November 13, 2006
Volume 15, Issue 7
The Travel 2.0 Answer: Media Switch
Les Ottolenghi, CEO of DCIA Member INTENT MediaWorks, will discuss rich travel media distribution, how to derive revenue from Internet 2.0 consumer traffic, and how major media and search companies can exploit rich travel media sharing in 2.0, at a special event this Monday afternoon.
Find out where the customers are and discover the media switch experience with INTENT’s "Travel 2.0 Switch Workshop" at the PhocusWright Executive Conference in Hollywood, CA from 3:00 PM to 4:30 PM PT on November 13th.
Understand how you can take immediate advantage of peer-to-peer (P2P) and social network applications that have been developed to address the needs of leisure, business, incentive, meeting, and group travel with Travel 2.0.
Learn about INTENT’s plans to launch MyTravelNetwork (MTN), which features technology for the new digital lifestyle and the world’s first social network totally dedicated to the travel lifestyle experience. Please click here to register.
QTRAX Signs Sony/ATV Music Publishing
Sony/ATV Music Publishing this week announced a digital distribution licensing agreement with QTRAX, distributed by DCIA Member LTDnetwork, the first ad-supported P2P music network, which is scheduled to launch early in 2007.
"We enthusiastically support QTRAX’s innovative new music service. QTRAX presents a unique and legitimate platform from which our songs may be distributed as broadly as possible, while at the same time securing potentially lucrative advertising dollars for our songwriters," said David Hockman, Chairman & CEO, Sony/ATV Music Publishing.
"We are thrilled to be involved with Sony/ATV Music Publishing. Their impressive catalog combined with their open-minded and innovative approach to new channels for music distribution make them an ideal publishing partner. As we put together the final pieces of the jigsaw to create a business that we believe represents the future of music, we recognize Sony/ATV Music Publishing is a critical piece in that puzzle," observed Allan Klepfisz, President & CEO of Brilliant Technologies Corporation, parent of LTDnetwork.
QTRAX has now signed content provision deals with GoDigital, Warner Music Group, The Orchard, EMI Music Publishing, EMI Music, TVT Records, ASCAP, and BMI.
Online Video Advertising: Hold on to Your Hat
Excerpted from eMarketer Report
If you have any lingering doubt that online advertising in the form of video is seeing explosive growth, consider this: spending on online video advertising will reach $410 million this year, 82% more than was spent in 2005. By 2010, Internet video advertising will be a $3 billion business.
Google, arguably the dominant force in online advertising, recently cast a vote of confidence in Internet video with its purchase of YouTube. But what factors will drive average annual growth of 64% in spending on Internet video advertising for the rest of the decade?
Two are clear: the great desire among companies and their agencies for targeted ad messages in a familiar creative format; and the obvious parallels with television, the long-favored mass medium, and the need to replicate that medium’s advantages on the Internet.
Another factor delivering high-percentage growth numbers is obviously the small base from which online video advertising has started. Phenomenal growth and an exciting development on the web, no doubt, but it is important to keep this trend in perspective.
Even with all the excitement, online video advertising will account for only 2.6% of this year’s $15.9 billion US online ad spending total. Spending on Internet video ads will account for 11.5% of all online ad spending in 2010, but it will still represent only 3.3% of TV ad spending in that year, according to eMarketer’s projections.
So, as with so many hype-fueled Internet trends, online video advertising cannot be ignored — but it must also be seen in the context of the whole advertising universe.
For more information, read eMarketer’s forthcoming report on online video advertising. Please click here to be notified when it is released.
Report from CEO Marty Lafferty
 The question we’ve been asked most often this week is, "What will be the impact of the Democratic midterm victory in the US Congress on commercial development of the distributed computing industry?"
With the caveat that it is impossible to predict the effects of this important change or the related Cabinet modification with total accuracy, we offer our recommended agenda for continued progress in the emerging P2P and social networking arena.
There are in fact certain parallels between our industry’s advancement and the American political scene.
The United States was a country formed by the people and for the people, and the Internet, which in many ways represents a modern-day technological manifestation of this nation’s democratizing principles, has been in increasing jeopardy of being stolen from the people by the actions of special interest groups.
Attempts to date that have relied almost exclusively on law enforcement to combat the enormous and steadily increasing file-sharing traffic that has resulted from consumer adoption of P2P software programs and social networking sites in advance of digital copyright solutions, have failed.
