RIAA will be hard-pressed to land successor as wired on Capitol Hill as Hilary Rosen, departing as chmn.-CEO at year-end, observers said Thurs. Rep. Boucher (D-Va.), opponent on digital rights, expressed admiration for Rosen’s talents but said next Assn. chief should lead music industry into wholeheartedly embracing Internet by uploading its entire repertoire. However, others said significantly shifting strategy of industry made up of corporate heavyweights was too much to ask of trade association. executive.
In wake of Napster, peer-to-peer (P2P) networks have moved beyond trading MP3 music files into swapping content such as latest Sopranos episode and videogames. Diversity of content not only is driving creation of new P2P Web sites and applications, but also is creating bandwidth, legal and security issues for employers, report by Websense said Thurs.
Verizon Internet Services vowed appeal of decision by D.C. federal court ordering it to comply with RIAA subpoena seeking information on alleged online music infringer as many weighed in with reaction to case that has drawn national attention. Among them was copy protection giant Macrovision, which told Consumer Electronics Daily Wed. it was partnering with Websense to develop content filtering technology that ISPs could use to track and control traffic in unauthorized content transmitted on their networks, possibly absolving them from actions such as that against Verizon.
RIAA denied Tues. its chmn. had proposed charging ISPs fee for file-sharing and demanded correction from Reuters, which Assn. said originated widely reported account. RIAA Chmn. Hilary Rosen spoke Sat. at MIDEM music conference in Cannes, France.
With U.S. Supreme Court expected to rule relatively soon on fate of NextWave’s PCS licenses, some industry observers expect carrier could face challenges linked to drop in wireless spectrum values if court decided against FCC. Several analysts pointed to $750 million Verizon Wireless agreed to pay last month for NorthCoast PCS spectrum, including 10 MHz in N.Y.C., as sign of how far spectrum prices had fallen. Verizon had bid $4.1 billion in Jan. 2001 for 2 10 MHz licenses in N.Y. that since had been returned to NextWave. Others cited 28 of top 30 markets that NextWave spectrum covered, meaning that carriers still could pursue spectrum in market-by-market acquisitions.
CTIA plans to petition FCC next week to seek another delay in implementing wireless local number portability (LNP), Pres. Tom Wheeler said Wed. In July, Commission gave wireless carriers 3rd extension, to Nov. 24, 2003, to provide LNP in 100 largest Metropolitan Statistical Areas. Wheeler cited new CTIA data on wireline rate centers that 90% of time when consumers wanted to keep phone number when switching from wireline to wireless, “they're told to go pound sand.” Point of new challenge to LNP rules, he said, is that they shouldn’t be implemented until “the competition that they claimed they were doing in the first place is made possible by their rules.”
U.S. Supreme Court Justice Sandra O'Connor Fri. lifted temporary stay against Cal. Supreme Court decision holding that out-of-state Internet users who posted information on how to hack DVD copy protections couldn’t be sued in Cal. courts (CED Jan 3 p5). DVD Copy Control Assn. Inc (DVD CCA) applied for stay Dec. 23, saying it was necessary to prevent Matthew Pavlovich -- who would have been dropped from case under state ruling -- from posting reverse-engineered decryption program known as DeCSS (which decodes movies stored on DVDs). On Dec. 26, O'Connor stayed enforcement of state judgment pending receipt of response from Pavlovich. That response, filed last Thurs., contended DeCSS information has been readily available for “at least the past 2 years,” negating DVD CCA’s claims of urgency and possible harm. O'Connor’s reversal is “an important victory for us,” said Allonn Levy, Pavlovich’s attorney. Order is “in line with” what Cal. Supreme Court did when presented expert evidence that DeCSS is both useful and legal, and available online, Levy said. Levy said he expects DVD CCA to petition for certiorari. That’s one option, said DVD CCA attorney Gregory Coleman. Others include suing Pavlovich in Ind. or Tex., or convincing him to commit to “respect our trade secrets.” “We're obviously disappointed,” Coleman told us.
Philips threatened liability for patent infringement for any company selling, buying or trading optical discs from unlicensed replicators. Company administers licensing and royalty collection for optical disc patents it and partners own. In Dec. 10 letter, Philips said some replicators remained unlicensed and were infringing on patents, and in some cases were falsifying records and underpaying royalty. It said those replicators were candidates for litigation and product seizure, but it had legal right to collect royalties and damages from any company that had bought or traded infringing products -- even if that party wasn’t aware of supplier’s licensing and royalty status. Letter also said those knowingly purchasing unlicensed discs could be found guilty of willful infringement, with courts assessing treble damages. That would raise royalty to 9? from 3? on CDs, and to 15.9? from 5.3? on DVDs. Letter asked recipients to check Philips Web site for list of licensed replicators (www.licensing.philips.com) or to contact Philips at locations listed on Web site, and to demand suppliers document status of their licensing and royalty payments. On June 25, Philips filed patent infringement charges against 19 replicators and trading companies in U.S.
Red-letter day arrives soon for 321 Studios (321) and its lawsuit vs. content owners in federal court on legality of company’s DVD copying programs. Meanwhile, in follow-up to our report last week on efficacy of DVD X Copy software, we have learned from further testing how $99.99 program works -- and how it seeks to avoid violating anticircumvention provisions of Digital Millennium Copyright Act (DMCA).
Sampling of prefiled bills for 2003 state legislatures shows advanced services, telemarketing, consumer disclosure, spam, slamming and wireless services to be among concerns facing states’ lawmakers next year.