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Old 13-06-18, 06:14 AM   #1
JackSpratts
 
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Join Date: May 2001
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Default Peer-To-Peer News - The Week In Review - June 16th, ’18

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"Now they can block websites and censor online content." – Jessica Rosenworcel, F.C.C. commissioner (D)


"This isn’t someone in their bedroom." – Tom Keaveny, Middle East managing director beIN Sports






































June 16th, 2018




The Repeal of Net Neutrality Is Official. Here’s How That Could Affect You.
Keith Collins

It’s official. The Federal Communications Commission’s repeal of net neutrality rules, which had required internet service providers to offer equal access to all web content, took effect on Monday.

The rules, enacted by the administration of President Barack Obama in 2015, prohibited internet providers from charging more for certain content or from giving preferential treatment to certain websites.

After the commission voted to repeal the rules in December, it faced a public outcry, legal challenges from state attorneys general and public interest groups, and a push by Democratic lawmakers to overturn the decision. The opponents argued that the repeal would open the door for service providers to censor content online or charge additional fees for better service — something that could hurt small companies — and several states have taken steps to impose the rules on a local level.

Still, the repeal was a big win for Ajit Pai, the F.C.C.’s chairman, who has long opposed the regulations, saying they impeded innovation. He once said they were based on “hypothetical harms and hysterical prophecies of doom.”

These are the rules that were repealed

The original rules laid out a regulatory plan that addressed a rapidly changing internet. Under those regulations, broadband service was considered a utility under Title II of the Communications Act, giving the F.C.C. broad power over internet providers. The rules prohibited these practices:

BLOCKING Internet service providers could not discriminate against any lawful content by blocking websites or apps.

THROTTLING Service providers could not slow the transmission of data because of the nature of the content, as long as it was legal.

PAID PRIORITIZATION Service providers could not create an internet fast lane for companies and consumers who paid premiums, and a slow lane for those who didn’t.

What’s everyone worried about?

Many consumer advocates argued that once the rules were scrapped, broadband providers would begin selling the internet in bundles, not unlike cable television packages. Want access to Facebook and Twitter? Under a bundling system, getting on those sites could require paying for a premium social media package.

Another major concern is that consumers could suffer from pay-to-play deals. Without rules prohibiting paid prioritization, a fast lane could be occupied by big internet and media companies, as well as affluent households, while everyone else would be left on the slow lane.

Some small-business owners are worried, too, that industry giants could pay to get an edge and leave them on an unfair playing field.

E-commerce start-ups have feared that they could end up on the losing end of paid prioritization, with their websites and services loading more slowly than those run by internet behemoths. Remote workers of all kinds, including freelancers and franchisees in the so-called gig economy, could similarly face higher costs to do their jobs from home.

Why it may not matter to you

Several states have taken measures to ensure the rules stay in effect. For example, in March, Gov. Jay Inslee of Washington, a Democrat, signed a law that effectively replaced the federal rules. Others, including the governors of Montana and New York, used executive orders to force net neutrality.

As of late May, 29 state legislatures had introduced bills meant to ensure net neutrality, according to the National Conference of State Legislatures.

Still, several of these measures have failed, some are still pending, and not every state has taken such actions.

The argument against regulation

The F.C.C. said it had repealed the rules because they restrained broadband providers like Verizon and Comcast from experimenting with new business models and investing in new technology. Its chairman has long argued against the rules, pointing out that before they were put into effect in 2015, service providers had not engaged in any of the practices the rules prohibited.

“America’s internet economy became the envy of the world thanks to a market-based approach that began in the mid-1990s,” Mr. Pai said in a speech at the Mobile World Congress in February.

“The United States is simply making a shift from pre-emptive regulation, which foolishly presumes that every last wireless company is an anti-competitive monopolist, to targeted enforcement based on actual market failure or anti-competitive conduct,” he said.

Several internet providers made public pledges that they would not block or throttle sites once the rules were repealed. The companies argued that Title II gave the F.C.C. too much control over their business, and that the regulations made it hard to expand their networks.

The internet was already changed

Perhaps the repeal won’t change the direction of the internet. In November, Farhad Manjoo argued in his New York Times column that the internet had already been dying a slow death, and that the repeal of net neutrality rules would only hasten its demise.

He wrote that the biggest American internet companies — Amazon, Apple, Facebook, Google and Microsoft — controlled much of the online infrastructure, from app stores to operating systems to cloud storage to nearly all of the online ad business.
https://www.nytimes.com/2018/06/11/t...ty-repeal.html





AT&T’s Time Warner Takeover Wins Judge’s Approval in Defeat for Justice Dept.
Cecilia Kang, Edmund Lee and Emily Cochrane

A federal judge on Tuesday approved the blockbuster merger between AT&T and Time Warner, rebuffing the government’s effort to stop the $85.4 billion deal, in a decision that is expected to unleash a wave of corporate takeovers.

The judge, Richard J. Leon of United States District Court in Washington, said the Justice Department had not proved that the telecom company’s acquisition of Time Warner would lead to fewer choices for consumers and higher prices for television and internet services.

The merger would create a media and telecommunications powerhouse, reshaping the landscape of those industries. The combined company would have a library that includes HBO’s hit “Game of Thrones” and channels like CNN, along with vast distribution reach through wireless and satellite television services across the country.

Media executives increasingly say content creation and distribution must be married to survive against technology companies like Amazon and Netflix. Those companies started producing their own shows in just the last several years. But they now spend billions of dollars a year on original programming, and users can stream the video on apps in homes and on mobile devices, putting pressure on traditional media businesses.

Executives and investors of other companies had watched the six-week trial closely for signs about how it might affect their ambitions. Comcast, for example, would like to beat out the Walt Disney Company for some of 21st Century Fox’s assets, but has held off from making a formal bid until the trial ended.

“If there ever were an antitrust case where the parties had a dramatically different assessment of the current state of the relevant market and a fundamentally different vision of its future development, this is the one,” Judge Leon wrote in his opinion.

The ruling is a major setback for the Justice Department and its antitrust chief, Makan Delrahim, whose decision to sue to block the merger broke with convention. Deals such as this one, in which the two companies are in related industries but do not produce competing products, are usually approved by federal regulators.

Mr. Delrahim had insisted that the two companies sell some major parts before getting government approval, a demand that the executives rejected. That led the Justice Department to file its lawsuit in November. Judge Leon’s decision essentially confirmed the conventional thinking about antitrust law.

Mr. Delrahim appeared somber after the decision. He said he was disappointed and would review the 172-page opinion before deciding whether the government would ask a higher court to issue a stay of the ruling. The Justice Department could appeal the decision even if it did not get an injunction.

“I’ve taken an oath to uphold competition,” Mr. Delrahim said. “We are going to take the next steps as necessary.”

Judge Leon took the unusual step of warning the government not to try to seek a stay, saying it would hurt the defendants, which had already gone through an 18-month regulatory and legal battle for their review. The companies face a June 21 deadline to close their deal.

David McAtee, AT&T’s general counsel, said the company was pleased with the opinion and looked forward to giving “consumers video entertainment that is more affordable, mobile and innovative.”

Shares in AT&T fell 2.7 percent in after-hours trading, while shares in Time Warner jumped 4.5 percent.

The deal was hatched in August 2016 when Randall Stephenson, the chief executive of AT&T, called Jeff Bewkes, his counterpart at Time Warner. Mr. Bewkes’s company, with its popular HBO shows, live N.B.A. and N.C.A.A. sports broadcasting rights, and CNN, has been a takeover target for years.

The two then had a long lunch in the Time Warner dining room in New York and agreed that their industries were under siege. The purchase of Time Warner would give AT&T the premium television content it needed to make its bundle of wireless, television and broadband services more attractive to customers.

The deal would put AT&T in charge of Time Warner’s vast portfolio, which includes HBO and CNN, rights to major sports leagues, and valuable film franchises such as Harry Potter. John Stankey, an AT&T executive, would oversee the integration of these units into AT&T and eventually lead the Time Warner business.

“We want people engaged with their mobile devices all day watching movies and video,” Mr. Stephenson testified at the trial.

Presidential politics clouded the merger from almost the moment it was announced. President Trump, while still a candidate, said he would block the deal “because it’s too much concentration of power in the hands of too few.”

Those comments and his repeated criticism of CNN, which is owned by Time Warner’s Turner Broadcasting unit, raised speculation that Mr. Trump had pushed Mr. Delrahim and the Justice Department to block the deal.

But Mr. Delrahim swore to the court that he was not influenced by the White House, and Judge Leon stopped the companies from introducing evidence about possible political interference.

“We always believed that the motivations for bringing this case were questionable at best,” Gary Ginsberg, an executive vice president for Time Warner, said on Tuesday. “The court’s verdict resoundingly supported that view.”

Mr. Delrahim had argued that the only way antitrust concerns could be resolved was through the sale of major businesses. Last fall, he presented AT&T and Time Warner with two options: Sell the majority stake in either DirecTV, which is AT&T’s satellite television company, or Turner Broadcasting. The companies rejected both options.

Mr. Delrahim’s position, which the White House said it supported, also had the backing of some left-leaning politicians and antitrust experts. They have been increasingly calling for the government to break up Silicon Valley giants like Google, Facebook and Amazon and to prevent greater consolidation in health care, media, transportation and agriculture.

