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Brownback Introduces Digital Rights Management Bill
WASHINGTON – U.S. Sen. Sam Brownback today introduced legislation vital for American consumers and our nation's educational community in the 21st century digital media marketplace – the Consumers, Schools, and Libraries Digital Rights Management Act of 2003. A portion of his statement follows. For the full text, visit his web site: www.brownback.senate.gov
"This legislation responds directly to ongoing litigation between the Recording Industry Association of America and Internet service providers Verizon and SBC Communications. This litigation has opened wide all identifying information an ISP maintains on its subscribers, effectively requiring ISPs to make that information available to any party simply requesting the information. The legislation also creates certain minimal protections for consumers legally interacting with digital media products protected by new digital rights management technologies.
"It has been determined by a federal court in RIAA v.Verizon that a provision of the Digital Millennium Copyright Act permits copyright owners to obtain an ISP subscriber's identifying information without any judicial supervision, or any due process for the subscriber. Today, right now, solely due to this court decision, all that is required for a person to obtain the name and address of an individual who can only be identified by their Internet Protocol address – their Internet phone number – is to claim to be a copyright owner, file a one page subpoena request with a clerk of the court, a declaration swearing that you truly believe an ISP's subscriber is pirating your copyright, the clerk will then send the request to the ISP, and the ISP has no choice but to divulge the identifying information of the subscriber – name, address, phone number – to the complaining party. There are no checks, no balances, and the alleged pirate has no opportunity to defend themselves. My colleagues, this issue is about privacy not piracy.
"The real harm here is that nothing in this quasi-subpoena process prevents someone other than a digital media owner – say a stalker, a pedophile, a telemarketer or even a spammer from using this quasi subpoena process to gain the identity of Internet subscribers, including our children. In fact, we cannot even limit this subpoena process to mainstream copyright owners. We have already witnessed the use of this subpoena by Titan Media, a hard core pornographer.
"The Consumers, Schools, and Libraries Digital Rights Management Awareness Act of 2003 requires the owners of digital media products to file an actual case in a court of law in order to obtain the identifying information of an ISP subscriber. This will provide immediate privacy protections to Internet subscribers by forcing their accusers to appear publicly in a court of law, where those with illicit intentions will not tread, and provides the accused with due process required to properly defend themselves.
"Digital rights management, otherwise known simply as DRM, refers to the growing body of technology – software and hardware – that controls access to and use of information, including the ability of individuals to distribute that information over the Internet. Over the past few years the large media companies have persistently sought out new laws and regulations that would mandate DRM in the marketplace, denying consumers and the educational community the use of media products as has been customarily and legally permitted.
"As a result, the Consumers, Schools, and Libraries Digital Rights Management Awareness Act of 2003 will preclude the FCC from mandating that consumer electronics, computer hardware, telecommunications networks, and any other technology that facilitates the use of digital media products, such as movies, music, or software, be built to respond to particular digital rights management technologies.
"The Act will ensure that anti-piracy policies for broadcast DTV will provide maximum protections for industry, but in a manner that relies on innovation, competition, and serving the interests of consumers to achieve that goal.
"First, the bill prohibits the Federal Communications Commission from moving forward with any new proceedings that impact the ways in which consumers may access or distribute digital media products, aside from the two previously mentioned proceedings. This will negate any future efforts by the major media companies to further expand the ways in which they can control how content may be legally used.
"Second, the bill sets ground rules for the FCC's broadcast flag proceeding. It permits the FCC, if it has such authority, to require consumer electronics companies to detect a Broadcast Flag and prohibit illegal Internet retransmission of digital broadcast programming to the public when it detects the flag. However, this proposal relies on a self-certification requirement, so consumer electronics and information technology companies can deploy competing and innovative DRMs that prohibit DTV piracy and not subject to the whims of industry gatekeepers. Like the Plug and Play agreement this proposal provides a meaningful role for the FCC, not industry stakeholders, to resolve any controversies that may arise with new technologies.
"In addition to addressing the threat of FCC tech mandates in the broadcast DTV space, this legislation also addresses other important concerns regarding the introduction of DRM into the marketplace, to prevent some of the experiences of consumers with this important technology to date.
"First, the bill provides one year for all stakeholders in the digital media marketplace to voluntarily devise a labeling regime for all DRM-enabled digital media products, including those made available solely online, so consumers will know what they are buying when they buy it.
"Second, the bill prohibits the use of DRM technologies to prevent consumers from reselling the used digital media products they no longer want, or from donating used digital media products to schools and libraries.
"Finally, the bill directs the Federal Trade Commission – our nation's premier consumer protection agency – to carefully monitor the introduction of DRM into the marketplace, reporting to Congress in incidents of consumer confusion and dissatisfaction, and suggesting measures that can ease the impact DRM has on law abiding consumers."
Sen. Brownback is a member of the Senate Commerce Committee, and is chairman of the Subcommittee on Science, Technology and Space.
OT The Mouse Trap
A mouse looked through a crack in the wall to see the farmer and his wife opening a package; what food might it contain?
He was aghast to discover that it was a mouse trap!
Retreating to the farmyard, the mouse proclaimed the warning, ?There is a mouse trap in the house, there is a mouse trap in the house.?
The chicken clucked and scratched, raised her head and said, ?Mr. Mouse, I can tell you this is a grave concern to you, but it is of no consequence to me; I cannot be bothered by it.?
The mouse turned to the pig and told him, ?There is a mouse trap in the house.?
?I am so very sorry Mr. Mouse,? sympathized the pig, ?but there is nothing I can do about it but pray; be assured that you are in my prayers.?
The mouse turned to the cow, who replied, ?Like wow, Mr. Mouse, a mouse trap; am I in grave danger, Duh??
So the mouse returned to the house, head down and dejected to face the farmer?s mouse trap alone.
That very night a sound was heard throughout the house, like the sound of a mouse trap catching its prey. The farmer?s wife rushed to see what was caught.
In the darkness, she did not see that it was a venomous snake whose tail the trap had caught.
The snake bit the farmer?s wife.
The farmer rushed her to the hospital.
She returned home with a fever. Now everyone knows you treat a fever with fresh chicken soup, so the farmer took his hatchet to the farmyard for the soup?s main ingredient.
His wife?s sickness continued so that friends and neighbors came to sit with her around the clock. To feed them, the farmer butchered the pig.
The farmer?s wife did not get well, in fact, she died, and so many people came for her funeral the farmer had the cow slaughtered to provide meat for all of them to eat.
So the next time you hear that someone is facing a problem and think that it does not concern you, remember that when the least of us is threatened, we are all at risk.
So what are you going to do when they come for you?
I don't think they've grown to multi-billion dollar in the last year or so...
JULY 8, 2002
THE STARS OF ASIA -- ENTREPRENEURS
Back to Main Story
Woo Jung Ku
Founder, Digitalway
In the glitzy and cutthroat world of global consumer electronics, Woo Jung Ku is something of a giant killer. In 1998, he and a bunch of former Samsung engineers launched Digitalway Co., a maker of MP3 players, which let users play music downloaded from the Internet or burn tunes off of compact disks. Since then, the company has grabbed 20% of the global market for the gadgets, making it one of the fastest-growing companies in consumer electronics.
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Woo, 40, is further proof, if any were needed, that Korea's ascendant economy is no longer full of copycat tech players who simply reverse-engineer Japanese product designs. Digitalway's line of hip, lightweight MP3 players--which can easily be worn as a necklace or snapped onto a wrist--has taken a commanding 30% share of the Japanese market, the home of mighty Sony Corp. Woo, who worked five years as a Samsung shipbuilding engineer before shifting to high tech, is especially proud of that fact. "I had to fight Sony," he says. "They are the big guys." He also has taken on big guys in the U.S. and Europe, where the company has a 15% market share.
Along the way, Digitalway has proved that profits need not be sacrificed at the altar of rapid market expansion. The company expects to report net earnings of $4 million on sales of $41 million in 2002, vs. $1.6 million profits on $24.4 million in revenues last year. Better yet, Digitalway isn't just an original equipment manufacturer that supplies MP3 players to others. Some 70% of its sales come from its own brands. Woo is thinking of taking his company public on the tech-laden Kosdaq market later this year.
To keep the growth going, Woo travels the world pursuing sales about four months out of the year. When he does have some downtime, he's likely to be trying to make a save or two in front of the goal in a pickup game of soccer. And the lanky Woo isn't above slipping on a pair of in-line skates and cruising the streets of Seoul.
But expanding Digitalway is clearly the main event. Next, Woo hopes to move into lower-end digital cameras and camcorders--important product lines, of course, for several Japanese behemoths. Watch out, Sony and Canon. Woo Jung Ku is after your business again.
Study: Europe's downloaders big spenders, too
LONDON (Reuters) — Europe's Internet downloaders are avid music fans who own multiple gadgets and are as likely to buy a compact disc as anyone else, according to new research released on Wednesday.
The image belies the notion of the slacker teenager trawling the Internet for free music to hoard. They are regular shoppers in record stores today, and they are very likely to buy song downloads in the future, the researchers said.
"There are strong music fans within the file-sharing community," Mark Mulligan, an analyst at Jupiter Research in London, told Reuters.
"They are more likely to listen to digital radio and visit artist Web sites. There is compelling evidence that this group is the bedrock community for those willing to pay for legitimate (online) music services in the future," Mulligan added.
The music industry has waged an all-out war on Internet file sharing and CD burning, which it blames for a three-year decline in sales of recorded music.
In the United States, the Recording Industry Association of America (RIAA), which represents the world's big five music companies, Universal Music, Warner Music, EMI, BMG, and Sony Music, has begun suing individual music-swappers.
In Europe, industry trade bodies and the major music labels have tried a gentler tactic, promoting industry-backed services and educating consumers that downloading copyright-protected media is an illegal activity.
Movies on tap in Europe
Europe's online downloaders differ from their North American counterparts, said Chris Colman, European, Middle East and Africa managing director of Canada's Sandvine, a technology start-up that works with Internet service providers to minimize the escalating bandwidth costs associated with file sharing.
