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Date: Friday, October 06, 2000, 4:01 PM -0400
From: Faulkner Information Services <mailserver@faulknerinfo.com>
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Subject: Faulkner's Cyberscape Digest 10/06/00



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CyberScape Digest

CyberScape Digest is a weekly roundup of top internet stories. This issue
covers events from Monday 10/02/00 through Friday 10/06/00. 

  
America Online, Time Warner, EMI Deal With Merger Woes, Privacy Issues
Antitrust regulators with the European Commission proved obstinate in their
consideration of America Online's proposed merger with Time Warner, and
Time Warner's proposed merger with EMI Group. Despite a number of
concessions offered by Time Warner and EMI, including the sacrifice of
Virgin Records, the EC set itself to block the TW-EMI merger. If the deal
had gone through, it would have reduced from five to four the number of
major music distribution companies in the world. Seeing a losing battle
ahead of them, Time Warner and EMI called off their merger plans, clearing
the way for the commission to approve Time Warner's merger with America
Online. Observers expect a decision from the EC as early as October 11.
Meanwhile, the merger partners wrote two letters defending their
transaction: one specifically addressing concerns raised by Walt Disney and
other rivals, and one pleading with the Federal Communications Commission
not to place conditions relating to AOL's Instant Messenger on the merger.
Strangely, bitter rivals AOL and Disney found themselves on the same side
at least once this week. Both gave testimony to a Senate panel concerning
privacy bills; both support the government passing enforceable privacy
standards for commercial Web sites. Both also want the government to not
mandate an "opt-in" standard, proposed in at least one of the bills under
consideration.

   

Alliance and Joint Venture Agreements
Worldwide telecom firm Cable &Wireless and Nortel Networks entered into a
10-year $1.4 billion contract, through which Nortel will change C&W's
switched network to voice over IP (VoIP) and manage the modified network
through Nortel's Global Professional Services organization. Plans call for
the C&W VoIP backbone network to be implemented across North America and
Europe. Meanwhile, the mobile phone unit of Spanish telecom Telefonica
struck a deal with Hewlett-Packard, whereby HP will provide mobile
e-services, as well as hardware and software to for joint development of
new Internet-enabled mobile phone applications and services. In the DSL
sector, Connecticut-based DSL.net extended its symmetric digital subscriber
line service to small- to- medium-sized businesses in 52 new areas,
including cities such as Vegas, NV; Buffalo, NY; Albuquerque, NM; Carmel,
CA; and Kansas City, MO.  

  

Carnivore Review: "Whassup?"
Resulting from a Freedom of Information Act lawsuit it filed, privacy
advocacy group Electronic Privacy Information Center (EPIC) received the
first of several installments of documents to be released by the FBI
concerning the Carnivore e-mail surveillance system. EPIC reported that, of
the 565 pages released, almost 200 were withheld in full and another 400
were redacted, many completely so except for page numbers. The documents
relate to the system's February 1997 origin as Omnivore, discussion of
interception of voice over IP (VoIP), and various testing procedures. The
source code to the Carnivore system was withheld. Stating that its FOIA
request was for public release of all Carnivore records, including source
code and legal analyses of Carnivore's potential privacy implications, EPIC
stressed its resolve to pursue litigation until "relevant" documents are
forthcoming. Also this week, the ACLU criticized the Federal government's
selection of academic experts reviewing security, reliability, and Fourth
Amendment issues relating to Carnivore, saying that many of them have ties
to the federal law enforcement agencies and the White House. The ACLU
claims that the review team chosen at the Illinois Institute of
Technology's Research Institute consists of a large number of White House
insiders, including a former Clinton information policy advisor and a
former Justice Department official, as well as members with backgrounds in
the National Security Agency, the Department of Defense, and the Department
of the Treasury. Underscoring the irony of the situation, ACLU Associate
Director Barry Steinhardt said, "By selecting people with extensive
government ties for what is supposedly an independent review, the Executive
Branch has shown once again that it cannot be trusted with carte blanche
authority to conduct searches."  

  

Baltimore Technologies Snaps Up Nevex
UK-based electronic supply firm Baltimore Technologies agreed to acquire
smaller Canadian security company Nevex Software Technologies in a stock
deal valued at $42 million. Baltimore seeks to enhance its offerings with
the addition of Nevex' secure e-business authorization technology, which is
designed to enable organizations to centrally manage security policy. 

  

Government Actions Influencing the Internet
Addressing the shortage of skilled labor affecting high-tech firms,
Congress voted Tuesday to up the quantity of number of H-1B temporary visas
available for highly skilled from foreign countries. Passing by a voice
vote in the House and a 96-1 tally in the Senate, the legislation will
raise the number of available visas for the next three years to 195,000 per
year. Under existing law, 115,000 visas were available in 2000. The new law
also makes more money available, via increased visa application fees, for
education and job training initiatives to upgrade the technical skills of
American workers. In other developments, the Commerce Department selected a
new encryption technique to replace the current DES standard technique that
has become easier to crack in recent years. The brainchild of two Belgian
computer scientists, the new technique, dubbed Rijndael, was chosen
following an intensive three-year search. Upon approval as a standard, the
algorithm may be utilized for sensitive, but not classified data, and will
be adopted by numerous government agencies.

