violates company rules on nudity and inciting violence and hatred.

"(We) will continue to engage the Indian authorities as they debate this important issue," Facebook said in a statement.

Yahoo India declined to comment and Google said it would comment later in the day.

India now has 100 million Internet users, less than a tenth of the country's population of 1.2 billion. It is the third-largest user base behind China and the United States. It is seen swelling to 300 million users in the next three years.

During last year's clampdown, officials also said Google and Skype would be sent notices to set up local servers to allow full monitoring of email and messenger communications.

Britain also faced criticism last month for considering curbs on social media after recent riots even as Foreign Secretary William Hague castigated countries that block the Internet to stifle protests.

(Additional reporting by Shilpa Jamkhandikar in MUMBAI and Annie Banerji in NEW DELHI; Writing by Frank Jack Daniel; Editing by Malini Menon and Nick Macfie)
http://www.reuters.com/article/2011/...7B50CV20111206





Sending of Sexual Images by Minors Isn’t as Prevalent as Expected, Study Finds
Anahad O’Connor

One in 10 children ages 10 to 17 has used a cellphone to send or receive sexually suggestive images, but only 1 in 100 has sent images considered graphic enough to violate child pornography laws, a new study found.

The results of the study, published on Monday in the journal Pediatrics, are based on detailed telephone interviews with 1,560 children across the country. It is one of the largest surveys yet to look at the prevalence of sexting among minors, a phenomenon that has drawn concern from schools and law enforcement and that has prompted nationwide legislation trying to curb it.

An earlier, often-cited study had estimated that as many as one in five teenagers engaged in sexting, but it included 18- and 19-year-olds, most likely increasing the overall prevalence.

In recent years, high-profile cases in which teenagers were arrested for forwarding nude pictures of other minors have attracted nationwide attention. Despite sexting’s reputation as a teenage pastime, surveys now suggest that it is actually more common among young adults than children.

“It only takes one or two cases to make people think this is very prevalent behavior,” said Janis Wolak, an author of the new paper and a senior researcher at the Crimes Against Children Research Center at the University of New Hampshire. “This has been reported as if it were something that everyone was doing, not just in the teen population, but in the young adult population. It’s really not the case.”

Over all, the new report found, 149 youths interviewed for the study, or 9.6 percent, said they had sent or received images that included full or partial nudity in the previous year. Just over 2 percent of those who engaged in sexting said they had appeared in the pictures or had taken them themselves, and 7.1 percent said they received sexual images from someone else.

In most cases, the motivations for sending or forwarding sexual texts were not malicious. Most of the youths who sent such messages said that they did so with someone they were involved in a relationship with, or that their messages were flirtatious gestures to someone they had a romantic interest in.

About 31 percent who appeared in or took sexual images said that alcohol or drug use had been a factor. And despite public concerns about lewd photographs of minors that start out as private messages becoming widely distributed, only 3 percent of the minors in the study said they had forwarded sexual photographs that they had received.

The fact that about a third of sexual messages were created or sent when alcohol or drugs were involved suggests that the children who are doing the riskiest messaging are engaging in other risky behaviors as well, said Nancy Baym, a professor of communication studies at the University of Kansas and author of the book “Personal Connections in the Digital Age.”

But Dr. Baym, who was not involved in the study, said it was important that the research documented “that a considerable percentage of texting is not problematic, but an extension of the kinds of flirting and relationship-maintaining behavior that goes on in consensual teen relationships and stays within those relationships.”

In an accompanying study published in Pediatrics, Ms. Wolak and her colleagues also surveyed roughly 2,700 law enforcement agencies around the country in effort to look at incidents that led to police involvement. That study found that one-third of all incidents handled by the police involved adult sex offenders, who were usually soliciting sexual images from children.

Another third involved what the researchers called “aggravating circumstances,” like teenagers using pictures for blackmail or someone forwarding topless pictures of an ex after a breakup. The remaining third, which Ms. Wolak called “relatively benign,” were largely cases in which an adult discovered nude images on a child’s phone and then turned them over to a school or police official.

Most of the time, those cases did not lead to prosecution.

“It was reassuring that police did not seem to be overreacting,” Ms. Wolak said.

