July 20, 2007
Internet Radio Relief Held Up Over DRM
As last we heard, Internet radio was about to be crushed by stifling royalty rates that would wipe out small broadcasters and force large ones to rethink their strategy. SoundExchange offered an olive branch at the last minute, postponing the new rates for more talks. The discussions centered around more reasonable rates and caps on per channel fees. The snag that cropped up is everybody's favorite bugaboo, DRM. SoundExchange would give more favorable rates to broadcasters in exchange for implementing anti-streamripping technologies.
The Digital Media Association, representing broadcasters, read the offer as something akin to looking into the feasibility of such technology. SoundExchange shot back that, no, when they meant implementing DRM, they meant implementing DRM and nothing less. The acrimony in the negotiations is in the press and no real breakthrough has surfaced.
This fight is not unique to U.S. broadcasters. The Guardian Unlimited is reporting on the same fight being waged in the United Kingdom. The UK Copyright Tribunal issued a similar ruling mandating higher rates and the fight over there is no less harsh as to how this is going to come out. One prediction: those who can move their servers out of the jurisdiction probably will. Welcome to the Cayman Islands. Another is that consumers faced with the restrictions imposed on the content simply will not care and go to other sources where they have more freedom. One thing is for sure: CD sales will continue to decline, and DRM on a radio stream is not going to stop that from happening.
Comment on the Game Console Wars
Here's a story where someone just doesn't get it. Digital Spy has a story quoting Earthworm Jim creator Dave Perry saying that the Nintendo Wii will not have long term appeal. The reason, he says, is that gamers are attracted to gorgeous graphics, something the Wii lacks in comparison to the XBox and the PS3. What he fails to realize is that Sony and Microsoft already have that market.
Nintendo expanded the market by going after casual gamers and even non-gamers who normally would not buy or play games. A lot of people are not willing to commit 40 hours of their lives fighting trolls and moving up levels in a complex game. They are willing to swing their arms playing Nintendo bowling or tennis for half an hour at a time, however. A number of people who bought the Wii would have never considered the other consoles. That's not to say that the Wii and successor systems couldn't lose out to others in the future. But please, credit Nintendo with a broader view of their customers for their success.
July 18, 2007
Google Loses Search Share, Microsoft Gains Through Gimmicks
Google lost some search market last month, dropping from 50.7% in May to 49.5% in June. Investors were not worried as Google still brings in the big bucks (reporting financial results Thursday, by the way). Yahoo!, on the other hand, still disappoints on that score. The Panama search system that would help revitalize revenue is working, but apparently not enough to forestall disappointing results reported Tuesday. Yahoo! also lost search market, going from 26.4% to 25.1%. The winner in June was Microsoft, who went from 10.3% to 13.2%. The reason for that is the Windows Live Search Club where the software giant sponsors games that require players to use Live Search for clues and answers. The incentive is points for software and other commodities from Microsoft. Some reports suggest that players are racking up the points using bots to conduct searches, which kind of inflates their market share artificially. The way Windows Live has been going, MS will probably take the results, although paying advertisers may want to ask a few questions.
FBI Uses Home Grown Spyware to Catch Student Bomb Threat Maker
Ever wonder how technically capable the FBI could be in bugging computers? Then check out the report in Wired over how they planted software on a 15 year old's computer in a bomb threat case. Josh Glazebrook was a student at Timberline High in Washington state. He sent harassing email to fellow students via a hacked server in Italy and set up a bomb threat page on MySpace, actually calling it Timberlinebombinfo.
The FBI got a court order allowing the agency to use a program it calls CIPAV, or computer and Internet protocol address verifier. According to the FBI affidavit obtained by Wired, the program acts like spyware and can obtain the following information (and more, apparently):
- IP address
MAC address of ethernet cards
- A list of open TCP and UDP ports
- A list of running programs
- The operating system type, version and serial number
- The default Internet browser and version
- The registered user of the operating system, and registered company name, if any
- The current logged-in user name
- The last visited URL
The kid was ultimately identified and arrested through information gathered through the program. Glazebrook's attorney tried to minimize his client's activity with the "ha ha, just kidding" defense. The penalty so far is 90 days in jail and two years of probation with restrictions on computer use.
The real focus of the story is on the actual capability of the FBI and how its "spyware" approach to electronic investigation may compromise security companies who root out this type of attack for clients. The FBI is not kidding when it comes to electronic surveillance. We've come a long way from keyloggers.
