The Korean equivalent of the RIAA has forced Samsung to downgrade the MP3 playback quality of a new media phone. Korea's Association of Phonogram Producers had wanted Samsung to release its MP3 Anycall flip phone with music playback disabled for all but DRM-encumbered music, reports the Korean Herald. A compromise was where the MP3 would play shareable music, but at reduced quality. But it isn't clear if the launch will go ahead. The record label lobby group had threatened to withdraw content from carriers. Users can hear the high quality version for three days, then only the low-fi version can be played. Do you think this will catch on? Although smartphone system vendors provide rights-management hooks, and the Open Mobile Alliance has been investigating DRM, downloads from "illegal" P2P networks outnumber pay-for DRM music services by 260 to one. If the carriers want people to use the data services, they will need to convince the copyright holders to embrace more progressive compensation models: where the artists actually get paid. The lure of more money from music buyers may be enough to get the copyright holders to the table. ® Related story Why wireless will end 'piracy' and doom DRM and TCPA - Jim Griffin CPRM phones home
The European Parliament has voted to stop the United States from collecting passenger data on EU citizens. The US Department of Homeland Security had sought access to the flight data, based on PNR (Passenger Name Records) but also including the passenger's email address, and a compromise was reached in January, although details only leaked out earlier this year. Under the 1995 Privacy Directive, the Commission is required to "assess the level of data protection afforded by a third country in the light of all the circumstances surrounding a data transfer operation or set of data transfer operations". The MEPs resolution adopted by Parliament in a 229-202 vote, MEPs judged the level of data protection to be "inadequate". The MEPs pointedly note that there is no legal precedent for using PNRs for "public security" and that "in the USA, the protection of privacy is not regarded as a fundamental right. In the USA, only US citizens are granted the right to data protection." Through private database companies who frequently act as government contractors, the US has acquired driving and medical records of millions of Latin Americans. The MEPs rejected the January draft and want guarantees from the US that would allow passengers to correct their data, who exactly gets what information of for what purposes, and for how long, and the establishment of an independent appeals body. It's a non-binding decision, which means that the European Commission, which is appointed rather than elected, and which negotiated the agreement with the US, is not obliged to obey. However, MEPs say that they will appeal to the European Court of Justice, if the EC ignores the Parliament's decision. ® Related stories EU Commission plots global travel surveillance system Europe too? US acquires hundreds of millions of Latino citizens' data Commission agrees US access to EU citizen personal data Got a ticket? Get a record. EU-US data handover deal leaks Data on 10m Northwest fliers handed to NASA for 'testing' Commission agrees US access to EU citizen personal data EU rattles sabres over US use of airline passenger data US given direct access to data on EU airlines' computers
The music industry's war on file swapping has suffered major three setbacks in recent weeks, and today's rebuff by a Canadian federal court is only the latest tactical defeat. We're now seeing indications that not only are the legal threats not working, but neither are the carrots of "legitimate" music download services, which even after a year of hype, comprise less than half of one per cent of the "illegal" P2P downloads every day. Earlier today, the music industry's global enforcement body the IPFI, of which the RIAA is a member, said it is threatening to sue over two hundred file swappers in Europe. The IPFI has targeted 120 alleged P2P users in Denmark, 68 in Germany and 30 in Italy, using a combination of cease and desist letters, direct copy infringement claims and reports to the police, we reported. But in Canada, where 29 people have been targeted, the jihad has already hit a bump. On Wednesday a Federal Court judge ruled that use of the Kazaa P2P network didn't constitute copyright infringement, against the wishes of the plaintiffs, the CRIA (Canadian Recording Industry Association), which had sought to identify the users. "No evidence was presented that the alleged infringers either distributed or authorized the reproduction of sound recordings," Judge von Finckenstein decided. "They merely placed personal copies into their shared directories which were accessible by other computer users via a P2P service." The ruling is the third major setback for the music giants in recent days. A study released on Monday showed that peer to peer file swapping network don't harm CD sales, or at best, have a negligible impact. Professors Oberholzer-Gee and Strumpf concluded that it takes 5,000 downloads to reduce CD sales by one. A study conducted two years ago attributed the decline to lower production; music sales typically fall when the economy is doing poorly, and consumers have less discretionary spending. In fact, a 2002 survey by Forrester Research reached the same conclusion and urged the labels to monetize the P2P networks and increase playlists. Earlier this month, Apple said that its iTunes Music Store would miss its target of 100 million music downloads by between 30 and 50 million. This and similar services such as Napster are the preferred options of the pigopolists: but for every song purchased and downloaded from iTMS, 260 are downloaded from the P2P networks, according to the RIAA's own figures. And despite an avalanche of press for the new DRM-encumbered services, and the threat of fines, the number of P2P users is again on the increase. But most ominously of all, a survey by Ipsos-Insight reports that 22 per cent of US downloaders over 12 had bought music last year. Which shows that people have tried the new 'legitimate' online DRM music services and found them wanting. By emphasizing threats and litigation the music industry is risking a long-term backlash when different compensation models are eventually introduced. We wrote about two such models recently, from Jim Griffin and Professor William Fisher at Harvard, who discussed a range of flat-fee options. Both would involve de-criminalizing what the industry calls 'piracy' on order to ensure the artists get paid. Professor Fisher's detailed plans factor in a loss of 20 cent to download music sales. But if the industry is not losing sales to downloads, or if it's losing sales due to its own incompetence, the public is far less likely to want to compensate it at all. If the RIAA and globally, the IPFI, can convince us that they best represent artists in the digital age, they may be yet earn that role. But if the public concludes that the record biz is looking for corporate welfare, it may be a case of the boy who cried wolf once too often. ® Related stories Missing RIAA figures shoot down "piracy" canard File sharers not guilty of copyright infringement - Canadian judge Music biz takes P2P jihad to Europe and Canada Kazaa and co 'not cause of music biz woes', say Profs Why wireless will end 'piracy' and doom DRM and TCPA - Jim Griffin Free legal downloads for $6 a month. DRM free. The artists get paid. We explain how P2P file swapping back on the increase iTunes DRM cracked wide open for GNU/Linux. Seriously.
Baltimore, the failed e-security firm-turned cash shell, is to transform itself into a clean energy solutions supplier. Whatever that is. It has made lots of board changes to create "a world class energy team". Baltimore has £25m in the bank and, err, no experience in the energy sector. But it knows a good opportunity when it sees one, having researched sectors as diverse as plumbing and car-washing before settling on energy. Baltimore is currently under seige from Acquisitor plc, owner of 12.5 per cent of the firm. The private equity firm, which is seeking board representation and wants to take control of Baltimore, said the company's plans were "worse than could be imagined on every front. The ideal that having lost more than £1bn (of shareholder value) on one blue sky technology, the company should now invest its resources in another, is outrageous," according to the FT. Quite. Baltimore's board has lost the plot. It is time to hand back the money to shareholders and dissolve the company. ®
The European Commission is to back US government moves to stop China giving tax breaks to local chip makers. "We have a systemic interest in that it may be chips today but tomorrow [may] apply to other products where we do have an interest," an EC spokeswoman said, the International Herald Tribune reports. China this week said it will enter negotiations with the US, in response to an official complaint made by the US government to the World Trade Organisation. The backing of the EC will add more weight to the US's argument. This centres on a 17 per cent sales tax China imposed in 2000 on all semiconductors sold in the country. Such taxes are permitted by the WTO. However, China granted local manufacturers the right to claim an 11 per cent rebate on the levy. If they design the chips as well as make them, local manufacturers can claim a 14 per cent rebate. Neither tax break is open to importers. China joined the WTO in December 2001, after the taxation policy was enacted. Such preferential treatment for local firms is a violation of WTO rules against discriminatory treatment, the US government claims. Its stance it backed by the Semiconductor Industry Association (SIA), a trade body which represents US chipmakers. China currently imports more than 80 per cent of its semiconductors. Europe's chief chip maker, Infineon, is less affected than others, since it maintains a plant in China. Products from that facility qualify for the 11 per cent rebate. ® Related stories China agrees to US chip tax talks US asks WTO to rule on China's chip tax US tells China to drop chip sales tax - or else US chip industry to take on Beijing