Amanda Lenhart, a senior research specialist at the Pew Research Center in Washington, noted that the report’s findings dovetailed with Pew research released last month. In that study, which involved 800 minors between 12 and 17, only 2 percent said they had sent nude or almost nude pictures to someone they knew. In contrast, the center found that 17 percent of adults between 18 and 29 had sent sexually suggestive pictures, and that 5 percent of 30- to 49-year-olds admitted sending them.

“There’s a zeitgeist in America socially that suggests that sexting is something that’s really prevalent,” Dr. Lenhart said. “I think this research shows that it actually isn’t that prevalent. It happens, but the likelihood of it happening to any given person is pretty low.”
https://www.nytimes.com/2011/12/05/s...udy-finds.html





Could the U.S. Government Start Reading Your Emails?

A new security research project is designed to scan millions of IMs, texts and emails every day.
John Brandon

Cherie Anderson runs a travel company in southern California, and she's convinced the federal government is reading her emails. But she's all right with that.

"I assume it's part of the Patriot Act and I really don't mind," she says. "I figure I'm probably boring them to death."

It's likely Anderson is not alone in her concerns that the government may be monitoring what Americans say, write, and read. And now there may be even more to worry about: a newly revealed security research project called PRODIGAL -- the Proactive Discovery of Insider Threats Using Graph Analysis and Learning -- which has been built to scan IMs, texts and emails . . . and can read approximately a quarter billion of them a day.

"Every time someone logs on or off, sends an email or text, touches a file or plugs in a USB key, these records are collected within the organization," David Bader, a professor at the Georgia Tech School of Computational Science and Engineering and a principal investigator on the project, told FoxNews.com.

PRODIGAL scans those records for behavior -- emails to unusual recipients, certain words cropping up, files transferred from unexpected servers -- that changes over time as an employee "goes rogue." The system was developed at Georgia Tech in conjunction with the Defense Advanced Research Projects Agency (DARPA), the Army's secretive research arm that works on everything from flying cars to robotic exoskeletons.

Initially, PRODIGAL will scan only the communications of military volunteers and people who work in federal agencies. But the very existence of such a project is sure to unnerve citizens like Anderson. Is the government reading my emails? Are they already monitoring me?

"Some people say it's one step further toward a police state," said Anthony Howard, a book author and security expert who has consulted for the Department of Homeland Security.

But Bader and other experts are quick to dismiss the idea that PRODIGAL could be used to monitor everyone in America. The scans work only on internal systems, they say -- not across the entire Internet. And the experts say such a project is long overdue: by monitoring for "anomalies" and predicting extreme behavior, catastrophes can be prevented, such as a soldier in good mental health becoming homicidal or a government employee sharing key classified information.

"Today, an analyst may receive tens of thousands of 'anomalies' per day, where an anomaly is an unexplained event," Bader said.

The new system is designed to aid analysts in processing those anomalies. And it's not alone.

Bader equated the PRODIGAL system to Raytheon SureView, an internal scanning system that looks for suspicious activity and alerts federal agencies about possible threats. Another system is the Einstein project, which was developed after 9/11 and scans government employees for key words and links suspicious activity to National Security Agency databases.

But PRODIGAL scans vastly more data than those systems: as much as a terabyte or more per day, what Georgia Tech described as "massive data sets."

PRODIGAL is part of an existing DARPA security project called Anomaly Detection at Multiple Scales (ADAMS), which was announced earlier this year. Details about how ADAMS works are not widely known; Georgia Tech's recent announcement is one of the first reports to explain how these detection engines work.

According to Bader, PRODIGAL uses complex "graph-processing" algorithms to analyze threats and piece together a jigsaw puzzle of communications. The system then ranks the unusual activity before feeding the most suspicious threats to agents.

Cyber-security expert Joseph Steinberg, CEO of Green Armor Solutions, said ADAMS is unique in that it scans through a massive stream of data. He says the new project, which will take about two years to develop and will cost $9 million, will be more effective at analyzing threats and determining if they are valid.

But the issue is not the scanning technology itself; it's how the information is interpreted -- and whether it ultimately helps at all, Howard told FoxNews.com.

"Since there is no real data publicly available to substantiate that any of this technology is preventing terrorist attacks or strengthening our borders from within, [we can't] really say definitively that this technology is doing any good," he said.

The challenge, he said, is that criminals and terrorists often use multiple channels of communication, some encrypted -- and know how to avoid existing detection systems.

