History > 2012 > USA > Internet (II)

Patrick Leger

I Didn’t Write That

NYT

3 November 2012

http://www.nytimes.com/2012/11/04/opinion/sunday/i-didnt-write-that.html

 

Outmaneuvered at Their Own Game,

Antivirus Makers Struggle to Adapt

December 31, 2012
The New York Times
By NICOLE PERLROTH

SAN FRANCISCO — The antivirus industry has a dirty little secret: its products are often not very good at stopping viruses.

Consumers and businesses spend billions of dollars every year on antivirus software. But these programs rarely, if ever, block freshly minted computer viruses, experts say, because the virus creators move too quickly. That is prompting start-ups and other companies to get creative about new approaches to computer security.

“The bad guys are always trying to be a step ahead,” said Matthew D. Howard, a venture capitalist at Norwest Venture Partners who previously set up the security strategy at Cisco Systems. “And it doesn’t take a lot to be a step ahead.”

Computer viruses used to be the domain of digital mischief makers. But in the mid-2000s, when criminals discovered that malicious software could be profitable, the number of new viruses began to grow exponentially.

In 2000, there were fewer than a million new strains of malware, most of them the work of amateurs. By 2010, there were 49 million new strains, according to AV-Test, a German research institute that tests antivirus products.

The antivirus industry has grown as well, but experts say it is falling behind. By the time its products are able to block new viruses, it is often too late. The bad guys have already had their fun, siphoning out a company’s trade secrets, erasing data or emptying a consumer’s bank account.

A new study by Imperva, a data security firm in Redwood City, Calif., and students from the Technion-Israel Institute of Technology is the latest confirmation of this. Amichai Shulman, Imperva’s chief technology officer, and a group of researchers collected and analyzed 82 new computer viruses and put them up against more than 40 antivirus products, made by top companies like Microsoft, Symantec, McAfee and Kaspersky Lab. They found that the initial detection rate was less than 5 percent.

On average, it took almost a month for antivirus products to update their detection mechanisms and spot the new viruses. And two of the products with the best detection rates — Avast and Emsisoft — are available free; users are encouraged to pay for additional features. This despite the fact that consumers and businesses spent a combined $7.4 billion on antivirus software last year — nearly half of the $17.7 billion spent on security software in 2011, according to Gartner.

“Existing methodologies we’ve been protecting ourselves with have lost their efficacy,” said Ted Schlein, a security-focused investment partner at Kleiner Perkins Caufield & Byers. “This study is just another indicator of that. But the whole concept of detecting what is bad is a broken concept.”

Part of the problem is that antivirus products are inherently reactive. Just as medical researchers have to study a virus before they can create a vaccine, antivirus makers must capture a computer virus, take it apart and identify its “signature” — unique signs in its code — before they can write a program that removes it.

That process can take as little as a few hours or as long as several years. In May, researchers at Kaspersky Lab discovered Flame, a complex piece of malware that had been stealing data from computers for an estimated five years.

Mikko H. Hypponen, chief researcher at F-Secure, called Flame “a spectacular failure” for the antivirus industry. “We really should have been able to do better,” he wrote in an essay for Wired.com after Flame’s discovery. “But we didn’t. We were out of our league in our own game.”

Symantec and McAfee, which built their businesses on antivirus products, have begun to acknowledge their limitations and to try new approaches. The word “antivirus” does not appear once on their home pages. Symantec rebranded its popular antivirus packages: its consumer product is now called Norton Internet Security, and its corporate offering is now Symantec Endpoint Protection.

“Nobody is saying antivirus is enough,” said Kevin Haley, Symantec’s director of security response. Mr. Haley said Symantec’s antivirus products included a handful of new technologies, like behavior-based blocking, which looks at some 30 characteristics of a file, including when it was created and where else it has been installed, before allowing it to run. “In over two-thirds of cases, malware is detected by one of these other technologies,” he said.

Imperva, which sponsored the antivirus study, has a horse in this race. Its Web application and data security software are part of a wave of products that look at security in a new way. Instead of simply blocking what is bad, as antivirus programs and perimeter firewalls are designed to do, Imperva monitors access to servers, databases and files for suspicious activity.

The day companies unplug their antivirus software is still far off, but entrepreneurs and investors are betting that the old tools will become relics.

“The game has changed from the attacker’s standpoint,” said Phil Hochmuth, a Web security analyst at the research firm International Data Corporation. “The traditional signature-based method of detecting malware is not keeping up.”

Investors are backing a new crop of start-ups that turn the whole notion of security on its head. If it is no longer possible to block everything that is bad, the thinking goes, then the security companies of the future will be the ones whose software can spot unusual behavior and clean up systems once they have been breached.

The hottest security start-ups today are companies like Bit9, Bromium, FireEye and Seculert that monitor Internet traffic, and companies like Mandiant and CrowdStrike that have expertise in cleaning up after an attack.

Bit9, which received more than $70 million in financing from top venture firms like Kleiner Perkins and Sequoia Capital, uses an approach known as whitelisting, allowing only traffic that the system knows is innocuous.

McAfee acquired Solidcore, a whitelisting start-up, in 2009, and Symantec’s products now include its Insight technology, which is similar in that it does not let any unknown files run on a machine.

McAfee’s former chief executive, David G. DeWalt, was rumored to be a contender for the top job at Intel, which acquired McAfee in 2010. Instead, he joined FireEye, a start-up with a system that isolates a company’s applications in virtual containers, then looks for suspicious activity in a sort of digital petri dish before deciding whether to let traffic through.

The company has received more than $35 million in financing from Norwest, Sequoia Capital and In-Q-Tel, the venture arm of the Central Intelligence Agency, among others.

Seculert, an Israeli start-up, approaches the problem somewhat differently. It looks at where threats are coming from — the command and control centers used to coordinate attacks — to give governments and businesses an early warning system.

As the number of prominent online attacks rises, analysts and venture capitalists are betting that corporate spending patterns will change.

“Technologies that once were only used by very sensitive industries like finance are moving into the mainstream,” Mr. Hochmuth said. “Very soon, if you are not running these technologies and you’re a security professional, your colleagues and counterparts will start to look at you funny.”

Companies have started working from the assumption that they will be hacked, Mr. Hochmuth said, and that when they are, they will need top-notch cleanup crews.

Mandiant, which specializes in data forensics and responding to breaches, has received $70 million from Kleiner Perkins and One Equity Partners, JPMorgan Chase’s private investment arm.

Two McAfee executives, George Kurtz and Dmitri Alperovitch, left to start CrowdStrike, a start-up that offers a similar forensics service. Less than a year later, they have already raised $26 million from Warburg Pincus.

If and when antivirus makers are able to fortify desktop computers, chances are the criminals will have already moved on to smartphones.

In October, the F.B.I. warned that a number of malicious apps were compromising Android devices. And in July, Kaspersky Lab discovered the first malicious app in Apple’s app store. The Defense Department has called for companies and universities to find ways to protect mobile devices from malware. McAfee, Symantec and others are working on solutions, and Lookout, a start-up whose products scan apps for malware and viruses, recently raised funding that valued it at $1 billion.

“The bad guys are getting worse,” Mr. Howard of Norwest said. “Antivirus helps filter down the problem, but the next big security company will be the one that offers a comprehensive solution.”

    Outmaneuvered at Their Own Game, Antivirus Makers Struggle to Adapt, NYT, 31.12.2012,
    http://www.nytimes.com/2013/01/01/technology/
    antivirus-makers-work-on-software-to-catch-malware-more-effectively.html

The Hell of Online Shopping

December 23, 2012
The New York Times
By DELIA EPHRON

A FEW days ago, I got an e-mail from my sister Amy in Los Angeles saying she and her husband had received boxes from J. Crew. Christmas presents from me, she assumed, since I had ordered them online and told her to expect them.

But for whom, she asked? The cards were buried deep in the packaging, and one of them was missing. Nothing was gift-wrapped, either (although I had requested and paid for it). The boxes contained two pairs of shoes (although I had ordered only one pair), a man’s pullover and a sparkly pink woman’s sweater. The sweater was for a friend who also lives in Los Angeles, but somehow ended up being sent to Amy’s husband.

I called J. Crew to complain, and what followed was tedious and time-consuming, as all Internet dramas are, involving a review of numerous e-mails — “your order has been received,” “your order has been shipped” — in this case to the wrong place and in the wrong ways, some of which I might have prevented if I’d been vigilant tracking the flurry of e-mails.

The customer-service representative, consulting records, assured me that the box for my friend had been delivered. It had been left at the front door, she said, and gave me the address, which turned out to be not my sister and her husband’s house but my friend’s office, a gigantic building in Beverly Hills. “Left outside the front door? Are you sure?”

“Yes,” she said, and, as an apology, she would send me a $50 gift card. I e-mailed my friend. Had she received a box from J. Crew? “No,” she said.

My sister offered to gift-wrap and deliver my friend’s present. This was especially kind because traffic in Los Angeles is awful, as bad as New York’s during the holidays, which is one reason I order on the Web. But rather than make life easier, Web shopping only complicates it in new, more frustrating ways.

My husband, in charge of buying for all the children in our life, announced one evening that he had bought all his presents. To be done with Christmas shopping was so exciting that you’d think he’d used up some calories to do it, when in fact he’d never left his desk. The next morning he got an e-mail from Hammacher Schlemmer saying the item was out of stock and would ship after Jan. 1. So he had to phone and cancel the order. He then had to Web-shop all over again.

When I ordered the presents on the J. Crew Web site and checked a box for the gift-wrapping, I received a message back that J. Crew did not wrap shoes, my sister’s present. As Amy and I were sorting things out, I wondered why in the world I thought it was O.K. to send a Christmas present that wasn’t gift-wrapped.

It seems to me — a fact I had completely forgotten — that a Christmas present should be wrapped in pretty paper, maybe with some Santas dancing across it, maybe something glossy and glamorous. Shouldn’t the tag be handwritten? Shouldn’t the ribbon be made of paper that curls when you whip it across a scissor blade? A present should beckon you. Who wants a Christmas tree with a bunch of U.P.S. boxes under it?

Last week a U.P.S. box arrived. I opened it, and inside, unwrapped, was a slate cheese board and a gift card that said, in computer script, “Merry Christmas Julia and Jerry, love Anna.”

Anna is my niece. Jerry is my husband. I assume that I am Julia.

Precious holiday giving cannot be entrusted to a Web site. A gift shouldn’t be something you open by accident — hello, what is this? — ripping open the cardboard outer box with a knife, and then having your present fall out naked.

Ordering Christmas presents on the Web, regardless of the dubious ease, has obliterated the idea that there should be some grace to a present, some beauty, and that the receiver should experience it. Instead it’s become as mundane and problematic as all our Web purchases, which in my family include paper towels and toilet paper.

All this joy of Internet shopping was accompanied by our phone ringing several times a day: a computer voice from Virgin America insisting that my husband owes $70 — a $50 credit-card fee and $20 interest for not paying it. My husband has never had a Virgin America credit card. But to “proceed,” as in clear the problem up, the electronic voice asked him to identify himself by giving the number of the credit card that he does not possess. The telephone, which used to symbolize “reach out and touch someone” — remember that tear-jerking TV ad? — has become a disembodied voice reaching out to drive us crazy.

But I digress. Or do I? It all seems related. Intimacy replaced by expedience.

So this is my New Year’s resolution: I am never ordering another Christmas present on the Web again. Next year I am wrapping all my gifts myself and standing in line at the local post office for an hour or two to mail them. It’s the least I can do for the people I love.

Delia Ephron is the author, most recently, of the novel “The Lion Is In.”

    The Hell of Online Shopping, NYT, 23.12.2012,
    http://www.nytimes.com/2012/12/24/opinion/the-hell-of-online-shopping.html

Retailers Try to Adapt to Device-Hopping Shoppers

December 21, 2012
The New York Times
By CLAIRE CAIN MILLER and STEPHANIE CLIFFORD

Ryan O’Neil, a Connecticut government employee, was in the market to buy a digital weather station this month. His wife researched options on their iPad, but even though she found the lowest-price option there, Mr. O’Neil made the purchase on his laptop.

“I do use the iPad to browse sites,” Mr. O’Neil said, but when it comes time to close the deal, he finds it easier to do on a computer.

Many online retailers had visions of holiday shoppers lounging beneath the Christmas tree with their mobile devices in hand, making purchases. The size of the average order on tablets, particularly iPads, tends to be bigger than on PCs. So retailers poured money and marketing into mobile Web sites and apps with rich images and, they thought, easy checkout.

But while visits to e-commerce sites and apps on tablets and phones have nearly doubled since last year, consumers like Mr. O’Neil are more frequently using multiple devices to shop. In many cases, they are more comfortable making the final purchase on a computer, with its bigger screen and keyboard. So retailers are trying to figure out how to appeal to a shopper who may use a cellphone to research products, a tablet to browse the options and a computer to buy.

“I’ve been yelling at customers for two years, saying, ‘Mobile, mobile, mobile,’ ” said Jason Spero, director of mobile sales and strategy at Google. “But the funny thing is, now we’re going to say: ‘Don’t put mobile in a silo. It’s also about the desktop.’ ”

The challenges are daunting, though. It is technically difficult to track consumers as they hop from phone to computer to tablet and back again. This means customers who, say, fill shopping carts on their tablets have to do all the work again on their PCs or other devices. The biggest obstacle, retailers say, is that the tools used to track shoppers on computers — cookies, or bundles of data stored in Web browsers — don’t transfer across devices.

Instead, retailers are figuring out how to sync the experience in other ways, like prompting shoppers to log in on each device. And being able to track people across devices gives retailers more insight into how they shop.

The retailers’ efforts are backed by research. While one-quarter of the visits to e-commerce sites occur on mobile devices, only around 15 percent of purchases do, according to data from I.B.M. According to Google, 85 percent of online shoppers start searching on one device — most often a mobile phone — and make a purchase on another.

At eBags, customers are shopping on their tablets in the evening and returning on their work computers the next day. But eBags has not yet synced the shoppers across devices, so customers must build their shopping carts from scratch if they switch devices.

“That is a blind spot with a lot of sites,” said Peter Cobb, co-founder of eBags. “It is a requirement moving forward.”

At eBay, one-third of the purchases involve mobile devices at some point, even if the final purchase is made on a computer.

At eBay, once shoppers log in on a device, they do not need to log in again. Their information, like shipping and credit card details and saved items, syncs across all their devices. If an eBay shopper is interested in a certain handbag, and saves that search on a computer, eBay will send alerts to her cellphone when a new handbag arrives or an auction is about to end.

“They might discover an item on a phone or tablet, do a saved-search push alert later on some other screen and eventually close on the Web site,” said Steve Yankovich, who runs eBay Mobile. “People are buying and shopping and consuming potentially every waking moment of the day.”

ModCloth, an e-commerce site for women’s clothes, said that while a quarter of its visits come from mobile devices, people are not yet buying there in the same proportion, though they are becoming more comfortable with checking out on those devices.

“She’s visiting us more on the phone, but she’s actually transacting somewhere else,” said Sarah Rose, vice president of product at ModCloth.

For example, a shopper will skim through new arrivals on her phone while on the bus and add items to her wish list, then visit that evening on her tablet to make a purchase, Ms. Rose said.

To take advantage of this behavior, ModCloth urges shoppers to log in after just a few clicks on the Web site on a phone or computer, so information like credit card numbers and items saved in a shopping cart on another device are accessible. Then if a laptop shopper adds a skirt to her shopping cart and later, it is about to sell out, ModCloth can send her an e-mail, which she will often click on her phone to buy the skirt, Ms. Rose said. Logged-in users who visit the site using multiple devices are 2.5 times more likely to place an order than those on a single device, according to the company.

On Etsy, where 25 percent of the visits but 20 percent of the sales come from mobile devices, the site syncs items in the shopping cart, favorite items, purchasing history and conversations with sellers.

Many other e-commerce sites, however, still lack an easy way for shoppers to use different devices.

The New York Times logged in to the Web sites of some large retailers and added items to the shopping cart, then logged in to the mobile site or app to see if the cart was reflected there.

Amazon.com, Nordstrom, Target, Macy’s and Gap showed items across devices. Walmart did, too, though with some hiccups; it required logging out of and back into the mobile site to update the cart, and on the app, a shopper had to choose the “sync with online cart” option.

Others, though, did not sync across devices, including Newegg, Kohl’s, RadioShack and J. Crew, so shopping on a different device required filling the shopping cart from scratch.

Newegg is working on syncing the shopping carts, said Soren Mills, its chief marketing officer, because customers are asking for that. The information gleaned about customers that way is also critical for retailers, he said, so they can personalize sites and offers based on consumers’ browsing and purchase history.

“We have to recognize the customer, so we look to get a single view of the customer,” he said.

Retailers could use information like this to show different ads to shoppers with cellphones standing in a store at lunch hour than to those using a tablet at 9 p.m., Mr. Spero at Google said.

Despite the hesitance of shoppers like Mr. O’Neil to buy on mobile devices, some technology industry analysts say people just need time to grow comfortable with new technology.

“It’s just like in the old days, 15 years ago, the conversation was people are researching what they want on their PCs but still going to the store to buy,” said Marc Andreessen, a venture capitalist. Mr. Andreessen is involved with e-commerce companies like eBay and Fab, both of which he said had strong mobile sales. “I think that’s a temporary phenomenon.”

    Retailers Try to Adapt to Device-Hopping Shoppers, NYT, 21.12.2012,
    http://www.nytimes.com/2012/12/22/technology/as-shoppers-hop-from-tablet-to-pc-to-phone-retailers-try-to-adapt.html

Rape Case Unfolds on Web and Splits City

December 16, 2012
The New York Times
By JULIET MACUR and NATE SCHWEBER

STEUBENVILLE, Ohio

HOURS AFTER SUNSET, the cars pulled up, one after another, bringing dozens of teenagers from several nearby high schools to an end-of-summer party in August in a neighborhood here just off the main drag.

For some of the teenagers, it would be one last big night out before they left this decaying steel town, bound for college.

For others, it was a way to cap off a summer of socializing before school started in less than two weeks. For the lucky ones on the Steubenville High School football team, it would be the start of another season of possible glory as stars in this football-crazy county.

Some in the crowd, which would grow to close to 50 people, arrived with beer. Those who did not were met by cases of it and a makeshift bar of vodka, rum and whiskey, all for the taking, no identification needed. In a matter of no time, many of the partygoers — many of them were high school athletes — were imbibing from red plastic cups inside the home of a volunteer football coach at Steubenville High at what would be the first of several parties that night.

“Huge party!!! Banger!!!!” Trent Mays, a sophomore quarterback on Steubenville’s team, posted on Twitter, referring to one of the bashes that evening.

By sunrise, though, some people in and around Steubenville had gotten word that the night of fun on Aug. 11 might have taken a grim turn, and that members of the Steubenville High football team might have been involved. Twitter posts, videos and photographs circulated by some who attended the nightlong set of parties suggested that an unconscious girl had been sexually assaulted over several hours while others watched. She even might have been urinated on.

In one photograph posted on Instagram by a Steubenville High football player, the girl, who was from across the Ohio River in Weirton, W.Va., is shown looking unresponsive as two boys carry her by her wrists and ankles. Twitter users wrote the words “rape” and “drunk girl” in their posts.

Rumors of a possible crime spread, and people, often with little reliable information, quickly took sides. Some residents and others on social media blamed the girl, saying she put the football team in a bad light and put herself in a position to be violated. Others supported the girl, saying she was a victim of what they believed was a hero-worshiping culture built around football players who think they can do no wrong.

On Aug. 22, the possible crime made local news when the police came forward with details: two standout Steubenville football players — Mays, 16, from Bloomingdale, Ohio, and Ma’lik Richmond, 16, from Steubenville — were arrested and later charged with raping a 16-year-old girl and kidnapping her by taking her to several parties while she was too drunk to resist.

The case is not the first time a high school football team has been entangled in accusations of sexual assault. But the situation in Steubenville has another layer to it that separates it from many others: It is a sexual assault accusation in the age of social media, when teenagers are capturing much of their lives on their camera phones — even repugnant, possibly criminal behavior, as they did in Steubenville in August — and then posting it on the Web, like a graphic, public diary.

Within days of the possible sexual assault, an online personality who often blogs about crime zeroed in on those public comments and photographs and injected herself into the story, complicating it and igniting ire in the community. She posted the information on her site and wrote online that the police and town officials were giving the football players special treatment.

The city’s police chief begged for witnesses to come forward, but received little response. In time, the county prosecutor and the judge in charge of handling crimes by juveniles recused themselves from the case because they had ties to the football team.

“It’s a very, very small community here,” said Jefferson County Juvenile Judge Samuel W. Kerr, who recused himself. His granddaughter dated one of the football players initially linked to the incident. “Everybody knows everybody.”

After more than two months in jail, they are under house arrest on rape charges, awaiting a trial that has been set for Feb. 13. Mays, a star wrestler, also faces a charge of disseminating nude photographs of a minor. The kidnapping charges were dropped.

The parents of the boys, who declined requests for extended interviews, said that the boys were innocent. The boys’ lawyers assert that the boys have been tried unfairly online, and vow they will be exonerated when all the facts are known.

The case has entangled dozens of people in and out of this town.

Three Steubenville High School athletes became witnesses for the prosecution and testified against Mays and Richmond, their friends, at a probable cause hearing in October. The crime blogger and more than a dozen people who posted comments on her Web site have been sued by a Steubenville football player and his parents for defamation. The girl’s mother, in several brief interviews last month, said her family had received threats, so extra police have been patrolling her neighborhood.

“The thing I found most disturbing about this is that there were other people around when this was going on,” Steubenville Police Chief William McCafferty said of the events that unfolded. “Nobody had the morals to say, ‘Hey, stop it, that isn’t right.’

“If you could charge people for not being decent human beings, a lot of people could have been charged that night.”

A Bright Spot in Steubenville

Steubenville is an industrial city in Appalachia — locals love to note it is hometown to the Rat Pack crooner Dean Martin, the porn actress Traci Lords and the oddsmaker Jimmy Snyder, known as Jimmy the Greek. The city once was teeming with so much gambling, prostitution and organized crime that Steubenville was given the nickname Sin City. But now the downtown is a skeleton of its former self: though the Steubenville visitors center sells life-size cutouts of Dean Martin and “Dino Lives!” T-shirts, many stores are abandoned, boarded up long ago.

The Grand Theater, once a lavish Art Deco movie house, last showed a film in 1979. Around the corner, Denmark’s women’s clothing store is now a graveyard for discarded hangers and broken clothing racks. In the window of the store is a dusty Woman’s Home Companion magazine from 1948, just about the time Steubenville began its long and painful turn for the worse.

The steel mills that used to employ thousands and draw people here have all but ground to a halt, and the once-plentiful jobs in the coal mines are dwindling. The lack of jobs scared off residents at such a frenzied pace that Steubenville had by far the steepest decline in population of any metropolitan area in Ohio from 1970 through 2000, according to a study by Ohio State University.

And among those who have stayed — about 18,400 in Steubenville — many are struggling. The median household income is $33,188, about a third lower than the national figure. More than one quarter of the residents are living below the poverty level. Also, the police say the city’s drug problems are growing, with heroin addiction the latest vice. In recent decades, new residents arrived from Chicago, bringing “Chicago-style violence,” like drive-by shootings in the tough parts of town, said McCafferty, the police chief.

Despite all those components to this depressed city, a bright light remains for the people here: the Steubenville Big Red football team.

The team recorded its first season in 1900 and quickly became a legend in Ohio high school football. It has won nine state championships, including back-to-back undefeated seasons in 2005 and 2006.

Some former players call it a highlight of their lives to play at Harding Stadium, a gleaming shrine to football also called Death Valley. The stands seat 10,000, more than half the town’s population, and the home side is packed every game, sometimes so packed that it is standing room only. Tailgating in nearby parking lots usually begins about 9 a.m. for a 7:30 p.m. game. Several years ago, Halloween trick-or-treating was postponed because it fell on game day.

Inside the stadium, a big thrill for fans is seeing a sculpture of a rearing red stallion called Man O’War shoot a six-foot flame from its mouth, marking each time Big Red scores.

The team’s Web site declares that Big Red is “Keeping Steubenville on the map.” That is probably true.

“Everybody around here goes to games on Friday nights, and I mean everybody — people come for miles,” said Jim Flanagan, 48, who grew up in the area. “It’s basically the small-town effect. People live and die based on Big Red because they usually win and it makes everybody feel good about themselves when times are tough.”

But emphatic pride over high school athletes, Flanagan said, has turned into something that can feel ugly.

“The players are considered heroes, and that’s pretty pathetic, because they’ve been able to get away with things for years because of it,” Flanagan said. “Everyone just looks the other way.”

A Night Takes a Grim Turn

Just before 10 a.m. on Aug. 11, fans who are part of what is called the Big Red Nation poured into Harding Stadium clad in the team’s colors, red and black, to see Big Red’s second scrimmage of the season and to get a sense of how the team would fare this year.

What they saw were two players who stood out from the rest: Mays and Richmond.

Mays, who hails from a nearby town and who went to Steubenville High because of its successful football and wrestling programs, showed off his strong arm at quarterback. Richmond, who the police say came from a troubled home and has lived in Steubenville with guardians since he was 8, dominated as a quick and tall wide receiver. He also was a star of the Big Red basketball and track teams.

The two athletes gave hope to fans that Big Red might be headed back to the top.

Of Mays, one person at the time wrote on JJHuddle.com, a Web site for Ohio high school sports, “If he has the composure, could be very enjoyable to watch that young man grow up with Ma’lik.” Mays and Richmond helped Big Red prevail that day in the scrimmage, before heading off to a night of parties.

Across the river, in a well-kept two-story colonial house in a solidly middle-class West Virginia neighborhood, the 16-year-old girl told her parents that she was going to a sleepover at a friend’s house that night. She then headed off to those parties, too.

She is not a Steubenville High student; she attended a smaller, religion-based school, where she was an honor student and an athlete.

At the parties, the girl had so much to drink that she was unable to recall much from that night, and nothing past midnight, the police said. The girl began drinking early on, according to an account that the police pieced together from witnesses, including two of the three Steubenville High athletes who testified in court in October. By 10 or 10:30 that night, it was clear that the dark-haired teenager was drunk because she was stumbling and slurring her words, witnesses testified.

Some people at the party taunted her, chanted and cheered as a Steubenville High baseball player dared bystanders to urinate on her, one witness testified.

About two hours later, the girl left the party with several Big Red football players, including Mays and Richmond, witnesses said. They stayed only briefly at a second party before leaving for their third party of the night. Two witnesses testified that the girl needed help walking. One testified that she was carried out of the house by Mays and Richmond while she “was sleeping.”

She woke up long enough to vomit in the street, a witness said, and she remained there alone for several minutes with her top off. Another witness said Mays and Richmond were holding her hair back.

Afterward, they headed to the home of one football player who has now become a witness for the prosecution. That player told the police that he was in the back seat of his Volkswagen Jetta with Mays and the girl when Mays proceeded to flash the girl’s breasts and penetrate her with his fingers, while the player videotaped it on his phone. The player, who shared the video with at least one person, testified that he videotaped Mays and the girl “because he was being stupid, not making the right choices.” He said he later deleted the recording.

The girl “was just sitting there, not really doing anything,” the player testified. “She was kind of talking, but I couldn’t make out the words that she was saying.”

At that third party, the girl could not walk on her own and vomited several times before toppling onto her side, several witnesses testified. Mays then tried to coerce the girl into giving him oral sex, but the girl was unresponsive, according to the player who videotaped Mays and the girl.

