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Intellectual Property
Judge Hints At Compromise To Keep Vonage Alive
by David Hatch
A federal appeals judge indicated Monday that a compromise may be needed to prevent the Vonage Internet telephone firm from going out of business due to a legal battle with Verizon Communications.
"Shouldn't that be a consideration in framing the injunction?" Judge Timothy Dyk asked during oral arguments in an intellectual property dispute involving the companies. He was referring to an injunction handed down in March by a U.S. district judge in Alexandria, Va., stating that Vonage had infringed on three Verizon patents.
New Jersey-based Vonage was ordered to pay $58 million, which has been placed in escrow pending the outcome of its appeal. The firm also must pay royalties totaling 5.5 percent of revenue derived from use of the patents, which enable customers to access calling features and allow Internet-delivered calls to connect to the larger telecom network and wireless handsets.
During Monday's proceedings before a three-judge panel of the Federal Circuit Court of Appeals, Dyk spoke his mind about Vonage's fate while Chief Judge Paul Michel and Judge Arthur Gajarsa remained silent on that issue.
Emphasizing that Verizon's primary interest is to gain customers and not put Vonage out of business, Dyk told the packed, standing-room only courtroom, "I'm just wondering if there's some middle ground." He further suggested that it might be advantageous for the lower court to give Vonage time to develop solutions that sidestep the patents.
But Richard Taranto, the attorney representing Verizon, responded that an "open deadline" should not be permitted because it would result in "continued harm" for his client.
Vonage has asserted publicly that Verizon is using the infringement allegations as cover for its real goal: to derail a competitor. In a recent interview, John Thorne, deputy general counsel at Verizon, insisted that his company only seeks to protect its intellectual property.
"We've attempted repeatedly to settle with them," he said, adding, "We wouldn't do that if we were trying to put them out of business."
The appeals court focused much of its attention on whether the district judge properly defined various technical terms related to Vonage's services and whether the judge properly explained the definitions to the jury.
Roger Warin, the attorney representing Vonage, told reporters that while the company thinks the injunction is unjustified because Verizon did not show "irrevocable harm," Vonage would accept a new trial. "We think the [lower court] trial judge committed errors ... by not defining two claim terms," he said, "We think that alone should result in a new trial."
Warin appeared open to Dyk's idea of seeking "middle ground" to give Vonage time to develop alternate solutions but lamented that Vonage still would have to pay the fine and royalties.
"The argument went well for us. I'm optimistic. I expect a decision to issue promptly," Thorne said.
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Broadband
Rhode Island Is Fastest State Online, But The U.S. Lags
by Michael Martinez
Rhode Islanders have access to the fastest Internet speeds in the country, but the connections are still seven times slower than those widely available in some other countries, according to a report released Monday.
A study compiled by the Communications Workers of America found that Rhode Island boasts the fastest download and upload speeds of all the states, but other countries have faster speeds thanks to more robust broadband infrastructures.
CWA recorded the speeds of nearly 80,000 people in all 50 states and the District of Columbia by allowing them to test their connections on its Speedmatters.org site. The group found that the median download speed in the United States was 1.9 megabits per second, which is about 30 times slower than the median speed in Japan.
Because so few people with dial-up connections participated in the test, CWA added that the actual median Internet speed in the United States is lower than the one it calculated.
Kansas, New Jersey, New York and Massachusetts rounded up CWA's top five for download speed. New Jersey and New York also were among the five fastest uploading states. Alaska ranked last for both downloading and uploading. The report found that files of similar sizes would take roughly 12 times longer to download in Alaska than in Rhode Island.
Despite scoring in the bottom half for download speed, the District of Columbia ranked second in the uploading category.
The slow speeds across the board when compared with other nations are limiting the ways Americans can use the Internet, CWA said. According to the report, most U.S. connections are too slow to run home-based businesses and medical monitoring or to facilitate distance learning.
CWA urged federal lawmakers to adopt a nationwide policy goal of building broadband infrastructure capable of downloading at 10 megabits per second by 2010. The report also advocated policies to ensure the equal treatment of content on broadband networks and recommended an overhaul of a federal program that subsidizes telecommunications services in rural and low-income areas.
"It is long past time to restore U.S. leadership in high-speed Internet policy," the report said. "The U.S. has a lot of ground to cover to remain competitive with other economies that have already adopted policies that will facilitate job growth, business advancement and individual achievement through access to the latest information technologies."
In a teleconference, CWA President Larry Cohen said the United States will not catch up to the rest of the world if it allows the deployment of broadband to be left to market forces. He said other countries have taken much more initiative and that it would be bad public policy for U.S. lawmakers to "wait and hope" for the country's broadband capability to improve.
