BARCELONA, Nov 18 (Reuters) - In an attempt to make up with consumers whose PCs have been exposed to unsecure copy-protection software which acts like malware, music publisher Sony BMG said on Friday it would swap unsecure CDs for new unprotected disks as well as unprotected MP3 files.

The music publishing venture of Japanese electronics conglomerate Sony Corp. (6758.T: Quote, Profile, Research) and Germany’s Bertelsmann AG [BERT.UL] had already said last week it would temporarily suspend the manufacture of music CDs containing the controversial copy-protection technology.

The XCP copy-protection programme, developed by British software firm First4Internet and used by Sony BMG to restrict copying and sharing of music CDs, acts like virus software and hides deep inside a computer where it leaves the backdoor open for malicious hackers.

Sony BMG, after announcing a recall of some 4.7 million CDs with the software on Wednesday, said on Friday consumers could mail their CDs to the company, and they would receive a new unprotected CD in return.

Pending the processing of the exchange programme, consumers would also receive an email with details of a Website where they could download the music tracks as unprotected MP3 files.

Details of the swap programme can be found on http://cp.sonybmg.com/xcp/. Music CDs with the copy-protection software can be identified by a web address containing the letters XCP printed on the back of the box.

Last week the music publisher said it would do anything possible make amends with its customers who were outraged when the first viruses were discovered.

The XCP programme will have installed itself on a Windows-operated personal computer when consumers want to play 52 title CDs from Sony BMG. The vast majority of the CDs were sold in the United States.

The copy protection software has become a debacle for Sony BMG. Angry consumers filed a class action lawsuit, and Microsoft (MSFT.O: Quote, Profile, Research) said it regarded the copy-protection software as malware and would make a tool available to uninstall the programme. Sony BMG also said it will make a new uninstall tool available, after the first uninstall method proved unsecure.

In the latest twist to the story, software engineers found earlier on Friday that the music player which is part of the XCP software contains components from an open source project, an MP3 player called LAME, raising questions about copyright.

First4Internet, which sold the XCP software programme used by Sony BMG on its CDs, declined to comment after repeated requests since Monday.

Sony BMG has re-emphasised that copy-protection software is “an important tool to protect our intellectual property rights and those of our artists.”

TORONTO (CP) - It’s becoming a regular occurrence in CD shops across the country: an irate customer comes in complaining the CD they bought won’t play on their computer, and worse yet, they can’t transfer the tunes to their IPod.

The culprit is copy-protected or copy-controlled CDs - something many Canadian music retailers say they would like to see pulled from store shelves.

“This is just another really, really ridiculous way of telling our customers, ‘We don’t want your business,’ ” said Tim Baker of Sunrise Records, which has 31 shops in southern Ontario.

“It’s so stupid.”

The issue was underscored last week with news that the anti-piracy technology used on about 50 Sony BMG titles released in the United States and 37 in Canada secretly left spyware behind on people’s computers.

The software - developed as a way to fight music piracy - made the machines susceptible to viruses and hackers. And trying to remove the software disabled CD drives.

Needless to say, the technology irked consumers. Thousands flocked to the web to vent, using blogs and online petitions to encourage people to boycott Sony products altogether.

“There’s still plenty of work to be done if we are to achieve our goal of being treated like the music lovers we are rather than the criminals that (Sony) assumes us to be,” read one posting on www.boycottsony.us.

Sony BMG said Friday that about 120,000 of the 4.7 million faulty CDs were sold in Canada.

They are not the only company to issue copy-protected CDs in Canada.

EMI has been releasing select albums - including the latest Nickelback album, All The Right Reasons - this way for about three years. The company intends to ship out all its releases with the technology by year’s end.

The EMI discs use different software than Sony BMG, and have yet to cause any computer troubles.

Labels say they need the technology in order to stop people from sharing music with those who haven’t paid for it.

Still, retailers say such technology is punishing those who are actually willing to fork over cash for music - an ever-dwindling group as it is.

“Consumers are not liking it,” says Leslie Purchase, assistant manager at CD Plus in the Halifax Shopping Centre. “People are getting very frustrated by (copy-protected CDs).”

She’s noticed an increase in customers who put CDs down after noticing the “copy-controlled” or “copy-protected” label.

“A lot of customers won’t buy them now. They say ‘I don’t want it’,” she said.

The copy controls are possible through digital rights management technology, or DRM. It lets labels restrict the number of times a CD can be shared - meaning burned or copied.

More controversial is the ability to control which programs consumers can use to playback their music. With EMI and Sony BMG discs, for instance, the music is compatible only with Windows Media Player but not with ITunes (for PC users).

This is too funny not to read.

“Dear Pitchfork, I know we don’t always get along. Sometimes you make me second-guess myself, and cause me to wonder how I could possibly be a good card-carrying indie music lover if I don’t care for some of the crap you love. You even tell me I’m a bad person for listening to something I think really isn’t so bad. And frankly, when you compare my music to “a flaccid penis protruding out from beneath a fold of flesh on a balding, middle-aged man", well, that just hits a little too close to home. Let’s not make this personal and hurt each other any more than we already have.”

As you may already know LokiTorrent has ceased to exist instead the website has been replaced with an ominous warning, depicted below.

