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UK faces Comms Bill disaster because DCMS doesn’t get it

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The government has released a schedule of seminars designed to gather information that will inform the Green Paper that will lead to a new Communications Bill in 2015. The supporting rationale suggests it is bent on solving last century’s issues, not those of a fully digital, hypernetworked, globally competitive economy. In short the department of culture, media and sport (DCMS) just doesn’t get it.

Starting in July delegates will address

Fundamental to the debate is the broadband market in the UK, which underpins everything DCMS would like to happen. The government appears to think this job is done. It is wrong.

It says it “is already investing a total of £830 million by 2015 into improving broadband connectivity in poorly served, mainly rural areas, upgrading mobile infrastructure and establishing some of Europe’s best connected cities. Government must now also consider the other crucial building block of digital infrastructure: spectrum.”

In fact, there is not yet a single live line in the country that has come through the BDUK procurement framework process, which governs the £830m. The nine firms invited to pitch for the business resulted in two  suppliers – BT and Fujitsu – hardly a rampantly competitive scenario.

Furthermore, the European Commission has stalled the release of BDUK’s funds because none of the UK proposals put forward so far meet its target of a universal 30Mbps broadband service by 2020. There has been some movement on this; existing contracts such as Cornwall, which offer “up to” 24Mbps, will be allowed to go ahead, but new ones must meet the 30Mbps target.

Why now?

The timing of the seminars is curious. Not only is DCMS distracted by the Olympics, but the House of Lords communications committee is looking at the broadband issue. It has heard evidence that the fibre to the cabinet solution proposed by both BT and Virgin Media is a technological dead-end, unlikely to meet Europe’s secondary target of 50% of users receiving a 100Mbps service. The committee’s findings and recommendations are unlikely to inform the seminars, but may be out in time for the Green Paper DCMS hopes to publish early in 2013.

Similarly with Ofcom’s business connectivity review. This three-yearly review of the network services available to businesses, such as leased lines and backhaul, will not start before July, an Ofcom spokesman says. Its conclusions, which will assess issues such as competition levels and barriers to entry in this £2bn/y market, are unlikely to be available much before year-end. This leaves little time to absorb and debate them before they are incorporated, or not, in the Green Paper.

Fit for purpose?

It is true that DCMS has some important issues to put to bed. These include online copyright, content creation and protection, and access to content. However, these issues derive from rather than drive the physical networks.

The government appears to believe that the UK has a network infrastructure fit for purpose for the networked age. There is plenty of evidence that this not the case.

At the consumer level there are just two physical networks, BT’s and Virgin Media’s. They presently overlap, duplicating coverage for about 50% of the UK’s houses. It is unlikely that VM will go much further than this for fear of being forced to provide third parties like BT with physical access to its ducts or wholesale access to its fibres and cables.

This is likely to leave BT with an effective fixed network monopoly in the two-thirds of the country where the “Final Third” of the people live. Of course, there are other fixed networks, such as those of Geo, of Cable&Wireless Worldwide, of Vtesse Networks, that criss-cross the country. But they do not offer connections to residential customers. Some, such as Gigaclear, do. But they are very small and their business models fragile.

BT has a product, PIA or physical infrastructure access, that allows third parties access to its poles and ducts. So far only Andy Conibere’s CallFlow Solutions has taken it up. Matthew Hare, CEO of Gigaclear, says CallFlow can do it because it gets its money upfront from customers. Hare has looked at PIA and rejected it. He’s put off not so much by the price (which Fujitsu and Virgin Media say is way higher than cost) but by the terms and conditions.

“You can use PIA only for residential customers,” he says. “BT knows that any viable business plan to service rural areas relies on being able to go to all customers, including businesses,” he says.

That’s not all. Hare says, among other things, you have to disclose your entire roll-out plan, and pay BT to survey the ducts you want to use. “They should know what’s available and what condition it’s in,” he says.

Other firms, such as TalkTalk and Sky, simply rent BT’s local access networks to deliver TV, broadband and voice services to customers. The rent they pay BT, or rather Openreach, ensures that BT still profits from the transaction. This is common practice throughout Europe

Wireless worlds

Then there are the wireless network operators, led by the mobile phone companies (MNOs and MVNOs like Virgin Mobile who rent their entire network infrastructure from Vodafone, Orange, O2 or Three). They are increasingly interested in serving data products to consumers, but preferably only in towns. Besides, they have to rent space on fixed networks to hook up with the UK’s core networks and internet peering points.

