House Passes Bill to Delay INTELSAT IPO

5/5. The House passed S 2315 by unanimous consent without debate. This is a short and untitled bill to amend the Open-Market Reorganization for the Betterment of International Telecommunications (ORBIT) Act to extend the deadline for INTELSAT's initial public offering (IPO) from June 30, 2004 to December 31, 2005.

Sen. Conrad Burns (R-MT) introduced this bill on April 8, 2004. See, story titled "Sen. Burns Introduces Bill to Allow Delay in INTELSAT IPO" in TLJ Daily E-Mail Alert No. 874, April 12, 2004. The Senate passed this bill on April 27. See, story titled "Senate Passes Bill Allowing Delay in INTELSAT IPO" in TLJ Daily E-Mail Alert No. 887, April 29, 2004.

FCC Forms Wireless Broadband Access Task Force

5/5. The Federal Communications Commission (FCC) Chairman Michael Powell formed a Wireless Broadband Access Task Force. The FCC stated in a release [PDF] that its purpose is "to identify potential changes in wireless broadband policies that will further facilitate the deployment of wireless broadband services".

The initial co-chairs are Lauren Van Wazer of the FCC's Office of Engineering and Technology (OET), and John Branscome of the Wireless Telecommunications Bureau (WTB). The other initial members are Erin Boone (Office of Strategic Planning and Policy Analysis), Leon Jackler (Consumer and Governmental Affairs Bureau), Paul Nagle (Office of Legislative Affairs), and Meribeth McCarrick (Office of Media Relations).

FCC Chairman Powell (at right) stated that "I have asked this Task Force to study existing wireless broadband polices and make recommendations for possible improvements to promote the growth of both licensed and unlicensed wireless broadband services. The overarching goal of this initiative is to take a hard look at what we can do to extend the reach of broadband services to underserved areas and to provide increased competition in areas that already have access to broadband."

The FCC also issued a request for comments [PDF]. This document is titled "Public Notice" and numbered "DA 04-1266". Neither this public notice, nor the release, state that either the formation of the task force, or the issuance of this request for comments, are decisions of the five member Commission.

Initial comments are due by June 3, 2004. Reply comments are due by July 1, 2004.

The request poses 12 questions, each of which has multiple parts.

For example, the request asks "To what extent are both licensed and unlicensed wireless broadband networks providing an alternative facilities-based platform to other broadband services, including cable and DSL? To what extent have wireless broadband service providers increased broadband access and competition in rural and underserved areas? If so, are regulatory changes needed to promote or advance these trends?"

It also asks "Does the Commission currently provide sufficient spectrum suitable for wireless broadband networks?" and "Has the method for access to spectrum affected the development of wireless technologies and the provisioning of wireless broadband services?"

EIA Releases Tech Policy Recommendations

5/5. The Electronic Industry Alliance (EIA) released a report [66 pages in PDF] titled "The Technology Industry at an Innovation Crossroads: A Policy Playbook Addressing the Future of the U.S. High-Tech Innovation Economy"

The is a collection of policy proposals pertaining to technology, with discussion and explanation. It is organized in a long glossy booklet, with pictures, graphs, tables and intricate formatting.

Dave McCurdy, President of the EIA, presented the report at an event in the Capitol Building on May 5. He was joined by representatives of several of the member groups of the EIA, including Matthew Flanigan, President of the Telecommunications Industry Association (TIA).

Rep. Adam Smith (D-WA) also spoke at the event. He stated that "this blueprint is about as good a summary as I have seen". Rep. Smith also argued that the U.S. should not give in to the "protectionist approach".

Rep. Sherwood Boehlert (R-NY) did not attend, but issued a statement. He wrote that the "EIA has put out an important report that should guide Congress as we work to strengthen the U.S. economy for both the short- and long-term. While I cannot endorse every recommendation, the overall report targets exactly the right issues for Congress to address."

Trade. The report addresses a wide range of technology related trade issues.

For example, it states that "Our biggest concern is not offshore outsourcing, but that demagoguery and political overreaction to this business practice -- which, by the way, is not new -- will lead to protectionist policies. The lack of an overarching vision, combined with inadequate investment in innovation, contributes to short-term and false choices that could potentially lead to the critics’ prophecies of inevitable Chinese or Indian economic dominance. The core value of a knowledge-based company or society should be innovation, which at its heart is creativity plus risk-taking."

It adds that "Policies designed to directly block offshore outsourcing or to penalize companies for doing business in their international sales markets will only encourage our trading partners to retaliate with similar initiatives. This sort of activity is counterproductive and will harm consumers, employees and entire economies in the end."

Dave McCurdy and Sen. Joe Lieberman (D-CT) will speak at a New America Foundation (NAF) event titled "Solving the Offshore Outsourcing Challenge: A Proposal by Senator Lieberman" on Tuesday, May 11.

The report also recommends that the U.S. should be more aggressive in its use of the World Trade Organization (WTO) legal system. It also recommends the the U.S. "Use Section 301 wherever it may be consistent with U.S., WTO and other international obligations. USTR’s use of Section 301 can serve to highlight unfair foreign trade practices and put pressure on foreign governments to eliminate these practices."

