Legal – Page 21 – Digital-Lifestyles

Apple Avoids French Courts Opening FairPlay DRM

VirginMega, a joint venture between Virgin France and local media company Lagardère, has failed in its legal attempt to get Apple to license it DRM technology.

VirginMega claims that Apple’s refusal to license its FairPlay technology – the Digital Rights Management (DRM) system that allows songs from the iTunes store to be played only on iPods – is hampering the expansion of its digital music download market. The retailers complaint was ruled to be short on convincing evidence, according to the French Competition Council.

The problem, as VirginMega sees it, is that as its own online music service uses Microsoft’s audio files format (WMA) and is protected by Microsoft’s DRM technology, it isn’t supported by Apple’s iPod digital audio player. Since Apple won’t build WMA compatibility into the iPod, and as the iPod is the number one digital audio player worldwide, VirginMega is obviously miffed. Virgin wants Apple to licence FairPlay so it can incorporate the technology into the tracks it sells, thus making them iPod-compatible. The lack of compatibility between rival music services and players will certainly put VirginMega at a ‘disadvantage’, so it’ll have to look elsewhere to improve its sales to WMA-compatible devices.

Clearly Apple isn’t keen to share. Some feel that Apple may have shot itself in the foot here, as wider content support for FairPlay could help to drive the sale of iPods. By establishing AAC and the FairPlay DRM as a standards, more iPods would be sold and other standards, like WMA, would possibly be left by the wayside. Conversely if other music sites started using FairPlay, Apple would lose the relationship with the music purchaser.

Novell wins $536m settlement from Microsoft

Novell, Inc. (Nasdaq: NOVL) a leading provider of information solutions for enterprises, has announced an agreement with Microsoft to settle its claim that Microsoft’s unfair business practices harmed the sales of its NetWare computer operating system in exchange for $536 million in cash. Back in the ’90’s Novell was the prominent networking company. Novell also announced that by the end of this week it will file an antitrust suit against Microsoft in the United States District Court in Utah seeking unspecified damages in connection with alleged harm to the company’s WordPerfect application software business in the mid-1990s.

Novell believes that its NetWare business was damaged by unfair business practices that gave Microsoft’s Windows a stranglehold on the operating system market. “We are pleased that we have been able to resolve a portion of our pending legal issues with Microsoft,” said Joseph A. LaSala, Jr., Novell’s senior vice president and general counsel. “This is a significant settlement, particularly since we were able to achieve our objectives without filing expensive litigation. While we have agreed to withdraw from the EU case, we think our involvement there has been useful, as it has assisted the European proceedings and facilitated a favourable settlement with Microsoft. With the EU case now on appeal, we are comfortable with our decision to withdraw from the proceeding. There is simply not much left for us to do.”

The deal has resolved the NetWare matter between the two companies, but they remain at odds over WordPerfect. Novell acquired WordPerfect for $855 million in 1994 with the intention to launch an office productivity suite to compete with Microsoft’s Office. The effort failed, and, two years later, Novell sold WordPerfect to the Canadian software firm Corel for $186 million. Novell says that WordPerfect was victimised by Microsoft’s unfair business practices.

The suit is based in part on facts proved by the United States Government in its successful antitrust case against Microsoft. In that suit, Microsoft was found to have unlawfully maintained a monopoly in the market for personal computer operating systems by eliminating competition in related markets.

“We regret that we cannot make a similar announcement regarding our antitrust claims associated with the WordPerfect business. We have had extensive discussions with Microsoft to resolve our differences, but despite our best efforts, we were unable to agree on acceptable terms. We intend to pursue our claims aggressively toward a goal of recovering fair and considerable value for the harm caused to Novell’s business,” LaSala concluded.

