BlogDrome

Court Overturns Ninth Cir., Upholds FCC Ruling in Brand X Case (Ernest Miller)

via SCOTUS Blog:

In a 6-3 ruling, the Court decided that cable operators offering high-speed Internet access have no legal duty to open their service to customers of all Internet service providers.

, the Court upheld the decision of the Federal Communications Commission that broadband cable moden companires arfe exempt from mandatory common-carfrier regulation. That, Thomas wrote, is a lawful interpretation of the Communications Act, and thus is due deference.Will update when the decision is available.

Public Knowledge is first out of the gate with a statement from their president, Gigi Sohn:

The Court's decision today raises the question of whether Congress, in tackling its next revision of the Telecommunications Act, should act to ensure that communications, content, and applications are allowed to pass freely over the Internet's broadband pipes. We believe Congress should do so, because "net neutrality" is a worthy goal that not only will promote free speech and creativity on the Internet, but also will benefit those who provide broadband connectivity by making that connectivity more valuable.

Susan Crawford: The Supremes Got Grokster Just Right (Donna Wentworth)

Cardozo law professor Susan Crawford, in a post entitled, "A Balanced View":

Today's Grokster opinion is a victory for content AND for technology. I was afraid that Sony would be undermined -- and it wasn't. The content guys were afraid that they wouldn't be able to go after bad guys -- and they've been given ammunition. What we've got is an opinion that is balanced and middle-of-the-road. It leaves Sony's "substantial noninfringing use" standard alone (yes, the concurring Justices snipe back and forth about what that standard means, but that doesn't matter), it doesn't adopt any formless Aimster balancing test, and it says strongly that you can't impute intent to technology. A good day for innovation. And a good day for Congressional staff, who won't have to deal with some request for Induce legislation -- we're done.

Over @ the SCOTUS Blog forum, C.E. Petit disagrees:

Professor Crawford argues that Grokster was a "balanced" opinion. In the sense that Grokster pretty much leaves Sony alone, I agree. In the sense that technology itself can continue to advance—it's just business plans that misuse technology that are suspect—I agree.

ough, that the end result is "balanced," or that Aimster establishes a "formless balancing text." I think what the Court did here was largely to evade the Sony test's theoretical foundation with two limiting devices.

Seth Finkelstein, in the comments below: "It's not so much 'balanced' so much as 'buffeted by conflicting forces' -- not at all the same thing! :-) "

Whither Movies? (Alan Wexelblat)

In the wake of Grokster, NPR's Morning Edition carried a good piece this AM on the ongoing slump in box office sales. Titled "Movie Industry Refocuses Amid Box-Office Slump" the piece examined the current decline in US box office ticket sales.

The current movie year is not being good to Hollywood. Last week was the 18th straight week in which year-over-year ticket sales were down (that is, comparing 2005 to 2004). Since spring and summar are traditional big movie-going times for Americans this is somewhat surprising. What's also surprising was that Kim Masters' story didn't just point the finger at P2P and shout "piracy."

Indeed, there are two fairly direct explanations for the decline in revenue, which amounts to about USD300 million. One is that there are fewer movies coming out. Six fewer than last year. On average, a big Hollywood movie will make $50 million in ticket sales. The math adds up. Two is that last year at this time a big box-office seller was Mel Gibson's The Passion of the Christ. I've seen ticket figures for this movie ranging from $330 million to $390 million. In addition, this movie appealed to an audience that doesn't traditionally go to Hollywood movies. Losing that revenue this year also explains the change.

So, what to do about it? Masters reports on a number of experiments in altering traditional distribution methods, including shorter times to release DVDs (where movies make most of their money), simultaneous release, or even releasing big budget films direct to DVD.

All of these are responding to the changing demographics and finances of the box office business. In particular, a large segment of the audience just don't go out to movies as much because they're older, have kids, and have a harder time getting out. Couple this with the change in financing, where DVD prices are going down (now often below $20 even for first releases) and ticket prices are going up. Two tickets alone are $20; add in costs for babysitting, parking, and snacks and you've created an equation that doesn't favor the box office.

Of course, all of these changes and proposals are causing heartburn for theater owners, who see Hollywood as using the piracy claim as a smokescreen for shifting money away from the box office. The owners want to see more movies, better movies, and better promotion.