It adds that the U.S. should "Give special attention to compliance problems with China. China is a new WTO member and many have been willing to allow the country time to fulfill its WTO responsibilities. Now, however, China has enjoyed a reasonable grace period. For the electronics industry, Chinese policies pose significant challenges on several fronts, including taxation of semiconductors, standard setting and intellectual property protection."

The report also recommends "more aggressive enforcement of IP protection by U.S. trading partners. Patent and copyright enforcement must be a high priority for the U.S., and where government officials – starting with the President and the U.S. Trade Representative -- push for enforcement, trading partners are more likely to cooperate. In addition, the International Trade Commission should use Section 337, when appropriate."

Immigration. The EIA report also addresses immigration issues. The report defends the H1B and L1 visa programs. "The H1-B classification applies to workers in a specialty occupation that requires highly specialized knowledge and a high level of training and education. The L-1 classification allows foreign nationals to transfer to the U.S. affiliate of the corporation for which they work." The report adds that "it is imperative that legislators not lose sight of the value provided by temporary workers and not disrupt the ability of companies to use these visa programs for legitimate purposes."

The report then lists numerous recommendations for reforming, but maintaining, these programs. It recommends more funding and resources for the agencies involved in administering these programs, clarifying the definition of "specialized knowledge" for the purpose of issuing L1 visas, and exempting from the H1B caps foreign graduates of masters and Ph.D. programs at U.S. universities.

Taxation. The report also includes recommendations on several technology related tax issues.

It recommends that there be a physical nexus requirement for states to impose a business activity tax (BAT). This is the subject of HR 3220, the "Business Activity Tax Simplification Act of 2003", sponsored by Rep. Bob Goodlatte (R-VA), Rep. Rick Boucher (D-VA), and others. The House Judiciary Committee's Subcommittee on Commercial and Administrative Law is scheduled to hold a hearing on this bill on Thursday, May 13.

It also recommends "tax credits or expensing to encourage broadband providers to extend and upgrade their networks.

But notably, the report is silent on S 150 and HR 49, the Internet Non-discrimination Act. See, story titled "Senate Passes Weakened Version Internet Non-discrimination Act" in TLJ Daily E-Mail Alert No. 889, May 3, 2004.

Research & Development. The report contains many recommendations pertaining to research and development (R&D). It recommends making the R&D tax credit permanent, providing more government funding for basic research, and more funding for the National Institute of Standards and Technology (NIST).

Education & Training. The report also contains lengthy sections on K-12 math and science education and on workforce assistance and training.

House Judiciary Committee Puts Off Mark Up of Tech Related Bills

5/5. The House Judiciary Committee held a meeting to mark up various bills and resolutions. It did not reach any of the technology related bills. The Committee has not yet scheduled its next mark up session.

The Committee reported unfavorably HJRes 83, a resolution proposing an amendment to the Constitution regarding the appointment of individuals to fill vacancies in the House of Representatives. This is also known as the Baird amendment.

The Committee also began its consideration of HR 2934, the "Terrorist Penalties Enhancement Act of 2003".

The Committee thus postponed its mark up of several technology bills. These include HR 3632, the "Anti-counterfeiting Amendments of 2003",  HR 3754, the "Fraudulent Online Identity Sanctions Act", and HR 338  the "Defense of Privacy Act". The Committee could mark up these bills as early as next week.

Anti-counterfeiting Amendments of 2003. Rep. Lamar Smith (R-TX) introduced this bill, HR 3632, on November 21, 2003. It would revise and expand 18 U.S.C. § 2318, which pertains to trafficking in counterfeit labels, documentation and packaging of computer programs, phonorecords, and movies. See, story titled "Rep. Smith Introduces Bill to Strengthen Ban on Counterfeit Labeling of Software, Movies and Music" in TLJ Daily E-Mail Alert No. 787, November 26, 2003.

The bill contains numerous changes. For example, the bill would expand the scope of activities encompassed by counterfeit labeling to include such things as using genuine labels with an item for which they were not intended, and altering the number of authorized users of computer programs.

The Subcommittee on Courts, the Internet and Intellectual Property amended and approved this bill on March 31, 2004.

Fraudulent Online Identity Sanctions Act. Rep. Lamar Smith (R-TX) and Rep. Howard Berman (D-CA), the Chairman and ranking Democrat on the Subcommittee on Courts, the Internet and Intellectual Property, introduced this bill on February 3, 2004. See, story titled "Representatives Introduce Bill to Deter Domain Name Fraud" and "House Subcommittee Holds Hearing on False Domain Name Registration Data" in TLJ Daily E-Mail Alert No. 830, February 5, 2004.

This bill, HR 3754, addresses the registration of domain names with false information. Law enforcement authorities use the Whois database or registration information to identify and locate people who use web sites in connection with crimes. False registration information makes identifying the perpetrators more difficult. False registration information also makes it harder for trademark holders to pursue cybersquatters. It also makes it harder for copyrights holders and manufacturers to locate online infringers and online sellers of counterfeit goods.