Having been out of the news headline for a long time, Novell are making the most of their current time in the spotlight. With the headlines they are getting currently, they have synchronized the release of their new Office software, called Novell Linux Desktop (NLD), which runs on SuSE Linux. Initially focused to business users it is charged on the basis of a price-per-seat at $50. Using broadband connections, this could, in time be offered to home users.
Novell

Vodafone’s betting heavily on 3G this Christmas

Vodafone live! with 3G enhances Vodafone live! by providing customers with faster access to content and the ability to see more and share more with the use of video. The company’s 3G services will further add video calling, video messaging, a richer music experience, new games, as well as video clips.

A return on investment is critical for Vodafone, who has spent some £8 billion on top of the £14 billion it had to fork out for 3G licenses (Vodafone and its four UK rivals paid around £22.5 billion for the 3G licences). Of this investment, The Observer newspaper reckons that £8 billion has been spent on network infrastructure, with a little more going on R&D, and some £100 million earmarked for advertising. David Beckham will feature prominently as the mobile giant launches a pre-Christmas advertising blitz, promoting video downloads and other bandwidth-hungry services made possible by advanced colour-screen handsets and the higher connection speeds of 3G networks.

The new high-speed service uses a completely different network to the standard Vodafone live! service. The company has built it so that whenever you are outside a 3G service area, you will continue to access all the services, but the speed to access will be reduced. Video calling or streaming content will not be possible and the service will stop if moving off the 3G network. You should know when you’re in a 3G service area because a small 3G symbol will appear on the screen of your handset.

As well as content, 3G service providers will have to distinguish themselves with coverage. For instance, Vodafone claims about 60 per cent population coverage, but much of that will be in London and a few other metropolitan areas. Orange, which also plans to launch its 3G offering before Christmas, said its initial network deployment would be more extensive. Alexis Dormandy, Orange’s chief marketing officer, told The Sunday Times:: “We have a much larger, broader network because it’s supposed to be a mobile network rather than a ‘stay-in-one-place’ network.”

With such a big financial commitment to 3G, it’s vital that Vodafone has to get its 3G marketing right. Thankfully, it will be launching its service with no fewer than 10 mobile handsets (as we’ve covered), a problem Hutchison encountered when it launched its ‘3’ service a year or so ago.

Vodafone

Movie Studios to Sue File Sharers

The major Hollywood studios have vowed to sue people who illegally download movies from the Internet. In a similar move, to the way the Recording Industry Association of America (RIAA) is using lawsuits to fight online piracy (they have filed more than 6,000 lawsuits against file sharers since September 2003), the Motion Picture Association of America (MPAA) announced that the major Hollywood motion picture studios would be filing hundreds of lawsuits against individuals using peer-to-peer (P2P) file-sharing software to share films online.

Rather than embracing P2P technology by looking for new ways to generate revenue, such a lowering the cost of movie rentals and DVDs, Hollywood is intent on further imposing its iron fist on movie fans. However, help is at hand. In connection with the music industry lawsuits, the Electronic Frontier Foundation (EFF) has intervened in court to defend the privacy and due process rights of the individuals being sued, although it’s not yet clear whether the MPAA lawsuits will make similar actions necessary. Hollywood is pinning its hopes on federal legislation that would target file-sharing technology. If passed, the so-called Induce Act would close the legitimate-copying loophole and empower the MPAA to sue P2P file-sharing services such as Kazaa, Grokster and Morpheus.

The MPAA announcement comes on the heels of a recent study by the University of California, Riverside, and San Diego Supercomputer Center that shows that the music industry lawsuits have had no effect on the popularity of file sharing among US users, estimated at over 20 million. Movie studios can’t exactly argue that file sharing is about to put them out of business, as DVD sales grew 33 per cent last year and box-office receipts have never been stronger.

“These lawsuits are misguided,” said Electronic Frontier Foundation (EFF) Staff Attorney Wendy Seltzer, who has been involved in the music industry suits. “The music industry experience shows that the lawsuits don’t reduce the amount of file sharing. And it’s certainly not good PR to sue movie fans for non-commercial sharing when the studios are rolling in record profits.”