As on the Hill, it is time for a change in strategy from confrontation to collaboration. Monetizing P2P and social network traffic represents a much more worthwhile goal for all affected parties, including consumer as well as business interests, than continuing in vain to try to stop it.
For the first time since the DCIA’s inception, all of our Members involved in litigation related to MGM v. Grokster have settled their major disputes with opposing parties. And we are now engaged in a working group that also for the first time benefits from active participation by major content rights holders as well as P2P applications distributors and solutions providers.
From our perspective, the stage has been set for the broader issues of the digital realm to be addressed at last by private sector interests coming together to work with the 110th Congress. These include network neutrality, digital copyright, and consumer privacy.
Net neutrality will undoubtedly be revisited when Congressional attention again turns to our space, and new Democratic leadership will have the opportunity to avoid difficulties encountered by Republicans in trying to pass related legislation.
In this regard, we urge new leaders of the Senate and House Commerce Committees simply to block discriminatory actions currently being proposed by major Internet Service Providers (ISPs). Large ISPs should not be allowed to charge small Internet-based firms for faster delivery of their data.
Asymmetric network services, as proposed by ISPs, would end the ability of citizens to host their own web and e-mail servers, and terminate other productivity-improving applications. In effect, such a regime would oppress individual Internet users, sharply curtailing the freedoms they now enjoy on an even playing field with all other Internet users, including large corporations.
As important to our industry, of course, is digital copyright. With both user-generated content and increasingly varied genres of hybrid content, which integrate commercial copyrighted works with consumer-originated material, growing exponentially across all file-sharing media, this issue demands to be addressed sooner rather than later.
Rules for content monetization in the age of file sharing need to be updated before the P2P marketplace leaves both the technology and entertainment sectors hopelessly behind. New legal precedents need to be set and practical compensation models established for the redistribution of copyrighted works through the Internet – particularly those like P2P that can be based on advertising while at the same time accommodating a mix of subscription and paid downloads.
Promising new P2P models, such as burn-to-order compilations of classic movie sequels, TV program series, and music collections, stand ready to make long-tail marketing theories a profitable reality. At the same time, content protection and payment technologies stand ready to make day-and-date releases of the most valuable popular-culture entertainment economically viable for the P2P channel.
As social networks segment down to smaller sub-segments based on demographics and behavioral mindsets of group members, network operators will be able to charge a premium for delivering more targeted audiences to advertisers and content providers. That is, if we, in the private sector, in cooperation with Congress, preemptively address consumer privacy issues.
Complaints filed recently by consumer advocacy groups with the Federal Trade Commission (FTC) ironically underscore the fact that the capabilities holding the greatest commercial promise for file-sharing traffic monetization – online behavior tracking, analytics, and targeting – are also the subjects of such grievances.
For P2P and social networks to realize their greatest commercial potential, operators need to be able to more fully and appropriately exploit the integration of behavioral targeting with search-based advertising and content redistribution.
Behavioral targeting allows marketers to track and target potential customers based on their click-stream, thereby improving the odds of providing the right message to the right person at the right time. With P2P, push can be converted to pull as users actively seek search results of significant personal interest, making them more receptive to advertising messages than in almost any other circumstance online.
A critical key to maximizing the commercial value of these transactions lies in combining behavioral targeting with sequential search patterns that reveal consumer stages in buying cycles. But such advances will likely engender protests claiming invasion of privacy. And P2P and social network operators will probably bear the brunt of the blame for this.
Ultimately, however, business and consumer interests will be better served by working out acceptable ways for these technologies to be deployed. People will value accessing content on more attractive terms and enjoying greater functionality to a higher degree than maintaining a false sense of anonymity.
With new Congressional leadership from Senator Harry Reid (D-NV) and Congresswoman Nancy Pelosi (D-CA), we intend to continue our efforts to protect and advance the interests of consumers and the innovative companies represented by our Membership.
We look forward to working more closely with Senators Patrick Leahy (D-VT) and Daniel Inouye (D-HI), as well as Congressmen John Conyers (D-MI) and John Dingell (D-MI), in their expected roles chairing Senate and House Judiciary and Commerce committees respectively. Share wisely, and take care.
