Some reporters have told me that they thought 'Hollywood's hackers', a term we use to describe how the Hollywood cartels have installed spyware with CDs or gotten people like Orrin Hatch to advocate blowing up computers, was misleading.

Well, looks like Hollywood is employing hackers.

CNET is reporting on a lawsuit filed by TorrentSpy alleging that the MPAA paid a hacker $15,000 to steal emails and trade secrets.

One MPAA executive is quoted in Torrentspy's lawsuit as saying: "We don't care how you get it," referring to the alleged assignment to dig up information on Torrentspy.

Some of the information that the man allegedly pilfered included a spreadsheet containing Torrentspy income and expenses from January to June 2005, copies of private e-mails between Torrentspy employees, detailed information on the company's servers, and billing information, according to the lawsuit.
Torrentspy alleges in the suit that the man, whom the company refers to as the "informant," has provided documents that prove the nature of his relationship with the MPAA, including a written agreement signed by the hacker and an MPAA executive, Rothken said.

It's pretty obvious that the Hollywood cartels have no respect for the law unless they paid for it. There is a consistent and lengthy record of the cartels flagrantly breaking the law while attacking companies, like XM, that operate entirely legally.

There has been a very large debate in Europe over software patents. Although IPac is an American organization we're happy to see this. From CNET:

The Commission said last week that computer programs will be excluded from patentability in the upcoming Community Patent legislation and that the European Patent Office will be bound by this law.

You asked for 'em.

We've just added a bunch of new blog buttons that are not tied to any one campaign.

You can get them here.

The tech world is abuzz with news of XM being sued by the Hollywood cartels. I've compiled a lot of comments from tech leaders and organizations:

Gigi Sohn of Public Knowledge:

Consumers for years have had the legal right to record music for their own use. This lawsuit threatens that right on the grounds that consumers now have advanced technology at their disposal in recording songs. The shame of the legal action, however, is that this is really a dispute between XM and the recording industry over licensing fees. The companies should be left to figure out a solution without interference from the courts or from Congress.

CEA:

There they go again. The record industry is returning to the courts in their non-stop efforts to stop new technology, frustrate consumers and make illegal long-standing consumer home recording activities. Their new target is XM Satellite Radio, one of America's top technology success stories of the new millennium. XM's only offense is providing legal and exciting programming options to millions of Americans, while opening new revenue and promotional opportunities for the recording industry.

The lawsuit announced yesterday is a brazen effort by the labels to strong-arm more money from a successful technology industry startup. XM Radio already is the largest single payer of digital music broadcast royalties. More, the record labels receive royalties on every XM recording device sold as provided by Congress under the Audio Home Recording Act (AHRA).

...

It is time to say 'enough is enough.' It is time to put an end to ill-founded lawsuits and over-reaching legislation that impose an 'innovation tax' on consumers and technology developers. These ongoing efforts discourage innovation and jeopardize America's global technology leadership.

If only the music industry spent as much time adopting digital business models as they do filing lawsuits and advocating anti-consumer legislation, they might find that technology can actually expand their market. Instead, this litigation undermines our efforts to work with the recording industry on digital technology issues of mutual interest.

On behalf of American consumers and technology innovators, we look forward to standing with XM as it defends this lawsuit. The consumer technology industry will continue to take a strong stand against persistent, punitive, and over-reaching efforts by the record labels to control innovation and limit reasonable consumer activities.

And of course, the EFF is on top of it:

An attack on home taping: In the RIAA's view, home taping is illegal, at least when done with today's digital tools: "The XM+MP3 subscribers are creating unauthorized reproductions of Plaintiffs' copyrighted sound recordings,... and therefore are guilty of direct copyright infringement...." So much for fair use. So much for the AHRA. Sorry Pioneer, Samsung, and all the other innovators out there, but apparently home taping is only legal so long as the RIAA dictates the feature-set of the recorders.

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Transmission + Recording = Distribution: As we've discussed previously, the RIAA has been trying to expand the scope of the "distribution" right on the backs of individual P2P file-sharing defendants in cases like Elektra v. Barker. The goal? To force broadcasters (and others who thought all they were doing was publicly performing music) to pay a second time for distribution licenses. If the RIAA wins on this score, then radio stations and webcasters are all in hot water, too.

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Holding design against innovators. The RIAA claims that XM should be held liable for both inducement and vicarious liability because it could have designed its technology differently, an argument familiar from the MGM v. Grokster battle. Of course, in that case even the Department of Justice (see fn.3) rejected the RIAA "you could have designed it differently" argument as baseless. If the RIAA succeeds this time, innovators could face liability whenever a court decides they didn't do "enough" to prevent infringement. The value of "enough," of course, will not be revealed to you until after you spend millions in legal fees and risk losing your company to ruinous statutory damages.

