🚀 go-pugleaf

---------- Forwarded Message ----------
Date: Friday, June 16, 2000, 2:15 PM -0400
From: Faulkner Information Services <mailserver@faulknerinfo.com>
To: ???
Subject: Faulkner's Cyberscape Digest 06/16/00




If you are unable to read this document go to:

http://www.faulkner.com/products/faccts/00023184.htm


CyberScape Digest

CyberScape Digest is a weekly roundup of top internet stories. This issue
covers events from Monday 06/12/00 through Friday 06/16/00. 


  
Digital Signatures, Anti-Spam Measures Get Their Day in Congress
While various companies bustled about doing things to change the way we
deal with our day-to-day lives, Congress looks well on its way to enacting
legislation that will change the way we deal with those companies. The US
House of Representatives gave a stamp of near-unanimous approval to a bill
that grants electronic signatures and documents the same force of law as
their more traditional paper counterparts. Digital signatures will be
permitted on checks, to complete loan applications, and contract services.
The bill protects consumers with an "opt-in" policy; they will still be
able to use handwritten signatures when they prefer. Cancellation of
utilities, court orders, eviction notices, and certain other documents will
still need to arrive on paper rather than electronic documents to be
legally binding. The bill now goes to the Senate for a vote; President
Clinton is expected to sign it into law when it reaches him. If made law,
it would take effect October 1 of this year. Another bill, not quite so far
along, deals with the ubiquitous unsolicited commercial bulk e-mail. This
bill, approved by the House Commerce Committee, would make it a crime to
send spam after a consumer requests removal from a list, and sets a penalty
for violating the law. It also obligates spammers to label their spam and
include a return address. The proposed legislation goes next to the full
House for a vote..


AOL Deals with Rival, Gets Dealt with, Makes Deals
Add another name to the instant messaging rivalry between America Online
and the rest of the world. Odigo released its Odigo Messenger 2.5 product
on May 31, offering interoperability with both AOL's Instant Messenger and
ICQ. The Internet giant didn't begin blocking Odigo's users from connecting
with AIM users until this week, however--not too surprising given Odigo's
size. Odigo users can still connect with ICQ, though. Odigo responded by
trying to contact AOL directly, saying that it didn't want an escalating
war of the sort AOL fought with Microsoft and others not too long ago. It
also issued a patch that restored interconnectivity with AIM, in seeming
contradiction to its earlier statement. On the other hand, the move may
have achieved a different purpose. Barry Schuler, president of America
Online Interactive Services, stated that his company will soon present a
proposal for interoperability among its own and other companies' instant
messaging services--which the company actually did do late Thursday. AOL
may be tired of fighting against the inevitable--or it may be mildly
spooked by requests from federal regulators asking for "clarification" of
the company's intentions in the areas of high-speed Internet access, local
telephony, and oh yes, instant messaging, once AOL completes its merger
with Time Warner. Schuler stated that the IM matter as related to the
merger was a non-issue, but it does make one pause for thought, considering
that all this is happening around the same time. Be that as it may, the
regulator's questions didn't prevent AOL from pursuing an enormous batch of
deals this week. On the topic of instant messaging, Satyam Infoway agreed
with AOL to distribute a co-branded version of AIM to its SatyamOnline
customers and through its consumer portal. Speaking of consumers, AOL's
deal with Target will help the ISP reach a lot of them (as if it needed any
help with that). The cross-marketing alliance combines offline co-branding
promotions and in-store offerings with online initiatives pushing both
brands. Target's online store will become a premier retailer across several
AOL brands, while AOL will become Target's preferred online service. Sprint
agreed to begin offering AOL Mobile services on its Sprint PCS
Internet-ready wireless phones. Users will be able to access e-mail, news,
weather, stock quotes, and AOL content from such sites as Digital City and
MovieFone. Speaking of deals with mobile phone companies, Carphone
Warehouse, a large European mobile phone retailer, agreed to team up with
AOL on a service offering, called Mviva, which should make it easier for
European cell phone users to reach the Internet. The Mviva number, preset
in Internet-ready phones at Carphone's stores, will allow users to access a
range of Internet services; at least 50 companies made agreements with
Mviva to be included in the offering. AOL is taking a 15 percent stake in
Mviva; in return, the ISP will promote and provide services for it, and pay
$25 million in cash. Adding to this international expansion, AOL also made
an agreement with Gric Communications to use its International Internet
roaming service so that AOL subscribers will be able to access their
accounts in 10 more countries. Let's see, that covers instant messaging,
mobile phones twice over, general expansion...what next? How about
interactive TV? AOL made a three-year strategic agreement with TiVo to
build a dual-purpose AOLTV-branded set-top box. AOL will put up a $200
million investment in TiVo to seal the deal. 