European downloaders prefer services such as WinMX and eDonkey, which are havens for film, software and music videos. Services such as Kazaa, which runs on the file-sharing Fasttrack technology and are teeming with songs, are more popular in North America, Colman said.
North Americans and Europeans appear to be using peer-to-peer services for different purposes, but there is one constant: file-sharing usage is escalating as the market for high-speed broadband Internet grows, he said.
"We're finding that new broadband subscribers are sharing files earlier and existing broadband subscribers are sharing files more," Colman said.
Jupiter's data, from a survey of 5,000 Internet users this summer in the United Kingdom, Sweden, Italy, Spain, France and Germany, backs up Sandvine's findings.
According to Mulligan, 15% of Europeans surveyed download a movie each month from a free file-sharing service. Spain tops the list with 38% admitting to downloading a movie each month.
In contrast, a separate Jupiter survey of U.S. Internet users reported that 12% of Americans download a video file each month.
Mulligan, for one, says it would be a mistake for Hollywood and television executives to embark on a legal crackdown against this consumer segment, which could some day be a media company's best customers.
"I think there's definitely an opportunity for television companies and movie studios alike to harness an emerging pattern of consumption here," Mulligan said.
Chip demand recovering-Texas Instruments chief
Wednesday September 17, 1:33 pm ET
By Jim Christie
(Updates with background, share price; adds byline)
SAN FRANCISCO, Sept 17 (Reuters) - Texas Instruments Inc. (NYSE:TXN - News) Chairman and Chief Executive Tom Engibous on Wednesday said the U.S. economy is clearly recovering, and sales of microchips will grow faster than analysts have predicted amid a rise in demand for advanced chips in consumer electronics.
ADVERTISEMENT"We are clearly in that recovery mode," Engibous told Reuters after a presentation at a Banc of America Securities (News - Websites) investor conference. "Corporate America is more focused on revenue growth than cost cutting."
However, Engibous noted that job growth continues to lag improving economic outlooks among corporate chief executives.
Engibous, speaking at the conference, said he expects growth rates for the chip industry to exceed the 10 percent annual growth forecast issued recently by the Semiconductor Industry Association as advanced microchips expand the capabilities of consumer electronics including mobile phones.
Chip makers are seeking to recover from their worst-ever downturn caused by the long high-tech and telecom slumps.
Engibous said Texas Instruments, the top supplier of microchips for cellular phones, is moving aggressively into theconsumer electronics market, where products are increasingly adding wireless chips to access networks.
Dallas-based Texas Instruments earlier this month said its third-quarter revenue will come in at the higher end of its prior forecast on improved demand for semiconductor products.
That provided further evidence the chip industry is seeing renewed demand from makers of cell phone handsets, computers and other devices, according to analysts.
Texas Instruments said it expects revenue for the quarter to come in between $2.39 billion and $2.49 billion, compared with an earlier forecast of $2.29 billion to $2.49 billion.
Additionally, Texas Instruments said it expects third-quarter earnings of between 20 cents and 22 cents per share, including a 13-cent gain from the sale of 24.7 million shares of Micron Technology Inc. (NYSE:MU - News).
A rival of Intel Corp. (NasdaqNM:INTC - News) and Motorola Inc. (NYSE:MOT - News), Texas Instruments said its new revenue estimate reflected strengthening demand across a broad range of semiconductor products. It noted that revenue from chip products is expected to be between $1.99 billion and $2.07 million, compared with a previous range of $1.89 billion to $2.05 billion.
Separately, Texas Instruments on Wednesday introduced a low-power chip for mobile phones that can communicate with two types of popular high-speed wireless networks.
Shares in Texas Instruments fell 23 cents to $24.52 in active afternoon trade on the New York Stock Exchange (News - Websites). (Additional reporting by Dan Sorid in San Francisco)
Maybe next year...Qantas, Virgin Atlantic, And Srilankan Airlines Named ‘Top Airlines’ For Inflight Entertainment
SEATTLE, WASHINGTON, USA, 12 SEPTEMBER 2003 — Among the world’s passenger airlines, Qantas Airways Ltd., Virgin Atlantic Airways, and SriLankan Airlines offer the “Best Overall” Inflight Entertainment (within their respective fleet-size classes), as determined by a 22-member international media panel that evaluated inflight audio, video and print entries from 43 leading passenger airlines worldwide.
Sponsored by the World Airline Entertainment Association (WAEA), the "Avion Awards," now in its 15th year, honors excellence in several categories of airline inflight entertainment, covering audio, video, and print media, and “Best Overall.” The top finishers in 2003 are:
“Best Overall” Inflight Entertainment
Fleet-size: 51 or more aircraft
Winner: Qantas Airways Ltd.
1st Runner-Up: United Airlines
2nd Runner-Up: Delta Air Lines
Fleet-size: 21 – 50 aircraft
Winner: Virgin Atlantic Airways
1st Runner-Up: Emirates
2nd Runner-Up: Lan Chile Airlines
Fleet-size: 20 or less aircraft
Winner: SriLankan Airlines
1st Runner-Up: Hawaiian Airlines
Best Inflight Magazine: Delta Air Lines
Best Inflight Entertainment Guide (Within the Magazine): Air Canada
Best Inflight Entertainment Guide (Separate from the Magazine): Virgin Atlantic Airways
Best Single Inflight Audio Program: Virgin Atlantic Airways
Best Inflight Audio Entertainment: Cathay Pacific Airways Ltd.
Best Single Special Purpose Video: Virgin Atlantic Airways
Best Video “Magazine” Style Program: Air France
Best Inflight Video Programming – Short Haul: Cathay Pacific Airways Ltd.
Best Inflight Video Programming – Long Haul: Virgin Atlantic Airways
The inflight entertainment offerings were judged for "originality," "suitability," "production value," "content," and "balance." The judges evaluated nearly 200 samples of inflight audio, video and print that appeared in commercial service during the period from 1 June 2002 to 31 May 2003, representing 42 passenger airlines worldwide. The “Best Overall” ranking is determined by a composite score each qualifying airline receives based on that airline’s individual scores in selected print, audio, and video categories.
The 23-member international judging panel included: Greg Allen, Art Director/Photo Editor, CREEM Magazine (Los Angeles); Tom Gomes, President, Sucesso CD/Show Business Guia Int’l Magazine (Sao Paulo, Brazil); Larry Summerville, Chief Executive, More FM Radio (Auckland, New Zealand); Ray Bennett, European Bureau Chief, The Hollywood Reporter (London); Titus Chipangura, Director, National Arts Council of Zimbabwe (Zimbabwe); Ron Simon, TV Curator, Museum of TV and Radio (New York); and Jordi Rueda, Director, CLAVE Professional Magazine (Barcelona, Spain).
The winners were announced Friday night, 12 September 2003 at the WAEA 24th Annual Conference & Exhibition, held this year in Seattle, Washington, USA. The black-tie ceremony capped the week-long, international "market place" for passenger airlines and their inflight entertainment and communications suppliers.
Founded in 1979 as a nonprofit organization, the WAEA is the official worldwide network representing over 75 airlines and over 200 airline suppliers committed to excellence in inflight entertainment and communications and the continual improvement of the airline passenger environment.
For more information on the Avion Awards, the WAEA, and the inflight entertainment industry, visit the WAEA website at www.waea.org.
cksla, I could live with a Wistron. One multi-billion dollar OEM at a time. What leads you to look in this direction? I see no indication they involve themselves in mp3 player production.
good to see you out and about...
lickily, if it shows the potential being alluded to, I'm sure the content companies will pony up some cash to allow expansion as needed.
OT Garage Doors Raise DMCA Questions
By Katie Dean / Also by this reporter Page 1 of 1
02:00 AM Sep. 17, 2003 PT
Manufacturers of a seemingly innocuous product -- a garage door opener -- are embroiled in a battle that tests the limits of a controversial copyright law.
Skylink Technologies manufactures a universal garage door opener that can be used to open and shut any type of garage door. Its competitor, the Chamberlain Group, claims that Skylink violates the Digital Millennium Copyright Act, or DMCA, by selling such a product.
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Garage Doors Raise DMCA Questions
Chamberlain alleges Skylink's handheld portable transmitter can activate Chamberlain's garage door openers and, in doing so, unlawfully bypasses a technology-protection measure built into the device's software.
Skylink disagrees, and recently filed a motion in the U.S. District Court for the Northern District of Illinois for summary judgment, whereby a judge decides the case instead of going to trial.
"When Chamberlain sells (its) garage door openers, there is no restriction prohibiting the consumer from operating the garage door with a third-party transmitter," said David Djavaherian, an attorney for Skylink. "For a violation to occur under the DMCA, access to the copyright work must be unauthorized."
Neither representatives of Chamberlain nor its lawyers returned repeated calls for comment.
The case has been closely monitored by digital rights groups like the Electronic Frontier Foundation, which has argued that the DMCA is being abused by companies that want to stifle their competitors. The DMCA, the groups contend, also impedes innovation.
Congress initially passed the DMCA to address copyright issues in the digital age. Under the law, it is illegal to circumvent a technology that controls access to copyright works, and any tools used to circumvent that technology also are forbidden.
Chamberlain uses special software, called rolling code, in its garage door openers. It argues that this is copyright code. The garage door opener consists of a handheld portable transmitter and a garage door opening device, which is attached to the garage ceiling. Since Skylink's handheld portable transmitters also can make Chamberlain's garage door openers operate by activating Chamberlain's code, Chamberlain claims Skylink is violating the DMCA.
Skylink contends that consumers should be able to open their garage doors any way they please, and states in the motion that "Chamberlain has never imposed any limitations on homeowners who purchase its rolling code (garage door openers) -- either in manuals, packaging, instructions or elsewhere -- regarding which type of replacement or additional transmitter they may or may not use to access the (openers)."
"Because there is no unauthorized access to the software used in Chamberlain's garage door openers, there can be no DMCA violation," Djavaherian said.