This bill creates no new civil or criminal prohibition of registering a domain name with false information. Nor does it impose any requirements upon domain name registrars to verify domain name registration information, to refuse to register domain names when it knows that the registration information is false, or to cancel registrations made with false registration information.

It adds new civil remedies and criminal penalties for violation of existing statutes, where the violation also involves registering a domain name with false information. For example, it amends the Copyright Act to provide that, for the purpose of calculating statutory damages for infringement, the infringement shall be considered willful if the infringement also involves registering a domain name with false information.

This bill has been criticized by the ACLU, Public Knowledge and other groups. See also, story titled "Groups Oppose Fraudulent Online Identity Sanctions Act" in TLJ Daily E-Mail Alert No. 891, May 5, 2004.

Defense of Privacy Act. Rep. Steve Chabot (R-IN) introduced this bill, HR 338, on January 27, 2003. This bill would amend Title 5 to require that when federal agencies promulgate rules, that they take into consideration the impact of such rules on the privacy of individuals. See, story titled "Rep. Chabot Introduces Federal Agency Privacy Bill" in TLJ Daily E-Mail Alert No. 596, February 3, 2004.

This is a reintroduction of HR 4561, the Federal Agency Protection of Privacy Act, which was sponsored by former Rep. Bob Barr (R-GA) in the 107th Congress. It passed in the House Judiciary Committee on September 10, 2002, and the full House on October 7, 2002, under suspension of the rules. The companion bill in the Senate, S 2492, was sponsored by former Sen. Max Cleland (D-GA). It saw no action. See also, story titled "House Subcommittee Holds Hearing on Federal Agency Privacy" in TLJ Daily E-Mail Alert No. 423, May 2, 2002.

The House Judiciary Committee's Subcommittee on Commercial and Administrative Law, and Subcommittee on the Constitution held a hearing on HR 338 on July 22, 2003. See, opening statement of Rep. Chris Cannon (R-UT), opening statement of Rep. Steve Chabot (R-OH), and prepared testimony of Sen. Charles Grassley (R-IA). See also, prepared testimony of Bob Barr (American Conservative Union), prepared testimony of Jim Dempsey (Center for Democracy & Technology), and prepared testimony of Laura Murphy (American Civil Liberties Union).

Other Bills. The Committee may also mark up HR 1302, the "Federal Courts Improvement Act of 2003". This is a large bill containing diverse provisions. One provision, found in Section 104, would change the way federal judges report to the Administrative Office of the United States Courts regarding wiretap orders.

The Committee may also mark up HR 1731, the "Identity Theft Penalty Enhancement Act". This bill pertains to penalties for "aggravated identity theft", including identity theft that is associated with terrorism crimes and certain enumerated felonies.

The Committee may also mark up S 1301, the "Video Voyeurism Prevention Act of 2003". This bill has already passed the Senate. It would criminalize video voyeurism. This crime is defined with language, which, if quoted in this issue of the TLJ Daily E-Mail Alert, would cause the mail servers of some subscribers to block delivery of this issue.

Rambus Files Antitrust Suit Against Micron, Hynix, Siemen & Infineon

5/5. Rambus filed a complaint [38 page PDF scan] in state court in California against Micron, Hynix, Siemens and Infineon alleging violation of California antitrust law, intentional interference with prospective economic advantage, and unfair competition, in connection with alleged efforts to eliminate competition and stifle innovation in the market for dynamic random access memory (DRAM) chips.

The complaint states that "This case involves concerted and unlawful efforts by a group of the largest semiconductor manufacturers in the world to eliminate competition and stifle innovation in the market for computer memory technology and computer memory chips."

It alleges that the defendants "who collectively wield substantial power in the global market for computer memory technology and chips, combined and conspired in violation of the antitrust laws to boycott Plaintiff Rambus, Inc. ("Rambus") and its memory technology, and to restrict the production of, and raise the price for, Rambus-designed memory chips. Defendants did so in an effort to promote the industry-wide adoption of an alternative to Rambus's memory chip design, an alternative that they believed would be more profitable to Defendants, and to drive Rambus-designed chips out of the computer memory market."

The complaint alleges conspiracy to restrict output and fix prices in violation of the Cartwright Act (California Business and Professional Code §§ 16720, et seq.), conspiracy to monopolize in violation of the Cartwright Act, intentional interference with prospective economic advantage, and unfair competition (Bus. & Prof. Code §§ 17200, et seq.)

Rambus seeks treble damages, punitive and exemplary damages, and injunctive relief. See also, Rambus release.

Micron's Dave Parker stated in a release that "Rambus failed in the marketplace because of excessive manufacturing costs and minimal RDRAM demand. Several memory manufacturers, including the world's largest, continue to produce RDRAM products sufficient to meet its limited, worldwide market demand. It is unfortunate that Rambus is trying to blame the market failure of its RDRAM technology on others, like Micron, who ultimately responded to marketplace demands."

