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Volume 2, Issue 38: Monday, April 3, 2000
- "Web's Design Hinders Goals of User Privacy"
Wall Street Journal (04/03/00) P. B1; Hamilton, David P.
The Web's underlying infrastructure is inherently conducive to allowing marketers and advertisers to collect personal data from Internet users. For example, Internet protocol addresses are easily manipulated to provide data about Internet users' online activities. That data becomes even more valuable if Internet users share their personal information on a Web-based form, allowing Web sites to tie the data to user names. Cell-phone users who participate with Sprint PCS' wireless Internet service expose their cell-phone numbers on the Web with each new page they call up. New software will become available to mask users' phone numbers, Sprint officials say. Remote host identifiers are known to leak users' personal data, including users' employers, and even their names. High-speed connections are not as good at protecting users' privacy as are modems, which normally give users a temporary IP address. And of course cookies always present a threat to consumers' online privacy. Relief in the form of the Platform for Privacy Preferences could be on the horizon. P3P, developed by the World Wide Web Consortium, will be tested this summer, but will not be very effective unless adopted by many browsers and Web sites.
- "Microsoft Settlement Efforts Collapse"
Wall Street Journal (04/03/00) P. A3; Wilke, John R.; Buckman, Rebecca
Judge Richard Posner of the U. S. Court of Appeals announced Saturday that he had ended settlement talks between Microsoft and the federal government in the ongoing antitrust case, stating the previous four months of negotiations had not brought the two sides any closer to reaching an agreement. "It is apparent that the disagreements among the parties concerning the likely course, outcome, and consequences of continued litigation, as well as the implications and ramifications of alternative terms of settlement, are too deep-seated to be bridged," said Judge Posner. Microsoft blames the breakdown of the talks on the inability of the states and the Justice Department to effectively collaborate and their insistence upon including unnecessarily harsh sanctions in any settlement. The government blames Microsoft's unwillingness to accept constraints upon its business practices for the failure of the negotiations. With settlement talks terminated, Judge Thomas Penfield Jackson will likely issue a verdict, expected to be against Microsoft, by the end of this week. Microsoft intends to appeal any ruling not in its favor, a move that would result in at least another year of litigation but would free the company to concentrate on securing its position in the Internet software market and expanding its reach into the high-end server market.
- "Some Countries Seek Keys to Digital Code-Scramblers"
New York Times (04/03/00) P. C4; Clausing, Jeri
Although many countries around the world are liberalizing rules on encryption, many are attempting to expand computer surveillance powers of various law enforcement agencies, according to the Electronic Privacy Information Center (EPIC). Singapore and Malaysia now require computer users to give encryption keys to law enforcement authorities upon request or be fined or jailed. Britain and India are also considering similar laws, although legal analysts say that such a practice amounts to self-incrimination, which people are protected against in many of the world's legal systems. In the U.S. and several other countries, bills are being proposed that would mandate that third-party escrow agents give encryption keys to authorities upon request, so that individuals would not be required to incriminate themselves. Intelligence and law enforcement agencies worldwide are also being granted increased funding and expanded powers for computer surveillance, EPIC says.
- "Gateway to Sell Training Gear for PC Music and Finance Photos"
Wall Street Journal (04/03/00) P. B14; McWilliams, Gary
Gateway today will announce four new packages that will provide equipment, services, and training for users in the areas of digital photography, music, finance, and Internet use. The packages include peripherals such as a digital camera or a scanner, as well as classes that show users how to set up and use the technology. Customers can buy the packages as part of Gateway's YourWare computer-leasing program or separately at prices ranging from $229 to $649. Gateway plans to add more training and software packages, expanding to areas such as video-editing, says senior vice president of consumer products Cliff Holtz. By the end of the year, Gateway plans to offer 12 such packages. The move is part of Gateway's effort to increase non-PC revenues as computer prices drop. Gateway recently estimated that 40 percent of its net income this year would come from services. In separate news, Gateway announced that it purchased a 7.6 percent stake in the Spanish-language Web portal Quepasa.com for $10 million.