“In the end, what protects the studios from piracy is the what attracts people to buy or rent movies in the first place – a good product at a good price point,” said EFF Legal Director Cindy Cohn. “As long as you can rent a movie on DVD for $2, movie file sharing is not likely to take a major bite out of studio revenues.” www.mpaa.org

First Jailed Spammer Gets 9 Years

Thirty-year-old Jeremy Jaynes, a US citizen settled in North Carolina, has been sentenced to nine years in prison for sending junk e-mails with fraudulent and untraceable routing information. His 28-year-old sister, Jessica DeGroot, has also been ordered to pay a fine of $7,500 for buying domain names to use for spamming, although a third defendant, Richard Rutkowski, was acquitted of similar charges. Formal sentencing has been set for February next year.

Prosecutors said Jaynes and DeGroot took advantage of the Internet and America Online (AOL) members to sell bogus products and services, such as a ‘FedEx refund processor,’ which they claimed would allow people to earn $75 an hour working from home. According to evidence, Jaynes received 10,000 credit card orders, each for $39.95, for the ‘processor’ during one month alone. They were convicted under a Virginia state law that limits the number of e-mails mass marketers can send, and like the federal CAN-SPAM Act, forbids them from using fake e-mail addresses. Each was found guilty on three felony charges.

David Oblon, Jaynes’s attorney, was shocked at the severity of the sentence. ‘Nine years is absolutely outrageous when you look at what we do to people convicted of crimes like robbery and rape,’ he said. It’s been suggested that this ‘excessive punishment’ was because it was the first time the law had been prosecuted. However, during the trial, Jaynes was said to have accumulated a fortune of some $24 million by selling via spam.

The ‘harsh’ sentence shows the US is serious about spam, a nuisance to millions of users worldwide. But it’s also a major problem for large and small businesses because the thousands of unwanted e-mails can create havoc on company e-mail servers. Some surveys have even suggested that spam represents as much as three quarters of all e-mail traffic, despite laws in several countries seeking to curb unsolicited e-mails. Spam is believed to cost billions of dollars to businesses in software aimed at blocking the messages.

RIAA Files 750 New File-trading Lawsuits in the US & CD sales up 10%

The Recording Industry Association of America (RIAA), on behalf of the major record companies, has just issued a new round of copyright infringement lawsuits against 750 illegal file sharers using peer-to-peer (P2P) software. Including 25 users on 13 different university campuses, who used their university servers to perform the dreaded deed. This brings the total number of lawsuits filed by the RIAA against alleged file sharers since September 2003 to over 6,200.

The file sharers that were sued were using (P2P) services such as eDonkey, Kazaa, LimeWire and Grokster, although maybe Grokster miscreants will receive universal absolution if the deal between Grokster and Sony BMG to make file sharing respectable goes ahead. In keeping with practice used in previous cases, the RIAA suits have been filed against ‘John Doe’ defendants – a method used to sue defendants whose names are not known. They will instead be identified by their numeric Internet Protocol (IP) address. Names can only be obtained by music company lawyers’ issuing subpoenas to Internet access providers.

In addition to the 750 ‘John Doe’ litigations, 213 separate lawsuits were filed against named defendants who were already identified through the litigation process but then declined or ignored an RIAA offer to settle the case before it proceeded any further.

This is despite the fact, that legitimate downloading services seem to be doing rather nicely, with the RIAA’s recently released mid-year figures showing that 58 million single tracks were downloaded or burned from a licensed service for the first half of 2004.

Furthermore, the figures also show that full-length CD shipments to retail outlets increased by 10.2 percent this year, compared to the amount of shipments over the same time period in 2003 – the first time in five years that the first half of the year has experienced such an increase.

People are still flocking to the record store to buy their music, as overall, CDs and all other audio and video music products shipped to retailers increased by 8.5 percent in the first six months of 2004 compared to the same period in 2003.