The player said he did not try to stop it because “at the time, no one really saw it as being forceful.”

At one point, the girl was on the ground, naked, unmoving and silent, according to two witnesses who testified. Mays, they said, had exposed himself while he was right next to her.

Richmond was behind her, with his hands between her legs, penetrating her with his fingers, a witness said.

“I tried to tell Trent to stop it,” another athlete, who was Mays’s best friend, testified. “You know, I told him, ‘Just wait — wait till she wakes up if you’re going to do any of this stuff. Don’t do anything you’re going to regret.’ ”

He said Mays answered: “It’s all right. Don’t worry.”

That boy took a photograph of what Mays and Richmond were doing to the girl. He explained in court how he wanted her to know what had happened to her, but he deleted it from his phone, he testified, after showing it to several people.

The girl slept on a couch in the basement of that home that night, with Mays alongside her before he took a spot on the floor.

When she awoke, she was unaware of what had happened to her, she has told her parents and the police. But by then, the story of her night was already unfolding on the Internet, on Twitter and via text messages. Compromising and explicit photographs of her were posted and shared.

Within a day, a family member in town shared with the girl’s parents more disturbing visuals: a photograph posted on Instagram of their daughter who looked passed out at a party and a YouTube video of a former Steubenville baseball player talking about a rape. That former player, who graduated earlier this year, also posted on Twitter, “Song of the night is definitely Rape Me by Nirvana,” and “Some people deserve to be peed on,” which was reshared on Twitter by several people, including Mays.

The parents then notified the police and took their daughter to a hospital. At 1:38 a.m. on Aug. 14, the girl’s parents walked into the Steubenville police station with a flash drive with photographs from online, Twitter posts and the video on it. It was all the evidence the girl’s parents had, leaving the police with the task of filling in the details of what had happened that night. The police said the case was challenging partly because too much time had passed since the suspected rape. By then, the girl had taken at least one shower and might have washed away evidence, said McCafferty, the police chief. He added that it also was too late for toxicology tests to determine if she had been drugged.

“My daughter learned about what had happened to her that night by reading the story about it in the local newspaper,” the girl’s mother said.

“How would you like to go through that as a mother, seeing your daughter, who is your entire world, treated like that?” the mother said. “It was devastating for all of us.”

Mays and Richmond were arrested Aug. 22, about a week after the girl’s parents reported the suspected rape.

Taking Sides on Blogs

Alexandria Goddard, a 45-year-old Web analyst who once lived in Steubenville and writes about national crime on a blog, heard about the case early on and rushed to investigate it herself. She told The Cleveland Plain Dealer in September that she did so because she had little faith that the authorities would do a thorough job.

Before many of the partygoers could delete their posts, photographs or videos, she took screen shots of them, posting them on her site, Prinniefied.com. On Aug. 24, just after the arrests, she wrote on her site that it was “a slam dunk case” because, she said, Mays and Richmond videotaped and photographed their crime and then posted those images on the Web. Goddard pressed her case.

“What normal person would even consider that posting the brutal rape of a young girl is something that should be shared with their peers?” she wrote. “Do they think because they are Big Red players that the rules don’t apply to them?”

She cited by name several current and former Steubenville athletes, accusing them of having a criminal role in the suspected assault by failing to stop it and then disseminating photographs of it. According to court documents, Goddard responded to a comment that read, “Students by day ...gang rape participants by night” by writing that the football coach should be ashamed of letting players linked to the incident remain on the field. In another post, she added, “Why aren’t more kids in jail. They all knew.”

Of the Big Red athletes who were with Mays and Richmond that night, she said: “No, you are not stars. You are criminals who are walking around right now on borrowed time.”

Anonymous commenters on her blog took aim at Steubenville High, its football coaching staff and the local police for not disciplining more players or making more arrests in connection with the rape accusation. On another site, Change.org, a person started a petition demanding that the school and the coach publicly apologize to the girl. The petition also asked that the Steubenville schools superintendent admit that there was a “rape culture and excessive adulation of male athletes” at Steubenville High.

In a day, 100 people signed the petition, and 169 signed before no more signatures were accepted.

Around town, the discussion of what might have happened that night in August raged, growing more heated by the day. The accusations on Goddard’s blog, posted by Goddard and others, sparked more debate. The local newspaper, The Herald-Star, ran a letter to the editor from Joe Scalise, a Steubenville resident, who criticized the blogger’s site, saying it “has lent itself to character assassination and has begun to resemble a lynch mob.”

Even without much official public information about the night, some people in town are skeptical of the police account, like Nate Hubbard, a Big Red volunteer coach.

As he stood in the shadow of Harding Stadium, where he once dazzled the crowd with his runs, Hubbard gave voice to some of the popular, if harsh, suspicions.

“The rape was just an excuse, I think,” said the 27-year-old Hubbard, who is No. 2 on the Big Red’s career rushing list.

“What else are you going to tell your parents when you come home drunk like that and after a night like that?” said Hubbard, who is one of the team’s 19 coaches. “She had to make up something. Now people are trying to blow up our football program because of it.”

There is no shortage of people who feel the opposite. They absolutely accept the account of sexual assault, and are weary of what they call the protection and indulgence afforded the football team. That said, more than a dozen people interviewed last month who were critical of the football team and its protected status, real or perceived, did not want their names used in connection with comments about the team, for fear of retribution from Big Red football fans.

One man said he wanted to see the accused boys go to prison, but insisted he remain anonymous because he did not want his house to be a target for vandalism.

Bill Miller, a painter who played for Big Red in the 1980s, said the coach was to blame because he was too lenient with players regarding bad behavior off the field.

“There’s a set of rules that don’t apply to everybody,” he said of what he called the favoritism regarding the players. “This has been happening since the early ’80s; this is nothing new. It’s disgusting. I can’t stand it. The culture is not what it should be. It’s not clean.”

Others attacked Goddard, the crime blogger, for her commentary regarding what she called the town’s twisted football culture and its special treatment of football players, including a player who is suing her for defamation. As part of the legal action against her by the player and his family, the court has allowed the family’s lawyers to seek the identities of those people who disparaged the player by name on the blog. The player has not been charged with any crime.

Goddard, who has not been located by the court so it can serve her with a copy of the complaint, did not respond to an e-mailed request for comment. She remains active on her blog.

Goddard’s lawyers, Thomas G. Haren and Jeffrey M. Nye, said that their client was a journalist whose work was protected by the First Amendment.

“This case strikes at the heart of the freedom of speech and of the press,” they said in a statement. “We intend to see those constitutional guarantees vindicated at the end of the day.”

Seeking Evidence

Despite the seeming abundance of material online regarding the night of the suspected rape and the number of teenagers who were at the parties that night, the police still have had trouble establishing what anyone might regard as an airtight case.

A medical examination at a hospital more than one day after the parties did not reveal any evidence, like semen, that might have supported an accusation of rape, the police said. The Steubenville police knocked on doors of the people thought to be at the parties, but not many people were forthcoming with information. In several instances, the police seized cellphones so they could look for photographs or videos related to the case.

Eventually, 15 phones and 2 iPads were confiscated and analyzed by a cyber crime expert at the Ohio Bureau of Criminal Investigation. That expert could not retrieve deleted photographs and videos on most of the phones.

In the end, the expert recovered two naked photographs of the girl. One photograph showed the girl face down on the floor at one party, naked with her arms tucked beneath her, according to testimony given at a hearing in October. The other photograph was not described. Both photographs were found on Mays’s iPhone. No photograph or video showed anyone involved in a sexual act with the girl.

Anonymous complaints and chatter on the Internet about a less than fully aggressive investigation have perhaps not surprisingly proliferated.

It has left McCafferty, the police chief, fuming and frustrated.

For weeks after the girl’s parents came forward, he again pleaded to the other partygoers to come forward with information about the possible sexual assault. Only one did, he said.

“Everybody on those Web sites kept saying stuff that wasn’t true and saying, why wasn’t this person arrested, why aren’t the police doing anything about it,” he said. “Everybody wanted to incriminate more of the football players, some because some of the other schools in the area are simply jealous of Big Red.”

McCafferty, who has been the police chief for 11 years, is sensitive when it comes to criticism of his police force. He took over in the wake of a United States Department of Justice inquiry into the Steubenville Police Department’s patterns of false arrests and excessive force. And he now goes out of his way to try to assure residents that they can trust the police department again.

He said it bothered him when he heard people say that Big Red players got away with crimes in town. If crimes are being committed, he said, they are not being reported. He said no one had ever given him a concrete example of players’ receiving special treatment.

In 23 years on the force, he said, he can only remember one player before Mays and Richmond being arrested; that player was convicted of assault.

“It’s always, ‘They said players are getting away with things,’ but when I ask who ‘they’ is, no one can tell me,” McCafferty said.

 

Standing by His Players

In this part of the football-obsessed Ohio Valley — where at least several houses in every neighborhood have a “Roll Red Roll” or a “Big Red” sign out front — everybody knows Coach Reno Saccoccia. He has coached two generations of players at Big Red and has won 3 state titles and 85 percent of his games, according to the team’s Web site. The football team’s field is named Reno Field.

This season, the coach, who is used to winning, had to do without Mays and Richmond. But others who were at the parties and might have witnessed the suspected assault continued to play on the team. Saccoccia, a 63-year-old who brims with bravado, was the sole person in charge of determining whether any players would be punished.

Saccoccia, pronounced SOCK-otch, told the principal and school superintendent that the players who posted online photographs and comments about the girl the night of the parties said they did not think they had done anything wrong. Because of that, he said, he had no basis for benching those players.

The two players who testified at a hearing in early October to determine if there was enough evidence to continue the case were eventually suspended from the team. That came eight games into the 10-game regular season.

Approached in November to be interviewed about the case, Saccoccia said he did not “do the Internet,” so he had not seen the comments and photographs posted online from that night. When asked again about the players involved and why he chose not to discipline them, he became agitated.

“You made me mad now,” he said, throwing in several expletives as he walked from the high school to his car.

Nearly nose to nose with a reporter, he growled: “You’re going to get yours. And if you don’t get yours, somebody close to you will.”

Shawn Crosier, the principal of Steubenville High, and Michael McVey, the superintendent of Steubenville schools, said they entrusted Saccoccia with determining whether any players should be disciplined for what they might have done or saw the night of Aug. 11. Neither Crosier nor McVey spoke to any students about the events of that summer night, they said, because they were satisfied that Saccoccia would handle it.

In an interview last month, Crosier maintained that he was not aware of what might have happened to the girl, even with all of the talk in the town, until three Big Red athletes testified in early October. At the same time, he said that he might have read the online petition that called for a public apology from the players and the team. He said that if he had, he had not thought much of it.

McVey said he was not aware of the team having any off-field issues before this one.

“If this happened as a pattern, it would have set off an alarm,” McVey said of the possible sexual assault. “But we think this was an isolated incident.”

Neither Mays nor Richmond had a record, the police said, and each had numerous community members testify as character witnesses for them at the hearing in which the judge determined they should be tried as juveniles, not as adults.

Saccoccia was one of those witnesses, as was Michael Haney, the school’s varsity basketball coach, who said Richmond was such a talented player that he ranked in the top 100 high school players in the state.

Yet the football season went on without Mays and Richmond, two of the team’s stars. And Big Red’s record reflected the gap in its roster.

The team finished the season 9-3 after losing in the second round of the playoffs. It was the end of a disappointing year for the program and the fans who expect so much from Big Red players.

The fans from a perennial rival, the Massillon Tigers, took advantage of the team’s legal troubles and taunted players.

In the Tigers’ cheering section at the game against Steubenville was one fan who painted on his chest the words, “Rape Big Red.”

 

Players and Families Wait

Big Red’s season ended in early November, and the daily conversation in town is less and less about the suspected rape than it is about how the team will perform next year.

But inside a courtroom at the county jail, less than two miles down a hill from the football stadium, the debate over what happened to the girl that summer night is still unfolding.

The hearings in the case are open to the public, but court documents regarding the matter are sealed because the defendants are juveniles. Mays and Richmond were released to their families or guardians last month, though they must wear electronic monitoring devices and are allowed to leave home only to attend school at the county jail or church. On school days, they head to classes at the jail, wearing their new uniform: green sweat pants and tan shirts, which have numbers on their left sleeves.

Last month, Mays’s father, Brian, declined to be interviewed, saying, “It’ll all work out.” From the street outside his house, two shelves filled with athletic trophies could be seen inside a second-story room.

Richmond’s father, Nate, said his son was innocent. In September, he camped outside the county jail next to a banner that read, “Set my people free.”

“He didn’t do anything,” Richmond said.

Ma’lik Richmond now lives with his legal guardians, Jennifer and Greg Agresta, in a middle-class neighborhood with neatly trimmed lawns. A basketball hoop sits on the street in front of his house. Greg Agresta is a member of the school board.

Richmond’s grandmother, Mae, said the charges surprised her because Ma’lik had been so focused on sports and school, with hopes of leaving Steubenville for a better life and having a better life than his father, who has served time in prison and been charged with many crimes, including manslaughter.

“Me and Coach Reno was talking, and he said Ma’lik was just in the wrong place at the wrong time,” she said.

Adam Nemann, Mays’s lawyer, said the case was unusual because the police collected no physical evidence or testimony from the girl who asserts she was raped.

“The whole question is consent,” he said. “Was she conscious enough to give consent or not? We think she was. She gave out the pass code to her phone after the sexual assault was said to have occurred.”

Walter Madison, Richmond’s lawyer, said his client was already at a marked disadvantage because so many people discussed the incident online, through blogs and on Twitter.

“It’s an uphill battle because you’ve got social media going on and people formulating opinions, people who weren’t there and don’t know what happened,” he said. “In a small community, it exponentially snowballs out of control. I think the scales are a bit unbalanced.”

He said that online photographs and posts could ultimately be “a gift” for his client’s case because the girl, before that night in August, had posted provocative comments and photographs on her Twitter page over time. He added that those online posts demonstrated that she was sexually active and showed that she was “clearly engaged in at-risk behavior.”

The lawyers for the boys also said the three athletes who testified against their clients had credibility issues. The lawyers said that the police had found nude photographs of women on the phone of one of the witnesses, and that two witnesses had admitted recording some aspect of the suspected assault. Those alone could be crimes, the lawyers said, but the witnesses were given immunity from prosecution. Their testimony, the lawyers suggested, might have been given in a bid for leniency.

The special prosecutors on the case, Marianne Hemmeter and Jennifer Brumby of the Ohio Attorney General’s Crimes Against Children unit, declined to comment because the investigation was open.

But in court, they have rejected the defense’s claims. The girl, they have said, was in no condition to give consent to sexual advances that night — and the teenagers there knew it, the prosecutors said.

At a hearing in early October, prosecutors told the judge in the case that the defendants treated the girl “like a toy” and “the bottom line is we don’t have to prove that she said ‘no,’ we just have to prove that when they’re doing things to her, she’s not moving. She’s not responsive, and the evidence is consistent and clear.”

At a hearing last month, the girl’s mother said her daughter remained distraught and did not want to attend school. The girl’s friends have ostracized her, and parents have kept their children away from her, the mother said.

The girl does not sleep much, said the mother, who testified that she often hears her daughter crying at night.

The mother said the obsession with high school football in Steubenville is partly to blame. It shocked her that Saccoccia testified as a character witness for the defendants last month, she said.

In the courtroom that day, she remembered thinking, how dare he?

“Just Coach Reno saying he would testify for those boys, saying he was so proud of them, that speaks volumes,” she said. “All those football players are put on a pedestal over there, and it’s such a status symbol to play for Big Red, the culture is so different over there.”

The mother added: “I do feel like they’ve had preferential treatment, and it’s unreal, almost like we’re part of a TV show. It’s like a bad “CSI” episode. What those boys did was disgusting, disgusting, and for people to stand up for them, that’s disgusting, too.”

    Rape Case Unfolds on Web and Splits City, NYT, 16.12.2012,
    http://www.nytimes.com/2012/12/17/sports/
    high-school-football-rape-case-unfolds-online-and-divides-steubenville-ohio.html

A Vault for Taking Charge of Your Online Life

December 8, 2012
The New York Times
By NATASHA SINGER

REDWOOD CITY, Calif.

“YOU are walking around naked on the Internet and you need some clothes,” says Michael Fertik. “I am going to sell you some.”

Naked? Not exactly, but close.

Mr. Fertik, 34, is the chief executive of Reputation.com, a company that helps people manage their online reputations. From his perch here in Silicon Valley, he views the digital screens in our lives, the smartphones and the tablets, the desktops and the laptops, as windows of a house. People go about their lives on the inside, he says, while dozens of marketing and analytics companies watch through the windows, sizing them up like peeping Toms.

By now many Americans are learning that they are living in a surveillance economy. “Information resellers,” also known as “data brokers,” have collected hundreds to thousands of details — what we buy, our race or ethnicity, our finances and health concerns, our Web activities and social networks — on almost every American adult. Other companies that specialize in ranking consumers use computer algorithms to covertly score Internet users, identifying some as “high-value” consumers worthy of receiving pitches for premium credit cards and other offers, while dismissing others as a waste of time and marketing money. Yet another type of company, called an ad-trading platform, profiles Internet users and auctions off online access to them to marketers in a practice called “real-time bidding.”

As these practices have come to light, several members of Congress, and federal agencies, have opened investigations.

At least for now, however, these companies typically do not permit consumers to see the records or marketing scores that have been compiled about them. And that is perfectly legal.

Now, Mr. Fertik, the loquacious, lion-maned founder of Reputation.com, says he has the free-market solution. He calls it a “data vault,” or “a bank for other people’s data.”

Here at Reputation.com’s headquarters, a vast open-plan office decorated with industrial-looking metal struts and reclaimed wood — a discreet homage to the lab where Thomas Edison invented the light bulb — his company has amassed a database on millions of consumers. Mr. Fertik plans to use it to sell people on the idea of taking control of their own marketing profiles. To succeed, he will have to persuade people that they must take charge of their digital personas.

Pointing out the potential hazards posed by data brokers and the like is part of Mr. Fertik’s M.O. Covert online profiling and scoring, he says, may unfairly exclude certain Internet users from marketing offers that could affect their financial, educational or health opportunities — a practice Mr. Fertik calls “Weblining.” He plans to market Reputation.com’s data vault, scheduled to open for business early next year, as an antidote.

“A data privacy vault,” he says, “is a way to control yourself as a person.”

Reputation.com is at the forefront of a nascent industry called “personal identity management.” The company’s business model for its vault service involves collecting data about consumers’ marketing preferences and giving them the option to share the information on a limited basis with certain companies in exchange for coupons, say, or status upgrades. In turn, participating companies will get access both to potential customers who welcome their pitches and to details about the exact products and services those people are seeking. In theory, the data vault would earn money as a kind of authorization supervisor, managing the permissions that marketers would need to access information about Reputation.com’s clients.

To some, the idea seems a bit quixotic.

Reputation.com, with $67 million in venture capital, is not making a profit. Although the company’s “privacy” products, like removing clients’ personal information from list broker and marketing databases, are popular, its reputation management techniques can be controversial. For instance, it offers services meant to make negative commentary about individual or corporate clients less visible on the Web.

And there are other hurdles, like competition. A few companies, like Personal, have already introduced vault services. Also, a number of other enterprises have tried — and quickly failed — to sell consumers on data lockers.

Even so, Mr. Fertik contends Reputation.com has the answer. The company already has several hundred thousand paying customers, he says, and patents on software that can identify consumers’ information online and score their reputations. He intends to show clients their scores and advise them on how to improve them.

“You can’t just build a vault and wish that vendors cared enough about your data to pay for it,” Mr. Fertik says. “You have to build a business that gives you the lift to accumulate a data set and attract consumers, the science to create insights that are valuable to vendors, and the power to impose restrictions on the companies who consume your data.”
 

THE consumer data trade is large and largely unregulated.

Companies and organizations in the United States spend more than $2 billion a year on third-party data about individuals, according to a report last year on personal identity management from Forrester Research, a market research firm. They spend billions more on credit data, market research and customer data analytics, the report said.

Unlike consumer reporting agencies, which compile credit reports, however, business-to-business companies that calculate consumer valuation scores, or collect and sell consumer marketing data, are not required by federal law to show people the records the companies have about them or allow them to correct errors in their own files.

Marketing industry groups argue that regulation is unnecessary. They say Web sites have privacy policies to explain what data they and their business partners collect. They add that third-party data collectors do not know Internet users’ real names and compile consumers’ online marketing records under customer code numbers. Besides, they say, Internet users who are uncomfortable with seeing ads based on data-mining about themselves may use an industry group’s program, Your Ad Choices, to opt out of receiving customized pitches.

As the popular conversation shifts from practices like privacy policies and opt-outs to ideas like consumer empowerment and data rights, however, marketing industry efforts have not kept pace with changing public attitudes, analysts say.

“Consumers are leaving an exponentially growing digital footprint across channels and media, and they are awakening to the fact that marketers use this data for financial gain,” Fatemeh Khatibloo, an analyst at Forrester, wrote in the report. “This, combined with growing concerns about data security, means that individuals increasingly want to know when data about them is being collected, what is being stored and by whom, and how that data is being used.”

A variety of industries could respond by providing services that offer consumers greater control, she wrote. These might include online companies like Yahoo, Microsoft and Google that already house certain categories of data for consumers; social networks like Facebook and LinkedIn; data vaults like Personal, which allow consumers to store and manage certain kinds of data; and companies like Reputation.com whose business model already relies on customers willing to pay for data privacy.

In a phone interview last month, Ms. Khatibloo described how such an ecosystem might work.

Consumers could choose a variety of companies or institutions to house and manage different categories of their information. They might select a financial institution as the gatekeeper for their financial data, a medical center to manage their health data, and a consumer data locker as their retail manager. Then, when a person is ready to buy a car, she could authorize her personal vault to share relevant financial and insurance information with a car dealer. Or a person might allow his home insurer to survey his retail data vault for purchases every month and automatically increase his insurance coverage if he buys expensive items like a home entertainment system, she said.

“What is necessary to make that happen,” Ms. Khatibloo said, is “an inflection point of consumers adopting technology that makes it more valuable for marketers to come to them directly for their data.”

Marketers and information resellers will also have to acknowledge that consumers have some rights to information collected about them, she said. If the industry does not update its data capture practices, legislators and regulators are likely to mandate public data access, she said.

With increasing complaints by consumer advocacy groups and investigations by the news media, the surveillance economy is attracting greater government scrutiny. Two separate efforts in Congress are now examining practices by third-party consumer data collectors. Regulators at the Federal Trade Commission and researchers at the Government Accountability Office are also investigating. In a report this year, the F.T.C. recommended that Congress pass a law giving consumers the right to have some access to the records data brokers compile about them.

“We have a right, I think, to all of the data we have a hand in generating,” Ms. Khatibloo said. “I have the right to know who is tracking me online, who is looking at my behavior as I move from site to site, what data they are collecting, all of these.”
 

MR. FERTIK, blue marker in hand, sketches his vision of a data vault on a white board in a conference room at Reputation.com’s headquarters. “The problem is you don’t own your data,” he says. “Now, imagine owning your data.”

He sketches a silo and labeles it “data privacy vault.” To the left of the silo, he draws an arrow saying “IN: data about people.” To the right of the vault, he draws another arrow which says “OUT: data to vendors.”

It is a system he has previously described at the World Economic Forum in Davos, Switzerland; at Harvard Law School; at the Aspen Institute. He points to the diagram.

“This is the future. Let me demystify it. This is not difficult technology,” he says. “It’s a database where you put your data, or we put it for you, and there are some rules as to how it is externalized or shared.”

Mr. Fertik’s thinking on consumer privacy developed in part from what he called his Upper West Side, civil rights, “Jewish, lefty, pinko” upbringing and his Dalton, Horace Mann, Harvard College, Harvard Law School education. The result, Reputation.com, founded in 2006, is a part social justice, part profit motive.

“I thought something was wrong,” Mr. Fertik says. “You know when you go into a bank or an insurer that you may get offered different rates than the next person, but you have no idea when you go on the Internet that your options, the offers you get or whether you get a coupon, have been defined 20 steps before you get to a site.”

For $99 per year, clients can have the company remove their personal details from databases maintained by various information resellers. They can also install company software that blocks Web tracking by 200 data brokers, advertising networks and ad trading platforms. For $5,000 a year, Reputation.com also offers a “white glove” service for executives who want their personal details removed from list brokers with more cumbersome opt-out processes.

Reputation’s forthcoming data vault service is just a more elaborate attempt to monetize consumer privacy.

Mr. Fertik says he doesn’t think it will be difficult to persuade people to store their data in the vault and share some of it with selected companies in exchange for benefits like cash, coupons or status upgrades. The companies that get permission to gain access to his clients’ records, he adds, will have to sign contracts agreeing not to sell or share them with third parties.

Still, some people may not be comfortable with the fact that Reputation.com has already amassed files on millions of Americans mainly by scraping the Web. Other people may wonder whether a consumer data vault is truly secure. Mr. Fertik says Reputation.com will never share or sell clients’ information without their permission.

Convincing marketers that Reputation.com’s vault has more valuable information and consumer insights than an ordinary data broker is another challenge. “In order to make our information attractive to Best Buy, Amazon or Disney World, we’d have to tell them we have 5 percent more information about you and better insights than other sources,” Mr. Fertik says.
 

EXECUTIVES in technology, retail, marketing and other industries like to say that data is “the new oil” or, at least, the fuel that powers the Internet economy. It is a metaphor that casts consumers as natural resources with no say over the valuable commodities that companies extract from them.

Data vaults could give consumers more control over who sees certain kinds of information about them and how that information is used.

It is already a common practice in health care. Patients of the Kaiser Permanente system, for example, can use an online health manager to handle information about their health care, prescriptions and insurance. Elderly parents might also choose to give access to their health vault to offspring who help manage their care.

Still, consumers may not care enough about data-mining by marketers and information resellers to patronize data vaults. And legislators may eventually require information resellers to periodically provide consumers with free data reports, Ms. Khatibloo, of Forrester, said. That would put a dent in the fee-for-service data vault business.

In fact, some politicians and regulators already argue that services that charge people to control their personal data are not an appropriate solution to comprehensive online data collection.

“Having to pay a fee in order to engage in a retrospective effort to claw back personal information doesn’t seem to us the right way to go about this,” David Vladeck, the director of the Bureau of Consumer Protection at the Federal Trade Commission, said at a Congressional hearing in 2010.

Regulators are moving to give consumers more control over data without having to pay for it. In February, for example, the White House assigned the Commerce Department to supervise the development of a “Consumer Privacy Bill of Rights,” a code of conduct to be worked out between industry and consumer advocacy groups.

While governmental efforts inch along, companies like Reputation.com are forging ahead with new services that promise consumers more insight into the data collected about them. This month, for example, the direct-to-consumer division of Equifax, the credit information services company, plans to begin offering its customers a separate personal data report from Reputation.com in addition to their credit report. Some Equifax customers will also be offered the option to have Reputation.com delete personal details, like home addresses and phone numbers, from certain information broker databases.

“We see broadening consumers’ understanding of what’s out there about them online as a very natural extension of what we do today,” said Trey Loughran, the president of Equifax Personal Information Solutions.

Next spring, TransUnion Interactive, the consumer division of the TransUnion credit information company, plans to offer its customers similar services from Reputation.com.

These deals in no way signify that data vaults are a sure thing or, if they are, that Reputation.com is the company to take them to the masses. But the sudden interest from corporations like Equifax and TransUnion gives credence to the idea that consumers increasingly want to see data collected about themselves and that there is some commercial benefit in showing it to them.