Djavaherian also said there were several other reasons the judge should rule in Skylink's favor, namely, that Skylink's transmitters cause the internal computer processes of Chamberlain's product to operate, and this process should not be considered access to a copyright work.
He added that Skylink's product falls within a DMCA provision that permits interoperability.
In December 2002, Chamberlain filed a motion for summary judgment that was denied by Judge Rebecca Pallmeyer in August. In her ruling, Pallmeyer suggested that Skylink, rather than Chamberlain, might have a better chance of pursuing summary judgment in the matter.
The case illustrates the unintended consequences of the DMCA, critics say.
"Congress didn't intend that the DMCA should prevent me from entering my own garage," said Gwen Hinze, a staff attorney with the Electronic Frontier Foundation. "The Chamberlain garage door opener company doesn't have the right to dictate what brand of clicker I must buy to open my garage, even if they own the copyright on the software used to control the garage opener."
"By enacting the DMCA, Congress meant to protect copyright, not to prevent companies from developing devices that can interoperate with copyright software," Hinze said.
Other companies are fighting similar DMCA-related battles. Lexmark International sued Static Control Components, alleging that the aftermarket toner cartridge company illegally remanufactures cartridges to make them compatible with Lexmark printers. Static Control is countersuing Lexmark for unfair trade practices.
Joe Kraus, co-founder of DigitalConsumer.org, said the Lexmark and Skylink cases demonstrate how the DMCA is being misused by businesses.
"A law that was really intended to stop people from renting a DVD at Blockbuster and making a personal copy is instead being used by incumbents to stop innovations in fields as mundane as garage door openers and printers," he said. "If Chamberlain or Lexmark are successful, it's very worrisome for the future of innovation."
Samsung Electronics and Napster Partner on New Portable Music Device to Debut This Fall
Tuesday September 16, 6:00 pm ET
An Alliance between the Leader in Digital Music and the Leader in Digital Audio Devices Will Provide Unmatched User Experience to Music Enthusiasts
NEW YORK--(BUSINESS WIRE)--Sept. 16, 2003-- Samsung Electronics and Napster are forging a technology and marketing partnership to improve the experience of consumers using digital music. The partnership - announced today at Samsung's DigitALL Inspiration 2003 Showcase by Eric Kim, Executive Vice President and Head of Global Marketing Operations and Digital Solution Center for Samsung Electronics, and Chris Gorog, Chairman and CEO of Roxio (Nasdaq:ROXI - News), the parent company of Napster - kicks off with the introduction of a new Samsung-Napster digital audio player that is designed to work seamlessly with the Napster 2.0 music service launching in the U.S. by the holidays. The new device will be available in retail stores this fall.
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The partnership will include joint engineering and co-marketing activities centered on a line of portable music devices that integrate with Napster 2.0. The Samsung devices will be co-branded and identified as "Napster compatible" on the packaging, helping consumers understand that the Napster service and Samsung device work together seamlessly.
Napster 2.0 will offer music fans access to more than 500,000 tracks of the world's greatest music from all five major record labels and hundreds of independent labels. Users of the service will be able to purchase individual tracks or albums, which can be transferred to portable devices and burned to CDs. In addition, consumers may select a premium version of the service that offers unlimited listening and downloading, radio and community features, and unique content.
"The Samsung Electronics and Napster partnership is an example of our ongoing commitment to providing our customers with innovative products that are simple for everyone to use," said Eric Kim. "Our partnership with Napster enables us to offer our customers a seamless experience from selecting and downloading legal music from Napster to enjoying that music on the Samsung player. The relationship with Napster enables us to develop a line of offerings that will deliver an unmatched customer experience using our products with Napster content."
"Napster and Samsung share the vision that the digital music experience should be fun and very easy," said Chris Gorog. "Combining the resources of this global leader in consumer electronics together with the most recognized online music brand in the world, we will introduce a line of products that dramatically enhances the digital music experience. We look forward to a rewarding relationship with Samsung that benefits music fans everywhere."
About Napster
Napster is the world's most recognized brand in online music. Napster has extensive content agreements with the five major record labels, as well as the top independents. The service will deliver access to one of the largest music catalogs, featuring artists from Eminem and Miles Davis to the Dixie Chicks and Bob Marley. Napster is a division of Roxio, Inc., (Nasdaq:ROXI - News), The Digital Media Company® and provider of the best selling digital media software in the world. Napster has offices in Los Angeles and New York.
About Samsung Electronics
Samsung Electronics Co. Ltd. is a global leader in semiconductor, telecommunication, and digital convergence technology. Samsung Electronics employs approximately 75,000 people in 89 offices in 47 countries. The company is the world's largest producer of memory chips, TFT-LCDs, CDMA mobile phones, monitors and VCRs. Samsung Electronics consists of four main business units: Digital Media Network, Device Solution Network, Telecommunication Network and Digital Appliance Network Businesses. For more information, please visit http://www.samsung.com.
About Samsung Electronics America, Inc.
Headquartered in Ridgefield Park, NJ, Samsung Electronics America, Inc. (SEA), a wholly owned subsidiary of Samsung Electronics Co., markets a broad range of award-winning, advanced digital consumer electronics and information systems products. The SEA organization oversees the North American operations of Samsung Telecommunications USA, Samsung Electronics Canada and Samsung Electronics Mexico. Please visit www.samsungusa.com for more information.
Safe Harbor Statement
Except for historical information, the matters discussed in this press release, in particular matters related to Napster's relationship with Samsung, the re-launch of Napster, and product development, are forward-looking statements that are subject to certain risks and uncertainties such as increased competition, failure to maintain key corporate relationships, product development failures, and undetected errors in the Napster software and service that could cause actual results to differ materially from those projected. Additional information on these and other factors are contained in Roxio's reports filed with the Securities and Exchange Commission (SEC), including the Company's Quarterly Report on Form 10-Q as filed with the SEC on August 14, 2003, copies of which are available at the website maintained by the SEC at http://www.sec.gov. Roxio assumes no obligation to update the forward-looking statements included in this press release.
Copyright (C)2003 Roxio, Inc. All rights reserved. Roxio, the Roxio tagline and Napster are registered trademarks of Roxio, Inc. or its subsidiaries in the United States and/or other countries. All other trademarks used are owned by their respective owners.
--------------------------------------------------------------------------------
Contact:
Samsung Electronics
Ethan Rasiel, 212-704-4521
ethan.rasiel@edelman.com
or
Napster
Seth Oster, 310-281-5027
seth.oster@napster.com
Dance with the ones what brought ya seedie. It's called relationship building. Oh sorry Mr. Yun, Fred and Robert no longer work at e.Digital....yeah right.
touche.eom
Here's a non-nefarious thought about the alert...maybe they just finalized this deal (complete with NDA) and so now it can be told....
not nearly as dramatic as your scenario but IMHO probably closer to the truth
I would beg to differ, you would be hard-pressed to find a company in a similar industry that shares as much info as this one does; or have you forgotten your criticisms of RP emails from the recent past? One needs to make up one's mind if disclosure is selective and inappropriate or is the lack of disclosure a problem. In most cases, one cannot have it both ways methinks.
OT and the dark side of NDA use...Intergraph Accuses Intel of "Oppression"
by Linley Gwennap
In a bizarre turnaround, workstation maker Intergraph has gone from being one of Intel's sweethearts to being tossed away like a cheap tart. Intergraph has filed a lawsuit against Intel alleging patent infringement and anticompetitive behavior. The suit was apparently expected: Intel responded within hours by filing a countersuit that attempts to overturn Intergraph's patents. A second countersuit filed a week later accuses Intergraph of breach of contract.
The former Clipper vendor was the first major RISC workstation vendor to convert its products to Intel processors, and Intergraph's systems were prominently featured at the Pentium Pro introduction (see MPR 11/13/95, p. 1). As recently as May, Intergraph was on stage during Intel's launch of Pentium II.
According to the workstation maker, however, by then its relationship with Intel had already started to sour. The crux of the suits is a set of Clipper patents-U.S. 4,899,275, 4,933,835, and 5,091,846-relating to cache management, patents that Intergraph asserts are infringed by Intel's Pentium and Pentium II processors.
The suit goes well beyond patent infringement, however, accusing Intel of "a systematic campaign of coercion and oppression...to pressure Intergraph into giving up" its patent rights. After Intergraph refused to license its patents to Intel without compensation, Intel directed its employees to "cease and desist providing any support to Intergraph," according to the complaint.
Intergraph also claims that Intel unilaterally terminated its nondisclosure agreement (NDA), failed to inform the system maker of a chip-set bug, and prevented a third party from supplying Intergraph with Intel-compatible test equipment. Perhaps going over the edge, the suit even alleges that Intel has "introduced competitors into Intergraph's customer accounts" and threatened to withdraw marketing funds from companies that buy Intergraph products. (The full complaint is available at www.intergraph.com/intel.stm.)
Intel claims that Intergraph's patents are not valid and therefore its products don't infringe. Intel acknowledges that it terminated Intergraph's NDA but says it can legally do so at any time. The lack of an NDA prevented Intergraph from receiving bug reports as promptly as other Intel customers. Intel denies the other claims of improper activities. Intel's countersuit accuses Intergraph of refusing to return confidential material upon termination of the NDA, as legally required by the agreement.
Sources indicate that Intergraph, which has had only one profitable quarter in the past five years, was wielding its patents in an attempt to gain royalties from other makers of x86 workstations. Instead of settling this matter in a court of law, these system makers asked Intel to be the judge and jury in this case. Intel told Intergraph to stop asserting its patents and, when the company refused, sentenced it to the outer circle of Intel's customer list.
Intergraph's allegations of anticompetitive behavior will certainly feed an ongoing investigation by the U.S. Federal Trade Commission (FTC) into Intel's business practices. The key issue the FTC must decide in this case is whether Intel must maintain NDA relationships with all of its largest customers, due to its dominant position in the market, or whether Intel has the same right as smaller companies to decide with whom it partners. Preventing Intel from arbitrarily terminating NDAs, a tactic it also used against Digital, would remove a powerful weapon Intel can use to keep its customers (i.e., most of the computer industry) in line.