It’s a funny thing that while all this litigation is going on, that the RIAA has just given out the first-ever Gold and Platinum awards for digital downloads, albeit for legally sold ones.

RIAA
Subpoena Defense site

BBC Creative Archive: Pilot to Start in 2005

More details of the BBC’s Creative Archive were revealed at an Royal Television Society, London Centre meeting last night when Paula Le Dieu gave a presentation on the project’s background and recent developments. Following this, an hour-long discussion, chaired by Digital Lifestyles’s own Simon Perry, explored further details [MP3 recording ~14Mb].

Paula is co-director of the Creative Archive (CA), a project to make BBC archived audio and video media available to the UK public so that they can download it and make creative works based upon it.

The BBC is taking this extraordinary step as they believe it will help them give more value to the licence fee payers – one of their core values.

Paula told us that one of the inspirations for the move was the BBC Micro. Released in 1982, the BBC Micro was an open hardware and software platform that ignited public interest and in no small way contributed to the UK’s hugely popular computing and games scenes. Indeed, by encouraging owners to use the BBC Micro platform in whatever way they wished, it helped many people take their first steps into the digital age and helped shape the industry as it stands today. A game of Elite, anyone?

Since then, we’ve seen the rapid growth of the Internet, and this has encouraged users to share content around the world – and the more material that people share, the more there is for them to draw inspiration from.

The BBC, slow on the uptake, came to the realisation that opening up their archive would allow them to present significant value to their public – enabling them to listen, watch, download, share and use materials in any way they wish, under an non-restrictive licence.

The remit of the Creative Archive has changed since the BBC’s previous Director General, Greg Dyke, left – Mark Thompson, the new DG, is completely behind the project and wants to include full programmes from the BBC’s huge media library. Give that some of the material that may be released has not seen the light of day since broadcast, it’s an exciting opportunity to give new life to content that has been sitting on shelves gathering dust for years. The BBC’s archive contains some 1.5 million items of television, equating to 600,000 hours of television – or put another way, 68 years of consecutive viewing. In addition to this is 500,000 audio recordings.

Obviously, that’s a lot of bandwidth – and the more popular the Creative Archive becomes, the more expensive it will be to distribute it. Consequently, the BBC is looking at peer-to-peer (P2P) methods of distribution, so that the public become not just their creative partners, but distribution partners also. The Corporation is also looking to the public for help in metatagging the content, after all people need to find what they need and know what they are looking for. Users of the content will be invited to tag content, and communities of interest will be sought out for their expertise on particular subjects. Paula gave an example of the Archaeological Society, who have already, of their own volition, tagged and catalogued all of the BBC’s archaeological output before the Creative Archive was even announced. Layers of metadata will be encouraged, so that content will be searchable in many different ways – for example, actors present, type of canned laughter – even types of shoes worn in a scene, and each layer will be open to peer review.

We feel this layering of metadata is of huge importance, an idea we have been putting to media owners for a long time. We feel the addition of descriptive metadata will be added to time-coded media with or without the owner blessing – it enables the viewing public to add their knowledge and experience, without limit of depth. It’s very encouraging to find that the BBC is to include this in CA.

New ways of using and accessing material require new licences. The Creative Archive team have looked at a number of alternative licences, and intent to distribute the content under terms based on the well-established Creative Commons (CC) Licence. Key requirements of content users will be that they properly credit the source and creators of the original materials, and that the new work they have produced inherits the same CC licence. All derivative works have to be non-commercial in nature – but of course a new licence can be sought for commercial use if required.

One aspect of the licence that needs work is a requirement that content is not distributed out of the UK. It is far from clear as to how this would be enforceable – web sites can be accessed from around the world, and one file downloaded from a P2P network may be assembled in blocks from a dozen countries. Any clip of interest to anyone will certainly be distributed worldwide within seconds of it becoming available. The provision has been built in because the UK licence fee is paying for the project, but it shows that the BBC is trying to tackle the new distribution problems that the digital age brings.