After all, Mr. Fertik says, “it’s your data.”

    A Vault for Taking Charge of Your Online Life, NYT, 8.12.2012,
    http://www.nytimes.com/2012/12/09/business/company-envisions-vaults-for-personal-data.html

In WikiLeaks Case, Defense Puts the Jailers on Trial

December 7, 2012
The New York Times
By SCOTT SHANE and CHARLIE SAVAGE

FORT MEADE, Md. — In a half-empty courtroom here, with a crew of fervent supporters in attendance, Pfc. Bradley Manning and his lawyer have spent the last two weeks turning the tables on the government.

Private Manning faces a potential life sentence if convicted on charges that he gave WikiLeaks, the antisecrecy organization, hundreds of thousands of confidential military and diplomatic documents. But for now, he has been effectively putting on trial his former jailers at the Quantico, Va., Marine Corps base. His lawyer, David E. Coombs, has grilled one Quantico official after another, demanding to know why his client was kept in isolation and stripped of his clothing at night as part of suicide-prevention measures.

Mr. Coombs, a polite but relentless interrogator who stands a foot taller than his client, has laid bare deep disagreements inside the military: psychiatrists thought the special measures unnecessary, while jail commanders ignored their advice and kept the suicide restrictions in place. In a long day of testimony last week, Private Manning of the Army, vilified as a dangerous traitor by some members of Congress but lauded as a war-crimes whistle-blower on the political left, heartened his sympathizers with an eloquent and even humorous performance on the stand.

“He was engaged, chipper, optimistic,” said Bill Wagner, 74, a retired NASA solar physicist who is a courtroom regular, dressed in the black “Truth” T-shirt favored by Private Manning’s supporters.

Private Manning, who turns 25 on Dec. 17 and looks much younger, was quietly attentive during Friday’s court session, in a dress uniform, crew-cut blond hair and wire-rimmed glasses. If his face were not already familiar from television news, he might have been mistaken for a first-year law student assisting the defense team.

It seemed incongruous that he has essentially acknowledged responsibility for the largest leak of classified material in history. The material included a quarter-million State Department cables whose release may have chilled diplomats’ ability to do their work discreetly but also helped fuel the Arab Spring; video of American helicopter crews shooting people on the ground in Baghdad who they thought were enemy fighters but were actually Reuters journalists; field reports on the wars in Iraq and Afghanistan; and confidential assessments of the detainees locked up at Guantánamo Bay, Cuba.

As the military pursues the case against Private Manning, the Justice Department continues to explore the possibility of charging WikiLeaks’ founder, Julian Assange, or other activists with the group, possibly as conspirators in Private Manning’s alleged offense. Federal prosecutors in Alexandria, Va., are still assigned to that investigation, according to law enforcement officials, but it is not clear how active they have been lately in presenting evidence to a grand jury.

The current tone of the legal proceedings against Private Manning is most likely temporary. His lawyer is asking the judge overseeing the case to throw out the charges on the ground that his pretrial treatment was unlawful, but that outcome appears unlikely.

As a fallback, Mr. Coombs is hoping the court will at least give Private Manning extra credit against any ultimate sentence for the time he spent held under harsh conditions at Quantico and earlier in Kuwait, where he was kept in what he described as “an animal cage.” After the uproar about his treatment, including public criticism from the State Department’s top spokesman and the United Nations’ top torture expert, military officials moved Private Manning in April 2011 from Quantico to a new prison at Fort Leavenworth, Kan., where he has not faced the same restrictions on clothing, sleeping conditions and conversation with other inmates.

As if to underscore the gravity of his legal predicament, Private Manning offered last month to plead guilty to lesser charges that could send him to prison for 16 years. Prosecutors have not said whether they are interested in such a deal, which would mean they would have to give up seeking a life sentence for the most serious charges: aiding the enemy and violating the Espionage Act.

Friday’s court session was attended by a dozen Manning loyalists, including Thomas A. Drake, the former National Security Agency official who was accused of leaking documents and pleaded guilty to a minor charge last year. They heard the commander of the Quantico brig, or military jail, explain why she refused Private Manning’s request to be taken off “prevention of injury” status.

Chief Warrant Officer Denise Barnes, who was in charge of the brig for the last four months of Private Manning’s time there, said that the soldier declined her many requests to describe his emotional state in detail. Because of some odd behavior and two previous statements he had made that flagged him as a suicide risk, she said she was unwilling to change his status — despite the advice of military psychiatrists — until he opened up to her about how he was feeling.

Over the months she spent with him, speaking briefly with him each day, he grew less communicative and more monosyllabic, Ms. Barnes said.

“He did not clearly communicate to me, ‘I don’t want to kill myself,’ ” she said. “There was never an intent to punish Pfc. Manning.”

Ms. Barnes referred in passing to online attacks on her earlier this year by activists, one of whom called her a “sexual sadist.” She said she had no ill will against Private Manning “even though I was threatened and my family’s information was put out on the Internet.”

As Private Manning awaits a court-martial, now scheduled for March, Mr. Assange is holed up at Ecuador’s embassy in London, where he has lived since Ecuador granted him asylum in August. British officials have refused to grant him safe passage out of the country.

Mr. Assange faces no charges in connection with WikiLeaks but is wanted for questioning in Sweden in connection with allegations of sexual assault. He has expressed concern that Swedish authorities might extradite him to the United States.

From his embassy refuge, Mr. Assange has recently conducted a series of often-contentious television interviews with CNN, BBC and other news outlets, accusing the United States of torturing Private Manning. WikiLeaks supporters have theorized that the tough treatment of the soldier may have been designed to pressure him to testify against Mr. Assange.

No evidence has surfaced to support that theory. But if Private Manning’s offer to admit to reduced charges leads to serious plea negotiations, his cooperation in any future prosecution against WikiLeaks could conceivably be part of a deal.

Scott Shane reported from Fort Meade, and Charlie Savage from Washington.

    In WikiLeaks Case, Defense Puts the Jailers on Trial, NYT, 7.12.2012,
    http://www.nytimes.com/2012/12/08/us/in-private-bradley-manning-case-jailers-become-the-accused.html

Thanks for Not Sharing

December 6, 2012
The New York Times
By ROGER COHEN

London

LET us ponder oversharing and status anxiety, the two great scourges of the modern world.

The third, by the way, is the safety obsession of today’s “wuss generation.” But I’ll leave that for another day.

So let us absorb the mass of unwanted shared personal information and images that wash over one, like some great viscous tide full of stuff one would rather not think about — other people’s need for Icelandic lumpfish caviar, their numb faces at the dentist, their waffles and sausage, their appointments with their therapists, their personal hygiene, their pimples and pets, their late babysitters, their grumpy starts to the day, their rude exchanges, their leaking roofs, their faith in homeopathy, their stressing out, and all the rest.

Please, O wired humanity, spare me, and not only the details.

It is tempting to call this unctuous ooze of status updates and vacation snaps seeping across Facebook and Twitter and the rest information overload. But that would be to debase the word “information.”

Now I was determined to get through 2012 without doing a peevish column, not wishing to appear cantankerous or curmudgeonly, determined to be sunny and youthful as the times demand, but everyone has a tipping point. Mine occurred when I came across this tweet from Claire:

“Have such a volcanically deep zit laying roots in my chin that it feels like someone hit me with a right cross.”

Good to know, Claire.

I was just recovering from that when I found Deanna tweeting that she had “picked up pet food” and was heading to “the dreaded consult on colon stuff. The joys of turning 50.” As for Kate she let the world know the status of her labor: “Contractions 3 minutes apart and dilated at 2 cm.”

Social media does not mean that you have to be that social.

And then there was a Facebook post from Scott telling Addie how she is “my lover, my heart” and — my own heart sank — his “best friend.” It is very fashionable these days to call the love of one’s life one’s best friend. I cannot imagine why. Surely one has best friends in part in order to be able to talk to them about the problems with one’s loves.

What is this compulsion to share? Sometimes, of course, it is just a mistake, the wrong button hit, or mishandling of privacy settings on Facebook. But there is a new urge to behave as if life were some global high-school reunion at which everyone has taken some horrific tell-all drug.

My theory is this. Humanity has always been hardwired to fear. That is how we survived. But the fear used to be of wild beasts prowling, the encroaching Visigoths, plague, world war. Now, in the pampered present, all that anxiety has to find a new focus. So, having searched long and hard, and helped by technology, we have come up with being anxious that our status might be falling or — the horror, the horror! — disintegrating.

Number of Twitter followers shrinking or not growing as fast as your friends’? Status anxiety attack begins. No e-mails or texts received in the past 78 minutes? Status anxiety attack accelerates. Got unfriended or discover by chance on LinkedIn that your 29-year-old college roommate is now running an agribusiness fund out of St. Louis that has assets of $47 billion and owns half of Madagascar? Status meltdown kicks in.

The only antidote, the only means to push that status up again, it seems, is to keep sharing more and more. Here I am — the posts and tweets and pix say — a being not anonymous but alive. I overshare therefore I am.

As you have seen, dear reader, oversharing and status anxiety are twinned phenomena turning humanity into crazed dogs chasing their tails.

I thought reading snail mail might provide some relief only to open a letter today from my dentist reminding me that I am due for a visit to the hygienist (I know, I am oversharing here.) The letter went on: “Surveys have shown that the first thing people notice when they meet is a smile. If you would like some advice on how we can help you improve your smile then please ask at your next visit and we’d be happy to advise you on the best solution.”

Being in a dark mood, I imagined some advice like: “After long reflection, sir, we are sorry to inform you that the best solution would be to change your face.”

Aaah, well, I decided to go up and see my 15-year-old daughter who, astonishingly, had her laptop open and was on Facebook. “I can’t believe this girl from camp,” she said. “She’s so in love she shares everything.”

“Like what?”

Adele read a couple of Amanda’s recent posts: “Lying in bed wearing my boyfriend’s sweatshirt wishing I could be with him.” And: “If I could reach up and hold a star for every time you’ve made me smile the entire evening sky would be in the palm of my hand.”

We laughed. You have to.

You can follow me on Twitter or join me on Facebook.

    Thanks for Not Sharing, NYT, 6.12.2012,
    http://www.nytimes.com/2012/12/07/opinion/roger-cohen-thanks-for-not-sharing.html

Soldier in Leaks Case Says He’s Been Punished Enough

November 29, 2012
The New York Times
By THE ASSOCIATED PRESS

FORT MEADE, Md. (AP) — An Army private charged in the biggest leak of classified documents in United States history testified Thursday that he felt like a doomed, caged animal after he was arrested in Baghdad and accused of sending the military and diplomatic documents to the secret-spilling Web site WikiLeaks.

Pfc. Bradley Manning testified on the third day of a pretrial hearing at Fort Meade, outside Baltimore. His lawyers are seeking dismissal of all charges, arguing that his pretrial confinement in a Marine Corps brig in Quantico, Va., was needlessly harsh.

Before he was sent to Quantico in July 2010, Private Manning spent some time in a cell in a segregation tent at Camp Arifjan, an Army installation in Kuwait.

“I remember thinking, ‘I’m going to die,’ ” Private Manning, 24, said under questioning by one of his lawyers, David Coombs. “I’m stuck inside this cage. I just thought I was going to die in that cage. And that’s how I saw it: an animal cage.”

Private Manning is trying to avoid trial in the WikiLeaks case. He argues that he was punished enough when he was locked up alone in a small cell for nearly nine months at the brig in Quantico and had to sleep naked for several nights.

The military contends the treatment was proper, given his classification then as a maximum-security detainee who posed a risk of injury to himself or others.

Earlier Thursday, a military judge, Col. Denise Lind, accepted the terms under which Private Manning would plead guilty to eight charges for sending classified documents to WikiLeaks.

The judge’s ruling does not mean the pleas have been formally accepted. That could happen in December.

But she approved the language of the offenses to which Private Manning would admit, which she said would carry a total maximum prison term of 16 years.

Private Manning made the offer as a way of accepting responsibility for the leaks. Government officials have not said whether they would continue prosecuting him for the other 14 counts he faces, including aiding the enemy. That offense carries a maximum penalty of life in prison.

Under the proposal, Private Manning would admit to willfully sending the following material: a battlefield video file, some classified memorandums, more than 20 Iraq war logs, more than 20 Afghanistan war logs and other classified materials. He would also plead guilty to wrongfully storing classified information.

    Soldier in Leaks Case Says He’s Been Punished Enough, NYT, 29.11.2012,
    http://www.nytimes.com/2012/11/30/us/wikileaks-suspect-bradley-manning-describes-confinement.html

Courts Divided Over Searches of Cellphones

November 25, 2012
The New York Times
By SOMINI SENGUPTA

Judges and lawmakers across the country are wrangling over whether and when law enforcement authorities can peer into suspects’ cellphones, and the cornucopia of evidence they provide.

A Rhode Island judge threw out cellphone evidence that led to a man being charged with the murder of a 6-year-old boy, saying the police needed a search warrant. A court in Washington compared text messages to voice mail messages that can be overheard by anyone in a room and are therefore not protected by state privacy laws.

In Louisiana, a federal appeals court is weighing whether location records stored in smartphones deserve privacy protection, or whether they are “business records” that belong to the phone companies.

“The courts are all over the place,” said Hanni Fakhoury, a criminal lawyer with the Electronic Frontier Foundation, a San Francisco-based civil liberties group. “They can’t even agree if there’s a reasonable expectation of privacy in text messages that would trigger Fourth Amendment protection.”

The issue will attract attention on Thursday when a Senate committee considers limited changes to the Electronic Communications Privacy Act, a 1986 law that regulates how the government can monitor digital communications. Courts have used it to permit warrantless surveillance of certain kinds of cellphone data.

A proposed amendment would require the police to obtain a warrant to search e-mail, no matter how old it was, updating a provision that currently allows warrantless searches of e-mails more than 180 days old.

As technology races ahead of the law, courts and lawmakers are still trying to figure out how to think about the often intimate data that cellphones contain, said Peter P. Swire, a law professor at Ohio State University. Neither the 1986 statute nor the Constitution, he said, could have anticipated how much information cellphones may contain, including detailed records of people’s travels and diagrams of their friends.

“It didn’t take into account what the modern cellphone has — your location, the content of communications that are easily readable, including Facebook posts, chats, texts and all that stuff,” Mr. Swire said.

Courts have also issued divergent rulings on when and how cellphones can be inspected. An Ohio court ruled that the police needed a warrant to search a cellphone because, unlike a piece of paper that might be stuffed inside a suspect’s pocket and can be confiscated during an arrest, a cellphone may hold “large amounts of private data.”

But California’s highest court said the police could look through a cellphone without a warrant so long as the phone was with the suspect at the time of arrest.

Judges across the nation have written tomes about whether a cellphone is akin to a “container” — like a suitcase stuffed with marijuana that the police might find in the trunk of a car — or whether, as the judge in the Rhode Island murder case suggested, it is more comparable to a face-to-face conversation. That judge, Judith C. Savage, described text messages as “raw, unvarnished and immediate, revealing the most intimate of thoughts and emotions.” That is why, she said, citizens can reasonably expect them to be private.

There is little disagreement about the value of cellphone data to the police. In response to a Congressional inquiry, cellphone carriers said they responded in 2011 to 1.3 million demands from law enforcement agencies for text messages and other information about subscribers.

Among the most precious information in criminal inquiries is the location of suspects, and when it comes to location records captured by smartphones, court rulings have also been inconsistent. Privacy advocates say a trail of where people go is inherently private, while law enforcement authorities say that consumers have no privacy claim over signals transmitted from an individual mobile device to a phone company’s communications tower, which they refer to as third-party data.

Delaware, Maryland and Oklahoma have proposed legislation that would require the police to obtain a warrant before demanding location records from cellphone carriers. California passed such a law in August after intense lobbying by privacy advocates, including Mr. Fakhoury’s group. But Gov. Jerry Brown, a Democrat, vetoed the bill, questioning whether it struck “the right balance between the operational needs of law enforcement and individual expectations of privacy.”

Similar legislation has been proposed in Congress.

Lacking a clear federal statute, the courts have been unable to reach a consensus. In Texas, a federal appeals court said this year that law enforcement officials did not need a warrant to track suspects through cellphones. In Louisiana, another federal appeals court is considering a similar case. Prosecutors are arguing that location information is part of cellphone carriers’ business records and thus not constitutionally protected.

The Supreme Court has not directly tackled the issue, except to declare, in a landmark ruling this year, that the police must obtain a search warrant to install a GPS tracking device on someone’s private property.

“We are in a constitutional moment for location tracking,” said Ben Wizner, director of the American Civil Liberties Union’s Speech, Privacy and Technology Project. “It’s percolating in all these places.”

The Rhode Island case began shortly after 6 a.m. on a Sunday in October 2009, when Trisha Oliver called 911 to say that her son, Marco Nieves, 6, was unconscious in his bed. An ambulance rushed the boy to the hospital. A police officer also responded to the call, and Ms. Oliver escorted him through the bedrooms of her apartment. She then went to the hospital, leaving the police officer behind.

The officer heard a “beeping” in the kitchen, according to court papers. He picked up an LG-brand cellphone from the counter and saw this message: “Wat if I got 2 take him 2 da hospital wat do I say and dos marks on his neck omg.” It appeared to be from Ms. Oliver to her boyfriend, Michael Patino, court documents said.

Mr. Patino, 30, who was in the apartment at the time, was taken to the police station for questioning. The cellphone he had with him was seized. By evening, the boy was dead. The cause of death, according to court records, was “blunt force trauma to the abdomen which perforated his small intestine.”

Mr. Patino was charged with Marco’s murder.

In the course of the investigation, the police obtained more than a dozen search warrants for the cellphones of Mr. Patino, Ms. Oliver and their relatives. They also obtained records of phone calls and voice mail messages from the cellphone carriers.

Nearly three years later, in a 190-page ruling, Judge Savage sharply criticized the police.

The first police officer had no right to look at the phone without a search warrant, Judge Savage ruled. It was not in “plain view,” she wrote, nor did Ms. Oliver give her consent to search it. The court said Mr. Patino could reasonably have expected the text messages he exchanged with Ms. Oliver to be free from police scrutiny.

The judge then suppressed the bounty of evidence that the prosecution had secured through warrants, including the text message that had initially drawn the police officer’s attention.

“Given the amount of private information that can be readily gleaned from the contents of a person’s cellphone and text messages — and the heightened concerns for privacy as a result — this court will not expand the warrantless search exceptions to include the search of a cellphone and the viewing of text messages,” she wrote.

Mr. Patino remains in jail while the case is on appeal in the state’s Supreme Court. A lawyer for Mr. Patino did not respond to a request for comment.

Just months before Judge Savage’s ruling, the Rhode Island legislature passed a law compelling the police to obtain a warrant to search a cellphone, even if they find it during an arrest. Gov. Lincoln D. Chafee, an independent, vetoed the bill, saying, “The courts, and not the legislature, are better suited to resolve these complex and case-specific issues.”

    Courts Divided Over Searches of Cellphones, NYT, 25.11.2012,
    http://www.nytimes.com/2012/11/26/technology/l
    egality-of-warrantless-cellphone-searches-goes-to-courts-and-legislatures.html

Scientists See Promise in Deep-Learning Programs

November 23, 2012
The New York Times
By JOHN MARKOFF

Using an artificial intelligence technique inspired by theories about how the brain recognizes patterns, technology companies are reporting startling gains in fields as diverse as computer vision, speech recognition and the identification of promising new molecules for designing drugs.

The advances have led to widespread enthusiasm among researchers who design software to perform human activities like seeing, listening and thinking. They offer the promise of machines that converse with humans and perform tasks like driving cars and working in factories, raising the specter of automated robots that could replace human workers.

The technology, called deep learning, has already been put to use in services like Apple’s Siri virtual personal assistant, which is based on Nuance Communications’ speech recognition service, and in Google’s Street View, which uses machine vision to identify specific addresses.

But what is new in recent months is the growing speed and accuracy of deep-learning programs, often called artificial neural networks or just “neural nets” for their resemblance to the neural connections in the brain.

“There has been a number of stunning new results with deep-learning methods,” said Yann LeCun, a computer scientist at New York University who did pioneering research in handwriting recognition at Bell Laboratories. “The kind of jump we are seeing in the accuracy of these systems is very rare indeed.”

Artificial intelligence researchers are acutely aware of the dangers of being overly optimistic. Their field has long been plagued by outbursts of misplaced enthusiasm followed by equally striking declines.

In the 1960s, some computer scientists believed that a workable artificial intelligence system was just 10 years away. In the 1980s, a wave of commercial start-ups collapsed, leading to what some people called the “A.I. winter.”

But recent achievements have impressed a wide spectrum of computer experts. In October, for example, a team of graduate students studying with the University of Toronto computer scientist Geoffrey E. Hinton won the top prize in a contest sponsored by Merck to design software to help find molecules that might lead to new drugs.

From a data set describing the chemical structure of 15 different molecules, they used deep-learning software to determine which molecule was most likely to be an effective drug agent.

The achievement was particularly impressive because the team decided to enter the contest at the last minute and designed its software with no specific knowledge about how the molecules bind to their targets. The students were also working with a relatively small set of data; neural nets typically perform well only with very large ones.

“This is a really breathtaking result because it is the first time that deep learning won, and more significantly it won on a data set that it wouldn’t have been expected to win at,” said Anthony Goldbloom, chief executive and founder of Kaggle, a company that organizes data science competitions, including the Merck contest.

Advances in pattern recognition hold implications not just for drug development but for an array of applications, including marketing and law enforcement. With greater accuracy, for example, marketers can comb large databases of consumer behavior to get more precise information on buying habits. And improvements in facial recognition are likely to make surveillance technology cheaper and more commonplace.

Artificial neural networks, an idea going back to the 1950s, seek to mimic the way the brain absorbs information and learns from it. In recent decades, Dr. Hinton, 64 (a great-great-grandson of the 19th-century mathematician George Boole, whose work in logic is the foundation for modern digital computers), has pioneered powerful new techniques for helping the artificial networks recognize patterns.

Modern artificial neural networks are composed of an array of software components, divided into inputs, hidden layers and outputs. The arrays can be “trained” by repeated exposures to recognize patterns like images or sounds.

These techniques, aided by the growing speed and power of modern computers, have led to rapid improvements in speech recognition, drug discovery and computer vision.

Deep-learning systems have recently outperformed humans in certain limited recognition tests.

Last year, for example, a program created by scientists at the Swiss A. I. Lab at the University of Lugano won a pattern recognition contest by outperforming both competing software systems and a human expert in identifying images in a database of German traffic signs.

The winning program accurately identified 99.46 percent of the images in a set of 50,000; the top score in a group of 32 human participants was 99.22 percent, and the average for the humans was 98.84 percent.

This summer, Jeff Dean, a Google technical fellow, and Andrew Y. Ng, a Stanford computer scientist, programmed a cluster of 16,000 computers to train itself to automatically recognize images in a library of 14 million pictures of 20,000 different objects. Although the accuracy rate was low — 15.8 percent — the system did 70 percent better than the most advanced previous one.

Deep learning was given a particularly audacious display at a conference last month in Tianjin, China, when Richard F. Rashid, Microsoft’s top scientist, gave a lecture in a cavernous auditorium while a computer program recognized his words and simultaneously displayed them in English on a large screen above his head.

Then, in a demonstration that led to stunned applause, he paused after each sentence and the words were translated into Mandarin Chinese characters, accompanied by a simulation of his own voice in that language, which Dr. Rashid has never spoken.

The feat was made possible, in part, by deep-learning techniques that have spurred improvements in the accuracy of speech recognition.

Dr. Rashid, who oversees Microsoft’s worldwide research organization, acknowledged that while his company’s new speech recognition software made 30 percent fewer errors than previous models, it was “still far from perfect.”

“Rather than having one word in four or five incorrect, now the error rate is one word in seven or eight,” he wrote on Microsoft’s Web site. Still, he added that this was “the most dramatic change in accuracy” since 1979, “and as we add more data to the training we believe that we will get even better results.”

One of the most striking aspects of the research led by Dr. Hinton is that it has taken place largely without the patent restrictions and bitter infighting over intellectual property that characterize high-technology fields.

“We decided early on not to make money out of this, but just to sort of spread it to infect everybody,” he said. “These companies are terribly pleased with this.”

Referring to the rapid deep-learning advances made possible by greater computing power, and especially the rise of graphics processors, he added:

“The point about this approach is that it scales beautifully. Basically you just need to keep making it bigger and faster, and it will get better. There’s no looking back now.”

    Scientists See Promise in Deep-Learning Programs, NYT, 23.11.2012,
    http://www.nytimes.com/2012/11/24/science/
    scientists-see-advances-in-deep-learning-a-part-of-artificial-intelligence.html

Facebook’s False Faces Undermine Its Credibility

November 12, 2012
The New York Times
By SOMINI SENGUPTA

SAN FRANCISCO — The Facebook page for Gaston Memorial Hospital, in Gastonia, N.C., offers a chicken salad recipe to encourage healthy eating, tips on avoiding injuries at Zumba class, and pictures of staff members dressed up at Halloween. Typical stuff for a hospital in a small town.

But in October, another Facebook page for the hospital popped up. This one posted denunciations of President Obama and what it derided as “Obamacare.” It swiftly gathered hundreds of followers, and the anti-Obama screeds picked up “likes.” Officials at the hospital, scrambling to get it taken down, turned to their real Facebook page for damage control. “We apologize for any confusion,” they posted on Oct. 8, “and appreciate the support of our followers.”

The fake page came down 11 days later, as mysteriously as it had come up. The hospital says it has no clue who was behind it.

Fakery is all over the Internet. Twitter, which allows pseudonyms, is rife with fake followers, and has been used to spread false rumors, as it was during Hurricane Sandy. False reviews are a constant problem on consumer Web sites.

Gaston Memorial’s experience is an object lesson in the problem of fakery on Facebook. For the world’s largest social network, it is an especially acute problem, because it calls into question its basic premise. Facebook has sought to distinguish itself as a place for real identity on the Web. As the company tells its users: “Facebook is a community where people use their real identities.” It goes on to advise: “The name you use should be your real name as it would be listed on your credit card, student ID, etc.”

Fraudulent “likes” damage the trust of advertisers, who want clicks from real people they can sell to and whom Facebook now relies on to make money. Fakery also can ruin the credibility of search results for the social search engine that Facebook says it is building.

Facebook says it has always taken the problem seriously, and recently stepped up efforts to cull fakes from the site. “It’s pretty much one of the top priorities for the company all the time,” said Joe Sullivan, who is in charge of security at Facebook.

The fakery problem on Facebook comes in many shapes. False profiles are fairly easy to create; hundreds can pop up simultaneously, sometimes with the help of robots, and often they persuade real users into friending them in a bid to spread malware. Fake Facebook friends and likes are sold on the Web like trinkets at a bazaar, directed at those who want to enhance their image. Fake coupons for meals and gadgets can appear on Facebook newsfeeds, aimed at tricking the unwitting into revealing their personal information.

Somewhat more benignly, some college students use fake names in an effort to protect their Facebook content from the eyes of future employers.

Mr. Sullivan declined to say what portion of the company’s now one billion plus users were fake. The company quantified the problem last June, in responding to an inquiry by the Securities and Exchange Commission. At that time, the company said that of its 855 million active users, 8.7 percent, or 83 million, were duplicates, false or “undesirable,” for instance, because they spread spam.

Mr. Sullivan said that since August, the company had put in place a new automated system to purge fake “likes.” The company said it has 150 to 300 staff members to weed out fraud.