There are websites that provide legal downloads. This is not one of them.

This website has been permanently shut down by court order because it facilitates the illegal downloading of copyrighted motion pictures. The illegal downloading of motion pictures robs thousands of honest, hard-working people of their livelihood, and stifles creativity. Illegally downloading movies from sites such as these without proper authorization violates the law, is theft, and is not anonymous. Stealing movies leaves a trail. The only way not to get caught is to stop.

A Dallas federal court has ordered file-swapping site LokiTorrent.com to shut down and provide Hollywood lawyers with access to its full server logs, including data that could expose hundreds of thousands of people to copyright lawsuits.

The Motion Picture Association of America said Thursday that it had won a quick court victory against LokiTorrent, and was launching a new round of actions against other online piracy hubs. The data provided by the onetime file-swapping hub would provide “a roadmap to others who have used LokiTorrent to engage in illegal activities,” the trade group said.

Hard numbers on the site’s traffic are hard to come by. However, according to researchers at the Delft University of Technology, LokiTorrent was responsible for more than 800,000 downloads in the month of October alone.

MPAA executives said the information could “quite possibly” lead to lawsuits against individuals.

CHARLESTON, W.Va. – The recording industry sued Gertrude Walton, accusing her of illegally trading music over the Internet as “smittenedkitten.”

But the lawsuit was filed more than a month after the 83-year-old woman died in December, and her daughter says Walton hated computers, anyway.

A group of record companies named Walton as the sole defendant in a federal lawsuit, claiming she made more than 700 songs available for free on the Internet.

Walton’s daughter, Robin Chianumba, lived with her mother for the last 17 years and said her mother objected to having a computer in the house.

“My mother wouldn’t know how to turn on a computer,” Chianumba said.

She said she faxed a copy of her mother’s death certificate to record company officials several days before the lawsuit was filed, in response to a letter from the company regarding the upcoming legal filing.

“I am pretty sure she is not going to leave Greenwood Memorial Park (where she is buried) to attend the hearing,” Chianumba said.

A Recording Industry Association of America spokesman said Thursday that Walton was likely not the smittenedkitten it’s searching for.

“Our evidence gathering and our subsequent legal actions all were initiated weeks and even months ago,” said RIAA spokesman Jonathan Lamy. “We will now, of course, obviously dismiss this case.”

LokiTorrent is officially being sued by the MPAA (view) and is asking for donations. Unlike SupNova.org, the site has not folded under legal pressure to cease operation. The site has set a legal find goal of $30,000, however it is possible that may not be enough to cover all of the legal and operating costs.

“We’ve obtained copies of the MPAA lawsuit letters being circulated to Bit Torrent websites and their hosts - in this case to Torrent website “Demonoid” (Pages: 1,2,3,4,5,6,7). In it, lawyers warn the host they’ve sued the operators of a Torrent site on their network, but currently don’t know their identities. The letter to the website owner claims they face “severe sanctions” should they delete any pirated material or usable evidence in the case against them. As noted by users below, the IP address for the website cited by the letter (66.250.450.10) doesn’t/can’t exist, a mistake repeated throughout the letters.”

Source: DslReports.

A Canadian judge on Thursday set aside copyright rules that had imposed regulatory fees of as much as $25 on the purchase of iPods and other MP3 players in that country.

The country’s copyright regulators traditionally have imposed a small surcharge on media such as cassette tapes and blank CDs, using the revenues to pay musicians and record labels whose works are being copied at home by consumers. Late last year, the Copyright Board applied this to MP3 players, which they said consumers also used for “private copying” of music.

A coalition of retailers and electronics manufacturers sued, saying the ruling was unfair. In a decision released Thursday, federal Judge Marc Noel ruled that the MP3 player fees did not seem to be supported by the letter of the law, and set them aside.

“It is for Parliament to decide whether digital audio devices such as MP3 players are to be” included, he wrote.

The decision marks a victory for retailers, manufacturers and sticker-shocked consumers in the country, even if its effect might be temporary. However, it did uphold the foundation of the country’s private copying rights, which courts have used as grounds to say consumer file-swapping is legal.

That series of decisions has put the country’s legal system at odds with much of the rest of the world, which is cracking down on operators and users of peer to-peer networks with criminal and civil penalties. Record labels have appealed the file-swapping decision.

The MP3 player ruling will likely mean a quick drop in prices for iPods and other devices in Canada. The board’s decision last year imposed a $25 fee on players with more than 10GB of memory, $15 for players above 1GB, and $2 for smaller players.

The shoppers’ reprieve may not last forever, however. The judge made it clear that he was sympathetic to the Copyright Board’s attempt to impose the fees on MP3 players. Devices such as iPods are in fact used to copy large amounts of music and could potentially do more damage to copyright holders’ interests than ordinary blank CDs or cassettes, he said.

“However, as desirable as bringing such devices within the ambit of the (fees) might seem, the authority still has to be found in the” law, he said.

The parents of a 13-year-old girl are suing US supermarket giant Wal-Mart over a CD by rock group Evanescence that contains swear words.

The lawsuit, filed in Washington County, alleges Wal-Mart deceived customers by not putting warning labels on the cover.

Trevin Skeens alleges Wal-Mart knew of the offending word because it had censored it on its music sales website.