Judge Leon, who was appointed by President George W. Bush, tried to limit the reach of his opinion, writing that “the temptation by some to view this decision as being something more than a resolution of this specific case should be resisted by one and all!”

But many antitrust experts and analysts believe the decision will embolden companies to pursue deals.

The decision “will give AT&T market power to raise the price of Time Warner content, and, secondly, it will lead to further vertical mergers in this industry that will harm consumers,” said Steven Salop, an economics and law professor at Georgetown University who has pushed for stronger government regulation.

The trial drew large crowds that included executives, hedge fund managers and financial analysts. Mr. Delrahim attended occasionally, and so did Mr. Stephenson and Mr. Bewkes. The two executives each took the witness stand to defend the merger.

Judge Leon asked few questions during the trial and gave little indication of where he was leaning before his opinion on Tuesday. But many experts felt that the government had struggled to make its case.

After Judge Leon delivered his decision to a packed courtroom, representatives from AT&T and Time Warner lined the small hallway just outside. The men and women embraced and clapped one another on the back, beaming as they whispered congratulations.

“It’s a receiving line,” one woman joked, her hands outstretched for the next hug.

Cecilia Kang and Emily Cochrane reported from Washington, and Edmund Lee from New York.
https://www.nytimes.com/2018/06/12/b...rust-case.html





Next Year, People Will Spend More Time Online than they Will Watching TV. That’s a First.

It’s happening faster than expected.
Rani Molla

It’s finally happening: Next year, people around the world will spend more time online than they do watching TV, according to new data from measurement company Zenith.

In 2019, people are expected to spend an average of 170.6 minutes each day on online activities like watching videos on YouTube, sharing photos on Facebook and shopping on Amazon. They’ll spend slightly less time — 170.3 minutes —watching TV.

The global transition from TV to internet as the main entertainment medium was a long time coming, but it also happened faster than expected. Last year, Zenith predicted that TV would still be more popular in 2019 but has since revised its estimates.

Advertisers, for once, are ahead of the curve. Globally, they’re expected to spend $60 billion more on internet than TV advertising in 2019.

Lower-priced smartphones have accelerated internet adoption by quickly bringing the developing world online. Mobile will be responsible for all growth in internet consumption and more than a quarter of all media consumption — that includes time spent watching movies in theaters, listening to the radio and reading physical newspapers and magazines — next year.

The total time we spend on media activities is still growing as more offline activities (talking with friends in person) become online activities (chatting on social media). Altogether it’s expected to grow to 486.5 minutes per day next year, up from 479 this year.

In the U.S., however, TV is still king. Internet usage will not eclipse TV viewing there until 2020, according to Zenith.
https://www.recode.net/2018/6/8/1744...ith-data-media





Pirating TV Just Got a Lot Harder
Matthew Dunn

ENDING piracy for good has long seemed like a never-ending game of cat and mouse.

As soon as an infringing website is shut down, four or five mirror sites instantly appear in its place.

Google investigates take-down requests and removes an infringing website if it's found to be soliciting piracy - and so far the number of removed web addresses has reached 3.5 billion.

But now the search engine has ramped up its efforts to put an end to piracy, by blocking web addresses before they even appear in search results.

The fresh approach began earlier this year when Google copyright lawyer Caleb Donaldson announced the company had started to block non-indexed links pre-emptively.

"Google has critically expanded notice and take-down in another important way: We accept notices for URLs that are not even in our index in the first place. That way, we can collect information even about pages and domains we have not yet crawled," he wrote in intellectual property law journal Landslide.

"We process these URLs as we do the others. Once one of these not-in-index URLs is approved for take-down, we prophylactically block it from appearing in our search results."

Mr Donaldson added that artificial intelligence would help Google ensure piracy websites remained hidden from the public eye.

"As we move into a world where artificial intelligence can learn from vast troves of data like these, we will only get better at using the information to better fight against piracy," he said.

While Google has been actively blocking non-indexed links for a number of months, the tech giant hadn't offered up information on how many copyright-infringing URLs were removed without even appearing on the search engine.

This all changed last week with a new update in Google's transparency report showing which URLs had been put on a blacklist to prevent them from being added in the future.

The report shows companies such as Fox, Walt Disney and NBC Universal were all involved in flagging URLs, however anti-piracy group APDIF is the most active with more than 90 per cent of its take-down requests appearing to be non-indexed links.

While it's not flawless, Google seems certain the move will greatly diminish access to illegal piracy websites.

THE OTHER PIRACY PROBLEM

Taking a proactive approach to blocking piracy sites will make it harder for users to illegally download their favourite films and shows for free, but there is another risk rights holders face.

People are now using plug-and-play set-top boxes to stream an array of subscription channels using third-party applications.

Creative Content Australia executive director Lori Flekser told news.com.au last month that users were stealing TV subscription service signals being delivered to a legitimate subscribers and copying them over to the open-source media player.

"With these devices, users can install a range of third-party add-ons … to access copyright-protected media from across the globe for free," she said.

"Each app looks perfectly legal, like a Netflix platform where you've got a range of content options for everything from TV to movies to sports … and it does look legitimate."

Ms Flekser said research had shown more than one in five Australians were using an illegal pirated app on their media players, with younger Australians the main culprits.

"About a third of teenagers are watching TV through a set-top box device, and about a quarter are using an infringing app," she said.

But for people using this method, things are about to get much harder.

In late April, a ruling in the Federal Court granted Village Roadshow and six Hollywood studios an injunction to block 16 internet addresses that provided this service.

Ms Flekser said the move to stop this marked a significant step forward for the screen industry.

"The Federal Court is realising piracy is more than just The Pirate Bay and 123FreeMovies," she said.

"There are now more tech-savvy ways to access illegal material, and set-top boxes are a way in. It's great the court has recognised that this goes beyond just websites.

"I think it will be interesting for consumers subscribed to soon-to-be blocked services. It's an expensive paperweight, because it doesn't provide them what they paid for, and forces them into this 'buyer beware' situation. Legal services can't just cut you off, but illegal services can."

Ms Flekser added that people were always going to find ways to avoid paying for content, but these court initiatives were a good reminder to pay for movies and TV shows legally.

"We know from our research that if we make it harder for people to find content legally, they'll go straight to The Pirate Bay. Addressing that is the next step," she said.

And this is where Google hopes to come into play.
https://www.sunshinecoastdaily.com.a...n-mak/3439150/





In Saudi Arabia, a Pirate TV Network Provides a World Cup Lifeline
Matt Bonesteel

Saudi Arabia’s national soccer team will take the field at the World Cup for the first time in 12 years Thursday, opening the tournament with a match against host Russia in Moscow that will be watched by hundreds of millions around the world.

The millions of Saudi Arabians watching at home, meanwhile, will be doing so illegally thanks to a dispute with neighboring Qatar that has been simmering for more than 150 years but has reached its boiling point over the past year.

The World Cup is here. Want smart analysis, opinions, viewing guides and more? Sign up for our month-long newsletter. Every match day through the final July 15.

On the surface, the feud between Qatar, a peninsular nation that juts into the Persian Gulf, and Saudi Arabia, the United Arab Emirates, Bahrain and Egypt centers on Qatar’s support for Islamist revolutionaries in Egypt, Tunisia, Libya and Syria during the Arab Spring uprisings earlier this decade. In response, its four opponents — fearing that such political movements could threaten their long-held dynastic monarchies — began boycotting Qatar, closing airspace to the country’s national airline, restricting travel and, according to the New York Times, expelling 12,000 Qatari camel that were grazing on Saudi land.

The boycotting countries also banned broadcasts by Al Jazeera, the Qatari news network that often airs unflattering and critical stories about the region’s other ruling families. This is where the World Cup comes into play: Al Jazeera owns beIN Sports, which owns the right to air tournament games in the Middle East. Without that network, the boycotting countries would be unable to watch soccer’s quadrennial celebration.

Or, at least that was the thinking. Faced with the prospect of missing its team’s matches, someone in Saudi Arabia created a pirate cable network with the nose-thumbing name of beoutQ and began selling cable boxes that gave Saudis access to 10 channels, one of them pirating beIN Sports’s feed. They’ve been on sale for months, with a one-year subscription costing $100, the Times reports.

It’s a sophisticated operation, suggesting both great technical know-how and significant financial backing. BeoutQ superimposes its logo over the beIN Sports logo during its sports broadcasts. Officials at beIN Sports told the Times they tracked the beoutQ signal to the Riyadh-based satellite provider Arabsat, which is majority owned by Saudi Arabia. (No one has claimed responsibility.)

Tom Keaveny, beIN’s managing director for the Middle East, told the Times last month that the operation “takes industrial scale knowledge and ability and multimillion dollar funding.”

“This isn’t someone in their bedroom,” he added.

BeIN Sports — which before the boycott had more than 900,000 subscribers in Saudi Arabia, its largest market — has every right to be angry, considering the billions it has paid for the rights to air World Cup games. Now someone is stealing that content, and brazenly so. The Qatari network has spent thousands of dollars trying to shut down beoutQ, with no success. A FIFA-brokered deal in which Saudi Arabia would pay Qatar $35 million for the right to legally air 22 matches, including all of the games featuring the national team, fell apart earlier this month, with Saudi sports authority chief Turki Al Alshikh accusing the Qataris of backtracking on the agreement and the Qataris claiming the price never was agreed upon, according to Bloomberg.