This is why Vodafone’s mooted takeover of CWW is a possible game-changer; it gives the mobile operator instant access to a fixed network whose backbone is probably as extensive as BT’s and which could backhaul wireless local access links in competition to BT. It also responds to the £100m, eight year backhaul deal between Virgin Media Business and MBNL, the network company for Everything Everywhere (O2 and Orange) and Three, signed in September 2011.

The only wireless network operator with coverage comparable to BT is Arqiva, whose main job is distributing TV and radio broadcasts. BT and Arqiva are in a joint venture with Detica to compete for the network for the smart meter project that will connect the UK’s 28 million homes and offices.

Content competition

The UK has the world’s second largest independent television production sector, is the second biggest exporter of music, the largest video games industry in Europe, and the fourth largest film market. That suggests the UK’s content businesses are doing all right.

DCMS says the “creative industries” including publishing, contribute 2.5% of GVA (gross value added), about £36bn, and employ 1.5 million people. Ofcom’s Communications Market report for 2011 largely corroborates it. It says TV revenue was up 5.7% to £11.8bn, radio was up 2.8% to £1.1bn, recorded music was down 8.6% to £1.2bn (but legal downloads were up 5% to 24% of sales), advertising was £16bn, 24% of it online, about the same as TV.

But that hides some problems. Publishers and other rights holders worldwide have been stunned by the proliferation and fragmentation of media. Facebook, Twitter, YouTube, Huffington Post, Google, Amazon etc have made mincemeat of business models that depend on high-priced access to exclusive content.

Even so, it is staggering to find DCMS wants to debate “whether convergence in the content market should require a degree of convergence in the telecoms/broadcast competition regimes”. It is hard to know what this actually means. It makes no sense unless it is a veiled threat to the ability of the likes of Google, Amazon, Apple and Sky to do deals that aggregate content and deliver it to customers for a price they are willing to pay.

These firms provide platforms for ordinary people to create and distribute their own content, without bothering cartel-like middlemen like record companies and book publishers.

There are things to be said about excessive market power and abuse of personal information, whose disclosure is often the price paid. But that is a different issue to one that should inform a Communications Bill.

By ignoring the issue of competition at the network infrastructure level, the government is in danger of condemning the UK to a sclerotic digital infrastructure that is not fit for purpose in the 21st century.

By missing or ignoring the fact that the future networks are as much about uploading and sharing as downloading and consuming, the government risks duplicating the content distribution cartels of the previous century.

Let the debate begin.


Why the EU will repent ACTA at leisure

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The 22 European states that signed up to the controversial Anti-counterfeiting Trade Agreement (Acta) last week may have been in an unseemly rush.

They appear to have ignored the recommendation that the European Parliament (EP) postpones ratification of the US-inspired agreement on at least two grounds: firstly, because it does not comply with existing European rules and agreements (acquis) as it stands, and secondly, because the European Court of Justice has not had a chance to evaluate the method for calculating financial damages for copyright infringements.

The haste with which the UK and 21 others joined the US, Australia, Canada, Japan, Mexico, Morocco, New Zealand, Singapore, South Korea and Switzerland may also have led to the resignation of Kader Amir, the Acta rapporteur. Amir was responsible for shepherding the agreement through the EP ratification process, scheduled for June. He quit on the day of the signing, describing the process as a “masquerade“.

The recommendation to postpone is in a 76-page technical assessment ordered by the EP as to whether Acta is compatible with the existing acquis communautaire and the World Trade Organisation’s Trade Related intellectual Property rights (TRIPs) Agreement. (For my highlighted copy see here.)

The authors found plenty that disturbed them. Some of it may be why Germany, the Netherlands, Estonia, Cyprus and Slovakia did not sign up.

They also said it was “difficult to point to any significant advantages that Acta provides for EU citizens beyond the existing international framework”.