Nevertheless, PRODIGAL's ability to scan reams of data is clearly the next step in tracking unusual activity, and it's guaranteed to raise a red flag for Anderson and others.

"Since people tend to be imperfect, the data captured can easily be mishandled. Where does it end?" Howard said.
http://news.discovery.com/tech/gover...cy-111203.html





C|Net Download.Com is now bundling Nmap with malware! From: Fyodor <fyodor () insecure org>
Date: Mon, 5 Dec 2011 14:35:30 -0800

Hi Folks. I've just discovered that C|Net's Download.Com site has
started wrapping their Nmap downloads (as well as other free software
like VLC) in a trojan installer which does things like installing a
sketchy "StartNow" toolbar, changing the user's default search engine
to Microsoft Bing, and changing their home page to Microsoft's MSN.

The way it works is that C|Net's download page (screenshot attached)
offers what they claim to be Nmap's Windows installer. They even
provide the correct file size for our official installer. But users
actually get a Cnet-created trojan installer. That program does the
dirty work before downloading and executing Nmap's real installer.

Of course the problem is that users often just click through installer
screens, trusting that download.com gave them the real installer and
knowing that the Nmap project wouldn't put malicious code in our
installer. Then the next time the user opens their browser, they
find that their computer is hosed with crappy toolbars, Bing searches,
Microsoft as their home page, and whatever other shenanigans the
software performs! The worst thing is that users will think we (Nmap
Project) did this to them!

I took and attached a screen shot of the C|Net trojan Nmap installer
in action. Note how they use our registered "Nmap" trademark in big
letters right above the malware "special offer" as if we somehow
endorsed or allowed this. Of course they also violated our trademark
by claiming this download is an Nmap installer when we have nothing to
do with the proprietary trojan installer.

In addition to the deception and trademark violation, and potential
violation of the Computer Fraud and Abuse Act, this clearly violates
Nmap's copyright. This is exactly why Nmap isn't under the plain GPL.
Our license (http://nmap.org/book/man-legal.html) specifically adds a
clause forbidding software which "integrates/includes/aggregates Nmap
into a proprietary executable installer" unless that software itself
conforms to various GPL requirements (this proprietary C|Net
download.com software and the toolbar don't). We've long known that
malicious parties might try to distribute a trojan Nmap installer, but
we never thought it would be C|Net's Download.com, which is owned by
CBS! And we never thought Microsoft would be sponsoring this
activity!

It is worth noting that C|Net's exact schemes vary. Here is a story
about their shenanigans:

http://www.extremetech.com/computing...ut-motivations

It is interesting to compare the trojaned VLC screenshot in that
article with the Nmap one I've attached. In that case, the user just
clicks "Next step" to have their machine infected. And they wrote
"SAFE, TRUSTED, AND SPYWARE FREE" in the trojan-VLC title bar. It is
telling that they decided to remove that statement in their newer
trojan installer. In fact, if we UPX-unpack the Trojan CNet
executable and send it to VirusTotal.com, it is detected as malware by
Panda, McAfee, F-Secure, etc:

http://bit.ly/cnet-nmap-vt

According to Download.com's own stats, hundreds of people download the
trojan Nmap installer every week! So the first order of business is
to notify the community so that nobody else falls for this scheme.
Please help spread the word.

Of course the next step is to go after C|Net until they stop doing
this for ALL of the software they distribute. So far, the most they
have offered is:

"If you would like to opt out of the Download.com Installer you can
submit a request to cnet-installer () cbsinteractive com All opt-out
requests are carefully reviewed on a case-by-case basis."

In other words, "we'll violate your trademarks and copyright and
squandering your goodwill until you tell us to stop, and then we'll
consider your request 'on a case-by-case basis' depending on how much
money we make from infecting your users and how scary your legal
threat is.

F*ck them! If anyone knows a great copyright attorney in the U.S.,
please send me the details or ask them to get in touch with me.

Also, shame on Microsoft for paying C|Net to trojan open source software!

Cheers,
Fyodor

http://seclists.org/nmap-hackers/2011/5





Ambulances Turned Away as Computer Virus Infects Gwinnett Medical Center Computers
Misty Williams and Joel Anderson

Gwinnett Medical Center on Friday confirmed it has instructed ambulances to take patients to other area hospitals when possible after discovering a system-wide computer virus that slowed patient registration and other operations at its campuses in Lawrenceville and Duluth.