Grokster Decision - as Text

Here is the Grokster [PDF] decision as text, including the concurring opinions. You don't want to miss Justice Breyer's concurring opinion, at the very end. He explains Sony and shows why it would be dangerous to broaden it or tamper with it, as MGM wanted. And as far as he is concerned, their arguments about percentages totally failed to impress. He points out that the numbers of noninfringing users of Sony at the time the case was decided was about equivalent to the numbers now using P2P for legitimate purposes: But of all the taping actually done by Sony's customers, only around 9% was of the sort the Court referred to as authorized.The Court found that the magnitude of authorized programming was "significant," and it also noted the "significant potential for future authorized copying." . . . On the basis of this testimony and other similar evidence, the Court determined that producers of this kind had authorized duplication of their copyrighted programs "in significant enough numbers to create a substantial market for a noninfringing use of the" VCR .. . . The Court, in using the key word "substantial," indicated that these circumstances alone constituted a sufficient basis for rejecting the imposition of secondary liability. . . . When measured against Sony's underlying evidence and analysis, the evidence now before us shows that Grokster passes Sony's test -- that is, whether the company's product is capable of substantial or commercially significant noninfringing uses. Id., at 442. For one thing, petitioners' (hereinafter MGM) own expert declared that 75% of current files available on Grokster are infringing and 15% are "likely infringing." . . . That leaves some number of files near 10% that apparently are noninfringing, a figure very similar to the 9% or so of authorized time-shifting uses of the VCR that the Court faced in Sony.When I read this opinion, I feel that the tide has begun to turn and that MGM has gone as far as they can go. Take a look at this sentence: Will an unmodified Sony lead to a significant diminution in the amount or quality of creative work produced? Since copyright's basic objective is creation and its revenue objectives but a means to that end, this is the underlying copyright question. See Twentieth Century Music Corp. v. Aiken, 422 U. S. 151, 156 (1975) ("Creative work is to be encouraged and rewarded, but private motivation must ultimately serve the cause of promoting broad public availability of literature, music, and the other arts"). Someone send Darl McBride a memo, please. He had that backwards, as I recall, in his December 2003 "greed is good" manifesto. The Breyer concurring opinion is one of the most encouraging things I have read in a long time. His opinion was joined by Justices Stevens and O'Connor. It's so good to know that finally all the educational efforts are beginning to bear fruit. At least three justices on the US Supreme Court really do get it.

Rip, Mix, Burn: Grokster Sets 'Affirmative Steps To Induce' Standard

S Ct. reverses 9th Cir. 9 - 0, articulating an 'affiramtive steps to foster infringement' standard.  Text of Grokster decision.

Important language:

 . . . one who distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, is liable for the resulting acts of infringement by third parties.  We are of course mindful of the need to keep from trenching on regular commerce or discouraging the development of technolgoies with lawful or unalwful potential.  Accordingly, just as Sony did not find intentional inducement despite the knowledge of the VCR manufacturer that its device could be used to infringe . . . mere knowledge of infringing pontential or of actual infringing uses would not be enough here to subject a distributor to liability.  Nor would ordinary acts incident to product distribution, such as offerring customers technical support or product updates, support liability in themselves.  The inducement rule, instead, premises liability on purposeful, culpable epxression and conduct, and thus does nothing to compromise legitimate commerce or discourage innovation having a lawful promise.

Heavy-Hitters Join Pro-Municipal Broadband Legislative Battle

Dell, Intel, Texas Instruments, and others want more broadband to sell more gear to consumers: They've increasingly gotten involved in the ongoing debate over whether incumbent monopolies and duopolies deserve right of first refusal for broadband deployment in their service areas over municipalities because of incumbents' investments, municipalities' tax-free and bond-raising abilities, and the role of government in competing with private enterprise.

The Wall Street Journal walks through the issue, starting with a small town in Texas that's building broadband because SBC can't or won't. The Texas legislature was considering a telecom "reform" bill--a bill which removed many public service and oversight controls on telcos--that would also have banned municipalities from participating in broadband. The original bill was so broad it would have banned virtually all private-public partnerships that the FCC and the Bush Administration have stressed for extending broadband into the furthest reaches of the country.

The backlash is now coming since Texas's bill hit defeat for a variety of reasons, partly including Dell's founder picking up the phone and calling legislators. You see, computer makers would enjoy selling more equipment and one way to do that is broadband. (Homes with broadband connections tend to buy newer equipment and more computers, among other reasons.)

Pete Sessions (R-Texas) has introduced a bill at the national level to pre-empt local legislation (there's that anti-federalism again) governing municipal operation of broadband. Sessions is the representative from SBC: a former employee with huge stock and stock options held directly (not in trust) with a spouse who currently works there. His chief of staff told the Wall Street Journal that "the congressman's ties to SBC do not present a conflict of interest." Except in that he has millions of dollars at stake over SBC's continued performance in the market.