- "'Massive' Software Piracy Hitting Argentine Industry"
Financial Times (04/03/00) P. 6; Warn, Ken
Widespread software piracy in Argentina is hampering that country's attempt to become the Silicon Valley of South America. Various groups that track software piracy say that roughly 95 percent of the consumer software in Argentina is pirated, bringing the country in line with others in the Middle East and South-East Asia where piracy is endemic. Although Argentina has begun cracking down on the problem recently with stricter laws, critics say that piracy prosecutions are extremely difficult and arduous, and the procedures for such prosecutions need to be simplified. Argentina imports pirated software from Asia and manufactures its own. Officials say that pirated software is sold openly in Argentina.
- "UCITA 'Picking Up Speed' in Md. Senate"
Washington Techway (03/30/00); Terry, Rob
The Maryland General Assembly's Senate Finance Committee late last week was expected to ensure that the Uniform Computer Information Transaction Act is swiftly introduced to the floor of the upper chamber this week. Maryland Gov. Parris Glendening's chief of staff, Major Riddick, says Senate leaders have told him they will not pause to study the legislation, as Virginia has chosen to do. However, officials are attempting to buttress the bill's consumer protections. "It's a slow train picking up speed," Riddick said. The bill will likely receive approval before adjournment on April 10, according to lawmakers and Glendening officials.
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- "Survey: Y2K Bug Bit Nearly 12 Percent of Companies"
Daily Yomiuri (03/31/00)
The Y2K bug has struck 11.6 percent of about 2,500 companies and organizations in Japan since the end of last year, according to a newly released government survey. The survey, which ended in early March, targeted companies in 12 industries that deal closely with the public, including electricity, gas, water supply, nuclear fuel facilities, electronic communications, finance, aviation, railways, and medicine. The government said that 3.1 percent of the companies affected by the Y2K bug reported that the glitch had disrupted their public services. The government submitted a report on the survey to a Y2K advisory panel headed by IBM Japan top advisor Takeo Shiina.
- "E-Commerce Patent Wars Must End"
E-Commerce Times (03/30/00); Dembeck, Chet
Due to the magnitude of the complaints and questions raised, the U.S. Patent and Trademark Office (PTO) will commence overhauling its review process for awarding e-commerce patents. The office has been accused of stunting the growth of e-commerce by granting patents to only a few companies for technology and processes that are not truly unique. Amazon.com was granted a patent for its shopping tool that stores shipping and billing information for its repeat customers, and when BarnesandNoble.com implemented a similar technology, Amazon objected due to its patent. Due to staff and time constraints, the PTO did not recognize that Amazon's technology was not new, states Richard Stallman, a developer of the Linux operating system. After much debate, Amazon CEO Jeff Bezos has proposed in an open letter on the company's Web site that software and business-method patents last only three to five years, which is less than the 17 years they last now. Bezos also proposed that before patents are issued, outsiders should have the chance to comment, and that a software repository be organized to ensure technology is truly unique before patents are granted. The PTO immediately rejected the proposal for a shorter time period for e-commerce patents. However, it has agreed that more e-commerce community help is needed, along with a software repository.
- "Sites That Never Sleep"
Industry Standard Online (04/03/00); Oh, Jenny
Many businesses, particularly large firms or fast growing but resource-limited Web startups, are turning to Web hosting and maintenance services as a fast and often cheaper option to doing the job themselves. Companies offering business-continuity, caching, colocation, failover, load balancing, site mirroring, and managed Web hosting services are working in a market expected to reach $14.6 billion by 2003, up from $2 billion this year, according to Forrester Research. IBM's $5 billion partnership last week with fiber-optic network company Qwest illustrates the growing importance of offering a full range of hosting services. Once just a provider of high-speed network access, Qwest teamed with IBM to offer its customers complete hosting, monitoring, management, and recovery services. Other players in the hosted services market include Level 3, Digex, and GTE Internetworking. Forrester Research reports that 66 percent of companies cite a lack of internal resources as the main reason for contracting with a Web host. "We would have been under construction for at least six months if we chose to run the servers ourselves, plus we simply didn't have access to that kind of capital as a startup," says Yourownworld.com CTO Ira Dworkin.