   

Microsoft, Department of Justice Wrangle Over Appeal Details
The Department of Justice and Microsoft continued to disagree on important
details concerning the software giant's appeal of its guilty verdict in the
antitrust trial. The US Court of Appeals requested both sides to propose
schedules for the appeal. Microsoft's proposed schedule, submitted first,
gave both sides a total of five months to exchange filings, with initial
briefs about 56,000 words in length; the company's final reply would be
28,000. The DoJ wanted a faster schedule; matching word and deed, it
submitted its proposed schedule a day before its deadline. It calls for an
end to the written process by December 22, with oral arguments in early
January. It wants Microsoft to file a 24,000 word brief by November 1, to
which it would reply by December 8; the states involved in the case would
also file a 7000 word brief on the same day, if they chose. Microsoft's
final brief, due December 22, would weigh in at 7000 words. Microsoft is
expected to reply to the Justice Department's proposal by October 10.
Tellingly, by Microsoft's proposed schedule, the DoJ would not file until
February--and, as any US elementary school student knows, a new president
will be inaugurated in late January. It is widely assumed that a Republican
president would favor discontinuing the case against Microsoft. 

  

Net Law in China; What if They Held an Auction and Nobody Came?
The Internet has proven something of a sticky wicket for China, which is
attempting to find a way to leverage its possibilities without opening the
floodgates to "subversive" western content. China's cabinet passed sweeping
legislation that would compel Chinese companies to block all
government-banned content from their Web sites and chat rooms. New
regulations also restrict foreign investment and require Net content
providers and ISPs to keep logs of all content appearing on their Web
sites, as well as all users accessing their servers over a 60 day period,
for surrender to police upon demand. China also hosted an auction to enable
cash-strapped Internet companies to sell off shares to foreign speculators.
At the auction's conclusion, no bids had been raised for any of the 35
firms on the block, save legal services site www.elawchina.com, of which
stake worth US$1.9 million was purchased by another Chinese company. 

  

Netscape Revamps Image, Renews Google Deal
America Online subsidiary Netscape Communications unveiled the third and
final beta release of its updated browser. The new browser, which is
available for free download, is expected to be released in its final
version before year's end. In its aggressive push to keep pace with
Microsoft's Internet Explorer, Netscape is replacing the current 4.x
version of its browser with Netscape 6, skipping a version 5 release.
Available in English and Japanese version, Netscape 6 Preview Release 3
features better integration of AOL's AIM instant messaging application, as
well as enhanced support for XML and adopted HTML and style sheet
standards. Netscape has also extended its Google partnership to keep Google
as its default search engine. In addition, the company upgraded the look of
its Web site, changing its name from "Netcenter" to "Netscape.com" and
adding a Netscape Netbusiness area to target communication and data
services at the SOHO sector.  

  

More Products and Services Available for Netizens
Integration of function drives the latest products from both Vodaphone and
Palm. Vodaphone's Message-Cam includes a built-in digital camera and full
Internet access, allowing users to take pictures and immediately e-mail
them. The phone also features a voice recorder. Vodaphone will offer the
device in the UK. Shortly after unveiling an attachment which turns its
popular PDA into a cell phone, Palm demonstrated an attachment for Palm Vs
and m100s which turns them into MP3 players. The $179 device also serves as
a digital voice recorder and backup device. "Inclusion" might best describe
VeriSign's latest move. The owner of domain name registry Network Solutions
will begin testing registration of domains which use Korean, Japanese, and
Chinese characters. The test will begin next month, and all 65 domain name
registrars will be able to register domains with Asian characters. Other
non-Roman-lettered languages will follow. Exclusion--of viruses, that
is--serves as Symantec's goal; the company showed off a new technique aimed
at keeping out macroviruses, by far the most popular means of PC infection.
The technology blocks the use of commands commonly engaged by malicious
code, rather than scanning for and keeping out specific programs identified
as viruses. Some might accuse online auctioneer eBay of invasion after its
latest launch, but in a sense it is only returning home. Company founder
Pierre Omidyar was born in France, and eBay France is finally going live.
Users will be able to bid in francs for French-sourced collectibles, as
well as the millions of item on eBay's main site. So how does one say "I've
been sniped!" in French? For those who prefer to avoid being sniped by
buying items for a fixed price, there's Amazon.com. The online retailing
giant just added a camera store to its comprehensive offerings. The store
sells a full range of photography equipment, both traditional and digital,
as well as photo-editing software. Online photo albums are also available,
thanks to a deal with Ofoto. 

