All Things Digital

If there was an Emmy Award for legislation production, NBC Universal Chief Executive Jeff Zucker would surely win it. Last October he called upon Congress to pass a bill that would create a dedicated intellectual-property enforcement bureau and today it’s looking more and more like he’s going to get it.

This week members of the House Judiciary Committee passed the Prioritizing Resources and Organization for Intellectual Property (called “PRO IP” groan…) Act of 2007, legislation that would create an “anti-piracy czar” at the White House level, a separate IP-enforcement division at the Justice Department and ratchet up already high civil penalties for copyright infringement.

The measure is backed by many of the most powerful politicians on the House Judiciary Committee, including John Conyers (D., Mich.), Lamar Smith (R., Texas) and “Hollywood” Howard Berman (D., Calif.), the content cartel and, of course, Zucker, who likes to tell everyone that it dramatically advances the cause of protecting innovation, technological invention and creativity.

Said Zucker, “This is such an important step in combating this incredibly serious piracy and counterfeiting problem that’s getting worse, not better.”

In Zucker’s eyes, maybe. But not in the eyes of consumer folks like Google Senior Copyright Counsel William Patry who calls Pro IP “the most outrageously gluttonous IP bill ever introduced in the U.S.” and consumer advocacy group Public Knowledge which feels it is in sore need of adjustment.:

This bill takes already extraordinary copyright damages and increases them, expanding the threat of litigation intended to stifle competition and innovation. … Increasing penalties is one of the least necessary, and quite possibly counterproductive, actions the committee could take, particularly when current law is adequate to deal with most infringement issues and because the higher penalties serve only to force faster and larger settlements potentially from innovators. … Instead of following the course of this bill, the committee should look to the future, to a more realistic and rational copyright regime that can adapt pre-VCR copyright laws to a post-YouTube world.”

If YouTube aims to someday host every music video ever made, as co-founder Steve Chen once claimed, it better get crackin’. Because the market’s getting crowded.

This morning PluggedIn Media launched a new service for streaming HD-quality music videos. Backed by Overbrook Entertainment–Will “Gettin’ Jiggy Wit It” Smith’s production and management company–PluggedIn will offer some 10,000 videos from EMI (EMI.L), Vivendi (VIV.PA) and Sony BMG (SNE), along with the standard music-site fare–artist bios, users playlists and whatnot. That being the case, how does PluggedIn hope to differentiate itself from the competition? “We look at all the changes shaping online entertainment and see massive opportunity for lots of companies to appreciate and forge really viable consumer connections,” said CEO Jeff Somers. “We think what will separate us from what is out there today is an unbelievable high-quality viewing experience, matched with in-depth content and community tools.”

Perhaps. But it will also create dangerous rivalries with some powerful competitors. With its social-networking features, PluggedIn will soon find itself in direct competition with MySpace Music (NWS) as well as Hulu (GE).

Here’s a clever way of streamlining the acquisition process: Become a platform-as-a-service provider and encourage developers to create Web applications using your proprietary database and your APIs (application programming interfaces).

That seems to be what Google (GOOG) has done with App Engine, a new service for developers who’d like to write and run their Web applications on the company’s infrastructure. With App Engine developers can establish their own little Google Labs outposts, building Google-friendly applications using Google’s own building blocks on the Google File System and Google will handle the scaling and fail-over issues.

That’s a compelling proposition–assuming you want Google to control your entire end-to-end development environment. And who wouldn’t these days? What better way to pique the search giant’s acquisitive interests than building a great big Web 2.0 sandcastle in its very own Web 2.0 sandbox? Who knows, you may be the next YouTube or, at the very least, the next Zingku or Jaiku. And if it turns out that you are, how convenient would it be for Google to acquire you, as Dave Winer noted a while back at Scripting News:

How much would it be worth to buy companies without having to transition their technology to their platform? There would be no retraining either, all the programmers in the companies they acquire would know how to work in the environment. Further, can you imagine that they’d charge universities to teach comp sci using their cloud?

“Given the cost of acquisitons, recruiting and training they can afford to blow a lot of money on free bandwidth, storage and CPU to make the buying and hiring process more efficient and increase the hit rate (the percentage of programmers who work out).”