The Big Picture: The New Logic of Money and Power in Hollywood

Read The Big Picture: The New Logic of Money and Power in Hollywood by Edward Jay Epstein. Epstein writes The Hollywood Economist column for Slate.com. He wrote the articles Paranoia for fun and profit: How Disney and Michael Moore cleaned up on Fahrenheit 9/11, and Dumb money: the madness of movie advertising. Here’s what The Washington Post says about the book —

The blockbusters do well enough in American theaters, but ticket sales are a drop in the bucket: of total earnings, the biggest chunk comes from worldwide DVD sales. Epstein persistently argues that theatrical release now exists not to make money, but to open the way for “intellectual property” income to be earned over the long term from other sources. As the “Midas formula” makes plain, these movies are strictly product; they may win the occasional award, since Hollywood reveres success, but they have little, if anything, to do with cinematic art.

Such art as does still emerge from Hollywood can be found in the comparatively modest productions from specialty film units such as Miramax, Sony Classics, Fox Searchlight, Paramount Classics, and Warner Independent Pictures, which are a return not so much to the studio system as to the art-house system, which had at one time coexisted alongside the Hollywood studios. These movies are modest only by Hollywood standards: Their average cost was an astounding US$61.6 million in 2003, nearly two-thirds that of studio movies, and since many of the more adult films produced by the independent subsidiaries did not appeal to the youth-oriented toy, game, and other ancillary markets, they often resulted in huge losses for the studios. [Read the rest of the review at Amazon.com]

Buy The New Logic of Money and Power in Hollywood, by Edward Jay Epstein, from Amazon.com — you’ll save money, and your purchase through this link supports Cinema Minima.

Verizon makes it 50

50 markets for EV-DO. Verizon is making PR hay out of reaching 50 markets with its medium speed mobile data product, EV-DO, by announcing another 15, bringing it, in theory at least, ahead of its two main competitors: Sprint and Cingular (SBC). Forbes.com. The new markets..

Internet stocks looking weak

Internet stocks are looking weak. That's the conclusion of an analysis of a chart analysis of  Internet HOLDRs (ticker: HHH), an exchange-traded fund that tracks a a basket of Internet stocks, on ETF Investor. The full piece is below; but before you read it, bear in mind that HHH does not include Google (ticker: GOOG). Since Google is the Internet stock with the largest market cap, HHH would look signficantly stronger if Google was included. And HHH's weakness may also reflect concerns that Google is attacking the core businesses of firms like Yahoo and eBay. With that caveat, here's the full article:

I was just going through my list of Exchange Traded Funds (ETFs), which is ranked by their year-to-day returns, writes Nick Perry, who covers ETFs for Schaeffer's Investment Research. At the bottom of the list is the Internet HOLDRS (HHH) with a loss of a little more than 20-percent.

This compares to a loss of just over one percent for the S&P 500 (SPX). A check of the HHH chart shows an interesting development.

Created with SuperCharts by Omega Research

I have been tracking this chart for some time (we last looked it earlier this month) as the HHH has been struggling since breaking that two and a half year uptrend highlighted by the red channel. The green line is the 10-month moving average which has capped the shares this month. Major support sits near 50, which was low for this year and was the closing low for 2004.

This is worth noting because there has been a good deal of buzz around internet stocks. With more than 70 percent of the analysts tracked by Zacks rating Yahoo (YHOO) as a "buy" and eBay (EBAY) gracing a couple of magazine covers recently, it appears that expectations are fairly high. While that doesn't dictate that a fall has to happen, it does raise the odds that a disappointment may be lurking...

Not subscribed to The Internet Stock Blog? You can get updated headlines for free by adding The Internet Stock Blog to your My Yahoo page. Just log into your My Yahoo page, then go to The Internet Stock Blog and click on the "+ My Yahoo" button on the top right of your screen. You can do the same for other sites, such as The China Stock Blog, ETF Investor, Radical Guides and Seeking Alpha.

Down to the Wire

Once a leader in Internet innovation, the United States has fallen far behind Japan and other Asian states in deploying broadband and the latest mobile-phone technology. This lag will cost it dearly. By outdoing the United States, Japan and its neighbors are positioning themselves to be the first states to reap the benefits of the broadband era: economic growth, increased productivity, and a better quality of life. [Foreign Affairs] '-- In the first three years of the Bush administration, the United States dropped from 4th to 13th place in global rankings of broadband Internet usage. Today, most U.S. homes can access only "basic" broadband, among the slowest, most expensive, and least reliable in the developed world, and the United States has fallen even further behind in mobile-phone-based Internet access. The lag is arguably the result of the Bush administration's failure to make a priority of developing these networks. In fact, the United States is the only industrialized state without an explicit national policy for promoting broadband. --' Read it and weep. The American Telecoms acting like Russian Polit Bureaus, with armies of lobbyist in Washington spreading truck loads of money, are defending their turf at any cost. Satisfying greed immediately is blinding the Telecoms and Washington to the riches of the future. ...John