"The rest of the world knows this," he said.
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Competitiveness
Council's Report Connects Competitiveness, Security
by Heather Greenfield
Since the 2001 terrorist attacks, the Council on Competitiveness has trumpeted the concept that security is an issue that affects U.S. competitiveness in the global market. It has encouraged policymakers to consider not just physical protection but also how to protect the U.S. economy by getting critical infrastructures running after disasters.
The council drove the point home Monday in a new economic report on integrating competitiveness and security. The report said the ability to "bounce back from disruption will be a competitive differentiator for companies and countries alike in the 21st century."
The report mentioned recent disasters, including the August 2003 power blackout in New York that cost more than $6 billion.
During a seminar where the report was released, business executives also talked about the increasing costs of cyber attacks and data breaches.
Thomas O'Neill, the principal at Sandler O'Neill, said his financial services firm was at nearly the top of the second tower of the World Trade Center and lost one-third of its employees during the 2001 attacks. He said many precautions taken after the 1993 attempt at blowing up the same building, including backing up all computer data, helped his firm continue operations days later.
O'Neill said his company was able to bounce back from that attack, but a data-security breach could put it out of business. He said his company constantly monitors for that and has a group that tries to break into its computers to get information.
Susan Bailey, vice president of global network operations planning at AT&T, said her company processes 10 quadrillion bytes of data every business day. With that amount of data, she said, "it's hard to imagine what threat AT&T doesn't worry about in some shape or form."
Bailey advised other businesses to focus not just on asset protection but functional resilience so they can continue to operate during and right after disasters.
The report looked at five years of analysis by private risk-management companies and the impact of new homeland security policies on business. It noted that with most of the infrastructure controlled by the private sector, industry must help craft a disaster-response strategy rather than have it imposed by government.
But the report does ask the federal government to play a role, too. It recommends that the government ask to see company resilience plans as part of the criteria for federal contacts. The report also asks the government to create regional "collaborative centers" outside the Washington Beltway to share information and intelligence in emergencies.
Some business executives questioned whether to make changes that could cost money or make an operation less efficient based on things that might happen. Others asked whether resilience is just the latest buzzword for common sense.
Dupont CEO Charles Holliday said his company often does invest in planning for events that never happen, but the exercises build fundamental skills that would help in a real disaster.
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Intellectual Property
Experts Ponder Libraries' Rights In The Digital Era
by Aliya Sternstein
Copyright battles between content creators and commercial Web sites are expected when money is at stake, but copyright spats get a little more confusing when the combatants are content creators and librarians.
"What would you do in a library if you didn't have anything to put in it?" Richard Rudick, a former senior vice president and general counsel of the John Wiley and Sons law firm, asked Monday at a Library of Congress event. "Why has the dialogue between the library communities and the content communities been so strained, and what can we do about it?"
A study group co-sponsored by the library and the Copyright Office and comprised of copyright experts from the library and publishing communities met to discuss copyright exceptions applicable to libraries and archives that may need to be amended in light of digital media.
By November, the study group expects to recommend possible alterations to Section 108 of the Copyright Act, which dictates the exemptions. With libraries now collecting items published only in digital form, so called born-digital works, librarians and publishers say the current rules do not adequately address many issues unique to new media.
Rudick, who is co-sponsor of the 19-member Section 108 Study Group, said, "The starting point for this exercise was preservation."
The present limit on certain digital copies that a library can preserve -- three items within the confines of the facility -- was drafted during the microfiche age, said study group member Robert Oakley, the director of the Georgetown University law library. "That three-copy limit simply doesn't work anymore" because we live in a networked society, he said.
Yet some newspapers, such as The New York Times, make money from the archives of their online editions.
"I don't think unlimited access to all Web sites is going to be" the option that works, said study group member Lois Wasoff, an attorney who specializes in copyright and trademark matters and was an executive at the publisher Houghton Mifflin, "but clearly a solution is needed."
Remote access to digital materials does not fit neatly into the copyright exemptions, either. Study group member John Schline, the corporate director of business affairs for Penguin Group USA, said that in physical libraries, "natural speed blocks" prevent library users from widely distributing copies of holdings. Patrons can only reproduce so many pages at once on a library photocopy machine, for instance.
Yet "if you have one digital copy that's posted somewhere," Schline said, "thousands can read it."
Library users present another complication for copyright holders. Wasoff remarked that in the networked environment of the Internet age, "your community can be the world."