Because of content licensing within the BBC and the source of much of the materials in the archive, the Creative Archive’s material will be started off with natural history content – music clearance and artist’s rights will have to be tackled later before the rest of the archive is put online.

Andrew Chowns of the Producers Rights Agency raised the question of derogatory treatment of works from the CA. Depending on the content within the CA this could become a problem. Nothing spreads faster than a Friday afternoon joke video clip, and the Creative Archive will no doubt contain many items that regulars to b3ta and similar sites might find too tempting not to load into Premier and misuse. Again, this is an aspect that they will need to work on.

To enable the public to use the content, it will not be distributed with a digital rights management scheme and will be available in a number of formats, probably two proprietary and one open. Le Dieu described DRM as an envelope with a transparent window that only allowed you to see part of the content, without getting access to it.

She also stressed that the Creative Archive is not just about the BBC – they want other content providers and broadcasters to get involved, and want to share what they have learned, and have still to learn, with them. The whole project is very much a learning exercise for the Corporation – scary and exciting in equal measures.

The Creative Archive know that they have a lot of areas that need to be explored and developed and are looking for ways to involve the public in the project. Although there is no fixed start date, a 18-month to two year pilot will begin in 2005. It will not be restricted in the number of people who can access it, only in the amount of material that will be available.

The CA will not be producing a software platform or editing tools as they feel there are already plenty of free and cheap solutions out there. They may however produce an environment for the public to showcase works they have produced using CA content, much like those around Video Nation and One Minute Movies.

The Creative Archive is certainly an exciting project – an experiment in alternative licensing, another legal application for P2P networks and a chance for the UK public to get their hands on some fascinating and important archive materials. As a vehicle for learning about content distribution and consumption in the digital age, we can’t think of a better example.

MP3 recording of the Creative Archive Q&A ~14Mb
BBC Creative Archive
Royal Television Society – London Centre
Producers Rights Agency UPDATE: James Governor’s write up

Court Orders New Protections for People Targeted by RIAA

A district court in Pennsylvania has forced the Recording Industry Association of America (RIAA) to rethink the privacy and due process rights of people it has accused of copyright infringement. The impasse arose after the music industry filed a flood of lawsuits against anonymous individuals who they claimed were sharing copyrighted music, but because the industry did not know the identities of the file sharers, it served subpoenas to the individuals’ ISPs seeking their names. The court held that before the ISPs turn over these names, they must first send notices to each file sharer advising them of their rights.

The judge ruled that the RIAA cannot sue alleged file sharers simultaneously, since they had grouped 203 of them, called “John Doe” because their identities are not yet known – into one lawsuit last month. The RIAA must now identify alleged file swappers by their Internet Protocol addresses.

On Friday a subpoena was authorised in the case of John Doe No. 1, but the RIAA will have to make separate requests to seek the identity of each of the remaining 202 alleged file sharers, and must pay court fees of $150 for each lawsuit filed.

“Piracy, both online and on the street, continues to hit the music community hard, and thousands have lost their jobs because of it”, said Mitch Bainwol, Chairman and CEO of the RIAA in a recent press statement. The RIAA and its partners in the music community have continued a variety of public education efforts. These include joining with the FBI to unveil a new anti-piracy warning and seal; expanding the acclaimed “I Download…Legally” media campaign; and working with the university community to develop new programs to educate students about intellectual property laws, discourage illegal peer-to-peer use, and offer legitimate online music alternatives.

Notwithstanding, the RIAA, for the first time ever, included digital downloads in its semi-annual shipment report. For the first half of 2004, there were 58 million single tracks downloaded or burned from licensed online music services.

www.riaa.com
www.eff.com

Preminet: Nokia’s Mobile Content Move

Courtesy of Nokia, mobile content distribution and transaction will reside in a one-stop-shop, making life easier for mobile networks and perhaps more interesting for the owners of some 350 million Java-enabled handsets (at last count.)