Wal-Mart said it was investigating the claims but had no plans to pull the CD.

Wal-Mart has a policy of not stocking CDs which carry parental advisory labels.

Mr Skeens said he bought the Anywhere But Home CD for his daughter and was shocked to hear the swearing when it was played in their car.

Damages claim

“I don’t want any other families to get this, expecting it to be clean. It needs to be removed from the shelves to prevent other children from hearing it,” said Mr Skeens of Brownsville.

The lawsuit seeks to force Wal-Mart to censor the music or remove it from its stores in Maryland.

It also seeks damages of up to $74,500 (£38,660) for every customer who bought the CD at Maryland Wal-Marts, and also naming record label Wind-Up Records and distributor BMG Entertainment in the legal action.

“While Wal-Mart sets high standards, it would not be possible to eliminate every image, word or topic that an individual might find objectionable,” Wal-Mart spokesman Guy Whitcomb told the Herald-Mail of Hagerstown.

update The U.S. Supreme Court on Friday said it would hear a controversial case on whether file-sharing software companies could be held legally responsible for copyright infringement on their networks.

The court’s action is good news for big record labels and Hollywood studios, which have lost successive rulings on the issue in lower courts. They want software companies like Morpheus parent StreamCast Networks and Grokster to be held legally responsible when copyrighted material is swapped using their software.

“There are seminal issues before the court–the future of the creative industries and legitimate Internet commerce,” Mitch Bainwol, chief executive officer of the Recording Industry Association of America, said in a statement. “These are questions not about a particular technology, but the abuse of that technology by practitioners of a parasitical business model.”

The court’s decision could also be a sobering sign for technology companies well outside the world of file-swapping. At the core of the case is an interpretation of a 20-year-old decision that made VCRs legal despite their ability to copy TV shows and movies, which ultimately helped pave the way for a host of technologies ranging from CD burners to Apple Computer’s iPod.

That case, known as the Sony-Betamax decision, set out rough guidelines under which technology used to make illegal copies of copyrighted material could be distributed without the manufacturer being responsible for the resulting piracy, as long as the product was also capable of “substantial noninfringing uses.”

That’s been enormously influential for computer and consumer electronics makers over the past few years, particularly as music and movies have been turned into easily copied digital formats. Indeed, all MP3 player makers, including Apple, owe their recent history to a 1999 decision in which a judge said MP3 players were capable of playing legally purchased music, and were therefore legal.

“I don’t think anybody had a clue how significant that decision was when it came out,” said Jim Brelsford, an attorney at Jones Day. “So many things turned out to be built on that.”

Some in Silicon Valley fear that a Supreme Court ruling aimed at reining in file-swapping could have unintended impacts on future product development.

“There’s a lot more at stake here for the technology industry than for the copyright industry,” said Fred von Lohmann, an Electronic Frontier Foundation attorney who has represented StreamCast Networks on the issue. “This case will not be determinant of the future of peer to peer around the world, but it will be determinant of the future of a whole host of future digital products.”

The case itself focuses on Morpheus and Grokster, each of which are popular file-swapping applications that are widely used to trade movies, music and software.

Studios and labels sued the companies in 2001, following successful legal campaigns against peer-to-peer trailblazer Napster. Attorneys for the entertainment conglomerates said the newer file-swapping services were, like Napster, building businesses based on copyright infringement.

But Grokster and StreamCast were built around a different technology than Napster. Their services involved a highly decentralized network of individual computers trading files among themselves, rather than a network controlled from a central location.

Lower court judges ultimately said that the companies did not directly control what happens on their networks, and that their software could be used for legal purposes. That shields the companies themselves from legal responsibility for the actions of their users, the lower courts said.

A UK magazine printed an interview two weeks before former Pantera guitarist Darrell Abbott was shot and killed, saying he should be “severely beaten".

Metal Hammer published the interview with singer Phil Anselmo, who featured in Pantera with Abbott.

Abbott was one of five people killed in Ohio as his band Damageplan performed.

A spokesman for publisher Future said it was “really sorry” to hear of the deaths, adding: “We extend our sympathies to the families involved.”

Metal Hammer
The cover features Anselmo with two knives
Abbott, nicknamed “Dimebag", and three others were shot when a man stormed the stage at the Alrosa Villa Club in Columbus and began firing at the band and crowd.

Nathan Gale, 25, was then shot and killed by a police officer who arrived shortly after the first shots were fired.

The other men killed were named as club employee Erin Halk, 29, fan Nathan Bray, 23, and Jeff Thompson, 40, who was affiliated with the band.

Two other people were taken to hospital following the incident but their condition is unknown.

Anselmo, who is now lead singer for Superjoint Ritual, was interviewed in the Christmas edition of the magazine, talking about the acrimonious break-up of Pantera.

Motive

No motive has yet been established for the killings, although Columbus police have said witnesses had described hearing Gale accuse Abbott of being behind the split of Pantera.

“He deserves to be beaten severely,” Anselmo told the magazine, which is not published in the US.

The magazine’s cover features Anselmo brandishing two knives at the camera.

Ozzy Osbourne
Ozzy Osbourne often toured alongside Pantera
Pantera were one of the most popular metal bands of the early 1990s, topping the US album charts and getting a Grammy nomination for 1994 release Far Beyond Driven.