  

Internet Firms Foundering Financially
Web sites reporting on troubled dot com companies enjoyed a field day this
week. Online drug store More.com employs less staff now, after cutting more
than 30 percent of its work force. The company dropped 20 percent of its
work force in June. Lou Dobb's Space.com said it will lay off 22 workers,
about 20 percent of its staff. The news came within a week of the space
news agency's president, astronaut Sally Ride, turning in her resignation
after 15 months in the position. The Priceline WebHouse Club reported it
will close its doors entirely in the next three months. The privately held
licensee of Priceline offered name-your-own-price services for gasoline and
groceries. It is the second piece of bad news for the firm; the first came
when Connecticut Attorney General Richard Blumenthal revealed that he is
investigating consumer complaints against Priceline concerning gasoline and
airline tickets purchased through the Web site. Kibu.com, a teen-targeted
Web site supported by Jim Clark and other Silicon Valley go-getters, is
also shutting down, and has laid off most of its 65-person staff. Uniquely
among the dot com closings, Kibu's entire team put up its resumes on one
Web site, Kibupeople. Garden.com started withering; it laid off close to 40
percent of its work force and hired investment bank Robertson Stephens to
help with fundraising efforts. Finally, shortly after cutting its work
force by about 30 percent, Freeinternet.com canceled its proposed initial
public offering of stock.  

  

E-Tailer Web Sites Close to Get Ready for Holiday Shopping Season
It is practically unheard of for an online retailer to deliberately close
its Web site for anything short of bankruptcy (with notable exceptions,
such as eBay's weekly maintenance). In advance of the holiday shopping
season, however, several Web sites are closing their virtual doors to get
prepared for the rush. Wal-Mart stated it will shut down its Web site until
early November to install software and make upgrades. Kmart's Bluelight
reportedly also plans to spend some time on a makeover, turning its face
away from the Internet in the meantime. Estee Lauder's gloss.com is taking
more extreme action--it won't be open at all during the shopping spree
season. It is a calculated risk to close a retail Web site during this time
of year--one that must be balanced against the risks of not being fully
prepared to meet the onslaught of online gift shoppers expected. When
Toysrus.com failed to perform last year, for instance, and delivered
presents late, it was forced to apologize to disappointed shoppers and
issued $100 gift certificates. No e-tailer wants to become the next holiday
victim. 

  

Outage Ticker: Sprint, Qwest, UUNET
Sprint will be busy with network enhancement on both coasts on Monday,
October 9. On the East Coast, for six hours between midnight and 7:00 AM
EDT, a large number of routers in Pennsauken, NJ will be affected; anyone
directly connected to those routers at that time may temporarily lose
connectivity or suffer a degradation of service. The Pennsauken routers
which will be affected include sl-gw11, sl-gw12, sl-gw14, sl-gw15, sl-gw17,
sl-gw28, sl-gw30, sl-gw31, sl-gw7, sl-gw8, sl-gw9, sl-gw33, sl-gw35,
sl-gw36. On the West Coast, one router in Stockton, CA will be affected for
one hour during the same maintenance window: sl-gw24. Of course, not all of
the company's outages are planned in advance: last night (October 5) at
10:15 in Fort Worth, Sprint's sl-gw27 router experienced an outage, which
it repaired by upgrading some code and reloading the router. On Monday,
October 2, Qwest was rumored to be having hardware problems with its router
at JFK airport. Finally, thanks to a power outage in the Toronto area, five
of UUNET's OC-48s went dark on Tuesday. The problem was resolved by
Wednesday morning. At least we can be glad that the backhoes have begun
their winter hibernation. 

  

Cyberscape Delight: Even Virtual Universities Deserve Football Teams
Students at Kentucky Virtual University don't go to lecture halls, don't
live in dorms, and don't eat cafeteria food--but they do have a team to
root for. The KVU @vengers is one of several teams in a virtual fantasy
football league that includes virtual learning institutions in Michigan,
New Hampshire, Old Dominion, Texas, and Magellan. Sporting names like
MegaRams (Michigan) and MegaHertz (Texas), the teams play each other every
Saturday in computer simulations, with game reports compiled and sent to
students. To round out the league, six other schools with teams were
created (virtual virtual teams?), including Animal House's Faber College
Otters. Tom Krattenmaker, the public relations director at Swarthmore
College, runs the fantasy league. A visitor to the league's Web site will
find team standings and statistics, a schedule, reports on the games played
so far, and even "The Bug," a page of sports writer style commentary on the
games and the teams. Interest is high among the students at all the
colleges; many students  have lent their names or nicknames to players on
their college's team. At least one college is considering a virtual
basketball team.


*** Terri Wells, Faulkner Information Services *** 

  

CyberScape Digest, Copyright 2000, Faulkner Information Services. All
rights reserved. 

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