  
ICANN Sets Timetable For New Domains
Cyberspace stands poised to get a lot more space as ICANN displayed a
recommended timeline for adding new Internet domains to the root server. If
the timeline is approved at the next ICANN board of directors' meeting, new
registries could be up and running by the end of the year. ICANN will need
to deal with a raft of issues before introducing the new generic top-level
domains, such as how to contain the inevitable rush to register the
newly-available names. At present, ICANN is accepting "expressions of
interest" from those wishing to run a registry for the new domains; the
non-profit organization will begin its official search for new registries
in August, and will accept comments on what the new domains should be
(.xxx, .sucks, and .sex have already been suggested) until October 8. 

  
Microsoft Wrestles With Justice Department, Takes Care of Business
With Microsoft and the Justice Department squaring off against each other,
who needs soap operas? Seriously, if one figured that Microsoft would
simply move towards a swift appeal once US District Judge Thomas Penfield
Jackson decided what penalty to apply to the software giant, one would have
been mistaken. First, Microsoft made a pro forma two paragraph request to
Judge Jackson that he stay the business restrictions on the company, which
are scheduled to go into effect on 90 days. No one thought that the judge
would actually grant a stay--except maybe the Justice Department, which
fired back with a 17 page brief giving all the reasons why the judge should
not grant the stay, and even asked that Jackson hold back on ruling on the
request until Microsoft files its appeal. Either the DoJ was rehearsing for
that appeal, or it was getting frustrated with Microsoft for not filing it
yet. The DoJ can request that Microsoft's appeal immediately be heard by
the Supreme Court--but not until Microsoft files that appeal, and the
software giant has 60 days to do so. Microsoft did file an official notice
that it will appeal--and the US Circuit Court of Appeals for the District
of Columbia promptly indicated that it would be delighted to expedite a
hearing of Microsoft's appeal, and that all of its judges would sit to hear
the case because of its "exceptional importance." That same day (Tuesday),
the DoJ requested that Judge Jackson send the case to the Supreme Court,
and Microsoft filed a 39 page motion asking the appeals court to stay the
entire final judgment, including the breakup order. On Wednesday, Microsoft
said that it would formally file objections early next week to the DoJ's
attempt to fast track the appeal to the Supreme Court. The DoJ, meanwhile,
filed an objection to Microsoft's request to the appeals court to stay the
entire breakup order, and asked the appeals court to dismiss the stay
application or at least defer until Judge Jackson decides who will hear the
appeal. Why Microsoft and the DoJ are playing this game of where the appeal
will be heard becomes clear when one remembers that the DC Court of Appeals
has ruled in favor of Microsoft in the past on similar matters. Both
Microsoft and the Justice Department believe the software giant will
receive a favorable ruling again from the appeals court--hence Microsoft's
attempt to get heard there, and the DoJ's attempt to go directly to the
Supreme Court with the case. Stay tuned. Meanwhile, Microsoft tended to
other business this week as well. It agreed to work with DirecTV and
Thomson Multimedia on a product dubbed "Ultimate TV." Available this fall,
the bundle includes a DirecTV receiver with a digital video recorder and
Internet access through the TV. Microsoft is also working with Samsung to
design, develop, and market a range of mobile phones for both GSM and CDMA
networks using Microsoft's Mobile Explorer wireless communication platform.
And oh yes, the company's online car-buying division purchased DriveOff.com
from Navidec. DriveOff will provide CarPoint with services that will make
it easier to handle a car purchase transaction almost entirely online; the
user will only need to show up at a dealer to sign papers (which have
already been express-shipped to the user) and drive off with the car. Even
with the antitrust case, Microsoft is looking toward the future. Bill
Gates, speaking at the 2000 World Congress of Information Technology,
revealed that the software giant is investing heavily in the development of
Next Generation Windows Services, a technology to update applications,
synchronize data bases, and manage information from Web sites. Let's hope
it's not trying for another monopoly. 