Oakley said few libraries attempt to service the whole world. "The universe of material is limited and most of us do serve a limited community," he said. "But it is important to recognize that materials are accessed remotely" within that limited community of students, residents or other authorized patrons.
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Health
Would You Like A Health Reminder With That Burger?
by Aliya Sternstein
With unhealthy eating being blamed in part for rising healthcare costs, one company is out to combat the trend with food-service software that prints personalized nutritional information on customers' receipts.
The Nutricate receipt, created by a Santa Barbara, Calif., company of the same name, provides customized nutritional data like calories, fat and carbohydrates; percentage of recommended daily intake; and nutritional advice for the next purchase. A customer may see the following: "Did you know? If you hold the mayo on your sandwich, you'll save 180 calories and 8 grams of fat?"
The tool is designed for fast-food establishments where meals are prepared in a consistent manner. However, a chef could update the system on the fly if he adds a pinch of salt or a dash of sugar. The Internet-enabled technology behind the receipts allows restaurant operators to update recipes remotely.
Nutricate currently is installed in the Santa Barbara area's Silvergreens Restaurant and some locations of Extreme Pita in San Francisco. The company is working to get the receipts into healthcare facilities and workplace cafeterias, where poor diet is having "a huge implication" on health costs and job productivity, said Molly Chester, Nutricate's vice president for business development. The product debuted a couple months ago.
"At the end of the day, what we wanted to do was provide a way that gave consumers accurate information that was meaningful for them," she said. "We were trying to help them make healthy decisions, long term. It's not one meal that makes or breaks somebody's total diet."
The nutrient breakdowns also are intended to help consumers become more health literate, resolving "the math barrier" that requires calculating a meal's calories and fat based on obscure serving sizes.
But some nutritionists and consumer groups see problems with a system that distributes nutritional information after customers have paid -- not when they are deciding what to order.
Marion Nestle, a New York University nutrition professor, said the receipt "cannot help people to modify their behavior."
Margo Wootan, with the Center for Science in the Public Interest, said that "some information is better than no information," but it's really not that beneficial to get information after choosing.
The center believes that nutrition information should be listed as prominently as the price. "People would never dream of ordering without having the price right there. ... For a lot of people, nutrition is the same."
But Arlin Wasserman, executive director of America on the Move Foundation, who holds a master's degree in public health, said the receipt's feedback lets people make small changes that lead to better health behavior.
"America on the Move has found that the most effective way to make long-lasting changes to prevent obesity is to make small changes, gradually over time," he said. "Giving people very modest encouragement" so they can say, "'I've done a little better or I could do a little better next time,' is the right way to go."
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Net Governance
ICANN Weighs Policy For Domain Sellers That Fail
by Andrew Noyes
Protecting consumers from Internet registrars that do not meet their contractual obligations was a key topic at a Monday meeting of the Internet Corporation for Assigned Names and Numbers, which manages the Web-addressing system.
The discussion came after the collapse of RegisterFly, a New Jersey-based registrar that was stripped of its ICANN accreditation earlier this year for failing to respond to repeated customer complaints. Registrars help consumers purchase and retain Web addresses.
A federal judge in California issued an injunction against the firm in May, and the competitor GoDaddy took control of the accounts for hundreds of thousands of domains. ICANN promised to work toward creating a standard process to better protect registrants in the future.
The growth in numbers of registrars that resell domain endings like .com increase the likelihood of registrar failure, the group said. Plus, ICANN's outdated registrar accreditation agreement does not reflect recent changes in the market, officials acknowledged at the weeklong meeting in San Juan, Puerto Rico.
One proposal is storing client records and associated domains with a third party. Seven applications to provide such a service were received, and two are being considered. An agent could be selected by early next month.
Amending the existing accreditation agreement between ICANN and about 900 registrars also is an option. The contract has not been changed for more than seven years, and a plan to streamline the process and make contract reviews more routine is being considered.
Establishing a formal process for transferring domains if a registrar fails is on the agenda as well. In RegisterFly's case, GoDaddy's involvement was the result of private negotiations between the firms, but some observers think ICANN needs detailed rules for handling future incidents.
Vittorio Bertola, a non-voting liaison on ICANN's board, said the proposed plan is "entirely unacceptable." The dialogue focuses on registrars but must include input from domain buyers as well, he said.
Work on the escrow service should not be confused with the ongoing debate over privacy implications and the accuracy of "Whois" databases, which make webmasters' contact data publicly available, ICANN board member Susan Crawford said.
Under the current accreditation system, registrars must submit registrant administrative, technical and billing information to ICANN or an approved escrow agent. The question is whether they should have to provide additional details and how that is balanced with privacy interests, she said.