The Carphone Warehouse is to acquire N Tel Com - a switchless reseller operating in Switzerland - for £13.3m. It will use the company as a springboard to enter other European markets, including Germany. Last year, N Tel generated revenues of around £18m and an operating profit of £2m from 44,000 customers. Carphone Warehouse said in a statement: "N Tel is achieving good organic growth in its own right and will continue to be run as a stand alone business, but we intend to enhance its long term potential by developing tariffs to be distributed through our Phone House stores that will reflect the new free calls initiative." The purchase comes hot on the heels of Carphone Warehouse's recent acquisition of Xtra Telecom giving it access to the Spanish market. Carphone Warehouse's results are out today. It reports a 30 per cent growth in mobile connections to 1.44m, and it added 146,000 new punters to its fixed line operation, taking the number of TalkTalk customers to 385,000. The introduction of free calls on the TalkTalk network, effective from today, is to be supported by a major marketing campaign. Carphone Warehouse reckons that this will help increase customer numbers to 600,000-700,000. Following the recent announcement of free calls among TalkTalk customers, Carphone Warehouse reckons it now accounts for three in ten of all Carrier Pre-Select (CPS) punters across the entire market. "With the launch of the free calls proposition, effective today, we anticipate that the rate of sign-up will accelerate further," said the company. Chief exec Charles Dunstone added: "Our fourth quarter trading performance has been a fitting end to a record year. The mobile market has continued to be buoyant and we have strengthened our competitive position within it. "In fixed line we have begun to shake up the UK market and are laying the foundations for growth across Europe. "As a result of our success we anticipate that full year profits will be at the top end of market forecasts, with earnings per share exceeding forecasts.” Carphone Warehouse is to open 200 new stores over the next year mostly in the UK, Spain and France. ® Related Stories BT fires 'gimmick' salvo at Carphone Warehouse Carphone Warehouse declares war on BT Carphone Warehouse in free call offer Carphone Warehouse buys Spanish telco
Episode 11Episode 11 BOFH 2004: Episode 11 "Didn't we just DO an inventory?" the PFY asks, looking through the pages of items which we're going to have to find and account for. "Yes, but that was an internal inventory - for the IT Department. This one's for the Beancounters." "And the difference is?" "Our internal inventory simply consists of us ticking off items as we locate them. The Beancounter inventory requires us to enter the serial number of the piece of kit with the supplied inventory number and description." "Why?" "To reduce the chance of 'shrinkage'. See, they check the serial number we supply against the one in their database - if they don't match, they know we've made it up and the piece of kit cannot be found." "And?" "And then they recommend a full and complete audit, A-Z of our equipment, complete with lazy beancounter overseer to sight every item and make sure it's legit." "Ah." "So, I suppose we'd better get down to it. Item 1. Alpha box, Inventory number 101211." "We haven't got an Alpha box." "No, I pushed it into the dumpster about 18 months ago during a cleanout, but couldn't be stuffed filling out an asset disposal form. So we'll mark that down as missing." "Won't that mean we'll have to have the A-Z audit." "Oh no. You need your 'missing' items. They'll expect something to be missing, and what they'll do is look at the unit's book value - which will be zero after all these years - and decide not to pursue it." "Ah, right." "Next. Anamorphous Solar Panels, two." "On the roof of my flat." "Missing." "But we only bought them last year - they'll still have a book value!" "Indeed. And the beancounter will think - the lazy bastards couldn't be bothered getting up onto the roof. Next Dell Server, 6600, four. Inventory numbers 330765, 330766, 334189 and 334190." "Computer Room," the PFY says . . . . "First one: HZT881S." "That's the service tag. They'll want the serial number, as that'll be what's in their database." "Oh. 39170708416." "Slower," "391 ... 707 ... 084 ... 16" "39170708416, Right. Next one?" "391..." . . . and so it goes, box by box . . . "Tape Drives, six, First Inventory Number 288907." "Wow!" "What?" "Look at the serial number on that baby!" "That's not the serial number, that's a dump of it's BIOS firmware!" I blurt hopefully." I'm not writing that down! What is that, 70 characters?" "...sixty... three," the PFY says, gazing intently at the number concerned "I think.. I might have lost my place there." "Ok, DAMAGED." "It's not…" >CRASH!< "Yes it is." "You can't break them all!" "True, we'll have to use the old list." "The old list?!?" "Yeah, the photocopy of the list we did last time." "Last time?" "A couple of years ago." "If we've got a list, why are we doing this?!" "Just establishing an alibi," I respond. "?" "The Boss has seen us in the computer room all morning, so when we're away all afternoon he'll think we're inventorising the kit in the comms rooms, etc., instead of at the pub." "Ah!" "So what do we do about the stuff we've bought since the 'old list'?" "We just change the entries in the beancounter's database to be whatever number we think up at the pub this afternoon." . . . two days later . . . "Just a couple of things," the beancounter auditor chirps, reading down his clipboard. "Solar Panels, two - you say they're missing." "Yes," I reply. "We turned the place over looking for them. Probably stolen." "Did you check the roof?" "The roof?" "Yes, where solar panels normally live." "Oh yes, you're right. That completely slipped my mind!" "Next, these tape drives - you list their serial numbers as... 3, 4, 5, 6, 7 and Damaged." "Is that what it says on the sheet?" the PFY asks. "Yes." "It must be the case then - we copied it off the units." "But no-one would use a single digit serial number!" "They might if they only made 10 of them," I point out. "Anyway, don't you guys keep records of serial numbers from the store when the kit arrives?" "Yes." "And?" "Well the database has single digits too, but there must be some mistake." "So you're complaining that our records match yours?!!!!" "I.... Well that's not the point. I mean look at this! >shuffle< UPS, Standalone. Serial Number: K-N-O-B,F-A-C-E." "Yes?" "It spells KNOBFACE!" "It doesn't spell anything!" I cry. "It's a serial code. SERIAL. The UPS before it was K-N-O-B-F-A-C-D, the one after it was K-N-O-B-F-A-C-F. It's just random. We were just lucky." "And I suppose... The UPS 20KVA really has a serial number of ALLBEANCOUNTERSARETOSSERS." "That's what's on the machine!" the PFY replies. "And the one before it was ALLBEANCOUNTERSARETOSSERR, and the one after it was ALLBEANCOUNTERSARETOSSERT?" "Probably," I say, "If it's serial. Maybe the makers just didn't like beancounters?" "I want to bloody see it!" "It's in a secure area, I'm afraid, we can't possibly allow it." "We'll see about that!" he snaps, grabbing my desk phone and punching out some numbers. . . . A couple of minutes later the Boss trundles in. "I've just been talking to the Head of Accounting," he says officiously, "and this man here is to audit ALL equipment with any query against it. You are to provide him with COMPLETE access to sight this equipment so that he can verify it's serial and inventory numbers." "I see," I respond. "Fair enough. What's first on the list?" "Solar panels!" he snaps. . . . "... all a terrible accident," I say to the Boss as the ambulance pulls away. "He bent over to read the serial number and slipped. Six floors into the recycling bin!" "We're very lucky all the cardboard was in there to break his fall," the Boss blurts. "If you say so." "He says you pushed him." "That's just the shock talking!" "He said there were no solar panels!" "Ridiculous! He's had a bump to the head." "I tend to believe him." "You take his word against one of your employees! I'll take you up and show you if you like!" The Boss eyes the bin with the newly "compacted" cardboard briefly. "No, I think that will be OK…" "What about you?" I say, to the Head of Accounting. "I... ah.. think everything is in order." "Because while I was up on the roof I found some more of the missing kit, and would you believe it, the serial numbers of all those are, coincidentally 'ALLBEANCOUNTERSARETOSSERS' too. I mean, what a coincidence. Would you like to check?" "No, no, I'm sure you're right." "Right, well, I'll have someone send the paperwork up to you this afternoon then?" ® BOFH: The whole shebang The Compleat BOFH Archives 95-99
ATI's last night reported solid second quarter figures with big gains over the year-ago quarter and a small rise in income over the previous three-month. However, it warned investors not to expect sequential gains going forward. Q2 2004 sales totalled $463.3m, down just 1.4 per cent on Q1's $469.7m, but up 47.8 per cent on the same period last year, when sales reached just $318.5m. Those revenues yielded a Q2 net income of $47.6m (19 cents a share), up fractionally on the previous quarter's $47.4m (19 cents a share), and significantly better than the $8.3m (nine cents a share) ATI lost during Q2 2003. Gross margins were down slightly sequentially, dropping from 35.9 per cent to 34.8 per cent. ATI's cash reserves increased $88.5m during the quarter to $468.5m. Looking ahead, ATI said it expects sales to remain flat during Q3, falling between $440m and $480m. This would still yield a big jump over Q3 2003, and if ATI can keep revenues flat rather than down, it will have held its head high through one of the business' traditional weak spots. The company is expected to release its next major chip, the R420, during Q3 and begin its shift toward the new PCI Express interface. ® Related Stories ATI 'drops pixel, vertex shader 3.0 support' from R420 ATI Q1 sales up 40% Nvidia next-gen chip 'to launch 13 April'
Microsoft is close to signing a licensing deal with the Jamaican government, which should bring rampant piracy in the public sector under control. Up to 50 per cent of Microsoft software used by the Jamaican government is unlicensed, according to a "highly placed source" of the Jamaican Observer. Private sector softare piracy in the country is even higher, running at 70 per cent, the Business Software Alliance estimates. The Jamaican government has not yet worked out how much it will have to pay Microsoft, but says it should lead by example. It is currently toughening copyright laws to provide remedies against software piracy. Microsoft is offering carrot rather than stick to the governments of developing countries. In recent weeks it has signed up Ghana and Angola for deep discounts in the education sector, sweetened further with free training programmes, and free Win2000 and Win 98 licenses for refurbed PCs, donated presumably by Western charities. ®
AMD is do drop its Athlon 64 performance rating naming scheme and replace it with a remarkably Intel-like three-digit model number. That, at least, is what AMD presentation slides suggest. Marked 'confidential', the slides have nonetheless turned up on French website Hardware.fr, itself citing a picture-less report on Chinese website GZeasy. The crucial slide in question appears after a few piccies of AMD Europe executive Dave Everett giving a spiel to an unknown audience. Whether the displayed slide is one of his, isn't known, and might well not be. The slide's language is poor - Dave is certainly more articulate than that. It notes that it's now essential that punters understand how AMD's chips line up against Intel's 90nm Pentiums 4. So now, apparently, the AMD Athlon 64 3400+, which is matched against the Pentium 4 560 running at 3.6 GHz, will soon be called the AMD Athlon 64 560+. And so on, throughout the rest of the Athlon 64 line. Got this far without twigging? Yes, it's an April Fool's gag, as the 1 April 2004 date on the original Chinese story reveals, but the French, reading the story late at night on 31 March didn't spot. Nor did a number of US sites who spotted the Hardware.fr piece early in their timezones, but long after it had already become April in the Far East. ®