Rulings in both the Intergraph suits and the FTC investigation could take months or years. In the meantime, Intel must move nimbly in both the courts and government offices to emerge unscathed from this latest spat.
OT Intel NDA found on floor
By Mike Magee
Posted: 01/03/1999 at 16:27 GMT
At the Intel Developer Forum, The Register was asked to sign a non-disclosure agreement. We never do so, partly for legal reasons and partly because we believe journalists should not and need not sign NDAs. We prefer to operate on trust and contacts and absolutely hate burning our contracts. For example, if an Intel representative said he or she trusted us not to publish before a certain date, we might or might not do so. There is another issue here. NDAs were invented by computer companies so they could tell their partners and customers something ahead of time. Journalists are neither partners nor customers of Intel, nor of any other computer company. Finally, the legal nature of NDAs is decidedly dodgy. Why, for example, should a Scottish journalist be bound by the Laws of Delaware? Is there a reciprocal agreement between the UK government and the State of Delaware? We don’t think so. As far as we aware, these pieces of paper are untested in courts. A few years ago, The Register obtained a future Intel roadmap from one of its OEMs and published the lot. At that time, the staffer worked for a big publishing house, and Intel’s European lawyers put the screws on us, big time. If we had ever signed an NDA with Intel, we would probably be, as the saying goes, bang to rights. We found this NDA lying around at the Intel Developer Forum and thought readers might be interested in its contents, so we scanned it in. We already knew that Intel had an eight-way system but didn’t know it was called Saber. What is codename Holmdel all about? Here it is:- SINGLE-USE NON-DISCLOSURE AGREEMENT This Single Use Non-Disclosure Agreement (‘Agreement') is entered into and made effective as of the date set forth above, by and between lntel Corporation ("Intel"), and the Participant identified below ("Participant"). The parties as specified below agree on the following terms: 1. Confidential Information. The confidential, proprietary and trade secret information being disclosed by the disclosing party ("ConfidentialInformation"), is that information marked with a "confidential","proprietary", or similar legend, and is described as: (Be specific.Include subject or product, any document title, drawing/document number, date, rev. etc.) (Use additional sheets if necessary.) (a) Intel Confidential Information): Future Roadmaps, Potential Partnerships, Timelines, Functionality and ArchitecturalConsiderations regarding the following Intel Lab Technologies: 8 Way Saber Enterprise System, Pentium® I11 processor enabled Intel Video Phone, "Athens" project, Pentium® III processor enabled Fan Duct Cooling System, Merced SDK, Advanced Libraries for Graphics Tools "Geyeserville' technology, New. 18 micron 400 & 433 notebooks, StrongARM technology utilizingnew Speech Recognition algorithms, Multi-Resolution MeshTechnology Format Conversion Tools, "Holmdel' technology,and Next Generation Content Protection Technology. (b) Participants Confidential Information: All Confidential Information received from the disclosing party will be in tangible form. Nontangible disclosures must be identified as confidential prior to disclosure and reduced to writing marked as provided above and delivered to the receiving party within thirty (30) days to be considered Confidential Information. 2. Disclosure will start on: Tuesday, February 23rd 1999. Disclosure may continue for up to thirty (30) days thereafter. The parties' representatives for disclosing or receiving Confidential Information are: Intel: Michelle Klein, Bill Hammond, Jay Gilbert, Scott Trotter, Andrew Liu, Bill Colson, Gary Carleton, Mark Holier, Monique Hayward, Craig Farrer, Rusty Schafer, Derek Everett, Patrick Bohardt, Debashis Chowdury, Will Schreiber, Bart Kessler, Dan James, & Brendan Traw. Participant: All information exchanged by the parties will be made by/to these representatives. 4. Obligations of Receiving Party. The receiving party will maintain the confidentiality of the Confidential Information of the disclosing party with at least the same degree of care that it uses to protect its own confidential and proprietary information, but no less than a reasonable degree or care under the circumstances. The receiving party will not disclose any of the disclosing party's Confidential Information to employees or to any third parties except to the receiving party's employees, parent company and majority owned subsidiaries who have a need to know and who agree to abide by nondlsclosure terms at least as comprehensive as those set forth herein; provided that the receiving party will be liable for breach by any such entity. The receiving party will not make any copies of Confidential Information received from the disclosing party except as necessary for its employees, parent company and majority. owned subsidiaries with a need to know. Any copies which are made will be identified as belonging to the disclosing party and marked "confidential", "proprietary" or with a similar legend. 5.Period of Non-Assertion. Unless a shorter period is indicated below, the disclosing party will not assert any claims for breach of this Agreement or misappropriation of trade secrets against the receiving party arising out of the receiving party's disclosure of disclosing party's Confidential Information made more than five (5) years from the date of receipt of the Confidential Information by the receiving party. However, unless at least one of the exceptions set forth in Section 6 below has occurred, the receiving party will continue to treat such Confidential Information as the confidential information of the disclosing party and only disclose any such Confidential Information to third parties under the terms of a non-disclosure agreement. If initialed and filled in below, the period after which the disclosing party agrees not to assert claims against the receiving party with respect to the Confidential Information disclosed under this Agreement will be 24 months (not less than 24 nor more than 60 months), (/) 6. Termination of Obligation of Confidentiality. The receiving party will not be liable for the disclosure of any Confidential Information which is: (a) rightfully in the public domain other than by a breach of this Agreement of a duty to the disclosing party; (b) rightfully received from a third party without any obligation of confidentiality; (c) rightfully known to the receiving party without any limitation on use or disclosure prior to its receipt from the disclosing party (d) independently developed by employees of the receiving party; or (e) generally made available to third parties by the disclosing party without restriction on disclosure. 7. Title. Title or the fight to possess Confidential Information as between the parties will remain in the disclosing party. 8. No Obligation of Disclosure; Termination. Neither party has any obligation to disclose Confidential Information to the other. Either party may terminate this Agreement at any time without cause upon written notice to the other party; provided that each party's obligations with respect to information disclosed during the term of this Agreement will survive any such termination. Either party may, at any time: (a) cease giving Confidential Information to the other party without any liability, and/or (b) request in writing the return or destruction of all or part of its Confidential Information previously disclosed, and all copies thereof, and the receiving party will promptly comply with such request, and certify in writing its compliance. 9.Residuals. Notwithstanding anything herein to the contrary, eitherparty may use Residuals for any purpose, including without limitation use in development, manufacture. promotion, sale and maintenance ofits products and services; provided that this right to Residuals does not represent a license under any valid patents, copyrights or other intellectual property rights of the disclosing party. The term "Residuals" means any information that are retained in the unaided memories of the receiving party's employees who have had access to the disclosing party's information pursuant to the terms of thisAgreement. An employee's memory is unaided if the employee has not intentionally memorized the information for the purpose of retaining and subsequently using or disclosing it. 10. General. (a) This Agreement is neither intended to nor will it be construed as creating a joint venture. partnership or other form of business association between the parties, nor an obligation to buy or sell products using or incorporating the Confidential Information. (b) Both parties understand and acknowledge that no license under any patent, copyright, trade secret or other intellectual property right is granted to or conferred upon either party in this Agreement or by the transfer of any information by one party to the other party as contemplated hereunder, either expressly, by implication, inducement, estoppel or otherwise, and that any license under any such intellectual property rights must be express and in writing. (c) The failure of either party to enforce any right resulting from breach of any provision of this Agreement by the other party will not be deemed a waiver of any right minting to a subsequent breach of such provision or of any other right hereunder. (d) This Agreement will be governed by the laws of the State of Delaware without reference to conflict of laws principles. (e) This Agreement constitutes the entire agreement between the parties with respect to the disclosure(s) of Confidential Information described herein, and may not be amended except in a writing signed by a duly authorized representative of the respective parties. Any other agreements between the parties, including non-disclosure agreements, will not be affected by this Agreement. SIGNATURE BY AN AUTHORIZED REPRESENTATIVE OF EACH PARTY INTEL CORPORATION 2200 MISSION COLLEGE BOULEVARD SANTA CLARA, CA 95052-g 119 [Space for signatures etc.] ®
Some MULTI-BILLION dollar unnamed OEM is going to put out an unknown quantity of its version of the Odyssey 1000. You seem to be having a problem with saying the multi-billion dollar part. Please don't leave that part out because some might think that you were trying to discredit this information and I know that was not your intent....
Well, as a simpleton, if we revealed how much revenue we would receive from this asian oem some rocket scientist might really be able to quite easily ascertain how many units were being produced and just how aggressively this oem were going after the hdd mp3 player market now wouldn't they. Now since we don't record revenue until product is shipped, it seems to me that any projections made now would be subject to change and to the endless criticism observed on this board about any projections that do not come to pass exactly as the company forecasted. I'm long on this stock. I can wait for the revenues to be recorded...it sure seems like a positive development to me.
Sony makes Aiwa for one. Always lower end but nicely designed, excellent products IMO.
Except none of those mentioned is a multi-billion dollar OEM...not even close.
The other thing is I would assume under full disclosure that this signed NDA with the asian OEM would have been revealed some time ago if it was in fact Samsung who we have known about for some time now as maker of the Yepp hdd player. Now it could be that they decided to go it alone and ran into so many problems that they asked us to take over and hence the recent announcement. It is just as likely imo however, that there is a new player involved and I would think that Sony with it's Windows music service soon to launch is a likely second candidate.
True Sent, but I am expecting the unexpected at this point...
I'm gonna take Sony. Quality, innovation, integrity...Samsung is still on that road. Sony has yet to make an entry in the hdd field yet and they are overdue.
Verizon Challenges Music Download Decision
Verizon Challenges Use of Subpoenas to Force It to Turn Over Names of Suspected Music Downloaders
The Associated Press
WASHINGTON Sept. 16 —
An Internet company wants a federal appeals panel to help disarm lawyers for the music industry, blocking them from using special copyright subpoenas in a campaign to track and sue computer users who download songs online.