Registrants must decide which is more important, their total anonymity or having an escrow service store their information so their domains would be preserved during a disaster, said Wendy Seltzer, a fellow with the Berkman Center for Internet and Society at Harvard University.
While the ICANN board is not expected to make any major decisions in San Juan, several subjects are ripe for debate. Among them are progress on a policy to introduce domain suffixes and an update on the testing process for introducing domains in foreign-language characters, ICANN President Paul Twomey told reporters during a teleconference.
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On The Download
Why Candidates Use YouTube Despite Its Weaknesses
by Shira Toeplitz
For months it seemed like campaigns had trouble thinking outside the online video box, otherwise known as the standard YouTube player. The video-sharing site is still the most popular of its kind today, but some political campaigns are slowly discovering that it's not always the best platform for their purposes.
While YouTube certainly reaches the most users, some political video experts complain about the viewing quality. Campaigns have opted to use other video services on their sites in addition to YouTube, such as Brightcove, blip.tv and Veoh.
Ben Homer, an editor at the blog Online Video Watch, knows the ups and downs of all of the video-sharing sites. "Their quality is pretty bad," Homer said of YouTube. "But for all intents and purposes, everything is embeddable so you can put it anywhere."
Tim Tagaris, the Internet director for the presidential campaign of Sen. Christopher Dodd, D-Conn., said it is rare to find a major presidential campaign these days that only posts to YouTube. But he added that the major benefit to YouTube is its easy-to-use platform.
"The upside is that's where the most people are and that is probably the platform most people are familiar with," Tagaris said. "If my mother were to get an e-mail, she would understand how to use YouTube, where as another platform might confuse her a little bit."
Some experts interviewed also said YouTube has done a great job of reaching out to campaigns in recent months, including sponsoring two planned presidential debates in July and September that will feature user-submitted videos. The publicity might be in part due to YouTube's huge Web audience and the keen ability of its parent company, Google, to get press for its outreach efforts.
"If it's on YouTube, people are going to see it," one Internet campaign operative said. "The cons are it's pretty low quality, so if you do something with high production values, it just doesn't translate as well, or as clearly, on YouTube."
While all of the presidential campaigns post videos to YouTube's news and politics page, most of them also are trying different players on their Web sites. John McCain uses Veoh, while Rudy Giuliani, Barack Obama, Mitt Romney and others are using Brightcove. Others, including Dodd, use blip.tv.
In terms of video quality, Homer ranked Brightcove highest and YouTube lowest. But despite the discrepancy in quality, Homer said he would never search for political videos at Brightcove -- and his habits are likely the norm. While most of these online video players have searchable directories, many specialize in marketing their platforms as custom-made players for Web sites with a sleeker designs and more detailed analytics packages.
Josh Hawkins, a senior marketing manager at Brightcove, called his company's video platform more of a tool for campaigns "to build communities around their Web sites," as opposed to YouTube, which he said is more of a community within itself online. "We really view YouTube as a social network rather than an enterprise platform," Hawkins said.
But YouTube is and likely will remain the staple for online video in the upcoming cycle. In the simplest terms, the positives (popularity and embeddable format) outweigh its biggest con (low visual quality).
And above all, there's the wait time. In a rapid-response world moving at the bitrate of light, sometimes there's not always enough time to wait a few hours for a high-quality video to upload. YouTube videos can be uploaded and circulated quickly.
For example, when a 1994 tape surfaced earlier this year showing Republican Mitt Romney debating his abortion-rights position against Sen. Edward Kennedy, D-Mass., the campaign quickly retaliated with a low-tech video of Romney calling a conservative Internet radio show to explain his views and his recent change of heart on the issue.
In the old-school campaign world of television ads, political operatives had a few days to respond. But in the school of new media, sometimes even a few hours is too long to get ahead of a story.
Editor's Note: On The Download is Hotline's dispatch on politics, multimedia and the Internet.
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Today's Feature:
Issue of the Week
The concept of a one-stop online shop for college textbooks, where the titles are cheap and the profits are plenty, may sound like a far-off fantasy, but at least one major university is working on fulfilling that dream.
Every Monday, read the Issue of the Week by the Technology Daily staff.
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Editor in Chief -- Louis Peck, 202-739-8481
Editor -- K. Daniel Glover (bio)
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Senior Writers -- David Hatch (bio), Heather Greenfield (bio), Andrew Noyes (bio) and Aliya Sternstein (bio)
Special Correspondent -- Chris Strohm (bio)
Staff Writer -- Michael Martinez
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