Web 2.0 Growing Faster than Online Video
Excerpted from Online Media Report by Mark Walsh
Web 2.0 sites make up the fastest-growing category on the web – doubling their traffic over the last year, according to data presented Monday by Nielsen/NetRatings.
At an Ad:Tech session titled "Web 2.0: Predictions and Pithy Analysis," Nielsen/NetRatings SVP of Industry Solutions Charles Buchwalter and Roy de Souza, CEO of ad-serving network Zedo, also offered analysis of the usage habits of Web 2.0 denizens and advertising on Web 2.0 sites.
Web 2.0 sites – defined loosely in the session as those allowing users to talk to their friends via e-mail, messaging, blogs, and other social media tools – ranked first in year-over-year growth in unique audience and web pages viewed. That put Web 2.0 ahead of categories including news and information, ISPs, video and movies, and family resources.
Social networking sites with the highest traffic growth included Feedburner (385%), Digg (286%), MySpace (170%), Wikipedia (161%), and Facebook (134%).
The Nielsen/NetRatings data also showed that engagement with Web 2.0 sites had grown over the last year, with retention rate increases of 10% at MySpace, 46% at Wikipedia, and 20% at Facebook. Web 2.0 users also tend to be more active than typical web users in online search, with 63.8 searches per month compared to 44.7 for the total market.
And while aggressive Web 2.0 users – people who make social sites part of their daily life, believed to account for 15% to 20% of the population – look at the same 17 news and information sites as everyone else, they’re more voracious but less loyal news consumers because of information retrieval tools such as RSS feeds.
Up-and-coming Web 2.0 sites that de Souza identified include Yelp, which has user restaurant reviews; Dogster, for dog lovers; online gaming community Xfire; Eons, aimed at baby boomers 50 and over; and video-sharing service BitTorrent.
The Net’s Next Phase
Excerpted from Fortune Magazine Report by Patricia Sellers
In early October, at Fortune’s annual Most Powerful Women Summit, blog queen Arianna Huffington, editor of the Huffington Post, led a panel called "Understanding the Internet’s Future," with Morgan Stanley Internet Analyst Mary Meeker, Motorola CTO Padmasree Warrior, and Marissa Mayer, Google’s Vice President of Search Products and User Experience. Though summit sessions are off the record, these panelists agreed to let us share excerpts from their lively conversation.
HUFFINGTON: You may not know that occasionally in a dry-suit Marissa Mayer snorkels off the coast of Iceland. And I’m delighted to have Padma Warrior here because I’m not on many panels where 50 percent of the women have accents. She runs a major operation. Twenty-six thousand engineers at Motorola report to her. Padma, I was at a conference recently where Bill Gates talked about a "reality acquisition device" that would tell us, for instance, the best restaurants, where our friends have eaten recently. What are you doing about this device?
WARRIOR: The Internet is still in phase two. Phase three will be about making it pervasive, where everybody in the world has access to it. To do that, there’s going to be a different kind of device. [She holds up a cell-phone.] At Motorola we call this "the device formerly known as the cell-phone." In the next ten years the Internet will follow you. It’ll be in your pocket, in your purse, on you.
HUFFINGTON: Whatever products Google is developing, they are incorporating a 60-to-70 percent failure rate. I find that utterly fascinating. Talk about that culture and how that translates into our lives.
MAYER: As we’ve grown, one of our challenges has been how we can continue to innovate. We have a theory around failing fast. If you assume that one in five things you do will turn out to be really successful, and maybe two of five will be moderately successful, and the other two will languish, you want to do a lot of things. It’s all about being agile. Most of the teams at Google are three to ten people. Five people launched Google News. About five people launched Google Toolbar. They operate like small companies inside the large company. Google is a lot like managing a VC firm, because you’re placing bets on different teams. Our organization mirrors the Internet. It looks more like a network than a hierarchy.
HUFFINGTON Mary, of all the different trends, what do you think is going to be the most impactful?
MEEKER: I’m never good at one, but I’ll throw out a few. Mobile is a really big idea. The reality is that the first computing experience for the majority of the world in the next two or three years will be on a mobile device. In 2006, 25 percent of the two billion mobile phones in use will be either 2.5g or 3g phones, which means that they’re broadband-enabled. The mobile market is kind of where the broadband market was two or three years ago. If we look at data-services global revenue for the mobile market today, it’s a $70 billion market. That’s really big. And if we look at just the personalized ring-tone, screensaver, music part of the business, that’s a $20 billion business globally - equal in size to the online global advertising market. That’s equal in size to Yahoo plus Google plus MSN plus iVillage, etc.