Today is 1 April, which means two things: newspapers, websites and press releases are full of ridiculous stories designed to fool readers into believing that, for example, Samsung has invented a roboservant which can do the washing up, mow the lawn and clean the car; and newspapers, websites and press releases are full of ridiculous stories designed to fool readers into believing that within ten years Samsung will invent a roboservant which can do the washing up, mow the lawn and clean the car. The former is, of course, a manifestation of April Fool's Day. The latter, however, is something far more sinister. In the trade we call it "Spring Cyclical Cyberpunditry Syndrome" - a phenomenon whereby teams of analysts, awoken from a Winter dormant state by the distant fragrance of daffodils, begin the time-honoured ritual of predicting a future of technology-assisted domestic bliss for humanity. Yes, it's that time of year again when we can read with glee that the cybernetic Phillipino maid is just around the corner. She'll be just like the real thing, too: you can pay her peanuts, beat her with a stick and lock her in the shed at night. Marvellous. (Reader comments - Ed.) So, how do know all this? Well, first out of the blocks for the 2004 cyberpunditry season is Future Horizons, "Europe's leading semiconductor analyst". And on the future horizon are robots as a "mainstream consumer products within the next decade, providing a significant growth opportunity for the electronics sector". A Future Horizons' report contends that "the electronics industry is on the cusp of a robotics wave, a period in which applications are aimed at human labour saving and extending human skills. It states that the market need, technology and economical justification have coincided to create a new electro mechanical robot system." And here is the key prediction: "By 2010 the $59.3bn worldwide robotic market will equate to 55.5 million units made up of domestic robots accounting for 39 million units; domestic intelligent service robots accounting for 10.5 million units; professional intelligent service robots accounting for 5.8 million units; and accounting for heavy industrial robots." Thirty-nine million domestic robots? Have you gone mad? Either Future Horizons' analysts have never seen a robotic lawnmower in action, or they are in fact agents of the black helicopter-borne lizard people. Those of us with our eye on the ball know that the promise of a technology-supported, Utopian future is a hollow one. At best, we have the prospect of malfunctioning robobutlers crashing over the furniture and spilling our G&Ts on the automated stealth hoover; at worse, the terrifying reality that our cybernetic homes will one day turn on us, forcing humanity into a desperate, apocalyptic battle for survival across the nuke-ravaged wastelands of our once-beautiful planet. In the meantime, and while those of us who can see the black future with spine-tingling clarity stock our bunkers with food and munitions, we'd like to ask just one, simple question: amid all this talk of "domestic intelligent service robots", where is the one thing we were promised in the 1950s and have been waiting for ever since - the one thing we really want? In short: where's our bloody flying car? ® Related links The Rise of the Machines Fire-breathing buses threaten London Cyberappliances attack Italian village Spanish cyberkiosks claim second victim Cyberkiosk assaults Spanish teenager Cyberloo blast rocks Stoke-on-Trent Hi-tech toilet swallows woman Where's our bloody flying car? Swiss set to unleash flying car Reader flak brings down flying car India to levitate flying car Flights of fantasy Skycar crashes and burns? So, where is my flying car? Robots in the service of humanity US puts on pair of robotrousers Japanese unveil trumpet-playing robot Robot grunts tumble in race for $1m prize Message to House Robots: Be Stupid Robogrunt: the US military's plans for robot armies
The UK's new communications regulator has only been going for three months or so, but already it's involved in a row with the UK's dominant telco. Yesterday - marking its first 100 days in office - Ofcom confirmed it had begun an "urgent" investigation into BT's decision to scrap its standard rate over concerns that the move is anti-competitive. BT says it's done nothing wrong and is "confident that [its] new customer propositions are wholly in line with [its] legal and regulatory obligation". It is also bemused by Ofcom's assertion that the regulator was unaware of the price changes. In a speech to Westminster Media Forum yesterday, Ofcom chief exec Stephen Carter said that BT's tariff changes were a "surprise" - and one which he doesn't want repeated. "I have to say this was a surprise. Between regulator and prime regulated, there is usually a no-surprises policy at a senior executive level. "For whatever reason, that did not effectively happen in this case. Whilst this lack of pre-disclosure will not affect our decision, I have to say this was a surprise. "We have strongly encouraged BT to avoid any such repetition and welcome their agreement to that policy." That's not exactly how BT sees it. The telco insists it did tell Ofcom of its plans. Said a BT spokesman: "We had a meeting with Ofcom on February 25 when we presented our plans. We feel that we've fulfilled all our legal and regulatory obligations." So we put this to Ofcom. A spokesman there told us that BT "did not share with us the detail of the plans - had they done so then the discussion would have been very different." Heavens above - if they can't even agree on what was said, what hope for future relations? One last thing. Mr Carter went on to say: "Needless arguments with the Regulator are good for no one, least of all the industry being regulated." That's not strictly true. There's nothing better than a good old-fashioned bun fight. Bring it on. ® Related stories Ofcom starts 'urgent' investigation into BT tariffs Centrica mulls legal action over BT tariffs Ofcom to examine BT tariff change BT simplifies tariffs BT dominance 'unacceptable', say MPs
A paediatric nurse dismissed for viewing online hardcore pornography at work has escaped being struck off the Nursing and Midwifery Council’s (NMC) professional register. Steven Truscott was sacked from his job at the Middlesex Adolescent Unit after committing six offences of serious misconduct during March 2002. The subsequent NMC caution he received was considered unduly lenient by the Council for the Regulation of Healthcare Professionals (CRHP), which went to the High Court seeking a new hearing and harsher punishment. However, the High Court judge, Mr Justice Collins, ruled that the NMC’s caution was not unduly lenient: "Accessing adult pornography is not criminal, and the circumstances in which Mr Truscott accessed it demonstrates poor judgement. It fully justified his dismissal." Justice Collins would not allow the CRHP to take the matter to the Court of Appeal and further instucted it to pay Mr Truscott and the NMC's legal costs. The caution will remain on Mr Truscott's record for five years. ®
April FoolApril Fool **Exclusive** Matt Drudge later today will report that a man and woman dated, sources tell The Register. An intern on the fringe of the John Kerry campaign once dated Kerry's Finance Director Peter Maroney. When pushed by The Register, top sources within the Kerry machine confirmed the shocking news that the two staff members enjoyed dinners and possibly even drinks over the course of two months. This bizarre hetrosexual courting ritual could destroy Senator Kerry's bid for the White House, according to Kerry's rivals. Rumors about the controversial dating first reported by the Drudge Report ignited a behind-the-scenes campaign drama in which reporters tried to uncover what the couple liked to eat for dinner. The intern - Alex Polier - is said to have a flirtatious manner when eating steak and cabbage. At present, it's unclear whether other members of Kerry's staff date, but, if they do, you'll read about it first in this space. Attorney General John Ashcroft provided the official White House comment on the alleged dating. "When I lost an election to a dead man, I thought that was the most shocking thing that could happen," he said. "But this kind of flippant courting verges on the absurd. The American public can rest assured that every liberty will be taken to find out how many immoral daters are hiding within the Democratic party. "With family values already in such a fragile state, we must put an end to out-of-wedlock dating as soon as possible." In other news, the Drudge Report will report that Newsweek will report that BusinessWeek will report that Microsoft owns a monopoly share of the desktop operating system market, that Intel's Itanium processor is struggling, that Richard Stallman is a bit wonky and that the Earth travels around the Sun. It's unclear how these revelations will affect the Kerry campaign. Closer to home, investigative journalist Greg Palast told The Register that he has received confidential documents detailing a zesty romance between Matt Drudge and Vanity Fair columnist Christopher Hitchens. The Palast papers warn that the Druge Report could crumble if word of the relationship "gets out." Three people who have seen the documents confirmed the phrase "gets out." They also scratched themselves. Drudge fell for Hitchens after attending a stunning series of lectures on Thomas Jefferson given by the Brit. Their love of "Clintonian proportions" heated up after Drudge received a tattoo of Henry Kissinger "making sweet love" to Mother Teresa across his rump. The mural tat is said to cover a three-day romp between the oldies and really "gets Hitchens' blood boiling." "Big time." Developing . . .® April Fool
Digital music distributor MusicNet has opened a UK office ahead of the anticipated debut of numerous download services here over the coming months. MusicNet's two key customers are AOL and Virgin, which last month announced its plan to offer an Apple iTunes Music Store-style download service with content delivered by MusicNet. According to industry estimates, around eight new music download services are planning to launch in the UK this year, including Apple and Napster. MusicNet wants a slice of the action, and is here to pitch for business. It's up against some very well-established companies, in particular OD2 (On Demand Distribution) and the lesser-known DX3 (Digital Domain Distribution). DX3 lists Recordstore and Woolworths among its digital download retail partners. OD2's roster is rather more impressive. It lists HMV, MSN, Freeserve, Coke, Tiscali, the Ministry of Sound among its UK customers. It also lists Virgin Downloads, but that seems likely to change when Virgin Digital comes to the UK. Mooradian is MusicNet's Senior Director of Strategic Planning & Business Development. He's likely to have a good handle on the UK music scene having studied at the University of Kent in Canterbury. Prior to joining MusicNet, he was a senior music analyst with market watcher Jupiter Media Metrix. ® Related Stories Virgin to open music download service Recordstore offers MP3 and WMA tracks Sony music download service to launch in June Wippit preps 'EasyJet-style' music download scheme Napster schedules UK launch