“The apparent lack of intent to seek congressional approval and thus actually implement the treaty in US law begs the question of what, if anything, the EU gained from the US. There are serious concerns regarding whether Acta will have any effect under US law and thus be able to be treated as a treaty under international law,” the authors said.

They added that the exclusion of China, India and Brazil (which were apparently not invited to the secret negotiations and which have all raised questions over Acta) meant that major competitors to the EU are not bound by its provisions.

The authors said the EU had won one concession, that Acta signatories would act against faked geographic indicators (GIs). GIs cover brands like Parma ham and Champagne. But counties that do not already protect GIs are not bound by Acta. This exempts the US, Australia, Japan and South Korea, the study said.

The authors found that proposed measures on copyright piracy seen in early leaked documents published on WikiLeaks had been watered down. However, the proposed financial penalties go further than existing EU and international agreements.

“Damages apply not only to a knowing infringement but also to infringement due to negligence,” the report says. “Thus those who could be considered to have reason to know they were or might be infringing, would be liable for damages even if they did not intend to infringe.”

This would appear to nail websites like The Pirate Bay and MegaUpload. These pointed to sites that held infringing material, even though they did not host it themselves. Both have been shut down using other laws.

But it could include search engines such as Google, which index and point to sites that host infringing material. Google is clearly the focus of a secret document, now public after a Open Rights Group Freedom of Information request, that calls for search engines to delist sites that hold infringing material.


Acta provides for judicial authorities to order four types of financial penalties: for the infringer to pay his profits to the rightsholder, to pay pre-established damages, or a presumption of the harm caused by the infringement, or additional damages.

The authors objected to the way in which damages are to be calculated. They said, “The focus is not on objective tests but on any ‘legitimate’ measure of value the rightsholder puts forward.”

The list of measures to be taken into account when assessing damages contains “two novel approaches that are problematic” and not in the existing rules. These are the market price of infringing goods, based on the concept that each infringing product constitutes a lost sale; and the suggested retail price, which they describe as “another proxy for the concept that each infringing product represents a lost sale”.

The authors said, “This latter authority is only mandatory for cases of copyright and trade mark infringement, not for the infringement of designs, patents or geographical indications.”

The authors noted that rightsholders could allege copyright infringements to prevent competitors indefinitely from entering markets. This could include makers of generic drugs (drugs that are out of patent protection), but only in signatories’ markets.

Acta also excluded copying for personal, no-for-profit uses, including “fair use” for study, teaching, new reporting, commentary or criticism, they said. It also sought to criminalise unauthorised copying by anyone.

“(Acta’s) criminal measures (are) most problematic in the field of copyright and related rights, as these cover not only economic actors, but address private individuals in equal measure,” they said.

The authors accepted that it is important to protect intellectual property, but added that “knowledge” has a sell-by date.

They raised questions over who stands to benefit from such protection. The said countries with more established knowledge-based capabilities (ie research-intensive manufacturers, pharmaceuticals, software, or creative products such as music, films, etc) will benefit, not least through enforcement.

“Countries with weaker knowledge-based capabilities are likely to benefit most by being outside such an international system, so they can freely exploit and imitate IP-related products in their own domestic economies,” the authors say.

“Where they are successful, these countries may even be able to compete with the original IP owners, thus becoming exporters of such products themselves.”

From the start Acta has aimed to further the interests of the US music and film industry, almost exclusively. It has been negotiated in secret, with US president Barack Obama stating at one point that it was a US national secret. It does nothing to enhance protections the EU has already secured in public forums, and may severely curtail the ability and capacity for its people to use what is already published for legitimate ends.

Rejecting ratification means that the EU writes off the cost of the negotiations, and possibly some political capital. Accepting it lock, stock and barrel potentially exposes EU citizens to unquantifiable criminal and financial penalties for an indefinite period, while allowing its main economic competitors free reign.

If you were an MEP, what would you do?