Broadcast Flag stalled once again

It was a close call, but an amendment that would have tacked the Broadcast Flag onto an appropriations bill failed to make it out of a Congressional subcommittee yesterday. Apparently H.R.2862 was referred to the Committee on Appropriations without the amendment in question attached, which means that, for the time being at least, we’re in the clear. Hard to imagine this being the end of the line though, since the MPAA is damned determined to get this thing enshrined into law, but public awareness about the Broadcast Flag and why it needs to be stopped seems to be growing, which will hopefully make it more difficult for some bought-and-paid-for Senator or Representative to sneak this through.

[Thanks, Mark]

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CardSystems Exposes 40 Million Identities

The personal information of over 40 million people has been hacked. The hack occurred at CardSystems Solutions, a company that processes credit card transactions. The details are still unclear. The New York Times reports that "data from roughly 200,000 accounts from MasterCard, Visa and other card issuers are known to have been stolen in the breach," although 40 million were vulnerable. The theft was an intentional malicious computer hacking activity: the first in all these recent personal-information breaches, I think. The rest were accidental -- backup tapes gone walkabout, for example -- or social engineering hacks. Someone was after this data, which implies that's more likely to result in fraud than those peripatetic backup tapes.

CardSystems says that they found the problem, while MasterCard maintains that they did; the New York Times agrees with MasterCard. Microsoft software may be to blame. And in a weird twist, CardSystems admitted they weren't supposed to keep the data in the first place.

The official, John M. Perry, chief executive of CardSystems Solutions...said the data was in a file being stored for "research purposes" to determine why certain transactions had registered as unauthorized or uncompleted.

Yeah, right. Research = marketing, I'll bet.

This is exactly the sort of thing that Visa and MasterCard are trying very hard to prevent. They have imposed their own security requirements on companies -- merchants, processors, whoever -- that deal with credit card data. Visa has instituted a Cardholder Information Security Program (CISP). MasterCard calls its program Site Data Protection (SDP). These have been combined into a single joint security standard, PCI, which also includes Discover, American Express, JCB, and Diners Club. (More on Visa's PCI program.)

PCI requirements encompass network security, password management, stored-data encryption, access control, monitoring, testing, policies, etc. And the credit-card companies are backing these requirements up with stiff penalties: cash fines of up to $100,000, increased transaction fees, orand termination of the account. For a retailer that does most of its business via credit cards, this is an enormous incentive to comply.

These aren't laws, they're contractual business requirements. They're not imposed by government; the credit card companies are mandating them to protect their brand.

Every credit card company is terrified that people will reduce their credit card usage. They're worried that all of this press about stolen personal data, as well as actual identity theft and other types of credit card fraud, will scare shoppers off the Internet. They're worried about how their brands are perceived by the public. And they don't want some idiot company ruining their reputations by exposing 40 million cardholders to the risk of fraud. (Or, at least, by giving reporters the opportunity to write headlines like "CardSystems Solutions hands over 40M credit cards to hackers.")

So independent of any laws or government regulations, the credit card companies are forcing companies that process credit card data to increase their security. Companies have to comply with PCI or face serious consequences.

Was CardSystems in compliance? They should have been in compliance with Visa's CISP by 30 September 2004, and certainly they were in the highest service level. (PCI compliance isn't required until 30 June 2005 -- about a week from now.) The reality is more murky.

After the disclosure of the security breach at CardSystems, varying accounts were offered about the company's compliance with card association standards.

Jessica Antle, a MasterCard spokeswoman, said that CardSystems had never demonstrated compliance with MasterCard's standards. "They were in violation of our rules," she said.

It is not clear whether or when MasterCard intervened with the company in the past to insure compliance, but MasterCard said Friday that it had now given CardSystems "a limited amount of time" to do so.

Asked about compliance with Visa's standards, a Visa spokeswoman, Rosetta Jones, said, "This particular processor was not following Visa's security requirements when we found out there was a potential data compromise."

Earlier, Mr. Perry of CardSystems said his company had been audited in December 2003 by an unspecified independent assessor and had received a seal of approval from the Visa payment associations in June 2004.

demonstrates some limitations of any certification system. One, companies can take advantage of interpersonal and intercompany politics to get themselves special treatment with respect to the policies. And two, all audits rely to a great extent on self-assessment and self-disclosure. If a company is willing to lie to an auditor, it's unlikely that it will get caught.

Unless they get really caught, like this incident.

Self-reporting only works if the punishment exceeds the crime. The reason people accurately declare what they bring into the country on their customs forms, for example, is because the penalties for lying are far more expensive than paying any duty owed.