It would seem pretty clear that the Hollywood cartels are operating under the legal precedent of 'backsies'.

Billboard is reporting about a new copyright infringment suit filed today in New York. From Billboard:

The major record companies have sued XM Satellite Radio over its XM + MP3 service claiming "massive wholesale infringement" of their recordings.

The suit, filed today (May 16) in the federal District Court in New York, calls the service a "digital download" service that has not been properly licensed.

I don't know why, but I'm surprised that the Hollywood cartels would sue XM. Right now there are only two things that drive music sales, iPods and satellite radio. The Hollywood cartels failed when trying to shut down the first MP3 players so they've decided to go after XM.

This is the innovation tax in action. Create a great new product that millions of people want to buy and watch the Hollywood cartels sue you while getting their allies in Congress to make your business illegal.

The Consumer Electronics Association just issued a press release about Senator Feinstein's (D-Hollywood) PERFORM Act.

According to Michael Petricone, CEA's vice president of government affairs, "Satellite radio is one of the great American technology success stories of the 21st century. Sirius and XM provide 11 million Americans with exciting entertainment options, while opening new revenue and promotional opportunities for the record labels. The PERFORM Act will have a severe and harmful impact on these startup companies and their subscribers.

"The bill would suddenly change the rules to increase payments to the record industry, even though XM and Sirius already pay tens of millions in performance royalties to record labels, performers, songwriters and music publishers. Plus, the record labels get additional royalties for every receiver sold under the Audio Home Recording Act. This is in marked contrast to over the air radio broadcasters who make no payments to the record labels."

...

The PERFORM Act also requires government technology mandates to limit the recording capability of new XM and Sirius receivers. "Americans have been making noncommercial recordings off the radio for decades," Petricone pointed out. "This bill would turn back the clock on home recording. Indeed, if this bill applied to video content, your TiVO would be outlawed."

It's about time that the CEA stepped up the the plate and started to fight back.

I was interviewed for Australia's CyberShack radio program. The show can be downloaded here or heard on some US college radio stations.

I talked about our iPod campaign, the IPPA, and a host of other issues. It's worth listening to.

CNET is reporting on a group of tech companies including HP, Intel, and Cicso that have formed the Coalition for Patent Fairness. They understand that patent law has become an innovation tax.

"We are concerned about what we see as the growing imbalance in the application of patent law heavily in favor of plaintiff-as-patent-holder at the expense of patent holders more focused on developing, producing and marketing," Comer said. "Generally, we are interested in improving the way remedies are applied, the way damages are assessed in the courts, and the function in the courts."

...

"The primary focus of this coalition is the litigation abuses that have evolved in the patent system," said Comer. "There are cases in front of courts that are inadequately equipped to deal with the complex questions surrounding the technology of some patent litigation. We are interested in improving the quality of the courts the cases are in front of."

This is a good first step, but we need to reform the patent application and approval process too. Patent trolls exists because the patent office approves everything and lets the courts decided what to do about it. Limiting the judgments and jurisdictions is only a bandaid.

I know it's not a big surprise that the Hollywood cartels pay off radio stations to get their Boy/Girl band of the moment into heavy rotation, but it is against the law.

From the NY Times:

The Universal Music Group, the world's biggest music company, has agreed to pay $12 million to settle accusations that executives paid radio programmers to play songs, according to a settlement announced yesterday. It is the largest settlement yet in an investigation by the New York attorney general that has shaken the music business.

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Last year, the authorities settled with Warner Music Group for $5 million and Sony BMG Music Entertainment for $10 million in similar arrangements. In March, Mr. Spitzer sued one of the nation's biggest radio broadcasters, Entercom Communications, accusing it of trading airplay for money, after settlement discussions faltered.

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The documents say Universal twice paid for hotel accommodations in Miami for Donnie Michaels, then the program director of WFLY-FM in Albany, in exchange for his addition of songs by Brian McKnight and Nick Lachey to his station's playlist. In April 2004, Universal provided Mr. Michaels — by then a programmer at WHYI-FM in Miami — with a New York hotel room and New York Yankees tickets. The company booked the room under a false name and used a false Social Security number to conceal the transaction, the document states.

I'm sure the payola legilization act will be coming out of Congress any day now.

Perhaps the best explanation of net neutrality and why it is important.

Today we kicked off an important campaign aimed at the 2006 elections. We thought long and hard about which candidate we should pick for the first of our targeted races, and we kept coming back to the Senate contest in Utah. We aren't picking this race only because Orrin Hatch is the Hollywood cartels' go-to guy for outrageous legislation, or because he wants to blow up computers used for file sharing. We picked this race because it is a clear example of good vs. evil. Running against Senator Hatch is Pete Ashdown. Pete understands the importance of balanced information policy, that's why he's signed IPac's Statement of Principles. Pete founded the oldest ISP in Utah and even has a wiki on his campaign website so every voter in Utah can contribute ideas to his campaign. Today we launched FireHatch.com so that geeks can contribute money to his campaign, too.

