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Editor's Note: Keep up to speed with CES happenings by visiting our Tech Daily Dose blog.
Intellectual Property
Electronics Guru Takes Stand For Copyright Reform
by Andrew Noyes
LAS VEGAS -- The dean of the consumer electronics sector, Gary Shapiro, used his opening keynote at the Consumer Electronics Show here on Monday to promote "fair use" of copyrighted content for technology users and the Digital Freedom campaign that he helped launch last year.
The initiative to oppose "crippling restrictions" on individuals' technology rights, unveiled in October, was met with opposition from the content industry. The project has a major presence at CES this week.
For two decades, Shapiro and his team have fought legislative proposals that would "restrict, tax, ban and hobble" technologies, he said. Those efforts have been successful, but innovators still face "debilitating lawsuits" as consumers and venture capitalists remain worried about the legal limits of new products and services, he said.
"Content creators must be compensated" and "commercial piracy is wrong," Shapiro told a sea of technologists, reporters and analysts. "We understand and share an aversion to those who steal content without authorization."
The difference between his view and that of the movie and music sectors is that "we draw a different line" for what is acceptable regarding in-home use of authorized content, he said. "We believe that consumers have rights and that copyright laws need to be changed."
Shapiro will continue to back the Digital Freedom campaign in the year ahead and support legislation to safeguard technologies that will be launched at CES in the years to come.
This year's CES hosts more exhibitors in more space than ever before, Shapiro said, with 2,700 booths in 1.8 million square feet of exhibition space. These "totally new, cool technologies" will help make 2007 a record-setter for the industry, he said. Consumer electronics sales are predicted to reach $155 billion by year's end.
Such innovations "create something new, and by doing that, they challenge something old," Shapiro said. "They breathe new life and features into familiar products" and transform lives, businesses and economies.
When "convergence" emerged as a buzzword 10 years ago, he said, "we debated whether it was TV or the PC that would dominate. Today that battle is totally over" and the focus is on the promise of nanotechnology, biometrics, robotics and other inventions.
"Our digital world is a world of opportunity," he said. "It is a global opening of the American dream."
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E-Commerce
New E-Gambling Ban Remains Subject Of Contention
by Andrew Noyes
LAS VEGAS -- Internet gambling was among the hot topics debated by a panel of Republican congressmen here Monday in a city fueled by poker, blackjack and slot machines.
A new law criminalizes the estimated $12 billion e-gambling industry in the United States. Rep. Bob Goodlatte, the Virginia Republican who sponsored the bill, said last year that he believes it will fight the "ill effects" of gambling on society. Critics argue that the action may spur more organized crime.
Despite Congress' opposition to e-gambling, Nevada Republican Jon Porter warned that the illegal business will continue to thrive by way of offshore suppliers. As was the case in the 109th Congress, he called for a further examination of the issue.
"It's going to continue to happen ... and I believe that Internet gambling should be taxed and regulated," he said. The former Boulder City, Nev., mayor said he has "seen what can happen with the abuse of gaming" and he "wants to make sure it's safe and regulated."
There may be opportunities in the new Congress for lawmakers to study the impact of Web gaming, as the body does with other areas of the Internet, he said. Porter said Capitol Hill "hasn't dealt with a lot of gaming issues" the way that local governments have.
Virginian Tom Davis, the ranking Republican on the House Government Reform and Oversight Committee, said he supports a study and could back Internet gaming "if it's appropriately regulated."
Darrell Issa of California took the position that "we're not equipped to regulate it," mainly due to the question of states' rights to control citizen access to gambling. Issa supports the Web gaming ban "until we can, in fact, reasonably control it."
Panelists also discussed how the "network neutrality" debate would be reprised in the Democrat-controlled Congress. The issue is whether the government should mandate equal treatment of content on high-speed Internet networks.
Davis believes it could become a tool for "political posturing" during the 2008 presidential campaign, but "any kind of legislative conclusion, I think, is unlikely."