Flags are raised if a user sends out hundreds of friend requests at a time, Mr. Sullivan explained, or likes hundreds of pages simultaneously, or most obvious of all, posts a link to a site that is known to contain a virus. Those suspected of being fakes are warned. Depending on what they do on the site, accounts can be suspended.

In October, Facebook announced new partnerships with antivirus companies. Facebook users can now download free or paid antivirus coverage to guard against malware.

“It’s something we have been pretty effective at all along,” Mr. Sullivan said.

Facebook’s new aggressiveness toward fake “likes” became noticeable in September, when brand pages started seeing their fan numbers dip noticeably. An average brand page, Facebook said at the time, would lose less than 1 percent of its fans.

But the thriving market for fakery makes it hard to keep up with the problem. Gaston Memorial, for instance, first detected a fake page in its name in August; three days later, it vanished. The fake page popped up again on Oct. 4, and this time filled up quickly with the loud denunciations of the Obama administration. Dallas P. Wilborn, the hospital’s public relations manager, said her office tried to leave a voice-mail message for Facebook but was disconnected; an e-mail response from the social network ruled that the fake page did not violate its terms of service. The hospital submitted more evidence, saying that the impostor was using its company logo.

Eleven days later, the hospital said, Facebook found in its favor. But by then, the local newspaper, The Gaston Gazette, had written about the matter, and the fake page had disappeared.

Facebook declined to comment on the incident, and pointed only to its general Statement of Rights and Responsibilities.

The election season seems to have increased the fakery.

In Washington State, two groups fighting over a gay marriage referendum locked horns over “likes” on Facebook. A group supportive of gay marriage pointed to the Facebook page of its rival, Preserve Marriage Washington, which collected thousands of “likes” in a few short spurts. During those peaks, the pro-gay marriage group said, the preponderance of the “likes” came from far-flung cities like Bangkok and Vilnius, Lithuania, whose residents would seem to have little reason to care about a state referendum in Washington. The “likes” then fell as suddenly as they had risen.

The accusations were leveled on the Web site of the gay marriage support group, Washington United for Marriage. Preserve Marriage Washington in turn denied them on its Facebook page. Facebook declined to comment on the contretemps.

The research firm Gartner estimates that while less than 4 percent of all social media interactions are false today, that figure could rise to over 10 percent by 2014.

Fake users and their fake posts will have to be culled aggressively if Facebook wants to expand its search function, said Shuman Ghosemajumder, a former Google engineer whose start-up, Shape Security, focuses on automated fakery on the Internet. If you are searching for a laptop computer, for instance, Facebook has to ensure that you can trust the search results that come up.

“If the whole idea behind social search is to look behind what different Facebook users are doing, then you have to make sure you don’t have fake accounts to influence that,” he said.

The ubiquity of Facebook, some users say, compels them to be a little bit fake. Colleen Callahan, who is 25, is among them. She was a senior in college when she started getting slightly nervous about the pictures that a prospective employer might find on Facebook. Like the pages of most of her college friends, she said, hers had a preponderance of party pictures.

“It would be O.K. if people saw it, but I didn’t want people to interpret it differently,” she said. So Ms. Callahan tweaked her profile. She became Colleen Skisalot. (“I am a big skier,” she explained.)

The name stuck. She still hasn’t changed it, though she is no longer afraid of what prospective employers might think. She has a job — with an advertising agency in Boston, some of whose clients, it turns out, advertise on Facebook.

    Facebook’s False Faces Undermine Its Credibility, NYT, 12.11.2012,
    http://www.nytimes.com/2012/11/13/technology/false-posts-on-facebook-undermine-its-credibility.html

Social Media, Growing in Legal Circles,

Find a Role in Florida Murder Case

November 6, 2012
The New York Times
By LIZETTE ALVAREZ

MIAMI — When Mark O’Mara agreed to defend George Zimmerman in the Trayvon Martin murder case, one of his first major decisions was to embrace the Internet.

He set up a legal defense Web site for his client, a Twitter page and a Facebook account, all with the purpose of countering what he called the “avalanche of misinformation” about the case and Mr. Zimmerman.

It was a risky move, unorthodox for a criminal defense lawyer, legal experts said, but a bold one. Late last month, the judge in the case, rebuffing the prosecution, allowed Mr. O’Mara to keep the online presence.

In so doing, the judge sanctioned the use of social media in a high-profile murder case that was already steeped in the power of Facebook, Twitter and blogs. Not long after Mr. Martin was shot and killed, protesters took their cues from Facebook and demonstrated across the country. Angry words coursed through Twitter.

Mr. Zimmerman, in hiding, started a Web site to raise money. The Martin family’s lawyers, who made ample use of traditional media, used Twitter to bring attention to Mr. Martin’s death.

Social media is playing a role in the courtroom, too. Mr. O’Mara wants to use Mr. Martin’s Facebook page and Twitter feed to bolster Mr. Zimmerman’s claim of self-defense. But he will most likely face a protracted battle to authenticate the material, in part because Mr. Martin is no longer alive. Last month, the judge allowed Mr. O’Mara to subpoena Twitter and Facebook for the information.

In ways large and small, the State of Florida v. George Zimmerman is serving as a modernized blueprint for deploying social media in a murder case.

“The way the whole case has been playing out in social media is typical of our times, but more typical of civil cases than criminal cases,” said Robert Ambrogi, a lawyer and technology expert who writes a blog on the intersection of the legal profession and social media. “It’s not without precedent, but it’s on the cutting edge.”

In civil cases, lawyers routinely dig up Facebook photos of people claiming to have a back injury dancing atop bars or revealing posts from supposedly faithful spouses.

“In the world of electronic information, the amount of potentially relevant information in discovery has exploded,” said Kenneth Withers, the director of judicial education and content for The Sedona Conference, a nonprofit law and policy research organization, referring to the pretrial exchange of information and evidence between lawyers on both sides. “And with social media, there has been an explosion of an explosion.”

It no longer makes sense for criminal defense lawyers who have tread more cautiously into social media to brush it off or avoid it, legal experts said.

Nicole Black, a co-author of “Social Media for Lawyers,” said criminal lawyers are getting crash courses on how to best use social media to help their clients and themselves.

“There is almost hysteria among the lawyers to understand it and how it’s affecting their practice,” said Ms. Black, who is also the director of business development and community relations at MyCaseInc.com.

Mr. O’Mara said as much in court recently when he pressed for access to Mr. Martin’s Facebook page and for the continued use of the legal defense Web site and its Twitter feed. “This is 2012, and I’m sorry, I used to have the books on the shelf, and those days are long gone,” he said. “We now have an active vehicle for information. I will tell you that today, if every defense attorney is not searching for information on something like this, he will be committing malpractice.”

Mr. Zimmerman, a Hispanic neighborhood watch volunteer in Sanford, Fla., is charged with second-degree murder in the shooting death of Mr. Martin, an unarmed black teenager who was killed in February as he walked to a house where he was staying as a guest.

Mr. O’Mara has been careful to hew to ethical requirements on his Twitter feed and Web site, which he uses to post legal documents, react to developments in the case and raise money for his client. He allows comments to be posted so long as they are not inflammatory. When the Facebook page “devolved into people bickering,” he said, he shut it down.

Social media is difficult to control, which for many is precisely its allure. Last month, Mr. Zimmerman’s brother, Robert Zimmerman Jr., fired off an angry post on Twitter at Natalie Jackson, one of the Martin family’s lawyers.

“My Life’s work = you WILL be held accountable for your words/actions. You A’INT seen NOTHIN’ yet ... I will see U disbarred,” he posted on Twitter.

Mr. O’Mara wrote a reaction on his Web site.

“Regarding Robert Zimmerman Jr.’s media campaign and Twitter comments, Robert is acting on behalf of his family, and he is not acting with the approval or the input of the defense team,” he wrote. He noted that, “The Zimmerman family has been through a lot, and they have been frequently misrepresented in the media, so we do not begrudge Robert for wanting to speak out and set the record straight.”

While Mr. O’Mara has become adept at social media, rattling off the number of Google hits on the words Trayvon Martin and the tally of visits to the legal defense site — 267,089 as of Monday — plunging into the world of Twitter, Facebook and blogs is not a welcome development for all in the courtroom.

“I’m new to this, quite frankly; I’m old,” a prosecutor, Bernie de la Rionda, said as the two sides faced off over social media in the courtroom.

Before long, Judge Debra S. Nelson will have to decide how to handle social media during the trial, which is scheduled to begin on June 10. Some jurors in other cases across the country have taken to posting about the proceedings on Facebook or Twitter, posing a risk of mistrials. Judges have cracked down.

Considering the publicity in the case, Judge Nelson may wind up following the lead of the judge in another high-profile Florida murder trial, that of Casey Anthony, who was acquitted of killing her young daughter. She could sequester the jury members, confiscate their cellphones and laptops, and monitor their calls and computer time.

If Judge Nelson does follow suit, she must be prepared to deal with another juror dilemma: extreme withdrawal.

    Social Media, Growing in Legal Circles, Find a Role in Florida Murder Case, NYT, 6.11.2012,
    http://www.nytimes.com/2012/11/07/us/social-media-finds-a-role-in-case-against-zimmerman.html

I Didn’t Write That

November 3, 2012
The New York Times
By DAVID KAISER

Cambridge, Mass.

THERE must be an election coming up. I know this because of the number of times I have been getting a certain e-mail, one that begins, “Take the three minutes to read this. Maybe he is wrong, but what if he’s right?” I first received the e-mail — which includes an essay railing against President Obama and the Federal Reserve — back in March 2009, just weeks after the president’s inauguration. Since then, 267 people have e-mailed me about it; about two dozen more have called my office to talk about it. A vast majority of them agree with the essay’s sentiments and want to compliment me for my work.

The essay, which has been promoted on blogs across the Internet, is attributed to a person named David Kaiser. As it happens, my name is David Kaiser. We are not the same person. In fact, the e-mail states clearly that it was written by a historian and “professor in the Strategy and Policy Department of the United States Naval War College.” Some versions included a photo of this David Kaiser, taken from his Wikipedia entry. I teach physics and the history of science at the Massachusetts Institute of Technology, and my Web site includes a photograph of myself right next to my e-mail address. We look nothing alike.

The essay includes a short curriculum vitae for the professor (now retired from the Naval War College), the names of several of his books and his prior teaching appointments. Each of those items is true, except for one detail: that David Kaiser did not write it, either.

After the false attribution, the essay launches into a tirade against the president that culminates in a comparison between him and Adolf Hitler. There are elementary flaws throughout — Winston Churchill never served in the British House of Lords, for one — piled on top of outlandish claims like the one that Mr. Obama promised to “create and fund a mandatory civilian defense force stronger than our military for use inside our borders.” In between are sneering gibes at religious minorities, schoolteachers and supporters of same-sex marriage.

The rate at which the essay lands in my in-box follows the political news cycle. About one e-mail arrived each day during April and May 2009, when the stimulus plan and the auto-industry bailout were in the headlines. Then the traffic fell by half until the pitched battles over the Affordable Care Act: I received about twice as many e-mails about the essay during September 2009 as I did at the peak period of the previous spring. Again there followed a brief quiescence until the Congressional election of 2010. After each of those spikes, I foolishly thought that the episode had run its course. But no: with each new round of partisan finger-pointing in Washington, my in-box would fill up again.

One concerned citizen wrote to me: “I just got an e-mail that I believe you authored and I agree with every word. Now, what do we do to stop this?” Another wrote, “All I can say is keep up the good work until the ‘brown shirts’ come along with a wide sweeping ‘Fairness doctrine’ to shut you down.” A year later one satisfied reader greeted me, “Hello, ‘soul mate’!” This past July someone e-mailed to thank me for the essay, adding: “It is time for people to speek [sic] out and voice their thoughts and findings on Obama. Facts are facts.” Several correspondents have requested permission to reprint “my” essay in their local newspaper. Others clearly have had tastes that run beyond the mainstream media, like the reader who opined, “this country has been under the control of satanic, antichrist powers — not government.”

I first wrote to the other David Kaiser about the essay at the end of March 2009. He confirmed that he had not written it, either, that it absolutely did not represent his views, and that he was also being inundated. Neither of us had any idea how to get our names off it.

By the first week of April 2009, fact-checking Web sites like snopes.com had declared the essay’s attributed authorship to be bogus. According to Snopes, the real provenance of the essay was an anonymous comment on a blog. By that time, I had received precisely 11 e-mails about it. More than 250 e-mails arrived after it had been publicly declared a hoax. And that’s what troubles me. The essay falls in a beguiling category: the zombie fact, claims that are shown to be untrue but which simply will not die.

Zombie facts were hardly created by the Internet; even a brief perusal of the partisan newspapers of the 19th century will make that plain. But today’s rumors have a self-perpetuating quality, which is accentuated by the erosion of trust in institutions that had once seemed authoritative. Gallup reported in September that Americans’ distrust of traditional media had hit a historic high, while approval of Congress had hit an election-year low. As more people turn to blogs for news and commentary, readership separates between conservative and liberal sites, with little cross-traffic. Self-proclaimed fact-checking sites proliferate, beholden to no particular standards. An editor of one of these sites contacted me about the Obama-Hitler essay, thinking he had reached the David Kaiser of the Naval War College. That did not inspire confidence.

The legal scholar Cass R. Sunstein recently wrote in these pages that efforts to forge common understanding on politically divisive issues might be most effective if we paid attention to the sources of information and not just how the information was presented. “Our initial convictions are more apt to be shaken if it’s not easy to dismiss the source as biased, confused, self-interested or simply mistaken.” Exactly — which is presumably why the authorship of the e-mail hoax was faked in the first place. About a month after the first one arrived, the e-mails showed a note had been added to the opening of the essay: “This is enlightening. Lest you think it was written by some right-wing kook, David Kaiser is a respected historian.”

As the great political theorist (and famous comedian) George Burns taught us, “if you can fake sincerity, then you’ve really got it made.” (Tellingly, versions of that quotation have been attributed to Groucho Marx, Jean Giraudoux and Daniel Schorr, among others.) Mr. Sunstein’s solution might work in a world in which identities were less easily faked, forged or stolen. After three and a half years of trying to debunk it, however, the Obama-Hitler essay still haunts the Internet (and my in-box).

And yet there is a bright side. After I began receiving the e-mails, I drafted a brief form letter to send in reply, pointing out the fake authorship. Whereas many correspondents had spewed incredibly hateful slogans in their initial messages, nearly all reverted to polite civility once the error had been pointed out.

One reader had been so inspired by the essay that he took my photograph from my Web site and posted it, along with my full résumé and the text of the essay, on his own — a conspiracy-addled “new world order” site that made the essay’s contents seem tame. When I finally reached him by phone to ask if he might take the posting down, he agreed, and I was surprised by how quickly our conversation turned to remarkably ordinary topics. There was no more howling about government plots or millennial apocalypse; the talking points faded away. We found we were but two people caught in a misunderstanding. Despite the rancor and factual recklessness of our latest election season, there might be hope for us yet.

David Kaiser is a professor of the history of science

at the Massachusetts Institute of Technology

and the author of “How the Hippies Saved Physics:

Science, Counterculture, and the Quantum Revival.”

    I Didn’t Write That, NYT, 3.11.2012,
    http://www.nytimes.com/2012/11/04/opinion/sunday/i-didnt-write-that.html

Google Casts a Big Shadow on Smaller Web Sites

November 3, 2012
The New York Times
By STEVE LOHR and CLAIRE CAIN MILLER

STARTING in February, Jeffrey G. Katz grew increasingly anxious as he watched the steady decline of online traffic to his company’s comparison-shopping Web site, Nextag, from Google’s search engine.

In a geeky fire drill, engineers and outside consultants at Nextag scrambled to see if the problem was its own fault. Maybe some inadvertent change had prompted Google’s algorithm to demote Nextag when a person typed in shopping-related search terms like “kitchen table” or “lawn mower.”

But no, the engineers determined. And traffic from Google’s search engine continued to decline, by half.

Nextag’s response? It doubled its spending on Google paid search advertising in the last five months.

The move was costly but necessary to retain shoppers, Mr. Katz says, because an estimated 60 percent of Nextag’s traffic comes from Google, both from free search and paid search ads, which are ads that are related to search results and appear next to them. “We had to do it,” says Mr. Katz, chief executive of Wize Commerce, owner of Nextag. “We’re living in Google’s world.”

Regulators in the United States and Europe are conducting sweeping inquiries of Google, the dominant Internet search and advertising company. Google rose by technological innovation and business acumen; in the United States, it has 67 percent of the search market and collects 75 percent of search ad dollars. Being big is no crime, but if a powerful company uses market muscle to stifle competition, that is an antitrust violation.

So the government is focusing on life in Google’s world for the sprawling economic ecosystem of Web sites that depend on their ranking in search results. What is it like to live this way, in a giant’s shadow? The experience of its inhabitants is nuanced and complex, a blend of admiration and fear.

The relationship between Google and Web sites, publishers and advertisers often seems lopsided, if not unfair. Yet Google has also provided and nurtured a landscape of opportunity. Its ecosystem generates $80 billion a year in revenue for 1.8 million businesses, Web sites and nonprofit organizations in the United States alone, it estimates.

The government’s scrutiny of Google is the most exhaustive investigation of a major corporation since the pursuit of Microsoft in the late 1990s.

The staff of the Federal Trade Commission has recommended preparing an antitrust suit against Google, according to people briefed on the inquiry, who spoke on the condition they not be identified. But the commissioners must vote to proceed. Even if they do, the government and Google could settle.

Google has drawn the attention of antitrust officials as it has moved aggressively beyond its dominant product — search and search advertising — into fields like online commerce and local reviews. The antitrust issue is whether Google uses its search engine to favor its offerings like Google Shopping and Google Plus Local over rivals.

For policy makers, Google is a tough call.

“What to do with an attractive monopolist, like Google, is a really challenging issue for antitrust,” says Tim Wu, a professor at Columbia Law School and a former senior adviser to the F.T.C. “The goal is to encourage them to stay in power by continuing to innovate instead of excluding competitors.”

SPEAKING at a Google Zeitgeist conference in Arizona last month, Larry Page, the company’s co-founder and chief executive, said he understood the government scrutiny of his company, given Google’s size and reach. “There’s very many decisions we make that really impact a lot of people,” he acknowledged.

The main reason is that Google is continually adjusting its search algorithm — the smart software that determines the relevance, ranking and presentation of search results, typically links to other Web sites.

Google says it makes the changes to improve its service, and has long maintained that its algorithm weeds out low-quality sites and shows the most useful results, whether or not they link to Google products.

“Our first and highest goal has to be to get the user the information they want as quickly and easily as possible,” says Matt Cutts, leader of the Web spam team at Google.

But Google’s algorithm is secret, and changes can leave Web sites scrambling.

Consider Vote-USA.org, a nonprofit group started in 2003. It provides online information for voters to avoid the frustration of arriving at a polling booth and barely recognizing half the names on the ballot. The site posts free sample ballots for federal, state and local elections with candidates’ pictures, biographies and views on issues.

In the 2004 and 2006 elections, users created tens of thousands of sample ballots. By 2008, traffic had fallen sharply, says Ron Kahlow, who runs Vote-USA.org, because “we dropped off the face of the map on Google.”

As founder of a search-engine optimization company and a recipient of grants that Google gives nonprofits to advertise free, Mr. Kahlow knows a thing or two about how to operate in Google’s world. He pored over Google’s guidelines for Web sites, made changes and e-mailed Google. Yet he received no response.

“I lost all donations to support the operation,” he said. “It was very, very painful.”

A breakthrough came through a personal connection. A friend of Mr. Kahlow knew Ed Black, chief executive of the Computer & Communications Industry Association, whose members include Google. Mr. Black made an inquiry on Mr. Kahlow’s behalf, and a Google engineer investigated.

The problem, Mr. Kahlow learned, was that the site’s state Web pages also had information for national candidates — reasonable to a person seeking voting information at one digital location. But to Google’s algorithm, duplicate content on a site suggests a shady shortcut to try to make a site look bigger than it is.

Mr. Kahlow fixed that, so that someone on a state page must go to another page to see the ballot and information about national candidates. Vote-USA.org quickly moved off Google’s black list, and during this election season people have been viewing 333,000 pages a day.

Last year, Mr. Kahlow said, F.T.C. investigators asked him if he thought his site was a target of discrimination. No, he replied. But since then, he has watched Google promote its tools for finding where to vote and sample ballots, just like his site offers.

“At that time, I didn’t believe it was intentional, but I’m having second thoughts,” he says. “I’m sure they’re aware of the amount of money that’s being spent in politics and I’m sure they’d like to get their fingers in the pie.”

Google will not comment on its relations with specific Web sites. But a person briefed on its interactions with Vote-USA.org said Google had found additional duplication, like Michigan candidates showing up on the Iowa Web site. The person also said that hardly any other Web sites linked to Vote-USA.org, one of the most important elements in the algorithm.

EARLY last year, operators of small local news sites nationwide found that their number of readers had plummeted. Why? Their Web sites had disappeared from Google News, which in many cases was their No. 1 source of traffic.

Their owners wrote e-mail messages to Google and scoured online forums, to no avail.

“There was no explanation why or place you could go for more information,” says Hal Goodtree, editor and publisher of CaryCitizen, a local news site in Cary, N.C.

Google News, he says, brings traffic and credibility. “You’re legit if you’re on Google News,” he explains, “so it was painful.”

Lance Knobel, co-founder of Berkeleyside, a local news site in Berkeley, Calif., complained about the problem on Twitter, and a Berkeleyside reader who was a Google engineer eventually saw it. He promised Mr. Knobel he would look into it, unofficially.

Twelve hours later, Berkeleyside reappeared in Google News. Google said dropping the site was an error.

In North Carolina, Mr. Goodtree heard nothing for months about what had happened. In June, he received an e-mail from Google saying it was “unable to provide specifics” about why the site had been dropped.

Then, in August, Google wrote, “We recently reviewed your site again and have decided to add it to Google News once more.” No further explanation was given. Traffic to CaryCitizen jumped 24 percent. Mr. Knobel, in California, says of Google: “It’s a totally opaque corporation.”

Mr. Cutts of Google says it is impossible for the company to respond individually to every Web site owner with a question, because of sheer scale; there are 240 million domain names and people search Google more than 3.3 billion times a day.

Yet Google is trying to do more, he says. Last year, it started hosting video chats for Web site owners to ask questions. It has also started publishing blog posts about changes in the algorithm and broadcast eight minutes of a top-secret meeting about it.

“We try very hard to make sure we communicate with Webmasters,” Mr. Cutts says. For instance, he says, he reassured Gawker Media that it would remain in search results after Hurricane Sandy caused it to crash.

Google does not compete with sites like CaryCitizen and Berkeleyside in the labor-intensive chore of reporting and writing local news. But local news sites, notes Mr. Knobel of Berkeleyside, do compete in their way with Google for local advertising.

As the company builds up Google Plus Local, its local business listing and review service, Mr. Knobel says Google’s search engine could give the Internet giant “a tremendous advantage.” That would result, he says, if a person seeking information about a local business is steered to Google Plus Local rather than to small sites like Berkeleyside or sizable services like Yelp.

At the Arizona conference, Mr. Page was asked about Google’s competition with other Web businesses. “That’s always a hard question,” he replied, but not a new one. He pointed to Google Maps, which was introduced in 2005. “If you think back then,” he said, “we had the same kind of criticisms, like ‘Oh, there’s already MapQuest.’ Anybody heard of them? No one uses them anymore.”

Today, MapQuest has half the number of monthly visitors as Google Maps, according to comScore.

GOOGLE’S overriding goal, Mr. Page suggests, is continual improvement of its product, which, he says, means adding more services that collect and parse data. Some competitors may suffer. But, he adds, “our job is to serve users.”

Google has argued that forcefully to regulators because in antitrust, consumer benefit weighs heavily. But this is an evasion to competitors like Mr. Katz of Nextag, who has been questioned by regulators. He says Google increasingly presents itself as a commerce site as much as a search engine, pointing to changes that occurred mainly in the last year or two.

Today, if you Google a phrase like “patio furniture,” the results are not just a list of blue links to other Web sites. Instead, you will find a few ads, shaded in beige to identify them. On the right side of the page are product pictures and links to merchants, part of Google Shopping. Below Google Shopping is a Google map with locations of local stores. Then, sprawled down the page, are the blue links.

The effect, Mr. Katz says, is that Google commerce services get more of the prime real estate near the top of the screen. That means that even if Nextag ranks high in the organic search results, which costs him nothing, a user is less likely to see the link. He and his team also say changes in Google’s algorithm in recent months have hurt Nextag.

His Google traffic now costs more. Two years ago, 60 percent of Nextag’s traffic from Google was from free search and 40 percent paid — people clicking on ads Nextag bought. Today, it is 30 percent free and 70 percent paid.

But his company has also shifted its strategy to become less vulnerable to Google’s charge into commerce. It has invested heavily in its underlying technology to help Web sites attract visitors, especially ones most likely to buy their goods.

Wize Commerce, the Nextag owner, is based in San Mateo, Calif.; it is profitable and employs 450 people. The revised plan, Mr. Katz says, “gives us a shot at being a very healthy company,” less dependent on Google.

    Google Casts a Big Shadow on Smaller Web Sites, NYT, 3.11.2012,
    http://www.nytimes.com/2012/11/04/technology/google-casts-a-big-shadow-on-smaller-web-sites.html

Microsoft Seeks an Edge in Analyzing Big Data

October 29, 2012
The New York Times
By QUENTIN HARDY

SEATTLE — Eric Horvitz joined Microsoft Research 20 years ago with a medical degree, a Ph.D. in computer science and no plans to stay. “I thought I’d be here six months,” he said.

He remained at M.S.R., as Microsoft’s advanced research arm is known, for the fast computers and the chance to work with a growing team of big brains interested in cutting-edge research. His goal was to build predictive software that could get continually smarter.

In a few months, Mr. Horvitz, 54, may get his long-awaited payoff: the advanced computing technologies he has spent decades working on are being incorporated into numerous Microsoft products.

Next year’s version of the Excel spreadsheet program, part of the Office suite of software, will be able to comb very large amounts of data. For example, it could scan 12 million Twitter posts and create charts to show which Oscar nominee was getting the most buzz.

A new version of Outlook, the e-mail program, is being tested that employs Mr. Horvitz’s machine-learning specialty to review users’ e-mail habits. It could be able to suggest whether a user wants to read each message that comes in.

Elsewhere, Microsoft’s machine-learning software will crawl internal corporate computer systems much the way the company’s Bing search engine crawls the Internet looking for Web sites and the links among them. The idea is to predict which software applications are most likely to fail when seemingly unrelated programs are tweaked.

If its new products work as advertised, Microsoft will find itself in a position it has not occupied for the last few years: relevant to where technology is going.

While researchers at M.S.R. helped develop Bing to compete with Google, the unit was widely viewed as a pretty playground where Bill Gates had indulged his flights of fancy. Now, it is beginning to put Microsoft close to the center of a number of new businesses, like algorithm stores and speech recognition services. “We have more data in many ways than Google,” said Qi Lu, who oversees search, online advertising and the MSN portal at Microsoft.

M.S.R. owes its increased prominence as much to the transformation of the computing industry as to its own hard work. The explosion of data from sensors, connected devices and powerful cloud computing centers has created the Big Data industry. Computers are needed to find patterns in the mountains of data produced each day.

“Everything in the world is generating data,” said David Smith, a senior analyst with Gartner, a technology research firm. “Microsoft has so many points of presence, with Windows, Internet Explorer, Skype, Bing and other things, that they could do a lot. Analyzing vast amounts of data could be a big business for them.”