  
Large Internet Hazards Hidden in Outdated Software
Security company DeMorgan sounded a warning about the outdated software
being used on 30 percent of the computers controlling the ".com" domain
name system. Because of this software, these computers are vulnerable to
denial-of-service attacks, similar to the sort which shut down several
major Web sites earlier this year. These vulnerable computers include some
of the highest-level root servers, according to DeMorgan--a statement
denied by an ICANN spokesperson. Root servers accept requests from one
domain and show how to reach addresses in another domain; if such servers
go offline, Web surfers would not be able to reach Web sites with the
domain controlled by the computer. The .com domain remains the most popular
one on the Internet. 


It's a Buyers' Market
The depressed values of some dot-com companies encouraged some other
dot-com companies to put in their bids for buying rivals. And who would
know more about bidding than eBay? The online auction giant put up stock
valued between $312 and $374 million for Internet bazaar Half.com. Half.com
made a splash in the news when the start-up company convinced Halfway,
Oregon, to change its name to Half.com for a year. Unlike eBay, it lets
users buy used goods for a fixed price, usually one-half or less of the
item's retail price. In another birds-of-a-similar-feather deal, online
advertising company Engage agreed to purchase marketing firm MediaBridge
for stock valued at $268 million. The deal lets Engage expand its marketing
services and strategies to traditional companies. NetScout agreed to
purchase NextPoint for $60 million in cash and stock, expanding its line of
network performance monitoring products in the process. eToys is also set
on expansion; it bought certain assets of eParties for stock valued at $1.6
million. The toy seller gains the eParties name and certain proprietary
technology from the deal, which it will use to set up a party planning
center on its Web site. Monster made a bid to help the HR professionals who
use its Web site by purchasing Simpatix, a software company whose
technology automatically ranks candidates' resumes based on criteria
defined by the user. The biggest news, however, concerns media and
communications company Vivendi, its Canal Plus pay-TV unit, and Seagram.
The three firms are planning a $30 billion three-way merger. If and when
the deal is completed, the merged company will have a market capitalization
of more than $100 billion and annual revenues of $65 billion. Look out,
AOL-Time Warner!  