AT&T's willingness to self-impose net neutrality provisions as part of its recent FCC-approved merger deal with BellSouth could have an interesting effect on the larger debate, he said. Still, Bell companies "have always done very well in the House," Davis noted.
The battle over digital copyright protections also is worth monitoring, Issa said. California Democrat Howard Berman, who is expected to chair the House Judiciary Committee's intellectual property panel, has a strong desire "to draw lines on fair use."
But fellow subcommittee member and Virginia Democrat Rick Boucher, who sponsored a bill last session that would have repealed some provisions in the Digital Millennium Copyright Act against circumventing anti-piracy tools, has a different take on the topic, Issa said.
Lawmakers should be able to agree that if Congress does not act, the courts, "who are supposed to be the arbitrator of contract sanctity," will. Issa believes it is important not to revoke guarantees made to the copyright community decades ago, "either to the benefit or detriment" of those with whom the promise was made.
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Security
Key Republican Blasts House Democrats' Security Bill
by Chris Strohm
The top Republican on the House Homeland Security Committee and his Republican staff fired an opening salvo Monday against efforts by House Democrats to implement unfulfilled recommendation of the 9/11 Commission. The move sets the stage for an acrimonious scene when lawmakers debate the bill on the floor Tuesday.
In a 9-page report, Rep. Peter King of New York and his staff argue that House Democrats are failing to implement all the ideas of the panel that investigated the Sept. 11, 2001, terrorist attacks and that they previously voted against legislation to enact several key reforms.
The report also protests that Democrats are not providing a fair and open process for debating and passing their bill to implement the proposals.
"In only their first few days in the majority, House Democratic leadership has already fallen short on the key security promise they made to the American people," King said in a statement. "Republicans have already enacted an overwhelming majority of the recommendations, and the opening of the 110th Congress was a terrific opportunity to finish the job. Unfortunately, it is amounting to nothing more than a missed opportunity. I'm very disappointed."
House Speaker Nancy Pelosi, D-Calif., Homeland Security Chairman Bennie Thompson, D-Miss., and two Democratic members of the 9/11 Commission fired back at a news conference, saying their bill will make America safer. "This step tomorrow is a vital step for 9/11 reform and a giant leap for the national security of America," commission member Tim Roemer said.
The report from King and his staff opens with a Pelosi quote reported in CongressDaily that House Democrats will pass all the 9/11 Commission recommendations on the first day they control Congress. But the report notes that the Democratic bill does not address some recommendations, such as consolidating congressional oversight of the Homeland Security Department; transferring responsibility for paramilitary operations from the CIA to the Defense Department; and declassifying the overall intelligence budget.
The report also said the bill would duplicate several Republican initiatives, such as overhauling the homeland security grant formula and creating a grant program specifically for building communications systems that work across jurisdictions.
The report criticizes Democrats for three years of votes against legislation that would have implemented some 9/11 Commission recommendations. For example, the report notes that House Democrats voted against a 2005 budget bill that established a $1 billion grant program specifically for interoperability and emergency communications.
"There's a clear contradiction here, as the Democrats all voted against the creation of a $1 billion interoperability grant program last Congress," King told CongressDaily. "I'm glad they've seen the light and now agree with our approach."
A Democratic aide said the 2005 bill was opposed on a party-line vote because it was so massive and included many measures Democrats did not support. "I don't think it's fair to say we voted against an interoperable grant program," the aide said.
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On The Hill
Techies Are Glad To Have Rep. Hall In Key Science Slot
by Aliya Sternstein
Many high-tech lobbyists are giving a thumbs-up to Rep. Ralph Hall, the Texan that minority Republicans picked for ranking slot of the renamed House Science and Technology Committee.
Hall replaces former committee Chairman Sherwood Boehlert, R-N.Y, who retired at the end of the 110th Congress. Their party lost control of the chamber in the November election.
