News written by Petteri Pyyny (April, 2003)

According to the sources, the summary judgement hearing in 321 Studios court case that was scheduled to take place tomorrow, has been postponed to next week.

The reason for the delay hasn't been announced. The case that was about to start tomorrow is a countersuit filed by the seven major movie studios. Studios claim that 321 Studios violate the controversial DMCA law with their DVD copying products, DVDXCopy and DVD Copy Plus. Both tools allow circumventing the CSS encryption found on most DVD-Video discs.

Source: DVDXCopy support forums

Artist Madonna launched her latest album with an anti-piracy campaign in P2P networks, distributing MP3 tracks that looked like actual songs from artist's latest album, but contained simply a voice of Madonna asking "What the fuck do you think you're doing?".

Well, some clever hackers who obviously got relatively angry about artist's attitude against P2P networks, managed to hack her official website, madonna.com, during the weekend and posting all the tracks from her album American Life for download.

The hacked website simply stated: "This is what the fuck I think I'm doing". After the hacking was noticed, Madonna's site went offline for good 15 hours.

Source: The Register

RealNetworks has agreed to buy the only (semi-)independent online music subscription service provider, Listen.com, for about $36 million in cash and stock (of which $17.1 million is in cash). Real already owned a minority stake of the privately held company.

Real plans to bring the Listen.com's subscription service, Rhapsody, closer to its own subscription service, RealOne. However, the deal will most likely cause major shockwaves among the record labels, since Real has been -- and still is -- a big shareholder in Rhapsody's competitor, MusicNet, that is much more openly backed by major record labels (AOL TimeWarner, BMG and EMI). It also underscores partially the widening gap between AOL TimeWarner, whose online division AOL has started moving away from Real's server products and streaming solutions, and RealNetworks.

Source: News.com

American government delivered a blow to Verizon, one of the largest ISPs in the U.S., as it tries to fight against the RIAA in a court fight that began in last September.

U.S. Department of Justice said that the controversial DMCA law that RIAA is using to get Verizon to reveal one of its customer's identity, doesn't violate free speech rights of individuals, because it targets only at people who have committed copyright violations or are suspected of doing so.

RIAA wants Verizon to reveal the customer's name, because RIAA claims that the user has distributed illegal music over the P2P networks by using Verizon as an ISP. Verizon lost its case in January in district court, but is currently appealing the decision.

News.com

Korean consumer electronics giant, Samsung, released a new portable MP3 player on this week that supports so-called "surround sound simulation" -- decoding routines try '(although, most of the times don't manage) to make the stereo audio to sound just like the surround sound.

But despite this feature that sounds pretty much like a feature invented solely for the marketing guys, the player sounds nice enough anyway. Samsung claims that with one AAA-sized battery, the player, Yepp YP-55, can provide over 15 hours of continous playback. Player will also include MP3 recording option and SRS Labs' Trubass low-frequyency enhancement technology. Player will be available in South Korea on next week for $172 (128MB version) or $205 (256MB version). Company hasn't announced schedule for U.S. or European releases.

More information:

Samsung's press release
TheRegister

The previous attempt to sell SonicBlue's main assets, the ReplayTV and Rio brands, to Japanese D&M Holdings failed because the companies couldn't get their deal details ready before the court's deadline. But now the Rio and ReplayTV are finally sold to the D&M for $36.2 million.

The sale covers the intellectual property, inventory and capital equipment of the ReplayTV and Rio units. The price D&M paid in the backruptcy court auction was actually $5M cheaper than the deal it had negotiated with SonicBlue in March before the deadline was exceeded.

Source: Yahoo!

AOL, the Net unit of AOL TimeWarner, has licensed the video encoding technology called TrueMotion and its versions VP5 and VP6 from company called On2. AOL plans to use the video encoding technology to deliver video content to its various web resources and its massive subscriber base.

AOL has declined to state how exactly it plans to use the video codec in future, but it has an existing licensing agreement for On2's previous video codec, VP3.2 that it uses in its WinAMP3 media player. According to analysts, AOL's licensing deal is yet another step towards an autonomous position in streaming market -- AOL has in the past been one of the biggest customer's of RealNetworks, but has launched several products and development plans this year that don't use Real as streaming platform anymore.

On2 became a relatively well-known name in last year when it donated its old video codec, VP3, to Xiph.org to develop an open-source competitor to MPEG-4 platform.

Source: News.com

Rumour mill has been spinning wildly over the last couple of days around the world's largest record label, Universal Music Group (which is currently owned by French Vivendi). So far, the biggest names presented as potential buyers of the media giant are Microsoft and its arch-rival Apple.

Apple's position, according to rumours, is closer to an actual deal than that of Microsoft's. According to New York Post article, Microsoft has been "poking around, kicking the tires" and has had conversations with the Vivendi executives. Meanwhile, Apple's rumours seem to be more deep-rooted and there's even a alleged pricetag, $6 billion, that Apple would be ready to pay for the UMG.

Both companies have been extending their tentacles towards people's living rooms over the last couple of years and by acquiring the UMG, the reach would be in much, much bigger scale. WMA-only audio CDs, anyone?-)

More information:

New York Post
Reuters

Dutch consumer electronics giant Philips has added Net streaming capabilities to its so-called reference model.

The stand-alone reference DVD+R/RW recorder model will include LAN support and a video codec that will support MPEG-4 and its varieties, such as the recently standardized H.264 -- company also mentions specifically that the player will support DivXNetworks' MPEG-4 codec as well.