Lawsuits and Crackdowns and Probes, Oh My!
Those focused too closely on high-profile lawsuits like the Microsoft
antitrust trial might miss a few other matters going on--which would be a
shame, because we're still in the anything-can-set-a-precedent days of
cyberspace. Adobe is suing Macintosh News Network for misappropriation of
trade secrets. According to the graphics company, MacNN got its hands on an
unauthorized copy of the feature guide for Photoshop 6 and ImageReady 3 and
ran a four-part news story about both products on the AppleInsider Web
site. Adobe pointed out that both products are in such an early stage of
development that any information about them should be considered trade
secrets. Additionally, many parts of the story that the AppleInsider site
ran seemed to be lifted verbatim from the feature guide. Adobe wants
injunctions against MacNN preventing the company and its employees from
engaging in this type of behavior again, plus copies of all "proprietary
and confidential" information in MacNN's possession, plus payment for the
damages it believes it suffers, which it estimates in the range of eight
figures. A glance at the AppleInsider Web site Friday morning revealed that
links to the stories in question had been "removed by the demand of Adobe
Legal." Adobe would have done the same thing if MacNN was a paper
publication, no doubt, making the Internet simply a new way to
(potentially) commit an old crime. Of course, the Mob could tell anyone all
about that--according to federal authorities, anyway. A securities fraud
crackdown being heralded as the largest in US history nabbed 120 people
accused of defrauding investors out of at least $50 million, and using the
Internet to do so. The authorities' net caught supposed members of five
different New York mob families; stockbrokers and fund managers; a former
police detective; and a grab bag of corporate insiders. The charges, filed
in Manhattan, include 16 indictments and seven criminal complaints. In a
matter somewhat more directly related to the Internet, the Philippine
National Bureau of Investigation's probe into who perpetrated the Love Bug
virus will yield charges next week against Onel de Guzman. The college
student was an early suspect in the case. At the beginning of the
investigation, the Philippines had no law against computer crime, but the
president of the island nation, Joseph Estrada, signed an anti-hacking law
just this week. Meanwhile, Michigan's proactive Attorney General Jennifer
Granholm threatened four Web sites with lawsuits because they failed to
inform consumers whether their privacy rights are being protected. The
controversy centers around the use of cookies to track Web surfers'
movements, and the attorney general's complaints range from inadequate
disclosure of what is done with the data to failing to reveal that the Web
site uses cookies from third parties in addition to its own cookies. The
four sites in question, Johnson &Johnson's procrit.com, AmericasBaby.com,
Stockpoint, and the Intimate Friends Network, are all cooperating with the
attorney general. 


Music Lawsuits: One Settles, One Prepares to Fight
MP3.com and Napster, both under siege from the Recording Industry
Association of America for copyright infringement, are taking different
approaches towards their accusers. MP3.com agreed to settle with at least
two of the plaintiffs against it, BMG Entertainment and Warner Music
Group,. paying an undisclosed sum. The company will also pay each time a
BMG or Warner song is moved into a user's MyMP3.com account, and another
amount when a user plays the song. The fees may force MP3.com to start
charging users for its service. Napster, meanwhile, showed its feisty side,
with CEO Hank Barry's response to the RIAA's court motion for a preliminary
injunction against the company. According to Barry, the whole lawsuit
revolves around the legality of sharing MP3 versions of sound recordings
over the Internet--and Barry maintains the practice is legal. Additionally,
Barry pointed out that the company cannot control the files which are
stored on the many thousands of individual PCs which swap files using
Napster's software. He also addressed a number of the issues raised by
RIAA's filing, including the supposed decline in record sales around
college campuses where students can access Napster. Planning for its
future, the online music company said two days later that it will create
relationships with unsigned artists and independent labels to make their
music available through its software. Its first agreement is with rap label
75 Ark Entertainment. It is not backing away from its main business as a
file-sharing company, however. In fact, it reportedly hired David Boies,
the attorney who presented a stellar case against Microsoft during its
antitrust trial, to defend it from the RIAA. It will be interesting to see
how these two different approaches work out in the long run. 


Hollywood, Grocery Companies Discover B2B
A number of Hollywood investors, spearheaded by movie producer Robert
Fried, got together to launch an online B2B exchange for the sports and
entertainment industry. Dubbed the WHN Exchange, it will bring together
those who hold the rights to licensed products with manufacturers and
retailers. The investors hope the exchange will help bring products to
market faster. The venture will earn its keep by taking a small fee from
user transactions, rather like the model that works so well for eBay.
Coca-Cola, Kraft Foods, and 47 other large food and beverage companies
climbed aboard the B2B bandwagon with Transora.com, a B2B marketplace
expected to start handling transactions by the end of the year. In addition
to procurement, the exchange will include vendor and product catalogs,
online order management, supply-chain collaboration, and financial
services. 