Verizon Communications Inc. is challenging the constitutionality of the subpoenas under the 1998 Digital Millennium Copyright Act. A trial judge, John D. Bates, earlier had approved use of the subpoenas, forcing Verizon to turn over names and addresses for at least four Internet subscribers.
The 1998 law, passed years before music downloading was popularized, permits music companies and others to force Internet providers to turn over the names of suspected pirates upon subpoena from any U.S. District Court clerk's office. A judge's signature is not required.
Critics of the procedure contend judges ought to be more directly involved, given the potential privacy issues involved when a corporation is asked to reveal personal information about customers over an allegation of wrongdoing.
In an unprecedented crackdown on music piracy, the Washington-based Recording Industry Association of America has issued at least 1,500 such subpoenas this summer. It has filed civil lawsuits against 261 people so far it accused of illegally distributing music online and promised thousands more lawsuits.
The three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit was being asked Tuesday to consider whether Bates correctly ruled against Verizon earlier this year. The panel includes Chief Justice Douglas Ginsburg and Senior Judge Stephen F. Williams, both Reagan appointees; and John Roberts, appointed by President Bush in May 2003.
Verizon had argued unsuccessfully that Internet providers should only respond to such subpoenas when pirated music is stored on computers that providers directly control, such as a Web site, rather than on a subscriber's personal computers. It also said judges should approve requests for subscriber information only after "John Doe" civil lawsuits have been filed.
In his ruling, Bates criticized Verizon's "strained reading" of the law. He wrote that Verizon's interpretation "makes little sense from a policy standpoint," and warned that it "would create a huge loophole in Congress' effort to prevent copyright infringement on the Internet."
Sen. Sam Brownback , R-Kan., planned to introduce a bill Tuesday to protect Internet providers from such subpoenas. His proposal, which he called the "Digital Consumer Internet Privacy Protection Act," would block subpoenas except in pending civil lawsuits or in cases where pirated data files were stored on computers such as Web sites.
Still, a courtroom challenge may be Verizon's best hope.
Sen. Orrin Hatch, R-Utah, the chairman of the Senate Judiciary Committee, cautioned last week that it was too early to consider changing the 1998 law. He asked lawyers on all sides and consumers to report to his office about their experiences with these subpoenas over the next six months.
"These issues have not ripened enough," Hatch said during a Senate hearing. "I don't think we can yet determine if these subpoenas are being used responsibly to identify alleged infringers."
Hatch cited the continuing appeals court fight between Verizon and the recording industry, along with some related legal skirmishes.
"As we start to hear more voices protesting the impact of these subpoenas, there may be more of a chance to reconsider their impact," Hatch said.
On the Net:
Contested ruling: www.dcd.uscourts.gov/Opinions/2003/Bates/02-ms-323.pdf
RIAA: www.riaa.com
Verizon: www.verizon.com
Digital audio processing in package deal
By Anthony Cataldo
EE Times
September 15, 2003 (1:02 p.m. ET)
SANTA CLARA, Calif. — For engineers designing digital audio systems, choosing the right audio codec isn't always a straightforward exercise.
A sampling of different audio technologies-MP3, Dolby AC-3, MPEG-2 AAC, MPEG-4 AAC, DTS and others-shows how tough choosing one standard can be. And that's just the first step in a longer process that includes licensing, compliance testing and royalty assessments.
But for Tensilica Inc., the fragmented state of affairs of digital audio presents an opportunity. This week, the company said, it will roll out a package of audio codecs and new instructions for its Xtensa processor that take some pain out of digital audio design. At the same time, it promises to raise the bar on sound quality.
The audio package includes 10 encoders and decoders in C and assembly code, a binary-compiled version of the software and audio-specific instructions. These special instructions were developed by Cute Solutions Pvt. Ltd., one of a handful of companies that Tensilica works with to develop application-specific instructions for its configurable processor.
Tensilica doesn't claim to support all of the available audio standards but says it can support some of the more widely known, such as Dolby Digital AC-3, MP3, MPEG-2 AAC, MPEG-4 AAC as well as the G729AB speech codec for voice-over-Internet Protocol. The price starts at $50,000 for a basic MP3 decoder engine.
"It takes a long time to learn the standards and then translate that into an SoC design. This is more efficient, and in the long run it's cheaper," said Larry Przywara, director of strategic alliances.
Solid State Systems Co. Ltd. of Taiwan has endorsed Tensilica's solution, saying it's expected to speed development of an upcoming product.
Besides time-to-market, Tensilica's audio engine aims to improve sound quality by including instructions for a 24-bit media access control.
manufactured THROUGH APS two important words which you conveniently neglect. The point stands, I believe, that not enough information has been released for any to make solid conclusions about who paid for what yet. Most of us shareholders are patient enough to wait and see and understand as well that for competitive reasons this info is not necessarily for public consumption.
sanitized for your protection
USB Implementers Forum, Inc. Announces USB On-The-Go Compliance Program and First Product Certifications
Monday September 15, 10:00 am ET
PORTLAND, Ore.--(BUSINESS WIRE)--Sept. 15, 2003--The USB Implementers Forum announced today that all the components for its USB On-The-Go (OTG) compliance program are now available, including compliance test documentation, Certified USB On-The-Go logos and compliance test tools to assist companies in preparing for certification testing for their hand-held devices. In addition, the organization announced that seven devices have now completed OTG certification. A product's use of the Certified USB On-The-Go logo assures users that it contains a standard connector and operates compliantly with PCs and other USB or OTG devices it supports.
The USB OTG specification was designed by leading electronic manufacturers, in order to enhance the already popular USB standard with the portability and low power features needed by consumer electronic devices such as digital cameras, cell phones, portable audio players or personal digital assistants (PDAs).
"When consumers see the Certified USB On-The-Go logo, they will know that their hand-held device can talk to, or link, with PCs as well as all the other USB or OTG devices on its supported device list," said Terry Remple, USB program manager for Qualcomm and co-chairman of the OTG working group. "An OTG-compliant product lets users more easily share files, music, videos or pictures directly with another portable or desktop device. This allows users to share content in more unique ways than ever before."
USB On-The-Go-compliant devices allow users to link to other USB devices without requiring the PC to act as the host. This means users can perform such functions as sending photos from a digital camera to a printer, PDA, cell phone; or sending music files from an MP3 player to another portable player, PDA or cell phone.
For additional information regarding the USB-IF OTG Compliance Program and compliance test tools, visit the OTG portion of the USB-IF website at www.usb.org/developers/onthego. Compliance workshops are held approximately once every three months and are open to USB-IF members. To qualify to use the Certified USB OTG logos vendors must execute the USB-IF Trademark License Agreement in addition to passing compliance testing. The licenses are available at www.usb.org.
About USB On-The-Go
USB On-The-Go (OTG), a supplement to the USB 2.0 spec, brings the additional feature of allowing portable devices to act as a limited host and exchange data directly with each other without requiring a PC to act as the host. It is estimated that more than 1.4 billion products are designed with USB ports, making USB the predominant I/O connectivity standard in the market. USB On-The-Go (OTG) enhances the USB specification by allowing point-to-point communication between devices. As devices like mobile phones and PDAs gain in popularity and intelligence, the requirement for a direct connection to each other is also growing. The answer to this requirement is the standard called USB On-The-Go.
About USB-IF
The non-profit USB Implementers Forum, Inc. was formed to provide a support organization and forum for the advancement and adoption of USB technology. The USB-IF facilitates the development of high-quality, compatible USB devices, and promotes the benefits of USB and the quality of products that have passed compliance testing. Further information, including postings of the most recent product and technology announcements, is available by visiting the USB-IF Web site at www.usb.org.
Editors: Graphics and logo are available by calling Deborah Paquin, 916-984-1921.
--------------------------------------------------------------------------------
Contact:
Strategic Communications
Deborah Paquin, 916-984-1921
debpaquin@strategiccom.biz
Future of Digital Books Lies with Babies, Boomers
29 minutes ago
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By Franklin Paul
NEW YORK (Reuters) - Don't slam the cover on digital books just yet.
Readers hungry for a good page-turner will still turn to bookstores and libraries, but cheaper computers and changing consumer habits suggest that electronic books, or e-books, still have a future.
To be sure, that future is years away, particularly after Barnes & Noble Inc. (NYSE:BKS - news), the world's largest bookseller, last week shook the nascent market by shutting its eBooks (news - web sites) store. Daniel Blackman of barnesandnoble.com said downloadable books have not lived up to their hype.
"There is a market ... but it has not materialized to the point that we will be able to support the business," he said.
As with digital music, multiple books -- say, Shakespeare's collected works -- can be stored on a memory card the size of a stick of gum, making them popular with travelers, students and professionals. They are read on hand-held devices running operating systems by Palm or Microsoft, or on a PC or notebook computer.
E-books may find their niche with tech-savvy youth unfazed by the notion of browsing literature on a screen, and the growing legion of retirement-age readers, according to Richard Doherty, research director at Envisioneering Group.
"Two audiences that will benefit best are young people who loathe the idea of a library ... and aging people who want the convenience of large type on demand," or freedom from lugging heavy hardcover tomes.
For now, e-books are an afterthought in the publishing world. Less than 500,000 electronic books were sold in the United States in 2002, compared with more than 1.5 billion printed books, estimates research firm Ipsos-Insight in Chicago.
GROWTH EXPECTED, SLOWLY
Back in 2000, downloadable books enjoyed the same kind of ebullience lavished over all things Internet, with research firms projecting sales of about $250 million by 2005.
That excitement waned after a brief period of hype, which saw the likes of Microsoft Corp.(Nasdaq:MSFT - news), Palm Inc. (Nasdaq:PALM - news), Adobe Systems Inc. (Nasdaq:ADBE - news), Gemstar and Franklin Electronic Publishers Inc. (AMEX:FEP - news) developing gadgets on which one could read stories or software to mimic the look of a printed page.
