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July 1, 2005

Dear Subscribers:

Next week the newsletter will be on summer break - it'll be back here and in your in-boxes on July 15. For daily breaking news, please check my blog. Happy 4th to all who celebrate it! Here's our lineup for the last week of June:

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FTC on P2P: Clearer picture of risks, improvements

While all eyes were on the Supreme Court's decision against file-sharing services in MGM v. Grokster on Monday (see Web New Briefs), a lot of people missed a meaty report from the Federal Trade Commission: "Peer-to-Peer File-Sharing Technology: Consumer Protection and Competition Issues" (in pdf format).

Interestingly, the risks of file-sharing were only the fourth one down in the FTC's list of conclusions - after describing what P2P enables, the variety of its applications, and the fact that the technology "continues to evolve in response to market and legal forces." The report, with the latest thinking and data on this extremely popular use of the Net (that is not going to go away because of a Supreme Court decision), is the product of a two-day P2P summit last December that brought together P2P software makers, academics, entertainment industry executives, tech-research firms, and representatives of government agencies and consumer groups.

The risks the FTC lists - to family computers and kids - have come up before in a few places, including in my "File-sharing realities for families," Childnet's "Young People, Music & the Internet," and's P2P page. But there is real value to multiple perspectives dispassionately pulled together by a government agency! Also, those of us who've been following P2P developments finally have some fresh statistics. And the report confirms that some of the P2P services have taken some steps to reduce the risks to kids and PCs. Here are the highlights:

Related links:

If you're reading this between July 15 and 21, click here for the latest news items.

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Web News Briefs

  1. P2P services can be sued too: Supreme Court

    This week the US Supreme Court sent a strong message to the file-sharing services: that they are responsible for their users' infringement of copyright law. The unanimous decision "stands to reshape an Internet landscape in which file-swapping has become commonplace," CNET reports. The decision "won't immediately shut down access to the trading networks, however." The Supreme Court sent the case back to the lower courts to review the evidence in light of this decision, CNET adds. Basically, it means that the P2P services now join file-sharers themselves as targets of lawsuits. There was an element of practicality in the decision: In writing the Court's opinion, the Christian Science Monitor points out, Justice David Souter "notes that, despite offsetting considerations about creativity and technological innovation, when there was such widespread infringement 'it may be impossible to enforce rights in the protected work effectively against all direct infringers.' He says the only practical alternative is to hold the device's distributor responsible under a theory of secondary liability." The entertainment industry estimates that 2.6 billion illegal downloads occur each month, the Monitor adds.

    But the key factor in the decision was the services' promotion of infringement. "We hold," Justice Souter wrote, "that one who distributes a device with the object of promoting its use to infringe copyright ... is liable for the resulting acts of infringement."

    As for the long term, the decision is probably the beginning of the end of the P2P free-for-all era. The pay-per-tune services like iTunes and Napster will be the early winners (and will get more flexible and innovative), the high-profile free services like Kazaa and Grokster will either die out or "go legit" (some are right now in the process), and free file-sharing will go further and further underground. As for users, Good Morning Silicon Valley asserts the decision "will really do little to influence the behavior of the hundreds of millions of individuals who already use file-sharing networks. Entertainment industry attorneys could pound StreamCast and Grokster into a fine white dust tomorrow ... but that will do little to curb the behavior of [file-sharers]." Here's the view from the pro-innovation, copy-leftist Electronic Freedom Foundation and CNET's P2P news round-up.

  2. Windows Update's update

    This is something all family PC owners will want to get: Microsoft Update, which replaces the old Windows Update system. If you're using Windows XP or XP Professional, you may've already gotten a prompt to install it, the Washington Post reports. "Microsoft Update fixes a few inconsistencies long present in Microsoft's patch strategy," and it will fix security problems with other Microsoft software (not just the OS) and third-party software running on Windows, the Post adds. Here's where you can find out more about it at Microsoft.

  3. Google adds video

    The search giant just added another medium to its mix. "Watching the amateur and professional videos in Google's index requires free software available at," the Washington Post reports. "The software, consisting of about 1 megabyte, won't do anything except stream Google's videos through the Internet Explorer or Firefox Web browsers." The feature is still in beta. As with most search engines, people can submit their own work (from Web sites to videos) for inclusion in the database. That can be good and bad. On the upside, the amateur videographer's work can now be as accessible as that of giant media companies - like garage bands on the file-sharing networks. The potential downside is what types of videos become as accessible to children as to anyone else. Surfing around the site, I was glad to find video policies saying that not only is Google not accepting illegal content, such as child pornography. It's also not accepting legal pornography or obscenity. [Yahoo also indexes videos. The difference, which is a plus while Google's player gets debugged, is that Yahoo's video search results can be streamed through well-established players like those of Microsoft and RealNetworks, and "some of Yahoo's videos include programming licensed from major television networks such as CBS and MTV," the Post reports.]