Hall's focus in the minority this year will be on maintaining America's leadership in the global race for innovation, he said in officially assuming the position late last week.
"America's technological edge relies in large part on our space exploration and research and development programs," he said. "Investments in science, space and technology account for half of our nation's productivity growth and bring returns far exceeding the original public investment."
Another top priority of his will be energy independence. He wants further research into alternative energy sources and more development of new technologies.
Hall, who switched parties in 2004, has served on the committee since being elected to Congress in 1980. He chaired the Energy and Air Quality Subcommittee of the Energy and Commerce Committee last year.
John Palafoutas, a lobbyist for the technology trade association AeA, said Hall and committee new Chairman Bart Gordon, D-Tenn, will be a good match. "They both talk Southern, so I think they'll be able to get along well and that's critical," Palafoutas said.
Texas is one of the top U.S. marketplaces for technology, he said, adding that Hall's former subcommittee chairmanship will aid him in his new Science and Technology capacity. "So many high-tech issues go through that committee [Energy and Commerce], so he's really knowledgeable. The energy industry is very high-tech."
Hall was a leading force behind the 2005 energy law, in part to help the oil and gas industry in his home state. Now he plans to promote cyber security and protection against natural disasters through better prediction equipment and communication systems.
He is a supporter of education reforms to help students compete. And he backs the vision of the National Aeronautics and Space Administration to take man back to the moon and then to Mars.
The Electronic Industries Alliance feels the tech sector is in good hands with Gordon and Hall as committee leaders. Kevin Schweers, EIA's vice president for communications, said the lawmakers "will be strong advocates for American competitiveness and reliable votes for legislation fostering new jobs and growth in the U.S. technology sector."
Likewise, other industry groups sense that having two tech policy veterans at the helm will forge consensus on competitiveness issues.
Michael Wendy, a spokesperson for the Computing Technology Industry Association, said, "They understand our industry and its underlying infrastructure, knowing well the ceaseless pressures that the global economy exerts on U.S. tech leadership."
Hall has been a "strong and effective" advocate of increased collaboration among the federal government, academia and private industry to advance science, said George Scalise, the president of the Semiconductor Industry Association.
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E-Government
Tax Season Begins With Policy Changes, E-Filing Push
by Winter Casey
The Internal Revenue Service began the 2007 income-tax-filing season by encouraging all taxpayers to file their returns electronically. The agency also released guidance on how to cope with last-minute changes in tax policy in 2006 and information on federal excise-tax refunds.
Currently taxpayers who wish to file electronically can do so by going to authorized tax preparers, using over-the-counter software, or going through the Free File program, according to an IRS spokeswoman. The program allows free e-filing for eligible taxpayers and is headed by the Free File Alliance and the IRS.
The agency announced that ancillary offerings such as solicitations for refund loans -- which sometimes carry high interest charges and fees -- will be removed from Free File this month.
The IRS has advised the public that taxpayers who file their taxes electronically will get their refunds faster and drastically reduce their chances of making errors. In order to address the people who do not have Internet access or computers, IRS spokeswoman Nancy Mathis said "the IRS partners with organizations that operate 12,000 free tax-preparation physical sites nationwide to help lo-income and elderly people to file their taxes."
Mathis said that currently, paper returns must be manually entered into electronic forms by IRS employees. In 2006, roughly 54 percent of taxpayers filed electronically, she said. Money saved from new technology has been diverted to customer service and enforcement, Mathis added.
The IRS also has advised taxpayers to visit its Web site in order to receive information on how a new law affects their taxes.
This year, individual taxpayers can request refunds if they paid the federal excise tax on long-distance or bundled telephone service between Feb. 28, 2003, and Aug. 1, 2006. The government stopped collecting the tax on long-distance service in August 2006. The IRS expects more than 146 million individual taxpayers to request the refund.