US retail chain Circuit City is to buy online music retailer MusicNow. Terms of the deal were not disclosed, but the two companies said they expect the acquisition to be completed by the end of this month. Circuit City said it will not have a material impact on its FY2005 results. MusicNow will continue to operate under that name and provide music services to third parties, such as BestBuy and SBC Yahoo. It will also now fuel Circuit City's own download offering, provided via the Circuit City web site and from within its 600-odd North American stores. MusicNow was founded in April 1999 under the name FullAudio. It currently offers both Apple iTunes Music Store-style 99c a-la-carte downloads as well as the subscription packages it started out with. ® Related Stories MusicNet to deliver music downloads to UK Virgin to open music download service Recordstore offers MP3 and WMA tracks Sony music download service to launch in June Wippit preps 'EasyJet-style' music download scheme Napster schedules UK launch
Sonofon, Denmark's second biggest mobile operator, is joining Starmap, an alliance of Europe's smaller mobile telcos. Starmap used to be called the mmO2 Mobile Alliance, and consists of mm02 in the UK, Ireland and Germany, Amena of Spain, One in Austria, Pannon GSM of Hungary, Switzerland's Sunrise, Telenor Mobil Norway and Wind of Italy. These allies are trying to stitch together a seamless roaming experience which will keep business customers tied to partner networks when travelling overseas. This pitches Starmap against Vodafone, which has coverage pretty much everywhere off its own bat, and Freemove, an alliance of four big operators: Orange, T-Mobile, Telefónica and TIM, announced Monday. Freemove said it is in discussions with other operators about joining, but Sonofon's decision to plump for Starmap, shows that smaller players may prefer to play with companies of their own size. ® Related stories Operators tout FreeMove 'easy roaming' alliance Could DoCoMo be the saviour of MMO2?
Le Freeserve has at last confirmed that it is to change its name to Wanadoo. As reported by The Register yesterday, the French-owned ISP has decided to ditch the Freeserve name that's been with us since 1998. In a statement Wanadoo UK said it would inform its punters by email and letter telling them "the strengths of the Wanadoo brand and the benefits they can expect in terms of better value, a greater range of products and services and further improvements to service and reliability". There will be no change to existing Freeserve email addresses. Well, for the time being at least. The makeover will take place "before summer this year" but according to sources much of the work is to be completed throughout this month. By the way, if you wanna catch a glimpse of one of Freeserve's new ads, checkout this link to a Freeserve ad. Be quick, mind, before it gets pulled. ® Related stories Freeserve airbrushed from history Freeserve to sell capped, cut-price broadband
Just one in ten UK organisations consider spam a major issue, and a full third report the spam tsunami is having little or no impact on their business. Accordingly, the use of anti-spam filtering technology still the exception rather than the rule. A survey out today suggests that media attention on the spam issue is out of step with the severity of the problem on the ground, at least for now. But this may change - all indicators suggest spam volumes are continuing to grow, the Department of Trade and Industry's 2004 Information Security Breaches Survey reveals. Around 17 per cent of the 1,000 organisations quizzed reported that spam made up more than half of all the emails they received. Smaller companies tended to be harder hit by the problem than larger corporations. Andrew Beard, the PricewaterhouseCoopers advisory services director involved in the DTI survey, said: "Spam hits businesses in a number of ways - they can be victims when their email and network services are degraded, but they can also unwittingly contribute to the problem if they allow poorly secured mail servers to be used by the spammers as 'relays' to spread their messages to other organisations." Simon Perry, vice-president of security strategy for Computer Associates, added: "Spam affects more than just productivity. It also has a dangerous side to it. Some can contain viruses or malicious active code. Without the adequate anti-virus protection, critical data can be compromised." Despite the these risks, the use of filtering tools is still far from widespread. Only twenty per cent of UK small firms have deployed this technology, although the figure for large businesses is more than double this, at 44 per cent. In the case of smaller companies, cost concerns or lack of awareness of filtering technology may be holding up adoption of anti-spam technology. Among businesses in general, the feeling may be that the technology is still immature. Many of those polled believed ISPs should do more to choke spam at its source or that a levy should be applied to each email sent to deter mass mailing. The full results of the biannual 2004 Department of Trade and Industry's Information Security Breaches Survey will be launched at the InfoSecurity Europe conference in London at the end of this month. ® Related stories Blaster beats up British business UK.biz leaves door open to hackers MS takes fight to the spammers Big US ISPs set legal attack dogs on big, bad spammers AOL raffles spammer's seized Porsche External Links DTI Information Security Breaches Survey home page
A US man has been found guilty of sending over 825 million spam emails and faces a mandatory sentence of two to seven years' jail on 14 counts of forgery, identity theft, falsifying business records and criminal possession of a forgery device. Prosecutors claimed he was raking in between $60,000 and $70,000 prior to his arrest in May 2002. Thirty-seven-year-old Howard H. Carmack - aka the "Buffalo Spammer" - was the first person to be charged under New York's "identity theft statute" after "defrauding Internet service provider EarthLink and eight men from New York State, Ohio and Washington, D.C., by either fraudulently obtaining EarthLink accounts in their names or using their corporate email addresses to sell products". EarthLink's assistant general counsel Karen Cashion said that the conviction "puts spammers on notice that in addition to being held liable for millions of dollars in civil damages, they can also be sent to prison for their intrusive and illegal emails". Carmack is due to be sentenced on 27 May. His attorney says he will appeal the conviction. ® Related stories Earthlink brings down the Buffalo Spammer Buffalo Spammer arrested EarthLink targets 100 spammers AOL and Earthlink chase spammers through the courts
Hard disk manufacturer Western Digital today pledged that the confusion surrounding the supply of its ultra-quiet hard drives based on its new Fluid Dynamic Bearing (FDB) technology should come to an end this month. Within that timeframe, system builders and resellers will be able to order FDB-based drives from WD's bulk distributors and stand a very good chance of getting what they ask for. According to UK system builder sources, that's not what's happened to date. The gradual introduction of FDB into the country has left buyers in a lottery, with some getting the new parts and others getting older, ball bearing-based mechanisms. WD's plan has always been to replace the older drives with the new ones. For mainstream drives, it never announced that transition, WD Sales Manager Ian Keene told The Register. "With the standard Caviar SE drives, some have ball-bearings, some have FDB," he said. "We never announced or put it in the specification that it's going to be an FDB product." The upshot is that some OEMs ordering the drives got FDB units as a bonus, since they were only ever offered as providing WD's Quiet Drive Technology. However, for customers who wanted an FDB part, it was a different matter. One channel source told us: "We had shipment after shipment of the wrong drives. We wanted FDB parts but kept getting ball bearing drives. I had to make 20-25 phone calls over two weeks to get it sorted out." According to Keene, that shouldn't have happened. "We did create a new part number for those customers who specifically wanted an FDB motor," he said. "So for those customer who wanted FDB, we shipped FDB." Sources in the system builder community claim it didn't go according to plan. WD created new part codes for FDB units, but with the intention of deprecating them once all its drives were equipped with the new technology. Consequently, "the disties were not interested in including the new part number", one sources said. "Without talking direct to WD you wouldn't know what you were getting." The FDB indicator codes are a 'P' or an 'L' for a drive with a 8MB cache or an 2MB cache, respectively, in place of the usual 'B' or 'J' in the model code. So a 250GB Serial ATA drive with FDB and an 8MB cache is coded WD2500PD, or WD2500PB if it's an IDE unit. Without FDB, the part numbers would be WD2500JD and WD2500JB, respectively. Crucially, once all WD drives are based on FDB technology, they will revert to the old B and J model codes. Sources claimed the FDB part numbers were not listed on distributor web sites, leaving them little choice but to order Js and Bs, and trust to luck to get an FDB unit. Keene said their chances of doing so were good. "We completed transition at the factory in the December/January timeframe," he said. "Even if people bought a ball bearing model in the past three months, the chances are they got an FDB anyway." Keene admitted that the UK was not a priority market for FDB drives, unlike some Scandinavian countries, for example. There, he said, they are very keen on ergonomic and environmentally sensitive products. Here, price and capacity are the key criteria. Distributors were provided details of the new codes, he said, but admitted "sometimes that doesn't always get through to our customers systems" because of their focus on cost and capacity. Certainly, some channel partners have taken the new codes into account. Reseller Scan Computers, for example, distinguishes between FDB and non-FDB parts. Keene estimated that, now all drives now manufactured using the new technology, the UK channel should have sold out all ball bearing-based drives by the end of the month. ®