YouTube’s going white label. This morning the online video outfit published APIs (application programming interfaces) giving publishers the ability to offer YouTube’s services directly to their own users. The move allows for the creation of so-called “chromeless” players–tailored to a publisher’s specifications and outfitted in their own branding–through which videos can be uploaded and viewed without ever visiting YouTube’s site. From the announcement:

YouTube’s latest API offerings allow anyone building a Web site or software application that is connected to the Internet to upload videos straight to YouTube; let users comment, rate and favorite the videos; and customize and control the Flash player in which the videos are played. This can be used in conjunction with the existing APIs, which launched last year and which provide the ability to view videos on other sites and to search for videos on YouTube.

“The enhancements to the YouTube APIs and Tools offering are free and easy to use, giving YouTube users yet another way to engage the world of video and actively participate in the YouTube community wherever they are, whenever they want.”

Of course, these enhancements also give YouTube and, by extension, Google (GOOG), another way to engage the world of advertising. In the API’s terms of service, YouTube reserves the right to serve ads through a publisher’s API Client, but prohibits publishers from selling their own. Two relevant excerpts from the TOS:

I. Definitions
“API Data” means any data or content, including but not limited to YouTube video content, obtained from YouTube using any YouTube API, including advertising content that YouTube may, in its sole discretion, provide along with or insert in data or content obtained from YouTube using the YouTube API.”

4. Commercial Use. You agree not to use the YouTube API for any prohibited commercial uses, which include the following actions taken without YouTube’s express approval:

• the sale of the YouTube API, API Data, YouTube video content or related services, or access to any of the foregoing;
• use of the YouTube API for the primary purpose of deriving revenues from your API Client, such as advertising or subscription revenue or the sale of copies of the API Client;
• the sale of advertising, sponsorships or promotions targeted to, within or on the API Client or YouTube video content.

Ah. So that’s how it is: YouTube doesn’t just broadcast you, it broadcasts advertisements as well.

UPDATE: YouTube product manager Jim Patterson tells TechCrunch that the API is open to YouTube Partners, who will share in the advertising generated by their players.

We are not introducing any fundamentally new way to monetize. Any video that is uploaded through our API is treated exactly as on YouTube.com. In general if a video is uploaded to YouTube, in some cases we serve ads into that on YouTube.com. When people embed those we reserve rights to serve ads in the future.”

YouTube: Borecasting in 2008

YouTube will add live video sometime in 2008, according to co-founder Steve Chen. “Live video is just something that we’ve always wanted to do,” said Chen. “We’ve never had the resources to do it correctly, but now with Google, we hope to actually do it this year.”

Less than 5% of Pakistan’s citizens have Internet access, but those who do must have nasty tempers. Fearing that a reportedly anti-Islamic YouTube video would incite civil unrest, the Pakistani government ordered the country’s Internet service providers to block access to the video site, inadvertently triggering a two-hour long, global outage of YouTube yesterday.

Seems Pakistan Telecom blocked YouTube by hijacking its IP address and directing it to a so-called “black hole.” But when it sent that address out to the country’s Internet providers, it accidentally passed it on PCCW, one of Asia’s leading ISPs, as well. And PCCW propagated it to the rest of the world, and YouTube went down.

“It is exactly like the ‘game of telephone’ that kids play,” one network engineer explained: “For example, Pakistan Telecom says ‘I am responsible for 1.2.3.4 (some IP address)’ and then they tell PCCW. PCCW tells Verizon Business and NTT and others. NTT tells us, and so when my customers ask ‘Where is YouTube,’ we’re just answering based on what we’ve heard. … But all we know is that we heard it from NTT, who heard it from PCCW, who heard it from Pakistan Telecom. If Pakistan Telecom was lying (or made a mistake), we’d have no way to verify it.”

Apparently the transitive trust system on global routing is based can’t be trusted. “Whether accidental or not, the black-holing of YouTube by Pakistan Telecom demonstrates a serious weakness in the ‘longest prefix wins’ rule: There is no concept of trust contained in it,” Tomas Byrnes wrote in a message to the North American Network Operators Group mailing list. “Trust, whether implicit or explicit, is inherent in all human interactions, yet expressing it in cyberspace has continued to be troublesome. In routing decisions, once you are beyond a connected (either directly or multi-hop) peer, it becomes much more difficult.”