Video is also really exciting. One of the things I love about search engines is you get great satisfaction - except when you search for video. The number of times you search for and can’t get what you want is stunning to me. That’s the opportunity. By our observation, over half of all Internet traffic is peer-to-peer (P2P) file sharing. Most of that is video, and most is unmonetized. That’s a big opportunity.
The third thing - and then I’ll shut up: China has become the largest user of technology products and services in the world based on number of users. India will be the third-largest market some time in the next five years. When I started focusing on the technology market more than 15 years ago, I could go to Silicon Valley to figure out what’s going on. Now you have to go everywhere.
ISP Challenges and Expectations
Excerpted from WiMAX.com Report by Adlane Fellah
The primary challenge all operators face is satisfying the growing expectations of users for ever more capable, easier-to-use, and more universally available communications and broadband services. Whether the customer is a corporation or an individual user, the challenge is to make capital-intensive buying decisions to deploy wireless networks that will meet not just current demand cost-effectively but the needs of targeted customers for a reasonable return on investment (ROI).
WiMAX and cellular broadband provide a pathway to "personal broadband." The ultimate vision is for the ability to always be connected with a sufficient level of broadband service and simplified billing. Deploying and managing diverse wireless networks that deliver increased numbers of media and other services is complex. Both corporate and individual users have shown a willingness to pay for simplicity over more complex or multiple services. Several well understood factors fit into this equation, including ease of use and productivity: less time spent dealing with buying, paying for and learning how to use services and devices results in greater commercial benefits and user satisfaction.
WiMAX ushers in the opportunity for DSL, cable, and cellular operators to provide a single, extensible IP/SIP platform for delivery of wireless communications that include triple play IPTV, Internet access, and VoIP phone service. As WiMAX evolves to full 4G mobility, it will be capable of providing a full set of services when combined with local area DSL, cable, or fiber optics.
Optimizing network traffic and load balancing is key to ensuring adequate capacity across the network. Broadband-aware applications like P2P are complicating the load, performance and capacity equation. Initial P2P traffic, such as music downloads, resulted in megabytes of always-on traffic and dramatically strained network capacity. The growing popularity of Internet movie downloads is generating gigabytes of 24x7 P2P traffic, further impacting network capacity and convoluting planning for network operators. P2P traffic is exploding and outstrips every other communication and distribution protocol and continues to grow.
The implications of those P2P applications are numerous for broadband service providers. P2P applications will increasingly take a significant portion of their bandwidth. Further, P2P is symmetrical in nature, consumes an average of 80% of the upstream capacity and will affect QoS for all subscribers, even those that are not active in P2P. Therefore ISPs, including WiMAX service providers, will have to manage P2P wisely because they cannot afford to block or restrict P2P traffic.
The importance of managing P2P and maintaining quality of service (QoS) is evidenced by a recent study of Australian Internet users, whose implications can be generalized to other broadband users globally.
Australian Internet users most often left ISPs because they were overpaying (53%), their download speeds were too slow (44%), or due to poor customer service (33%). Today, users are most concerned with avoiding long contracts and attaining faster download speeds. While over half of the respondents said they were not comfortable committing to a contract for longer than six months, speed was the most compelling reason to choose a new provider, with 47% of those surveyed citing "constantly fast speeds" as their top consideration. Speed was also a big reason why users stay with a provider. It trailed reliability by less than 3 percentage points and led pricing, which came in third by a large margin in the list of reasons to remain with a provider. VoIP is becoming an important consideration, too. Nearly 30% of those surveyed reported that they use their broadband connection for VoIP service, almost double the number of last year. Of those, 20.6% use it as their sole telephony service.
P2P from Your Mobile Phone: Symella
Excerpted from CSS Weblog by Grant Robertson
This is just way too cool. Some researchers at the Budapest University of Technology developed a Gnutella client for Symbian based smart-phones. The client application, called Symella, supports multiple downloads, multiple sources per download, and a whole host of fairly advanced features for such a tiny platform. From the Symella site, "Symella is a basic Gnutella client for mobile devices based on the S60 platform. It is capable of searching and downloading, but does not upload any data in its current release. It supports multi-threaded downloads which means that if multiple users have a particular file then Symella can download the file from several locations simultaneously."