This article is essential reading for both buyers and suppliers of technology and discusses some key points for getting technology contracts right. Here, we focus on the supplier's perspective but, by definition, that also indicates important points for buyers. 1. Pre-Contract Issues (i) Do you need a contract? Whether you are a customer or a supplier of technology goods and services, you need an appropriate contract for every deal. Businesses, technology itself and (importantly) the legal background are all constantly evolving and this means that nothing is "standard". Also every deal has its own legal, commercial and financial issues. For example the relatively new trend known as utility computing (in essence meaning that customers share resources and suppliers charge customers only for resources actually used) is a change that will impact on technology supply contracts where a supplier wants to charge on a utility computing basis. So because of constant change you do need a contract and the contract must be appropriate to the circumstances. Any business that just signs on the dotted line is asking for trouble. (ii) Contract management The purpose of a contract is simple: to represent as closely as possible, in writing, the deal agreed between the parties. That purpose is lost if a contract is stuck in the filing cabinet and forgotten. Deals can change and often contracts should be treated as a work in progress and reviewed and updated. As a supplier you must be quite clear before you sign a contract on what the customer wants and who has responsibility under the contract. Are you as supplier taking responsibility for providing a system or services to the customer or does the customer's IT department want some control or total control (for example on procurement decisions)? Suppliers don't want to be in a situation where the IT department is telling you what to do but you have responsibility if it all goes wrong. Split responsibility can lead to disaster. (iii) Pre-contract Statements/ Written records Remember that pre-contract statements may become a term of the contract itself. Also any letters, memos and e-mails must be disclosed in legal proceedings if they are relevant to the issues in a dispute (even if they are marked "private and confidential"). Statements made in a pre-contract letter helped achieve success for a Taylor Walton client recently. The client was an advertising agency which bought a new agency management software package. The client did make clear in pre-contract negotiations that a number of functions were essential. The system failed to achieve these functions and our client issued a claim for a five figure sum being the purchase price and damages. An important argument for the client was that the supplier had confirmed in a pre-contract letter that the system would achieve the essential functions and that the letter formed part of the terms of the contract. Our client settled the claim and the supplier repaid nearly all of the purchase price. So, beware of "sales talk" before the contract is signed and of recording anything in writing that you would not be happy to read in a court of law. 2. The Contract (i) Offer/ Acceptance First things first. You need to be sure that your contract terms are part of the contract at all. The terms that are "on the table" at the moment you accept an offer are the only terms that apply. If you accept an order on the telephone, by post, by fax or on a website and do not make it clear that terms apply then the terms are probably not a part of the contract at all. Some very big companies fall into this trap: Kodak advertised £300 digital cameras on its website at a price of £100 for a few hours in 2002. Thousands of orders were placed by the time Kodak corrected the error. It was reported that Kodak initially refused to supply the cameras saying in correspondence that "all offers placed on the website legally constitute offers to purchase from us" and that Kodak was "entitled to accept or reject them". In fact it is reported that Kodak's website automatically confirmed receipt of the orders using wording that was considered to amount to legal acceptance. At least one customer threatened a lawsuit and Kodak ultimately agreed to supply the cameras. This is reported to have cost Kodak about two million pounds. For suppliers it is essential to clarify how and when orders will be accepted and contracts made. We have a free information sheet on contract making procedures - feel free to email me and I will send a copy. (ii) Services/ Price Reviews We often recommend that technology contracts allow some mechanism for making changes to the scope of services. Suppliers should consider how flexible they are prepared to be and the risks of flexibility. A straightforward example is, if the contract says that the supplier will service all the customer's offices and the customer opens offices abroad then the contract may become unprofitable. There was a temptation in the past for suppliers to shy away from detailed written service level agreements (or SLAs) on the basis that if no particular measure of efficiency was agreed in writing then it would be difficult for the customer to sue on unfulfilled expectations. Where the obligations of the supplier were not clear from the SLA the courts tended to lean over backwards to help the customer. There is an advantage to suppliers in agreeing a detailed SLA that confirms what is in and out of the box. Customers may prefer less detail and would usually be happy if the SLA says simply that "the supplier will supply all IT services required by the customer". A good SLA will reflect common sense project discussions and seek a balance of interests. Pricing may need to adapt to any changes in services or SLA's. In technology contracts pricing is often fixed price or time and materials. If prices are fixed over a period then price increases will need consideration (customers will often seek to limit increases to the rate of inflation or an agreed percentage). The answer may be an appropriate change control procedure in your contracts which can be used to vary the scope of services and pricing. Of course it is preferable that any change is at the supplier's discretion rather than the customer's. (iii) Specification If things go wrong, one of the documents a lawyer will look at is the specification as it should help to define in as much detail as possible the output required. If your contract includes a specification, get it checked by a technology lawyer. I am not suggesting that lawyers should get involved in considering the technical content of Specifications but they should at least check that the Specification is clearly a part of the contract. Our litigation team has advised on cases where one party wants to rely on the content of a Specification but couldn't because it was not a part of the contract at all. (iv) Intellectual property By intellectual property I mean valuable information and ideas, as well as the more familiar registered intellectual property rights (such as patents, trademarks, designs) and unregistrable intellectual property rights (such as confidence and copyright). A supplier should in all contracts (at the very least): (a) Protect any intellectual property that forms part of its core business. (b) Agree (at the outset of the deal) either ownership or at least a licence to use intellectual property developed during the course of the contract. That is particularly important if the development of the intellectual property is funded by the customer as there may be a presumption that the customer owns it. (c) Remember that there may also be third party intellectual property rights which are licensed to the customer. If so the supplier will need a licence to any third party intellectual property which it needs to access in order to supply services. Check that at least these three elements are considered in all technology contracts and there may be more: intellectual property can be one of the more complex parts of a contract. (v) Software licensing Customers tend to regard themselves as buying a perpetual right to use software. But suppliers will seldom (if ever) give an unrestricted right to use and exploit software. Suppliers should consider at least: (a) the scope of the licence granted (including the length of the term, geographical limitations, maximum users etc), and (b) the circumstances in which they may want to terminate the licence (for example breach of contract, insolvency or change of control of the licensee). In a recent case, a supplier supplied websites built from the supplier's proprietary template. The supplier's standard terms reserved intellectual property rights and granted only a non-exclusive licence to its customers. One customer complained of copyright infringement because a competitor was operating a virtually identical website which came from the same supplier. The customer had no grounds for a complaint because it did not own the copyright or have an exclusive right to use it. This was probably a case where the customer did not check or understand the meaning of the licence terms and shows that it is very important to consider what type of licence is right for the circumstances. (vi) Limitation of liability A limitation of liability is a ceiling on the amount of damages that can be claimed by one party for a breach of a contract or other failure by the other party. These clauses are important because they allow a supplier and its insurers to predict the maximum amount for which they will be liable if the contract goes wrong. Under the Unfair Contract Terms Act courts can consider whether a limitation of liability is reasonable and, if not, you will not be able to rely on it. A supplier wants limitations in the contract and he wants them to be as low as possible while still being reasonable. In order to pinpoint a limitation of liability that is appropriate to a particular deal and that is likely to be reasonable, suppliers should consider issues such as: (a) the level of the supplier's insurance coverage, (b) the scope of the supplier's obligations, (c) any agreed service credit/ liquidated damages, and (d) the likely cost of a failure on the customer's business. But remember that a court will consider all the circumstances when deciding if a limitation is reasonable. In the important case of Watford Electronics v Sanderson. The claimant, Watford Electronics sold computer products. Watford bought a new software system from Sanderson in February 1993. The software did not perform well and problems continued until 1996 when Watford gave up, bought a new system from a different supplier and claimed £5.5 million pounds damages (including loss of profits). Sanderson's limitation clauses limited its liability to the price paid for the system, (about £100,000) and excluded loss of profits. The Court of Appeal decided that both the clause excluding loss of profits and the clause restricting liability to the price paid for the system were reasonable for the following main reasons: (a) Watford knew of the limitation and had similar limitations in its own contracts. (b) The parties negotiated the price and Watford secured price reductions. (c) The parties were of equal bargaining power. The case law on limitation of liability is always changing and it is always wise to seek a technology lawyer's advice on limitations that are likely to be reasonable in the particular circumstances. We also have a free information sheet on excluding and limiting liability in business contracts - again just email me and I will send a copy. (vii) Liquidated damages An alternative to limitation of liability clauses are liquidated damages clauses. Under liquidated damages clauses, specified breaches of the contract will attract pre-agreed financial damages (e.g. if the system is down for more than 1 per cent of 1 year, we will pay you £x for each additional 1 per cent of downtime). Apart from the difficulties involved in agreeing a formula for liquidated damages and then monitoring the supplier's performance against which any damages are payable, the damages clause must be a genuine estimate of the loss that will be caused by a failure or the damages clause will be deemed to be a penalty and automatically void. Some customers tend to feel more comfortable loading all the risk onto the supplier, imposing harsh liquidated damages clauses and sitting back expecting the supplier to deliver in the belief that they can rely on the damages clause if it all goes wrong. This is not necessarily the best approach for a successful contract. Firstly as I just mentioned penalties are