Seen as too heavy, too expensive and not as much fun to read as paperbacks, tablet-like e-book devices failed to catch on. Gemstar-TV Guide International Inc. (Nasdaq:GMST - news), which aspired to be the world's top e-book supplier, quit the business in July and stopped selling the gadgets.
"The typical American consumer isn't ready for an e-book," Barrie Rappaport of Ipsos said. "It doesn't fit in their lifestyle at this point. As far as reading goes, people like to touch paper."
Moreover, while major publishers have committed to e-books, concerns about piracy -- which has ravaged the music industry -- may limit the number of new titles that are made available.
Still, Palm, Microsoft and Adobe continue to improve their respective reader software, which are free. Palm, Adobe and retailer Amazon.com Inc. (Nasdaq:AMZN - news), which also sells downloadable books, said they plan no major strategic changes.
'GREAT FUTURE'
"We think that in the long term, e-book technology has a great future," said Adobe's Russell Brady. "Market acceptance has not taken off quite as quickly as was predicted, but we are certainly continuing to invest in this area."
They are encouraged by the evolution of pocket-sized computers and lower notebook prices, providing more screens on which e-books can be read. More than 20 million handhelds have been sold and new models sell for less than $100.
"(On Wednesday) we sold 2,000 e-books. It was the largest retail day at Palm Digital Media in 2003, and we are having the largest month ever," Ryan WuerchMost, chief executive of privately held Web retailer PalmGear, said last week. PalmGear recently bought Palm Inc.'s digital publishing unit.
He estimated that PalmGear, whose offerings range from "Beowolf" to best-sellers by Stephen King and Al Franken, will sell some 1.3 million e-books over the next 12 months.
To further raise awareness, sellers must cut prices, according to IDC analyst Susan Kevorkian.
"It is too early to declare the demise of the digital book," she said. "(But) to raise awareness there needs to be competitive pricing in place to get people to adopt the technology."
HH, the flipside...most all of our entries with initially MP3 players came with the backdrop of a bursting bubble economy and few of us saw what we had hoped for particularly when Collier came on board. The economy continued then as now to be completely listless and with the exception of the Ipod, I think it's safe to say that no one is getting rich on selling mp3 players...ask Sonic Blue. Through it all, we have survived and are now poised to get respectable notice in several different markets that we had no prior involvement in while we continue to percolate in the mp3 player field with Digitalway which is an internationally known producer of such players
We may need to ask Portalplayer what happened to their referral program, cause it doesn't look like any of the other partners mentioned are releasing products either. Then again, the product cycle for these items is about 9 months so we should just now be in a position to hear something if such products have been produced.
There is always the cup half-empty or half-full scenario around here and I would say we have stared into the abyss of the empty cup about 4 months ago. The java is rising and now we just need to hope that the waitress doesn't forget us and comes around with a fresh pot.
I think I'm getting hungry...
Dualing video codecs square off at broadcast conference
By Junko Yoshida
EE Times
September 13, 2003 (1:54 a.m. ET)
AMSTERDAM, the Netherlands — The battle between two competing next-generation video codecs — H.264 and Windows Media 9 — escalated this week during the International Broadcast Convention (IBC) here, with Microsoft Corp.'s sudden declaration that it will make its proprietary Windows Media 9 video codec a movie and TV standard.
Meanwhile, Via Licensing Corp., an IP licensing agency, announced Friday (Sept. 12) the availability of preliminary financial licensing terms for patents essential for H.264 implementation. The industry had been waiting for such a sign, indicating that H.264 IP rights issues might finally be resolved. However, Via Licensing fell short of disclosing individual companies participating in its patent pool.
Video codec quality, standards-based technologies over proprietary solutions and the availability of reasonable license terms stand out as the three keys for any video codec to gain a broad adoption among broadcasters and consumer electronics manufacturers. Proponents of H.264 and Windows Media 9 are both accelerating their efforts here to win over the broadcasting industry.
In particular, Microsoft's move - using the Society of Motion Picture and Television Engineers (SMPTE) as a backdoor to portray Windows Media 9 as "an open standard" — is viewed by many here as a calculated move to gain support for the proprietary technology from both the broadcast and telecom industries.
Jonathan Usher, director of the Windows Digital Media Division, said, "Windows Media 9 video has been receiving a lot of positive comments from broadcasters since we launched it at IBC a year ago. But we've been told by broadcasters that it would be even better if Windows Media 9 were an open standard."
Despite the gambit, Microsoft appears untroubled that it might be single-handedly undermining years of intensive H.264 joint development efforts by standards bodies. Ironically, a Microsoft executive chaired the H.264 joint video team and successfully guided the group to completion of the H.264 spec that was ratified last May.
Microsoft's Usher defended his company's position, by noting, "We eventually came to different conclusions." He explained, "H.264 was all about compression efficiency. But we at Microsoft needed to strike a good balance between the compression efficiency and computational efficiency because of our desire to do decoding in software on a PC platform."
Besides computational efficiency, Usher also claimed "some advantage" of Windows Media 9 video codec in encoding quality. "We are definitely on a par or better than H.264," he said. "Many experts in Hollywood actually liked the texture and film grains that Windows Media 9 seems to be able to capture."
H.264 proponents begged to differ. For example, SandVideo, an H.264 codec company, contrasted a split-screen demonstration of SandVideo-tuned encoder against Microsoft's latest Windows Media 9 encoder.
Although SandVideo said it used all of Microsoft's features to increase the Windows Media 9's encoding quality — including variable bit rates, two pass encoding and high decoder complexity — the encoded image showed marked artifacts, when compared to a SandVideo-tuned H.264 Main Profile encoder using all the encoding tools developed by the standards group.
Patrick Griffis, director of worldwide media standards at Microsoft, predicted Windows Media 9 video will become a SMPTE open standard within the next six to 12 months. Microsoft delivered its 350-page spec to SMPTE earlier this week.
The group is expected to review the spec, determine whether it is ready for implementation and prepare it for balloting and a comment period, Griffis explained. Once it becomes a SMPTE standard, "Anyone can go to SMPTE, get the spec and do its own implementation" independent of Microsoft, he said.
Previously, companies would have had to first sign an agreement with Microsoft before they could get access to the Windows Media 9 video bit stream. Companies implementing it in their systems and services will still have to pay royalties to Microsoft.
Just before submitting its spec to SMPTE, Microsoft officially froze the Windows Media 9 video bit stream syntax, according to Usher. Hence, its codec will no longer be a moving target for those who hope to implement it on a non-PC platform.
Not everyone buys the argument that Windows Media 9 becomes an "open system" once it becomes a SMPTE standard. According to Rob Koenen, president of the MPEG Industry Forum, "It simply means a public documentation on a proprietary system." In developing a true open standard, it must go through due diligence, with contributions from the industry, evaluation by experts and standards approval, Koenen said.
Like Windows Media 9 video royalties, Via Licensing's preliminary licensing demands no content-use fees. Via is asking for $0.25 per device for H.264 encoder/decoder royalties. Details are available at Via Licensing's Web site.
Andrew Fischer, Via's director of licensing business development, said nine unidentified companies have agreed to publish basic license terms for patents. Calling the licensing terms "a basic framework," Fischer added, "We know how urgent it is to complete this."
Via Licensing said standard licenses should be available for no later than early 2004.
File-Sharing Battle Leaves Musicians Caught in Middle
By NEIL STRAUSS
September 14, 2003
Since the Recording Industry Association of America began its campaign against file-sharing services and unauthorized song swapping online in 1999, it has offered one chief justification for its actions: downloading songs is stealing money from the pockets of musicians.
But the musicians themselves have conflicted responses to file sharing and the tactics of the association, a trade group that represents record labels, not the musicians themselves, who have no organization that wields equal power.
So, many musicians have found themselves watching helplessly from the sidelines as the recording industry has begun suing people who are their fans, their audience and their consumers — who also share music online without authorization. Last week, 261 lawsuits were filed, the first battle in what the association says will be a long campaign of litigation against the most active music fans sharing songs on services like KaZaA.
"On one hand, the whole thing is pretty sick," said John McCrea, a singer and songwriter in the rock band Cake. "On the other hand, I think it'll probably work."
Many musicians privately wish file sharing would go away, though they are reluctant to admit it, because they do not want to seem unfriendly to their fans. So they have been happy to have the industry group play the role of bad cop. But with the escalation of the battle last week (with lawsuits filed against, among others, a 71-year-old grandfather and a 12-year-old girl), some musicians say they are beginning to wonder if the actions being taken in their name are a little extreme.This is especially true because, regardless of file sharing, they rarely see royalties.
"It would be nice if record companies would include artists on these decisions," said Deborah Harry of Blondie, adding that when a grandfather is sued because, unbeknownst to him, his grandchildren are downloading songs on his computer, "it's embarrassing."
The artist Moby, on his Web site, offered a similar opinion, suggesting that the music companies treat users of file-sharing services like fans instead of criminals. "How can a 14-year-old who has an allowance of $5 a week feel bad about downloading music produced by multimillionaire musicians and greedy record companies," he wrote. "The record companies should approach that 14-year-old and say: `Hey, it's great that you love music. Instead of downloading music for free, why don't you try this very inexpensive service that will enable you to listen to a lot of music and also have access to unreleased tracks and ticket discounts and free merchandise?' "
A few artists, like Metallica and Loudon Wainwright III, have come out strongly in favor of the record industry's crackdown. It could be seen as a gutsy move, considering the criticism Metallica faced from music fans when it campaigned against the file-sharing service Napster, which was declared illegal.
In a new song, "Something for Nothing," Mr. Wainwright makes fun of the mentality of file sharers, singing: "It's O.K. to steal, cuz it's so nice to share." As for the lawsuits, he said that he was not surprised. "If you're going to break the law, the hammer is going to come down," he said.
At the same time, other influential musicians and groups — like Moby, System of a Down, Public Enemy, and the Dead — contend that the record industry's efforts are misguided and that it must work with the new technology instead of against it.
But most seem ambivalent, or confused.