Egypt, whose team is back in the World Cup after a long absence (28 years), also is part of the Qatar blockade and may follow a similarly brazen path. On Monday, according to Variety, the Egyptian Competition Authority said its nation’s consumers have “a right” to see the games, urged FIFA to “make them available” and promised to steal beIN Sports’s feed to 22 matches to air them on Egyptian public television. The United Arab Emirates, meanwhile, was able to broker a deal with beIN Sports.
https://www.washingtonpost.com/news/...-cup-lifeline/





Top 10 Pirated Movies From Last Week
Chris Lange

Pirating movies has been a growing problem in recent years, costing studios millions of dollars in lost ticket sales. For example, in 2016 the Motion Picture Association of America says that nearly $1 billion worth of pirated movies and TV shows were downloaded.

It goes without saying that online streaming has been a growing trend as well. Netflix has led the charge, with Hulu, HBO and others also capitalizing on the trend. While these are the legitimate channels, online pirates subvert them to dodge subscription fees.

“Game of Thrones” is a wildly popular HBO series that was the target of hackers and pirates in 2017 and much of the season was leaked online, whether it was plot points or actual episodes. Hackers even tried to press HBO to pay a ransom for the material but ultimately released it anyway.

One of the more popular mediums for downloading and watching content is BitTorrent, which operates as a peer-to-peer file-sharing service. It is capable of distributing a massive amount of data over the internet.

Although it is widely known that many files are shared and downloaded illegally over this service, it still manages to operate. Authorities use the site as well to track some users who don’t hide their IP addresses via a proxy and nab them for illegally distributing or downloading content.

24/7 Wall St. has taken a look at some of the more popular movies that were pirated this past week. These are the top 10 most pirated movies of the past week on BitTorrent:

1. Tomb Raider
2. Pacific Rim: Uprising
3. Avengers: Infinity War
4. Love, Simon
5. 211
6. A Quiet Place
7. Black Panther
8. Sherlock Gnomes
9. Red Sparrow
10. Deadpool 2

https://247wallst.com/media/2018/06/...rom-last-week/





This App in Google Play Wants to Use Phone Mics to Enforce Copyrights

App with 10 million downloads asks for mic and GPS permissions to catch scofflaws.
Dan Goodin

If ever there were a case for rejecting requested device permissions, it’s made by an Android app with more than 10 million downloads from Google Play. The official app for the Spanish soccer league La Liga was recently updated to seek access to users’ microphone and GPS settings. When granted, the app processes audio snippets in an attempt to identify public venues that broadcast soccer games without a license.

According to a statement issued by La Liga officials, the functionality was added last Friday and is enabled only after users click “yes” to an Android dialog asking if the app can access the mic and geolocation of the device. The statement says the audio is used solely to identify establishments that broadcast games without a license and that the app takes special precautions to prevent it from spying on end users.

According to the statement, which was translated by Google:

La Liga has implemented appropriate technical measures to protect the user's privacy if you authorize us to use this functionality. Here are the following measures:

• La Liga will only activate the microphone and geolocation of the mobile device during the time slots of matches in which La Liga teams compete.
• La Liga does not access the audio fragments captured by the microphone of the device, since these are automatically converted into a binary code on the device itself. La Liga only has access to this binary code, which is irreversible and does not allow to obtain audio recording again.
• If this code matches a previous control code, LaLiga will know that you are watching a particular match. If it does not match, the code is deleted.
• The codes will not refer to your name, but to your IP address and the specific ID assigned by the APP when the user registers.
• We will periodically remind you that LaLiga can activate your microphone and geolocation and we will ask you to confirm your consent.
• You may revoke your consent at any time in the settings of the mobile device.

Without more details and a technical analysis of the app, it’s hard to evaluate the claims about collected audio being converted to a binary format that can’t be converted back into sound. That alone should be enough reason for users to reject this permission.

But even if the app uses a cryptographic hash or some other means to ensure that stored or transmitted audio fragments can’t be abused by company insiders or hackers (a major hypothetical), there are reasons users should reject this permission. For one, allowing an app to collect the IP address, unique app ID, binary representation of audio, and the time that the audio was converted could provide a fair amount of information over time about a user. For another, end users frequenting local bars and restaurants shouldn’t be put in the position of policing the copyrights of sports leagues, particularly with an app that uses processed audio from their omnipresent phone.

A Google spokesman didn’t have a comment on the app other than to refer to this policy, which is binding on all apps available in the Play marketplace. Among other things, the policy requires that apps prominently disclose any collection of personal or sensitive user data. Such apps must also present a consent dialog in a “clear and unambiguous way.” The policy also bars deceptive behavior.

If the La Liga app does what league officials say, it’s probably complying with Google terms. Fortunately, those terms require that the app provides a consent dialogue. That puts the onus on users to choose “no.”
https://arstechnica.com/information-...ce-copyrights/





BitTorrent Sells to Blockchain Entrepreneur Justin Sun
Janko Roettgers

File-sharing pioneer BitTorrent Inc. has been sold to Justin Sun, a blockchain entrepreneur best known for the Tron platform and its TRX cryptocurrency. The acquisition closed last week and staff has been notified of the deal, Variety has learned. Company representatives and Sun didn’t respond to repeated requests for comment.

Word about a possible acquisition of BitTorrent first got out last month, when TorrentFreak reported that Sun was pursuing the company. Sun first started talking to BitTorrent in September of last year, and signed a letter of intent to acquire it in January. The deal was briefly held up when BitTorrent started talking to additional bidders, which led to Sun filing for a temporary restraining order, arguing that BitTorrent agreed to not pursue any other offers.

However, Sun ultimately dropped its lawsuit, and proceeded to register a company called Rainberry Acquisition Inc. Coincidentally, BitTorrent had renamed its corporate entity to Rainberry Inc. at the beginning of last year.

Last week, Sun’s Rainberry Acquisition filed a change of status with the California Secretary of State due to a merger. Rainberry Inc., the company that owns BitTorrent, also filed for a merger on the very same day, strongly suggesting that the two companies had merged.

Variety has now learned that Sun has indeed acquired BitTorrent, with BitTorrent management informing staff about the deal last week. However, staffers have been advised not to talk to the press, according to a source with knowledge of the transaction. Some of the company’s shareholders have also since been contacted by the transfer agent hired for the deal.

Financial details about the acquisition weren’t immediately available, but Sun does have enough pocket change to pick up BitTorrent and its assets. The total market cap of his TRX cryptocurrency is currently around $4.78 billion, $1.65 billion of which are being held by Sun’s Tron Foundation.

The foundation claims that it wants to build what it calls a “decentralized internet,” allowing developers to build blockchain-based applications. It’s unclear how exactly Tron plans to integrate with BitTorrent.

The deal is just the latest in a long and tumultuous corporate history for BitTorrent. The company raised millions a decade ago to build an entertainment business on top of its P2P. Those plans failed and BitTorrent was forced to lay off much of its staff, and recapitalize, in 2008. In the following years, BitTorrent proceeded to grow its business through ads and bundled software, at one point reaching 150 million monthly active users.

In 2016, two outside investors acquired one of the original investor’s stake in the company. Those investors not only got seats on BitTorrent’s board, but also briefly became co-CEOs of the company and spearheaded an expensive expansion into the media space, including the opening of a Los Angeles production facility. Those efforts ultimately faltered; both CEOs were fired that same year, and the company shut down its L.A. studio space and effectively shuttered its media operations.

BitTorrent also proceeded to shut down its live streaming business last year. Some of the core technology for BitTorrent Live had been developed by BitTorrent founder Bram Cohen, who has since moved on from the company. Cohen is now CEO of Chia, a cryptocurrency company with no relations to Sun’s Tron.
https://variety.com/2018/digital/new...un-1202841793/





Apple to Close iPhone Security Hole That Police Use to Crack Devices
Jack Nicas

Apple has long positioned the iPhone as a secure device that only its owner can open. That has led to battles with law enforcement officials who want to get information off them, including a well-publicized showdown with the F.B.I. in 2016 after Apple refused to help open the locked iPhone of a mass killer.

The F.B.I. eventually paid a third party to get into the phone, circumventing the need for Apple’s help. Since then, law enforcement agencies across the country have increasingly employed that strategy to get into locked iPhones they hope will hold the key to cracking cases.

Now Apple is closing the technological loophole that let authorities hack into iPhones, angering police and other officials and reigniting a debate over whether the government has a right to get into the personal devices that are at the center of modern life.

Apple said it was planning an iPhone software update that would effectively disable the phone’s charging and data port — the opening where users plug in headphones, power cables and adapters — an hour after the phone is locked. While a phone can still be charged, a person would first need to enter the phone’s password to transfer data to or from the device using the port.

Such a change would hinder law enforcement officials, who have typically been opening locked iPhones by connecting another device running special software to the port, often days or even months after the smartphone was last unlocked. News of Apple’s planned software update has begun spreading through security blogs and law enforcement circles — and many in investigative agencies are infuriated.