If the credit card industry wants their PCI requirements taken seriously, they need to make an example out of CardSystems. They need to revoke whatever credit card processing license CardSystems has, to the maximum extent possible by whatever contracts they have in place. Only by making CardSystems a demonstration of what happens to someone who doesn't comply will everyone else realize that they had better comply.

(CardSystems should also face criminal prosecution, but that's unlikely in today's business-friendly political environment.)

I have great hopes for PCI. I like security solutions that involve contracts between companies more than I like government intervention. Often the latter is required, but the former is more effective. Here's PCI's chance to demonstrate their effectiveness.

Safa: Google Wallet Likely, Listings Service Also

Safa Rashtchy released a note today (PDF only, no link) saying his sources are confirming the Journal's story, and reminding us that he earlier noted that Google may launch a listings service as well.

• We had noted earlier this year that we believe Google is likely to introduce both a listings product (similar to "Craigslist" but much more powerful) and a C2C/B2C transaction and payment platform. If Google Wallet indeed launches this year, it will be initially aimed as an additional service to over 200,000 Google merchants, many of whom also use eBay.

Google will of course be facing significant hurdles to compete with the well-established PayPal, which has more than 72M users. However, we note that when Google entered the paid listing business, it also had to catch up with a much more established Overture, which it eventually replaced as the number one provider of paid search listings.

Financial Times Tries To Explain Away Link Spam By Claim It's Prettier

We were pretty surprised last week when it came to light last week that the Financial Times had sold invisible links to a link spammer. While some smaller, struggling sites, had been outed recently doing the same thing, it seemed like someone at the Financial Times would know better. Apparently not. While the publishers eventually did pull the links, it wasn't before they had a spokesperson go out and try to defend the hidden links because they looked much nicer: "They just didn't want to clog up the real estate with an overt link." Oh, riiiiight. Because advertisers are really careful about not "clogging up" the real estate of the publications in which they advertise. And it never (not once) occurred to someone at the Financial Times to ask why an advertiser wouldn't want their link to be seen? This isn't that complex: if the purpose of a paid ad obviously has nothing to do with attracting a human, it's probably link spam.

The iTunes Interface Is Illegal?

Just in case you need a bit more evidence for why software patents are a bad idea, we have Slashdot pointing out that Apple has been sued over the interface used in iTunes. Apparently, the UI design for a software media player was patented a few years ago. If you question how this is possibly patentable, you win today's prize... which, if you're in Europe, probably is that you'll be stuck with similar bogus lawsuits and patent shakedowns for the rest of your lives thanks to clueless politicians. Congratulations and enjoy...

More RSS Ad contradictions

How can a group of people say that they are seeing good response to RSS Ad's and another say that they are seeing terrible performance. The comments I have seen come from two separate parties both with high traffic websites. I will be curious to see how this all falls out. [Blog Consulting]

URGENT: Call your Senator RIGHT NOW or live with the Broadcast Flag forever!

I felt the need to put this on the site in full context from BoingBoing this is a direct and complete quote off their website.

From Boing Boing

We've heard rumors that the Broadcast Flag that Cory, the EFF, and a coalition of pressure groups have fought so hard against (and beat in the courts) will be sneaked back via an amendment to the giant Senate Appropriations Bill in a sub-committee at 2PM EST on Tuesday 21st. This week is Hollywood's last chance to ram the flag past Congress, and they're working hard to get it under the radar.

There's no time to write letters or start a media campaign: but folk in the states below have just enough time to warn their senators, who are all on the sub-committee. People of Alabama, Alaska, Hawaii, Iowa, Kansas, Kentucky, Maryland, Missouri, New Hampshire, New Mexico, North Dakota, Texas, Vermont, Washington, and Wisconsin - it's up to you!

There's a sample script after the phone list. Remember: be cool, collected and polite. Most of these senators won't know a thing about the flag, until one of them makes it a throwaway amendment tomorrow. Make sure their ears twitch when they hear "broadcast flag" today.