"I see both sides," said Rodney Crowell, a country music singer and songwriter. "In some ways, I think the record companies have it coming, but at the same time, being a writer and therefore in the business of copyright, they're saying it's impacting our business by 30 percent or more, so we have to do something."
The Recording Industry Association says there has been a 31 percent drop in sales of recorded music since file sharing became popular more than three years ago, but statistics from Forrester Research show that the sales decline since 2000 has been half that, or 15 percent, and that 35 percent of that amount is because of unauthorized downloading.
The situation has become so thorny that many top-selling artists, even those who have been outspoken about embracing new technology, declined to comment on the lawsuits on the record, for fear of upsetting their labels. In interviews, some musicians and their representatives said that their labels had asked them not to talk. And in a dozen cases, record labels did not grant interviews with musicians on the subject.
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"I don't think anyone really understands the impact of what's happening, and they don't want to make a mistake," said Allen Kovac, who runs 10th Street Entertainment, an artist management company in Los Angeles. "The impact of lawsuits on fans is a double-edged sword. If you're a record company, do you want record company acts being persona non grata at every college campus in America?"
Much of the stated concern over file sharing has centered on the revenue that record companies and musicians are losing, but few musicians ever actually receive royalties from their record sales on major labels, which managers say have accounting practices that are badly in need of review. (Artists do not receive royalties for a CD until the record company has earned back the money it has spent on them.)
Even the Backstreet Boys, one of the best-selling acts of the 1990's, did not appear to have received any CD royalties, their management said.
"I don't have sympathy for the record companies," said Mickey Melchiondo of the rock duo Ween. "They haven't been paying me royalties anyway."
Musicians tend to make more money from sales of concert tickets and merchandise than from CD sales. In fact, many musicians offer free downloads of their songs on their Web sites to market themselves.
For some of them, the problem with file sharing is control. Before a CD is released, early versions of the songs often end up on file-sharing services, where fans download the music under the misconception that it is the finished product. Other times, songs online by one act are credited to another act. And fans exchange studio outtakes, unreleased songs, and live performances that some artists would prefer remain unheard.
Serj Tankian of the hard-rock band System of a Down, for example, said he thought that the free exchange of songs by his band and others online was healthy for music fans, but objected when that free exchange included unfinished studio recordings.
Ween, which recently left a major record label, Elektra, to release its records independently, has found a way to coexist with file sharing, which the band actually supports by encouraging fans to record and trade shows.
At the same time, Ween fans police eBay for people who are selling live recordings and KaZaA for people who are leaking songs before an album is released. "Before `Quebec,' came out," Mr. Melchiondo said, referring to Ween's latest CD, "our fans would message people on KaZaA who were sharing tracks and ask them to take the music down. And they also mounted a campaign where they put up fake copies of our record to throw people off."
Mr. Melchiondo said that Ween's fans acted out of respect for the band, not because of intimidation from the record industry or sympathy with it. "We never asked them to do this," he said. "They just took it upon themselves."
Beaten-down Sony (SNE: news, chart, profile) had subpar sales for its fiscal first quarter ending June 30 and a stunning $926 million net loss in the three-month period before that. It has vowed to improve its performance and make its products more relevant in an age of digital technology.
Next month, Sony will introduce an extensive revamping of its plants and products intended to revitalize its electronics operations and raise its operating-profit margin to 10 percent in three years from the current 2.5 percent. Analysts have hoped Sony would limit its unprofitable, low-end Aiwa operations.
Sony rose 74 cents, or 2 percent, to $36.91.
European Taxes On Music-Copying Devices To Rise - Study
Friday September 12, 12:20 pm ET
BRUSSELS -(Dow Jones)- Taxes in some European countries on digital technology capable of copying recorded music will skyrocket in coming years in a response to music piracy, an industry-financed study published Friday said.
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The study, by intellectual-property consultancy Rightscom Ltd. in London, said taxes in Europe on digital-video-disc burners, MP3 recorders and other copying devices will rise sharply.
It said money collected in five European countries to compensate artists for private copying of films and music will jump five-fold to EUR1.5 billion in 2006 from EUR309 million last year.
Hardware-makers say the levies hurt sales and evaporate their razor-thin margins on personal computers and digital devices.
"How will Europe plan on being the No. 1 knowledge-based economy in 10 years if we sandbag the tech sector?" said Francisco Mingorance, European director at the Business Software Alliance. The Washington-based trade group represents Cisco Systems Inc. (NasdaqNM:CSCO - News) , International Business Machines Corp. (NYSE:IBM - News) , Intel Corp. (NasdaqNM:INTC - News) , Apple Computer Inc. (NasdaqNM:AAPL - News) and Microsoft Corp. (NasdaqNM:MSFT - News) , among other software makers.
Organizations that collect money on behalf of artists support the new levies. Ever since the development of the tape recorder in the 1960s, European countries have taxed recording devices.
"If a country decides to put levies on copying equipment, it has to extend that to PCs," says Frank Thoms, an official at VG Wort, which represents more than 300,000 authors and 7,000 publishers in Germany. VG Wort is trying to impose a EUR12 tax on new PCs - a proposed tax contested in court by PC makers.
The tussle comes at a troubled time for the music industry. Shipments of recorded music are down 26% from 1999, and revenue is down 14%. The industry blames rampant Internet piracy for eroding music sales.
The debate shows how Europe's approach to online piracy differs from the U.S.'s, where the preferred solution is technology: software that allows legitimate copying - and catches those who cheat. Apple's iTunes Music Store, launched in April, is a prime example. The computer maker's online music service lets users download songs, burn them on CDs and keep them as long as they want, for 99 U.S. cents a song.
The film industry is making similar moves. Movielink, an online joint venture of five Hollywood studios, rents movies to users' computers for a fee between $ 1.95 to $4.99 and then deletes them after a time.
Under European Union law, governments are supposed to take new "technical protection measures" used by iTunes and Movielink into account when setting new taxes. But in the Rightscom study, none of the countries surveyed - France, Germany, Italy, the Netherlands and Spain - followed these rules.
-By Matthew Newman, Dow Jones Newswires; 322-285-0133; matthew.newman@dowjones.com
Cinea, Inc. is a leading provider of anti-piracy products and services for the entertainment and media industry.
Founded by the same world class engineering team that developed and operated the Divx™ encrypted DVD platform, Cinea leverages a core set of technologies and patents to market both stand alone and integrated solutions for digital cinema, HD-DVD, in-flight entertainment, VOD and other high value entertainment markets.
Cineas products and services include encryption and key management, forensic watermarking, secure audit and logging and anti-camcorder protection. Cinea markets these products and services to content providers and entertainment industry vendors worldwide.
09:40 - 10:40 Educational Sessions (view session descriptions)
Choose from three highly-focused simultaneous sessions targeting key day-to-day IFE issues:
Broadband & Internet Onboard
Speakers: Peter Lewalter (Lufthansa German Airlines); Jamie Cassidy (British Airways)
Creative Content Strategies for Today's Systems
Speakers: Albert de Wet (South African Airways); Jose Asiain (TransVision On Board Entertainment & Media Sales); John Bruckman (InterAct Network, Inc.)
Digital Content Tomorrow
Moderator: Michael Childers (IMDC)
Speakers: David Frankenbach (Rockwell Collins); Julian Levin (Twentieth Century Fox Film Corp.); John Nelson (Cinea, Inc.)
10:40 - 11:00 Break
Starz Encore Group's Sie Applauds FCC Decision on Copyright Status Of Subscription VOD as Consumer-Friendly
Wednesday September 10, 8:51 pm ET
ENGLEWOOD, Colo., Sept. 10 /PRNewswire/ -- Starz Encore Group LLC (Starz Encore) founder, chairman, and CEO John J. Sie today applauded the decision of the Federal Communications Commission (FCC) on the copyright status of subscription video-on-demand (SVOD) as "potentially a significant victory for the cable and satellite industries and their millions of customers."
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The FCC, in adopting the so-called "plug and play" agreement between the cable industry and the consumer electronics industry, rejected a portion of the agreement that would have classified SVOD services as "copy never." Starz Encore, in filings with the FCC, had argued that the proposal therefore contravened the Digital Millennium Copyright Act, which classified all subscription services as "copy once." It also, Starz Encore said, would have abrogated the rights of cable and satellite customers to copy programming off of their subscription premium services, a right they have enjoyed for decades.
Instead, the FCC adopted a rule which will remove SVOD from the "copy never" category. "We look forward to seeing the final terms of the Commission's action," Sie added. "We have always wanted the viewers of our subscription premium movie services to enjoy the best possible viewing experience, and that includes the right to copy once, for personal use, their favorite films from our services.
He added that the "struggle over copyright has been going on for decades, with Hollywood and its allies generally preferring to limit copying rights for consumers, and the cable and satellite industries on the side of a consumer's right to copy for home personal use. We will continue our efforts to protect the rights and expectations of consumers on this issue. If we are successful, the cable and satellite industries and their customers everywhere will benefit, as will the new SVOD services that are springing up."
Starz Encore Group LLC (Starz Encore) is the largest provider of premium movie services in the United States with approximately 142 million pay units. Starz Encore offerings include the Starz Super Pak®, with up to 13 digital movie channels and about 800 movies per month, Starz On Demand®, the only on-demand pay TV subscription service available on cable, satellite, and broadband platforms, and a suite of advanced video offerings, including STARZ! HD(SM) , STARZ! Hi Res(SM), Sharper Movies HD(SM), and Starz On Demand HD(SM). Starz Encore is a wholly-owned subsidiary of Liberty Media Corporation (NYSE: L - News, LMCb - News), www.starzencore.com .
For further information please contact Tom Southwick, +1-720-852-5821, or cel, +1-303-513-3758, tom.southwick@starzencore.com , or Eric W. Becker, +1-720-852-4065, eric.becker@starzencore.com , both of Starz Encore Group.
Phillips is a ringer tho.eom
Films, TV, gate info fall into fliers' lap
ALASKA AIR: Passengers on long flights can watch programmed fare for a fee.