“If we go back to the situation where we again don’t have access, now we know directly all the evidence we’ve lost and all the kids we can’t put into a position of safety,” said Chuck Cohen, who leads an Indiana State Police task force on internet crimes against children. The Indiana State Police said it unlocked 96 iPhones for various cases this year, each time with a warrant, using a $15,000 device it bought in March from a company called Grayshift.

But privacy advocates said Apple would be right to fix a security flaw that has become easier and cheaper to exploit. “This is a really big vulnerability in Apple’s phones,” said Matthew D. Green, a professor of cryptography at Johns Hopkins University. A Grayshift device sitting on a desk at a police station, he said, “could very easily leak out into the world.”

In an email, an Apple spokesman, Fred Sainz, said the company is constantly strengthening security protections and fixes any vulnerability it finds in its phones, partly because criminals could also exploit the same flaws that law enforcement agencies use. “We have the greatest respect for law enforcement, and we don’t design our security improvements to frustrate their efforts to do their jobs,” he said.

Apple and Google, which make the software in nearly all of the world’s smartphones, began encrypting their mobile software by default in 2014. Encryption scrambles data to make it unreadable until accessed with a special key, often a password. That frustrated police and prosecutors who could not pull data from smartphones, even with a warrant.

The friction came into public view after the F.B.I. could not access the iPhone of a gunman who, along with his wife, killed 14 people in San Bernardino, Calif., in late 2015. A federal judge ordered Apple to figure out how to open the phone, prompting Timothy D. Cook, Apple’s chief executive, to respond with a blistering 1,100-word letter that said the company refused to compromise its users’ privacy. “The implications of the government’s demands are chilling,” he wrote.

The two sides fought in court for a month. Then the F.B.I. abruptly announced that it had found an undisclosed group to get into the phone, paying at least $1.3 million because the hacking techniques were not common then. An inspector general’s report this year suggested the F.B.I. should have exhausted more options before it took Apple to court.

Since then, two main companies have helped law enforcement hack into iPhones: Cellebrite, an Israeli forensics firm purchased by Japan’s Sun Corporation in 2006, and Grayshift, which was founded by a former Apple engineer in 2016. Law enforcement officials said they generally send iPhones to Cellebrite to unlock, with each phone costing several thousand dollars to open. In March, Grayshift began selling a $15,000 GrayKey device that the police can use to unlock iPhones themselves.

Apple has closed loopholes in the past. For years, the police used software to break into phones by simply trying every possible passcode. Apple blocked that technique in 2010 by disabling iPhones after a certain number of incorrect attempts. But the Grayshift and Cellebrite software appear to be able to disable that Apple technology, allowing their devices to test thousands of passcodes, Mr. Green said.

Cellebrite declined to comment. Grayshift did not respond to requests for comment.

Opening locked iPhones through these methods has become more common, law enforcement officials said. Federal authorities, as well as large state and local police departments, typically have access to the tools, while smaller local agencies enlist the state or federal authorities to help on high-profile cases, they said.

Law enforcement agencies that have purchased a GrayKey device include the Drug Enforcement Administration, which bought an advanced model this year for $30,000, according to public records. Maryland’s state police have one, as do police departments in Portland, Ore., and Rochester, Minn., according to records.

Hillar Moore, the district attorney in Baton Rouge, La., said his office had paid Cellebrite thousands of dollars to unlock iPhones in five cases since 2017, including an investigation into the hazing-related death of a fraternity pledge at Louisiana State University. He said the phones had yielded crucial information, and he was upset that Apple planned to close such a useful investigative avenue.

“They are blatantly protecting criminal activity, and only under the guise of privacy for their clients,” he said.

Michael Sachs, an assistant district attorney in Manhattan, said his office uses workarounds — he declined to specify which — to access locked iPhones several times a week. That has helped solve a series of cases in recent months, including by getting into an iPhone to find videos of a suspect sexually assaulting a child. The man was convicted this year.

In the first 10 months of 2017, the Manhattan district attorney’s office said it had recovered and obtained warrants or consent to search 702 locked smartphones, two-thirds of which were iPhones. Smartphones running Google’s Android software have been generally easier to access, partly because many older devices lack encryption.

The encryption on smartphones applies only to data stored solely on the phone. Companies like Apple and Google regularly give law enforcement officials access to the data that consumers back up on their servers, such as via Apple’s iCloud service. Apple said that since 2013, it has responded to more than 55,000 requests from the United States government seeking information about more than 208,000 devices, accounts or financial identifiers.

The tussle over encrypted iPhones and opening them to help law enforcement is unlikely to simmer down. Federal officials have renewed a push for legislation that would require tech companies like Apple to provide the police with a backdoor into phones, though they were recently found to be overstating the number of devices they could not access.

Apple probably won’t make it any easier for the police if not forced by Congress, given that it has made the privacy and security of iPhones a central selling point. But the company has complied with local laws that conflict with its privacy push. In China, for instance, Apple recently began storing its Chinese customers’ data on Chinese-run servers because of a new law there.

Apple’s latest move is part of a longer cat-and-mouse game between tech companies and law enforcement, said Michelle Richardson, an analyst at the Center for Democracy and Technology, which supports protections for online privacy.

“People always expected there would be this back-and-forth — that government would be able to hack into these devices, and then Apple would plug the hole and hackers would find another way in,” she said.
https://www.nytimes.com/2018/06/13/t...ne-police.html





Underpaid and Exhausted: the Human Cost of Your Kindle

In the Chinese city of Hengyang, we find a fatigued, disposable workforce assembling gadgets for Amazon, owned by the world’s richest man.
Gethin Chamberlain

Five o’clock in the morning and the young woman’s eyelids are drooping. All night she has been removing spots of dust from Amazon smartspeakers with a toothbrush. Time seems to crawl. Now she is overwhelmed with exhaustion.

She works on, more and more slowly, until she can do no more. She looks around the workshop. Other workers have rested their heads on the bench. She slumps forward and falls asleep.

Let’s call the young woman Alexa. Alexa, what are you doing here?

For an answer, we must fast forward a couple of months to last Monday. It is an overcast morning in the city of Hengyang, in the southern Chinese province of Hunan. More than seven million people live in this city, the second-largest in the province. It is known locally as the Wild Goose City, for the birds that used to stop off on their southerly migration, but many people even within China would struggle to find it on a map.

The morning is warm but overcast, with a light haze that could be fog or pollution. The road to the Foxconn factory in Baishazhou Industrial Park is wide and lined with well-cared-for plants. There’s a steady stream of cars, motorbikes and buses heading towards the factory, which sits back from the road behind a large gate. Blue-uniformed security staff keep watch on those coming in and the street outside.

Dozens of workers are arriving, casually dressed in jeans and T-shirts. Most are young and there is a good mixture of women and men. Ahead of them lies a 60-hour week, eight regular hours for five days, plus two more of overtime each day and another 10 on Saturday. They will be expected to hit tough targets and must ask permission to use the toilets. The overtime – up to 80 hours a month – is far in excess of the 36 hours stipulated in Chinese labour laws, but companies can and do seek exemptions and workers want the overtime, to boost their basic pay.

These are the people who are making the smart speakers and tablets that Amazon hopes to make a fixture in millions more homes around the world this year: the Echo and Echo Dot – which both spring to life when the user addresses them as Alexa – and the Kindles.

It is a year since Amazon sealed a deal with the giant Foxconn company to ramp up its hardware production in Hengyang, with the Chinese firm reportedly adding 30 new production lines and creating 15,000 jobs.

Foxconn is China’s largest single private employer, and in March it reported a 4.2% increase in profits, with net income rising to £1.84bn in the last three quarters of 2017. Profits for the first quarter of this year were £605m and its CEO, Terry Gou, has a fortune reported to be about £5.3bn. But it is said to be keen to diversify to reduce its reliance on Apple and it is investing heavily in the Hengyang plant to meet the demand from Amazon.

The Foxconn factory in Hengyang relies on the tried and tested formula of low wages and long hours. But here there is another element: the extensive use of agency workers who don’t have the security of a regular job.

These employees – known as dispatch workers in China – are hired in from labour companies as an off-the-shelf workforce. They are generally slightly better-paid than permanent members of staff, but they get no sick pay or holiday pay and can be laid off without any pay at all during quiet months when production drops off. In some ways they resemble the Amazon products they are making: wanted one day and discarded the next.

But the increasing reliance on a disposable workforce by companies has alarmed the Chinese government, and in 2014 it changed its labour laws to limit dispatch workers to just 10% of a company’s staff – and then only to cover temporary work. Companies were expected to fill most positions with regular staff on employment contracts.

The wage slips pinned to the walls of the Foxconn factory in Hengyang suggest that the message may be taking some time to get through: they show that about 40% of the workforce in the Hengyang plant are bought in from agencies. These are the workers on whom Amazon CEO Jeff Bezos is relying to further entrench his position as the world’s richest man.

Bezos is worth an estimated £102bn, a fortune he acquired against a backdrop of global reports of misery for Amazon’s warehouse workers, exhausted by the demands made on them in return for the most basic of wages. Unions and labour rightsgroups have protested about low pay and harsh working conditions, and three delivery firms used by Amazon are facing a legal challenge from the GMB union, demanding that gig economy delivery drivers receive sick pay and holiday pay.

