DECEMBER 2003

Welcome to the Rockbridge Global Village, Inc. Newsletter. We hope that you find information and topics within this newsletter interesting and useful.

Topics in this newsletter:

Spam, Spam, Spam
Judge: Hands Off Internet Phones
VOIP: Here, There, Everywhere
A Whodunit for the Digital Age
Napster: Back Again!

Spam, Spam, Spam
December 11, 2003
By Amit Asaravala

Weaknesses in the United States' first federal antispam law could end up being bad news for Internet users and great news for vendors of antispam products and services, say spam fighters.

The predictions come on the heels of a 392-5 vote Monday by the U.S. House of Representatives in favor of the landmark Can-Spam Act. The act is expected to be approved by President Bush before the end of the month and would set up the first federal regulations on the distribution of commercial e-mail.

However, critics argue that the regulations are full of loopholes that could increase the amount of spam. Some have even begun referring to the bill as the Yes, You Can Spam Act.

"Can-Spam won't work," said researcher and antispam developer William Yerazunis. "It's too easy to hide behind exemption clauses."

Among those clauses is a provision that allows businesses to send out marketing messages as long as they provide a means for consumers to opt out of receiving such messages in the future.

"What it comes down to is that Can-Spam is actually un-canning spam, since it legitimizes spam in the vast majority of cases," added Yerazunis. "I expect the reaction will be that filters will become de rigueur for the next few years."

That sentiment has not been lost on vendors of antispam tools, who say they are expecting record sales next year, partly because of holes in the Can-Spam Act.

"Ultimately, the law is good news for Qurb," said Qurb CEO and founder Felix Lin. "The law will allow legitimate companies to send e-mail to anyone, until that person indicates a desire to opt out. However, individuals have been trained never to unsubscribe from a spammer's mailing list, lest they confirm to spammers that their e-mail address is (an) active account."

Rather than risk confirming their addresses to an illegitimate business, consumers will simply block all messages from unknown senders, said Lin.

To make matters worse, many U.S.-based spammers are expected to take their operations overseas, placing themselves beyond reach of federal laws.

"As long as there is another country for a spammer to move to, the spam will not be reduced," said Audiotrieve CEO Roger Matus. "Can-Spam is a welcome first step, but it will not reduce the amount of spam."

So far, proponents of the Can-Spam Act have dismissed such warnings, saying that they expect the bill to work.

A spokesman for Oregon Sen. Ron Wyden, the lawmaker who sponsored the bill, said Wyden was planning to pursue spammers under the new law "as soon as possible."

But even with vigorous enforcement, the act undermines other efforts to fight spam, activists say. Take, for instance, Yahoo's recently announced plans for authenticating e-mail through the use of "tokens" that are issued to verified senders.

"If a sender complies with the Can-Spam act, there is no legal basis for denying that sender an authentication token, and so any spammer can trivially circumvent authentication," said Yerazunis. "This 'legitimate spam' loophole makes the cryptographic authentication-based systems proposed by VeriSign, F-Secure and CipherTrust meaningless."

E-mail authentication has been hailed by technologists as the only sure solution to the spam problem. Without it, Internet users are likely to be stuck downloading increasing amounts of spam in the coming years.

"The bottom line," said Yerazunis, "is that Can-Spam will make the spam problem much, much worse."

Judge: Hands Off Internet Phones
October 2003
By Reuters

NEW YORK -- A U.S. federal judge rebuffed in strong language Wednesday a move by Minnesota state regulators to force Vonage, a provider of cheap phone calls via the Internet, to comply with rules governing phone companies.

In a decision that could stall efforts by other states to regulate Internet communications, Judge Michael Davis of the U.S. District Court of Minnesota ruled that federal law protects information services from regulation and pre-empts state limits on Voice over Internet Protocol, or VoIP, services.

Vonage, which bills itself as "the broadband phone company," enables computer users with high-speed Internet connections to make and receive phone calls worldwide with a touch-tone telephone for a monthly fee of as little as $35.

"State regulation would effectively decimate Congress's mandate that the Internet remain unfettered by regulation. The court therefore grants Vonage's request for injunctive relief," Davis wrote in his decision published Wednesday.

The decision spelled out the reasoning behind the judge's Oct. 7 ruling to block an effort by the Minnesota Public Utilities Commission to subject Vonage Holdings to the same rules that cover phone company service providers. Vonage has signed up about 500 customers with Minnesota addresses.

The Edison, New Jersey-based company was founded by Jeffrey Citron, a Wall Street stock trading entrepreneur. It has signed up 50,000 customers for its services, which rely on boxes supplied by Cisco Systems to hook phones to the Internet.

Mark Oberlander, telecommunications manager for the Minnesota PUC, said the commission had received the judge's order and was considering its options, but would not disclose its plans until next week. He declined to comment on whether the agency was contemplating an appeal of the U.S. ruling.

"We feel that Vonage is providing telephone service under state law," Oberlander told Reuters. "We seek to apply Minnesota law to Vonage in the same manner we apply the law to any telephone service provider. No more, no less."

The state PUC had sought to force Vonage to comply with requirements that communications service suppliers provide "911" emergency-calling services. It also called on Vonage to pay public service tariffs and register as a phone company.