ALABAMA Senator Richard Shelby (202) 224-5744
ALASKA Senator Ted Stevens (202) 224-3004
HAWAII Senator Daniel Inouye (202) 224-3934
IOWA Senator Tom Harkin (202) 224-3254
KANSAS Senator Sam Brownback (202) 224-6521
KENTUCKY Senator Mitch McConnell (202) 224-2541
MARYLAND Senator Barbara Mikulski (202) 224-4654
MISSOURI Senator Christopher Bond (202) 224-5721
NEW HAMPSHIRE Senator Judd Gregg (202) 224-3324
NEW MEXICO Senator Pete Domenici (202) 224-6621
NORTH DAKOTA Senator Byron Dorgan (202) 224-2551
TEXAS Senator Kay Bailey Hutchison (202) 224-5922
VERMONT Senator Patrick Leahy (202) 224-4242
WASHINGTON Senator Patty Murray (202) 224-2621
WISCONSIN Senator Herb Kohl (202) 224-5653

"Hello, Senator _________'s office"

"Hi, I'm a constituent. [Remember: Only say 'I'm a constituent' if you really are -- if you're calling the Senator from _your own state_] I'm registering my opposition to the broadcast flag amendment being introduced in the Senate Commerce Justice and Science Appropriations subcommittee mark-up on Tuesday, and in full committee on Thursday."

(*** You can give your own reasons for opposing the flag here. Here's a sample: ***)

"The Broadcast Flag cripples any device capable of receiving over-the-air digital broadcasts."

"It give Hollywood movie studios a permanent veto over how members of the American public use our televisions."

"It forces American innovators to beg the FCC for permission before adding new features to TV."

"It will prevent fair use of copyrighted works: critical review, and use of material in distance learning"

"This is an important issue which will affect all Americans, and should not be inserted in a large bill, at the last moment, with no debate."

"Please oppose the broadcast flag amendment. My name and address are ___________________."

"Thank you for your time."

Thanks to Boing Boing

Speeding Ticket Avoidance

This is a very popular security-related field, and one that every driver is at least somewhat interested in.

This site is run by an ex-policeman, and feels authoritative. He places a lot of emphasis on education; installing a fancy radar detector isn't doing to do much for you unless you know how to use it correctly.

Here's a product that seems to counter the threat of aerial license-plate scanners.

This spray claims to make your license plate invisible to cameras. I have no idea if it works.

One final note: the ex-cop is offering a $5,000 reward for the first person who can point him to a passive laser jammer that works.

Follow The Money

Johanne Torres has some real Insight on what's happening with the Asian long distance traffic market ever since VoIP started gaining ground.

But when it comes to money, one has to ask where's it coming from with Skype chewing up so much of the VoIP bandwidth?

But Skype is a razor thin margin business right now as DG Lewis in a laser like way explains in this very insightful post about the money Skype is paying (or isn't) Global IP Sound.

Human eggs may soon be created from stem cells

Scientists have taken the first step towards creating human eggs and sperm in the laboratory using stem cells, making it possible of one day growing sperm and eggs artificially for IVF treatment, therapeutic cloning and medical research.

Although much work needs to be done before human sperm and eggs can be grown in a laboratory, the research could be an "extraordinary breakthrough" for couples, by allowing them to produce a child with a mix of their genetic material even if both are infertile. The treatment of developing eggs and sperm from stem cells, which can be taken from anywhere on the body, would also be less invasive than current methods.

Anna Smajdor, from Imperial College London, said the work opened a potential Pandora's Box. "The technique can be used to generate eggs from a man's somatic cells, [so] gay couples could have children genetically related to both," she said. "Single men could even produce a child using their own sperm and an engineered egg, opening the way to a new form of cloning. Women's fertility would no longer need to be curtailed at the menopause.

"These possibilities raise new questions about how we define parenthood and about how we decide who has access to these new technologies."

Via Scotsman and New Scientist.

Yahoo Search vs. Google and Technorati: Link Counts and Analysis

In what I'm sure will become a heavily linked to article, Tristan Louis offers up his recent analysis. I haven't had time to digest it fully, but his conclusions are:

• Yahoo! generally does a better job at indexing the blogosphere than Google does. We know they have been working hard to improve their index and here's proof that they are getting results
• Even if Google is the one with the motto about not doing evil, Yahoo! seems to be the one interested in giving equal opportunity to the little guy: smaller blogs seem to have a better chance of being recognized by Yahoo! than they do of being recognized by Google
• While the front page of Google advertises they are currently indexing over 8 billion pages, it is very difficult to find ways to support that claim via the link feature they are offering: this can be seen as confirmation that Google does not tell you about all the links it has in its index.
• Sure volume counts but in the case of search indexes, they may count against sites: if one is less likely to appear in Google than it is to appear in Yahoo! and the Google index is much larger than the Yahoo! one, then, if Yahoo! and Google had the same amount of traffic, a single blog could find itself receiving more traffic from Yahoo! than it does from Google. This would be due to the fact that each individual page in Yahoo! has more weight than it does in Google.
• The top 100 blogs have other 56 million links in the Yahoo!. That's a lot of links and clearly shows that links are the currency of the blogging world. It would be interested to get data that would help analyze how much interlinking exists across those sites.

Of course, that's the sort of stuff I like to read!