- "Companies Aren't Rushing to Conduct Business Online"
Computerworld (03/27/00) Vol. 34, No. 13, P. 20; King, Julia
Industrial corporations are not moving quickly into e-business despite media hype that suggests otherwise, according to a recent PricewaterhouseCoopers survey. Only 40 percent of large firms take orders online, and just 28 percent accept electronic payments, the survey shows. Although respondents believe that e-business is important, only a fourth of those surveyed have made a significant move into e-business. "These are big companies that have a lot at stake with their brands, relationships with supply chain partners, and customer reactions," says Ed Berryman, the study's author. Large companies are taking a cautious approach to e-business and are watching for examples of other major firms migrating online, Berryman says. These companies are readying themselves internally to move into e-business, and plan to bring in 20 percent of revenue from e-commerce by 2003. Currently, 79 percent of respondents say 5 percent of revenue comes from e-commerce.
- "Enterprise Software Projects Rarely Satisfy"
InternetWeek (04/03/00) No. 807, P. 27; Booker, Ellis
The Boston Consulting Group recently interviewed 100 individuals who at some point during the previous three years directed the implementation of an enterprise initiative and found that only 33 percent of respondents viewed their enterprise software projects as successful with respect to value creation, cost-effectiveness, financial impact, and goal attainment. Although 60 percent of survey participants claimed their efforts were worthwhile, only 52 percent said they had attained their business objectives, and only 37 percent claimed their initiatives resulted in positive financial outcomes. Also, 56 percent of individuals who analyzed their enterprise initiatives claimed they had achieved positive outcomes, as opposed to only 8 percent for respondents who did not conduct analyses. Additionally, nearly 20 percent of respondents felt they had paid more than necessary and could have achieved the same results for a lesser cost. The results of the survey do not support the idea that working with a vertically integrated vendor on an enterprise initiative leads to a more positive outcome than does utilizing resources from several different vendors.
- "Fraud on the Net"
Business Week (04/03/00) No. 3675, P. EB58; Carney, Dan
New scams have been popping up online with unprecedented ferocity due to the Internet's ability to reach millions of people simultaneously and provide anonymity for perpetrators. Credit-card fraud, auction scams, and get-rich-quick schemes have now become common on the Internet. The National Consumers League says people and businesses lost $3.2 billion in 1999 due to Internet fraud, and the FTC says one-fourth of its consumer complaints deal with the Internet, as compared to only 3 percent in 1997. One of the newest scams is hijacking Web pages and trafficking visitors to other sites, such as porn pages, in order to inflate that site's number of "hits" and boost advertising rates. Another new scheme is the planting of a bogus press release on a company's Web site that says the particular company is going to be bought at a huge increase over its current share price, causing the stock to surge. However, there are various new software products that can be used to combat some of these scams. For example, Expedia.com has profiling software that can alert system operators to suspicious activity by analyzing whether a credit-card number is coming from the same Internet address it always comes from, and whether it is routed through a computer with a history of fraud. After all this data is analyzed, the computer places a risk rating on the transaction, and the merchant can then decide whether to pursue further investigation. Federal help is also on the way. In May, the FBI will team with the National White Collar Crime Center to create an Internet fraud center with 161 full-time employees.