not enforceable anyway. Secondly the individuals on the ground actually delivering the services are not always aware of liquidated damages clauses and so they do not necessarily incentivise the supplier. And thirdly damages are rarely a substitute for having a system that works. (viii) Distance Selling In contracts made at a distance between a technology supplier and a consumer, there must be a distance selling regulations clause in the contract. Distance contracts include contracts made on the telephone or on a website. Under the Distance Selling Regulations consumers have a right to cancel most contracts. The right will last for seven days unless the supplier does not comply with the Regulations in which case the right to cancel will last for three months. (ix) Termination The supplier will want to exit the contract in certain circumstances (e.g customer's insolvency or breach of the contract (e.g. non-payment)). The contract must be clear as to how and when a party can terminate. Also think about what is required by both parties on termination. For example a terminating supplier may want to get back all its intellectual property and be paid immediately (rather than after the typical thirty days). (x) Data protection The Data Protection Act regulates how businesses can use personal data. Personal data is any information that can identify an individual (name, address, email address, financial details, photographs or CCTV images are all included). All businesses process personal data which commonly relates to customers, staff, suppliers and other business contacts. Along with the majority of organisations, many technology companies have yet to fully realise the impact that the Data Protection Act has on all businesses. It is more than four years since the Act came in to force, and many legal experts are predicting that 2004 is the year in which the initial leniency shown by the Information Commissioner will end and enforcement action will begin against businesses that do not comply. The Data Protection Act carries criminal liability and unlimited fines in some circumstances and should not be ignored. There remains a common misconception among businesses that some are exempt from the Data Protection Act. There are no exemptions from the Act at all (there are exemptions from small parts of it such as going on the register) but not from complying with the Act. Even MI5 has to comply. Taylor Walton supplies a data protection audit service which is free of charge in most cases, again email me if interested. But for the moment a couple of matters of relevance to technology suppliers: (a) If a supplier is able to access any personal data held by the customer the Act requires that there is a written contract between the customer and the supplier requiring the supplier to maintain appropriate levels of security. One example of this situation might be where the supplier has access to the customer's client database for the purposes of supplying IT support or outsourced services. (b) If any personal data is to be sent outside of the European Economic Area then this must be either with the consent of the individuals concerned, or to an EC approved territory or under EC approved contractual clauses. Although the Act is quite complicated and a bit of a maze, putting compliance measures in place is not as much of a headache as most people think. 3. Conclusions So those are some key issues which are often important in technology deals. It is not possible to consider in detail all important issues in a short article but here are a few key points to take away: (i) Clarify the output required at the beginning (what does the customer want and what can be achieved - more tests and pilots up front may delay delivery but could prove to be time and money well spent). (ii) Clearly allocate the risk under the contract to the party that is best able to manage it (and different risks may be best managed by different parties) and then importantly leave that party to manage the risk. (iii) Make sure the contract is flexible enough to allow changes to be worked into it as the circumstances develop (if technology changes, a supplier may want to ask "This is what my technology can do, is it useful to you?" and as the business develops a customer may want to say "My business processes are changing, please adapt the system/ services so that it supports a different process"). (iv) If it is appropriate to the particular project, incorporate an end to end project plan into the contract listing both customer and supplier dependencies and have regular review meetings. (v) Finally and most importantly you must have a good starting point for all deals (so your standard supply terms have to be robust). If you are starting from a good starting point then you should need less time, effort and cost to sort out each contract. Businesses without good standard contractual documentation could face expensive legal problems and suffer commercial disadvantage which competitors may be avoiding. Again email me if you have any concerns or feel that standard contracts need to be reviewed. Taylor Walton supplies a comprehensive range of commercial legal services. If you would like to discuss the content of this article or any other commercial matter, please email Mike Pettit or Tim Cook or call Taylor Walton on 01582 731161. © Taylor Walton 2004. All rights reserved.
An international trawl for the bottom-feeders of the Internet has dredged up 176 UK websites making claims that are "too good to be true", the Office of Fair Trading (OFT) reports. While this will come as no surprise to battle-hardened scam-spotters such as El Reg, the OFT is to be applauded for its efforts to expose these charlatans before some fool and his money are well and truly parted. The sweep was carried out by the OFT and 30 local trading standards departments as part of a 31-country International Consumer Protection and Enforcement Network initiative. The UK sites unearthed included "90 working from home schemes, 52 get rich quick schemes, 20 lottery scams, 15 free prize offers, and four sites offering educational qualifications". Some of the familiar lines of attack deployed by these were: a working from home scheme offering business opportunities that will significantly increase income, e.g. over £2,500 per month, without specifying how this is done and only provided mobile telephone numbers a lottery scam which provided no contact details but claimed '100% guaranteed, no risk of loss whatsoever...' a free prize draw offering '£3 a night for a luxury hotel accommodation' but consumers must send £49.95 obtain a Directory which contains discount vouchers. a 'get rich quick' scheme claiming that in 24 hours people could raise £198,000. Yes, it's all horribly familiar. Mercifully, the OFT confirms that those websites "identified by the sweep as potentially breaching consumer protection regulations are being pursued by local trading standards or the OFT with a view to taking further action". Good show. As for the international operation, it uncovered a total of 1847 sites. The OFT's Director of Consumer Regulation and Enforcement, Christine Wade, noted: "The internet is used by fraudsters who seek to take advantage of international boundaries to avoid detection. Cross border co-operation is therefore important for combating this area of consumer detriment." ®
Intel's can-do spirit paid off today as the company's Itanium processor officially beat out all rival processors in total shipments, according to the latest figures from IHoD (International House of Data). After more than a decade hawking the Itanic chip, Intel has managed to unseat IBM, Sun Microsystems and HP as the leading 64-bit processor vendor. The IHoD numbers show Intel now holds 51 per cent of the high-end processor market. A massive collection of IT executives celebrated Itanium's achievement at event today in San Francisco. "This proves that enough money and marketing can make anything possible," said Intel's CEO Craig Barrett. "To be honest, we were sweating the first ten or so years, but, at the end of the day, we knew Intel would own this part of the market that it rightfully deserves." Intel's server processor chief Mike Fister was a bit more modest. "I am the lizard king," he said. Michael Dell, HP's Carly Fiorina, IBM's Sam Palmisano and even Sun's Scott McNealy were all on hand at the Intel event. "Intel's success with Itanium confirms our hunch that invention is best left to the professionals," Fiorina said. "Did I mention our Adaptive Enterprise strategy?" Sun's McNealy admitted his company made a huge mistake by refusing to ship servers with the Itanium processor. McNealy announced that Sun will center its entire server line around the chip by the third quarter of this year. Sun will, however, support UltraSPARC-based systems through the end of the decade and provide two more speed bumps for the chip. "Itanium is like a hockey analogy and a car analogy rolled into one analogy," McNealy said. "It's the best of all possible worlds. That UltraSPARC thing was fun and all, but it really makes more sense for us to make all of our customers move their software onto Intel's really neat product." "Yeah, it is neat," said Dell. "Industry standard ecosystems are neat." IBM also plans to stop development of its Power processor. IBM and Sun had managed to fend Intel off for some time, relegating Itanium to the back rooms of a few universities and Microsoft campuses. IHoD, however, said that Itanium sales suddenly took off in the early part of this year, making both Power and UltraSPARC chips "irrelevant". "We used to think Itanic was just a science project," Palmisano said. "But now we see it as something much bigger than that. I mean it. It's really big - and hot. That excites us." After cutting a celebratory ribbon, Intel's Barrett declared this "the century of Itanium." Everyone present clapped politely. "Microsoft still sucks," McNealy said, as he left the event. ® April Fool