Microsoft is hardly alone among old-line tech companies in injecting Big Data into its products. Later this year, Hewlett-Packard will showcase printers that connect to the Internet and store documents, which can later be searched for new information. I.B.M. has hired more than 400 mathematicians and statisticians to augment its software and consulting. Oracle and SAP, two of the largest suppliers of software to businesses, have their own machine-learning efforts.

In the long term, Microsoft hopes to combine even more machine learning with its cloud computing system, called Azure, to rent out data sets and algorithms so businesses can build their own prediction engines. The hope is that Microsoft may eventually sell services created by software, in addition to the software itself.

“Azure is a real threat to Amazon Web Services, Google and other cloud companies because of its installed base,” said Anthony Goldbloom, the founder of Kaggle, a predictive analytics company. “They have data from places like Bing and Xbox, and in Excel they have the world’s most widely used analysis software.”

Like other giants, Microsoft also has something that start-ups like Kaggle do not: immense amounts of money — $67 billion in cash and short-term investments at the end of the last quarter — and the ability to work for 10 years, or even 20, on a big project.

It has been a long trip for Microsoft researchers. M.S.R. employs 850 Ph.D.’s in 13 labs around the world. They work in more than 55 areas of computing, including algorithm theory, cryptography and computational biology.

Machine learning involves computers deriving meaning and making predictions from things like language, intentions and behavior. When search engines like Google or Bing offer “did you mean?” alternatives to a misspelled query, they are employing machine learning. Mr. Horvitz, now a distinguished scientist at M.S.R., uses machine learning to analyze 25,000 variables and predict hospital patients’ readmission risk. He has also used it to deduce the likelihood of traffic jams on a holiday when rain is expected.

Mr. Horvitz started making prototypes of the Outlook assistant about 15 years ago. He keeps digital records of every e-mail, appointment and phone call so the software can learn when his meetings might run long, or which message he should answer first.

“Major shifts depend on incremental changes,” he said.

At a retreat in March, 100 top Microsoft executives were told to think of new ways that machine learning could be used in their businesses.

“It’s exciting when the sales and marketing divisions start pulling harder than we can deliver,” Mr. Horvitz said. “Magic in the first go-round becomes expectation in the next.”

    Microsoft Seeks an Edge in Analyzing Big Data, NYT, 29.10.2012,
    http://www.nytimes.com/2012/10/30/technology/microsoft-renews-relevance-with-machine-learning-technology.html

Tracking Voters’ Clicks Online to Try to Sway Them

October 27, 2012
The New York Times
By NATASHA SINGER and CHARLES DUHIGG

A few weeks ago, Thomas Goddard, a community college student in Santa Clara, Calif., and a devoted supporter of President Obama, clicked on mittromney.com to check out the candidate’s position on abortion.

Then, as he visited other Web sites, he started seeing advertisements asking him to donate to Mitt Romney’s campaign. One mentioned family values, he said, and seemed aimed at someone with more conservative leanings.

“It doesn’t make any sense,” Mr. Goddard said. “I’m the opposite of a Romney supporter. But ever since I went to the Romney site, they’ve been following me.”

One of the hallmarks of this campaign is the use of increasingly sophisticated — but not always accurate — data-mining techniques to customize ads for voters based on the digital trails they leave as they visit Internet sites.

It is a practice pioneered by online retailers who work with third-party information resellers to create detailed portraits of consumers, all the better to show them relevant marketing pitches. Mr. Goddard, for example, may have received those Romney ads because of “retargeting” software designed to show people ads for certain sites or products they have previously viewed.

Now, in the election’s final weeks, both presidential campaigns have drastically increased their use of such third-party surveillance engines, according to Evidon, a company that helps businesses and consumers monitor and control third-party tracking software.

Over the month of September, Evidon identified 76 different tracking programs on barackobama.com — two more trackers than it found on Best Buy’s Web site — compared with 53 in May. It found 40 different trackers on mittromney.com last month, compared with 25 in May.

The report provides a rare glimpse into the number of third-party tracking programs that are operating on the campaign Web sites — as many as or more than on some of the most popular retailers’ sites.

The campaigns directly hire some companies, like ad agencies or data management firms, that marry information collected about voters on a campaign site with data about them from other sources. But these entities, in turn, may bring their own software partners to the sites to perform data-mining activities like retargeting voters or tracking the political links they share with their social networks.

Now some consumer advocates say the proliferation of these trackers raises the risk that information about millions of people’s political beliefs could spread to dozens of business-to-business companies whose names many voters have never even heard. There is growing concern that the campaigns or third-party trackers may later use that voter data for purposes the public never imagined, like excluding someone from a job offer based on his or her past political affiliations.

“Is the data going to be sold to marketers or shared with other campaigns?” said Christopher Calabrese, the legislative counsel for privacy-related issues at the American Civil Liberties Union. “We simply don’t know how this information is going to be used in the future and where it is going to end up.”

Evidon offers a free software program called Ghostery that people can use to identify third-party trackers on the sites they visit. On Oct. 18 the program identified 19 different trackers on the Obama Web site and 12 on the Romney site. A reporter contacted 10 for comment.

Among those who responded, Cassie Piercey, a spokeswoman for ValueClick, whose MediaPlex marketing analytics division was identified as operating on the Obama site by Ghostery, said she could not comment on specific clients and referred a reporter to the company’s privacy policy. The policy says that ValueClick may collect information about users — like their Internet Protocol addresses, Web browsing histories, online purchases and searches — that does not involve identifiable information like their names, and that the company may share that data with its clients and marketing partners.

Adam Berke, the president of AdRoll, an advertising and retargeting company identified by Evidon on the Obama site, said the company did not aggregate user data or share it with other clients.

Meanwhile, Nanda Kishore, the chief technology officer of ShareThis, a service found on the Romney site by Ghostery that collects information about the links visitors share with their social networks, said the company collects only “anonymous” information about users and does not share or sell it.

The privacy policies on the campaigns’ Web sites acknowledge that they work with third parties that may collect user data.

Evidon executives said the tracking companies on the campaign sites included services that collect details about people’s online behavior in order to help mold ads to their political concerns; advertising networks that track people’s browsing history to measure the effectiveness of ads; and companies that record user behavior so they can analyze the effectiveness of sites to attract and hold on to Web traffic.

Officials with both campaigns emphasize that such data collection is “anonymous” because third-party companies use code numbers, not real names, to track site visitors.

Adam Fetcher, a spokesman for the Obama campaign, said the Web site does not allow its partners to share data collected from visitors with other clients or use it for other purposes like marketing consumer goods.

“We are committed to protecting individual privacy and employ strong safeguards to protect personal information,” Mr. Fetcher wrote in an e-mail. “We do not provide any personal information to outside entities, and we stipulate that third-party partners not use data collected on the site for other purposes.”

In response to a reporter’s query about whether the Romney site placed limitations on the collection or use of voter data by its partners, Ryan Williams, a campaign spokesman, wrote in an e-mail: “The Romney campaign respects the privacy rights of all Americans. We are committed to ensuring that all of our voter outreach is governed by the highest ethical standards.”

Evidon compiled the statistics on campaign tracking by aggregating data from a panel of about seven million volunteers who use its Ghostery program.

From May to September, Evidon identified 97 tracking programs — “far more than the average site employs,” a company report said — on the Obama and Romney sites combined. (Some trackers appeared on both sites.)

The campaigns’ increased use of tracking technology represents “a significant windfall for online data collectors and ad targeting companies,” Andy Kahl, the director of consumer products at Evidon, wrote in the report. But, he added, “the campaigns need to realize that being on top of which technology partners are appearing on their site, and ensuring clarity into what these partners can and can’t do with the data, is essential.”

Industry executives say the campaigns simply use data-mining to show the most relevant message to each voter.

“Political campaigns now for the first time can actually reach out to prospective voters with messaging that addresses each person’s specific interests and causes,” according to a recent report from the Interactive Advertising Bureau, a trade group.

But privacy advocates say such personalization raises questions about transparency.

“Individual voters may not be aware that the message they are getting is based on information that has been gleaned about their activities around the Web and is precisely targeted to them,” said Mr. Calabrese of the A.C.L.U. “It may be a private message just for me that is not the type of statement the campaign makes publicly.”

While some voters may be turned off by the customized campaign appeals, for others, they are expected.

“Companies are doing it, why shouldn’t campaigns?” said Michael James, a New Jersey high school teacher who visited both campaign sites this year to determine whom he would support. “The Internet has changed privacy. We can’t expect either campaign to pretend we’re living in the past.”

    Tracking Voters’ Clicks Online to Try to Sway Them, NYT, 27.10.2012,
    http://www.nytimes.com/2012/10/28/us/politics/tracking-clicks-online-to-try-to-sway-voters.html

In Web Search, Be Efficient in the Terms You Use

October 24, 2012
The New York Times
By THOMAS J. FITZGERALD

By this point in the Internet era, everyone should know how to find information on the Web with a search engine like Google or Bing.

Easy, right? Just type what you are looking for in the little box.

There are even easier ways. Google and Bing have built right into their search boxes tools like calculators, currency converters and dictionaries. They developed a host of tricks you can use to slice through clutter to reach the information you need. In some cases the results appear right away; you don’t need to touch the enter key. Many of the shortcuts work with the Web browsers on smartphones and tablets.

“We really try to make Bing a place where you can go to get stuff done in the real world,” said Stefan Weitz, senior director of Bing, Microsoft’s search engine and chief rival to Google. “People expect search now to actually do a better job connecting them to the ultimate destination.” If you need any additional help, Google also offers online tutorials.

TRAVEL TOOLS A fast way to find driving directions with Google is to type your query directly in the search box, using the following format: from 1380 Mass Ave, Cambridge, MA to 815 Boylston Street, Boston. The result is a map along with driving distance, trip time and a link to directions.

If you are planning air travel, you can track fares and be directed to sites for ticket purchases. In the Google search box, type airport codes in the following way: BOS to ABQ. An initial listing of flights appears, along with drop-down calendars to select departure and return dates.

If you click on the “Flights from Boston to Albuquerque” link, you arrive at a more extensive tool for finding flight information, including a lowest fares calculator, available by clicking the small graph-shaped button, or an interactive map, by clicking the balloon button, where you can choose among different departure or destination cities.

Bing’s tool for air travel can be found using the same format of entering airport codes in the search box, and when you drill down further you have choices of buying tickets through sources like Travelocity, Priceline and Expedia.

With either Bing or Google, you can quickly check flight status using the following format: Delta flight status 1512.

Also useful for travelers are language translation tools. In either Bing or Google, use the following format: translate coffee to Turkish. The result, kahve, appears, and if you click the first link you can find tools for translating words into dozens of languages.

Converting currencies is also available by using the following format in either search engine: 100 U.S. dollars in Indian rupees.

In both search engines, to book reservations at restaurants, the search results for a restaurant in a major city will often include a link to OpenTable, a provider of restaurant reservations. (You may need to add a ZIP code or a city name for common names.) The right-hand column might also have other information like reviews and maps.

SOCIAL NETWORKS Both Google and Microsoft have been trying to figure out how best to interact with the trove of information locked away in social networking sites like Facebook, LinkedIn and Twitter.

Microsoft has entered into partnerships with Facebook and others allowing Bing users to connect with people who may know something about their search query. You can log into a Facebook account from the Bing home page, and while you search in Bing, a sidebar appears along the right side of the results page that may display Facebook friends who have some relationship to your search.

If your query is “Mexican restaurants in San Antonio,” and you hover over the image of a friend, you may see a Facebook comment or photo of their favorite place for good mole.

Google has its own social networking service, Google Plus, which enables users to share their favorite search results with friends also on the service.

SPECIALIZED SEARCHES Much has changed since the early days of search engines, and given the vastness of data now available online, knowing a few simple yet powerful shortcuts can pinpoint information more relevant to your search.

You can dig through the Web for specific kinds of files, for example PowerPoint files related to the Affordable Care Act. In Google use the format filetype:ppt the affordable care act. (The ppt part of the query is the extension for PowerPoint files.) Other popular extensions are docx, xlsx and pdf, for Word, Excel and PDF files. Bing flips the search format — type the affordable care act filetype:ppt.

Another very useful way to dig for information is to use the prefix site: to search within a site. For example, type site:washingtonpost.com Mitt Romney to get links to articles, blog posts and other references to Mitt Romney that appeared in The Washington Post. Bing reverses the format — type Mitt Romney site:washingtonpost.com.

To save time, in some instances you can preview information in search results. To preview videos without having to click on them, in the results page of Bing hover over the image of a video and in many cases it will play. And in Google you can see previews of Web pages by moving the cursor to the right of a search result and hovering over a small image of double arrows.

FINDING FACTS If you need a calculator, both Google and Bing can calculate some pretty fancy math queries by entering them in the search box, but Google goes further. Type 4 * 24 in Google and the answer appears as you finish typing, and below that emerges an in-browser calculator with scientific functions. You can also turn Google’s search box into a trigonometric graphing calculator; type, for example, cos(x) + cos(y) and a rotating three-dimensional graph is displayed. From there you can size the graph or grab it to view it from different angles.

Converting measurements is easy using the following format in either search engine: pints in a gallon; centimeters in a foot.

Stock prices are available in either Google or Bing by entering a stock symbol — followed by “stock” if there is any ambiguity. For example aapl stock or sbux stock, pulls up prices of Apple or Starbucks. In Google, using a company name works: Whole Foods stock.

Dictionaries are available as well by using the following format: define perspicacity.

Weather forecasts are quickly at hand by entering a ZIP code or city name, in either Google or Bing, as in weather Denver.

Likewise, to find movies playing in your area, all you need is your ZIP code: movies 10018. (Type in an actor or director followed by the word movies to see what else he or she did.)

But, if you are looking for someone to take out to a movie and impress with all your newfound knowledge, there is no search algorithm just yet. For that, you are still on your own.

    In Web Search, Be Efficient in the Terms You Use, NYT, 25.10.2012,
    http://www.nytimes.com/2012/10/25/technology/personaltech/tips-to-search-smarter-and-faster.html

Credit Card Data Breach at Barnes & Noble Stores

October 23, 2012
The New York Times
By MICHAEL S. SCHMIDT and NICOLE PERLROTH

WASHINGTON — Hackers have stolen credit card information for customers who shopped as recently as last month at 63 Barnes & Noble stores across the country, including stores in New York City, San Diego, Miami and Chicago, according to people briefed on the investigation.

The company discovered around Sept. 14 that the information had been stolen but kept the matter quiet at the Justice Department’s request so the F.B.I. could determine who was behind the attacks, according to these people.

The information was stolen by hackers who broke into the keypads in front of registers where customers swipe their credit cards and enter their personal identification numbers, or PINs.

In response to questions about the attack, the company acknowledged the security breach, saying that as a precaution customers who used their cards at any of the 63 Barnes & Noble where information was stolen should change their PINs and scan their accounts for unauthorized transactions.

A high-ranking official for the company said that hackers had used information from some customers’ credit cards to make unauthorized purchases, but that activity had mainly occurred in September and had declined in recent weeks.

The official defended the company’s decision not to tell its customers about the attack, saying that the company had informed credit card companies that certain accounts might have been compromised.

“We have acted at the direction of the U.S. government and they have specifically told us not to disclose it, and there we have complied,” said the official, who asked not to be identified because the investigation was continuing.

The company has received two letters from the United States attorney’s office for the Southern District of New York that said it did not have to report the attacks to its customers during the investigation, according to the official. At least one of the letters said that the company could wait until Dec. 24 to tell the customers.

As the company tried to determine how the attack occurred, it turned off all 7,000 keypads in its several hundred stores and had them shipped to a site where the company could examine them.

The company determined that only one keypad in each of the 63 stores had been hacked. Nevertheless, the company has not reinstalled the devices.

“Right now, we have no PIN pads in any stores and we are O.K. with that,” the company official said.

Customers who want to use credit and debit cards now have to ask cashiers to swipe their cards on the readers connected to the registers.

The company said that purchases at its college bookstores and on BarnesandNoble.com, Nook, Nook mobile apps and its member database were not affected by the hacking. It did not say, however, whether it would now be telling individual customers that their information had been stolen.

While specifics differ, most states, including California, require that companies notify customers of a breach if their names are compromised in combination with other information such as a credit card, a Social Security number or a driver’s license number.

But states make an exception for encrypted information. As long as companies wrap consumer information in basic encryption, laws do not require them to tell customers about a breach.

“If you had a breach that included name plus credit card information, but the credit card information was encrypted, you would not have to provide notice,” said Miriam H. Wugmeister, a lawyer with Morrison & Foerster.

Computer security experts say such an attack entails a multilayered assault.

“This is no small undertaking,” said Edward Schwartz, the chief security officer at RSA, a security company. “An attack of this type involves many different phases of reconnaissance and multiple levels of exploitation.”

Barnes & Noble did not offer more information on how its network was penetrated. Security experts said a company insider could have inserted malicious code, or criminals could have persuaded an unsuspecting employee to click on a malicious link that installed malware, giving the perpetrators a foothold into Barnes & Noble’s point-of-sale systems.

“Attacks on point-of-sale systems are growing exponentially,” said Tom Kellermann, a vice president at the security company Trend Micro. Mr. Kellermann said this was, in large part, because encryption no longer provided a deterrent for skilled hackers.

Michael S. Schmidt reported from Washington and Nicole Perlroth from San Francisco.

    Credit Card Data Breach at Barnes & Noble Stores, NYT, 23.10.2012,
    http://www.nytimes.com/2012/10/24/business/hackers-get-credit-data-at-barnes-noble.html

Fresh Windows, but Where’s the Start Button?

October 21, 2012
The New York Times
By NICK WINGFIELD

Over the years, Keith McCarthy has become used to a certain way of doing things on his personal computers, which, like most others on the planet, have long run on Microsoft’s Windows software.

But last week, when he got his hands on a laptop running the newest version of Windows for the first time, Mr. McCarthy was flummoxed.

Many of the familiar signposts from PCs of yore are gone in Microsoft’s new software, Windows 8, like the Start button for getting to programs and the drop-down menus that list their functions.

It took Mr. McCarthy several minutes just to figure out how to compose an e-mail message in Windows 8, which has a stripped-down look and on-screen buttons that at times resemble the runic assembly instructions for Ikea furniture.

“It made me feel like the biggest amateur computer user ever,” said Mr. McCarthy, 59, a copywriter in New York.

Windows, which has more than a billion users around the world, is getting a radical makeover, a rare move for a product with such vast reach. The new design is likely to cause some head-scratching for those who buy the latest machines when Windows 8 goes on sale this Friday.

To Microsoft and early fans of Windows 8, the software is a fresh, bold reinvention of the operating system for an era of touch-screen devices like the iPad, which are reshaping computing. Microsoft needs the software to succeed so it can restore some of its fading relevance after years of watching the likes of Apple and Google outflank it in the mobile market.

To its detractors, though, Windows 8 is a renovation gone wrong, one that will needlessly force people to relearn how they use a device every bit as common as a microwave oven.

“I don’t think any user was asking for that,” said John Ludwig, a former Microsoft executive who worked on Windows and is now a venture capitalist in the Seattle area. “They just want the current user interface, but better.”

Mr. Ludwig said Microsoft’s strategy was risky, but it had to do something to improve its chances in the mobile business: “Doing nothing was a strategy that was sure to fail.”

Little about the new Windows will look familiar to those who have used older versions. The Start screen, a kind of main menu, is dominated by a colorful grid of rectangles and squares that users can tap with a finger or click with a mouse to start applications. Many of these so-called live tiles constantly flicker with new information piped in from the Internet, like news headlines and Facebook photos.

What is harder to find are many of the conventions that have been a part of PCs since most people began using them, like the strip of icons at the bottom of the screen for jumping between applications. The mail and calendar programs are starkly minimalist. It is as if an automaker hid the speedometer, turn signals and gear shift in its cars, and told drivers to tap their dashboards to reveal those functions. There is a more conventional “desktop” mode for running Microsoft Office and older programs, though there is no way to permanently switch to it.

Microsoft knew in the summer of 2009 that it wanted to shake up Windows. It held focus groups and showed people prototypes of the tile interface and its live updates.

“We would get this delightful reaction of people who would say, ‘This is so great, and it has Office too,’ ” said Jensen Harris, Microsoft’s director of program management for the Windows user experience.

Sixteen million people have been using early versions of the software. The boldness of the changes has delighted some users, who say they believe that for the first time, the company is taking greater creative risks than its more celebrated rival, Apple.

“I think it’s functional, clean,” said Andries van Dam, a pioneer in computer graphics and a Brown University computer science professor, who receives research money from Microsoft. “I welcome it.”

Younger users may be more likely to embrace the new approach. Joanna Lin, 23, who works in sales and marketing for a hotel chain in New York, said she was impressed with the software. “The feeling was very fluid,” said Ms. Lin, who was the most enthusiastic of five people that The New York Times asked to briefly try Windows 8 last week. “Definitely a step up from Windows 7.”

But the product is a major gamble for Microsoft, a company whose clout in the technology industry has been waning. The PC business, which generates much of Microsoft’s revenue, is in a severe slump as newer products like smartphones and tablets take more dollars from peoples’ wallets.

To help it gain traction in the mobile market, Microsoft made Windows 8 a one-size-fits-all operating system for touch-screen tablets, conventional computers with keyboards and mice, and newer devices that combine elements of both. (Confusingly, Microsoft is also introducing a separate but similar operating system, Windows RT, that cannot run older programs.)

Apple took the opposite approach with the Mac and mobile devices like the iPad, which have distinct interfaces, albeit with some shared technologies. Timothy D. Cook, Apple’s chief executive, has said of Microsoft’s strategy: “You can converge a toaster and refrigerator, but these things are probably not going to be pleasing to the user.”

Jakob Nielsen, a user interface expert at the Nielsen Norman Group, conducted tests with four people who used a traditional computer running Windows 8 and found that they had “a lot of struggles” with the new design. Mr. Nielsen said they appeared to become especially confused when shifting back and forth between the modern Windows 8 mode and the desktop mode.

Mr. Nielsen said Windows 8 was more suitable for tablet computers with their smaller displays, but it was not helpful for workers who needed to have lots of applications visible at once.

“I just think when it comes to the traditional customer base, the office computer user, they’re essentially being thrown under the bus,” Mr. Nielsen said.

Microsoft disputes this idea. Mr. Harris said most test users did not have trouble juggling the two modes — and regardless, workers were more likely to operate in desktop mode if they wanted to see many applications simultaneously.

Microsoft is convinced that most people will quickly become accustomed to Windows 8. But to help ease the transition, the software offers tutorials when it is first started up. And Microsoft is spending more than $500 million on a marketing campaign that is partly intended to familiarize people with the new design.

Mr. Harris said the company needed to modernize Windows for the way people use computers today: “We’re not surprised people have a strong reaction to it.”

    Fresh Windows, but Where’s the Start Button?, NYT, 21.10.2012,
    http://www.nytimes.com/2012/10/22/technology/windows-staple-of-most-pcs-gets-a-major-makeover.html

No Need to Crowd In. We Can All Talk to Mom.

October 20, 2012
The New York Times
By ANNE EISENBERG

PEOPLE have long used webcams on their laptop and desktop computers to add live video to Internet calls. But the face-to-face chats often include grainy, low-resolution images and much crowding around the computer when the whole family wants to get in the picture.

Now wide-angle cameras that pop onto large-screen televisions are on the market; they capture high-definition video and a generous stretch of the living room sofa, too. Several devices, including the TV Cam HD ($199.99) from Logitech, are already on sale, with at least a half-dozen others expected in time for the holiday shopping season, said Richard Doherty, research director of the Envisioneering Group, a market research company in Seaford, N.Y.

The new TV cams are for people who want to add an Internet-based feature to their high-definition TV’s. “You can add this capability for a few hundred dollars or less,” Mr. Doherty said. “Lots of people have HDTVs they’ve bought in the last few years, and they aren’t going to get rid of them for Internet TVs.”

Internet-enabled TVs have software for video chatting, but many models require viewers to buy a suitable add-on camera.

Logitech’s TV Cam HD works with any high-definition television that has an available HDMI port, a common connection. It comes with connectivity to the Internet by way of Ethernet or Wi-Fi, and Skype software that supports high-definition video calling. To control the camera, you use a small remote control to zoom in or pan during a call, or to enter text on the screen.

Mr. Doherty says the new cams have crisp images and an enlarged field of view. “It can pack a real emotional punch when a loved one’s face appears on the big expanse of an HDTV,” he said. “And when you can watch sitting on the couch with the rest of your family, it’s a pleasant, relaxing experience.”

To try out the Logitech cam, I asked a neighbor, Li Wah Lai, a Manhattan-based graphic designer who has tested earlier generations of webcams, to use it for a video visit with her son Ming Alterman, a marketing manager for Coca-Cola in Shanghai.

“It was a totally different family experience from our usual laptop talk,” Ms. Lai said. She and her husband, Daniel Alterman, as well as their younger son, Mickey, all joined in for the Sunday-morning video chat with Ming. “I thought it would be the same,” she said. “But it wasn’t.”

There was no jostling in front of the camera, as there typically is when using a laptop, to guarantee that everyone could be seen and heard.

“It was very relaxing,” she said. They did not have to constantly ask Ming: “Can you see us? Can you hear us?”

And Ming became more comfortable, too, she said: “It was more of a family event.”

Clifford I. Nass, a Stanford communication professor, said the sight of familiar faces in high definition was especially appealing.

“It’s not just the pixels,” he said. “It’s the ability to detect facial expressions more accurately. The brain loves having this kind of information.”

THE wide-angle lens could also contribute to the emotional impact of video chatting, said Jeremy Bailenson, director of the Virtual Human Interaction Lab at Stanford. A generous field of view, he said, “plays a big part in creating the feeling that the digital other you are talking with is actually in the room with you.”

The wide field of view permits more glimpses of nonverbal interactions, he said, like the exchange of glances during the chat.

With the Logitech device, all calls are placed and received by using the remote control. Because there is no keyboard, entering text can be tedious: you have to click up, down, right or left on the remote, for example, to select each letter of the name of new Skype contacts from a keyboard projected on the screen. Ms. Lai started off slowly with this skill, but within minutes her fingers were flying.

You can also use the remote to adjust the image you are projecting, zooming in, panning or tilting.

The device requires users to have Skype service. which is free for calls between its users. Incoming calls to the cam will ring out even when the television is turned off — you’ll need to grab the remote and turn on the TV.

And if you are still in your bathrobe, you can also leave the call for voice mail.

    No Need to Crowd In. We Can All Talk to Mom., NYT, 20.10.2012,
    http://www.nytimes.com/2012/10/21/technology/new-webcams-add-wide-angle-video-calls-to-your-tv.html

Panetta Warns of Dire Threat of Cyberattack on U.S.

October 11, 2012
The New York Times
By ELISABETH BUMILLER and THOM SHANKER

Defense Secretary Leon E. Panetta warned Thursday that the United States was facing the possibility of a “cyber-Pearl Harbor” and was increasingly vulnerable to foreign computer hackers who could dismantle the nation’s power grid, transportation system, financial networks and government.

In a speech at the Intrepid Sea, Air and Space Museum in New York, Mr. Panetta painted a dire picture of how such an attack on the United States might unfold. He said he was reacting to increasing aggressiveness and technological advances by the nation’s adversaries, which officials identified as China, Russia, Iran and militant groups.

“An aggressor nation or extremist group could use these kinds of cyber tools to gain control of critical switches,” Mr. Panetta said. “They could derail passenger trains, or even more dangerous, derail passenger trains loaded with lethal chemicals. They could contaminate the water supply in major cities, or shut down the power grid across large parts of the country.”