  4. Email hoaxes as teaching tools

    Getting an email about the lethal properties of NutraSweet/aspartame or a national cellphone do-not-call list or making a large amount of money by helping someone in a foreign country stash their cash can actually be a teachable moment for parents and kids. In this age when critical thinking is a precious commodity, sitting down at a computer with our kids and checking out a much-forwarded email like one of the above at sites like or can turn hoaxes into teaching tools. Sometimes these hoaxes get really visceral, like the Bush administration's "imminent plan" to reinstitute the draft. In his blog today, the Washington Post's security columnist Brian Krebs also mentions the one about "venomous, ravenous spiders that could be lurking under toilet seats."

  5. Scotland's new anti-grooming law

    The Scottish Parliament passed a tough new law to protect online kids. Among other things, the Protection of Children Bill "will make it an offence to set up meetings with under-16s via Internet chatrooms and carry a maximum 10-year sentence," the BBC reports. An interesting piece of it is the Risk of Sexual Harm Order, which courts can impose "to curb the activities of those suspected of being a danger to children." The order can be issued "even if the individual has not been convicted of an offence," according to the BBC. [Thanks to QuickLinks for pointing this news out.]

  6. The other kind of videogame

    Watch out, Halo and Grand Theft Auto, here comes Diner Dash! It's described as a little like I Love Lucy's memorable mad scramble at the candy factory conveyor, if anyone's old enough to remember that sweet old sitcom. "This game, sold exclusively on the Internet and downloaded onto players' personal computers, is challenging many of the conventions of video gaming," the New York Times reports, not least because games like Diner Dash - called "casual games" - are growing in popularity and are developed on a relative shoestring. At $20, Diner Dash has sold more than 50,000 copies and continues to sell at a 1,000/day clip, according to the Times. This is a good thing that will migrate to cellphones, and migrate they will - unlike the big-budget console and multiplayer games - because of their appeal and simplicity. The articles cites a PricewaterhouseCoopers projection of $8.4 billion in 2005 sales for the US game industry, with around $250 million of it for casual games. Meanwhile, did you know that nearly two-thirds of US college students "play video and computer games on a regular or occasional basis"? That's a Pew Internet & American Life figure cited by, Eastern University's student news site, which takes a look at the Pennsylvania school's weekly gaming competition. And here's the BBC on China's explosive gaming scene, with 20 million gamers and growing.

  7. P2P on phones

    File-sharing's coming to a cellphone near you. Nokia and other phone makers are developing software that will allow the sharing of text docs, photos, and eventually music on their phones, CNET reports. But this won't be the "Wild West" of file-sharing via computers, CNET says. Why? Because of "the tight control cellular providers have over their networks." On them, operators "can track every piece of data sent. They also have tough software that manages digital rights, and they typically have tracking technology built in to meet federal 911 laws, so operators can locate anyone they believe is illegally swapping files." Meanwhile, another CNET report updates us on ringtones, which young people love because they show off one's musical taste and are a fun way to customize a favorite gadget. Already a huge business, it generates $4 billion/year worldwide and "the No. 1 ringtone typically outsells the No. 1 [music] download." But the recording industry's "still struggling to connect with a generation used to getting music for free through Internet 'peer to peer' services."

  8. PlayStation in the classroom?

    Yup. For "exertainment" not "infotainment," in this case. The Redlands, Calif., school district is sweetening PE classes with exercise-promoting videogames, Wired News reports. "The classes would see elementary-school children getting their daily workout through popular video games like Konami Digital Entertainment's 'Dance Dance Revolution' [dance-pad game] and Sony's 'EyeToy: Play' that include active, physical elements." EyeToy is a camera game that lets players control the action on screen with their arms and head, Wired News adds. It cites a University of California, Berkeley, nutrition specialist as saying that anything that encourages kids to get up and dance is a good thing.

  9. iPod/phone?

    That's what the tech pundits are speculating about - see this in a San Jose Mercury News blog. And it makes sense: If there are picture phones and iPod Photos, why wouldn't Apple want to smoosh it all into one device that every teenager, who almost by nature is a world-class communicator, will want to get. And of course Apple will allow texting on that little screen. If phonemakers are turning phones into connected PCs, why wouldn't Apple move the iPod in that direction? The question is, will kids still want keyboards for their blogging and game players for their gaming (and DVD viewing)? Tell me what you think.

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That does it for this week. Have a great weekend!


Anne Collier, Editor

Net Family News

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