Staff members discovered the virus Wednesday afternoon and have been working since then with outside I.T. experts to fix the problem, spokeswoman Beth Okun said. In the meantime, the health system has been forced to switch back to paperwork.

The situation is expected to last through the weekend, Okun said.

Patients were waiting longer at registration on Friday, and the virus also was affecting departments such as the pharmacy, radiology and labs. A system of runners are dealing with a variety of tasks, such as running orders down to the pharmacy or delivering X-rays to doctors.

“It is not impacting patient records,” nor has the quality of patient care been compromised, Okun said. “We’re still taking care of patients. We’re placing a great deal of importance on face-to-face care.”

The hospital is still treating patients in emergency situations but is asking people with minor ailments, such as sore throats or sprained ankles, to contact their regular providers, Okun said.

The infection, an “I.T. service interruption virus,” has affected systems intermittently, Okun said. Viruses are not an infrequent occurrence at the hospital, she said, but it’s never seen anything like this one. Law enforcement has not been contacted about the incident.

Gwinnett Medical went to total diversion status because it’s a trauma center and needs to be able to respond rapidly, Okun said. Hospitals sometimes divert patients to other facilities for issues such as running out of available emergency department beds.
Lt. Eric Eberly, spokesman for the Gwinnett County Fire Department, said ambulances have been diverting to other hospitals since Thursday afternoon.

“All our units are being diverted from their facilities … unless it’s severe respiratory distress problems or any kind of cardiac arrest or traumatic arrest situation," Eberly said. "Only dire emergencies are going to be accepted by Gwinnett Medical Center in Lawrenceville and Duluth.”

The other hospitals include Emory Eastside Medical Center, Atlanta; DeKalb Medical Center, Decatur; Walton Regional Medical Center, Monroe; and Northeast Georgia Medical Center, Gainesville, Eberly said.

-- Dispatch editor David Ibata contributed to this article.
https://www.ajc.com/news/gwinnett/am...s-1255750.html





Browser Study Sheds Light On Firefox's Insecurity (And Google Approves This Message)
Andy Greenberg

Updated with a response from Mozilla.

When Google funds a study on browser security and allows it to be published, perhaps it’s no surprise that Chrome comes out on top. More interesting is who comes out at the bottom: Google’s friends-quickly-becoming-frenemies at Mozilla.

Researchers at the security firm Accuvant released a study on Friday that gauges the security features of the top three web browsers: Google’s Chrome, Microsoft’s Internet Explorer, and Mozilla’s Firefox. The results show Google leading the way in innovating new safeguards, Microsoft running just behind, and Firefox sorely lacking in several significant areas. “Although both Google Chrome and IE are competitive, Chrome is a little better,” says Accuvant researcher Ryan Smith. And Mozilla? “We’ve tried to point out areas where Firefox can improve its code base,” Smith says politely.

Accuvant’s study, which was conducted independently but commissioned by Google, focused on exploit mitigations: Instead of counting vulnerabilities in the three browsers, it assumed that hackers would find hackable bugs in all three and instead compared how well they dealt with an attacker who has already gained some access to the machine. The browsers showed the most contrasts in three areas: Sandboxing, which limits what commands a website exploit’s access to a victim’s machine, a feature known as Just-In-Time or JIT hardening, which prevents javascript on websites from compiling code that it can run on the user’s machine, and plug-in security, which limits the access of not only exploits that run without user interaction on a site, but also those that attempt to trick users into downloading an add-on program that contains malicious commands.

In all three areas, Google tied or beat the competition. Its sandbox was found to be the strictest, while Accuvant says that Internet Explorer allowed hackers some file-reading capabilities even as it prevented them from installing malware. Its protections against malicious javascript were equal to Microsoft’s, and its limitations on the malicious capacities of plugins were stronger than either of the other two browsers. In all three categories, Firefox’s features were determined to be either “unimplemented or ineffective.”

Update: Mozilla’s director of Firefox engineering, Johnathan Nightingale, responds in a statement: “Firefox includes a broad array of technologies to eliminate or reduce security threats, from platform level features like address space randomization to internal systems like our layout frame poisoning system. Sandboxing is a useful addition to that toolbox that we are investigating, but no technology is a silver bullet. We invest in security throughout the development process with internal and external code reviews, constant testing and analysis of running code, and rapid response to security issues when they emerge. We’re proud of our reputation on security, and it remains a central priority for Firefox.”