Last month it was revealed that ambulances had been called 600 times to Amazon’s UK warehouses over the past three years. There have been repeated calls for Amazon to improve the lot of its workers.

But Bezos doesn’t see the need. Collecting an award for “outstanding personalities who are particularly innovative, and who generate and change markets, influence culture and at the same time face up to their responsibility to society” a couple of months ago, he was questioned about the controversies surrounding the way he made his money.

“When you’re criticised,” he said, “first look in the mirror and decide: are your critics right? If they are right, change. Don’t resist.”

But Bezos’s mirror apparently showed him that his critics were wrong. “I’m very proud of our working conditions and very proud of the wages we pay,” he told the audience gathered to fete him.

And now he and Gou have brought that same formula to Hengyang. But what draws two of the world’s richest men to set up in a city far from the big manufacturing hubs of Shenzhen, Shanghai, Tianjin and Guangzhou, with their easy access to shipping and huge industrial bases?

For an answer, it helps to know that Alexa is working for 14.5 yuan an hour (£1.69). That’s £1 less than the £2.69 national average for a factory worker in China. Foxconn could not pay her so little in Shenzhen, where the legal minimum wage is 19.5 yuan an hour, or in Shanghai, where it is 20 yuan.

Some days Alexa gets to work overtime. But when she opens her wage slip at the end of the month she will be disappointed, because she and her fellow dispatch workers are paid only the same 14.5 yuan rate that they get for the main shift, instead of the time-and-a-half stipulated by Chinese labour law and Amazon’s own supplier code of conduct.

Foxconn promises agency workers a minimum of 3,700 yuan a month (£431.64), but pay slips and workers’ own accounts suggest real wages rarely get close to that figure. Most earn between 2,000 and 3,000 yuan, with permanent staff earning between 2,000 and 2,500 yuan. In 2017, the average wage for a worker in Hengyang was 4,647 yuan a month.

Pay rates have rocketed in China in recent years, but Hunan remains one of the provinces with the lowest wages, and the minimum in Hengyang – 1,280 yuan a month – is barely half that in Shenzhen, where Foxconn’s Apple factory is based.

That Shenzhen factory has been the subject of years of criticism for its treatment of staff manufacturing iPhones and other Apple devices – with 14 suicides in 2010 prompting the installation of netting around the factory dormitories to catch workers jumping from the roofs.

Now rewind again, back to March. It is early evening and Alexa is getting off the bus and entering the factory for the night shift. She has secured a job as a dispatch worker through the Qizhong labour company – one of six supplying the factory – and has joined the production line making Amazon’s mini smart speaker, the Echo Dot.

Alexa looks much like the other young women around her, but she has a secret. Alexa has been sent in undercover by the US-based labour rights investigator China Labor Watch to find out what is going on behind the security gate. It is the first time anyone has investigated Amazon’s production lines, and CLW has teamed up with the Observer (and the Sunday Mirror) to publish the findings. Its own report – Amazon Profits from Secretly Oppressing its Supplier’s Workers – is published online today.

Alexa is early, like all the other workers. They know that they must leave time to clear security and be at their workstations for the 8pm start, though they won’t be paid for turning up early. She notices that the temperature inside the workshops is noticeably higher than outside and the anti-static gloves she has to wear quickly make her hands sweat.

Every day when she returns to the company dormitory she shares with five other women, she jots down what she has seen in her diary: the monotonous work; the colleagues complaining about sore backs and the bright lights that make their eyes tired; the overwhelming sense of exhaustion. She notes that workers must ask permission from a supervisor to go to the toilet, and how some workers are left in tears when they are told off by their line manager.

Today Alexa has to clean 1,400 Echo Dot speakers with a toothbrush dipped in rubbing alcohol to remove any specks of dust. Four-and-a-half hours into the shift, she is already flagging.

“I was already so tired and my movements grew slower,” she writes later. “I brushed with less and less force. There were 20 or 30 speakers building up in front of me that I had yet to brush clean.

“The speakers that remained to be cleaned kept building up in front of me. The line technician came over and told me to brush faster and that my movements were too slow … but I no longer had any strength.”

Another day she chats to an older woman sitting opposite her.

“The woman across from me said that she had been brushing for so long that her hand was growing numb, her neck was sore, her back was sore, her eyes couldn’t see clearly, and her vision was getting worse …”

Another worker tells her she, too, is suffering: “While working at the same work position and doing the same motions over and over again each day, she felt exhausted and her back was sore and her neck, back and arms could barely take it any more.”

Alexa’s diary makes no happier reading the following day. A woman of about 45 tells her how she has been scolded because she is not fast enough: “It might be because she was getting older so her speed was slower and her reactions were slower. When the line leader was telling her off, she started crying. After I returned to the dorm, an older woman … said that last time the line leader told her off, she also cried.”

She describes long nights of repetitive and relentless work, with fellow workers close to falling asleep on their feet. During a break about midnight she sees that “many people were resting on the assembly line and sleeping, while others had pushed together some chairs and were sleeping on those. Some had even stacked together some foam boards and slept on top of them.”

She finds little relief on returning to the dormitories, where she notes that there is no emergency escape plan in case of fire and “escape routes are unlabelled”. Workers complain about the living conditions, including leaks in the roof and lights in the showers not working.

Alexa’s diary records her own frustrations on the production line and how she is overwhelmed by tiredness: “In my mind, I was both furious and lamenting as my hands continued the repetitive motions. My hands started feeling sore, but I managed to make it to 3am.

“Around 4am, the workers across from me stopped working. I continued observing. The workers across from me told me I didn’t need to watch any more as the quota had already been reached. At this time, I saw that some of the people in the work positions behind us had also stopped and were sitting due to lack of work. I felt very tired so I rested my head on the assembly line. After a while, the line technician came over and tapped me and said I couldn’t sleep on the assembly line, so I sat up again.”

At the end of the shift, Alexa leaves the workshop and goes to collect her phone from her locker: “There were a lot of people squatting or sitting on the kerbside, eating a boxed lunch or playing with their phones. They all looked exhausted.”

Talk in the factory is of agency workers being laid off without pay during quiet periods: 700 in April and May, and 2,700 in January and February. Yet among the workers there is no great simmering anger, no burning resentment. Few have heard of Amazon or Bezos. They aren’t expecting very much and aren’t particularly disappointed when not very much is exactly what Foxconn and Amazon give them.

One 32-year-old married man says he can earn a basic 2,000 yuan (£233) a month making Kindles, but even with overtime taking it up to around £315 it is not enough.

“Currently, the wages are very low. I hope to be able to earn around 3,000 to 5,000 yuan a month. Though I doubt I can earn this on a consistent basis.” At least it is better than being a dispatch worker, he says. “The factory just fires them.”

But a 19-year-old dispatch worker disagrees. He says he can earn 145 yuan a day if he works a couple of hours’ overtime and just accepts it when he is laid off: “The factory will schedule holidays for dispatch workers. Around half a month to a month. I just stay at home. It is OK.”

It’s really not OK though, says Li Qiang, CLW’s executive director. Last month he wrote to Bezos, setting out the investigation’s findings and challenging the hiring of more than 40% of the workforce from agencies.

“This violates Chinese labour law. Foxconn uses a large number of dispatch workers and violates workers’ interests via these dispatch companies. This practice is unethical and illegal,” he wrote.

“I hope that you can compel your suppliers to improve their working situations and to manufacture Amazon products under ethical conditions.”

But Amazon already knew this, because Alexa was not the only person running a ruler over the Foxconn factory in March. Amazon says that its own auditors also visited, and picked up “two issues of concern” – the high volume of dispatch workers and the illegal underpayment of overtime. Foxconn was told to fix it.

Kara Hartnett Hurst, Amazon’s head of worldwide sustainability, responded to Li Qiang’s concerns, telling him: “Amazon takes reported violations of our supplier code of conduct extremely seriously. Amazon recognises our responsibility to ensure the wellbeing of factory workers manufacturing products for Amazon.”

The company had, she said, a code of conduct for suppliers and it used independent auditors to inspect its suppliers, who were expected to respond to any issues identified.

Last year, Bezos announced that he was considering a philanthropy strategy, “helping people in the here and now – short term – at the intersection of urgent need and lasting impact”.

Apparently short of inspiration and unable to think of anything close to home, he took to Twitter to ask for suggestions. Today’s report suggests he might have been better off just asking Alexa.
https://www.theguardian.com/technolo...onn-jeff-bezos





Near-Collapse of ZTE May Be China’s Sputnik Moment
Li Yuan

Once derided as a technology backwater and copycat, China is justifiably proud of its technology boom. Its people zip around the country on high-speed trains. They can buy, and pay for, just about anything with their smartphones. For Chinese traveling abroad, the rest of the world can seem slow and antiquated.

Now, that progress has been cast into doubt, and even some of the smartest people in the technology world are asking how they got it so wrong.

The Trump administration gave ZTE, which employs 75,000 people and is the world’s No. 4 maker of telecom gear, a stay of execution on Thursday. ZTE, which had violated American sanctions, agreed to pay a $1 billion fine and to allow monitors to set up shop in its headquarters. In return, the company — once a symbol of China’s progress and engineering know-how — will be allowed to buy the American-made microchips, software and other tools it needs to survive.

China’s technology boom, it turns out, has been largely built on top of Western technology.