He added that "We believe Rambus is attempting to deflect attention away from the Federal Trade Commission's (FTC) ongoing suit against Rambus for alleged antitrust violations".

This case is Rambus Inc. v. Micron Technology, Inc., Micro Semiconductor Products, Inc., Hynix Semiconductor America, Inc., Siemens AG, Siemens Corporation, Infineon Technologies AG, Infineon Technologies North America Corporation, and Does 1 through 50, Superior Court of the State of California, County of San Francisco, Case No. 04-431105.

People and Appointments

5/5. Howard Buskirk joined Communications Daily. He previously worked at Telecommunications Reports. He replaces Mary Greczyn, who was named Executive Director of Freedom Technologies, Janice Obuchowski's telecommunications consulting firm.

5/5. The National Cable & Telecommunications Association (NCTA) re-elected members of its Board of Directors. Glenn Britt, Ch/CEO of Time Warner Cable, was re-elected for a one-year term as Chairman of the Board of Directors. Brian Roberts, P/CEO of Comcast, was re-elected Vice Chairman. Tom Rutledge, COO of Cablevision Systems Corporation was re-elected as Secretary. Nickolas Davatzes, P/CEO of A&E Television Networks, was re-elected as Treasurer. The NCTA also re-appointed members of its Executive Committee. See, NCTA release.

5/5. Fran Dougherty was named Chief Operating Officer (COO) for 4thpass, a subsidiary of Motorola, that makes secure device and content management software for wireless operators. See, Motorola release.

More News

5/5. The House passed HR 4227, the "Middle-Class Alternative Minimum Tax Relief Act of 2004", by a vote of 333-89. See, Roll Call No. 144.

5/5. President Bush gave a speech in Washington DC. He stated that "In order to make sure we grow and people can find work, this country must be confident about our ability to compete in the world. We need to knock down trade barriers. We need to open up new markets around the world for America's entrepreneurs and farmers and ranchers. Empty talk about jobs and economic isolationism will not get anyone hired. The way to create jobs is to reelect a pro-growth, pro-small business, pro-entrepreneur President, George W. Bush."

5/5. Twenty executives of television programming companies wrote a letter [3 pages in PDF] to members of Congress urging the Congress "to oppose legislative proposals to require cable and satellite providers to offer programming on an a la carte basis or dictate the terms of private contracts between program networks and multichannel video distributors, including terms regarding the packaging and marketing of programming." The signatories, which include representatives of the National Geographic Channel, Disney, MTV, VH1, BET, and A&E, are all women. The letter further implies that gender is relevant to this policy debate. The letter further argues that "Government efforts to dictate how our programming is packaged or marketed would be bad for consumers because it would give them less choice and less diversity in programming, and it would increase the price they would pay for this inferior set of offerings."

5/5. The Executive Office of the President's (EOP) Office of Management and Budget (OMB) published a notice in the Federal Register that contains, and requests comments on, a draft report of it Small Business Paperwork Relief Act Task Force. This draft report makes recommendations concerning the improvement of electronic dissemination of information collected under federal requirements. It also contains a plan to develop an interactive government wide internet program to identify applicable collections and facilitate compliance. Comments are due by June 4, 2004. See, Federal Register, May 5, 2004, Vol. 69, No. 87, at Pages 25147 - 25157.

5/5. Rep. Maurice Hinchey (D-NY) introduced HR 4286, the "Andrew Carnegie Libraries for Lifelong Learning Act", a bill to authorize the appropriation of $200,000,000 to provide grants to states for the "technology enhancement of public libraries". It states that technology enhancement means providing "access to information in electronic and other formats made possible by new information and communications technologies". This bill was referred to the House Committee on Education and the Workforce.

Bush Continues To Address Broadband in Campaign Speeches

5/4. President Bush continues to give speeches in which he advocates widespread deployment of broadband technologies. He made a campaign trip to the state of Ohio on Tuesday, May 4.

He gave a speech at a breakfast in Maumee, Ohio in which he said that "In order to make sure people are able to find work and America is the leading country in the world when it comes to economic growth, we need to promote an innovation society. We need to make sure we're on the leading edge of innovation. I'm a strong supporter in research and development. I believe there ought to be broadband technology in every home by the year 2007. And shortly thereafter, there ought to competing services so you get a better price and better quality. Broadband technology is going to be one of the important parts about changing America and to make sure we're on the leading edge."

Then, he gave a speech in Dayton, Ohio in which he said that "Government must put good policy in place that encourages the spread of innovative technology. My dream is for everybody in America to have broadband technology in their home by the year 2007. This is -- broadband technology, if done right, is going to revolutionize education and health care. It will make this society more entrepreneurial, make the people of America more productive."

He added that "We had a good break. The Senate passed a moratorium on access taxes to broadband. My view is there ought to be not any taxes on broadband. If you want it to spread across the country, don't tax it."

On Thursday, April 29 the Senate passed an amended version of S 150, the "Internet Tax Non-discrimination Act of 2003". See, text of bill as enacted by the Senate. See also, story titled "Senate Passes Weakened Version Internet Non-discrimination Act" in TLJ Daily E-Mail Alert No. 889, May 3, 2004.