What do you get when you cross a cowboy, a construction worker, a biker, a soldier, an American Indian and a police officer? Why, the Village People, of course. But throw in a Web Sheriff and you’ve got a lawsuit: The aging disco group has teamed up with the U.K.-based antipiracy outfit to sue Swedish torrent index The Pirate Bay for enabling illegal downloads of its song “Y.M.C.A.”

A chart topper in 1978, Village People’s “Y.M.C.A.” has been played in thousands of baseball stadiums and karaoke bars and even performed by former Secretary of State Colin Powell at the ASEAN Forum, an annual security meeting for foreign ministers (”President Bush, he said to me: Colin, I need you to run the Department of State. We are between a rock and a hard place.”) without incident.

But its alleged popularity in file-sharing circles–particularly after the appearance last year of a YouTube video combining it with historical footage of Adolph Hitler and other Nazis–has drawn the group’s ire, as well as that of Prince, who is also reportedly part of the suit. “We are suing for damages of millions of dollars, and [suits] will be filed at both Swedish as well as U.S. courts,” Web Sheriff Chief Executive John Giacobbi told Swedish online business daily e24. “Many are asking themselves why they should be paying for content when it is widely available free of charge. But such thinking disregards the fact that someone has been creating this music or movie, and [has] invested huge sums of money in the project. Therefore it should be up to [the creators] to decide how and to whom their works are being distributed.”

Giacobbi, it should be noted, is calling upon other artists to join the suit in the hopes of giving it more critical mass and credibility, though his choice of artists may achieve quite the opposite. Said Giacobbi, “It would also be good/appropriate if the members of ABBA could take up the fight against these pirates, as they personify the Swedish music industry’s successes and are renowned ambassadors for Sweden, contrary to The Pirate Bay.”

One can only the imagine the fun the folks at The Pirate Bay, who’ve publicly ridiculed legal threats from everyone from Warner Bros. to Apple, are going to have with this one.

According to last year’s safely-looking-ahead-to-the-year-to-come lists, 2007 was to be “a year of hyperdisruption for the technology industry”; it was to be “a year of significant developments” and “a year of evolution”; it was to be “a year of invention and innovation,” “a year of experimentation” and “a year of slow, but significant, change”; it was to be “a year of carnage,” but it was also to be “a year of great happiness and multiple blessings.” Above all, 2007 was to be “a busy year for technology.”

Which, as you’ll see below (and in our companion video), is pretty much how it turned out. What follows is Digital Daily’s abridged guide to the year in tech news–a fond reminiscence of what was, and our First Annual Year-End List For Year-End List Haters.

1. Yahoo Shareholders Reject Plan to Tie Executive Compensation to Company’s Crappy Performance
   Well, what do you know: Yahoo’s annual shareholder meeting didn’t conclude with CEO Terry Semel’s head piked on the exclamation point of the Yahoo sign outside company headquarters.

2. I Know It Was You, Fredo. You Broke My Heart. You Broke My Heart!
   Apparently, Fred Anderson is the “Fredo” of the Apple options backdating family.

3. We’ve Asked John Williams to Do a Special Performance of the Theme From “The Poseidon Adventure” for Our Q4 Results
   Who’s programming Microsoft’s on-hold music, Apple’s Phil Schiller? Waiting for the company’s third-quarter earnings call to begin yesterday, those listening in were treated to an instrumental piano version of Celine Dion’s “My Heart Will Go On.” From “Titanic,” the disaster movie.

4. I’m Proud to Say Our New “Soylent Green” iPod Is Made of 100% Biodegradable Greenpeace Activists!
   If you’re going to try to smear Apple for reckless environmental practices, you best have some hard epidemiological and toxicological data on hand, because goofy Photoshop treatments of the company’s marketing materials just can’t stand up to a blow from the Apple PR machine.

5. And Online Display Impressions Soared as More Americans Checked Their AOL Accounts for Old Times’ Sake
   To hear tell from Time Warner executives, the company’s better-than-expected earnings for the first quarter owed quite a bit to gains in online-advertising market share by its AOL Internet division.