FireHatch.com is an important step for everyone concerned with the Hollywood cartels' control over our Government. Politicians like Hatch have gotten away with selling out their constituents because nobody has held them accountable. If we can force Senator Hatch to answer for his actions, we’ve made it that much harder to sponsor and vote for legislation that would impose an innovation tax on Americans.

I just saw that Senator Ted Stevens (R-Alaska), the inspiration for our iPod campaign, introduced a Net Neutrality bill in the Senate today. Sen. Stevens took this oppertunity to slip the broadcast flag into the bill. From Multichannel:

According to a summary released by the Senate Commerce Committee, the Stevens bill would:
...
Authorize the FCC to establish a broadcast flag to allow TV stations to protect digital content from Internet piracy;There are lots of things going on in this bill, it's 135 pages, but any bill that enables the FCC to implement the Broadcast Flag must be stopped.

This is another tool in the arsenal of the Hollywood cartels. They are attempting to overwhelm the tech community by introducing terrible legislation after terrible legislation hoping that we don't notice or are spread too thin fighting their other bills. This comes right after IPPA (DMCA 2.0) in the House and Senator Feinstein's (D-Hollywood) PERFORM Act in the Senate.

Time to prep those phone calls and emails.

EDIT: Alex Curtis over at Public Knowledge has more on the new legislation including a copy of the actuall bill.

Steven Page of the Barenaked Ladies wrote an Op-Ed for Canada's National Post about Canadian musicians new coalition against the Hollywood cartels' control over music and culture. Page writes:

Much of their lobbying, however, is not about protecting artists or promoting Canadian culture. It is about propping up business models in the recording industry that are quickly becoming obsolete and unsustainable. It is about preserving foreign-based power structures and further entrenching the labels' role as industry gatekeepers. Their lobbying efforts are focused on passing laws that restrict artists' ability to take control of their own music, reach their fans in more direct ways and earn a decent living from music without sacrificing their autonomy.

We, as Canadian music creators, have identified three simple principles that should guide copyright reform and cultural policy.

- First, we believe that suing our fans is destructive and hypocritical. We do not want to sue music fans, and we do not want to distort the law to coerce fans into conforming to a rigid digital market artificially constructed by the major labels.

- Second, we believe that the use of digital locks, frequently referred to as technological protection measures, are risky and counterproductive. We do not support using digital locks to increase the labels' control over the distribution, use and enjoyment of music, nor do we support laws that prohibit circumvention of such technological measures, including Canadian accession to the World Intellectual Property Organization's Internet Treaties. These treaties are designed to give control to major labels and take choices away from artists and consumers. Laws should protect artists and consumers, not restrictive technologies.

Where are American artists? We know that Mettalica and Dr. Dre hate their fans and would rather see them in jail than at one of their concerts, but where are America's real aritsts? Where are the leaders that are willing to stand up to the Hollywood cartels and demand that they stop suing their fans and allow music to be listened to on any device a person owns.

Last week the LA Times ran an editorial about IPac called The iLobby. Here are some highlights:

Formed by technology advocates rankled by the expanding powers of copyright, patent and trademark holders, IPAC (get it?) is but a dust speck in the universe of big-money politics. It donated about $2,000 to candidates in 2004, compared with $5.3 million from entertainment industry groups. IPAC says it has much greater ambitions for the midterm elections, including providing cash to the opponents of three or four Luddite incumbents. Chances are that it won't come close to matching the entertainment industry's star power — who's going to draw more people to a fundraiser, Hollywood starlets or open-source software gurus? — but with any luck its unusual tactics could open some minds in Washington.

...

Nevertheless, there's evidence that IPAC's approach may actually work. At a hearing on anti-piracy legislation this year, Sen. Ted Stevens (R-Alaska), who is 82, revealed that his daughter had recently given him an iPod. He then got into a debate with the head of the Recording Industry Assn. of America over whether he should be able to record songs off the radio for personal use.

That's just the kind of question lawmakers ought to be asking. If owning an iPod is enough to prompt that kind of inquiry, then IPAC should send one to every member of Congress. Maybe it could throw in some TiVos too, along with a few Wi-Fi powered phones. And a 15-year-old kid for tech support.

This is the hometown newspaper of the Hollywood cartels. Every LA executive saw this editorial and has to be worried that IPac exists and is committed to fighting their control in Congress. They have had their draconian legislation passed because there was no organized counter-force. With your help we're going to make a real impact in the November elections and send a message to the Hollywood cartels that their time of exclusive control of Congress is over.