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Date: Friday, October 20, 2000, 3:26 PM -0400
From: Faulkner Information Services <mailserver@faulknerinfo.com>
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Subject: Faulkner's Cyberscape Digest 10/20/00


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CyberScape Digest

CyberScape Digest is a weekly roundup of top internet stories.  This issue
covers events from Monday 10/16/00 through Friday 10/20/00. 

America Online, Time Warner Make Deals Worth Watching
AOL is still everywhere--now even more than ever. Thanks to a deal with
Sprint, the ISP's Instant Messenger service will be available for free on
Internet-ready Sprint PCS phones. AOL's merger partner is no less busy.
Time Warner signed a deal with RMI.NET to allow the ISP to provide
high-speed Internet access over Time Warner's cable system. RMI.NET is only
the second company Time Warner has opened its fat pipes to; Juno was the
first. The latter deal touches on one of the issues that have held up the
AOL-TW merger--namely, whether the combined company will grant access to
its cable lines to competing ISPs. 

Of Cybercrime and Carnivore, of COPA and of...
The Council of Europe's draft text for an international convention on
cybercrime came under attack from organizations in several countries. The
organizations fear that the agreement will pose a threat to individual
liberties. According to the president of the Electronic Privacy Information
Center, the convention seems to encourage governments to view all Internet
users as potential criminals. EPIC and other free speech organizations
posted a letter of protest on the Internet which fully details their
objections to the convention. These include requiring ISPs to retain
records of the activities of their customers; too vague a definition of
"illegal devices;" and a "dramatic extension of copyright crimes." Problems
with cybercrime and cyber-law enforcement seem to naturally bring up
Carnivore--at least if one lives in the US and keeps an eye on the FBI.
House Majority Leader Dick Armey (R-TX) sent Attorney General Janet Reno a
letter in which he criticized the nature of the review being conducted on
the controversial e-mail surveillance device. According to Armey, several
recently released documents indicate that Carnivore belongs to a family of
spying devices collectively known as "DragonWare." Armey wants all
DragonWare devices to receive scrutiny. Furthermore, he is unconvinced that
the review will be as "independent" as necessary for such a delicate
matter, since some of the reviewers possess strong ties to the government.
Of more concern, according to documents obtained by EPIC through the
Freedom of Information Act, is that the FBI is creating two new, enhanced
version of Carnivore. These later versions will be able to intercept voice
over IP communications. While the common citizen wants to prevent the FBI
from spying on him or her, the common parent wants to prevent Junior from
espying Web sites he or she should not be looking at. Thus the report from
the commission established under the Child Online Protection Act may be of
interest. Just released, the report states that the best ways of protecting
children from harmful content online include more public education,
enforcement of existing laws, and greater use of existing technologies. The
report emphasized voluntary methods, and refused to support a law requiring
Internet filters at libraries and schools receiving public funding. 

There'll Be Some Changes Made...
A number of companies are sprucing up, relaunching, rethinking, and in
general making changes. Aimster, the file-swapping service that piggybacks
on AOL's Instant Messenger, plans to expand its service to users of MSN's
and Yahoo's instant messaging services. The move could link more than 140
million instant messaging users on four different IM networks (two run by
AOL, AIM and ICQ). Walt Disney Internet Group relaunched its Go.com search
service. Formerly serving as a general interest engine, Go.com will now
focus on providing information on leisure and lifestyle topics. Popular
search engine Google also debuted some changes. It now features a paid link
program. Such links appear above normal search results, with a different
colored background, and are clearly marked. The company also made it easier
to find stock quotes; a search on the name of a publicly traded company
will return a link to its stock quotes. Google also added 10 new search
languages, including Greek, Hebrew, Polish, and Romanian, bringing the
total of languages it supports to 25. Finally, online auction site eBay is
considering some changes--not so much to the site itself, but to the type
of medium it can be viewed on. It will still be the same eBay on the
Internet, but it is in talks with several broadcast and cable networks
about the possibility of an eBay TV show. The company is pitching it for
daytime TV, Monday through Friday, and plans to feature items for sale on
the Web site and profiles of eBay users. 