The ZTE incident, as it is called in China, may be the country’s Sputnik moment. Like the United States in 1957, watching helplessly as the Soviet Union launched the first human-made satellite, many people in China now see how far the country still has to go.

“We realized,” said Dong Jielin, an adjunct professor at the Research Center for Technological Innovation at Tsinghua University in Beijing, “that China’s prosperity was built on sand.”

China now feels a new urgency to change that.

This week, I begin a column for The New York Times that looks at the paradox of modern China through the lens of technology. For years, China has defied the axiom that a free political system and economic growth go hand in hand. The thriving tech industry is the epitome of the so-called China model, which says people can rise and prosper under tight government control.

Most people outside China think of it as “1984,” a dystopian society ruled by a repressive government with powerful brainwashing machines, which it is in many ways. But if you live in China, it feels more like that other dystopian novel, “Brave New World.” It’s a colorful, vibrant and consumeristic society. In many ways, Chinese people have more choice than they ever had before — except when it comes to individual liberty.

China offers a competing vision to those who see technology as a global, liberating force. Its robust online culture coexists with stringent censorship. China forcefully espouses a view of sovereignty in the cyber realm that sees a greater degree of government control than the internet’s creators ever envisioned — a view that doesn’t seem as far-fetched as it once did, as politicians around the world grapple with the unintended consequences of technology.

Before we get to that future, however, the ZTE incident offers a glimpse of where China stands now.

ZTE’s near-collapse has shaken tech entrepreneurs, investors and ordinary Chinese people alike. In social media chat groups, at dinner tables, at industry conferences, terms like “semiconductors” and “fundamental scientific research” have become buzzwords. My novelist, economist and philosophy professor friends all ask me: How far behind is China’s microchip industry? How long will it take us to catch up with the United States? (Some ask even more basic questions, like: What’s a microchip?)

“The recent ZTE incident made us see clearly that no matter how advanced our mobile payment is, without mobile devices, without microchips and operating systems, we can’t compete competently,” Pony Ma, chief executive of the Chinese internet giant Tencent Holdings said last month at a science forum.

China feels new urgency to increase its technological abilities. Its current push — called Made in China 2025 — lies at the root of worsening trade relations between the United States and China. But the problems with ZTE, which had $17 billion in revenue in 2017, will only spur Chinese leaders to push ahead.

“Self-reliance is the foundation for the Chinese nation to stand firmly in the world, while independent innovation is the only way for us to climb the peak of the world’s science and technology,” Xi Jinping, China’s leader, told its top scientists late last month.

As Chinese ask how they can keep up, many are also wondering why they didn’t realize they were so far behind to begin with.

“The best students always think they performed poorly in exams,” said Ding Jichang, founder and chief executive of Mobiuspace, a Chinese mobile app developer, “while the bad students always think they aced it.”

For starters, the idea of China as technology powerhouse isn’t wrong. As Mr. Ding pointed out, Chinese companies early on figured out the power of the smartphone in daily life. ZTE and others are competitive in many areas, like mobile data technology.

But many in China — and many cheerleaders of the Chinese tech scene — also found themselves in a feedback loop of their own making. The powerful propaganda machine flooded out rational voices, said Ms. Dong of Tsinghua University. The tech boom fits perfectly into Beijing’s grand narrative of a national rejuvenation. Innovation and entrepreneurship are top national policies, with enormous financial backing from the government. Even now, some articles critical of China’s lagging semiconductor industry have disappeared from the internet there.

And it wasn’t just Chinese people. Michael Moritz, the American venture capital investor, warned that China “is leaving Donald Trump’s America behind.” Peter Thiel, a PayPal co-founder, wondered how long it would take for China to overtake the United States. Three to four years, he concluded.

The boom kept many from asking hard questions. They promoted China’s surge in patent filings without looking at whether the patents were any good. They didn’t ask why China still imports 90 percent of its semiconductor components even though the industry became a national priority in 2000.

The tone has changed. At an annual conference of top venture capitalists in Shanghai in late April, several major investors admitted that too much money went to start-ups that could go public quickly. Few want to fund the hard work that requires long-term research and development. Now, those investors face some of the blame.

“The public is saying that investors are bastards,” said Ni Zewang, chairman of one of China’s top venture firms, Shenzhen Capital Group, according to the conference transcript.

Allen Zhu, who became famous for investing in star start-ups, including the ride-sharing company Didi Chuxing Technology and the bike-sharing app Ofo, said he invested in a few chip start-ups years ago but lost his money. “For investors, the ratio of investment to returns isn’t proportionate,” he said.

Thanks to the ZTE incident, that problem has gone away.

Albert Liu, chief executive of the chip start-up Kneron, says that in the past, only one of four investors he met with would express any interest in his company. But when he had a round of meetings with 50 investors in May, nine of 10 were interested.

He used to have to spend a lot of time explaining why chips are important in the age of artificial intelligence. Now, he says, investors will tell him: “Let’s skip this. I know why.”

Some Chinese companies are doubling their efforts to develop their own chips. Gree Electric Appliances of Zhuhai, the world’s biggest residential air-conditioner manufacturer, started building its own chips for air-conditioners three years ago in an attempt to lower costs and better control its supply chain.

“After the ZTE incident, we realize how important it is to be able to make chips on our own,” says Tang Xiaohui, a senior executive in charge of Gree’s smartphone and chip development. The company’s chairwoman announced on state television recently that Gree would spend $7.8 billion on chip research and development in the next three years.

The chipsets Gree develops may not be as good as the American ones, Mr. Tang said. “But we’ve got to have a Plan B.”
https://www.nytimes.com/2018/06/10/t...ik-moment.html





Bitcoin’s Price Was Artificially Inflated Last Year, Researchers Say
Nathaniel Popper

A concentrated campaign of price manipulation may have accounted for at least half of the increase in the price of Bitcoin and other big cryptocurrencies last year, according to a paper released on Wednesday by an academic with a history of spotting fraud in financial markets.

The paper by John Griffin, a finance professor at the University of Texas, and Amin Shams, a graduate student, is likely to stoke a debate about how much of Bitcoin’s skyrocketing gain last year was caused by the covert actions of a few big players, rather than real demand from investors.

Many industry players expressed concern at the time that the prices were being pushed up at least partly by activity at Bitfinex, one of the largest and least regulated exchanges in the industry. The exchange, which is registered in the Caribbean with offices in Asia, was subpoenaed by American regulators shortly after articles about the concerns appeared in The New York Times and other publications.

Mr. Griffin looked at the flow of digital tokens going in and out of Bitfinex and identified several distinct patterns that suggest that someone or some people at the exchange successfully worked to push up prices when they sagged at other exchanges. To do that, the person or people used a secondary virtual currency, known as Tether, which was created and sold by the owners of Bitfinex, to buy up those other cryptocurrencies.

“There were obviously tremendous price increases last year, and this paper indicates that manipulation played a large part in those price increases,” Mr. Griffin said.

Bitfinex executives have denied in the past that the exchange was involved in any manipulation. The company did not respond to a request for comment this week.

The authors of the new 66-page paper do not have emails or documents that prove that Bitfinex knew about or was responsible for price manipulation. The researchers relied on the millions of transaction records that are captured on the public ledgers of all virtual currency transactions, known as the blockchain, to spot patterns. This method is not conclusive, but it has helped government authorities and academics spot suspicious activity in the past.

In particular, Mr. Griffin and Mr. Shams examined the flow of Tether, a token that is supposed to be tied to the value of the dollar and that is issued exclusively by Bitfinex in large batches. They found that half of the increase in Bitcoin’s price in 2017 could be traced to the hours immediately after Tether flowed to a handful of other exchanges, generally when the price was declining.

Other large virtual currencies that can be purchased with Tether, such as Ether and Zcash, rose even more quickly than Bitcoin in those periods. The prices rose much more quickly on exchanges that accepted Tether than they did on those that did not, and the pattern ceased when Bitfinex stopped issuing new Tether this year, the authors found.

Sarah Meiklejohn, a professor at the University College London who pioneered this sort of pattern spotting, said the analysis in the new paper “seems sound” after reviewing it this week.

Philip Gradwell, the chief economist at Chainalysis, a firm that analyses blockchain data, also said the study “seems credible.” He cautioned that a full understanding of the patterns would require more analysis.

Mr. Griffin previously wrote research pointing to fraudulent behavior in several other financial markets. He drew attention for a 2016 paper that suggested that a popular financial contract tied to the volatility in financial markets, known as the VIX, was being manipulated. A whistle-blower later came forward to confirm those suspicions, and now several active lawsuits are focused on the allegations.

Beyond his work at the University of Texas, Mr. Griffin has a consulting firm that works on financial fraud cases, including some in the virtual currency industry.

“The relationship between Tether and the price of Bitcoin has been flagged for months within the community,” said Christian Catalini, a professor at the Massachusetts Institute of Technology who specializes in blockchain research. “It is great to see academic work trying to causally assess if market manipulation is taking place.”