What has your experience been in using Yahoo! Search to find blog content?

Secret Service requests removal of flickr collage: Bush + Guns

Posted by jase_ on #mobitopia (irc.freenode.net)

Financial Times and Scientific American to Publish Stem Cell Research Report

New York, NY -- June 16, 2005 -- Financial Times and Scientific American will publish their first ever special collaborative report on June 20, 2005 entitled, "The Future of Stem Cells". This...

The Big Credit Card Theft

Trying to make sense of the massive theft of credit card numbers at CardSystems, ‘a leading provider of end-to-end payment processing solutions focused exclusively on meeting the needs of small to mid-sized merchants’, in which information on more than 40 million credit cards may have been stolen.

CardSystems itself has issued only a brief statement on its website (no permalink available) saying it had identified

a potential security incident on Sunday, May 22nd. On Monday, May 23rd, CardSystems contacted the Federal Bureau of Investigation. Subsequently, the VISA and MasterCard Card Associations were notified to alert them of a possible security incident. CardSystems immediately began a remediation process to ensure all systems were secure. Additionally, CardSystems immediately engaged an independent 3rd party to validate systems security.

Notice the careful language: It talks only of ensuring all ‘systems were secure’ — in the security industry this is like checking all the locks work while watching all the horses bolting off down the street. (And don’t the FBI work on Sundays? Why wait a day to let them know?)

Then there’s the question: Why wait almost a month to let us know? A separate story by AP quotes CardSystems as saying that

it was told by the FBI not to release any information to the public. The company says it's surprised by MasterCard's decision to go public.

Actually, not so, say the FBI: Another AP story quotes an FBI spokeswoman, Deb McCarley, as denying

that the agency told CardSystems not to disclose the existence of the intrusion. McCarley says the FBI told CardSystems to follow its corporate policies without disclosing details that might compromise the ongoing investigation.

In fact, a MasterCard statement suggests that it was they, not CardSystems, who first identified the breach:

MasterCard International's team of security experts identified that the breach occurred at Tuscon-based CardSystems Solutions, Inc., a third-party processor of payment card data. Third party processors process transactions on behalf of financial institutions and merchants.

Through the use of MasterCard fraud-fighting tools that proactively monitor for fraud, MasterCard was able to identify the processor that was breached. Working with all parties, including issuing banks, acquiring banks, the processor and law enforcement, MasterCard immediately launched an investigation into the breach, and worked with CardSystems to remediate the security vulnerabilities in the processor's systems.

In the meantime CardSystems was pretending it was business as usual, including an announcement on June 14 of a move into check processing, and posting job-ads for a ‘Software Quality Assurance Analyst’ to cover, among other things, ‘troubleshooting from operations, production, and outside vendors’ who can work ‘in a very fast-paced, high-visibility organization where priorities often change’. Indeed.

Anyway, the scale of the thing is pretty awesome: Softpedia quotes experts as saying

that this is the worst case of data theft in IT history. "In sheer numbers, this is probably one of the largest data security breaches," said James Van Dyke, principal analyst at Javelin Strategy & Research in Pleasanton, Calif.

And just how did the theft happen? Details are sketchy, probably because no one yet knows (the MasterCard software which identified the fraud did so by monitoring transactions, not the actual breach. In other words, they observed the stolen goods being peddled, not the actual break-in). According to another AP story, MasterCard has identified CardSystems as being ‘hit  by a viruslike computer script that captured customer data for the purpose of fraud’, but hasn’t given any more details. CardSystems itself is not talking:

="ltr">CardSystems' chief financial officer, Michael A. Brady, refused to answer questions and referred calls to the company's chief executive, John M. Perry, and its senior vice president of marketing, Bill N. Reeves. A message left for Perry and Reeves at the company's Atlanta offices was not returned.

Both Perry and Brady have been with CardSystems a little over a year.

The Chinese Really Are Coming

It started with low-awareness deals like 3Com’s partnership with Huawei. Then came the big whopper of a deal - Lenovo Group snapping up IBM’s PC business for $ 1.75 billion. Today comes news that Chinese appliance maker Haier is looking to make a bid for Maytag for $1.28 billion. Another whopper of a deal is in the making: CNOOC Ltd., China’s largest offshore oil and gas producer, may bid about $20 billion in cash for Unocal Corporation., the eighth-biggest U.S. oil company, an offer that could beat out Chevron.

And this just might be the beginning, according to my colleague, Paul Kahila, whose Business 2.0 story, Why China Wants to Scoop Up Your Company? in the June 2005 is the proving to be quite prescient. He predicted the Maytag-Haier tie-up in his story. “Often, it’s name recognition that Chinese companies crave, since a history of communism has left them relatively clueless about building brands. The prime targets? American brands and manufacturers, as well as distributors that peddle Chinese goods,” writes Kahila. Driving the trend: Chinese desire to lighten up on US bonds and loading up on corporate assets. Of course they are eyeing the fat margins the brand names earn in the US, and have decided that they no longer want to be “world’s factory.”