Finally, Bush stated, "Plus we got to get rid of regulatory hurdles so that it spreads around. Innovative society -- an innovative society is one that's necessary for us to compete, but there are -- there are problems with an innovative society."

Senate Commerce Committee Holds Hearing on Extending SHVIA

5/4. The Senate Commerce Committee held a hearing on reauthorization of the Satellite Home Viewers Improvement Act of 1999.

Sen. John McCain (R-AZ), the Chairman of the Committee, wrote in his opening statement the SHVIA did not go "far enough in promoting regulatory parity and encouraging the growth of satellite delivered television programming against the entrenched cable monopoly. As we now look to reauthorize SHVIA, I believe we must keep the goal of real regulatory parity in mind."

He continued that "This time around Congress must ensure satellite operators have the right tools to bring robust competition to the video subscription market, which will lead to more programming options and lower prices for consumers. Additionally, Congress must review SHVIA in light of the looming transition to digital television and ensure that cable and satellite operators can provide consumers with outstanding high definition digital television content to facilitate this transition."

Sen. Ernest Hollings (D-SC), the ranking Democrat on the Committee, wrote in his opening statement that "it is my hope we will be able to move quickly in a bipartisan fashion to extend expiring provisions. I hope we can make other changes to serve the public interest, specifically preserving consumer access to community-oriented programming and providing satellite operators with proper incentives to expand their current offering of local broadcast channels in a non-discriminatory manner to all 210 television markets."

See also, prepared testimony of witnesses: Charlie Ergen (Ch/CEO of Echostar), Jim Yager (CEO of Barrington Broadcasting Company), Eddy Hartenstein (Ch/CEO of DirecTV), Araceli De Leon (Telemundo Communications), and Gigi Sohn [PDF] (Public Knowledge).

Groups Oppose Fraudulent Online Identity Sanctions Act

5/4. The American Civil Liberties Union (ACLU) and other groups sent a letter [2 pages in PDF] to the Rep. James Sensenbrenner (R-WI) and Rep. John Conyers (D-MI), asking that the House Judiciary Committee delay its markup of HR 3754, the "Fraudulent Online Identity Sanctions Act". The Committee has scheduled a meeting to mark up several bills, including HR 3754, on Wednesday, May 5 at 10:00 AM.

Rep. Sensenbrenner is the Chairman of the Committee. Rep. Conyers is the ranking Democrat on the Committee.

The five signatories are groups with a history, to varying degrees, of supporting lessened legal protection of intellectual property. They are the American Civil Liberties Union (ACLU), American Library Association (ALA), Center for Democracy and Technology (CDT), Electronic Frontier Foundation (EFF), and Public Knowledge.

The letter states that "The WHOIS database requires that individual Internet users, when they register domain names, make their names, home addresses, home phone numbers, and home e-mail addresses available to the world, with no privacy protections. Users covered by this requirement include human rights activists, corporate whistleblowers seeking to avoid retribution, and ordinary Americans seeking to avoid spam, stalking, or identity theft. As long as WHOIS lacks safeguards to protect their privacy and security these users will feel compelled to place inaccurate data in the database for reasons that have nothing to do with furtherance of illegal activity."

Summary of HR 3754. Rep. Lamar Smith (R-TX) and Rep. Howard Berman (D-CA), the Chairman and ranking Democrat on the Subcommittee on Courts, the Internet and Intellectual Property, introduced this bill on February 3, 2004.

It addresses the registration of domain names with false information. For example, law enforcement authorities use the Whois database to identify and locate people who use web sites to commit crimes. False registration information makes identifying the fraud artists more difficult.

False registration information also makes it harder for trademark holders to pursue cybersquatters who register domain names that infringe their trademarks. False registration information also makes it harder for copyrights holders and manufacturers to locate online infringers and online sellers of counterfeit goods.

The bill as introduced creates no new civil or criminal prohibition of registering a domain name with false information. Nor does it impose any requirements upon domain name registrars to verify domain name registration information, to refuse to register domain names when it knows that the registration information is false, or to cancel registrations made with false registration information.

Rather, the bill adds new civil remedies and criminal penalties for violation of existing statutes, where the violation also involves registering a domain name with false information. For example, it amends the Copyright Act to provide that, for the purpose of calculating statutory damages for infringement, the infringement shall be considered willful if the infringement also involves registering a domain name with false information.

See, story titled "Representatives Introduce Bill to Deter Domain Name Fraud" and "House Subcommittee Holds Hearing on False Domain Name Registration Data" in TLJ Daily E-Mail Alert No. 830, February 5, 2004.

Summary of ACLU Letter. The letter of the ACLU and others argues that the changes proposed by the bill "would chill speech online".

It provides two examples. First, "an online activist or whistleblower accused of infringing a trademark in the course of criticizing a company would be subject only to an injunction. Under HR 3754, he or she would face substantial monetary penalties, including all plaintiff’s attorney's fees."