Shaking Hands, Making Deals
A number of general Internet hosting and B2B deals happened this week.
First, Verizon inked a three-year partnership with Interland to sell Web
hosting and other services to small- to mid-sized businesses. The companies
will each put down $6 million towards marketing the service. Second,
speaking of small business, NBC Internet's AllBusiness unit will merge with
Bigvine to create a B2B company focused on the small business Internet
market. The new company, operating under the AllBusiness name, will combine
AllBusiness' content with Bigvine's barter transaction engine. Speaking of
mergers,  Nortel Networks and ANTEC agreed to combine their high-speed
cable companies into one firm. The new company will be named Arris, partly
because it will acquire Nortel's majority ownership interest in Arris
Interactive, an earlier joint venture between Nortel and ANTEC. Once all
the dust has settled, Nortel will own 46.5 percent of Arris, and ANTEC will
become an Arris subsidiary. Finally, specialty metals trading marketplace
MetalSpectrum got all excited over completing its first Web transaction, a
trade for 10,000 pounds of aluminum rod. The transaction occurred one day
after the online B2B market opened for e-commerce.     

The US Government and the Internet
President Clinton helped to ease the tech worker shortage by signing a bill
to raise the cap on the H-1B visa program from 115,00 to 195,000 workers
through fiscal year 2003. Immigrants brought in with H-1B visas are usually
temporary workers with software- and Web-related skills. Meanwhile,
Minnesota set out to help redeem the president's promise of online
government by creating an electronic payment engine that will allow
citizens to make secure online payments to the state's 34 governmental
agencies. To the delight of state motorists, the first agency open to
online payments will be the state's department of motor vehicles. The
service is the result of a collaboration between the state's Office of
Technology and EzGov, a private company. Finally, a bill with bipartisan
sponsorship was introduced in Congress. The "Internet Prescription Drug
Consumer Protection Act of 2000" would make it illegal to sell drugs to
Americans over the Internet unless the seller reveals his exact address,
phone number, and states in which he is licensed to sell drugs. The bill
would also allow state attorneys general to obtain nationwide injunctions
against anyone selling prescription medicines illegally online. 

Internet Firms Start Holiday Shopping Early
It isn't after Thanksgiving yet, but some companies have already begun
shopping for the holidays. EDGAR Online effectively bought Internet
Financial Networks' IFN EDGAR news service. The two companies agreed to
transition customers of IFN's service to EDGAR Online's service. Both
services provide information derived from the Securities and Exchange
Commission. Meanwhile, in a purchase already in progress, Terra Networks
spelled out that it will swap a little more than two shares of its stock
for every share of Lycos stock to complete the deal. Lycos shareholders
will vote on the deal on October 27. Finally, looking towards a future that
is up in the air, QUALCOMM purchased a stake in SkyBridge, builder of a
global satellite telecommunications network. Neither the size nor the price
of the stake were disclosed. 