Defense officials insisted that Mr. Panetta’s words were not hyperbole, and that he was responding to a recent wave of cyberattacks on large American financial institutions. He also cited an attack in August on the state oil company Saudi Aramco, which infected and made useless more than 30,000 computers.

But Pentagon officials acknowledged that Mr. Panetta was also pushing for legislation on Capitol Hill. It would require new standards at critical private-sector infrastructure facilities — like power plants, water treatment facilities and gas pipelines — where a computer breach could cause significant casualties or economic damage.

In August, a cybersecurity bill that had been one of the administration’s national security priorities was blocked by a group of Republicans, led by Senator John McCain of Arizona, who took the side of the U.S. Chamber of Commerce and said it would be too burdensome for corporations.

The most destructive possibilities, Mr. Panetta said, involve “cyber-actors launching several attacks on our critical infrastructure at one time, in combination with a physical attack.” He described the collective result as a “cyber-Pearl Harbor that would cause physical destruction and the loss of life, an attack that would paralyze and shock the nation and create a profound new sense of vulnerability.”

Mr. Panetta also argued against the idea that new legislation would be costly for business. “The fact is that to fully provide the necessary protection in our democracy, cybersecurity must be passed by the Congress,” he told his audience, Business Executives for National Security. “Without it, we are and we will be vulnerable.”

With the legislation stalled, Mr. Panetta said President Obama was weighing the option of issuing an executive order that would promote information sharing on cybersecurity between government and private industry. But Mr. Panetta made clear that he saw it as a stopgap measure and that private companies, which are typically reluctant to share internal information with the government, would cooperate fully only if required to by law.

“We’re not interested in looking at e-mail, we’re not interested in looking at information in computers, I’m not interested in violating rights or liberties of people,” Mr. Panetta told editors and reporters at The New York Times earlier on Thursday. “But if there is a code, if there’s a worm that’s being inserted, we need to know when that’s happening.”

He said that with an executive order making cooperation by the private sector only voluntary, “I’m not sure they’re going to volunteer if they don’t feel that they’re protected legally in terms of sharing information.”

“So our hope is that ultimately we can get Congress to adopt that kind of legislation,” he added.

Mr. Panetta’s comments, his most extensive to date on cyberwarfare, also sought to increase the level of public debate about the Defense Department’s growing capacity not only to defend but also to carry out attacks over computer networks. Even so, he carefully avoided using the words “offense” or “offensive” in the context of American cyberwarfare, instead defining the Pentagon’s capabilities as “action to defend the nation.”

The United States has nonetheless engaged in its own cyberattacks against adversaries, although it has never publicly admitted it. From his first months in office, Mr. Obama ordered sophisticated attacks on the computer systems that run Iran’s main nuclear enrichment plants, according to participants in the program. He decided to accelerate the attacks, which were begun in the Bush administration and code-named Olympic Games, even after an element of the program accidentally became public in the summer of 2010.

In a part of the speech notable for carefully chosen words, Mr. Panetta warned that the United States “won’t succeed in preventing a cyberattack through improved defenses alone.”

“If we detect an imminent threat of attack that will cause significant physical destruction in the United States or kill American citizens, we need to have the option to take action against those who would attack us, to defend this nation when directed by the president,” Mr. Panetta said. “For these kinds of scenarios, the department has developed the capability to conduct effective operations to counter threats to our national interests in cyberspace.”

The comments indicated that the United States might redefine defense in cyberspace as requiring the capacity to reach forward over computer networks if an attack was detected or anticipated, and take pre-emptive action. These same offensive measures also could be used in a punishing retaliation for a first-strike cyberattack on an American target, senior officials said.

Senior Pentagon officials declined to describe specifics of what offensive cyberwarfare abilities the Defense Department has fielded or is developing. And while Mr. Panetta avoided labeling them as “offensive,” other senior military and Pentagon officials have recently begun acknowledging their growing focus on these tools.

The Defense Department is finalizing “rules of engagement” that would put the Pentagon’s cyberweapons into play only in case of an attack on American targets that rose to some still unspecified but significant levels. Short of that, the Pentagon shares intelligence and offers technical assistance to the F.B.I. and other agencies.

Elisabeth Bumiller reported from New York, and Thom Shanker from Washington.

    Panetta Warns of Dire Threat of Cyberattack on U.S., NYT, 11.10.2012,
    http://www.nytimes.com/2012/10/12/world/panetta-warns-of-dire-threat-of-cyberattack.html

Zuckerberg Meets With Medvedev in a Crucial Market

October 1, 2012
The New York Times
By ANDREW E. KRAMER

MOSCOW — The hoodie stayed back at the hotel when Mark Zuckerberg, the founder of Facebook, met Russia’s prime minister and former president, Dmitri A. Medvedev, on Monday.

“Good conversation with Prime Minister Medvedev,” Mr. Zuckerman wrote on his Facebook wall beside a picture of the two, in suits and grinning, at the Russian leader’s residence outside Moscow.

Mr. Zuckerberg also visited Red Square — in his hoodie — ate at McDonald’s and helped judge a competition for Russian programmers under way in Moscow in his first visit to Russia, a country that is in important ways pivotal for Facebook.

One of Google’s founders, Sergey Brin, is Russian by birth. For Facebook, the tie is more oblique: The country is an important test case for the balancing act Facebook is undertaking as a new media company in countries that are important commercially but have traditionally heavily regulated their old media, if not censored it. And two of Facebook’s largest investors are Russian.

Mr. Zuckerberg and Mr. Medvedev talked about Facebook’s role in politics, though only jokingly in reference to its importance in the American presidential campaign, according to Mr. Medvedev’s press office.

They also discussed copyright rules and high-tech business. Mr. Zuckerberg gave the Russian leader a T-shirt; the meeting lasted about 20 minutes.

Facebook, in Russia as elsewhere, plays a double role as a tool for posting silly party pictures and a tool for political organizing.

Facebook played an integral role in political dissent in Russia last winter, allowing street protests to coalesce when handing out fliers or posting notices on corkboards would not have worked.

Russia is also home to two large and early Facebook investors, Alisher Usmanov, a steel tycoon, and Yuri Milner, an expert on monetizing social network traffic in emerging markets. The two partly cashed out in the initial public offering of Facebook stock earlier this year but still own billions of dollars’ worth of shares.

More Russians are online today than Germans, making Russia the largest Internet market in Europe. Russians also, strangely, have spent more freely relative to their income than Americans on virtual products, like special powers for online games, making their country a useful market for testing revenue streams other than advertising.

Earlier this month, in another step deeper into the Russian market, Facebook made a deal with one of Russia’s mobile phone operators, Beeline, to provide a free application to subscribers.

The Russian government, led by Mr. Medvedev, a technology lover, has embraced the Internet for its commercial potential even as it has been subtly trying to rein in the politics.

Such features as most-viewed lists of blogs, for example, are frowned on at Russian-run sites beholden to the Kremlin, lest a critical text go viral based on user approval.

In its prospectus for the initial public offering, Facebook had cautioned of the business risk of being banned from foreign markets, as it has been in China by the “Great Firewall.”

For now, Russia’s Internet is mostly unfettered.

In that spirit, pictures of the Facebook founder’s dog, Beast, which he posts on his Facebook page, became the topic of conversation in an episode Mr. Zuckerberg filmed for a Russian late-night comedy show on Monday.

    Zuckerberg Meets With Medvedev in a Crucial Market, NYT, 1.10.2012,
    http://www.nytimes.com/2012/10/02/technology/zuckerberg-meets-with-medvedev-in-key-market.html

Attacks on 6 Banks Frustrate Customers

September 30, 2012
The New York Times
By NICOLE PERLROTH

Six major American banks were hit in a wave of computer attacks last week, by a group claiming Middle Eastern ties, that caused Internet blackouts and delays in online banking.

Frustrated customers of Bank of America, JPMorgan Chase, Citigroup, U.S. Bank, Wells Fargo and PNC, who could not get access to their accounts or pay bills online, were upset because the banks had not explained clearly what was going on.

“It was probably the least impressive corporate presentation of bad news I’ve ever seen,” said Paul Downs, a small-business owner in Bridgeport, Pa. “This is extremely disconcerting.”

The banks suffered denial of service attacks, in which hackers barrage a Web site with traffic until it is overwhelmed and shuts down. Such attacks, while a nuisance, are not technically sophisticated and do not affect a company’s computer network — or, in this case, funds or customer bank accounts. But they are enough to upset customers.

A hacker group calling itself Izz ad-Din al-Qassam Cyber Fighters — a reference to Izz ad-Din al-Qassam, a Muslim holy man who fought against European forces and Jewish settlers in the Middle East in the 1920s and 1930s — took credit for the attacks in online posts.

The group said it had attacked the banks in retaliation for an anti-Islam video that mocks the Prophet Muhammad. It also pledged to continue to attack American credit and financial institutions daily, and possibly institutions in France, Israel and Britain, until the video is taken offline. The New York Stock Exchange and Nasdaq were also targeted.

On Friday, PNC became the latest bank to experience delays and fall offline. Customers said they had been unable to get access to PNC’s online banking site, and those that visited the bank’s physical locations were told it was because PNC, and many others, had been hacked.

Fred Solomon, a PNC spokesman, said Friday afternoon that the bank’s Web site was back online, but that it was still working to restore online bill payment. Asked why the bank was not better able to withstand such an attack, he said that while PNC had systems in place to prevent delays and disruption from hacker attacks, in this case “the volume of traffic was unprecedented.”

Representatives for other banks also confirmed that they had experienced slow Internet performance and intermittent downtime because of an unusually high volume of traffic.

Security researchers said the attack methods were too basic to have taken so many American bank sites offline. The hackers appeared to be enlisting volunteers for the attacks with messages on various sites. On one blog, they called on people to visit two Web addresses that would cause their computers to flood banks with hundreds of data requests a second. They asked volunteers to attack banks according to a timetable: Wells Fargo on Tuesday, U.S. Bancorp on Wednesday and PNC on Thursday.

But experts said it seemed implausible that this method would create an attack of this scale. “The number of users you need to break those targets is very high,” said Jaime Blasco, a security researcher at AlienVault who has been investigating the attacks. “They must have had help from other sources.”

Those sources, Mr. Blasco said, would have to be a group with money, like a nation, or botnets — networks of infected computers that do the bidding of criminals. Botnets can be rented through black market schemes that are common in the Internet underground, or lent out by criminals or governments.

Last week, Senator Joseph I. Lieberman of Connecticut, chairman of the Senate Homeland Security Committee, said in an interview on C-Span that he believed Iran’s government had sponsored the attacks in retaliation for Western economic sanctions. The hacker group rejected that claim. In an online post, it said the attacks had not been sponsored by a country and that its members “strongly reject the American officials’ insidious attempts to deceive public opinion.”

The hackers maintained that they were retaliating for the online video. “Insult to the prophet is not acceptable, especially when it is the last Prophet Muhammad,” they wrote.

It is very difficult to trace such attacks back to a particular country, security experts say, because they can be routed through different Internet addresses to mask their true origin.

But experts said they had seen an increase in such activity from Iran and in the number of so-called hacktivists, hackers who attack for political purposes rather than for profit, based in Iran.

“We absolutely have seen more activity from the Middle East, and in particular Iran has been increasingly active as they build up their cyber capabilities,” said George Kurtz, the president of CrowdStrike, a computer security company, and former chief technology officer at McAfee. “There is also a strong activist movement underfoot, which should be concerning to many large companies. The threat is real, and what we are seeing now is only the tip of the iceberg.”

James A. Lewis, a computer security expert at the Center for Strategic and International Studies, said that in this case, the attack methods used were “pretty basic” to have been state-sponsored. But he added that even if the attacks were not the work of Iran’s government, the state would be aware of them because Iran monitors its networks extensively.

For Mr. Downs, the small-business owner in Pennsylvania, such half explanations were of little consolation.

“A major bank has a problem and gives no indication of what’s happening, when it started or when it will stop,” he said. “That’s pretty freaky if it’s your own business’s money and you need to do things with it.”

    Attacks on 6 Banks Frustrate Customers, NYT, 30.9.2012,
    http://www.nytimes.com/2012/10/01/business/cyberattacks-on-6-american-banks-frustrate-customers.html

U.S. Is Tightening Web Privacy Rule to Shield Young

September 27, 2012
The New York Times
By NATASHA SINGER

Federal regulators are about to take the biggest steps in more than a decade to protect children online.

The moves come at a time when major corporations, app developers and data miners appear to be collecting information about the online activities of millions of young Internet users without their parents’ awareness, children’s advocates say. Some sites and apps have also collected details like children’s photographs or locations of mobile devices; the concern is that the information could be used to identify or locate individual children.

These data-gathering practices are legal. But the development has so alarmed officials at the Federal Trade Commission that the agency is moving to overhaul rules that many experts say have not kept pace with the explosive growth of the Web and innovations like mobile apps. New rules are expected within weeks.

“Today, almost every child has a computer in his pocket and it’s that much harder for parents to monitor what their kids are doing online, who they are interacting with, and what information they are sharing,” says Mary K. Engle, associate director of the advertising practices division at the F.T.C. “The concern is that a lot of this may be going on without anybody’s knowledge.”

The proposed changes could greatly increase the need for children’s sites to obtain parental permission for some practices that are now popular — like using cookies to track users’ activities around the Web over time. Marketers argue that the rule should not be changed so extensively, lest it cause companies to reduce their offerings for children.

“Do we need a broad, wholesale change of the law?” says Mike Zaneis, the general counsel for the Interactive Advertising Bureau, an industry association. “The answer is no. It is working very well.”

The current federal rule, the Children’s Online Privacy Protection Act of 1998, requires operators of children’s Web sites to obtain parental consent before they collect personal information like phone numbers or physical addresses from children under 13. But rapid advances in technology have overtaken the rules, privacy advocates say.

Today, many brand-name companies and analytics firms collect, collate and analyze information about a wide range of consumer activities and traits. Some of those techniques could put children at risk, advocates say.

Under the F.T.C.’s proposals, some current online practices, like getting children under 13 to submit photos of themselves, would require parental consent.

Children who visit McDonald’s HappyMeal.com, for instance, can “get in the picture with Ronald McDonald” by uploading photos of themselves and combining them with images of the clown. Children may also “star in a music video” on the site by uploading photos or webcam images and having it graft their faces onto dancing cartoon bodies.

But according to children’s advocates, McDonald’s stored these images in directories that were publicly available. Anyone with an Internet connection could check out hundreds of photos of young children, a few of whom were pictured in pajamas in their bedrooms, advocates said.

In a related complaint to the F.T.C. last month, a coalition of advocacy groups accused McDonald’s and four other corporations of violating the 1998 law by collecting e-mail addresses without parental consent. HappyMeal.com, the complaint noted, invites children to share their creations on the site by providing the first names and e-mail addresses of their friends.

“When we tell parents about this they are appalled, because basically what it’s doing is going around the parents’ back and taking advantage of kids’ naïveté,” says Jennifer Harris, the director of marketing initiatives at the Yale Rudd Center for Food Policy and Obesity, a member of the coalition that filed the complaint. “It’s a very unfair and deceptive practice that we don’t think companies should be allowed to do.”

Danya Proud, a spokeswoman for McDonald’s, said in an e-mail that the company placed a “high importance” on protecting privacy, including children’s online privacy. She said that McDonald’s had blocked public access to several directories on the site.

Last year, the F.T.C. filed a complaint against W3 Innovations, a developer of popular iPhone and iPod Touch apps like Emily’s Dress Up, which invited children to design outfits and e-mail their comments to a blog. The agency said that the apps violated the children’s privacy rule by collecting the e-mail addresses of tens of thousands of children without their parents’ permission and encouraging those children to post personal information publicly. The company later settled the case, agreeing to pay a penalty of $50,000 and delete personal data it had collected about children.

It is often difficult to know what kind of data is being collected and shared. Industry trade groups say marketers do not knowingly track young children for advertising purposes. But a study last year of 54 Web sites popular with children, including Disney.go.com and Nick.com, found that many used tracking technologies extensively.

“I was surprised to find that pretty much all of the same technologies used to track adults are being used on kids’ Web sites,” said Richard M. Smith, an Internet security expert in Boston who conducted the study at the request of the Center for Digital Democracy, an advocacy group.

Using a software program called Ghostery, which detects and identifies tracking entities on Web sites, a New York Times reporter recently identified seven trackers on Nick.com — including Quantcast, an analytics company that, according to its own marketing material, helps Web sites “segment out specific audiences you want to sell” to advertisers.

Ghostery found 13 trackers on a Disney game page for kids, including AudienceScience, an analytics company that, according to that company’s site, “pioneered the concept of targeting and audience-based marketing.”

David Bittler, a spokesman for Nickelodeon, which runs Nick.com, says Viacom, the parent company, does not show targeted ads on Nick.com or other company sites for children under 13. But the sites and their analytics partners may collect data anonymously about users for purposes like improving content. Zenia Mucha, a spokeswoman for Disney, said the company does not show targeted ads to children and requires its ad partners to do the same.

Another popular children’s site, Webkinz, says openly that its advertising partners may aim at visitors with ads based on the collection of “anonymous data.” In its privacy policy, Webkinz describes the practice as “online advanced targeting.”

If the F.T.C. carries out its proposed changes, children’s Web sites would be required to obtain parents’ permission before tracking children around the Web for advertising purposes, even with anonymous customer codes.

Some parents say they are trying to teach their children basic online self-defense. “We don’t give out birth dates to get the free stuff,” said Patricia Tay-Weiss, a mother of two young children in Venice, Calif., who runs foreign language classes for elementary school students. “We are teaching our kids to ask, ‘What is the company getting from you and what are they going to do with that information?’ ”

    U.S. Is Tightening Web Privacy Rule to Shield Young, NYT, 27.9.2012,
    http://www.nytimes.com/2012/09/28/technology/ftc-moves-to-tighten-online-privacy-protections-for-children.html

The Satanic Video

September 23, 2012
The New York Times
By BILL KELLER

THE alchemy of modern media works with amazing speed. Start with a cheesy anti-Muslim video that resembles a bad trailer for a Sacha Baron Cohen comedy. It becomes YouTube fuel for protest across the Islamic world and a pretext for killing American diplomats. That angry spasm begets an inflammatory Newsweek cover, “MUSLIM RAGE,” which in turn inspires a Twitter hashtag that reduces the whole episode to a running joke:

“There’s no prayer room in this nightclub. #MuslimRage.”

“You lose your nephew at the airport but you can’t yell his name because it’s JIHAD. #MuslimRage.”

From provocation to trauma to lampoon in a few short news cycles. It’s over in a week, forgotten in two. Now back to Snooki and Honey Boo Boo.

Except, of course, it’s far from over. It moves temporarily off-screen, and then it is back: the Pakistani retailer accused last week of “blasphemy” because he refused to close his shops during a protest against the video; France locking down diplomatic outposts in about 20 countries because a Paris satirical newspaper has published new caricatures of the prophet.

It’s not really over for Salman Rushdie, whose new memoir recounts a decade under a clerical death sentence for the publication of his novel “The Satanic Verses.” That fatwa, if not precisely the starting point in our modern confrontation with Islamic extremism, was a major landmark. The fatwa was dropped in 1998 and Rushdie is out of hiding, but he is still careful. His book tour for “Joseph Anton” (entitled for the pseudonym he used in his clandestine life) won’t be taking him to Islamabad or Cairo.

Rushdie grew up in a secular Muslim family, the son of an Islam scholar. His relationship to Islam was academic, then literary, before it became excruciatingly personal. His memoir is not a handbook on how America should deal with the Muslim world. But he brings to that subject a certain moral authority and the wisdom of an unusually motivated thinker. I invited him to help me draw some lessons from the stormy Arab Summer.

The first and most important thing Rushdie will tell you is, it’s not about religion. Not then, not now.

When the founding zealot of revolutionary Iran, Ayatollah Khomeini, issued his Rushdie death warrant in 1989, the imam was not defending the faith; he was trying to regenerate enthusiasm for his regime, sapped by eight years of unsuccessful war with Iraq. Likewise, Muslim clerics in London saw the fatwa against a British Indian novelist as an opportunity to arouse British Muslims, who until that point were largely unstirred by sectarian politics. “This case was a way for the mosque to assert a kind of primacy over the community,” the novelist said the other day. “I think something similar is going on now.”

It’s pretty clear that the protests against that inane video were not spontaneous. Antisecular and anti-American zealots, beginning with a Cairo TV personality whose station is financed by Saudi fundamentalists, seized on the video as a way to mobilize pressure on the start-up governments in Egypt, Tunisia and Libya. The new governments condemned the violence and called in police to protect American diplomatic outposts, but not before a good bit of nervous wobbling.

(One of the principal goals of the extremists, I was reminded by experts at Human Rights First, who follow the region vigilantly, is to pressure these transitional governments to enact and enforce strict laws against blasphemy. These laws can then be used to purge secularists and moderates.)

Like the fanatics in the Middle East and North Africa, our homegrown hatemongers have an interest in making this out to be a great clash of faiths. The Islamophobes — the fringe demagogues behind the Koran-burning parties and that tawdry video, the more numerous (mainly right-wing Republican) defenders against the imaginary encroachment of Islamic law on our domestic freedom — are easily debunked. But this is the closest thing we have to a socially acceptable form of bigotry. And their rants feed the anti-American opportunists.

Rushdie acknowledges that there are characteristics of Islamic culture that make it tinder for the inciters: an emphasis on honor and shame, and in recent decades a paranoiac sense of the world conspiring against them. We can argue who is more culpable — the hostile West, the sponsors, the appeasers, the fanatics themselves — but Islam has been particularly susceptible to the rise of identity politics, Rushdie says. “You define yourself by what offends you. You define yourself by what outrages you.”

But blaming Islamic culture dismisses the Muslim majorities who are not enraged, let alone violent, and it leads to a kind of surrender: Oh, it’s just the Muslims, nothing to be done. I detect a whiff of this cultural fatalism in Mitt Romney’s patronizing remarks about the superiority of Israeli culture and the backwardness of Palestinian culture. That would explain his assertion, on that other notorious video, that an accommodation with the Palestinians is “almost unthinkable.” That’s a strangely defeatist line of thought for a man who professes to be an optimist and a problem-solver.

Romney and Rushdie are a little more in tune when it comes to mollifying the tender feelings of irate Muslims.

In his new book, Rushdie recounts being urged by the British authorities who were protecting him to “lower the temperature” by issuing a statement that could be taken for an apology. He does so. It fills him almost immediately with regret, and the attacks on him are unabated. He “had taken the weak position and was therefore treated as a weakling,” he writes.

Of the current confrontation, he says, “I think it’s very important that we hold our ground. It’s very important to say, ‘We live like this.’ ” Rushdie made his post-fatwa life in America in part because he reveres the freedoms, including the freedom, not so protected in other Western democracies, to say hateful, racist, blasphemous things.

“Terrible ideas, reprehensible ideas, do not disappear if you ban them,” he told me. “They go underground. They acquire a kind of glamour of taboo. In the harsh light of day, they are out there and, like vampires, they die in the sunlight.”

And so he would have liked a more robust White House defense of the rights that made the noxious video possible.

“It’s not for the American government to regret what American citizens do. They should just say, ‘This is not our affair and the [violent] response is completely inappropriate.’ ”

I would cut the diplomats a little more slack when they are trying to defuse an explosive situation. But I agree that the administration pushed up against the line that separates prudence from weakness. And the White House request that Google consider taking down the anti-Muslim video, however gentle the nudge, was a mistake.

By far the bigger mistake, though, would be to write off the aftermath of the Arab Spring as a lost cause.

It is fairly astounding to hear conservatives who were once eager to invade Iraq — ostensibly to plant freedom in the region — now giving up so quickly on fledgling democracies that might actually be won over without 10 bloody years of occupation. Or lamenting our abandonment of that great stabilizing autocrat Hosni Mubarak. Or insisting that we bully and blackmail the new governments to conform to our expectations.

These transition governments present an opportunity. Fortifying the democratic elements in the post-Arab Spring nation-building, without discrediting them as American stooges, is a delicate business. The best argument we have is not our aid money, though that plays a part. It is the choice between two futures, between building or failing to build a rule of law, an infrastructure of rights, and an atmosphere of tolerance. One future looks something like Turkey, prospering, essentially secular and influential. The other future looks a lot like Pakistan, a land of fear and woe.

We can’t shape the Islamic world to our specifications. But if we throw up our hands, if we pull back, we now have a more vivid picture of what will fill the void.

    The Satanic Video, NYT, 23.9.2012,
    http://www.nytimes.com/2012/09/24/opinion/keller-the-satanic-video.html

Apple’s Feud With Google Is Now Felt on iPhone

September 23, 2012
The New York Times
By CLAIRE CAIN MILLER

SAN FRANCISCO — Once the best of friends, Google and Apple have become foes, battling in courtrooms and in the consumer marketplace. Last week, the hostilities took a new turn when they spilled right onto smartphone screens.

In the latest version of Apple’s iPhone software, which became available Wednesday, Apple removed two mainstay apps, both Google products — Maps and YouTube.

The disappearing apps show just how far-reaching the companies’ rivalry has become, as well as the importance of mobile users to their businesses.

“It’s the two big kids kicking sand in the sandbox,” said Colin Gillis, an analyst who covers Google and Apple for BGC Partners. “They’re now competing against each other with phones, with maps, with content, with search. They’re going head-to-head.”

Maps are particularly crucial on mobile devices, where location-based services and ads have emerged as the pathway to making money. Google and Apple are not the only warriors in the fight. Amazon, Nokia, Microsoft, AOL and Yahoo are competing, too.

“If you own a mobile ecology, as Google does, the other mobile ecology owners are not going to allow you to own tons of data in their world,” said Scott Rafer, chief executive of Lumatic, which makes city map apps. “And so neither Apple nor Amazon were going to let Google know where every one of their users was at every time.”

Being kicked off the iPhone has potentially significant consequences for Google, whose Maps service earns more than half its traffic from mobile devices, and almost half of that mobile traffic has been from iPhone users. Apple’s move strikes at the heart of Google’s core business, search, because about 40 percent of mobile searches are for local places or things.

“Local is a huge thing for Google in terms of advertising dollars, and search is very tied to that,” said Barry Schwartz, an editor at Search Engine Land, an industry blog. “Knowing where you are, when you search for coffee, it can bring up local coffee shops and ads that are much more relevant for the user.”

Consumers are innocent bystanders of the brawl. IPhone users now have an extra step to download the YouTube app from the App Store and, so far, Google has given no indication that it will offer a maps app. Apple’s maps, meanwhile, are littered with flaws, some laughable, like a bridge that appears to collapse crossing the Tacoma Narrows Strait of Puget Sound.

Some analysts say, however, that Apple’s maps will quickly improve, and that the long-term result of heightened competition will be better maps all around.

“Apple Maps are apparently not ready for prime time, and that’s a loss,” said Peter Krasilovsky, the program director for marketplaces at BIA/Kelsey, a local media research firm. “But a long-term loss? No. With all the incredible technology being developed by everybody, consumers are the winner.”

The war between Google and Apple escalated abruptly before breaking out on the iPhone screen. At the height of their friendship, their chief executives together unveiled the first iPhone, packed with Google services like maps, search and YouTube. But since Google introduced its own mobile operating system, Android, the companies have battled over everything mobile, from patents to ads and apps.