6. Web 2.0 Audience in Mirror May Be Smaller Than It Appears
   How ironic is it that Web 2.0–the “participatory Web”–has far fewer participants than its architects would have us believe?

7. And for My Next Trick, I’ll Turn Myself Into a Complete Jackass
   If you’re going to demand that YouTube remove a video to which you object under the Digital Millennium Copyright Act, it’s probably wise to make sure that you actually understand the DMCA.

8. War Is Peace. Freedom Is Slavery. Ignorance Is Strength. DRM Is DCE.
   You can’t put frosting on manure, but HBO’s Chief Technology Officer Bob Zitter isn’t above trying.

9. We’re Naming It the Motorola STNKR, After Our Q1 Earnings …
   Carl Icahn was right. Motorola really is desperate for a new product. How else to explain a patent the company was awarded last month for a “communication device having a scent-release feature and method thereof.”

10. The Frienemy of My Frienemy Is My Enemiend
    If Microsoft is planning an acquisition in the online marketing and advertising space, it better act fast, because if it waits much longer there won’t be anything left to acquire.

11. How Would Monsieur Ellison Like His BEA Served? Mixed in a Bucket With Oracle’s Other Acquisitions?
    Looks like we may be in for another PeopleSoft-esque takeover drama …

12. I’m Just Biding My Time Here Until I Can Quit and Study Whale Feces Full Time
    Given the chance, how would you alter the course of your career? Well, if you worked at Microsoft’s Security Response Center, you might consider taking a job as an Olympic drug tester, a gravity research subject, or a “whale-feces researcher.”

13. Much Like Energy, BS Cannot Be Created or Destroyed, It Can Only Be Changed From One Form to Another
    If Steorn’s perpetual motion effort is anything like its e-commerce venture (and by all accounts things do seem to be going that way), the only thing in its future is insolvency.

14. From Now On, We’ll Be Known as Nlsn/NtRtings
    Looks like vowels won’t be the only accoutrements to be tossed aside in the rise of Web 2.0. The venerable page view is to be abandoned as well.

15. The Defendant Stands Accused of Copyright Infringement, Breach of Contract and Misappropriation of Dumb Luck
    According to popular legend Facebook founder Mark Zuckerberg once kept two versions of his business card in his wallet–one with the title CEO, the other with “I’M CEO . . . BITCH.”

16. Well, Here Come YouTube’s Video ID Tools. Guess That Means Godot Will Be Here Any Minute Now
    Google’s apparently finished “educating users about copyright law” and has moved on to the far more important business of making sure not to run afoul of it.

17. Look at It This Way: Now That Yahoo’s an ‘Ecosystem,’ the EPA Can Finally Declare It a Superfund Site
    “Our financial performance is not what we would like to see long-term.” This, from Blake Jorgensen, Yahoo’s chief financial officer who, just six weeks into the job, is already well versed in the company’s fiscal truisms.

18. Gates to Google: My Lyrical Technique Will Leave Your Body Weak
    Much as Microsoft Chairman Bill Gates fancies himself untroubled by Google’s incursions into his software empire, they clearly do chafe him a bit.

19. Newest Yahoo Mail Feature: BCC Beijing
    Sure, Yahoo signed China’s “Public Pledge on Self-Discipline for the Chinese Internet Industry,” a voluntary agreement to monitor and restrict information deemed “harmful” by Beijing, but did it have to take it quite so seriously?

20. Apple: Wham, Bam, Thank You Fanboi
    “I feel like a $200 whore.” That was one iPhone early adopter’s crass assessment of his feelings of self-worth, after Apple unexpectedly cut the price of the device by a third–just two months after it arrived at market.

21. In the Unlikely Event of a Water Landing, Sergey’s California King May Be Used as a Flotation Device
    With its onboard hammocks, full-size sofas and California King beds, it’s a wonder Google’s “party plane” has room for scientific instrumentation befitting the National Aeronautics and Space Administration, but apparently it does.

22. Act Now and Get a Downgrade to the OS You Really Want, ABSOLUTELY FREE!
    It’s looking more and more like the pent-up demand for Windows Vista we’ve heard so much about this past year is really just pent-up demand for Windows XP.