The letter does not name any actual cases in which intellectual property laws were used to suppress web publication of copyrighted materials or registered trademarks. However, it could have cited Ford Motor Company v. Robert Lane d/b/a Warner Publications, U.S. District Court for the Eastern District of Michigan, D.C. No. 99-74205. See, District Court opinion.

The letter might also have cited Intellectual Reserve, Inc. v. Utah Lighthouse Ministry, Inc., Jerald Tanner, Sandra Tanner, et al., U.S. District Court for the District of Utah, Case No. 2:99-CV-808C. See, TLJ case summary and preliminary injunction order. However, in neither of these cases did the website publishers seek to conceal their identity.

Second, the letter states that "the author of an anonymous web log who innocently quotes a portion of a news article that a judge later decides to be too long to qualify for ``fair use´´ protection would be considered an ``innocent infringer´´ and subject to reduced statutory damages. Under H.R. 3754, the same ``blogger´´ would face damages up to $150,000 and potential criminal liability."

The letter concludes that "Domain name holders who submit inaccurate WHOIS data: 1) on the basis of bona fide concerns with privacy, or 2) to protect their legitimate rights to anonymous free speech, should not be branded criminals. Time is needed to address these serious concerns, which have not yet received adequate consideration. The undersigned groups ask that HR 3754 be held pending a further hearing or deliberation on its potential unintended consequences for privacy and speech online." (Emphasis in original.)

The letter does not contain any recommendations regarding how the bill might be amended to address any of the concerns raised in the letter.

Judge Posner. Use of intellectual property laws to suppress corporate criticism or whistleblowing often involves asserting copyright in unpublished documents that are not intended for publication. The plaintiffs alleged such in both the Ford and Intellectual Reserve cases.

Currently, the courts extend full copyright protection to unpublished works not intended for publication. See, Salinger v. Random House, 811 F.2d 90 (2nd Cir. 1989) and New Age Publications v. Henry Holt, 873 F.2d 576 (2nd Cir. 1989).

Judge Richard Posner of the U.S. Court of Appeals (7thCir) recently wrote that these cases were incorrectly decided, and that extending such protection suppresses truthful information that is relevant to matters of public interest. See, Landes and Posner, The Economic Structure of Intellectual Property Law, at Chapter 5.

Posner and Landes do not go on to address domain name registrations in this context. Nevertheless, if the courts, or the Congress, were to follow the recommendation that copyright protection not extend to unpublished works not intended for publication, or if the fair use defense in this situation were enhanced, then corporate critics who obtain and publish corporate documents online would have much less to fear from providing accurate information when registering their domain names.

Disclosure. Readers may want to assess the objectivity of any TLJ story about HR 3754 or domain name fraud. Online con artists have sent spam e-mail that has falsely implied affiliation with TLJ and/or listed TLJ as the place to send messages opting out of receiving further spam. In each case investigated by TLJ, the domain listed in the from line of the spam message was registered by the perpetrator with false information.

People and Appointments

5/4. SBC Communications named Randall Stephenson Chief Operating Officer. In addition, SBC named Rick Lindner Chief Financial Officer (CFO). He was previously CFO of Cingular Wireless, of which SBC is the part owner. See, SBC release.

More News

5/4. The Department of Justice (DOJ) published in its web site its complaint against Bill Gates alleging violation of the Hart-Scott-Rodino Act of 1976 in connection with his purchase of securities in the ICOS Corporation, a drug company based in Washington state. The DOJ also published its Motion for Entry of Judgment and a Stipulation.

5/4. The U.S. Court of Appeals (DCCir) issued its opinion [15 pages in PDF] in AT&T Wireless v. FCC, a case involving an aircraft based analog cellular telephone system. In a 2001 opinion, AT&T Wireless Services v. FCC, also reported at 270 F.3d 959, the Court of Appeals denied all challenges except one to an order of the Federal Communications Commission (FCC) granting AirCell, Inc. a waiver to operate an aircraft based analog cellular telephone system. The Court remanded to the FCC for an explanation of its conclusion that AirCell’s system was unlikely to harmfully interfere with the rights of ground based cellular telephone providers. The FCC then issued an order on remand, which is reported at 18 F.C.C.R. 1926 (2003). AT&T Wireless, Cingular Wireless, and CellCo Partnership petitioned for review of the order on remand, arguing that the FCC's explanation deviates from the reasoning in the initial order, and is unreasonable. The Court of Appeals denied the petition. It held that "the petitioners misinterpret the Commission’s initial order and the breadth of the remand in AirCell I, that they have waived several of their challenges to the Remand Order by failing to seek rehearing by the Commission of its explanation on remand, and that their unwaived challenges are unpersuasive." This case is AT&T Wireless, et al. v. FCC and USA, AirCell, intervenor, U.S. Court of Appeals for the District of Columbia, App. Ct. No. 03-1043, a petition for review of a final order of the FCC.