Bill Gates reiterated Microsoft's commitment to improving security yesterday in an email which charts the progress of the firm's two-year old Trustworthy Computing initiative. There are few headline-grabbing initiatives in Gates' 3,200 word missive - beyond a promise to host a series of security summits across the US later this year. But the email does a good job of summing up Microsoft's recent security-related announcements. Reading between the lines, we can see a shift in Microsoft's thinking on security. Beyond fire fighting Gates writes that "security is as big and important a challenge as our industry has ever tackled", and a problem that will not be licked overnight. "It is not a case of simply fixing a few vulnerabilities and moving on. Reducing the impact of viruses and worms to an acceptable level requires fundamentally new thinking about software quality, continuous improvement in tools and processes, and ongoing investments in resilient new security technologies designed to block malicious code before it can wreak havoc." He singles out four recent viral epidemics: Slammer, Blaster, Sobig and Mydoom. These show how viruses and worms can spread more rapidly than ever before. Blaster in particular shows the threats posed by malicious code are evolving. In response, software vendors have to make it easier for users (particularly consumers) to keep themselves secure. Unlike his colleague Steve Ballmer - who has a tendency to make Wild West analogies when talking about security - Gates has come to (correctly) describe the process of improving security as a process, and not a destination. Also, he has dropped the hostage to fortune he handed out when he promised to rid the world of spam within two years. That pledge was wisely discarded around the time of February's RSA Conference. Mostly harmless With two notable exceptions (biometric IDs and Windows vs Linux security), there's little to dispute in Microsoft's latest security manifesto. Microsoft motives for improving security are arguably entirely selfish (removing a possible barrier to sales). But if its efforts result in fewer zombie PCs, compromised Web servers and less spam, then that's good. Right? SP2 puts up more solid defences Chief among these efforts is Windows XP Service Pack 2. Due out in summer, XP SP2 promises far-reaching changes to improve the ability of Windows XP-based computers to withstand malicious attacks from hackers, viruses and worms. Features include: Windows Security Centre; automatically turning on Windows Firewall; browsing enhancements to Internet Explorer (providing far more control of ActiveX, for example); and automatic pop-up blocking. Security Centre will let users check the status of their firewall, anti-virus protection and automatic software updates from a single point. Microsoft also promises better file attachment handling in Outlook Express and Windows Messenger instant messaging, a move designed to reduce the chance of users unwittingly opening malicious code. Buffer overflow slaying Most significant off all in the longer terms is revamped memory protection to prevent buffer overruns, the perennial source of so many security problems. AMD already supports this technology with a range of its chips and Intel is also committed to introducing support in microprocessors due out from autumn this year onwards. With XP SP2 Microsoft is applying the security philosophy (secure by default etc.) it introduced with Windows Server 2003 to its three year-old client OS. That process goes both ways, it seems. Gates said Microsoft plans to ship security advances in Windows Server 2003 Service Pack 1 in the second half of 2004 that will include the server-relevant security technologies found in Windows XP SP2. This service pack will also remove older, unused technology in a bid to reduce the potential for vulnerabilities. Patches, patches, who’s for my lovely patches Gates continues to trot out a statistic, first mentioned by Steve Balmer, which has been attacked as misleading by open source advocates. He says the number of "critical" or "important" security bulletins issued for Windows Server 2003, compared to Windows 2000 Server, dropped from 40 to nine in the first 320 days each product was on the market. Even if you accept this statistic at face value, patches are still a necessity of IT security, whatever the platform. Last November, Microsoft moved to monthly releases of updates to improve predictability and manageability. "We also are improving testing processes to minimize update inconsistencies and recall rates, and by this summer most of our updates will have full rollback capabilities," Gates writes. Passwords out – biometric in Improving authentication and access control is another key aspect as Microsoft’s security manifesto. Gates writes of the need to move away from passwords to more secure technologies like two-factor authentication and smartcards. "Farther out, a Tamper-Resistant Biometric ID Card system will provide an innovative, simple and affordable solution for providing cryptographically secure photo-ID cards using a unique combination of public key cryptography, compression and barcode technologies," he says. Active prevention Looking further ahead, Microsoft is investing R&D budget in developing "active prevention" technologies including application-aware firewall and intrusion prevention technologies as well as technologies that can dynamically adjust to an environment a user is working from. Intrusion prevention, along with SSL VPNs, are the hottest areas of the security landscape just now. But security vendors shouldn't worry too much because Microsoft's plans in this area remain vague, at least at present. On which note - there's still no indication about what Microsoft intends to do with GeCAD, the Romanian anti-virus firm is acquired last year. Education for free! In his email, Gates also stressed the need for user education. By the end of 2004, Microsoft aims to reach 500,000 business customers worldwide with information on how to optimise their systems and networks for security. Starting in April, Microsoft will host the first of 21 Security Summits in cities across the US, "intended to provide deep technical security training for IT and Developer professionals". This training will be offered at no charge (our emphasis), Gates promises. ® External link Gates' latest message to users on security Related stories MS bigs up Windows XP SP2 Beefed-up firewall, new version of Update for XP SP2 MS takes fight to the spammers Microsoft enters AV market Ballmer's new MS security fix - same patches, but 'nicer' Ballmer on why Windows is more secure than Linux Ballmer to crackers: this PC ain't big enough for the both of us
Vodafone looks be heading for a dispute with Customs & Excise over allegations concerning unpaid VAT. According to Reuters, Vodafone made use of a tax loophole regarding the manufacture of mobile phone cards which resulted in it paying less tax. Although not thought to be illegal, the Government is now cracking down on such tax avoidance schemes and wants the giant mobilephoneco to cough up around £15m. A spokesman for Vodafone told The Register that the company had sought a meeting with Customs some six months ago to discuss the matter. That meeting only took place this week. Vodafone is now considering its options and hasn't decided whether to pay up or contest the matter. A spokeswoman for Customs declined to comment. ®
Improved enforcement of existing laws – rather than more regulations – should be a government priority in the fight against crime on the Net. The London Internet Exchange's (LINX) call for greater police resources in the fight against cybercrime comes as MPs prepare to hold an inquiry on whether Britain’s key computer crime law - the Computer Misuse Act 1990 - needs updating. The government is shortly due to publish its Framework Strategy for e-crime. LINX is the UK's main peering centre for ISPs, so its opinion carries considerable weight in the UK Internet industry. Where’s a policeman when you need one? Writing in a special Home Office edition of the magazine Public Service Review, LINX regulation officer Malcolm Hutty argues that the growing problem of e-crime is affecting public confidence in the Internet. "In the real world, ISPs are often the only support available for individuals and small businesses who are victims of crimes such as hacking, online extortion or denial of service attacks," Hutty says. "Sometimes ISPs are faced with customers who are victims of crime, deserving of police attention. However, there is no national body adequately resourced and willing to take complaints from members of the public. ISPs are forced to refer customers to their local police station, knowing that very often the crime is not local, it is too technical for local officers to deal with effectively, and overworked specialist units are unlikely to take substantive further action." As a result of these problems few reports of online criminal activity actually result in a police investigation. This is turn means the problem of cybercrimes - such as online fraud - are seen as less important than they really are. Hutty’s comments back up a call by Metropolitan Police Assistant Commissioner Tarique Ghaffur earlier this week for greater police resources in the fight against cybercrime. Legislative tangle It’s sometimes argued that more elaborate regulatory controls might reduce the need to go through the difficult and expensive process of investigating and prosecuting criminal activity. Such an approach has little likelihood of success, according to Hutty "This legislative approach is fraught with difficulty, risks producing attractive-sounding solutions of dubious practical relevance and is unable to answer the question of who is going to enforce the new rules,” he writes. For example, Hutty notes that attendance at the Home Secretary's Taskforce on Child Protection on the Internet outnumbers the manpower at POLIT (the police group responsible for addressing online paedophilia at a national level). “The requirement for an adequate number of appropriately-trained police officers to investigate complaints of high-tech criminal activity is inescapable,” Hutty concludes. LINX is a founder member of the Internet Crime Forum (with participants from government, law enforcement, child protection groups and the Internet industry) and the Home Secretary's Taskforce on Child Protection on the Internet, as well as of the Internet Watch Foundation. ® Related stories E-crime costs UK business billions The rise of the white collar hacker MPs hold inquiry into UK computer crime law My sysadmin is a special constable UK ID theft gang jailed for £350K fraud External Links Malcolm Hutty's cyber-crime 'think piece' (PDF)
The Netsky worm beat off a strong challenge from various Bagle virus variants to top the malware charts last month. Message filtering firm MessageLabs blocked more than four million Netsky-infected emails in March. Netsky-C (2 million plus interceptions over the last four weeks) and Netsky-B (1.2 million). The other entrants in MessageLabs' Top 10 were insignificant by comparison. Bagle-J was the worst of the numerous Bagle variants released by VXers this month in a tit-for-tat conflict with the unknown authors of Netsky. Records of support calls logged by antivirus firm Sophos tell a similar picture. Almost three in five support calls logged by Sophos in March involved the Netsky worm. Netsky-D, alone, accounted for more than 30 per cent of support calls to Sophos. "The authors of the Netsky and Bagle worms have been battling for virus writing supremacy in March, with both releasing new variants in a tit-for-tat game of one-upmanship," said Carole Theriault, a security consultant at Sophos. "The Netsky author wins the dubious accolade of the month's biggest virus, accounting for almost 60 per cent of all reports to Sophos, but the biggest losers are the innocent computer users who have been caught in the crossfire of the Netsky/Bagle spat." Sophos added protection against 824 new viruses in March, bringing the total number of viruses it protects against to 89,112. ® March 2004 Virus Chart, by Sophos Netsky-D Netsky-B Netsky-C Bagle-C Netsky-J Bagle-E Netsky-P Bagle-H Bagle-J MyDoom-A Related stories War of the worms turns into war of words Netsky-D makes your PC go beep, beep, beep MyDoom and Netsky cause chaos Netsky author signs off Latest Bagle worms spread on auto-pilot