POGO File Sharing for Mobile Phones
POGO, a South African based company, has launched free file-sharing software for mobile phones and is looking to benefit from the growing demand for mobile phone applications in the youth market.
"The software application brings Internet-based P2P technology to mobile phones. This is the first commercially successful application of file sharing software in the wireless market," said Jaysen du Plessis, Managing Director of POGO. POGO allows users to share ring-tones, music, games, videos, and themes. The application also allows users to send messages at 1c per SMS as well as access classifieds, body weight calculator, and car performance facilities.
POGO is free and downloadable to all GPRS and 3G mobile phones that are Java and WAP enabled. The application is compatible with all phone types. Users just need to type in www.POGO.vg on their mobile browsers to get it. POGO does not bill for any use of the file-sharing facility and users pay only for the airtime to access the Internet.
"We have signed up 1,000 users in the three weeks since the launch of POGO. We are seeing significant usage of the application. Some 6,800 items, mostly music or games, have already been downloaded. Music downloads are the most popular content requests," stated Jaysen.
The free file-sharing software application provides users with access to a community sharing its content. 5,000 mobile games, over a million different MP3s, and thousands of ring-tones (including the current top hits) are already accessible via the file-sharing application.
According to Jaysen, additional content will become available as more users join the POGO peer-to-peer community. There is also a free instant messenger available for download that will allow users to send SMSs and chat in the mobile chat rooms. The instant messenger can be accessed at www.pogo.fm.
"We are expecting a rapid uptake of POGO as users become aware of the benefits of sharing content with their mobile phones. The youth market is particularly open to innovative means for accessing new content. Their demand for mobile content will drive the uptake of POGO in the market," Jaysen said.
For more information about sharing ring-tones, music, games, and videos with POGO’s free file-sharing software for mobile phones, please visit www.pogo.fm.
Skype Releases Stunning New Beta 3.0
Excerpted from iTWire Report by Alex Zaharov-Reutt
DCIA Member Skype, not content with crushing the rest of the telco and VoIP world with its massive mindshare and user base, has improved its software yet again and just released its latest version 3.0 beta.
Featuring even simpler and easier ways to talk to people, amongst version 3.0’s new features are community led-chat and discussion. There are also a series of enhancements to the "look and feel" of Skype, giving users instant access to the features they need, when they need them.
Henry Gomez, Chief Marketing Office & Director of Worldwide Operations at Skype, said, "With every release of our software, we want to give people the freedom to explore the boundaries of conversation and make Internet calling and ‘live’ online discussions the most natural thing in the world."
He continued, "We're introducing a number of new features with Skype 3.0 beta including Click-to-Call which lets users make calls to ordinary phone numbers when they are online. Click-to-call is so easy to use. For example, imagine you're searching online for a good place to eat and you find a restaurant and want to make a reservation. All you need to do is click on the number and you can make a direct call using SkypeOut."
The main list of features and benefits in Skype 3.0 include: Skypecasts and Public Chats which allow users to join in multi-person community conversations and discussions; Click-to-Call which lets users make calls to ordinary phone numbers with just one click when surfing different websites, using SkypeOut; a more powerful and personal user interface making it even easier to enjoy using Skype.
Please click on Skype Beta 3.0 to participate.
VeriSign Mobilizes Coke Machines in Austria
DCIA Member VeriSign, a leading provider of intelligent infrastructure for the networked world, will enable purchasing beverages at Coca-Cola vending machines via mobile phones in Austria. Over two million wireless customers will have access to the mobile payment function at such machines initially.
"As consumers are growing increasingly dependent upon mobile devices, mobilkom austria and ONE recognized an opportunity to provide compelling services that make everyday activities like buying a soda from a vending machine even more convenient," said Jeff Treuhaft, SVP, Digital Content Services, VeriSign. "We look forward to extending this cutting-edge mobile service and added functionality to wireless users around the world."
Making purchases by mobile phone is becoming increasingly popular around the world. According to the Yankee Group’s August 2006 report titled, "Mobile Phones Transform into Mobile Payment Devices," the global revenue for off-deck mobile payment transactions will rise dramatically during the next 5 years, increasing by more than 100% from 2005 to 2009, while the user base also expands from 65.5 million to 178.8 million during the same period.