5/4. Sen. Daniel Inouye (D-HI) introduced S 2382, the "Native American Connectivity Act". The bill states that one of its purposes is "to promote affordable and universal access among Indian tribal governments, tribal entities, and Indian households to telecommunications and information technology in Indian country". It would create at the Department of Commerce's National Telecommunications and Information Administration (NTIA) a telecommunications block grant program, and authorize the appropriation of $20,000,000 per year. The bill was referred to the Senate Committee on Indian Affairs.

ACCF Predicts TRO and Opinion in USTA v FCC Will Increase Capital Spending, GDP and Employment

5/4. The American Council for Capital Formation (ACCF) released a short study titled "Macroeconomic Effects of Telecommunications Deregulation".

This study states that it examines "the macroeconomic effects of changes in the regulatory environment for the telecommunications industry and telecommunications firms due to the Federal Communications Commission (FCC) Triennial Review (February 2003) and a D.C. Appeals Court decision early this year (March 2004), which vacated portions of the Triennial Review."

The FCC released its triennial review order [576 pages in PDF] on August 21, 2003. See, story titled "Summary of FCC Triennial Review Order" in TLJ Daily E-Mail Alert No. 725, August 25, 2003. See also, stories titled "FCC Announces UNE Report and Order", "FCC Order Offers Broadband Regulatory Relief", "FCC Announces Decision on Switching", "Commentary: Republicans Split On FCC UNE Order", and "Congressional Reaction To FCC UNE Order" in TLJ Daily E-Mail Alert No. 609, February 21, 2003.

The U.S. Court of Appeals (DCCir) issued its opinion [62 pages in PDF] in USTA v. FCC, overturning key parts of the FCC's TRO on March 2, 2004. See, story titled "Appeals Court Overturns Key Provisions of FCC Triennial Review Order" in TLJ Daily E-Mail Alert No. 848, March 3, 2004.

The ACCF study further states that it reviewed "the potential impacts of changes in the economic behavior of the Bell companies and Competitive Local Exchange Carriers (CLECs) and how these changes could impact on real economic growth, capital spending, jobs, disposable income, consumer spending, profits, and the federal budget."

It argues that "The primary impact on the economy from the changed regulatory environment will likely be from investment decisions made by both the Regional Bell Operating Companies (RBOCs) (which no longer have to share future investments at a highly subsidized rate) and by the CLECs (which need to decide whether to buy or lease networks at commercial rates). Another sizable contribution will come from decisions by telcom providers and consumers to offer and adopt Digital Subscriber Line (DSL) broadband sooner than would have happened without the rulings, and to invest in newer computers, routers, and other gear." (Parentheses in original.)

The study predicts that the effect of the TRO and Court opinion will be "real GDP higher by an average 0.2 percent in 2006 and 2007 or $14.8 billion, annually." The study also predicts that capital spending will be "up an average $6.8 billion annually over 2004 to 2008, particularly in earlier years when DSL spending accelerates."

 The study also projects "employment up by an average 91,000 annually", and no impact on inflation.

Hence, it concludes that "relief granted to the Bells by the FCC Triennial Review and Appeals Court order will unleash capital spending that, to a large extent, would not have been undertaken without these actions."

The study states that it was prepared by Decision Economics, Inc., for the ACCF, and that it was funded by the ACCF.

The ACCF will hold a conference call at 9:30 AM EDT on May 4. To participate, call 1-800-576-4675.

NIST Releases Draft Report on VOIP Security

5/3. The National Institute of Standards and Technology's (NIST) Computer Security Division (CSD) released a draft [91 pages in PDF] of its Special Publication 800-58, titled "Security Consideration for Voice Over IP Systems".

This publication states that "Lower cost and greater flexibility are among the promises of VOIP for the enterprise, but the technology presents security administrators with significant security challenges. Administrators may mistakenly assume that since digitized voice travels in packets, they can simply plug VOIP components into their already-secured networks and remain secure. Unfortunately, the process is not that simple."

The publication also finds that "the implementation of various security measures can cause a marked deterioration in QoS. These complications range from firewalls delaying or blocking call setups to encryption-produced latency and delay variation (jitter). Because of the time-critical nature of VOIP, and its low tolerance for disruption and packet loss, many security measures implemented in traditional data networks are simply not applicable to VOIP in their current form."

The draft publication was written by Richard Kuhn, Thomas Walsh, and Steffen Fries. Public comments on this draft are due by June 18, 2004. Submit comments to Rick Kuhn at sp800-58@nist.gov.

Privacy Groups Argue that All Google Gmail Users May Be Criminals

5/3. Several groups continued their assault upon Google's proposed Gmail service, asserting privacy concerns. The Electronic Privacy Information Center (EPIC), the Privacy Rights Clearinghouse, and the World Privacy Forum wrote a letter to Bill Lockyer, the Attorney General of the state of California, asserting that "Gmail violates California Penal Code § 631, which governs eavesdropping on confidential communications." Not only do these groups argue that Google may be in violation of California law -- they also argue that "Users of the Service Could be Civilly and Criminally Liable" under § 631.