The e-filing system has been updated to reflect the elimination of that tax, but paper forms went to print before the law was enacted in December.
Members of the 110th Congress wasted no time last week introducing bills that would eliminate the remaining portion of the tax that applies to customers who receive only local phone service. Sens. John Ensign, R-Nev., and Charles Schumer, D-N.Y., filed measures on the subject.
IRS.gov at times is one of the most heavily visited Web sites in the world and so the agency has tried to make the site more user friendly, Mathis noted.
Over the last couple of years, the IRS increasingly has offered new online tools to help educate taxpayers. Mathis said one of the most popular features allows users to check the status of their tax filings and track their refunds.
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Intellectual Property
Copyright Board Takes Steps To Set Music Royalties
by Andrew Noyes
The U.S. governmental body charged with setting music royalties on Friday unveiled a proceeding to set rates for services like Music Choice and Muzak that sell businesses tunes to pipe through retail spaces and restaurants.
Under the licensing regime, digital services pay royalties for both the transmission of music and the reproduction of sound recordings used to make the public performance. That temporary file, stored on a hard disk or server, is created for the sole purpose of making the digital transmission.
Satellite and Internet radio services pay both for transmission and ephemeral recordings, but an exemption in copyright law lets "business establishment services" pay only for the copies, said Willem Dicke, a spokesman for the performing rights organization SoundExchange.
The Copyright Royalty Board's rate for firms like Muzak is currently 10 percent of gross revenue, with a maximum annual fee of $10,000, he said.
The board's latest endeavor, just published in the Federal Register, is one of several ongoing rate-setting proceedings, joining those for webcasters and satellite radio. The board which was established as an arm of the Copyright Office in 2004, began its work last year.
The board's predecessor, the Copyright Arbitration Royalty Panel, set the first fees for Muzak and its peers in the initial webcasting proceeding six years ago. The Librarian of Congress announced the determination of the reasonable rates and terms on July 8, 2002.
Some may view the current fee to business establishment services as less than a bargain. The amount charged for performance and ephemeral rights to new subscription services under the rates negotiated in 2003, for example, is only slightly higher at 10.7 percent.
Officials with Muzak and attorneys expected to petition the board declined to comment on whether the current rate is adequate or needs adjustment. Petitions to take part in the proceeding are due Feb. 5.
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Science
Businesses Win Research Time On U.S. Supercomputers
by Heather Greenfield
For Boeing, being competitive means building new airplanes in less time and at less cost, with no additional risk. The company hopes to use government supercomputer time it won to better model how plane wings bend and twist, and how an engine reacts to the malfunction of a fan blade.
Boeing is one of 45 projects for which the Energy Department's science office awarded 95 million hours on a few of the world's most powerful supercomputers at four national laboratories.
Michael Garrett, director of airplane integrity and performance for Boeing, said it is difficult to even calculate the monetary value of such an award, saying the savings of doing computer simulation versus building models is "huge." He said the cost of a failed engine blade is hundreds of millions of dollars.
Garrett said catching a design failure earlier in the design process is important because that step comes when so much has already been invested.
Boeing was one of seven U.S. businesses awarded supercomputing hours announced Monday. Other winners included Corning, Fluent, and Proctor and Gamble, along with continued awards from a previous year for DreamWorks Animation, General Atomics, and Pratt & Whitney.
The award used to just go to university and government institutions but was expanded to industry in 2005 based on recommendations by the Council on Competitiveness.
Benoit Roux, who represented a biology team at the University of Chicago, said the supercomputer time will help his project build a better understanding of how proteins interact could lead to drugs that address a specific problem without interfering with needed functions -- like heart rhythm. He described the scope of the project as almost "crazy" but "within reach, like climbing Mount Everest."
The science office launched the INCITE program in 2003 to share government resources in hopes of speeding innovation for all those working with similar issues. The results of any experiment should be published and shared.