  
Doing the Deals
BroadJump and Portal Software agreed to work together to link their
client-server software and billing software. The resulting product will
allow a cable company or DSL provider to sell and bill for pay-per-use
events enabled by broadband access, such as videoconferencing. Speaking of
DSL deals, RMI.NET and Zyan Communications partnered to provide nationwide
DSL services. The deal is expected to save RMI more than $2 million on its
DSL rollout. Broadband gets used for many things, but one of the more
exciting uses is distance learning--which brings us to the deal between
Telefonica, IBM, and Cisco. The three companies agreed to create an online
business school for speakers of Spanish and Portuguese. The "e-ducavia"
venture will use multi-media Internet services, mobile telephony, and
interactive television. Pumping more than US$95 million into the project,
the three partners hope to start offering courses at the beginning of next
year. The courses, which will go up to the Masters level, will cover
management, marketing, communications, advertising, and similar topics.
Speaking of marketing, Hewlett-Packard and Softbank agreed to form a joint
venture to market HP PCs and printers to Japanese customers via the
Internet. The two companies are also investigating other possible joint
ventures, including online financial services. eBay was hot for deals this
week; it completed the first step in its four-year marketing agreement with
Go.com by launching a co-branded site to showcase items from Walt Disney,
and it teamed with Saturn to sell used cars. Saturn will inspect the cars,
which will not be limited to Saturn or GM models, and then the cars will be
sold on eBay and on the co-branded eBay-AutoTrader.com site. Speaking of
co-branding, Lycos and OnlineChoice agreed to go live with a co-branded Web
site. OnlineChoice creates pools of consumers nationwide and leverages
their buying power to drive down the price of the commodities they buy,
using a supplier-driven reverse auction. Users of the co-branded site will
be able to purchase electricity, natural gas, gasoline, and other services.
Finally, for those who need help building an online store and want to work
with a familiar name, Federal Express is teaming up with Orbit Commerce to
host applications and services to set up e-commerce sites fast. Fedex will
integrate the Web stores with its shipping and tracking systems. The
arrangement pits Fedex against Amazon's zShops, among other contenders in
the field. 

  
EU Moves Forward With Online Copyright Protection
Copyright protection on the Internet remains one of the more controversial
issues that governments grapple with. This week, the European Union began
to tackle the matter head-on with an approval by its board of national
ambassadors of legislation designed to protect copyrights on the Internet.
The legislation is similar to the US Congress' 1998 Digital Millennium
Copyright Act, in that both provide express copyright protections to works
posted on the Internet. However, the legislation does not deal with
liability for copyright violations; that will be addressed separately. The
measure now goes to the European Parliament. If it is approved there, it
will be implemented as a directive to EU member states, who would then have
a certain period of time to adopt the new rules. 

  
It's 10 PM. Do You Know Where Your Personal Data Goes?
Computer security and privacy consultant Richard Smith made an alarming
presentation before the Senate Commerce Committee. Using tracking software
to follow where his personal information went as he was researching
diabetes, he discovered--and demonstrated before the committee--that many
Web sites send sensitive information to ad companies without the Web
surfer's knowledge. Information forwarded in this fashion included Social
Security numbers, which Web sites are visited, which disease was being
researched, and which pages were visited. Which advertiser is receiving
most of this information? DoubleClick, a company under investigation for
privacy violations. A DoubleClick spokesperson insists that the data is not
being used to target consumers, and that it isn't saved or kept in any way.
Sites passing on information included DrKoop.com, which passed on Smith's
e-mail address and that he sought information on diabetes; Travelocity,
which passed on Smith's daughter's flight information; and AltaVista and
RealNetworks. Particularly ominous is that, according to Smith, many Web
sites don't even know they're forwarding the data. The senators at the
hearing agreed that legislation is needed to protect users from unwittingly
disclosing their personal information to third parties. 