July 17, 2007
House Committee Marks Up Bill on SSN Privacy
The House is considering bills that would criminalize the fraudulent sale or use of Social Security numbers. One is particular is scheduled for a vote in the House Ways and Means Committee. That is H.R. 3046, the Social Security Number Privacy and Identity Theft Protection Act of 2007. According to the summary provided by the House Committee, the bill would prohibit Federal, State and local governments from:
- Selling SSNs (limited exceptions would be allowed, such as to facilitate law enforcement and national security, to ensure the accuracy of credit and insurance underwriting information and certain other Fair Credit Reporting Act purposes, for tax purposes, for research purposes, and to the extent authorized by the Social Security Act.) Further exceptions may be made for other purposes by regulation.
- Displaying SSNs to the general public, including on the Internet.
- Displaying SSNs on checks issued for payment and on accompanying documents.
- Displaying SSNs on identification cards and tags issued to employees or their families; patients and students at public institutions; and Medicare cards.
- Employing prisoners in jobs that provide them with access to SSNs.
- Requiring the transmission of SSNs over the Internet without encryption or other security measures.
The private sector would be prohibited from:
- Selling or purchasing SSNs (limited exceptions would be made for law enforcement (including child support enforcement); national security; public health; health or safety emergency situations; tax purposes; to ensure the accuracy of credit and insurance underwriting information and certain other Fair Credit Reporting Act purposes; if incidental to the sale, lease or merger of a business; to administer employee or government benefits; for some research; or with the individual's affirmative, written consent. Further exceptions may be made for other purposes by regulation.
- Displaying SSNs to the general public, including on the Internet.
- Displaying SSNs on checks.
- Requiring the transmission of SSNs over the Internet without encryption over the Internet without encryption or other security measures.
- Making unnecessary disclosures of another individual's SSN to government agencies.
- Displaying the SSN on cards or tags issued to employees, their family members, or other individuals.
- Displaying the SSN on cards or tags issued to access goods, services, or benefits.
Other provisions of the Act would create penalties of up to 5 years imprisonment and fine up to $250,000 for violations of the law relating to the display, sale, purchase, or misuse of the SSN, for offering to acquire an additional SSN for a fee, and for selling or transferring one's own SSN. There would also be a civil penalty of up to $5,000 per incident. Enhanced penalties would be applicable to repeat offenders. One provision specifically would allow the States to place stronger protections over the use of SSNs without preemption.
Bikes Can't Compete With the Internet
In a video killed the radio star moment, the San Francisco Chronicle is reporting on the decline of the bike messenger business in the northern California area. The cause? The Internet, as in emailing documents, electronic filing of court documents, electronic signatures, and the relatively instant transfer of paper between parties. The trend probably extends beyond San Francisco.
July 16, 2007
Google Australia Sued for Deceptive Trade Practices
This one comes from regular commentator Simon Cast. The Australian Competition and Consumer is suing Google, Google Ireland, Google Australia, and Trading Post Australia over deceptive advertising practices. Specifically, the suit complains that these entities are in violation of Sections 52 and 53(d) of the Trade Practices Act of 1974.
Section 52 reads:
52 Misleading or deceptive conduct
(1) A corporation shall not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.
(2) Nothing in the succeeding provisions of this Division shall be taken as limiting by implication the generality of subsection (1).
The relevant section of 53(d) reads:
53 False or misleading representations
A corporation shall not, in trade or commerce, in connexion with the supply or possible supply of goods or services or in connexion with the promotion by any means of the supply or use of goods or services:
* * * *
(d) represent that the corporation has a sponsorship, approval or affiliation it does not have;
* * * *
The acts that the Commission complains of are the appearance of ads for Kloster Ford and Charlestown Toyota under a sponsored ad heading to link to Trading Post. These dealerships are, in fact, competitors to Trading Post. Google is charged under Section 52, and Trading Post is charged under Sections 52 and 53(d).
Google Australia denies the charges. Spokesperson Rob Shilkin stated "Google Australia believes that these claims are without merit and we will defend against them vigorously. They represent an attack on all search engines and the Australian businesses, large and small, who use them to connect with customers throughout the world." The ACCC for its part says that it is the first regulatory body to seek legal clarification of Google's conduct from a trade practices perspective. Peter Coroneos, Chief Executive of the Internet Industry Association said "The internet industry has always had a positive relationship with the ACCC. It's very unfortunate that the ACCC has decided to pursue a litigious strategy against one participant, rather than consulting more broadly on an issue that affects the entire industry."
The US FTC has examined the issue of the placement of paid or sponsored ads appearing as part of search results. A 2002 letter responding to a complaint about broad practices found no violation of the Federal Trade Commission Act as most search engines identified ads that were paid in one form or another. That's not quite the same as the situation in Australia, though it seems on its face that Google is better positioned than Trading Post, assuming Trading Post bought the ad words that created the links. Courts in the United States have split on whether buying a competitor's name is a violation of trademark law. Whether that's true in Australia remains to be seen.
The case is scheduled to be heard in federal court on August 21st in Sydney. The ACCC press released is here.