Energy noted an article in this month's Nature magazine about a scientific discovery on how stars are produced. It was an unexpected result of a supernova simulation done through the program.
Science Undersecretary Raymond Orbach said that until now, science was based on two pillars -- experiment and theory. He said supercomputers represent a third tool to tackle problems for which there is no theory or are too complicated to analyze.
Orbach said he was able to carve out the precious computer time because his office is budgeted 10 percent of the computing hours and he thought the peer-reviewed award program was a good way to spend it.
Deborah Wince-Smith, president of the Council on Competitiveness, said the private sector often cannot afford to invest in supercomputing at this level. "That's why public-private partnership like this is so important," she said. "This is truly a win-win program for the country."
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Editor's Note: On The Download is Hotline's weekly dispatch on politics, multimedia and the Internet. Starting today, Technology Daily will republish a version on Mondays.
On The Download
George Miller, Let's Play 'This Is Your (Second) Life'
by Shira Toeplitz, The Hotline
A Democratic politician ventured for a second time into the virtual Internet world known as "Second Life" last week.
Following the swearing-in ceremony for the 110th Congress, Rep. George Miller, D-Calif., held an invitation-only press conference on a virtual Capitol Hill (on an island no less!) to discuss Democrats' top six priorities for the session.
Miller, in avatar form complete with white moustache and grey suit, spoke to guests for about a half-hour. All questions were sent through moderator and Rocketboom video anchor Joanne Colan.
The computer-simulated chamber permanently opened its doors to the public -- or at least for Second Life users. The set-up lets avatars discuss Democrats' "Six for '06" in individual pavilions assigned to each of the policy issues.
The Internet marketing firm Clear Ink developed and sponsored the virtual Hill.
Although Miller said during the conference that he practiced a few times before the virtual event, that might not have prepared him to see a couple of conference guests float through the air of the virtual House.
Unlike former Virginia Gov. Mark Warner, Miller retained his avatar's gender throughout the conference. Warner's Second Life conference of last year often is remembered for his metamorphosis into a woman and then back to a man on stage.
Not Afraid Of ComMITTment
Former Massachusetts Gov. Mitt Romney launched his presidential exploratory committee Web site a day before Miller's Second Life experience. Romney joined fellow Republicans Rudy Giuliani and Sen. John McCain, R-Ariz.
Romney's site boasts the most features and content by far of the three GOP candidates. It is also the only site that is updated regularly.
The site relies heavily on online video. Entitled MittTV, Romney takes advantage of one of his best assets as a candidate -- his natural chemistry with the camera.
The video platform is by PermissionTV, a commercial vendor that specializes in delivering television to the Web. The rest of the site was designed by Molecular, an Internet consulting firm that seems to create sites mostly for business clients.
Notably, there is no blog on the site yet, but Romney Online Director Stephen Smith is known for his work with former Senate Majority Leader Bill Frist, R-Tenn., in that area.
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Today's Feature:
Issue of the Week
One thing is abundantly clear within a massive bill from House Democrats to implement unfulfilled recommendations of the commission that investigate the Sept. 11, 2001, terrorist attacks: Lawmakers are depending heavily on technology to solve gaps in homeland security.
Every Monday, read the Issue of the Week by the Technology Daily staff.
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E-briefs
Privacy: The Supreme Court on Monday rejected a challenge to federal airport regulations that require passengers to show identification before boarding airplanes, AP reports. In Gilmore v. Gonzales, the justices upheld an appeals court ruling against John Gilmore, a libertarian activist and millionaire who had sought federal government disclosure of the policy that requires passengers to show identification. Gilmore said that if the regulations are not made public, air passengers have no way of knowing if they call for impermissible searches. He also argued that the secrecy violates privacy and due-process rights. His attorneys wrote in a legal brief last year that the "question is whether the government can -- without any plausible explanation -- enforce against the general public a law, the text of which it insists must be kept secret." The Transportation Security Administration has not disclosed the details of its ID policy.