A spokesman for Future said it had no further comment to make.

Rock legend Ozzy Osbourne was one of many in the rock world who paid tribute to Abbott.

The Black Sabbath frontman, who often toured with the 38-year-old, said: “I’m absolutely beside myself with grief.

“I can’t for the life of me understand why someone would do this.”

Four thousand two hundred and eighty lawsuits and counting.

“That’s how many lawsuits have been brought by the major record labels against music fans for using peer-to-peer (P2P) file-sharing software (like Kazaa or Morpheus) to swap music over the Internet. This month marks the one-year anniversary of the recording industry’s unprecedented litigation campaign against its own customers. The campaign appears to have hit its stride, with the Recording Industry Association of America announcing roughly 500 new suits each month.”

link…

Sen. Orrin G. Hatch (R-Utah), Chairman of the Senate Judiciary Committee, commended the Senate’s passage of S. 3021, the “Family Entertainment and Copyright Act of 2004″ and issued the following statement:

“This comprehensive legislation will enhance the enforcement and operation of the intellectual property laws so critical to our economy and our future.

“We must do everything in our power to ensure that our intellectual property is protected. As technology develops and changes, our role in Congress is to update our federal laws. This comprehensive package is the result of careful, bipartisan negotiations.

“I want to commend the Senate for passing S. 3021, the ‘Family Entertainment and Copyright Act of 2004.’ This important legislation is actually a package of several intellectual property bills that the House and Senate have been working to enact over the past two years. This bill strengthens the intellectual-property laws that are vital to the ongoing growth of our economy.

“Title I of this Act, the Artists’ Rights and Theft Prevention Act of 2003, (the ART Act), will close two significant gaps in our copyright laws that are feeding some of the piracy now rampant on the Internet. First, it criminalizes attempts to camcord movies off of theater screens. These camcorded copies of new movies now appear on filesharing networks almost contemporaneously with the theatrical release of a film. Second, the bill will create a pre-registration system that will permit criminal penalties and statutory-damage awards when copyrighted works are distributed illegally via the Internet before they are even made available for sale to the public.

“Title II of this Act, the Family Movie Act of 2004, resolves some ongoing disputes about the legality of so-called “jump-and-skip” technologies that companies like Clearplay in my home state of Utah have developed to permit family-friendly viewing of films that may contain objectionable content. This will ensure the future of technologies that enable families to watch movies without exposing their children to profanity or images of rape, sex or murder.

“Title III of this Act, the National Film Preservation Act of 2004, will reauthorize the National Film Preservation Board and the National Film Preservation Foundation. These entities recognize and preserve historically or culturally significant films – often by providing grants and expertise that enable local historical societies to preserve historically significant films for their local communities. This work will preserve the history of the 20th century for future generations.

Title IV of this Act, the Preservation of Orphan Works Act, also ensures the preservation of valuable historic records by correcting a technical error that unnecessarily narrows a limitation on the copyright law that protects librarians and archivists.

Title V of this Act, the Anticounterfeiting Act of 2004, strengthens our criminal and civil anticounterfeiting laws. Traffic in counterfeit copies of American goods has become a multi-billion dollar drain on our economy. Companies are combating this counterfeiting by using increasingly sophisticated authentication features to distinguish genuine, authorized copies of their products. Now, the crooks are stealing or forging these authentication features and selling them to counterfeiters. The Anticounterfeiting Act of 2004 will impose criminal and civil penalties upon those who traffic in counterfeit or stolen authentication features. This will help halt criminal traffic in authentication features before it can create the illusion of authenticity that allows counterfeit goods to penetrate legitimate markets and endanger our citizens and economy.

“Title VI of this Act, the Cooperative Research and Technology Enhancement Act of 2004 (the CREATE Act), will help public institutions and private entrepreneurs combine their expertise in collaborative, joint research efforts. Unfortunately, the literal language of Section 102(g) of the Patent Act could create a disincentive to form public-private joint-research projects.

“I believe that we must encourage – not discourage – public institutions and private entrepreneurs to combine their differing talents in joint research efforts. Indeed, Congress committed itself to this principle when it passed the Bayh-Dole Amendments to the Patent Act. The CREATE Act will simply conform the present language of the Patent Act to its intent.”

The U.S. Department of Justice has targeted a group known as the Underground Network for its first criminal investigation into intellectual property piracy over peer-to-peer (P2P) networks.

Direct Connect, P2P software developed by NeoModus, enables the network.

A Justice Department official told internetnews.com that neither NeoModus nor its technology were under investigation. Last week, a U.S. Appeals Court upheld a lower court ruling that P2P software is legal even if it can be used in an illegal manner.

Instead, the probe is focusing on a specific network of Direct Connect users that requires its more than 7,000 members to make anywhere from 1 to 100 gigabytes of media available for other members.

During a media briefing Wednesday, Attorney General John Ashcroft said “virtually every kind of software, game, movie and music was available for illegal downloading and distribution on these networks, from computer games and music that would cost as much as $18 to $35 dollars if purchased legitimately, to specialized software that has a retail cost in excess of $1,000.”