Accuvant’s researchers argue that Google’s ability to start from scratch in creating Chrome allowed the company to incorporate new security features that were tougher to integrate into Firefox’s legacy code base. “Mozilla’s products were around before browser security was such a relevant issue,” says Accuvant researcher Chris Valasek. “Chrome was just born at the correct time in the correct environment.”

Despite the potential for a conflict of interest, Accuvant is a well-respected firm, and its researchers have performed a thorough and fair study, even making the tools they used to test the browsers publicly available. It’s no shock that Google’s browser was found to be relatively secure: In the annual widely-watched Pwn2Own hacking competitions, Chrome emerged three consecutive years unscathed, even after posting an extra $20,000 bounty for anyone who could break its sandbox restrictions.

Nor are Accuvant’s findings entirely positive for Google. It points out that Chrome fails to effectively blacklist malicious URLs, though neither of the other browsers fared better on that front.

But even if the research paper seems objective, Google’s funding of the report won’t help its fraying relationship with Mozilla. When asked by reporters recently, Google wouldn’t confirm that it was renewing its partnership with Mozilla to make Google the default search engine in Firefox, which provides 80 percent of the smaller company’s revenue. That uncertainty may have something to do with the fact that Firefox is no longer Google’s only weapon against Microsoft. In fact, Chrome overtook Firefox’s market share for the first time earlier this month.
http://www.forbes.com/sites/andygree...-this-message/





WikiLeaks Posts Spy Firm Videos Offering Tools For Hacking iTunes, Gmail, Skype
Andy Greenberg

It’s no longer a secret that firms like Gamma International, maker of Finfisher spyware, sell tools for hacking computers and secretly surveilling Internet and cell phone users. But nothing captures the creep factor of that business quite like the firm’s own low-budget, computer-animated marketing videos.

On Wednesday, WikiLeaks released a series of video files obtained from UK-based Gamma that show how its products can be used to monitor Wifi networks from a hotel lobby, hack cell phones and PCs with fake software updates, or infect computers from a USB key to intercept Skype conversations, log encryption passwords and read private files. The videos were posted as part of the secret-spilling group’s ongoing project in cooperation with Privacy International and Bugged Planet known as the Spy Files, which aims to collect and publish marketing documents and other revealing materials from technology firms that sell surveillance equipment.

While most of the capabilities shown in the videos have been previously revealed in a special report by the Wall Street Journal that published dozens of surveillance firms’ sales documents, the Journal had posted only screenshots and short segments of the videos, perhaps fearing that Gamma International would take legal action against the newspaper for copyright violations. WikiLeaks seems to have no such concerns.

After the downfall of Egyptian dictator Hosni Mubarak, the BBC obtained evidence that Gamma had offered its technology to the country’s regime for surveilling Egyptians’ use of tools like Hotmail, Yahoo! mail, Gmail and Skype.

Click on the screenshots below to see the full videos on WikiLeaks’ site. (Though I should warn that each is temporarily obscured by an obtrusive fundraising pop-up window.)

And check out the complete collection of Gamma’s videos here, along with the rest of the Spy Files here.
http://www.forbes.com/sites/andygree...s-gmail-skype/





EU Moves to Stop Surveillance Tech Sales to Despots
David Meyer

Companies should stop selling surveillance and law enforcement technology to repressive regimes, Europe's digital chief will say on Friday.

In the wake of the Wikileaks 'Spy Files' revelations last week, ZDNet UK understands digital agenda commissioner Neelie Kroes will urge technology firms to come up with a way to avoid "selling despots the tools of their repression", a practice she describes as "to say the least, bad PR".

"Every actor, public and private, must take up their responsibilities," Kroes will tell the Dutch government's Internet Freedom conference on Friday morning. "Companies should be transparent about the technology they are selling in certain countries."

"If technology is used by certain repressive governments to identify innocent citizens and put their life or freedom in danger, we ought to know," Kroes will say, adding that the European Commission "can react with legal measures such as sanctions" in such areas.

The commissioner, who says she is determined to do something about the issue, is working with EU foreign policy chief Catherine Ashton on a response. She said further details about that response would follow on Monday.