By SARANA SCHELL
Anchorage Daily News
(Published: September 11, 2003)
Alaska Airlines passengers on some long-distance flights will be able to watch movies or television, listen to music and surf gate information via laptoplike units starting in October, the company said.
First-class passengers on long flights -- including the Anchorage-Chicago run -- can watch shows like "The Simpsons" for free, but coach passengers will be asked to cough up around $10 to watch "Ice Age" or listen to Madonna on a rented digEplayer.
The new way to entertain passengers came from an airline employee, a baggage handler and entrepreneur who saw a way around the airline's problem: It had started offering five- and six-hour transcontinental flights but didn't have a way to show movies on its planes.
Frustrated customers and employees wanted to know why the airline, which prides itself on offering customers a little more, wasn't ponying up.
Marketing department manager Dave Palmer spelled it out in an in-company newsletter. First, a satellite system couldn't deliver content in Canada or Mexico, two places the airlines regularly flies through or to. Second, it would involve a half-million-dollar investment per plane, with the weight adding some $80,000 in extra annual fuel costs.
"Geez, should we be investing $500,000 per airplane that technology could outstrip," like audio systems supplanted by Sony Walkmans and in-plane telephone ousted by cell phones, Palmer asked. The answer came up no. "We'd never recoup our investment."
Employee Bill Boyer, who was running a day spa and two coffee shops and being a barristo when he wasn't working as a baggage handler, came up with an idea for a portable system and took it to Palmer.
"It was a very elegant idea, very simple," Palmer said. But without content, it was an empty box. So Palmer challenged Boyer to go get content.
"I went down to Hollywood and knocked on some doors," said Boyer, 38. Twentieth Century Fox had already responded to a letter from Boyer and signed on to provide movies.
Unlike a DVD player, all the content is programmed into the box -- no popping in a disc of your best friend's wedding. While it won't take the place of passengers' laptops, it will supply lots of viewing and listening options.
Digital Music Express contributed 10 hours of music. Alaska Airlines has gate information, promotions and travel guides for the cities it serves on the player.
Boyer said his company, APS Inc., is talking to golf courses about buying advertising time on units.
"This is one of the most exciting new products I have seen in a long time," said Julian Levin, a vice president with Twentieth Century Fox, in a press release for the product.
Palmer said Alaska Airlines is thrilled with the product's flexibility. The company can invest in the technology a few units at a time, units can stay in a market while planes are rotated through different flights, and customers pay if they want to.
"We'll see what the appetite is for them" in flights between Seattle to the East Coast and between Anchorage and Chicago, Palmer said, "then move into other markets.
"We're all about trying to offer choices," Palmer said. "Some people just want a book."
Free Brianna LaHara!
The RIAA’s Crackdown on Music Downloading Is a Vain Solution to a Phenomenon That Won’t Stop
Commentary
By Michael S. Malone
Special to ABCNEWS.com
Sept. 11 — Give the record industry credit: It has shown far more creativity and imagination in screwing up this music download business than it has in the popular music it's produced over the last 10 years.
I mean, is it possible to blow a PR campaign worse than this?
It's been a long time since I was a corporate flak, but even I know that when you're searching for a good, high-profile case as an example to scare off everyone else you don't pick a 12-year-old honors student from the projects — Brianna LaHara of New York City — and you don't bust into her room while she's doing her homework.
"I am sorry for what I have done," Brianna said in a statement that showed absolutely no adult influence whatsoever, "I love music and don't want to hurt the artists I love."
Sheesh. Why not shoot her too, and claim she was resisting arrest? Or maybe put handcuffs on her little wrists next to her charm bracelets? What genius thought of this? Yeah, this'll put the fear of God into every MP3-dealing junior high school cheerleader in America.
But that wasn't enough. Having made complete idiots out themselves, the powers that be at Recording Industry Assocation of America then tried to do damage control by announcing that it was "settling" the potential $90,000 fine with little Ms. LaHara for just $2,000. See, we're not as hard-hearted as we looked. Great, so now the message is: we crush children, but don't worry Mr. Professional Downloader, we're not really serious about all this. We're just bluffing. Meanwhile, the technology news Web site slashdot.org has started a fund to pay Brianna's "fine."
A Bankrupt Industry
That was Tuesday morning. By Tuesday afternoon, the RIAA had taken a new tack. "Look! Look!" It screamed, "There's child pornography available on the peer-to-peer download sites."
Yeah, no kidding. When you drive a billion-dollar industry underground, don't act surprised when it's suddenly populated by predators, perverts and all the other denizens of the demimonde. But what's most shocking about this latest announcement was that the record industry was able to make it with a straight face.
After all, this was just a week after the MTV Video Awards show, to which Snoop Dogg arrived accompanied by his favorite pimp and leading two women on leashes — and, of course, a dominatrix-dressed Madonna swapped spit on stage with a career-desperate Christina and Britney while her little girl looked on nearby.
If the recording industry is so concerned about bad influences on young people, why is 50 Cent at the top of the charts? And if it that upset about kiddie porn, why does R. Kelly have a recording contract at all?
No, what we've seen in the last couple weeks, on stage and in the courts, is the exposure of the current spiritual and creative (and perhaps soon, financial) bankruptcy of the pop music industry. Lately, it's been a tsunami of symbols and portents: besides the ones already noted, there was also the shut-out of Johnny Cash at the VMAs, the death of Warren Zevon, the simultaneous sellout and ascendancy of Beyonce … and, of course, Justin Timberlake.
As I've written in this column before, it's 1962 all over again. Movie stars have become rock stars, style matters more than content, and every song on the Top 30 has been designed by committee with help from the marketing department. It's choreography as music and the Disney Channel as distributor.
It Won’t Go Away
This industry cynicism extends to the products, the CDs, themselves. As the recent price cuts show, the record industry has been gouging the market for a long time — at least since the advent of the CD essentially killed the two-song, cheap 45.
And kids aren't stupid. They know they are getting ripped off both aesthetically and commercially. So, they've fought back with the one weapon they have in abundance: Easy familiarity with technology: Napster, Kazaa, Morpheus and all the other P-to-P sites, each one driven by mounting record industry litigation to become a little more amorphous, decentralized and intangible.
Are they illegal? Sure they are. But the sheer numbers of participants suggests that what we are seeing is an upwelling of mass desire (or mass frustration) by an entire generation. This is not a genie that can be put back into the bottle, even by arresting and intimidating 12-year-old girls. All that does is guarantee that the next generation of download technology will be even more sophisticated, more decentralized, and, thanks to cryptography, even more elusive. This time the RIAA could find the owners of the computers. Next time they will be invisible.
More than a year ago I suggested in this column that the music industry face the reality that its lucrative little con game was over, and begin figuring out how to co-opt the new world of Internet downloads — perhaps through multi-tiered pricing according to audio quality. Steve Jobs even showed them how to do it, for which Apple is being amply rewarded, with iMusic already reaching 10 million downloads.
But the music industry apparently refuses to abandon its old money-making machine, even if, as current sales figures show, that machine is beginning to smoke and leak oil. Instead, the industry has chosen to criminalize its more ardent customers. Very shrewd. And forward-looking.
It is, of course, a cliché to compare anything with Prohibition. Yet, there are two interesting lessons for this current situation to be learned from America's most famous attempt to criminalize American's mass participation in a low-grade misdemeanor.
The first is that once 10 million Americans do anything on a daily basis you aren't going to stop it. The second is that once you attempt to ruthlessly enforce such laws, you will only create martyrs and folk heroes while simultaneously driving the biggest players ever deeper underground into crime and civic corruption. We gave up on Prohibition 70 years ago, but we still have the Mob.
That child pornography is lurking around P-to-P sites is evidence that this process has already begun. Worse is coming. Meanwhile the RIAA is redoubling its efforts at enforcement, blind to the truth that it is already too much, too late.
Michael S. Malone, once called “the Boswell of Silicon Valley,” most recently was editor-at-large of Forbes ASAP magazine. His work as the nation’s first daily high-tech reporter at the San Jose Mercury-News sparked the writing of his critically acclaimed The Big Score: The Billion Dollar Story of Silicon Valley, which went on to become a public TV series. He has written several other highly praised business books and a novel about Silicon Valley, where he was raised.
Gartner Sees 38 Percent Flash Card Market Growth For 2003
September 11, 2003 (2:53 p.m. EST)
By Keith Ferrell, TechWeb News
Declining memory component prices won't slow revenue growth in the worldwide flash card market this year, research firm Gartner said Thursday.
In fact, lower NAND flash memory prices have prompted retail price-point drops that are fueling higher rates of consumer adoption of flash card technology, the company said. Based on first-half 2003 figures, Gartner projected a $2.75 billion global flash card marketplace, 38 percent larger than 2002's $1.99 billion.
Lower component prices have also made possible an increase in flash card capacity, further driving consumer enthusiasm for the devices, said Gartner analyst Joseph Unsworth..
“The [retail] sweet spot for flash cards in 2002 was 64 to 128 megabytes,” Unsworth said. “This year we're seeing the transition to 128 to 256 megabyte cards as the most popular size.”
The researcher expects capacity to continue to increase, with 512 megabyte flash cards projected as the most popular size by 2005.
In addition, market growth is being driven by both new and more demanding uses for flash storage, according to Gartner's “Worldwide Flash Card Market History and Forecast Trends, 2001-2007.”
Digital still cameras have been the primary drivers for the medium, with higher capacity cards being used to store either a larger number of photos or photos stored in higher resolution digital formats, which require more memory.
Unsworth said growing consumer interest in digital video recorders, with their even larger memory demands, could be a potential market-shaper in the next few years.
Even more important, he said, will be the adoption of next generation mobile phones.
“2.5G and 3G phones will bring a whole array of new capabilities including music clips and pictures, which require higher capacity flash cards,” Unsworth said. He pointed out that the technology has the added advantage of letting phone makers keep cost of manufacture and materials low. Smaller capacity cards can be bundled with the handset, letting consumers add capacity as desired.