Ashcroft authorized search warrants Wednesday morning involving an Internet service provider and five individuals in Texas, New York and Wisconsin. Computers, software and computer-related equipment were confiscated in the raids. No charges have been filed.

According to an FBI affidavit in support of the search warrants, the Underground Network Web site is hosted on a server located in San Antonio, Texas. The hubs on the network are located both in the U.S. and abroad. The affidavit states that the network has 55 staff positions including hub operators and moderators and network administrators.

Users access the site by downloading Direct Connect software and then connecting to the Underground Network. There is no fee to join the network and members are provided with access to a list of hub sites on the network.

Through what the FBI called “online covert operations and traditional investigative techniques,” authorities said they were able to identify the leadership of the network and the organizational structure of the U.S. hubs. Five of those hubs and their operators are the subject of the DOJ investigation.

After an undercover FBI agent joined the Underground Network, he was able to download 72 gigabytes of copyright protected material from the five sites. The FBI says the material consisted of approximately 84 movies, 40 software applications, 13 games and 178 sound recordings.

Since last September, the Recording Industry Association of America (RIAA) has filed copyright infringement civil suits against almost 7,000 individuals using P2P applications on the public file-sharing sites of Kazaa, Grokster, Morpheus, eDonkey and others, but Ashcroft’s Wednesday announcement marks the first criminal investigation into P2P networks.

The maximum penalty for criminal copyright infringement for a first-time offender is up to five years in prison and a fine of $250,000.

“P2P does not stand for ‘Permission to Pilfer.’ Illegal distribution and reproduction of copyrighted material is a serious criminal offense,” Ashcroft said. “Today’s investigative action sends a clear message to online thievesand those who think nothing of downloading those stolen goods to their computers and MP3 players.”

Ashcroft added, “You can pay the fair value for music, movies, software and games like every other consumer, or you can pay an even higher price when you are caught committing online theft.”

WASHINGTON — Internet providers must abide by music-industry requests to track down computer users who illegally download music, a federal judge ruled yesterday in a case that could significantly increase online pirates’ risk of being caught.
The decision by U.S. District Judge John Bates upheld the recording industry’s powers under a 1998 law to compel Verizon Communications to identify an Internet subscriber who was suspected of illegally trading music or movies online. The music industry knew only the person’s numerical Internet address. The ruling means consumers using dozens of popular Internet file-sharing programs can more easily be identified and tracked down by entertainment companies trying to prevent the illegal trading of movies and music. For consumers, even those hiding behind Internet aliases, that could result in warning letters, civil lawsuits or criminal prosecution.

Verizon promised to appeal and said it would not immediately provide its customer’s identity.

Coming soon to a computer near you – Hollywood Hackers.

Watch as they rifle through your files, dismantle your network, and delete all those songs and movies you can’t prove have a legal right to exist on your hard drive. Hope the special effects don’t include the accidental destruction of your data when your computer becomes a stunt double in Hollywood’s latest blockbuster attempt to protect its copyrighted material.
California Congressman Howard Berman introduced his “Peer-to-Peer Piracy Prevention” Act in the House of Representatives Thursday. If the bill passes, copyright owners could – at least conceptually – employ a variety of technological tools to prevent the illegal distribution of their copyrighted works over a P2P network such as Kazaa or LimeWire.

Security experts said the bill’s wording is too vague and wonder exactly what sort of “technological tools” will be permitted. They also fear that approval of the bill could result in a multitude of clumsy and ill-conceived “hack” attacks that could have widespread, system-damaging effects on both file traders and those who have never downloaded a single song from a file-trading server.

“Basically, Berman is going to legalize all of the antisocial Internet activities that we have been trying to stamp out for the last decade,” said Paul McNabb, chief technical officer of security firm Argus Systems Group.

While not specifically prohibited in the bill, Berman insists that media companies will not be allowed to unleash viruses or other malicious code or destroy personal, non-pirated files.

“Contrary to widespread, if uninformed speculation, our legislation is narrowly crafted, with strict bounds on acceptable behavior by the copyright owner,” Berman said in a statement. “It gives copyright creators a very limited safe harbor from liability when they use technological tools for the narrow purpose of thwarting P2P piracy. It does not allow copyright owners to send viruses through P2P networks, destroy files, hack into the personal files of P2P users, or indiscriminately block lawful file-trading.”

The tools Berman specifically suggested that companies might use include “interdiction” – flooding a P2P file server with fake requests in order to slow or stop the system; “spoofing” – providing slews of corrupt, damaged or incomplete files to P2P servers; and “redirection” – faking the location of files to force traders to perform many futile system-resource-wasting searches.

But media companies wouldn’t be limited to just those options.

“The bill is pretty vaguely worded so it’s hard to know what Hollywood might do,” security researcher Richard Smith said.

Smith guessed that, at minimum, media companies could overwhelm P2P servers with “ghost files,” tying up the servers’ resources as people try to download files that don’t really exist.

“Another possibility would be to overload someone’s computer by repeatedly requesting the same illegal file to be downloaded,” Smith added.

Denial-of-service attacks, flooding servers with many requests for nonexistent files in order to crash or dramatically slow network performance, is specifically permitted under the bill. But P2P networks are created on the fly from whatever computers are logged on at any given time, so experts fear that innocent bystanders could also be smacked in a service attack.