Tech industry self-regulation may be the answer, Kroes will say, suggesting the Global Network Initiative as a possible model. The Initiative includes Microsoft, Google and Yahoo as members, and aims to come up with a way for the industry to promote freedom of expression and privacy.

"The industry should come up with concrete solutions," Kroes will say. "I don't want to be prescriptive at this stage. But I do want to see some kind of action. For our part, we are ready to support that process with expertise and operational support."

At this point, it is not clear which countries technology firms will be expected to avoid.

In her speech, Kroes will also call for the EU to develop and distribute technological tools to help people in non-democratic countries shield themselves from surveillance and bypass communications filters.

She will also promote the idea of educating people in such countries about the risks they face when using social networks or other technological forms of communication.

Spy files

At the start of December, Wikileaks began publishing hundreds of documents that it dubbed the Spy Files. The files included catalogues, price lists and other information relating to surveillance software and equipment that Western technology companies are selling to customers that include repressive regimes.

One notable example was Gamma International, a British firm that sold a spyware package called FinFisher to the security forces of former Egyptian president Hosni Mubarak. The tool could be disguised as an update for Apple's iTunes to help it proliferate and spy on the person who had unwittingly installed it.

Others listed in the Spy Files included France's Amesys, which offers products for mass interception of communications.

US secretary of state Hillary Clinton, who in early 2010 warned of an 'information curtain' falling over countries such as China and Tunisia, will also be speaking at Friday's event, as will Google chairman Eric Schmidt.

After the Tunisian regime fell this year, Wikileaks published a cable showing that Microsoft had trained law enforcement officials serving ousted Tunisian president Zine El-Abidine Ben Ali. The company had set up a "program on cyber criminality" to cover the training, in a bid to get the Tunisian government to drop its open-source policy.
http://www.zdnet.co.uk/news/regulati...pots-40094614/





Concern Over DHS Move to Create Giant Information Databank

In an effort to enhance DHS’ information sharing capabilities, the department is looking to construct an integrated database known as the “Federated Information Sharing System,” a move which has raised concerns from the American Civil Liberties Union.

Currently data is restricted to individual systems within various DHS components which were created to fulfill specific mission requirements.

The creation of such a federated system raises a host of privacy issues, so last year DHS’ asked its Privacy and Integrity Advisory Committee, which consists of corporate privacy experts and civil liberties advocates, as well as IT systems experts, to examine the potential consequences of such a policy. In response to the committee’s report, the ACLU recently sent a letter to DHS Secretary Janet Napolitano outlining additional concerns.

Among the issues raised by the ACLU was whether or not the vast amount of information collected by various arms of DHS should be widely accessible.

It noted that the information collected by one agency may be inaccurate or require an institutional understanding of the limitations of particular data, knowledge not held by other components of DHS.

It also gave an example that U.S. Customs and Border Patrol (CBP) claims the right to search and copy the contents of the laptops of immigration attorneys crossing the border. These attorneys likely have clients with cases before the U.S. Customs and Immigration Service and sharing the information gathered by CBP could violate the client’s constitutional rights.

The ACLU also asked Secretary Napolitano what measures would be taken to restrict information on innocent people. DHS currently collects a vast amount of data, including benefit information from the Federal Emergency Management Agency (FEMA), traveler information from CBP and TSA, naturalization records from USCIS, and personal information like social security number, date of birth, and email address from a wide variety of sources.

“Will DHS limit sharing of this information on innocent people or purge it from the system? Just because an ordinary American has had an encounter with DHS does not mean that his or her movements, work history, or other data should be open to widespread scrutiny.”
http://www.homelandsecuritynewswire....ation-databank





Put It on My Marquee: I Just Watched ‘Creepshow 2’
Natasha Singer

IF Netflix has its way, Facebook members in the United States may soon be able to see which of their friends and family members have just video-streamed “Paranormal Activity” or “Boys Don’t Cry.”

Netflix is backing a bill in Congress that would amend the Video Privacy Protection Act, a 1988 law that requires a video services company to get a customer’s written consent when it seeks to disclose that client’s personal information, such as rental history. The new bill, passed by the House last Tuesday, would allow consumers to give one-time blanket consent online for a company to share their viewing habits continuously.