  
And Now For the Agony Report...
It's time to see who's going bankrupt, who's had layoffs, and who's picking
at the scraps. In the bankruptcy department, film site Reel.com said it
will no longer sell videocassettes and DVDs. The company will not close
altogether; it will still offer movie news, reviews, and other content on
its Web site. Reel.com's parent, Hollywood Entertainment, explained that
the e-commerce portion of the site had become too expensive to support.
Online music retailer Emusic.com laid off about 40 workers, or 20 percent
of its work force, saying that the move will help save $15 million over the
next year. In the vultures department, Pets.com agreed to purchase the
assets of Petstore.com for more than $10 million in stock. Pets.com gets
Petstore's customer data base, live fish shipping business, $3 million in
funding, and relationships with Discovery.com and Safeway. Discovery's
parent and the grocery chain will now take stakes in Pets.com and promote
the e-tailer to their customers. Petstore's employees will be laid off,
however, and its warehouse in San Leandro will be closed. Finally, in the
"you mean they're still around?" department, Iridium has been rescued--but
it might only be to pay off its debts. Chase Manhattan Bank is suing the 17
members of the original Iridium consortium for $242.7 million in defaulted
debt. Chase claims that, since the company was a consortium, its members
are still responsible for the loan payments, despite the bankruptcy. The
suit isn't expected to harm US merchant bank Casle Harlan's $50 million bid
for Iridium's assets, but it doesn't help Iridium itself at all. 

  
Outage Ticker: Detroit, JP Morgan, Hotmail
A grab bag of outages occurred this week. A power failure took out the city
of Detroit, Wayne State University, Redford, and Livonia at 12:45 PM
Tuesday. Detroit's airport, fortunately, had emergency power for its
operations; Detroit Public Lighting's computer center lost power along with
everyone else, however. No information was available as to how extensive
the outage was or estimated time to repairs. JP Morgan's Web site was also
down Tuesday because it neglected to pay its domain name bill to Network
Solutions in time. The company made its payment the following day, without
comment, and its Web site returned to life soon after. Alert Internet
watchers will note that the same thing happened to Microsoft's Hotmail
service in December of last year. Speaking of Hotmail, some users of the
free e-mail service in the US and Canada were locked out of their accounts
for more than a week, reportedly because of a problem with one of the
service's servers. Their service was finally restored Wednesday to most of
those users by Wednesday--minus their personal folders, address book
entries, and saved e-mail. Some users are still locked out as of this
writing; Microsoft is working to fix the problem.  

  
Cyberscape Delight: Of Royalty, Righteousness, and Rigor Mortis
Yes, Father's Day is this Sunday, so in acknowledgment of this fact we've
(mostly) focused our delight on items with family values. To start with,
there's the Royal Family--the UK Royal Family, for you sticklers out there.
Web site City2000 invited the whole world to visit its Web site and send
birthday greetings to Prince William, grandson of the reigning monarch and
eldest son of Prince Charles and the late Princess Diana. The lad turns 18
on June 21. City2000 plans to burn a selection of the greetings onto a
CD-Rom and present it to a palace secretary to pass on to the young
blueblood. The goal is to beat the 270,000 good wishes it gathered last
year for the wedding of Prince Edward to Sophie Rhys-Jones. (Prince Edward
is Charles' brother and William's uncle, for those keeping track). Families
have children, and here's an item to help give them the savvy needed to
stay out of trouble online. Canadian company LiveWires Design came out with
a computer game called "Missing" that teaches kids about the hazards of
sexual predators online. Players are asked to help find 13-year-old Zack,
who has been kidnapped by an adult he met over the Internet. The game
mimics an actual investigation, and because it's a computer game, the
warning has a better chance of sinking in than lectures. Finally, a Web
site that is not quite so socially redeeming--but might be fun for Dad.
Billing itself as "the dot-com deadpool," F**ked Company (we did warn you)
follows bad news of companies, especially Internet companies. It is also a
game, based on the classic "deadpool," where players pick celebrity deaths,
with points earned on odds. In this case, however, players bet on
companies. Points are awarded based on news ranging from general minor
items to firings to "all-out corporate slayings" with each news item given
a severity rating from 1 to 100. The site's rules explain the scoring
system; each player is allowed to pick up to five companies per week.
Players earn points and pride only; while they must register to play,
registration is free, and the owner of the site states bluntly, "I don't
make--and don't plan to make--any money from it." Particularly for the risk
averse, this could be more fun that trading on the stock market.


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

  

  


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


Should you have any questions, concerns or problems with your flash, please
contact us at: mailto:flash@faulkner.com 

---------- End Forwarded Message ----------