Paying via mobile phone has already achieved some success in Europe and Asia, and the Yankee Group expects the trend to continue as mobile devices become more powerful and consumers use electronic payments for more transactions.
VeriSign developed the technical interface connecting Coca-Cola machines, cellular operators, and the payment system for the more than 100 beverage vending machines around Austria enabled for mobile payment. Developed in Austria, this solution can also be used for vending machines around the world.
Digital River Creates 350 New Jobs in Ireland
Excerpted from FinFacts Report
Ireland’s Minister for Enterprise, Trade, and Employment, Michael Martin, announced that DCIA Member Digital River, a global leader in e-commerce outsourcing, established a new European headquarters at the Shannon Free Zone to support the operations of its subsidiary, Digital River Ireland. The Irish subsidiary is expected to create 350 new jobs over the next five years.
Digital River, with corporate headquarters in Minneapolis, MN, builds and manages online businesses for more than 40,000 software publishers, manufacturers, distributors and online retailers. The company’s client list includes market leaders, such as Adobe Systems, Canon, CompUSA, H&R Block, Microsoft, and Symantec.
Martin said, "Digital River’s decision to establish at Shannon Free Zone adds significantly to Ireland’s emerging profile as a leading e-commerce business center in Europe. Digital River can be confident of finding highly skilled professionals and infrastructure of international standards in this part of the country. More and more companies are discovering the benefits of locating in regional centers throughout Ireland and Digital River is an example of the type of company we want to attract."
Digital River’s SVP of Global Operations, Tim McCauley said, "Our operation in Ireland represents an important part of our long-term strategy to expand our international footprint. By establishing an office in Shannon, we intend to provide added support for our growing base of international clients as well as increase our penetration in European markets. Key influencing factors in our choice of Shannon were a favorable business environment, a high quality of life for employees, and the support of Shannon Development."
Brits Keen to Download but Not to Pay
Excerpted from Variety Report by Archie Thomas
The number of UK consumers who want to download full-length films and TV shows to their PCs is growing, but they remain unwilling to pay full price for this content, according to a report published Monday by London-based law firm Olswang.
Olswang polled 1,500 13-55 year olds and found that while 40% of respondents are already downloading or streaming audiovisual content, 50% are unwilling to pay for this and a further 40% are not willing to pay more than $10 a month.
The survey also reveals a behavioral shift in the way consumers watch TV. Sky+, which allows subscribers to record content and watch it at their leisure, came in as consumers’ second most desirable device behind cell-phones.
Driven by a desire for increased choice of content and viewing times, interest in video-on-demand is growing: 38% of consumers, on top of the 12% who are already receiving VOD, state they are interested in receiving VOD on their television sets.
Viewing content on cell-phones still does not excite British consumers, according to the Olswang research: 90% of respondents have not yet streamed or downloaded any clips or trailers to their cell-phones and, of these, more than 70% stated they have no interest in this activity.
This distinct lack of interest is despite the launch of a range of cell-phone TV services in the UK in the past 12 months.
The report suggests the slow growth in demand for cell-phone TV is attributable to consumers desire for full-length content — not clips or trailers — and the perception that this full-form content is not really suited to mobile consumption, other than in cases where content is short but complete in itself, such as music videos.
Spanish Judge Okays Private File Swapping
Excerpted from Digital Music News Report
A Spanish judge recently ruled that file sharing is permissible for private, personal use, a ruling that quickly sparked industry reaction. Judge Paz Aldecoa of the No. 3 Penal Court of Santander dismissed a case against an unnamed defendant who had been accused of sharing numerous recordings.
Aldecoa noted that the defendant was merely engaging in a "widely practiced" and "socially accepted" behavior without profit interests in mind.
The decision, issued late last week, drew quick responses from Spanish industry trade group Promusicae, as well as the global label organization International Federation of Phonographic Industries (IFPI).
Spain has historically been a hub of file sharing, and the latest ruling will intensify that behavior. Over the past few years, piracy - at least as it was defined prior to this recent ruling - has allegedly contributed to a massive slide in CD sales. According to IFPI figures, sales of physical assets have dropped nearly 60 percent since 2001, landing at 34.6 million units for 2005.