In a social networking ecosystem where sharing information about personal activities is already ubiquitous, the bill may seem to be a no-brainer. After all, Foursquare already shares its members’ locations. Spotify already shares the titles of songs its members are playing with their Facebook cohorts. And Facebook publishes links to articles that its members’ friends have read. So, Netflix executives argue, it’s high time for a bill that would give members of video services the same option to divulge their personal details.

“It really is meant to empower the consumer to be able to share with their friends,” says David Hyman, the general counsel of Netflix. He says the bill simply updates an outmoded law so that it matches the way we live now. “It really kind of levels the playing field in social media.”

But some privacy scholars and advocates are warning that the bill actually diminishes a person’s ability to select what to share — and with whom — on a case-by-case basis. If the Senate passes the bill as currently written, they say, the revised law would undermine consumers’ control over information collected about them even as it empowers companies to create and share more detailed customer profiles. Netflix isn’t lobbying for a mere amendment, they argue; it wants Congress to dismantle a gold standard among privacy statutes.

“They are not trying to modernize the law,” says Marc Rotenberg, executive director of the Electronic Privacy Information Center, a public interest research group in Washington. “They are trying to gut the law.” At stake, he argues, is not the ostensible sharing of a person’s video viewing history, but rather the larger issue of meaningful consent.

The Video Privacy Protection Act came about under unusual circumstances.

In 1987, the Washington City Paper, a weekly newspaper, published the video rental records of Judge Robert H. Bork, who at the time was a nominee to the Supreme Court. One of the paper’s reporters had obtained the records from Potomac Video, a local rental store. Judge Bork’s choice of movies — he rented a number of classic feature films starring Cary Grant — may have seemed innocuous.

But the disclosure of Judge Bork’s cultural consumption so alarmed Congress that it quickly passed a law giving individuals the power to consent to have their records shared. The statute, nicknamed the “Bork law,” also made video services companies liable for damages if they divulged consumers’ records outside the course of ordinary business.

To proponents of the new amendment, the law looks like a relic. Members of social networks today, they say, don’t want to be asked, each time they’ve watched another installment of “The Office,” whether that information can be shared with their friends.

People prefer frictionless sharing, a convenience hindered by the current law, says Christopher Wolf, a lawyer who is co-chairman of the Future of Privacy Forum, a Washington research group that receives financing from Google, Facebook and other digital media companies.

Moreover, Mr. Wolf says, the law restricts video services that seek to integrate with social networks like Facebook even as some music sites have already introduced sharing.

“Companies should not be exposed to hundreds of millions in damages just because particular hoops weren’t jumped through,” he says. “If people can share what they are listening to on Spotify, why shouldn’t they be able to share what videos they are watching?”

Still, video viewing remains a delicate area for many people because movie choices may open a window to a person’s religious or sexual preferences.

“Do you want your conservative friends to know that you watched a hyperviolent “Saw” movie or movies about the gay experience like ‘Brokeback Mountain’?” says Kevin Bankston, a senior staff lawyer at the Electronic Frontier Foundation, a digital civil rights group in San Francisco. “Do you want your liberal friends to know you watch an enormous amount of religious movies?”

Any amendment, he argues, should preserve a person’s ability to choose what to share, case by case, rather than ceding control by giving a general waiver to a company.

“You should have the option to decide what goes on your wall,” he says.

But Netflix argues that the marketplace should dictate consumers’ level of control. Mr. Hyman, Netflix’s general counsel, says the bill lets people opt in to continual sharing by giving their affirmative consent — or to choose not to share at all.

Netflix, he adds, has already introduced a feature for its subscribers in Canada and Latin America who want to share the movies and TV shows they watch with their friends on the video site and on Facebook. Netflix gives these subscribers a choice of opting out of sharing an individual film or show.

“If it is determined that consumers want more control over what they share on a granular basis,” Mr. Hyman says, “you will see that being offered as opposed to it being legislated.”

To advance its agenda, Netflix has increased its presence in Washington. It spent $325,000 on lobbying in the first three quarters of this year, versus $30,000 in the same period in 2009, according to a report from the Center for Responsive Politics, a research group that tracks political spending.

Last week, some legislators complained that proponents of the bill rushed it through the House without a hearing or a full-scale debate. The bill is likely to face tougher scrutiny in the Senate.