Written by Br0kenTeleph0n3

2012/01/29 at 14:55

US nixes site and account blocking in new copyright piracy deal

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US internet service providers and copyright holder bodies yesterday signed a voluntary agreement to notify internet users when their accounts are allegedly used to download copyright material illegally.
Users will receive up to six emails warning of the alleged infringement, but there will be no blocking of websites or user accounts, and ISPs will not give out the names of their account holders.
According to a statement marking the event, content theft costs the US economy more than 373,000 jobs, $16bn in lost earnings, and $3bn in lost taxes. No source was given for these data.
The new Copyright Alert System will start to come into effect later this year.
The signatories are
MPAA and MPAA members: Walt Disney, Paramount, Sony Pictures, Twentieth Century Fox, and Universal Studios and Warner Bros
RIAA and RIAA members: Universal Music, Warner Music, Sony Music, and EMI Music North
ISPs: AT&T, Cablevision, Comcast, Time Warner Cable, and Verizon
IFTA: representing independent producers and distributors of film and
television programming
A2IM: representing 283 music label members, small and medium
sized businesses
It remains to be seen how this agreement will affect content aggregators such as Google, Microsoft and Yahoo, who are not signed up.

Written by Br0kenTeleph0n3

2011/07/08 at 11:59

Oracle sues Google for $6bn over Java on Android smartphones

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Google faces claims for billions of dollars for allegedly infringing Oracle’s patents in the Java programming language that the database company acquired when it bought Sun Microsystems 18 months ago.

A US district court ordered Google to reveal the extent of the damages on Friday, Reuters reported.

Oracle claimed last year that Google’s Android smartphone operating system infringes Java patents. But until now neither party had put a number on the alleged damages.

Oracle America, Inc v. Google Inc, case 10-3561, is being heard in California’s northern district court.

Update: In a subsequent report, Reuters, quoting court papers, put the figure at between $1.4bn and $6.1bn. Google said the sums claimed were out of proportion to the value of the intellectual property at issue.

Written by Br0kenTeleph0n3

2011/06/17 at 11:56

Posted in Legal, News

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Kazakhstan tries to force Google to open local server farm

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Google is resisting Kazakhstan government requests to have searches on done on servers located in the former communist state.

In a statement on Google’s official blog, Bill Coughran, Google’s senior vice president for research & systems infrastructure, said it was told last month that all .kz domain names, such as, had to operate on physical servers within the borders of that country.

This  meant that Google would have to route all searches on to servers inside Kazakhstan, he said. Presently Google handles all search requests the fastest way possible, regardless of national boundaries.

“If we were to operate only via servers located inside Kazakhstan, we would be helping to create a fractured internet. So we have decided to redirect users that visit to in Kazakh. Unfortunately, this means that Kazakhstani users will experience a reduction in search quality as results will no longer be customised for Kazakhstan,” he said.

Written by Br0kenTeleph0n3

2011/06/09 at 00:42

Watershed week for online world

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This week promises to be a watershed for the communications industry. Later today, Swedish Foreign Minister Carl Bildt and Dutch Foreign Minister Uri Rosenthal will leave a crucial European foreign ministers’ summit in Brussels to address a Google-sponsored conference on free expression in the online world. This is a handy kick-off to Tuesday and Wednesday’s e-G8 Forum, which French president Nicholas Sarkozy is hosting ahead of the actual G8 meeting that kicks off  on Thursday. Some critics of the eG8 believe Sarkozy wants a rubber stamp for his “three strikes and out” law for online pirates, which some believe is the thin end of internet censorship. Be that as it may heads of state will be discussing among other things, governance of the internet. Whereas authoritarian governments want to see the internet locked down, the US and EU are fighting to keep its open character. They will do this in the light of the Wikileaks disclosures about how diplomacy works in practice, the Twitter-fueled Arab (and now Spanish) spring, and the furore that surrounds the breaking of an English court injunction on disclosure of a footballer’s extra-marital affair. More ominously, they also face the on-going attack or at least attempts to penetrate critical national infrastructure and key government ministries and private companies. On Wednesday UK communications regulator Ofcom will publish new general conditions and universal service conditions for communications providers. Thursday will see the annual general meeting of Nominet, the private, not-for-profit company that manages the .uk internet domain, among other things. Nominet is under pressure to make it easier for law enforcement agencies to get websites taken off the internet, but there is a heated debate about the grounds for complying with such requests. On a lighter note, Thursday will also see the opening of the Tunny gallery at the National Museum of Computing at Bletchley Park, the famous Station X of the World War Two code breakers. Tunny machines were instrumental in helping the Allies read enemy code.