Meanwhile, the ruling will almost certainly be contested though both legal and legislative channels. Still, the decision reflects a shift in societal thinking, a change that both the courts and lawmakers will be increasingly sensitive to.
Piracy Statistics Don’t Add Up
Excerpted from Australian IT News Report by Simon Hayes
Piracy statistics are labeled "self-serving hyperbole" in a draft government report.
A confidential briefing for the Attorney-General’s Department, prepared by the Australian Institute of Criminology (AIC), lashes the music and software sectors.
The draft of the institute’s intellectual property crime report, sighted by The Australian, shows that copyright owners "failed to explain" how they reached financial loss statistics used in lobbying activities and court cases.
Figures for 2005 from the global Business Software Association (BSA) showing $361 million a year of lost sales in Australia are "unverified and epistemologically unreliable," the report says.
Painting a picture of an industry seething with competitive jealousies, the report describes how "well-connected Canberra-based lobbyists" fight for government attention and police time on piracy.
Researcher Alex Malik, working for the AIC under a commission from the Attorney-General’s Department and IP Australia, was particularly critical of the use of statistics in court.
"Of greatest concern is the potentially unqualified use of these statistics in courts of law," the draft reads.
It says the manager of the recording industry’s anti-piracy arm, Music Industry Piracy Investigations (MIPI), did not know how piracy estimates were calculated, as that work was done by IFPI in London.
Many copyright holders claimed links between piracy and organized crime, but AIC researchers found nothing to support that view.
"It is inappropriate for courts and policy makers to accept at face value currently unsubstantiated statistics. Either these statistics must be withdrawn or the purveyors of these statistics must supply valid and transparent substantiation."
TV Station Backs Down on P2P Virus Claims
Excerpted from The Inquirer Report by Nick Farrell
A US television station has had to back down on claims that P2P software will fill your computer with viruses.
Denver, CO 7News reported how during its "exclusive" test it downloaded LimeWire only to find it contained password cracking software.
Inquirer reader Dominic Webb contacted the 7News hack, Tony Kovaleski, and called him out on his claim.
Sure enough, after a bit more digging it turned out the TV hack had got it all wrong and confirmed that LimeWire did not include any password cracking software.
"The error in my findings was the result of a unique license file downloaded by the installation of LimeWire on our computer. This license file is not a threat to a computer," Kovaleski said.
It turned out that his malware detector had triggered on a unique GNU license downloaded by LimeWire to 7News’ computer. This license had a "digital fingerprint" (SHA-1 hash) which was associated with only one application in a database of thousands of software products which turned out to be an older version of a password cracker.
LimeWire installed this unique license file on 7News’ system. Kovaleski established that it was this license which triggered the alert, not the installation of the actual application pwl9x.
The television company has since modified its "exclusive" story. Next week it might be writing a P2P gives you cancer story, so watch carefully.
Coming Events of Interest
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Future of Television Forum – This year’s event has been expanded to two days and will take place at NYU’s Stern School of Business, November 16th-17th, in New York, NY.
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VIP Networking Reception – November 29th at a local pub near ExCeL London, The Docklands, England.Sponsored by DCIA Member RawFlow. Please contact Ingjerd Jevnaker at +44 (0)20 7480 4220 for more information.
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Digital Hollywood Europe in London – November 29th - December 1st at ExCeL London, The Docklands, England. The DCIA will moderate two P2P panels featuring Anthony Rose, CTO, Altnet; Chip Venters, CEO, Digital Containers; Jonathan Friend, CTO, Friend Media Technology Systems (FMTS); Bruce Benson, Senior Managing Director, FTI Consulting; Les Ottolenghi, Founder & CEO, INTENT MediaWorks; Daniel Harris, Founder, Kendra Initiative; Daniel Klaus, CEO, Music Nation; Tom Meredith, CEO, P2P Cash; Xavier Casanova, CEO, Perenety; and Ingjerd Jevnaker, Marketing Manager, RawFlow.
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P2P MEDIA SUMMIT NY – February 6th–8th in New York, CA. The Winter DCIA Conference & Exposition will cover policy, marketing, and technology issues affecting commercial development of this emerging high-growth industry. Exhibits and demonstrations will feature industry-leading products and services. For sponsor packages and speaker information, please contact Karen Kaplowitz at 888-890-4240 or karen@dcia.info. Plan now to attend.
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