Oh, That "Wonderful" Feeling of Exposure...
Just how many different meanings can the word "exposure" carry? Try one for
every company experiencing it. Aside from Adobe (see Outage Ticker below),
a number of Internet firms found themselves diving for cover. A combination
of a security flaw in an open-source e-commerce package from Extropia with
a misconfigured server from Mindspring exposed encrypted passwords for up
to 81,000 domains hosted by EarthLink. For at least a week, users could
copy scrambled keys to those accounts, decrypt the passwords, and read them
from any Web browser. Extropia fixed the flaw in its software; EarthLink is
investigating the matter. Meanwhile, auction giant eBay found itself
exposed to what it would probably term unfair competition. Auction utility
site Auctiva set up a service dubbed "Showcase" which permits auction
runners to put all their auctions in one place. Viewers of one of the
seller's auctions can then click on a link and view all of the seller's
auctions on an Auctiva-hosted page. According to eBay, users of this
service violated eBay's rules--and it canceled about 100 auctions using
Showcase. The two companies are in talks to iron things out. Bankrupt
online furniture company Living.com will shortly be exposed to liquidation,
thanks to Maynards Industries' $4.5 million winning bid for its physical
assets. The Canada-based liquidator will sell the furniture to the public
at Shaw Furniture in North Carolina. Speaking of sales that may leave one
feeling exposed, pity Xerox. According to some reports, the former
blue-chip company now must make some hard decisions to avoid
bankruptcy--including the possibility of selling all or part of its famous
Palo Alto Research Center. PARC is known for several inventions important
to the Information Age, including the computer mouse.   

And Now for the Microsoft Report...
The case against Microsoft proceeds slowly but surely. The US Court of
Appeals, which will be the next court to hear the case, wants Michael H.
Hites to conduct a briefing on November 14. Hites, the chief technology
officer of the Illinois Institute of Technology in Chicago, would give a
descriptive review, focusing on the concepts behind the technology in
question. With so many matters in question, one can't blame the court too
much for wanting to brush up on the basics. The US government isn't the
only agency challenging the software giant. The European Commission charged
Microsoft with abusing its power to gain an edge in the server software
market, but gave the company extra time to answer the charge. Microsoft had
asked for, and received, an extension; its new deadline is mid-November.
Meanwhile, the software giant has other matters to worry about. It
discovered a flaw in its Internet Information Server 4.0 and 5.0 Web server
software, which allows a user with a special URL to access any files on a
Web server. The company released a bulletin to its customers and urged them
to patch their systems. The IIS software runs on more than four million Web
sites. But all of this didn't distract Microsoft from business. It signed a
deal with OmniSky to extend wireless Internet and e-mail services to the
Microsoft Windows Powered PocketPC platform. The agreement allows PocketPC
customers with a wireless modem and an OmniSky subscription to use
real-time access to e-mail, the Internet, and to manage their POP3
mailboxes for just under $40 per month. 

Time to Trot out Products, Services for the Holidays
Some lucky people with wired homes may receive an Audrey for the winter
holidays. Made by 3Com, the $499 Internet appliance specifically targets
the connected household. The device is essentially a Web tablet with an
eight inch touch screen. It features Palm's HotSync technology, allowing
two Palm users, for instance, to synchronize schedules from their PDAs into
a master calendar. Perhaps most interesting is a knob that lets users
switch between preprogrammed Web sites in the same way that TV viewers
changed channels before the days of the remote control. Businesses with Web
sites can also participate in the holiday cheer, thanks to Akamai. The Web
caching company created an Internet content service, dubbed EdgeSuite,
which allows Web sites to quickly deliver dynamic content to users. It
improves on Akamai's FreeFlow service by caching more of the content at the
edge of Akamai's network, closer to users. A Web site owner could use
Akamai's service to, for example, display a static banner ad and include
frequently-changing information within it, such as sports scores. (Your
humble reporter is certain some e-tailer will use the service to count down
the number of shopping minutes left until Christmas). For
do-it-yourselfers, Excite@Home offers a self-installation kit for Internet
over cable. The new kit contains step-by-step instructions which, if
followed correctly, will remove the need for its customers to see a cable
installer. The company hopes this will improve the customer experience by
eliminating problems with missed appointments and sloppy installations. For
those who'd rather hide out during the holiday season--and after--SafeWeb
offers at least a little of that kind of protection. The company's free
service masks a user's IP address, permitting him or her to surf Web sites
without being traced. A SafeWeb user need only log onto the site and type a
Web address from within the firm's browser. SafeWeb launches a secure
browser which connects with the designated URL. Users wishing to maintain
their privacy should not fill out a form requiring personal information
while browsing with SafeWeb's browser, however, because that information
will be recorded as it would be for any browser. For those who like music,
the hoary old line about "making beautiful music together" took on new
meaning as Yahoo! and Imix.com signed a deal to allow users of Yahoo's
shopping portal to create a custom CD using songs from Imix's 200,000+
track collection. For up to 70 minutes of music, users will pay about $1
per song, plus $2.50 for shipping. Finally, perhaps to ease all that
shopping, AT&T will use technology from Qpass to allow AT&T Digital
PocketNet and AT&T WorldNet subscribers to buy items securely via
Internet-enabled wireless devices. 