“Berman is opening the door to massive denial-of-service attacks against perceived pirates, without the attacker having to get prior authorization to launch the attack,” Argus’ McNabb said. “This could have devastating effects on computers on the same network or in the line of fire.

“For instance, if everyone on your block has a cable modem, and someone is thought to be a pirate, a denial-of-service attack against that perceived pirate could take the entire neighborhood cable network down.”

Security experts also wondered how Hollywood would come up with a battalion of skilled hack attackers. Would the pirate-battling forces be unassuming programmers, now ordered to come up with malicious programs to foil file traders? Or would Hollywood soon be hiring real hackers?

“If you hire average programmers and set them to work coming up with ideas on how to punish a pirate, you’ll eventually get into trouble if you don’t know what you’re doing and don’t strictly control them,” said George Smith of virus information site Vmyths.

“There is no set definition of a ‘virus’ in the Internet mind, so it is easy to imagine a corporate programmer convincing his bosses and the legal department that his copy protection scheme is not a virus, only to find that when it gets into distribution and is taken apart by someone in the industry the first time it swats an innocent, it is labeled as something very bad.”

Hackers said that very few of their skilled colleagues would consider taking pirate-persecuting jobs.

“I don’t think Hollywood has a hell of a lot of support within the hacking community, so finding real talent might be a bit tough,” hellNbak, a member of hacker laboratory Nomad Mobile Research Centre said. “That being said, there are always those who will, if the price is right, offer help and training.”

Security experts also agreed that the Berman bill could serve as encouragement to a whole new class of criminals, drawn from the lowest common denominator of the computer underworld.

Under what security consultant and author Richard Forno calls the “Hollywood Hacking law,” computer criminals could probably make the case that any malicious programs they wrote and released were actually intended to scour the Net to enforce copyrights.

“What a wonderful cover-your-arse law this will be for script kiddies and other cyber-cretins,” Forno said.

Forno also wondered whether network administrators and computer owners would eventually be penalized for running secure systems.

“Will having a firewall – or implementing strong system security practices or being a good system administrator – become illegal and prosecuted as circumventing copyright controls under the existing Digital Millennium Copyright Act? If Hollywood can’t easily inspect your system in their quest for copyright enforcement and world control, are you now a criminal suspect?”

“Be afraid.” Forno added. “Be very afraid.”

Legislation meant to thwart unauthorized downloading on certain peer-to-peer networks will still allow major media companies to offer file-trading through their own systems.

Rep. Howard Berman (D-California) introduced his much anticipated peer-to-peer legislation in the House of Representatives on Thursday.

The proposal would give copyright owners, from Hollywood studios down to independent musicians, the legal go-ahead to employ a variety of technological measures that would stop computers hooked up to decentralized networks from trading. That would be bad news for users of Gnutella and Kazaa. In the interim, it would allow companies like Overpeer, which floods decentralized networks with bogus files, to flourish. In the long run, it also would make any system that doesn’t have a central location – and most open-source networks don’t have a central location – vulnerable to attack.

Individuals affected by copyright owners’ attacks would feel the effects of the legislation immediately, as their systems could be assaulted with no notice.

If the attack was somehow a case of mistaken identity, recourse would be difficult. Individuals would have to petition the Attorney General for a private investigation. After the initial request, the agency would have four months to look into the matter.

The unprecedented breadth of technology the copyright industry could use was welcome news to those in the music industry who have battled peer-to-peer networks since 1999.

“The current landscape for online music is dangerously one-sided, with the peer-to-peer pirates enjoying an unfair advantage,” said Hilary Rosen, CEO of the Recording Industry Association of America. “It makes sense to clarify existing laws to ensure that copyright owners – those who actually take the time and effort to create an artistic work – are at least able to defend their works from mass piracy.”

The five major record labels have struggled to launch their online music subscription services – MusicNet and Pressplay – over the last year, blaming the availability of networks that allow people to download music for free.

Along with making it open season on individual users, open-source programs and decentralized networks, the bill also gives a free pass to chat applications run by the very media companies that would most benefit from open-source networks being shuttered.

AOL Instant Messenger (AIM), MSN Messenger and Yahoo Messenger – which each have specific file-trading options built into their systems that enable millions of users to trade their share without fear of electronic attack – will continue to flourish. The recording industry and movie studios have largely ignored those three chat applications, which have financial ties to the major record studios and movie studios, in their litigation and anti-piracy activities.

“What this bill has said is that what is good enough for the Internet isn’t good enough for AOL,” said Fred von Lohmann, an intellectual property lawyer with the Electronic Frontier Foundation. The EFF is providing legal support to StreamCast Networks, the company that distributed the Morpheus file-trading software, in its legal battle with the Recording Industry Association of America. “This is hands-off for AOL’s network. It’s not a coincidence that AOL is a division of Time Warner.”

America Online, which distributes AIM, is a subsidiary of AOL Time Warner. Yahoo signed a licensing agreement with the recording industry, giving it permission to create audio webcasts of popular music. Microsoft has developed a rights-management technology that several studios and record labels use to protect their products.

Not every messenger company escaped the legal wrath of the copyright industry. Aimster, which allowed AIM users to share files before the ISP created its own file-trading chat application, lost its domain name and teeters on financial ruin after facing a series of infringement lawsuits.