The brawl has played out most publicly in the courtroom, where Apple and phone manufacturers that use Google’s Android software have sued one another. Most recently, on Friday and Saturday, Apple and Samsung each filed papers to amend or overturn a jury verdict that awarded Apple $1 billion in a patent trial with Samsung. Apple wants more money and Samsung wants a new trial. The companies will return to court Dec. 6 to discuss their demands.

Though Apple’s rejection of YouTube is part of its effort to cut ties with its former friend, it is different from the battle over maps because Apple has no competing video service. Google has introduced a new YouTube app in the App Store, which has become the No. 1 free app.

But with maps, Google, which has long been the dominant digital mapmaker, now must adjust to a new rival, along with the loss of valuable iPhone users.

Even though Android phones far outnumber iPhones — 60 percent of smartphones run Android, versus 34 percent for iPhones, according to Canalys, a research firm — iPhone users account for almost half of mobile traffic to Google Maps.

In July, according to comScore Mobile Metrix, 12.6 million iPhone users visited Maps each day, versus 7.6 million on Android phones. And iPhone users spent an hour and a half using Maps during the month, while Android users spent just an hour.

Those users are a valuable source for Google, because it relies on their data to determine things like which businesses or landmarks are most important and whether maps have errors.

Google also risks losing the allegiance of app developers who build apps that tie in to maps.

“Overnight, Apple has really taken out a significant chunk of Google’s market, and it’s much harder for Google to say to developers, ‘We’re the only game in town, come play with us,’ ” said Tony Costa, a senior analyst who studies mobile phones at Forrester. “It will affect the Google ecosystem, putting it back in the same game of their apps lagging behind Apple, and that’s not a good position for them to be in.”

Still, Google is no doubt feeling a bit of satisfaction as Apple is loudly criticized for the errors in its maps.

Apple Maps users have been tallying its blunders. A Tumblr devoted to the topic included a missing lake in Hyderabad, India, misplaced restaurants in Cambridge, Mass., and the placement of Berlin in Antarctica.

Apple responded Thursday with a statement that its map service was a work in progress and would improve as more people used it.

Google, meanwhile, has been reminding people of its seven years of experience in mapping.

But the company would not say whether it was building an iPhone app for users to download. Its only public statement on the matter has been vague: “Our goal is to make Google Maps available to everyone who wants to use it, regardless of device, browser, or operating system.”

Google could decide not to build an app, as a gamble that iPhone users depend on its maps so much that they might switch to Android.

If it does build an app, Apple would have to approve it. Its guidelines for developers are ambiguous, but exclude apps that “appear confusingly similar to an existing Apple product.”

Rejecting Google’s app would most likely set off a brouhaha similar to that over the Google Voice app, which Apple rejected in 2009, prompting an investigation by the Federal Communications Commission, and a year later was approved.

More likely, analysts say, Google is waiting for the right time to swoop in and save the day by offering its own iPhone app. One benefit of making its own app: It could add features and sell ads, which it could not do on the old app because Apple controlled it. The situation with the YouTube app was the same.

In the meantime, Google is encouraging people to use maps on the iPhone’s browser, where it shows instructions to install it on their home screen.

Brian X. Chen contributed reporting from New York.

    Apple’s Feud With Google Is Now Felt on iPhone, NYT, 23.9.2012,
    http://www.nytimes.com/2012/09/24/technology/apples-feud-with-google-is-now-felt-on-the-iphone.html

Free Speech in the Age of YouTube

September 22, 2012
The New York Times
By SOMINI SENGUPTA

San Francisco

COMPANIES are usually accountable to no one but their shareholders.

Internet companies are a different breed. Because they traffic in speech — rather than, say, corn syrup or warplanes — they make decisions every day about what kind of expression is allowed where. And occasionally they come under pressure to explain how they decide, on whose laws and values they rely, and how they distinguish between toxic speech that must be taken down and that which can remain.

The storm over an incendiary anti-Islamic video posted on YouTube has stirred fresh debate on these issues. Google, which owns YouTube, restricted access to the video in Egypt and Libya, after the killing of a United States ambassador and three other Americans. Then, it pulled the plug on the video in five other countries, where the content violated local laws.

Some countries blocked YouTube altogether, though that didn’t stop the bloodshed: in Pakistan, where elections are to be scheduled soon, riots on Friday left a death toll of 19.

The company pointed to its internal edicts to explain why it rebuffed calls to take down the video altogether. It did not meet its definition of hate speech, YouTube said, and so it allowed the video to stay up on the Web. It didn’t say very much more.

That explanation revealed not only the challenges that confront companies like Google but also how opaque they can be in explaining their verdicts on what can be said on their platforms. Google, Facebook and Twitter receive hundreds of thousands of complaints about content every week.

“We are just awakening to the need for some scrutiny or oversight or public attention to the decisions of the most powerful private speech controllers,” said Tim Wu, a Columbia University law professor who briefly advised the Obama administration on consumer protection regulations online.

Google was right, Mr. Wu believes, to selectively restrict access to the crude anti-Islam video in light of the extraordinary violence that broke out. But he said the public deserved to know more about how private firms made those decisions in the first place, every day, all over the world. After all, he added, they are setting case law, just as courts do in sovereign countries.

Mr. Wu offered some unsolicited advice: Why not set up an oversight board of regional experts or serious YouTube users from around the world to make the especially tough decisions?

Google has not responded to his proposal, which he outlined in a blog post for The New Republic.

Certainly, the scale and nature of YouTube makes this a daunting task. Any analysis requires combing through over a billion videos and overlaying that against the laws and mores of different countries. It’s unclear whether expert panels would allow for unpopular minority opinion anyway. The company said in a statement on Friday that, like newspapers, it, too, made “nuanced” judgments about content: “It’s why user-generated content sites typically have clear community guidelines and remove videos or posts that break them.”

Privately, companies have been wrestling with these issues for some time.

The Global Network Initiative, a conclave of executives, academics and advocates, has issued voluntary guidelines on how to respond to government requests to filter content.

And the Anti-Defamation League has convened executives, government officials and advocates to discuss how to define hate speech and what to do about it.

Hate speech is a pliable notion, and there will be arguments about whether it covers speech that is likely to lead to violence (think Rwanda) or demeans a group (think Holocaust denial), just as there will be calls for absolute free expression.

Behind closed doors, Internet companies routinely make tough decisions on content.

Apple and Google earlier this year yanked a mobile application produced by Hezbollah. In 2010, YouTube removed links to speeches by an American-born cleric, Anwar al-Awlaki, in which he advocated terrorist violence; at the time, the company said it proscribed posts that could incite “violent acts.”

ON rare occasions, Google has taken steps to educate users about offensive content. For instance, the top results that come up when you search for the word “Jew” include a link to a virulently anti-Jewish site, followed by a promoted link from Google, boxed in pink. It links to a page that lays out Google’s rationale: the company says it does not censor search results, despite complaints.

Susan Benesch, who studies hate speech that incites violence, said it would be wise to have many more explanations like this, not least to promote debate. “They certainly don’t have to,” said Ms. Benesch, director of the Dangerous Speech Project at the World Policy Institute. “But we can encourage them to because of the enormous power they have.”

The companies point out that they obey the laws of every country in which they do business. And their employees and algorithms vet content that may violate their user guidelines, which are public.

YouTube prohibits hate speech, which it defines as that which “attacks or demeans a group” based on its race, religion and so on; Facebook’s hate speech ban likewise covers “content that attacks people” on the basis of identity. Google and Facebook prohibit hate speech; Twitter does not explicitly ban it. And anyway, legal scholars say, it is exceedingly difficult to devise a universal definition of hate speech.

Shibley Telhami, a political scientist at the University of Maryland, said he hoped the violence over the video would encourage a nuanced conversation about how to safeguard free expression with other values, like public safety. “It’s really about at what point does speech becomes action; that’s a boundary that becomes difficult to draw, and it’s a slippery slope,” Mr. Telhami said.

He cautioned that some countries, like Russia, which threatened to block YouTube altogether, would be thrilled to have any excuse to squelch speech. “Does Russia really care about this film?” Mr. Telhami asked.

International law does not protect speech that is designed to cause violence. Several people have been convicted in international courts for incitement to genocide in Rwanda.

One of the challenges of the digital age, as the YouTube case shows, is that speech articulated in one part of the world can spark mayhem in another. Can the companies that run those speech platforms predict what words and images might set off carnage elsewhere? Whoever builds that algorithm may end up saving lives.

Somini Sengupta is a technology correspondent for The New York Times.

    Free Speech in the Age of YouTube, NYT, 22.9.2012,
    http://www.nytimes.com/2012/09/23/sunday-review/free-speech-in-the-age-of-youtube.html

Video Shows Libyans Retrieving Envoy’s Body

September 16, 2012
The New York Times
By DAVID D. KIRKPATRICK

CAIRO — An amateur video that surfaced Sunday appears to show a crowd removing the motionless body of Ambassador J. Christopher Stevens from a window of the American mission in Benghazi, Libya, after it was attacked last week by Islamist militants, adding new details to reports that Mr. Stevens had died of smoke inhalation while locked in a safe room.

The video emerged as a new disagreement broke out between the recently named president of the Libyan Parliament and American officials over whether the attack was planned and whether Al Qaeda had a role.

Labeled the work of Fahd al-Bakkosh, the video centers on what appears to be the same tall, narrow window that witnesses have described as Mr. Stevens’s last exit. The witnesses said residents drawn to the scene had forced open the window and found Mr. Stevens behind a locked iron gate, pulled him out and taken him to the hospital. In the video, none say anything that shows ill will.

“I swear, he’s dead,” one Libyan says, peering in.

“Bring him out, man! Bring him out,” another says.

“The man is alive. Move out of the way,” others shout. “Just bring him out, man.”

“Move, move, he is still alive!”

“Alive, Alive! God is great,” the crowd erupts, while someone calls to bring Mr. Stevens to a car.

Mr. Stevens was taken to a hospital, where a doctor tried to revive him, but said he was all but dead on arrival.

The full identity and motivation of the attackers remains a matter of dispute. Considerable suspicion has fallen on a local Benghazi militia, Ansar al-Sharia, known for its intensely conservative and anti-democratic Islamist politics. Witnesses saw the group’s insignia on trucks at the scene, and attackers acknowledged they were members. Fighters and others present at the attack said the motive was anger at a video produced in the United States that denigrates the Prophet Muhammad.

On Sunday, Mohamed Yussef Magariaf, president of Libya’s newly elected national congress, said in interviews with American news media that he believed people affiliated with or sympathetic to Al Qaeda played a role in the assault, although he did not seem to rule out that the attackers might have been ideological allies of Al Qaeda without specific collaboration. The regional Qaeda affiliate, Al Qaeda in the Islamic Maghreb, is active near Libya but has focused primarily on attacking local governments.

Mr. Magariaf said that Libya has arrested as many as 50 people over the assault. At least a few, he said, had come from outside Libya, possibly Algeria or Mali. And he also said that he believed the non-Libyans had been involved in planning the attack in the months since they entered the country, and that it was meant to coincide with the anniversary of the Sept. 11 attacks.

Referring to “ugly deeds, criminal deeds,” Mr. Magariaf insisted that the attacks “do not resemble any way, in any sense, the aspirations, the feelings of Libyans towards the United States and its citizens,” emphasizing the role of “foreigners.”

Appearing on the same program, Susan Rice, the United States ambassador to the United Nations, said the attacks began “spontaneously in Benghazi as a reaction to what had transpired some hours earlier in Cairo.”

“But soon after that spontaneous protest began outside of our consulate in Benghazi, we believe that it looks like extremist elements, individuals, joined in that effort with heavy weapons of the sort that are, unfortunately, readily now available in Libya post-revolution,” Ms. Rice said. “And that it spun from there into something much, much more violent.”

The United States did not believe the attack was preplanned or premeditated, Ms. Rice said, adding that whether the extremists “were Al Qaeda affiliates, whether they were Libyan-based extremists or Al Qaeda itself I think is one of the things we’ll have to determine.”

Suliman Ali Zway contributed reporting from Benghazi, Libya.

    Video Shows Libyans Retrieving Envoy’s Body, NYT, 16.9.2012,
    http://www.nytimes.com/2012/09/17/world/middleeast/video-appears-to-show-libyans-retrieving-envoys-body.html

On Web, a Fine Line on Free Speech Across the Globe

September 16, 2012
The New York Times
By SOMINI SENGUPTA

SAN FRANCISCO — For Google last week, the decision was clear. An anti-Islamic video that provoked violence worldwide was not hate speech under its rules because it did not specifically incite violence against Muslims, even if it mocked their faith.

The White House was not so sure, and it asked Google to reconsider the determination, a request the company rebuffed.

Although the administration’s request was unusual, for Google, it represented the kind of delicate balancing act that Internet companies confront every day.

These companies, which include communications media like Facebook and Twitter, write their own edicts about what kind of expression is allowed, things as diverse as pointed political criticism, nudity and notions as murky as hate speech. And their employees work around the clock to check when users run afoul of their rules.

Google is not the only Internet company to grapple in recent days with questions involving the anti-Islamic video, which appeared on YouTube, which Google owns. Facebook on Friday confirmed that it had blocked links to the video in Pakistan, where it violates the country’s blasphemy law. A spokeswoman said Facebook had also removed a post that contained a threat to a United States ambassador, after receiving a report from the State Department; Facebook has declined to say in which country the ambassador worked.

“Because these speech platforms are so important, the decisions they take become jurisprudence,” said Andrew McLaughlin, who has worked for both Google and the White House. Most vexing among those decisions are ones that involve whether a form of expression is hate speech. Hate speech has no universally accepted definition, legal experts say. And countries, including democratic ones, have widely divergent legal approaches to regulating speech they consider to be offensive or inflammatory.

Europe bans neo-Nazi speech, for instance, but courts there have also banned material that offends the religious sensibilities of one group or another. Indian law frowns on speech that could threaten public order. Turkey can shut down a Web site that insults its founding president, Kemal Ataturk. Like the countries, the Internet companies have their own positions, which give them wide latitude on how to interpret expression in different countries.

Although Google says the anti-Islamic video, “Innocence of Muslims,” was not hate speech, it restricted access to the video in Libya and Egypt because of the extraordinarily delicate situation on the ground and out of respect for cultural norms.

Google has not yet explained why its cultural norms edict applied to only two countries and not others, where Muslim sensitivities have been demonstrably offended.

Free speech absolutists say all expression, no matter how despicable, should be allowed online. Others say Internet companies, like governments, should be flexible enough to exercise restraint under exceptional circumstances, especially when lives are at stake.

At any rate, as Mark L. Movsesian, a law professor at St. John’s University, pointed out, any effort to ban hateful or offensive speech worldwide would be virtually impossible, if not counterproductive.

“The regimes are so different, it’s very, very difficult to come up with one answer — unless you ban everything,” he said.

Google’s fine parsing led to a debate in the blogosphere about whether the video constituted hateful or offensive speech.

Peter J. Spiro, a law professor at Temple University, said Google was justified in restricting access to the video in certain places, if for no other reason than to stanch the violence.

“Maybe the hate speech/offensive speech distinction can be elided by the smart folks in Google’s foreign ministry,” Mr. Spiro wrote on the blog Opinio Juris. “If material is literally setting off global firestorms through its dissemination online, Google will strategically pull the plug.”

Every company, in order to do business globally, makes a point of obeying the laws of every country in which it operates. Google has already said that it took down links to the incendiary video in India and Indonesia, because it violates local statutes.

But even as a company sets its own rules, capriciously sometimes and without the due process that binds most countries, legal experts say they must be flexible to strike the right balance between democratic values and law.

“Companies are benevolent rulers trying to approximate the kinds of decisions they think would be respectful of free speech as a value and also human safety,” said Jonathan Zittrain, a law professor at Harvard.

Unlike Google, Twitter does not explicitly address hate speech, but it says in its rule book that “users are allowed to post content, including potentially inflammatory content, provided they do not violate the Twitter Terms of Service and Rules.” Those include a prohibition against “direct, specific threats of violence against others.”

That wide margin for speech sometimes lands Twitter in feuds with governments and lobbyists. Twitter was pressed this summer to take down several accounts the Indian government considered offensive. Company officials agreed to remove only those that blatantly impersonated others; impersonation violates company rules, unless the user makes it clear that it is satirical.

Facebook has some of the industry’s strictest rules. Terrorist organizations are not permitted on the social network, according to the company’s terms of service. In recent years, the company has repeatedly shut down fan pages set up by Hezbollah.

In a statement after the killings of United States Embassy employees in Libya, the company said, “Facebook’s policy prohibits content that threatens or organizes violence, or praises violent organizations.”

Facebook also explicitly prohibits what it calls “hate speech,” which it defines as attacking a person. In addition, it allows users to report content they find objectionable, which Facebook employees then vet. Facebook’s algorithms also pick up certain words that are then sent to human inspectors to review; the company declined to provide details on what kinds of words set off that kind of review.

Nudity is forbidden on Facebook, too. This year, that policy enmeshed the social network in a controversy over photographs of breast-feeding women. Facebook pages were set up by groups that objected to the company’s ban on pictures of exposed breasts, and “nurse-ins” were organized, calling on women to breast-feed outside Facebook offices worldwide.

The company said sharing breast-feeding photos was fine, but “photos that show a fully exposed breast where the child is not actively engaged in nursing do violate Facebook’s Statement of Rights and Responsibilities.”

Just this month, a New Yorker cartoon tripped over Facebook’s rules on exposed breasts. On its Facebook page, the magazine displayed a cartoon that contained the topless figures of a man and women. The illustration was removed for violating Facebook’s naked breast decree.

Facebook soon corrected itself. With “hundreds of thousands” of reported complaints each week, the company said, sometimes it makes a mistake.

    On Web, a Fine Line on Free Speech Across the Globe, NYT, 16.9.2012,
    http://www.nytimes.com/2012/09/17/technology/on-the-web-a-fine-line-on-free-speech-across-globe.html

Twitter Turns Over User’s Messages

in Occupy Wall Street Protest Case

September 14, 2012
The New York Times

Twitter on Friday turned over to a judge a printed stack of messages written by an Occupy Wall Street protester in October, around the time he and hundreds of others were arrested after walking on the roadway of the Brooklyn Bridge.

Manhattan prosecutors subpoenaed the records in January, because the messages could show that the police did not lead protesters off the bridge’s pedestrian path and then arrest them, an argument that the protester, Malcolm Harris, of Brooklyn, is expected to make at trial.

The judge, Matthew A. Sciarrino Jr., of Criminal Court in Manhattan, said he would keep the messages sealed in an envelope in his chambers until Sept. 21, when a hearing is scheduled in a challenge to his earlier ruling requiring that the messages be turned over to prosecutors.

If that challenge fails, Judge Sciarrino said he would review the messages and then turn over the relevant material to prosecutors.

Mr. Harris was one of about 700 protesters who were arrested on the bridge. He was charged with disorderly conduct, a violation.

The case has broader significance for the effect it may have on how much access law enforcement has to material published on social media Web sites. Judge Sciarrino said that once the material was broadcast, it was no longer a private record.

Twitter objected to the demand for messages that were no longer on its public site and has appealed Judge Sciarrino’s ruling.

    Twitter Turns Over User’s Messages in Occupy Wall Street Protest Case, NYT, 14.9.2012,
    http://www.nytimes.com/2012/09/15/nyregion/twitter-turns-over-messages-in-occupy-protest-case.html

As Violence Spreads in Arab World,

Google Blocks Access to Inflammatory Video

September 13, 2012
The New York Times
By CLAIRE CAIN MILLER

SAN FRANCISCO — As violence spread in the Arab world over a video on YouTube ridiculing the Prophet Muhammad, Google, the owner of YouTube, blocked access to it in two of the countries in turmoil, Egypt and Libya, but did not remove the video from its Web site.

Google said it decided to block the video in response to violence that killed four American diplomatic personnel in Libya. The company said its decision was unusual, made because of the exceptional circumstances. Its policy is to remove content only if it is hate speech, violating its terms of service, or if it is responding to valid court orders or government requests. And it said it had determined that under its own guidelines, the video was not hate speech.

Millions of people across the Muslim world, though, viewed the video as one of the most inflammatory pieces of content to circulate on the Internet. From Afghanistan to Libya, the authorities have been scrambling to contain an outpouring of popular outrage over the video and calling on the United States to take measures against its producers.

Google’s action raises fundamental questions about the control that Internet companies have over online expression. Should the companies themselves decide what standards govern what is seen on the Internet? How consistently should these policies be applied?

“Google is the world’s gatekeeper for information so if Google wants to define the First Amendment to exclude this sort of material then there’s not a lot the rest of the world can do about it,” said Peter Spiro, a constitutional and international law professor at Temple University in Philadelphia. “It makes this episode an even more significant one if Google broadens the block.”

He added, though, that “provisionally,” he thought Google made the right call. “Anything that helps calm the situation, I think is for the better.”

Under YouTube’s terms of service, hate speech is speech against individuals, not against groups. Because the video mocks Islam but not Muslim people, it has been allowed to stay on the site in most of the world, the company said Thursday.

“This video — which is widely available on the Web — is clearly within our guidelines and so will stay on YouTube,” it said. “However, given the very difficult situation in Libya and Egypt we have temporarily restricted access in both countries.”

Though the video is still visible in other Arab countries where violence has flared, YouTube is closely monitoring the situation, according to a person briefed on YouTube’s decision-making who was not authorized to speak publicly. The Afghan government has asked YouTube to remove the video, and some Google services were blocked there Thursday.

Google is walking a precarious line, said Kevin Bankston, director of the free expression project at the Center for Democracy and Technology, a nonprofit in Washington that advocates for digital civil liberties.

On the one hand, he said, blocking the video “sends the message that if you violently object to speech you disagree with, you can get it censored.” At the same time, he said, “the decision to block in those two countries specifically is kind of hard to second guess, considering the severity of the violence in those two areas.”

“It seems they’re trying to balance the concern about censorship with the threat of actual violence in Egypt and Libya,” he added. “It’s a difficult calculation to make and highlights the difficult positions that content platforms are sometimes put in.”

All Web companies that allow people to post content online — Facebook and Twitter as well as Google — have grappled with issues involving content. The questions are complicated by the fact that the Internet has no geographical boundaries, so companies must navigate a morass of laws and cultural mores. Web companies receive dozens of requests a month to remove content. Google alone received more than 1,965 requests from government agencies last year to remove at least 20,311 pieces of content, it said.

These included a request from a Canadian government office to remove a video of a Canadian citizen urinating on his passport and flushing it down the toilet, and a request from a Pakistan government office to remove six videos satirizing Pakistani officials. In both cases, Google refused to remove the videos.

But it did block access in Turkey to videos that exposed private details about public officials because, in response to Turkish government and court requests, it determined that they violated local laws.

Similarly, in India it blocked local access to some videos of protests and those that used offensive language against religious leaders because it determined that they violated local laws prohibiting speech that could incite enmity between communities.

Requests for content removal from United States governments and courts doubled over the course of last year to 279 requests to remove 6,949 items, according to Google. Members of Congress have publicly requested that YouTube take down jihadist videos they say incite terrorism, and in some cases YouTube has agreed.

Google has continually fallen back on its guidelines to remove only content that breaks laws or its terms of service, at the request of users, governments or courts, which is why blocking the anti-Islam video was exceptional.

Some wonder what precedent this might set, especially for government authorities keen to stanch expression they think will inflame their populace.

“It depends on whether this is the beginning of a trend or an extremely exceptional response to an extremely exceptional situation,” said Rebecca MacKinnon, co-founder of Global Voices, a network of bloggers worldwide, and author of “Consent of the Networked,” a book that addresses free speech in the digital age.

Somini Sengupta contributed reporting.

    As Violence Spreads in Arab World, Google Blocks Access to Inflammatory Video, NYT, 13.9.2012,
    http://www.nytimes.com/2012/09/14/technology/google-blocks-inflammatory-video-in-egypt-and-libya.html

Origins of Provocative Video Are Shrouded

September 12, 2012
The New York Times
By ADAM NAGOURNEY

LOS ANGELES — The film that set off violence across North Africa was made in obscurity somewhere in the sprawl of Southern California, and promoted by a network of right-wing Christians with a history of animosity directed toward Muslims. When a 14-minute trailer of it — all that may actually exist — was posted on YouTube in June, it was barely noticed.

But when the video, with its almost comically amateurish production values, was translated into Arabic and reposted twice on YouTube in the days before Sept. 11, and promoted by leaders of the Coptic diaspora in the United States, it drew nearly one million views and set off bloody demonstrations.

The history of the film — who financed it; how it was made; and perhaps most important, how it was translated into Arabic and posted on YouTube to Muslim viewers — was shrouded Wednesday in tales of a secret Hollywood screening; a director who may or may not exist, and used a false name if he did; and actors who appeared, thanks to computer technology, to be traipsing through Middle Eastern cities. One of its main producers, Steve Klein, a Vietnam veteran whose son was severely wounded in Iraq, is notorious across California for his involvement with anti-Muslim actions, from the courts to schoolyards to a weekly show broadcast on Christian radio in the Middle East.

Yet as much of the world was denouncing the violence that had spread across the Middle East, Mr. Klein — an insurance salesman in Hemet, Calif., a small town two hours east of here — proclaimed the video a success at portraying what he has long argued was the infamy of the Muslim world, even as he chuckled at the film’s amateur production values.

“We have reached the people that we want to reach,” he said in an interview. “And I’m sure that out of the emotion that comes out of this, a small fraction of those people will come to understand just how violent Muhammad was, and also for the people who didn’t know that much about Islam. If you merely say anything that’s derogatory about Islam, then they immediately go to violence, which I’ve experienced.”

Mr. Klein has a long history of making controversial and erroneous claims about Islam. He said the film had been shown at a screening at a theater “100 yards or so” from Grauman’s Chinese Theater in Hollywood over the summer, drawing what he suggested was a depressingly small audience. He declined to specify what theater might have shown it, and theater owners in the vicinity of the busy strip said they had no record of any such showing.

The amateurish video opens with scenes of Egyptian security forces standing idle as Muslims pillage and burn the homes of Coptic Christians. Then it cuts to cartoonish scenes depicting the Prophet Muhammad as a child of uncertain parentage, a buffoon, a womanizer, a homosexual, a child molester and a greedy, bloodthirsty thug.

Even as Mr. Klein described his role in the film as incidental, James Horn, a friend who has worked with Mr. Klein in anti-Muslim activities for several years, said he believed Mr. Klein was involved in providing technical assistance to the film and advice on the script. Mr. Horn said he called Mr. Klein on Wednesday. “I said, ‘Steve, did you do this?’ He said, ‘Yep.’ ”

As the movie, “Innocence of Muslims,” drew attention across the globe, it was unclear whether a full version exists. Executives at Hollywood agencies said they had never heard of it. Hollywood unions said they had no involvement. Casting directors said they did not recognize the actors in the 14-minute YouTube clip that purports to be a trailer for a longer film. Production offices had no records for a movie of that name. There was a 2009 casting call in BackStage, however, for a film called “Desert Warrior” whose producer is listed as Sam Bassiel.

That name is quite similar to the one that Mr. Klein, in the interview, said was the director of his film. He spelled it Sam Basile, though he added that was not the director’s real name. Mr. Klein said he met Mr. Basile while scouting mosques in Southern California, “locating who I thought were terrorists.”

An actress who played the role of a mother in the film said in an interview that the director had originally told cast members that the film was “Desert Warriors” and would depict ancient life. Now, she said, she feels duped, angry and sad. “When I looked at the trailer, it was nothing like what we had done. There was not even a character named Muhammad in what we originally put together,” said the actress, who asked that her name not be used for fear of her safety.