Tech Companies Taking Stock--or Not
Wall Street's turbulent roller-coaster ride of late discouraged a number of
firms from coming out with an initial public offering of stock. Even market
leadership counted for little against this volatile backdrop. For example,
Verizon Wireless chose to delay its $5 billion IPO. It has not set a new
date, but most observers don't expect to see the offering resurface until
sometime next year. Internet incubator Idealab also joined the ranks of the
hesitant. A stakeholder in 35 online companies, the venture capital firm
chose to hold off on its own IPO, which it hoped would raise $300 million.
On the other hand, at least one bold company reaped a rich reward. Ixia
must have made Wall Street watchers nostalgic for the pre-April days when
it premiered its stock Thursday--its price doubled before closing at $21.50
per share, still quite respectably above its $13 per share starting price.
The company sells products which evaluate how quickly data packets are
transmitted over networks, how many packets are lost, and whether packets
are received intact. Finally, rumors run rife that WorldCom is planning to
create a tracking stock covering its consumer and wholesale operations, in
order to increase its focus on the more profitable portions of its
business: data, Internet, and international operations. 

More Good-Byes on the Dot-com Front
AltaVista CEO Rod Schrock resigned. The search service began its search for
a new CEO, in the meantime splitting the CEO duties between its chief
operating officer and its chief financial officer. The departure follows a
larger exodus in which about 200 AltaVista employees, or 24 percent of its
work force, were laid off. Schrock's exit appears voluntary, however.
Meanwhile, rumors are flying that Edmond Sanctis, the president of NBC
Internet, will resign his position to take some time off. Sanctis would be
at least the third high-level executive leaving NBC Internet this year; he
was preceded by former CEO Chris Kitze and former CFO John Harbottle.
Finally, Red Herring's staff gained firsthand familiarity with all the
dot-com layoffs they have been writing about when the company laid off 22
employees, about six percent of its work force. Ouch. 

Outage Ticker: Adobe
On Wednesday, software company Adobe fell victim to an attacker who managed
to bamboozle Network Solutions into transferring Adobe's domain name record
to Paycenter, an accredited registrar located in China. The hijacker then
changed the domain's contact information and name servers. Thanks to the
modifications, Web surfers trying to access Adobe's home page were directed
to Paycenter's home page. Additionally, Adobe employees could not receive
e-mail from outside the corporate network for most of Wednesday; messages
sent to adobe.com addresses bounced, sending "host unknown" messages to the
e-mailer. The site was back to normal as of Thursday afternoon. 

Cyberscape Delight: Scarier Than Halloween--But More Useful
Hate speech, whether or not it is covered by the First Amendment, excites
tremendous concern among many people. Perhaps those most worried are
parents who fear their teenage children may be hanging out with a dangerous
crowd. But such groups often hide behind symbols, both for their own
solidarity and to disguise their affiliations--most hate symbols are much
more obscure than the well-known swastika. Enter the Anti-Defamation
League. The ADL posted on its Web site a guide to hate symbols, which it
will keep continuously updated, so that parents, teachers, and others
watching over young people will be able to spot warning signs. Each symbol
is clearly represented; clicking on the symbol explains both its
traditional and more notorious usages. The Web site also encourages users
to send e-mail reporting new sightings.


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


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

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