The spotty nature of litigation and selective targeting of companies has even supporters wary.

The Association for Competitive Technology, a trade organization representing information technology companies, including Microsoft, praised the spirit of the bill but offered tempered support for its specifics. It will continue to support the bill as long as it protects instant messaging products, ACT president Jonathan Zuck said in a letter to Berman.

Despite the popularity of file-trading applications, instant messenger programs may actually pose a bigger threat to record companies and movie studios concerned about curtailing downloading. At its height, the Napster network handled just under three billions files a month, where AIM has one billion files a day zipping across its system.

In his now infamous speech last March, Michael Green, the head of the Grammy organization, denounced file-trading as a threat to the music industry. He then announced that three students had downloaded over 6,000 files in three days at the behest of the National Academy of Recording Artists (NARAS).

It appeared to be a dramatic moment, until The New York Times reported that two of the three students hadn’t used file-trading applications like Gnutella and Kazaa. Instead, they used AIM to download their music.

File-trading networks have little recourse with this legislation, as most have few resources in Washington, D.C. Like Napster before it, the companies must appeal to users, hoping to shroud themselves in a blanket of swappers who’ll flood the halls of Congress with e-mails and letters demanding the government keep its hands off their computers.

While Napster unsuccessfully battled the record labels through federal district and appeals court, the company set up a website that allowed its users to communicate with their representatives. Today, Sharman Networks put out a similar call.

“We urge all users and supporters of technology innovation to contact Congress and voice strong opposition to this entertainment industry effort to gain exemption from the law and take malicious action against consumer’s privacy and other rights,” said Sharman Networks, the company that distributes the Kazaa file-trading application, which can be attacked under the Berman bill.

RIAA, NMPA Reach Settlement With Audiogalaxy.com

New York, NY, June 17, 2002 - The recording industry, music publishers and songwriters announced today that they have reached an out-of-court settlement with Audiogalaxy.com, the Napster-like clone, which requires Audiogalaxy to stop the infringement of copyrighted works on their peer-to-peer network.

The agreement follows a lawsuit filed in late May accusing Audiogalaxy of facilitating and encouraging widespread copyright infringement - a last resort step after repeated efforts to warn the firm of their liability were ignored or resulted in ineffective attempts to fix the problem. The suit was brought by the Recording Industry Association of America (RIAA), on behalf of its member labels, and the National Music Publishers’ Association (NMPA), on behalf of the music publisher principals of its licensing affiliate, The Harry Fox Agency, Inc. The settlement reached would allow Audiogalaxy to operate a “filter-in” system, which requires that for any music available, the songwriter, music publisher, and/or recording company must first consent to the use and sharing of the work. The other key provision of the agreement is for Audiogalaxy to pay the music publishers and recording industry a substantial sum based on Audiogalaxy’s assets and interest in resolving this case quickly.

“We are pleased to settle this case quickly. This is a victory for everyone who cares about protecting the value of music,” said Hilary Rosen, Chairman and CEO of the RIAA. “This should serve as a wake-up call to the other networks that facilitate unauthorized copying. The responsibility for implementing systems that allow for the authorized use of copyrighted works rests squarely on the shoulders of the peer-to-peer network.”

“The message is clear – there is no place on the Internet for services that exploit creators’ work without fair compensation,” added Edward P. Murphy, President and CEO, NMPA. “Such services hurt creators and hurt the legitimate Internet businesses that wish to comply with the law and compensate the creators. The swift resolution of this matter is thus a double victory that creators and legitimate Internet businesses should join in hailing.” (more)

Audiogalaxy.com, based in Austin, Texas, was one of the more heavily trafficked file-sharing websites.

The Recording Industry Association of America is the trade group that represents the U.S. recording industry. Its mission is to foster a business and legal climate that supports and promotes our members’ creative and financial vitality. Its members are the record companies that comprise the most vibrant national music industry in the world. RIAA® members create, manufacture and/or distribute approximately 90% of all legitimate sound recordings produced and sold in the United States.

In support of this mission, the RIAA works to protect intellectual property rights worldwide and the First Amendment rights of artists; conduct consumer industry and technical research; and monitor and review - - state and federal laws, regulations and policies. The RIAA® also certifies Gold®, Platinum®, Multi-Platinum™, and Diamond sales awards, Los Premios De Oro y Platino™, an award celebrating Latin music sales.

The National Music Publishers’ Association, Inc., founded in 1917, works to protect and advance the interests of the music publishing industry. With over 900 members, the NMPA represents the most important and influential music publishing firms throughout the United States.

The Harry Fox Agency, Inc. provides an information source, clearing house and monitoring service for licensing musical copyrights, and acts as licensing agent for more than 27,000 music publisher principals, who in turn represent the interests of more than 160,000 songwriters. Besides the core business functions of licensing, collections and distribution of royalties, HFA conducts periodic record company and other user audits on behalf of its principals. HFA is the licensing affiliate of the National Music Publishers’ Association.

Eminem could become the latest high profile artist to have his album protected against copyright infringement.

The controversial rapper and his Universal label are in talks to release the forthcoming The Eminem Show with technology that would prevent widespread copying.