E-Government: The shuttering of five Environmental Protection Agency physical libraries has lawmakers and EPA employees worried about online access to agency information, according to a Jan. 3 Congressional Research Service report. The president's fiscal 2007 budget would reduce the library system's funding mainly by closing physical libraries and digitizing physical contents. EPA staff and the public had used the original 26 libraries to research topics like pollution control. While EPA plans to post certain materials online, "some items may be archived or discarded," the report stated. "Of the collections that are retained, it is uncertain which materials will be converted to electronic format and made available through the Internet, or physically archived." The 109th Congress did not address library closures in the fiscal 2007 appropriations bills, but both chambers criticized the EPA's pre-emptive actions last year. The 110th Congress has the opportunity to revisit the issue, the report stated.
Education: Sen. Christopher Dodd on Monday introduced a bill that would create voluntary standards for mathematics and science education in elementary and secondary schools. Dodd took action partly because the education law known as the No Child Left Behind Act -- celebrating its fifth anniversary on Monday -- has more than 50 different sets of academic standards, 50 state assessments and 50 definitions of proficiency. Students are graduating from public schools with unequal knowledge, skills and readiness to compete in the global economy, said Dodd, D-Conn. Under the draft legislation, competitive grants of up to $4 million each would be available to state education agencies for assistance in adopting the standards. Dodd stressed that the bill would not mandate a national curriculum or tell teachers how to teach. The bill would authorize $403 million for creating the standards and endowing the state incentive fund in fiscal 2007.
On The Hill: Sen. John Sununu announced Monday that he is drafting legislation to bar the FCC from imposing technology mandates on the communications industry. "Whether well-intentioned or not, the FCC has no business interfering in private industry to satisfy select special interests or to impose its own views," he said in a statement. "My legislation will ensure that decisions about the design and development of products and services to meet FCC rules are made by technology experts, not government regulators." News of the bill came as the Senate Commerce Committee announced a Feb. 1 hearing on "Assessing the Communications Marketplace: A View from the FCC." The New Hampshire Republican, who is pushing many of the telecommunications and tech priorities of former Sen. George Allen, R-Va., is becoming a thorn in the side of Republican FCC Chairman Kevin Martin. In September, Sununu stalled Martin's re-nomination to the agency for a second term. At the time, the lawmaker was concerned about Martin's support of per-channel pricing for cable, among other issues.
E-Government: A House Democrat last week encouraged an appellate court in Florida to allow a political candidate who has challenged the results of her election to investigate the source code of the e-voting machines used Nov. 7. In a letter to the Florida 1st District Court of Appeal, House Administration Committee Chairwoman Juanita Millender-McDonald of California said the decision to block Democrat Christine Jennings from accessing the source code of the machines used in her 369-vote loss to Republican Vern Buchanan bears decisively on her central claim that the machines malfunctioned. Jennings has filed a suit demanding a new election in Florida's 13th District. She also has asked House Administration to intervene. The panel will consider the matter after the legal action in Florida. "I am particularly concerned that the public, in Florida and nationwide, have full confidence that the questions raised by this contest are resolved," Millender-McDonald wrote.
Education: On Monday's fifth anniversary of the education law known as the No Child Left Behind Act, Education Secretary Margaret Spellings celebrated the achievements of the bipartisan effort beside education and corporate leaders at the Chamber of Commerce. "With No Child Left Behind, we set the goal to have every student reading and doing math on grade level by 2014. And it's working," Spellings said. She cited gains in reading and math made by the fourth-graders in the 2005 national report card. The president and Congress have increased federal elementary and secondary education spending by 41 percent over the last five years. Separately, House Republicans shared optimism for continued bipartisan support in changing and reauthorizing the law this year. "We're finally making real progress in closing the achievement gap between disadvantaged students and their more affluent peers," said Howard (Buck) McKeon of California, the House Education and Labor Committee's senior Republican member.
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