A project to catalogue and describe security vulnerabilities, derived from the ideals of the open source movement, opened to the public yesterday (31 March). The Open Source Vulnerability Database (OSVDB) aims to plug what it sees a gap in information security market. There are several vulnerability databases, but some are run by private companies, while others contain a limited subset of vulnerabilities or have significant restrictions on their content. “None are simultaneously comprehensive, open for free use, and answerable to the community,” OSVDB argues. To meet its objectives, the OSVDB project first concentrated on establishing a core group of project organisers, on creating the technical infrastructure to collect and validate vulnerability data, and on building a team of contributors to create open-source vulnerability records. All that took almost two years but now the database has been opened to the public. The OSVDB's main goal is to be "complete and without bias". A tough task, we say. OSVDB wants to be a comprehensive resource of vulnerability data for security product developers, sys admins, business people and academic researchers. Although it wants to be a "one stop vulnerability shop", OSVDB will reference other databases. Its own content will be free of cost and free of restrictions on use. The project intends to publish its guidelines on "ethical vulnerability disclosure" this quarter. These will include clear guidelines on the timing of notification to the product developer, and of notification to the open security community. How long vendors will have to come up with fixes to problems has yet to be decided. The OSVDB team wants to incorporate the organization under US law. The organization, tentatively named the Open Security Foundation, will be a private not-for-profit foundation. It is looking to recruit volunteer participants. An XML-formated version of the database, facilitating automated querying processes, is in the works. The OSVDB system will also prototype automated posting of vulnerabilities through an RSS-like push mechanism. Subscribers will receive each new vulnerability at the moment it is cleared into the database, and can choose to set customized filters to receive a subset of those records as needed. Both features are scheduled for introduction by the end of Q3 2004. The OSVDB will also help vulnerability-tool developers to identify vulnerabilities that are not already recognised by their products. More here. ® Related stories Conspiracy theories abound in security mailing list launch Symantec buys SecurityFocus, Riptech, Recourse
A group of tech celebs gathered on Capitol Hill this week to brief Congressional aides on how Congress and the Federal Communications Commission (FCC) can, and probably will, make a complete mess of the Internet in about a year's time. At issue are likely revisions to the 1996 Telecommunications Act and FCC regulations, which, thus far, have managed to do scant violence to the Net. Unfortunately, changes now being contemplated, urged by telecomms and media behemoths and their lobbyists, may soon alter that happy state of affairs. Broadband users are particularly at risk, because they enjoy little of the consumer choice available to dialup users. One can connect to a phone line and reach any of hundreds of dialup ISPs. Broadband users have no such luxury. The deregulation scam FCC Commissioner Michael Copps, who fought FCC Chairman Michael Powell's effort to ease regulations preventing the colonization of America's airwaves and print media by a handful of cartels, understands the crucial difference between deregulation and freedom. "Entrenched interests are already jockeying to constrain the openness that has been the Internet's defining hallmark, and they are lobbying the FCC to aid and abet them," Copps declared. "They claim all they are advocating is a deregulated environment where the market can reign supreme. But in reality, they are seeking government help to allow a few companies to turn the Internet from a place of competition and innovation, into an oligopoly. Power over the Internet would then reside with the network owners, who could use choke-point power to constrain consumer choices, limit sources of news and information and entertainment, undermine competitors, and quash disruptive new technologies." The Internet must remain device and technology neutral, and open, Copps warned. To illustrate, he pointed out that 35 years ago the phone company restricted the devices that could be attached and confined them to its own kit, using the excuse of ensuring quality of service. And then the FCC created a right of attachment, allowing consumers to hook up any device to the network so long as it caused no harm, and spawned dramatic growth in scores of industries. A similar regulation is needed for broadband Internet access, he hinted. Regulate the layer, not the Net Stanford University Law Professor Larry Lessig picked up this thread by speaking about the importance of keeping the Net technology-neutral and dumb, uninterested in what it happens to transport, and letting applications and devices at the ends develop the real smarts. Internet patriarch Vint Cerf then struggled to explain the network structure in language understandable by non-technical folks, with mixed success. He tried to show how the network is layered, and warned against regulation of the whole when a particular layer or protocol is all one needs to deal with. "The United States divides a lot of telecommunications services into different classes depending on not only the application, but also the underlying transport medium," Cerf explained. "So, voice over wire and voice over wireless, we regulate them differently. We regulate audio and video broadcast differently than [voice], and we regulate the cable television industry differently from the broadcast industry." The Net "destroys that whole model because it can carry anything, including voice and video, over Internet packets; and Internet packets don't care what the transmission medium is. So this [current regulatory] model is in conflict with the fundamental architecture of the Internet. "Since policy often has a direct effect on players, we need to know which layer in the architecture we want the policy to influence," he said. Bad faith The best speech came from University of Virginia Law School Associate Professor Tim Wu, who cited actual examples of industry abuse worth regulating against. He recalled broadband providers such as AT&T, that initially banned such devices as Wi-Fi routers, the use of which it called theft of service, even threatening subscribers with jail time for using them. Others have responded by refusing to offer tech support but offering their own Wi-Fi gear at additional cost. He mentioned as well that broadband providers, Comcast in particular, have restricted or banned the use of virtual private networks (VPNs). The idea here is to charge the customer as a business user, rather than a home user, and extort extra money. Servers and VoIP have also been banned in places, to protect other services that the provider offers. ® Thomas C Greene is the author of Computer Security for the Home and Small Office, a complete guide to online anonymity, system hardening, encryption, and data hygiene for Windows and Linux, available now at discount in the USA, and the UK.
April FoolApril Fool Comics have joked for ages that humans will eventually adapt to technology: growing nimbler thumbs for text messaging, or larger ears to compensate for poor signal reception. But in a remarkable breakthrough, scientists believe they have isolated the gene responsible for one specific kind of computer activity - and the race is on to commercialize it. It's an adaptive, emergent property - and is sure to ignite the Nature versus Nature debate once again. Biologists believe they have found the genetic adaptation responsible for 'weblogging'. The discovery may take the form of what Stephen Jay Gould identified as a 'spandrel' a previous adaptation for which evolution had found no previous use. Such claims have been made before, and have a dubious history. Late Victorian England was convulsed by the sensation of the "Hemel Hempstead Three". Three men - two of them brothers - had all developed extremely long legs - and all were Penny Farthing enthusiasts. The story was later proved to be a hoax. "It's all about me-me" Professor Teilhard, who holds the Poindexter Chair of Physics at the University of Santa Fe's Department of Extropian Studies, says that weblogging performs a harmless social function. "Webloggers are born not made," he said. "And shouldn't be persecuted." The activity could be a positive, group-bonding social function such as grooming, or simply a harmless way of passing the time, such as masturbation. Microsoft has employed over 400 webloggers in the hope of producing the elusive breakthrough, but now the race is on to find a commercial use for the discovery. Or any sort of use. Teilhard's breakthrough wasn't achieved overnight, and by interpreting some phenomena too literally, his team was led down several blind alleys. "We noticed the repeated occurance of the phrase 'arse feed' from one part of the sample," said the Professor. "Almost every member of the sample mentioned it once, but some members of the sample seemed to talk about nothing else." "We began to look for patterns - who was 'arse feeding' who. Was the 'arse feeding' bi-directional? There seemed to be no standard way of 'arse feeding' in the group - in fact we counted at least nine." "It was only after some months that we concluded that what they were talking about was 'RSS Feed'". For Teilhard, the breakthrough provides a vindication for his often-criticized methods after almost two decades of fruitless research. One fifteen-year experiment involved coating ants with invisible markers in the hope that the patterns could produce a text of basic English: such as an edition of Esther Dyson's technology newsletter. GMT However, the breakthrough raises serious ethical concerns. Is it right for parents to choose whether or not their child will be a weblogger? Can eradication of the gene provide a biological cure for solipism? But of more immediate concern, big business and the weblog industry are already eyeing the commercial opportunities. Infrastructure owners see the development as a way of using the excess capacity that was built during the dotcom era. Since the Internet bubble burst, millions of terabytes of data pipes, and thousands of formerly-employed HTML coders have lain unused. Investors hope that in around twelve years, when the first generation of genetically-enhanced webloggers is tall enough to reach a keyboard, the industry's demand worries may be over for good. Software developers in San Francisco have already trademarked what they describe as "Genetically Movable Type". The authors claim that while the free version, Movable Type, will continue, GMT will be packaged with specially formulated smart drugs to improve the weblogger's output. But the inventors are anxious to prevent the development of a 'black market' in GMT smart drugs. But they're likely to encounter a hostile European Union. "We're not convinced about the safety of genetically-enhanced Smart Blogging," an EU spokesman has said. The European Parliament has already voted to introduce a censure motion limiting the spread of GMT. Such concerns don't seem to have dampened the jubilation of webloggers. "Teilhard's breakthrough confirms that we are at the forefront of machine-human evolution," said one. Pressed for details, he replied, "I don't know what it means really. It's just a meme I felt compelled to transmit." ® April Fool