- "Fast, Phat Sites"
InformationWeek (03/27/00) No. 779, P. 22; Wallace, Bob
Content delivery services are taking the burden of infrastructure problems off of Web site operators, enabling the sites to focus on improving content. Last week, caching network operators enhanced their networks to pave the way for services such as streaming audio and video, content delivery to mobile devices, and bandwidth management. For example, Akamai Technologies acquired streaming media firm Intervu, while Exodus Communications purchased content-distribution provider Mirror Image Internet. Meanwhile, content-distribution provider Adero bought Fast Engines, which provides software for personalizing content, as well as Starburst Software, which makes software for online content broadcasting. Digital Island announced plans to offer content delivery to mobile devices. Content-delivery firms believe companies will seek their help in improving Web sites because their services are inexpensive and fast. Akamai's caching services recently helped Sportsline.com manage 333,000 hits a minute and deliver pages as much as 15 percent faster during the first four days of college basketball's March Madness, which otherwise would have been a huge strain on the site. The global market for content distribution and delivery is expected to reach $6 billion by 2004, up from $374 million this year, says Jupiter Communications.
- "Is Security the Next Big Thing?"
Network Computing (03/20/00) Vol. 11, No. 5, P. 72; Shipley, Greg
Roughly 90 percent of the organizations polled use firewalls and antivirus software, and 60 percent believe that their security products and measures are both top-of-the-line and very current, according to a recent Network Computing magazine computer security survey of 500 various organizations. Forty-two percent of the respondents say intrusion-detection systems will be the hot new product in the coming year, and the same percentage plans to purchase some type of intrusion-detection system. Although the survey reveals some positives about corporate computer security, such as the fact that companies seem to be taking it more seriously and are confident in their products and policies, Network Computing questions whether the respondents are simply naive. This is because only 23 percent of the organizations say they actually review their security systems and policies on a regular basis, despite the fact that 60 percent claim that those systems and policies are up to date. Fifty-four percent of respondents outsource their firewall management, 34 percent outsource their antivirus mechanisms, and 63 percent have no full-time IT security staff. These facts lead Network Computing to believe that many organizations are ignorant when it comes to computer security, and that these organizations simply purchase a few products and then bury their heads in the sand, hoping the products will be the silver-bullet that averts a potential calamity. On the positive side, Network Computing says the survey shows a growing interest in computer security products, which should translate into more sales of such products, particularly intrusion-detection devices.
- "Fiber Optics to the Home"
Technology Review (04/00) Vol. 103, No. 2, P. 49; Hecht, Jeff
Slow information speeds and jerky, low-resolution pictures have millions of Web surfers dreaming of an online world of more fluid connections. Wiring homes directly to optical fibers appears to be the solution, but cost is a major concern of telecommunications companies. Asim Saber, president of Optical Solutions, says installing fiber can cost anywhere from 15 percent to 25 percent more than DSL or cable lines. But he believes it will be worth it, considering the likelihood of having to rip streets up once again as demand for the benefits of greater bandwidth increase during the next few years. Aside from Web surfers, companies doing business on the Internet will want higher capacity to enhance e-commerce. Although cable modems and DSL offer a few megabits per second, 100 Mbps would deliver the full-screen, full-motion video that many high-end users desire. In fact, a single optical fiber can carry 600 Mbps. Fiber actually was offered to consumers years ago but it never caught on because a need for the technology was never identified. But now that the Internet is here, e-commerce appears to be reason enough to provide fiber to homes. BellSouth is now involved in a project in Dunwoody, Ga., to permanently fiber-connect homes. In a few months, about 700 homeowners in Palo Alto, Calif., will have fiber, and homes in five Toronto suburbs are also in the process of receiving fiber connections. Technical standards will be needed if there is to be a greater penetration of fiber optics, and a number of telephone companies have come together to create the Full Service Access Network (FSAN) that will connect telephone company facilities to homes and businesses. Analysts still do not know what to make of the potential growth of fiber optics, although the Internet is expected to increase demand over the long term. Some market observers suggest the responses of cable operators and consumers to digital high-definition television could determine whether a huge demand will emerge in the next few years.