"This will have a dampening effect on some of the other states seeking to regulate Internet phone calling," said Stewart Baker, head of the global technology law practice of corporate law firm Steptoe & Johnson in Washington, D.C.

Citron, Vonage's chairman and chief executive, said the ruling could have broad application to efforts by other states to regulate Internet phone-calling services.

"It is our belief that those federal rules should apply not only in Minnesota but also in other states," Citron said in a phone interview following the release of the decision.

State regulators in California, Wisconsin, Oregon, New York, Texas and Pennsylvania are considering moves to treat Internet calling services as phone companies, he said.

Still, Baker cautioned that a national precedent could only be secured if a higher court rules on the issue.

"Internet telephony is a hard problem for regulators. It really does have the potential to become a different way of ordinary people getting telephone service," Baker added.

Major U.S. cable television operators are eyeing VoIP services as a way to deliver communications services to their customers and undercut established phone company services.

Seeking to highlight his company's efforts to turn traditional telephone service on its head, Citron said Vonage will introduce next week new software that will allow its customers to make and receive calls from mobile laptops or handheld computers.

A Whodunit for the Digital Age
December 13, 2003
By Kari Dean

It begins with an e-mail sent to the wrong man. Or was it? The misdirected message triggers romance with a stranger. Tension ensues -- then murder.

Perusing the log of messages, a casual reader becomes an unintentional P.I., unraveling the events and solving the mystery through the victim's e-mails and instant-message conversations with her possible killer.

Oh, the intrigue!

Cybersnoops, aspiring Web detectives and electronic voyeurs searching for a new kind of fix might find it in an emerging form of e-book fiction with a twist: the digital epistolary novel, or DEN. Created by Greatamericannovel.com, a DEN reveals its story line through a series of simulated e-mails, Web pages and instant messages.

"E-books spend too much time looking like paper; they need some device," said Eric Brown, a former literature professor and founder of Greatamericannovel.com. "This is the story of stuff we expect to see on the screen. It's compelling and fun."

Upon downloading a DEN from Greatamericannovel.com, a reader advances through the story by clicking through chains of e-mails between main characters. The reader also witnesses instant-messaging conversations in progress, sees which websites the characters visit, and views the wireless text messages they send and receive. Through these simulated communications, the events of the story unfurl.

"I thought of how we go back and forth on e-mail, and sometimes misinterpret, but yet reconnect," said Brown, current president of Communications Associates, a Memphis, Tennessee, consulting firm that also operates the DEN website.

"I started with the idea of the missent e-mail, wrote the story and gave the interface I envisioned to a programmer," Brown said.

And so the DEN, a new e-book genre, was born.

Though work began on the project two years ago, Brown began promoting the first DEN, called "Intimacies," a few weeks ago on several websites. He said his site receives about 1,000 pageviews and 75 DEN downloads daily. Responses on Fark, a discussion site, indicate that readers are eager for more.

While Brown's programmer, Bill McQuown, develops software for other authors to use to create new DENs, Brown is waiting for a potential backer before writing another one. Book publishers, Brown said, have responded with interest, but no deals are on the near horizon.

Brown, however, believes that the DEN offers what the e-book industry has yet to latch onto.

Nick Bogaty, executive director of Open eBook Forum, the electronic-publishing trade organization, concurs that the fledgling industry needs some "device" in order to make a real dent in print and audio book sales. Although e-book industry revenues are growing by about 30 percent annually, electronic book sales currently generate only about $10 million dollars a year, according to the trade group.

"From what I gathered looking at this, it seems to mimic multimedia -- an e-book that begins to go beyond an electronic representation of the printed book," said Bogaty, after previewing Greatamericannovel's sample page.

Bogaty offered no opinion on the literary or technical merits of the DEN experiment, but concurred that e-books must differentiate themselves from their printed counterparts. He speculated that e-books, like DVDs, eventually will contain more special features to encourage buyers to opt for the digital format.

Brown, for his part, acknowledged that the messaging format limits the genre's story line potential. But he was quick to add that every medium has limitations.

"I wanted something that was sort of like popcorn -- just something to grab and go back to what you were doing, not go on forever," he said. "And who doesn't check their personal e-mail at work?"

Brown said he initially conceived the DEN as a "live delivery" that people receive as entertainment to break up the monotony of the day. One DEN fan likens the concept to Majestic, a popular PC game that plays out in a series of daily episodes.

"(The DEN) really fits in our time -- look at reality TV," Brown said. "And who doesn't know the horror story of the missent e-mail?"

The episodic format also works for e-book novices, like Kathleen Ryan, a Chicago English literature teacher who typically avoids e-books because they make her eyes tired and she "can't curl up with it on the sofa." But upon reading "Intimacies," Brown's first DEN, Ryan was surprised by her interest.

"I read it all the way to the end. I needed to know how it ended," Ryan said.

Although she admits the content itself was not very literary -- in keeping with the so-called "popcorn" Brown himself strove to author -- she didn't really mind.

"I could see myself reading a few more. But then I guess it would probably get old after a while," she said.

Rockbridge Global Village, Inc.
312 S. Main Street
Lexington, VA 24450
540-463-4451
www.rockbridge.net