The new paper is not the first academic work to identify manipulation in the virtual currency markets. A paper published last year by a team of Israeli and American researchers said much of Bitcoin’s big price increase in 2013 was caused by a campaign of price manipulation at what was then the biggest exchange, Mt. Gox.
https://www.nytimes.com/2018/06/13/t...ipulation.html





Digital IDs Needed to End 'Mob Rule' Online, Says Security Minister Ben Wallace

‘A lot of the bullying on social media and the grooming is because those people know you cannot identify them’
Lizzy Buchan

Digital IDs should be brought in to end online anonymity that permits ”mob rule” and lawlessness online, the security minister has said.

Ben Wallace said authentication used by banks could also by employed by internet firms to crack down on bullying and grooming, as he warned that people had to make a choice between “the wild west or a civilised society” online.

He also took aim at the “phoniness” of Silicon Valley billionaires, and called for companies such as WhatsApp to contribute to society over the negative costs of their technology, such as end-to-end encryption.

It comes after Theresa May took another step against tech giants, saying they would be ordered to clamp down on vile attacks against women on their platforms.

The prime minister will target firms such as Facebook and Twitter as she makes the pitch at the G7 summit this weekend, where she will urge social media firms to treat violent misogyny with the same urgency as they do terror threats.

Mr Wallace told The Times: “A lot of the bullying on social media and the grooming is because those people know you cannot identify them.

“It is mob rule on the internet. You shouldn’t be able to hide behind anonymity.”

The former soldier described being part of an uncover investigation into child sex exploitation where they found a children’s chatroom with a 45-year-old man pretending to be a 12-year-old.

He said: “It was like blood in the water with a shark – he was trying to chat up a girl to get her to come and meet him.

“If we’re going to make the internet safer, we’re going to have to do something more about digital identification.”

Suspected incidents on online child sex abuse referred to the Metropolitan Police have soared by 700 per cent since 2014, according to evidence given to the Independent Inquiry into Child Sexual Abuse earlier this year.

Meanwhile, one in five UK women has suffered online abuse or harassment, of which 27 per cent was threats of sexual or physical assault, according to an Amnesty International survey in March.

Mr Wallace called on social media giants to take responsibility for their own technology, as he said the UK was spending hundreds of millions of pounds on coping with the challenges of end-to-end encryption, which makes it harder for the security services to foil terror plots.

He said: “There should be an element of the ‘polluter pays’. You contribute to the cost your technology is engendering.”

Describing Silicon Valley billionaires, he said: “The phoniness irritates me - it’s, ‘I’m a hippy with a beanbag and, oh yes, there is my superyacht’.

“They accuse the state of surveillance and yet they sell my details to make money. We are the lunch, they are the ruthless ones.”
UK news in pictures

The prime minister has campaigned to rein in tech giants by urging investors to pull funding from irresponsible firms, if they refuse to act on hate-filled content on their platforms.

Speaking ahead of her arrival at the G7 summit, Ms May said: “What is illegal offline is illegal online, and I am calling on world leaders to take serious action to deal with this, just like we are doing in the UK with our commitment to legislate on online harms such as cyberstalking and harassment.

“Online violence against women and girls should not be separated from offline violence, and the technology companies who are making welcome progress in banning and removing extremist content must use the same methods to prioritise tackling this unacceptable and deeply worrying rising trend.”
https://www.independent.co.uk/news/u...-a8390841.html





Girl, 9, in Rehab for Fortnite addiction after Becoming so Hooked She WET HERSELF to Keep Playing

Her horrified parents told how the primary school child is in intensive therapy after #getting hooked on the apocalyptic game
Matthew Barbour

A girl of nine is in rehab after becoming addicted to a video game that is gripping the nation’s kids.

Her horrified parents tonight told how their daughter is in intensive #therapy after #getting hooked on the Fortnite game.

The obsessed primary school pupil...

- Secretly got up in the night and played until dawn.

- Neglected to go to the toilet because she could not bear to leave the screen.

- Hit her father in the face when he tried to confiscate her Xbox gaming console.

- Dozed off in class because of her night-time addiction.

Experts fear she is one of many children at risk of developing mental health problems as a #result of over-exposure to the fight-to-the-death scenarios.

Over 40 million have #downloaded the so-called #survival shooter game since it was launched last July, sparking #record numbers of digital addiction.

The girl’s mum tonight said: “We had no idea, when we let her play the game, of the #addictive nature or the impact it could have on her mental health. She is in #therapy for the addiction after she #became withdrawn, #agitated and disturbed from playing up to ten hours a day – sometimes playing until dawn, wetting #herself so she didn’t have to leave the screen.

“This is a serious issue which is destroying our little girl’s life and someone needs to step in to ban it before it becomes an epidemic.”

Fortnite has been endorsed by a multitude of top sport and music stars.

The game’s most popular format is the Battle Royale in which 100 players fight each other until one is left standing.

Although the game is free to download, its developers make money from hooked users who pay for in-game purchases to boost their performances.

Mum Carol, 36, said they bought their daughter an Xbox in January and shortly after she downloaded Fortnite.

She and her husband Richard, who we are not picturing to protect the identity of their daughter, say it was not until mid-March they noticed #worrying signs.

Carol said: “We got called in by her head #teacher asking if #everything was OK. She had fallen asleep twice in lessons and her grades were slipping.

“When we asked our daughter what the #problem was, she became unusually #argumentative and aggressive, which we just put down to her hormones.”

But soon the sports-mad girl started saying she too tired to go to gym or ballet classes, as well as missing the family visits to church on Sunday mornings.

Noticing small but regular payments on their credit card to Microsoft, adding up to over £50 a month, they asked if she knew anything about this.

The mum said: “Our daughter told us it could be some extras she’d paid for on Fortnite.

“Of course we were furious and confiscated her Xbox. But then she lashed out and hit my husband in the face.”

Despite limiting their daughter’s time on the game to one hour on school nights and two on weekends, they were still suspicious.

Carol said: “My husband saw her light on in the night and found her sitting on a urine-soaked #cushion playing the game.

“I found her backside was red-raw. She was so hooked to the game she wouldn’t even go to the toilet.”

The next morning they sat her down and asked her to tell the truth.

The mum said: “Crying, she told us that every night for the past two months she had waited until we were asleep and then got up to play, sometimes until 5am.

“We worked out that she could have been playing for up to ten hours a day, and we’d had no idea.”

The parents contacted addictions counsellor Steve Pope, who agreed to see the girl for psychotherapy. Steve told the Sunday People: “Over the last two months I’ve been #contacted by dozens of parents with children as young as eight showing signs of addiction to Fortnite.

“I’ve been working in this field for three decades and never seen anything like it, how widespread and potentially damaging this is.

“I know bright kids who will fail their exams this summer because of Fortnite, kids who are stealing from their parents and friends to pay for the extras, kids who urinate in bottles because they can’t bear to leave the game.” Experts claim it is the high-profile celebrity #endorsements in recent weeks that have fuelled exposure.

Steve added: “You see Premier League footballers celebrating goals with Fortnite dances and it’s the biggest possible advert for kids.

“It’s the perfect gateway into #addiction and gambling.”

Professional gamers are making up to £500,000 a month from live-streaming their Fortnite games for addicted children to watch.

The nine-year-old girl in our #report is slowly #getting back on track with her sports and schooling.

But her mum said: “I urge every parent out there to know what this game can do, how it sucks young children in and could ruin lives.”

Culture Secretary Matt Hancock has warned that addictive online shooter games such as Fortnite have a damaging impact on children.
https://www.mirror.co.uk/news/uk-new...oming-12673590





Batteries Hasten Winds of Change for Electricity Stocks: Barron's

Bigger, better batteries are speeding up change in the U.S. electricity sector and could help power a rally in Xcel Energy Inc (XEL.O), American Electric Power Co Inc (AEP.N) and other utility and renewable energy stocks, Barron’s reported.

After a decade of steep cost declines, wind and solar installations, often paired with battery storage, are increasingly displacing older coal and gas-fired power plants, benefiting battery makers and some utilities, the Barron’s cover story said.

Batteries can now store enough electricity to help power small towns when wind and solar supplies ebb, Barron’s said. The United States is expected to install more than 35 megawatts of battery storage through 2025, which could save more than $4 billion in annual operating costs, Barron’s said, citing the Washington-based Energy Storage Association trade group.

Minneapolis-based Xcel plans to draw 45 percent of its power from renewables by 2027, up from 23 percent currently. While the stock is down 11 percent this year, its performance has beaten the S&P 500 Index over the past 10 years, Barron’s said.

American Electric is reducing its reliance on coal and holding gas generation steady, while ramping up wind and solar, in part through the $4.5 billion Wind Catcher project in Oklahoma, which claims to be the largest U.S. wind farm, Barron’s said. The Columbus, Ohio-based company aims for low double-digit stock returns, Barron’s said.

The paper also said NextEra Energy Inc (NEE.N), of Juno Beach, Florida, was combining 100 megawatts of solar capacity with 30 megawatts of battery storage at a project in Arizona.

Investing in battery makers directly is complicated, since Panasonic Corp (6752.T), Tesla Inc (TSLA.O) and other big makers come with a range of revenue streams.

Utility stocks are under pressure as rising bond yields steal some of the appeal of dividend yields. But the outlook is improving for many companies in the Utilities Select Sector (XLU.P), Barron’s said.

Reuters recently reported that a growing number of U.S. utilities are shutting fossil-fuel plants and have no plans to build combined-cycle natural gas power stations, because renewables are so much less expensive, posing problems for power plant makers such as General Electric Co (GE.N).