23. Dude, I Work for Friggin Forbes Magazine. Have You Heard of It?
    The year-long guessing game is over. New York Times reporter Brad Stone has outed Daniel Lyons, a senior editor at Forbes magazine, as the author of the Secret Diary of Steve Jobs, the satirical blog lampooning Apple’s iconic CEO (See? Told you it wasn’t me).

24. If Facebook’s Worth $15 Billion, Then My Stupid Idea’s Got to Be Good for $10 Mil
    Apparently the vainglory from which Facebook CEO Mark Zuckerberg appears to suffer is communicable and spreading rapidly throughout the social network’s developer community.

25. A Billion Here, a Billion There, and Pretty Soon You’re Talking Real Bollocks
    MySpace is worth $65 billion in the same way that Facebook is worth $15 billion–hypothetically.

26. “Apple Has Destroyed the Music Business”–Not That We Didn’t Try Our Best
    Many, many years ago, when the digital-music business consisted of little else besides Napster and the Recording Industry Association of America’s lawsuits against it, Apple proved that there was indeed a decent business to be had in selling music online for $1 per song.

27. It’s Not an Unpaid Endorsement, It’s a “Social Ad”
    Facebook’s Social Ads aren’t endorsements, they’re a “representation” of user activity.

28. Obama Announces “No Tech Policy Left Behind” Plan
    If Google’s mission is to organize the world’s information and make it universally accessible and useful, then Democratic presidential candidate Barack Obama’s is to do the same to its tech-policy issues.

29. Sounds More Like the “Zune of Reading” to Me
    If Jeff Bezos truly hopes to create “the iPod of reading,” observers say he’s going to have to do a hell of a lot better than Amazon’s new Kindle e-book reader.

30. Fiascobook
    What Facebook CEO Mark Zuckerberg lacks in foresight, he certainly makes up for in disingenuous hair-shirt remorse.

Note: John Paczkowski is on vacation and won’t be writing or posting videos until he returns on Monday.

To keep you abreast of tech news while he’s away, we’re compiling a daily digest of 10 must-read tech stories. Our Tech 10 appears below.

1. Bienvenue, iPhone: France Telecom has begun selling Apple’s cellphone at selected Orange stores in Paris and other cities. The device itself will cost about $1,106 with no plan attached, or 399 euros (about $590) with one of four “Orange for iPhone” plans, Computerworld notes, adding it will cost 100 euros ($148) to unlock the handset.
2. FCC Says ‘Uncle’: A proposal by Federal Communications Commission Chairman Kevin Martin to tightly regulate the cable TV industry has been “drastically” trimmed, reports the New York Times, which noted that Martin had sought more diverse programming and reduced cable costs.
3. Amazon: 1; Feds: 0. The federal government has lost its bid to compel Amazon to release details about the book-buying habits of thousands of its customers, according to Declan McCullogh on his blog, The Iconoclast. The Justice Department sought the information to prove its case against a former Madison, Wisc., city official accused of evading taxes in selling used books online.
4. Google, Online Snitch? The search colossus has voluntarily given the IP address of an Israeli blogger who used “Google Blogger” to allegedly slander municipal council members running for reelection, the Israeli Web site Globes Online reports, calling the move “unprecedented.”
5. YouTube, Censor? The popular video-sharing site has suspended the account of a well-known Egyptian anti-torture activist who posted videos of alleged brutality by a number of Egyptian policemen, Wael Abbas told Reuters, claiming that about 100 images he had sent were no longer available on YouTube.
6. But It Doesn’t Mind those CondéNet Vids: CondéNet is announcing today that it will distribute videos from its various consumer-interest Web sites via YouTube, The Wall Street Journal reports, adding that the deal is the latest in a series for Condé Nast Publications’ digital division.
7. LinkedIn Link to News Corp.? A “well-placed source” has told VentureBeat that News Corp. (owner of this site) is in talks to buy business-networking site LinkedIn. But LinkedIn CEO Dan Nye told Fortune’s Adam Lashinsky that “It would take a helluva lot” to get him to sell.
8. The Earth, Updated: Google Maps is updating its features, prompting Duncan Riley at TechCrunch to wonder if the new features won’t ultimately send Google Earth down the path of the dodo.
9. Feeling Insecure: Web applications and holes in Windows Office are the top concerns of Internet users, according to the annual security report by SANS, a computer training and security organization, in its Top 20 risk assessment for 2007.
10. How Green Is My Gaming? Greenpeace has released a report slamming Nintendo and Microsoft for making their video-game consoles with toxic chemicals, reports BusinessWeek, noting that the enviro group’s latest ranking of electronics firms this week also highlights questions over the environmental impact of the products and how much consumers care about them.