The record label is also being extremely cautious about where promotional copies of the album’s first single, Without Me, are going, fearing leaks on to the internet will affect sales.

If Universal go ahead with the plan, it would mark the company’s biggest attempt to protect its artists from piracy.

There has been a strong push from the major labels towards copy-proof material but until now it has tended to be on a limited basis.

Sales slump
Albums from Celine Dion, *N Sync and Natalie Imbruglia have all had technology added to prevent them being copied.

The widespread leak on to the internet of the Oasis comeback album Heathen Chemistry will further add fuel to the industry’s concerns about piracy.

Eminem’s third album is due for release on 3 June, so any decision on copyright protection will need to be taken swiftly.

Piracy has recently been blamed for a 5% drop in the world’s music sales.

The music industry took quick action to try and halt the illegal downloading of music from the internet which can easily be copied on to CDs.

Consumer complaints
Sites such as Napster were shut down by legal wrangles because unlicensed music was being swapped on its service.

But some consumers have complained that albums with anti-piracy equipment attached have hindered their ability to play them on their computers or in-car stereos.

Because it has not been used on such an eagerly awaited album before, it has been difficult to gauge reaction.

“Clearly, we will have a better sense of how the market feels about copy-protection when a release of Eminem’s stature, should we decide to do it, comes with copy-protection on it,” said Universal Music spokesman Adam White.

“Mass-copying has gotten to such a level that we had better take a stand to protect the artists,” he added.

Recent years have been pretty lean for the Sugar Hill Gang when measured against more financially successful rappers. But now that a New York District Court judge has awarded the hip-hop pioneers nearly $3 million — in a case against the Snapple Beverage Corporation and Turner Broadcasting System Inc. — the Gang will no longer have to eat at friends’ houses where “the macaroni’s soggy, the peas are mushed, and the chicken tastes like wood."Those culinary catastrophes are bemoaned in the group’s legendary single “Rapper’s Delight,” a live video performance of which Snapple and Turner were found guilty of unlawfully pilfering in a 1998 ad for the Goodwill Games, an event produced by Turner.

In a case filed in January 1999, the Sugar Hill Gang claimed it was told the performance in question would only be broadcast by Snapple on closed-circuit monitors during a party at Studio 54. The rappers said they were shocked to later see the clip used for the Goodwill Games.

“A month after we did the show, I get calls congratulating me on my new commercial,” said Gang member Joey Robinson Jr. “I went, ‘What are you talking about?’ We never consented to it, we never got paid for it, and Snapple never wanted to settle with us.”

In court, both Snapple and Turner claimed the group knew in advance that footage would be used for television advertisements, but the judge sided with the rappers. In June he granted a summary judgement on behalf of the Sugar Hill Gang, and on Friday a jury awarded it $165,000 in compensatory damages and another $2.8 million in punitive damages.

“It was a blessing,” Robinson said. “It was like three-and-a-half years of fighting had finally come to a head. It was a cheerful joy of happiness.”

Snapple and Turner did not return calls for comment.

Recently, the Sugar Hill Gang appeared in a commercial for Coca-Cola that they were actually paid for, and in January the group will return to the studio to finish its first album of new material in 21 years.

“It’s not gangsta at all,” Robinson said. “It’s a little bit like Will Smith, a little bit Sisq󠦡mp;#8212; like a ‘Thong Song.’ It’s got a little Aersomith/Run-D.M.C. flavor. We did a remake of [Def Leppard’s] ‘Pour Some Sugar on Me’ that’s really hot. The album won’t confuse people, so they’ll know it’s Sugar Hill Gang, but it’s updated to what’s happening now.”

The group has recorded seven of 13 songs, including a duet with LFO called “Girl I Want You,” and there are plans to record a new song with ‘NSYNC, whom the Sugar Hill Gang opened for during 1999 and 2000.

“They want to do a record with us, and we want to do one with them, so we’re getting some tracks together to submit to them,” Robinson said. “Those guys are great guys.”

Also, the Sugar Hill Gang is trying to recruit Def Leppard to contribute to the “Pour Some Sugar on Me” cover. But that’s not the most surprising development for the old-school rappers — in March they’ll play what might be their strangest venue to date.

“We were just with Liza Minnelli at her private party with [event producer] David Gest, and David asked us to perform in March for their wedding,” Robinson marveled. “He said, ‘Joey, please, I’m gonna ask you, would you mind performing?’ And I said, ‘Are you kidding? It would be an honor.’ “

Needless to say, nobody from Snapple is invited, and the event will not be broadcast on Turner.

By all rights, it should be a banner few months for digital music.
A high-powered new generation of digital music players is heading for Christmas stockings. Almost simultaneously, the major record labels are releasing their catalogs online after years of stalling. Unfortunately, the two campaigns might as well be happening on different planets. People using hot new music devices such as Apple Computer’s iPod or Compaq Computer’s iPaq will not be able to play music from the Pressplay and MusicNet subscription services, which for the first time will make songs legally available online.
The disconnect speaks volumes about the fragmented state of the so-called digital rights management industry, which provides anti-piracy technology. Consumer electronics companies that once paid some lip service to helping fight digital music piracy are now releasing products that will boost demand for the huge amount of free–if legally questionable–music still available online.

Artcile from CNET News.com