§ 631 provides, in part, that "Any person who, by means of any machine, instrument, or contrivance, or in any other manner, intentionally taps, or makes any unauthorized connection, whether physically, electrically, acoustically, inductively, or otherwise, with any telegraph or telephone wire, line, cable, or instrument, including the wire, line, cable, or instrument of any internal telephonic communication system, or who willfully and without the consent of all parties to the communication, or in any unauthorized manner, reads, or attempts to read, or to learn the contents or meaning of any message, report, or communication while the same is in transit or passing over any wire, line, or cable, or is being sent from, or received at any place within this state; or who uses, or attempts to use, in any manner, or for any purpose, or to communicate in any way, any information so obtained, or who aids, agrees with, employs, or conspires with any person or persons to unlawfully do, or permit, or cause to be done any of the acts or things mentioned above in this section, is punishable by a fine not exceeding two thousand five hundred dollars ($2,500), or by imprisonment in the county jail not exceeding one year, or by imprisonment in the state prison, or by both a fine and imprisonment in the county jail or in the state prison." See, text of §§ 630-637.9.

Google's Gmail is a new free browser based e-mail service that provides users with one gigabyte of storage space, which is far more than any other free e-mail service. In addition, Google's equipment scans e-mail messages, searches for key words, and then displays targeted advertisements with e-mail messages in the browser. Google further states that no person reads the messages.

EPIC and other groups assert that this violates California's illegal wiretap statute. EPIC argues that "California Penal Code § 631 establishes expansive protections for ``communications,´´ which clearly includes e-mail messages. Specifically, § 631(a) prohibits a broad range of activities where any person attempts to extract the meaning or content of a communication without consent of all the parties to the communication".

EPIC continues that "Google is willfully and without consent of all the parties to a communication extracting the content of messages in targeting contextual marketing. The action is willful because Google's Gmail was intentionally designed to engage in e-mail scanning. Google has failed to gain the consent of all parties to the communication because individuals directing e-mail to the gmail.com domain have no way of knowing that the company is extracting content from the messages, or consenting to such scanning. Finally, scanning the text of e-mails for marketing placement constitutes an attempt to "learn the contents or meaning" of the communication. Google depends on the actual content of the communication to make decisions regarding which marketing offers to display."

Then, EPIC argues that Google users too could be in violation of the statute. It wrote that "Section § 631(a) specifies that any person who ``cause[s] to be done any of the acts or things mentioned above in this section, is punishable by a fine not exceeding two thousand five hundred dollars ($ 2,500), or by imprisonment in the county jail not exceeding one year, or by imprisonment in the state prison, or by both a fine and imprisonment in the county jail or in the state prison.´´ Accordingly, if Google's Gmail violates § 631, its users could also be held liable."

See also, stories titled "Google's New Free E-Mail Service Starts Privacy Debate" in TLJ Daily E-Mail Alert No. 870, April 6, 2004; "Privacy Groups Request That Google Suspend Its New Free Gmail Service" in TLJ Daily E-Mail Alert No. 872, April 8, 2004; and "EPIC Inquires About Use of Google Technologies by FBI" in TLJ Daily E-Mail Alert No. 889, May 3, 2004.

People and Appointments

5/3. Mary Greczyn was named Executive Director of Freedom Technologies, Inc. She previously wrote about wireless and spectrum issues for Communications Daily. Freedom Technologies is a Washington DC based telecommunications consulting firm. Its principals include Janice Obuchowski and Albert Halprin.

More News

5/3. The Supreme Court denied certiorari in Jack Whitehorn v. FCC, No. 03-1318. See, Order List [7 pages in PDF] at page 2.

5/3. President Bush gave a speech in Niles, Michigan. He said, among other things, that "The more productive a society is, the most likely it is people are going to be able to have better wages and better earnings. The more productive a society we have in America, the more likely it is we're the leader in the world. And it's very important for us to be the technological leader in the world, and to be the leader in innovation, and that's why we got to have broadband technology in Niles, Michigan, for every home in Niles, Michigan."

5/3. The Department of Justice (DOJ) filed a complaint in U.S. District Court (DC) against Bill Gates alleging violation of the Hart-Scott-Rodino (HSR) Act of 1976 in connection with his purchase of securities in the ICOS Corporation, a pharmaceutical company based in Bothell, Washington. The DOJ announced in a release that Gates "has agreed to pay an $800,000 civil penalty to settle charges that he violated premerger reporting requirements", and that the DOJ has "filed a proposed settlement" with the Court. The DOJ added that this matter "is not related to Gates' position in Microsoft Corporation or the Department's antitrust litigation with the company". See, DOJ release.

5/3. Federal Communications Commission (FCC) Commissioner Michael Copps gave a speech [8 pages in PDF] in Washington DC. He addressed at length media consolidation and the public interest in terms that he has used frequently before. He stated that "What I see at this particular Commission is a tectonic shift in policy-making across the whole wide range of media and telecommunications issues that are under our jurisdiction. It is a shift in decidedly the wrong direction. We are endangering competition by putting too much power into the hands of too few people." He also briefly touched on digital television and radio, multicasting, and lower power FM.

Go to News from April 26-30, 2004.