Privacy advocates say they expect Senator Al Franken, the Minnesota Democrat who is chairman of the privacy, technology and law subcommittee of the Senate Judiciary Committee, to hold a hearing on the amendment early next year. And the Judiciary Committee, which has often opposed amending laws for the primary benefit of one company, may decide to strengthen the Bork law — by clarifying that it covers online video streaming, not just the old-fashioned rental of physical videos. (Hulu, a streaming video service, has already introduced a sharing option on Facebook.)

In an interview last week, Judge Bork, a distinguished fellow at the Hudson Institute, said he was glad Congress had remedied the unauthorized disclosure of video rental records with a law. But, he added, the amendment seemed to call for further public discussion.

“If you are going to enact change to a statute,” Judge Bork said, “you have to debate the question of whether the costs outweigh the benefits.”
https://www.nytimes.com/2011/12/11/b...r-choices.html





Unlike Oregon, Bloggers Are Journalists in Washington State, Do Qualify for Legal Protections
Curtis Cartier

This morning we told you about the troubling case of Crystal Cox, the Oregon blogger who was successfully sued for defamation, thanks in part to a federal court ruling that she isn't a "journalist" and therefore doesn't qualify for the state's media shield laws. Now, the man who wrote the shield laws in Washington state has weighed in on whether such a ruling would fly here.

Bruce E. H. Johnson, attorney with Davis Wright Tremaine, is a veteran litigator in the field of free speech and media law. In 2006 he drafted Washington state's media shield legislation, and in 2007 the state legislature passed it into law.

He says that had Cox's case been heard in a Washington court, the outcome (at least in regards to the shield law) would have most likely been different.

"I believe the shield law would have been applied [in Washington state]," Johnson tells Seattle Weekly. "Oregon's law was probably written before blogging was accounted for."

Media shield laws exist in 40 U.S. states and protect journalists from being forced to reveal confidential sources in court.

In Oregon the law reads in part as such.

No person connected with, employed by or engaged in any medium of communication to the public shall be required by ... a judicial officer ... to disclose, by subpoena or otherwise ... [t]he source of any published or unpublished information obtained by the person in the course of gathering, receiving or processing information for any medium of communication to the public[.]

Furthermore, Oregon law defines "any medium of communication" as "any newspaper, magazine or other periodical, book, pamphlet, news service, wire service,news or feature syndicate, broadcast station or network, or cable television system."

Notice that nowhere on that list is "website," "blog," "Internet medium," or other such definition.

It was indeed this definition that the federal judge in Oregon cited when he ruled that Cox was not a member of the media and therefore could not benefit from the shield law.

Skip north to Washington and the shield law reads in part like so:

. . . no judicial, legislative, administrative, or other body with the power to issue a subpoena or other compulsory process may compel the news media to testify, produce, or otherwise disclose the identity of a source of any news or information or any information that would tend to identify the source where such source has a reasonable expectation of confidentiality

Washington law further defines "news media" as:

Any newspaper, magazine or other periodical, book publisher, news agency, wire service, radio or television station or network, cable or satellite station or network, or audio or audiovisual production company, or any entity that is in the regular business of news gathering and disseminating news or information to the public by any means, including, but not limited to, print, broadcast, photographic, mechanical, internet, or electronic distribution;

Johnson says that he wrote the shield law shortly after the case O'Grady v. Superior Court was decided in California. In that case, Apple sued a blogger who had published leaked information from the company. The blogger had refused to reveal the source of the leaked information, and after a long, arduous path through the courts, the 6th District U.S. Court ruled that the blogger was in fact a media member and therefore did not have to turn over the information.

"Fortunately we had the O'Grady case to say that bloggers were media when I wrote the law," Johnson says. "Washington's shield law is technologically neutral and it relies on the definition of news media as any news media, including Internet."

As for Cox, Johnson says that even if the court had ruled that she didn't have to reveal her source, she likely still would have had to reveal the source if she wanted to prove her statements were true and therefore weren't defamatory. In other words, the shield law, even if applied, might not have shielded Cox from the $2.5 million judgement she's been ordered to hand over.

At any rate, Cox's plan to keep representing herself without a lawyer isn't doing her case any favors.

To that Johnson recommends she contact the Electronic Frontier Foundation, a San Francisco-based legal group that has been known to represent such cases pro bono.
http://blogs.seattleweekly.com/daily...rs_are_jou.php

















Until next week,

- js.



















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