The idea behind the "reference models" is that the original manufacturer -- in this case, Philips -- develops fully equipped product that it then licenses as a specification or component-by-component or even exact full product, to third party manufacturers who wish to have their own entrance to the DVD player markets without the research and development required to build a DVD player from the scratch.

The specs don't exactly specify whether the player is capable of playing MPEG-4 videos from the CDs or DVDs, or just simply from the LAN connection.

Source: Electronic Business Online

The British Internet cafe chain, easyInternet, wont challenge the High Court ruling that declared in January that its cafes violated copyright laws by allowing customers to use CDR burners.

Company was sued by the British Phonographic Industry (BPI), the British equivalent of the RIAA in 2002. The case seemed silly, but High Court disagreed -- and probably the defence the easyInternet chose to use wasn't exactly the best possible one. easyInternet didn't point out in their defence that they simply allowed their consumers to use normal part of the computer equipment that can be used (and most would claim that is normally used) for perfectly legal uses as well.

Anyway, in January, easyInternet was ordered to pay damages of £210,000 (appx. $320,000 or €310,000). But since then, easyInternet has, according to the BPI's press release, "provided new financial information that enabled BPI to assess the level of compensation that EasyInternet was liable to pay. EasyInternet also confirmed that it would not run unlicensed CD burning services in the future".

Source: The Register

The international recording industry association, IFPI, released the sales figures for year 2002 and according to those numbers, the worldwide CD sales dropped appx. 7 percent compared to the 2001 figures.

In the United States, the drop was even bigger, 10 percent. Obviously the recording industry is pointing its finger at the worldwide music piracy, most notably the digital music piracy in form of P2P networks (and obviously they don't even suggest that the widespread use of copy-protection mechanisms that make CDs incompatible with thousands of CD and DVD players, would have anything to do with the drop). But they surprisingly do admit that movie and game businesses are eating the amount of money people are willing to spend on music.

This year's figures hold no surprises," said Jay Berman, chief executive officer of the IFPI. "Widespread use of illegal sites, made easier with the growth of broadband access in the major markets, is affecting an industry that is also having to compete with increased sales of other entertainment formats such as DVD films and new video game consoles."

Source: News.com

RIAA has busted four individual university students in three different U.S. universities, claiming that they've distributed thousands of illegal MP3 files using their dorms' Net connections and P2P networks. RIAA is seeking for a very moderate compensation, mere $150,000 per distributed song, for damages.

Otherwise the cases are pretty clear, some of the students sued in this instance, were running Direct Connect P2P clients, distributing the MP3s over the DC network. But at least one of the students was running a search engine that would allow users to search shared files within the campus network, not a P2P client. And as far as we know, running a search engine -- whatever it happens to find -- is perfectly legal, otherwise Google would've been busted for a long time ago.

RIAA's take on the issue is obviously somewhat different: "Differences are irrelevant from a copyright perspective," said RIAA Senior Vice President Matt Oppenheim. "All of these are networks created for one purpose and are being used for infringement."

Source: News.com

20th Century Fox, the last major movie studio that has stayed out of the online movie distribution business ever since its joint venture with Disney collapsed in last year, has signed a licensing agreement with CinemaNow.

CinemaNow competes against Movielink, a company owned by virtually all other major movie studios except Fox and Disney. Both services offer downloadabale versions of movies under pay-per-view model for broadband users. Studios have been cautious of entering into the business big time, fearing that the existing copy protection mechanisms available for such distribution, will be cracked and that would allow pirated copies to be made from movies distributed via online channels. CinemaNow has previous licensing agreements for movie catalogs from three other major movie studios -- MGM, French Vivendi's Universal Pictures and AOL TimeWarner's Warner Bros.

Probably two things have changed studios' way of thinking -- first of all, the DRM systems have improved a lot during the last year or so. And secondly, the movies they're so much protecting, are already available via P2P networks for free. 20th Century Fox is a unit of Australian News Corp..

SonicBlue, the company which is well-known of its mega-popular digital multimedia products such as Rio MP3 player and ReplayTV PVR devide, filed a Chapter 11 bankruptcy in last month, but said that it is prepared to sell its brands to Japanese D&M Holdings in order to save some of its shareholders' value. Now that deal has failed.

Bankruptcy court set a deadline for SonicBlue's reorganization arrangements, but SonicBlue failed to finalize the deal with D&M before the deadline. This means that company's main assets, Rio and ReplayTV, are to be auctioned on 15th of April. Company's other products, such as GoVideo line of dual-deck VCRs, will be auctioned at 4th of April. SonicBlue had more than $330M of debt in November last year.

Source: InternetNews.com

Norwegian economics crime division said today that an appeals court has approved to handle the prosection's appeal in case against norwegian teenager, Jon Johansen.

The trial, dubbed as "the DeCSS case", will start in December. Johansen won his case early this year in lower court, leaving movie industry healing its wounds and preparing for the next attack.

Johansen is being accused of developing a software called DeCSS that allows users to crack the weak copy-protection mechanism called CSS found on most commercial DVD-Video discs. By cracking the encryption, users that don't have access to officially licensed DVD players (like Linux users) can watch DVD movies with their computers. As a side effect, the software also allows copying the DVD-Video disc to computers harddrive and distributing it over the Internet.

The most ridiculous thing in the whole process is the fact that Norway doesn't have any laws that would outlaw such activity and therefor Johansen is basically sued under laws that are meant for crackers who break into banks' computers and steal money. So, Johansen is being sued for breaking into his own, purchased DVDs.

Source: ABCNews.com