Preminet is a hosted open service model that streamlines all the steps involved in delivering content for smart phones through a single channel.

As a result of an agreement announced yesterday between Nokia and Starcut, a Finland-based mobile media publisher, content from Universal Studios and Warner Music Group Content will be made available to operators and consumers through the one-stop content shop. Preminet and Starcut will provide operators with pre-certified content such as life-style and sports, ringtones, graphics, games and video that they can brand and offer over the Web, or via Java or Symbian OS enabled mobile phones.

Here’s how it works. Preminet sources premium Java and Symbian OS software from leading developers and content aggregators worldwide to give operators a master catalogue of certified applications, games and other mobile content. A chain supply experts dream system – the sequence includes the Preminet Master Catalogue, Preminet Service Delivery Platform and Preminet Purchasing Client, an innovative software application that make it easy for end-users to trial run mobile applications, content and services before buying. Operators can integrate Preminet content into their own download delivery systems or have Nokia provide a complete hosted solution.

Until now, each operator was responsible for maintaining hundreds of relationships with individual Java and Symbian OS developers as well as sourcing and testing each application before bringing them to the end-user. Now they have a single channel – the Preminet Master Catalogue containing a whole range of Java and Symbian OS software as well as a framework for delivering billing and distributing revenues.

In February, Nokia took one of its first steps towards Preminet when it joined with Sun Microsystems, Motorola, Siemens and Sony Ericsson Mobile Communications to create the Java Verified Process for testing and certifying Java 2 Micro Edition (J2ME) applications for wireless handheld devices.

Preminet is not a new concept though, coming after the Brew development platform for mobile devices from Qualcomm. Preminet has been launched worldwide and Nokia expects a complete commercial deployment by the end of November.

Time will tell as to how the mobile and content industries will react to Nokia taking this role on, and taking a percentage for each transaction in the process.

Preminet
Starcut

Lexmark lose DMCA-case

Lexmark can no longer use the Digital Millennium Copyright Act (DMCA), enacted by Congress in 1998, to stop its competitors from creating and selling cartridges that interoperate with its printers.

A federal court has ruled that a small North Carolina company, Static Control Components (SCC) can continue selling their Smartek chip that allows any printer cartridge to work with Lexmark printers. Or to put it another way, Lexmark, the No. 2 maker of printers in the United States, have learned the hard way that you can’t commandeer the Digital Millennium Copyright Act (DMCA) in conjunction with copyright law to create monopolies of manufactured goods for your company.

The decision lifts an injunction imposed by a lower court on the sale of Static Control Components (SCC) chips that allow any printer cartridge to work with Lexmark printers. Now, any company that wishes to compete with Lexmark in after-market cartridge sales can do so by using SCC chips in its products.

Congress originally intended the DMCA to prevent mass copyright infringement on the Internet. But some companies have been scrutinising the small print and using legal loopholes to gain control over after-market competition. Lexmark, for example, programmed its printers to require a digital “handshake” with cartridges, so that only Lexmark cartridges could be used. But when SCC started selling chips that allowed other companies to refill used cartridges and make them interoperable with Lexmark printers, Lexmark claimed they were engaging in unlawful reverse engineering and sued under the DMCA.

Under section 1201 of the DMCA, it is generally unlawful to circumvent technology that restricts access to a copyrighted work or sell a device that can do so. But Congress also included exemptions in the DMCA explicitly permitting activities such as interoperability, which permits reverse engineering, “for the purpose of enabling interoperability of an independently created computer program with other programs”.

Unfortunatley for Lexmark, they were unable to convince the judge that SCC was in breach of section 1202, while SCC were able to convince him that they were not in breach.

The now-normal model of very cheap printers and costly ink cartridges may be coming to an end.

SCC Smartek
Lexmark