2.3 bln wireless subscribers by 2009

Nearly two-thirds of all new wireless users will be Asia. China and India being big part of the overall action!

China ETF update (FXI and PGJ)

There are two exchange-traded-funds (ETFs) that offer the opportunity to invest in China -- iShares FTSE/Xinhua China 25 Index Fund (ticker: FXI), and Golden Dragon Halter USX China Portfolio Index Fund (ticker: PGJ). For a discussion of the portfolios of the two ETFs see here. Below is a performance update:

FXI, PGJ year-to-date chart.
(FXI in green, PGJ in brown)

Since the beginning of Q2 (As of April 1, 2005):

Google Site Rank Mechanism Revealed!!

The Rise of Open Source Java

By tim Last year at OScon, I gave a presentation entitled What Book Sales Tell Us About the State of the Tech Industry. One of the conclusions I drew was that Java was in decline, as its share of total programming language book sales had dropped by five percentage points in the twelve months ending June 2004. Well, we just re-ran those numbers, and saw a startling reversal.
 

Drilling to the Earth’s Core

The 57,500-tonne drill ship Chikyu (Japanese for Earth) will soon be penetrating the Earth’s crust to the mantle. The mission, administered by the Centre for Deep Earth Exploration in Yokohama, hopes to retrieve samples from the mantle to study earthquakes, the history of Earth’s climate, as well as the possibility of deep-Earth life.

via Guardian Unlimited

Using Wikipedia entry as a pandemic-prevention clearinghouse

Cory Doctorow: An MD in the Canary Islands has decided to use Wikipedia's entry on Avian Flu as the central clearinghouse for breaking information on the virus, collecting and publishing info on pandemic prevention, mitigation and recovery.

The letter announcing this, sent to the Promed mailing list for the International Society of Infectious Diseases is here. Jamais Cascio's WorldChanging commentary on this is here. Link

Apple's Move: With Intel Against Microsoft

Robert X. Cringely explores with fascinating logic the serious possibility that Apple may be joining Intel in an all out battle against Microsoft. This is one true hot topic for anyone interested in the future of personal computing and one that could drastically change the way that the personal computer industry will evolve in the next few years. Apple’s Decision to Use Intel Processors Is Nothing Less Than an Attempt to Dethrone Microsoft. Read on……

Direct and Related Links for 'Apple’s Move: With Intel Against Microsoft'

Korea to Require All Video Be Rated Before Distribution Via Internet (Ernest Miller)

South Korea is going to require video distributed via the internet to be rated before it can be distributed, according to a report in the Korea Times (Online Video Clips to Receive Ratings). The purpose of the law is to reduce violence, which includes organized criminal activity, privacy violations and libel (something a bit lost in the translation, I think). In any case it will likely have a bigger effect in squelching free speech and amateur video. A couple of other aspects that seem a little strange:

To tackle online privacy infringement, the government is also considering making Internet users disclose their real names....The government will also urge people privately publishing gossip to register the reports as regular publications.

via Michael Geist's Internet Law News

Microsoft Censoring Blogs on MSN China

jdfox writes "The BBC is reporting that Microsoft is censoring blogs on MSN China. The words 'freedom', 'democracy' and 'demonstration' are reportedly among the words being blocked. But the article also points out that Microsoft is not the first corporation to censor content when the Chinese government requests it." Slashdot covered this story a few days ago too.

DirecTV update breaks stand-alone PVRs

Wired is reporting that an update to the DirecTV D10 receiver is causing problems for TiVo and ReplayTV owners. Apparently it's not always accepting commands sent over the serial port, causing some missed shows. The solution listed is to use the IR blaster, which can have the same problem as the one reported.

The conspiratorially minded think that this update is just an effort on DirecTV's part to get them to buy receivers with PVRs built in. A DirecTV representative responds "I can absolutely say this is not a tactic to get people to switch over to another receiver," which is just the sort of thing you'd expect them to say if there were a conspiracy.

TheFeature :: SMS Activism: Don't Call Us, We'll Call You

"These are not true bottom-up, spontaneous, grass-roots expressions of networked solidarity, nor even representations of groups willing to follow up on their stated convictions; they are simply instances of large numbers of people momentarily willing to take their orders from above."

Kids would rather txt than talk

According to a new global survey, today's teenagers would be lost without their mobile phones, but they would rather text than talk. Natalie Hanman rep