Reporting by Alwyn Scott; Editing by Peter Cooney
https://www.reuters.com/article/us-e...-idUSKBN1J611L





Cost of Government Rises When Local Newspaper Closes, Study Finds

A study inspired by a John Oliver segment has analysed data from 1,266 US counties and tallied the cost of losing a print watchdog
Edward Helmore

When a local newspaper closes, the cost of government increases. That’s the conclusion of new survey from Notre Dame’s Mendoza College of Business, which draws a direct line between loss of the watchful eyes of local newspapers and a decline in government efficiency.

Paul Gao, a professor of finance at the college, said he got the idea for the study while watching John Oliver’s Last Week Tonight about the decline of local newspapers almost two years ago.

The result of that study, Financing Dies in Darkness? The Impact of Newspaper Closures on Public Finance, argues there is a direct correlation between the loss of a local paper and higher costing – or less efficient – government.
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Dozens of local newspapers have closed, reduced their printing schedule or gone online in recent years. Circulation numbers have fallen approximately 27% from 2003 to 2014, according to the Pew Research Center and there has been a 35% decline in statehouse reporters.

Those reductions have come with a cost, according to Gao. A local newspaper, the authors conclude, holds an important and unique role in the proper functioning of the government and markets.

“Some people told us a local newspaper doesn’t have an important local role. Others said they may play a role, but something else, some other alternative source of media, will come in,” Gao told the Guardian. “We think the local newspaper plays an important and unique role that cannot be easily replaced by an online source or national news media.”

Gao’s team looked at some 1,600 English-language newspapers serving 1,266 counties in the US between 1996-2015 and excluded counties without a daily local newspaper.

In one example, the report looks at the closure in 2009 of Denver’s Rocky Mountain News. The paper had provided extensive coverage of local government issues, including an audit of questionable federal funds allocated to the sheriff’s department, and a series of other handshake deals.

Gao’s team looked at how tax dollars were being spent while the paper was being published and then again after the paper had closed. The researchers concluded that Rocky Mountain News stories had served as a watchdog agent. Without it, the spread or yield of newly issued local municipal bonds increased by 37 basis points.

In other words, local government’s cost of borrowing money – and therefore risk – had increased once the paper had gone.

The researchers also looked at the Cincinnati Post, which closed in 2007. In that instance too, the median yield spread for newly issued local municipal bonds increased by about 66.1 basis points – another indication, according to the authors, that public finances suffer when a newspaper closes.

Gao does not offer any particular solution – his job, he says, is just to raise the issue.

“We can’t offer a solution because this is to do with public good, not statistical analysis,” he said. “You cannot effectively charge public good. So we hope this paper raises awareness of the importance of a local newspaper. It’s like a public good or an environmental protection. Good to have but, we also recognize, ultimately costly.”
https://www.theguardian.com/media/20...es-study-finds





With Public Support High, Boulder Moves to Fund Citywide Fiber Buildout Through Debt

Unanimous vote OKs certificates of participation to construct broadband backbone
Shay Castle

Citing high public support and demand for better, cheaper internet, Boulder's City Council on Tuesday voted unanimously to fund through the issuance of debt the $15 million construction of what will become the backbone of a citywide broadband network.

In a survey, the results of which were presented publicly for the first time during Tuesday night's meeting, 90 percent of respondents supported city-owned and -operated internet, and as many said they would be very or somewhat likely to purchase service from the city.

Another surprising result was the share of households — somewhere between 4 percent and 7 percent — with no internet service, due to lack of access or affordability. A staff-provided map showed that most of the under-served areas were in low-income neighborhoods.

"It's embarrassing for me that in somewhere like Boulder, (that much) of the community doesn't have access to internet," Councilman Bob Yates said. "The internet has become a fundamental need. Imagine if 4 to 7 percent of our community didn't have water or electricity."

Part of Boulder's plan for creating a broadband network emphasizes providing service to under-served and low-income residents, a priority that 91 percent of survey respondents also supported.

During a public hearing before the council, Rossana Longo spoke of the widespread lack of access among the Latino community.

"I am one of those lucky Latinas who have access to internet," Longo said. "For the last two years, I have been trying to create radio services for Spanish-speaking people. Again and again when I go to register them, they don't have internet at home."

Though fewer than 10 people spoke during the public hearing, all supported the city moving forward in the quickest and most efficient manner. City staff had presented four funding options to the council: two would not require voter approval, while two would.

Chief Financial Officer Cheryl Pattelli said paying for the estimated $15 million buildout was not a viable option given the looming budget shortfall. There is some capacity for debt, she said, through the issuance of certificates of participation.

The council ultimately voted to direct city staff to explore the issuance of certificates of participation to fund the buildout.

A 20-year debt structure would require annual payments of $1.1 million from the city, according to staff estimates. That could be supplemented with money from the city's general fund and, perhaps, revenue generated by early customers of the fiber network.
The idea of partnerships with existing commercial internet service providers was floated, as well as teaming with Boulder Housing Partners to provide service to residents at lower rates than are currently paid.

Such arrangements could provide revenue for the eventual total buildout, Yates said. The estimated cost of the entire network is around $140 million.

Though more than 80 percent of survey-takers said they would support a sales tax to fund the backbone build, the council worried that would not translate to success at the ballot.

"I'm a little reluctant to go to voters with this because this phase won't deliver internet," Yates said.

Other members echoed that, and said they felt comfortable moving forward given the overwhelming support for the use of public funds for the infrastructure construction: also 80 percent.

"How many things poll at over 90 percent?" asked Aaron Brockett, "Not much."
http://www.dailycamera.com/news/boul...citywide-fiber





How Net Neutrality Actually Ended Long Before This Week
Farhad Manjoo

I remember the first time I ever heard about net neutrality. It was around 2004 or 2005, and when the full idea was explained to me — hey, let’s prevent phone and cable companies from influencing the content we see online — I was surprised there was even a fight about the idea.

It seemed obvious that the internet’s great promise was that it operated outside the purview of existing communications monopolies. Because phone and cable companies couldn’t easily dictate what happened online, the internet was exploding in dozens of genuinely new ideas. Among those back then were blogs, Skype, file-sharing, YouTube, Friendster, Netflix — ideas that scrambled our sense of what was possible in media and communication, and, in the process, posed existential threats to the established giants.

Other than the phone and cable companies themselves, I couldn’t see why anyone might oppose the simple premise of protecting the environment that had made all these things possible. Did they hate clean water, too?

Yet a decade and a half later — as Ajit Pai, the chairman of the Federal Communications Commission, buries net neutrality alive with his repeal of its rules, an act that took effect Monday — I’m no longer surprised that there was a fight over this. Instead, I’m surprised that net neutrality lasted this long. Activists are still fighting to resurrect it, and while they are winning some battles — after all, net neutrality remains extremely popular — I’m increasingly resigned to their long-run defeat.

Net neutrality was too good for us. And even if rules are restored, the notion that the internet should afford at least a minimally competitive landscape for new entrants now seems as antiquated as Friendster.

What’s driving this view is what has happened over the last decade, which hasn’t been too kind to disruptive competition online. By the time Tom Wheeler, an F.C.C. chief under President Barack Obama, handed down rules to protect neutrality in 2015, we had already strayed quite far from the internet of the early 2000s, where upstarts ruled our lives.

Today, the internet is run by giants. A handful of American tech behemoths — Amazon, Apple, Facebook, Google and Microsoft — control the most important digital infrastructure, while a handful of broadband companies — AT&T, Charter, Comcast and Verizon — control most of the internet connections in the United States.

The very idea that large companies can’t dictate what happens online is laughable now. Large companies, today, pretty much are the internet. In this world, net neutrality didn’t have a chance.

So, what now?

There’s a misunderstanding that the repeal of net neutrality will result in immediate and drastic change online. That won’t happen. With lawsuits and legislation pending, with the media still paying attention and with activists poised to pounce on obvious infractions, broadband companies are going to be extremely careful, in the short run, to be on their best behavior. The internet won’t be slower tomorrow. You won’t be blocked from certain sites. You aren’t going to be charged more.

But as I argued last fall, a vibrant network doesn’t die all at once. Instead it grows weaker over time, with innovative start-ups finding it ever more difficult to fight entrenched incumbents.

As I’ve noted often in the last few years, big companies have been crushing small ones over and over again for much of the last decade. One lesson from everything that has happened online recently — Facebook, the Russians and Cambridge Analytica; bots and misinformation everywhere — is that, in the absence stringent rules and enforcement, everything on the internet turns sour. Removing the last barriers to unfair competition will only hasten that process.

It’s not going to be pretty.

“History shows us that companies that have the technical capacity to do things, the business incentive to do them and the legal right — they will take advantage of what is made available to them,” said Jessica Rosenworcel, an F.C.C. commissioner and a Democrat, who voted against the repeal of net neutrality last year.

By repealing neutrality rules, the government has just given our online overlords that legal right, she cautioned.

“Now they can block websites and censor online content,” Ms. Rosenworcel said. “That doesn’t make me feel good — and if you rely on the internet to consume or create, it shouldn’t make you feel good, either.”
https://www.nytimes.com/2018/06/11/t...ty-repeal.html

















Until next week,

- js.



















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