–posted by Associate Editor John Sullivan

In 2010, it could take as long as two minutes to download an episode of “Chad Vader–Day Shift Manager” from YouTube, instead of the few seconds it takes today. This according to a new study from Nemertes Research Group, which claims that the Internet could be approaching its capacity. “Our findings indicate that core fiber and switching/routing resources will scale nicely to support virtually any conceivable user demand,” Nemertes explains in “The Internet Singularity, Delayed: Why Limits in Internet Capacity Will Stifle Innovation on the Web.” “But Internet access infrastructure, specifically in North America, will cease to be adequate for supporting demand within the next three to five years.”

And what does that mean in lay terms? “Users will experience a slow, subtle degradation, so it’s back to the bad old days of dial-up,” said Nemertes President Johna Till Johnson. “The cool stuff that you’ll want to do will be such a pain in the rear that you won’t do it.”

To avoid such a scenario, Nemertes says backbone providers need to invest up to $137 billion in Internet infrastructure capacity–more than double what they’d planned. If they fail to do so, we may see that slow degradation to which Johnson referred and a stifling of innovation. “It’s important to stress that failing to make that investment will not cause the Internet to collapse,” Nemertes explains in its paper. “Instead, the primary impact of the lack of investment will be to throttle innovation–both the technical innovation that leads to increasingly newer and better applications, and the business innovation that relies on those technical innovations and applications to generate value. The next Google, YouTube or Amazon might not arise, not because of a lack of demand, but due to an inability to fulfill that demand. Rather like osteoporosis, the underinvestment in infrastructure will painlessly and invisibly leach competitiveness out of the economy.”

Nemertes’s last point about underinvestment in infrastructure is one worth noting. Because in the run-up to the Telecommunications Act of 1996 the incumbent telecoms promised to provide fiber-optic connections to millions of households across the country. In exchange, they were given some $200 billion in tax cuts and higher service rates to pay for it. But the telecoms didn’t spend that money on fiber upgrades–they spent it on long distance, wireless and inferior DSL services. “By 2005, if the Bell companies had actually delivered on their broadband promises, approximately 86 million households would have had fiber-optic-based services,” Bruce Kushnick, executive director of New Networks Institute, explains in “The $200 Billion Broadband Scandal.” “These state commitments also would have rewired schools and libraries, hospitals and government offices. And in most states, the plan called for ALL customers to be rewired equally, whether they were in rural or urban areas, rich or poor. Universal broadband was to be accomplished state-by-state because customers were, in essence, de facto investors funding these network upgrades.”

Something to think about when the Nemertes’s study begins popping up in telecom arguments against Net neutrality, as it almost certainly will.

Good thing Viacom and CBS Corp. Chairman Sumner Redstone plans to live at least another 50 years; he may actually be around long enough to see the realization of Viacom’s grand Internet strategy and its bet on the marriage of old-line media assets with new distribution technologies. Assuming, of course, the sanctity of copyright is preserved.

Speaking at the Dow Jones and Nielsen Media and Money conference this week, Redstone, whose company is suing YouTube seeking $1 billion in damages for what it terms “massive intentional copyright infringement,” said content still rules the digital domain. “Copyright compels creativity,” he said. “It furnishes the incentive to innovate. If you limit the protection of copyrights, you stifle the expression of new ideas. Think about it. You cannot pay the rent posting videos on YouTube. And most aspiring novelists do not aspire to self-publish. You cannot make it as a musician or filmmaker or writer without the shelter of effective and enforced copyright legislation.

“… If content is king,” Redstone concluded, “then copyright–the legal and moral position that the fruits of intellectual labor should be protected in order to encourage creative expression–is its castle.”

And YouTube is, clearly, the Trojan rabbit that’s already made it past the gates …