She said she had spoken on Wednesday to the film’s director, whose last name she said was spelled Basil. She said he told her that he made the film because he was upset with Muslims killing innocent people.

The original idea for the film, Mr. Klein said, was to lure hard-core Muslims into a screening of the film thinking they were seeing a movie celebrating Islam. “And when they came in they would see this movie and see the truth, the facts, the evidence and the proof,” he said. “So I said, yeah, that’s a good idea.”

Among the film’s promoters was Terry Jones, the Gainesville, Fla., preacher whose burning of the Koran led to widespread protests in Afghanistan. Mr. Jones said Wednesday that he has not seen the full video.

Gen. Martin E. Dempsey, the chairman of the Joint Chiefs of Staff, called Mr. Jones on Wednesday and asked him to consider withdrawing his support for the video. Mr. Jones described the conversation as “cordial,” but said he had not decided what he would do because he had yet to see the full film.

The Southern Poverty Law Center said Mr. Klein taught combat training to members of California’s Church at Kaweah, which the center described as a “a combustible mix of guns, extreme antigovernment politics and religious extremism” and an institution that had an “obsession with Muslims.”

Warren Campbell, the pastor of the church, said that Mr. Klein had come to the congregation twice to talk about Islam. He said the law center’s report on his church was filled “with distortions and lies.” The center also said that Mr. Klein was the founder of Courageous Christians United, which conducts demonstrations outside abortion clinics, Mormon temples and mosques. Mr. Klein also has ties to the Minuteman movement.

Mr. Horn said Mr. Klein was motivated by the near-death of his son, who Mr. Horn said had served in the United States Army in Iraq and was wounded in Falluja. “That cemented Steve’s feelings about it,” he said.

Although Mr. Horn described Mr. Klein as connected to the Coptic community in Los Angeles — and Morris Sadek, the leader of a Washington-based Coptic organization, had promoted the film on the Web — Bishop Serapion of the Coptic Orthodox Diocese of Los Angeles said he did not know of Mr. Klein. “We condemn this film,” he said. “Our Christian teaching is we have to respect people of other faiths.”

Reporting was contributed by Brooks Barnes, Michael Cieply

and Ian Lovett from Los Angeles; Jason Henry from Gainesville, Fla.;

Lizette Alvarez from Miami; Serge F. Kovaleski and Andrea Elliott from New York;

and Elisabeth Bumiller from Washington.

Kitty Bennett and Jack Styczynski contributed research from New York.

This article has been revised to reflect the following correction:

Correction: September 12, 2012

An earlier version of this article mispelled the name of a bishop

of the Coptic Orthodox Diocese of Los Angeles. It is Serapion, not Serapian.

    Origins of Provocative Video Are Shrouded, NYT, 12.9.2012,
    http://www.nytimes.com/2012/09/13/world/middleeast/origins-of-provocative-video-shrouded.html

A New Kind of Warfare

September 9, 2012
The New York Times

Cybersecurity efforts in the United States have largely centered on defending computer networks against attacks by hackers, criminals and foreign governments, mainly China. Increasingly, however, the focus is on developing offensive capabilities, on figuring out how and when the United States might unleash its own malware to disrupt an adversary’s networks. That is potentially dangerous territory.

Such malware is believed to have little deterrent value against criminals who use computers to steal money from banks or spies who pilfer industrial secrets. But faced with rising intrusions against computers that run America’s military systems and its essential infrastructure — its power grid, for instance, and its telecommunications networks — the military here (and elsewhere) sees disruptive software as an essential new tool of war. According to a study by the Center for Strategic and International Studies, the 15 countries with the biggest military budgets are all investing in offensive cyber capabilities.

The latest step occurred last month when the United States sent out bids for technologies “to destroy, deny, degrade, disrupt, corrupt or usurp” an adversary’s attempt to use cyberspace for advantage. The Air Force asked for proposals to plan for and manage cyberwarfare, including the ability to launch superfast computer attacks and withstand retaliation.

The United States, China, Russia, Britain and Israel began developing basic cyberattack capabilities at least a decade ago and are still figuring out how to integrate them into their military operations. Experts say cyberweapons will be used before or during conflicts involving conventional weapons to infect an adversary’s network and disrupt a target, including shutting down military communications. The most prominent example is the Stuxnet virus deployed in 2010 by the United States and Israel to set back Iran’s nuclear program. Other cyberattacks occurred in 2007 against Syria and 1998 against Serbia.

Crucial questions remain unanswered, including what laws of war would apply to decisions to launch an attack. The United States still hasn’t figured out what impact cyberweapons could have on actual battlefield operations or when an aggressive cyber response is required. Nor has Washington settled on who would authorize an attack; experts see roles for both the president and military commanders. There is also the unresolved issue of how to minimize collateral damage — like making sure malware does not cripple a civilian hospital.

Another big concern is China, which is blamed for stealing American military secrets. Washington has not had much success persuading Beijing to rein in its hackers. There is a serious risk of miscalculation if, for example, there is a confrontation in the South China Sea. China could misinterpret a move, unleash a cyberattack and trigger a real cyberwar. What’s clearly needed are new international understandings about what constitutes cyber aggression and how governments should respond. Meanwhile, the United States must do what it can to protect its own networks.

    A New Kind of Warfare, NYT, 9.9.2012,
    http://www.nytimes.com/2012/09/10/opinion/a-new-kind-of-warfare.html

Hackers Claim to Have 12 Million Apple Device Records

September 4, 2012
12:53 pm
The New York Times
By NICOLE PERLROTH

8:00 p.m. | Updated Hackers released a file that they said contained a million identification numbers for Apple mobile devices, claiming that they had obtained it by hacking into the computer of an F.B.I. agent. The F.B.I. said it had no evidence that this was true.

The hacking group, known as AntiSec - a subset of the loose hacking collective known as Anonymous - posted copies of the file on Sunday and claimed to have a total of 12 million numbers for iPhone, iPad and iPod Touch devices, along with some phone numbers and other personal data on their owners. They said their goal in releasing a slice of the data was to prove that the F.B.I. used device information to track people.

While the leaked identification numbers appeared to be real, security experts said the release posed little risk. They said that without more information on the devices' owners - like e-mail addresses or date of birth - it would be hard for someone to use the numbers to do harm.

And the actual source of the file was not clear. The F.B.I. said in a statement that "at this time there is no evidence indicating that an F.B.I. laptop was compromised or that the F.B.I. either sought or obtained this data."

The F.B.I. has been a frequent target of so-called hacktivists, hackers who attack for political causes rather than for profit. In February, Anonymous hackers intercepted a call between the bureau and Scotland Yard. But the frequency of such attacks tapered off after several members of Anonymous and a spinoff group, LulzSec, were arrested in March.

Apple's unique device identifiers - known as U.D.I.D.'s - are 40-character strings of letters and numbers assigned to Apple devices. Last year, Aldo Cortesi, a New Zealand security researcher, demonstrated how in some cases U.D.I.D.'s could be used in combination with other data to connect devices to their owners' online user names, e-mail addresses, locations and even Facebook profiles.

"A U.D.I.D. is just a jumble of digits," said Jim Fenton, the chief security officer of OneID. "It is only powerful when it is aggregated with other information."

Security experts said the identification numbers appeared legitimate, and one number in the file matched that of a New York Times employee's iPad. "The structure and format of the data indicates this is a real breach," said Rob Rachwald, director of security at Imperva, a computer security firm. An Apple spokesman did not respond to requests for comment.

The hackers released only U.D.I.D.'s, a separate Apple-specific identifier and the device names that owners give their devices, like "Lori's iPad." Only a few identifiers were tied to e-mail addresses, apparently because the device's owner chose to use an e-mail address when naming it.

Apple stopped letting app developers take advantage of device identifiers last year, to make it harder for marketers to track its customers as they moved from app to app.

The hackers claimed to have obtained the file from the computer of Christopher K. Stangl, a supervisory agent of the F.B.I.'s Cyber Action Team. In 2009, Mr. Stangl appeared in a Facebook promotional video titled "Wanted by the FBI: Cyber Security Experts" that encouraged hackers to get involved with the F.B.I.

He was also one of 44 law enforcement agents invited to participate in the F.B.I.-Scotland Yard conference call that hackers intercepted.

But security experts said the file could have come from a number of places.

"There are a million ways this could have happened," said Marcus Carey, a researcher at Rapid7. "Apple could have been breached. AT&T could have been breached. A video game maker could have been breached. The F.B.I. could have obtained the file while doing forensics on another data breach."

In their statement, the hackers said they would not grant any interviews about the breach until a reporter for Gawker, Adrian Chen, posed for his employer's site, for a full day, in a ballet tutu with a shoe on his head.

On Tuesday evening, Mr. Chen complied. "There's me in a tutu," he wrote in a blog post with accompanying photos. "Get used to it because it's going to be up until around 6:30 p.m. tomorrow."

    Hackers Claim to Have 12 Million Apple Device Records, NYT, 4.9.2012,
    http://bits.blogs.nytimes.com/2012/09/04/hackers-claim-to-have-12-million-apple-device-records/

Internet Pirates Will Always Win

August 4, 2012
The New York Times
By NICK BILTON

STOPPING online piracy is like playing the world’s largest game of Whac-A-Mole.

Hit one, countless others appear. Quickly. And the mallet is heavy and slow.

Take as an example YouTube, where the Recording Industry Association of America almost rules with an iron fist, but doesn’t, because of deceptions like the one involving a cat.

YouTube, which is owned by Google, offers a free tool to the movie studios and television networks called Content ID. When a studio legitimately uploads a clip from a copyrighted film to YouTube, the Google tool automatically finds and blocks copies of the product.

To get around this roadblock, some YouTube users started placing copyrighted videos inside a still photo of a cat that appears to be watching an old JVC television set. The Content ID algorithm has a difficult time seeing that the video is violating any copyright rules; it just sees a cat watching TV.

Sure, it’s annoying for those who want to watch the video, but it works. (Obviously, it’s more than annoying for the company whose product is being pirated.)

Then there are those — possibly tens of millions of users, actually — who engage in peer-to-peer file-sharing on the sites using the BitTorrent protocol.

Earlier this year, after months of legal wrangling, authorities in a number of countries won an injunction against the Pirate Bay, probably the largest and most famous BitTorrent piracy site on the Web. The order blocked people from entering the site.

In retaliation, the Pirate Bay wrapped up the code that runs its entire Web site, and offered it as a free downloadable file for anyone to copy and install on their own servers. People began setting up hundreds of new versions of the site, and the piracy continues unabated.

Thus, whacking one big mole created hundreds of smaller ones.

Although the recording industries might believe they’re winning the fight, the Pirate Bay and others are continually one step ahead. In March, a Pirate Bay collaborator, who goes by the online name Mr. Spock, announced in a blog post that the team hoped to build drones that would float in the air and allow people to download movies and music through wireless radio transmitters.

“This way our machines will have to be shut down with aeroplanes in order to shut down the system,” Mr. Spock posted on the site. “A real act of war.” Some BitTorrent sites have also discussed storing servers in secure bank vaults. Message boards on the Web devoted to piracy have in the past raised the idea that the Pirate Bay has Web servers stored underwater.

“Piracy won’t go away,” said Ernesto Van Der Sar, editor of Torrent Freak, a site that reports on copyright and piracy news. “They’ve tried for years and they’ll keep on trying, but it won’t go away.” Mr. Van Der Sar said companies should stop trying to fight piracy and start experimenting with new ways to distribute content that is inevitably going to be pirated anyway.

According to Torrent Freak, the top pirated TV shows are downloaded several million times a week. Unauthorized movies, music, e-books, software, pornography, comics, photos and video games are watched, read and listened to via these piracy sites millions of times a day.

The copyright holders believe new laws will stop this type of piracy. But many others believe any laws will just push people to find creative new ways of getting the content they want.

“There’s a clearly established relationship between the legal availability of material online and copyright infringement; it’s an inverse relationship,” said Holmes Wilson, co-director of Fight for the Future, a nonprofit technology organization that is trying to stop new piracy laws from disrupting the Internet. “The most downloaded television shows on the Pirate Bay are the ones that are not legally available online.”

The hit HBO show “Game of Thrones” is a quintessential example of this. The show is sometimes downloaded illegally more times each week than it is watched on cable television. But even if HBO put the shows online, the price it could charge would still pale in comparison to the money it makes through cable operators. Mr. Wilson believes that the big media companies don’t really want to solve the piracy problem.

“If every TV show was offered at a fair price to everyone in the world, there would definitely be much less copyright infringement,” he said. “But because of the monopoly power of the cable companies and content creators, they might actually make less money.”

The way people download unauthorized content is changing. In the early days of music piracy, people transferred songs to their home or work computers. Now, with cloud-based sites, like Wuala, uTorrent and Tribler, people stream movies and music from third-party storage facilities, often to mobile devices and TV’s. Some of these cloud-based Web sites allow people to set up automatic downloads of new shows the moment they are uploaded to piracy sites. It’s like piracy-on-demand. And it will be much harder to trace and to stop.

It is only going to get worse. Piracy has started to move beyond the Internet and media and into the physical world. People on the fringes of tech, often early adopters of new devices and gadgets, are now working with 3-D printers that can churn out actual physical objects. Say you need a wall hook or want to replace a bit of hardware that fell off your luggage. You can download a file and “print” these objects with printers that spray layers of plastic, metal or ceramics into shapes.

And people are beginning to share files that contain the schematics for physical objects on these BitTorrent sites. Although 3-D printing is still in its infancy, it is soon expected to become as pervasive as illegal music downloading was in the late 1990s.

Content owners will find themselves stuck behind ancient legal walls when trying to stop people from downloading objects online as copyright laws do not apply to standard physical objects deemed “noncreative.”

In the arcade version of Whac-A-Mole, the game eventually ends — often when the player loses. In the piracy arms-race version, there doesn’t seem to be a conclusion. Sooner or later, the people who still believe they can hit the moles with their slow mallets might realize that their time would be better spent playing an entirely different game.

Nick Bilton is a technology columnist for The New York Times.

    Internet Pirates Will Always Win, NYT, 4.8.2012,
    http://www.nytimes.com/2012/08/05/sunday-review/internet-pirates-will-always-win.html

A Law to Strengthen Our Cyberdefense

August 1, 2012
The New York Times
By ASHTON B. CARTER and JANE HOLL LUTE

Washington

OVER the last decade, the United States has built a sophisticated security system to protect the nation’s seaports against terrorists and criminals. But our nation’s critical infrastructure is not similarly secured from cyberattack. Although we have made progress in recent years, Congressional action is needed to ensure that our laws keep pace with the electronically connected world we live in. The bipartisan Cybersecurity Act of 2012, currently before the Senate, offers a way forward.

A disruption of our electric grid or other critical infrastructure could temporarily cripple the American economy. What’s less well known is that such an attack could threaten the nation’s defense as well.

Ninety-nine percent of the electricity the military uses comes from civilian sources. Ninety percent of military voice and Internet communications travel over commercial networks. Much of the country’s military logistics are handled by commercial shippers who rely, in turn, on privately managed networks.

As we protect our ports and coastlines, so must we marshal resources and techniques to mount an adequate defense of our networks. Our port security is ensured by a combination of the Coast Guard, Customs and Border Protection, state and local governments, and private shipping companies and port operators, with the support of the Navy and the intelligence agencies. Together, they patrol American waters, scan cargo, analyze and share information about threats to our coastlines, and report suspicious behavior to the proper authorities. If any of these layers were to be removed, our defenses would be weakened.

Effective cybersecurity requires a similar multilevel approach. We have a final line of cyberdefense in the Defense Department’s Cyber Command, which defends the nation against advanced cyberattacks, and we have a strong cyberintelligence system in the National Security Agency, which detects cyberthreats from overseas. But we need additional levels of defense to protect the nation’s critical infrastructure.

Collective problems require collaborative solutions. The government and private sector must work together to prevent cyberdisruption, cyberdestruction and theft of intellectual property. This requires robust sharing of information between the government and private sector, aggressive prosecution of cybercriminals, and cooperation among federal agencies.

Simply put, the Cybersecurity Act would help by enabling the government to share information about cyberthreats with industry. The legislation would also permit the private sector to report cyberintrusions to the government or private companies. That ability would increase awareness of cyberthreats, while leaving the private sector in control of which information is shared. It would do all of this while protecting privacy and civil liberties, through robust oversight and accountability measures.

None of us want to see heavy government regulation, especially of the Internet, the fount of so much innovation and economic productivity. The legislation would provide meaningful baseline cybersecurity standards for industry, developed and adopted through a joint industry-government process.

Although the American economy needs effective cybersecurity measures to function and prosper, many providers of critical infrastructure have not invested in basic strategies to defend themselves against cyberthreats. Meaningful standards will help drive companies to invest and help fill the gaps in our nation’s cyberdefenses.

Finally, the Cybersecurity Act would ensure that the Department of Homeland Security has the ability to protect federal networks and assist the private sector effectively and efficiently, by strengthening the department’s legal authority.

The Department of Defense stands ready to support the Department of Homeland Security and any other agency in protecting the nation’s critical infrastructure. Together, our two departments can bring our technical ability to bear and improve the nation’s stock of cybersecurity tools and technology.

This legislation is a critical step for defending America’s infrastructure against the clear and present cyberthreats we face. We’re not going to solve this problem overnight; it will involve a learning experience for both the private sector and the government, but we must learn fast, and develop solutions as quickly as possible. The legislation will help pave the way to American security and prosperity in the information age. It deserves the full support of Congress and the American people.

Ashton B. Carter is the deputy secretary of defense

and Jane Holl Lute is the deputy secretary of homeland security.

    A Law to Strengthen Our Cyberdefense, NYT, 1.8.2012,
    http://www.nytimes.com/2012/08/02/opinion/a-law-to-strengthen-our-cyberdefense.html

Cybersecurity at Risk

July 31, 2012
The New York Times


Relentless assaults on America’s computer networks by China and other foreign governments, hackers and criminals have created an urgent need for safeguards to protect these vital systems. The question now is whether the Senate will provide them. Senator John McCain, a Republican of Arizona, and the Chamber of Commerce have already exacted compromises from sponsors of a reasonably strong bill, and are asking for more. Their demands should be resisted and the original bill approved by the Senate.

Officials and experts have warned about cybersecurity dangers for years; now the alarms are more insistent. On Thursday, Gen. Keith Alexander, the chief of the United States Cyber Command and the director of the National Security Agency, said intrusions against computers that run essential infrastructure increased 17-fold from 2009-11 and that it’s only a matter of time before an attack causes physical damage. He has also called the loss of industrial information and intellectual property through cyberespionage “the greatest transfer of wealth in history.”

American officials say businesses already lose billions of dollars annually. Hundreds of major companies, defense contractors and government agencies have been affected. Attacks on power plants, electric grids, refineries, transportation networks and water treatment systems present an even greater threat. Last year, there were at least 200 attempted or successful cyberattacks on those facilities.

Yet defenses are dangerously thin. On a scale of 1 to 10, General Alexander rated preparedness for a large-scale cyberattack — shutting down the stock exchange, for instance — as “around a 3.” That is why President Obama and others have argued for mandatory minimum standards that would require companies to share information and harden computer protections.

Bipartisan legislation drafted by Senator Joseph Lieberman, a Connecticut independent and the chairman of the homeland security committee, and Senator Susan Collins of Maine, the ranking Republican member, met that bar. But faced with strong opposition from Mr. McCain and the business community, the sponsors compromised. Under the revised bill, industry will develop the standards for addressing threats and compliance will be voluntary.

This has not satisfied Mr. McCain or the chamber, which insists the bill would still be too costly and cumbersome. Last year, a survey of more than 9,000 executives in more than 130 countries by the PricewaterhouseCoopers consulting firm found that only 13 percent of those polled had taken adequate defensive action against cyberthreats.

Not all companies share that aversion to the bill. Microsoft and Symantec, among others, have supported the original Lieberman-Collins legislation. And civil liberties groups say their earlier privacy concerns have been addressed. It’s time for the endless talk of cyberthreats to be met by action. The Lieberman-Collins bill should be voted by the Senate this week and then merged with the House version so a law can be enacted this year. If not, and a catastrophic cyberattack occurs, Americans will be justified in asking why their lawmakers, mired in election-year partisanship, failed to protect them.

    Cybersecurity at Risk, NYT, 31.7.2012,
    http://www.nytimes.com/2012/08/01/opinion/cybersecurity-at-risk.html

Some PayPal Users Criticize Antifraud Measures

August 1, 2012
The New York Times
By BRIAN X. CHEN

Jorge Espinoza, the founder of PreRace, a Web site where bicyclists and runners can register for races, was on a roll in March. In three days his site took in over $1 million in registrations for a major bike race, much more than usual.

Then PayPal, the online payment service that his site was using to process credit card transactions, froze the company’s account. To PayPal, the flurry of activity raised suspicions about fraud, so it told Mr. Espinoza that it was holding the money.

“They created such a massive headache,” Mr. Espinoza said. If he had not been able to take out a $500,000 loan to pay the race’s organizers, he said, PayPal could easily have put PreRace out of business. While PayPal says that only a small percentage of its customers run into such issues, there have been enough horror stories like this in recent years to make some companies think twice about using PayPal, the most popular electronic payments service in the world.

The victims range from individual sellers to start-up companies, and from creative artists to impromptu philanthropists. They all had to scramble when PayPal decided to hold onto their money longer than expected.

PayPal, which is owned by eBay, remains the dominant global player in e-commerce, handling more than half of all Web transactions by some estimates, and it continues to grow. But some businesses who are frustrated by the company’s aggressive antifraud measures are looking at other ways to accept payments.

When it was founded in 1998, PayPal was among the first companies that allowed people to easily transmit funds to one another over the Internet. It now has 113 million users worldwide, and it says its antifraud measures are in place to protect those users from what is no doubt an army of would-be swindlers.

Katherine Hutchison, senior director of risk management at PayPal, said it has employed hundreds of mathematics scholars with Ph.D.’s who work on software to detect and prevent fraud. One potential sign of fraud, she said, is an unusually large transaction.

For example, if a merchant regularly sells items that cost $30 to $50, and then suddenly sells a $3,000 item, PayPal cannot be completely sure that the seller actually has such a valuable item in her inventory, so it proceeds cautiously to protect the buyer. “When you walk into a dollar store or a drugstore, you’re not going to buy fine jewelry there,” she said.

Another warning sign is a spike in activity, like a sudden burst of transactions in a formerly quiet account. PayPal says it has seen cases where this is a sign that a person is about to go bankrupt and is selling off all of his possessions — possibly before fleeing the country.

April Winchell, an actress and the publisher of the humor blog Regretsy, had nothing of the sort in mind last December when she decided to use her blog and PayPal to drum up donations to buy Christmas gifts for poor children. The money came in so fast — $20,000 in total — that PayPal froze her account. She ended up dipping into her own savings to buy the gifts, and only after Ms. Winchell documented the incident on her blog did PayPal apologize. It ended up reimbursing her for the donations.

Ms. Winchell is still upset with PayPal. She said she was still getting e-mails from people who ran across her blog posts and told her of similar problems with the service, including one in which PayPal suspended the account of a charity collecting donations for orphans in Vietnam. Other tales of woe are scattered across message boards on PayPal’s own site and elsewhere.

“It happens every day,” Ms. Winchell said. “It’s the most bizarre and draconian policy, and it’s really embarrassing, but they’re huge and they just don’t care.”

PayPal’s Ms. Hutchison said situations where people had to wait to access their funds were rare, affecting about 2 percent of accounts. Very few of those were extreme cases, as when an account is frozen, she said.

Ms. Hutchison added that the company was working to be more open with merchants and customers about its policies. After a reporter began asking about customer problems, she published a blog post clarifying and discussing changes to PayPal’s policies on holding funds.

Some companies are competing with PayPal by looking specifically at the headaches it sometimes causes for businesses and aiming to offer a more customer-friendly service. Bill Clerico, chief executive of WePay, an electronic payments service based in Palo Alto, Calif., said he had decided to form his company because of his own experience in 2007, during his college years, when PayPal held thousands of dollars he had collected for his work as a tutor.

“As a college kid trying to pay rent and have spending money, it was incredibly frustrating to have that kind of money tied up,” Mr. Clerico said.

WePay uses many of the same fraud-detection methods as PayPal, he said, but the main difference is that its system takes into account a business’s social networking profiles when investigating suspicious transactions. A small company’s Facebook pages, Yelp reviews and Twitter account are evaluated to gauge its legitimacy, and a business’s account is frozen only when it has been conclusively determined that fraud has taken place, he said.

Mr. Clerico noted that PayPal had started as a service for people to sell items over eBay, not as something to build a business on. He developed WePay with small businesses in mind. Max Levchin, the co-founder of PayPal, is an investor in WePay. Other PayPal competitors include Braintree and payment services from Amazon and Google.

But PayPal is not going anywhere. Samee Zafar, a director at Edgar, Dunn and Company — a consulting firm that has done some work for PayPal in the past — said that even if competitors found a way to make payments simpler, none of them have the global reach of PayPal.

“Feature by feature, I’m sure these companies are better in some ways with their payment technologies than PayPal, but that doesn’t mean you can beat the guy who has the real customer network,” Mr. Zafar said. He added that unlike its smaller rivals, PayPal has relationships with banks all around the world, and the brand has gained trust and recognition. (WePay requires businesses it works with to be in the United States.)

Mr. Zafar said PayPal’s challenge would be in mobile payments, a market that is full of hot start-ups like Square and Scvngr. PayPal does not have the infrastructure or a presence in physical retail stores yet, apart from a pilot project with Home Depot, and it will be difficult for a company that has always done online payments to make this transition, he said.

In PreRace’s case, Mr. Espinoza said that before the freeze he called a customer service hot line to warn PayPal that PreRace was about to get a big influx of money. He said he spoke to a low-level representative who made a note of the call — but this did not matter to the risk analysis team that froze the account.

PayPal said it would allow the company to withdraw part of its money once a month, and would release the balance only after the bike race concluded in mid-June. PreRace eventually got all of its money. But Mr. Espinoza is in the process of switching to a different payment service.

    Some PayPal Users Criticize Antifraud Measures, NYT, 1.8.2012,
    http://www.nytimes.com/2012/08/02/technology/paypal-antifraud-measures-are-extreme-some-users-say.html

Behind eBay’s Comeback

July 27, 2012
The New York Times
By JAMES B. STEWART

Remember Myspace, Friendster, eToys, Webvan, Urban Fetch, Pets.com? Like meteors, they burned with dazzling brilliance before turning shareholder dollars to ash. EBay, Yahoo and AOL, the dominant Internet triumvirate circa 2004, seemed destined for a similar fate. The conventional wisdom has been that once decline sets in at an Internet company, it’s irreversible.

But that was before eBay’s latest earnings surprise, which sent its stock soaring and had analysts scrambling to raise their projections. “Can Internet companies ever turn around? The answer has been no,” Ken Sena, Internet analyst at Evercore, told me this week. “But now, there’s eBay. The answer may turn out to be yes.”

If so, eBay’s success has big implications for struggling companies like Yahoo and AOL, not to mention more recent sensations that have already lost some luster, like Zynga, Groupon and even Facebook, whose shares tumbled this week after its first earnings report as a public company disappointed investors. “EBay has demonstrated that it’s possible to turn the corner even against long odds,” said David Spitz, president and chief operating officer of ChannelAdvisor, an e-commerce consulting company.

EBay shares hit a peak of over $58 in 2004 and made its chief executive, Meg Whitman, a Silicon Valley celebrity. But by November 2007, when she stepped down to enter politics, the telltale signs of decline had set in. Its stock was slumping. Its dominant online auction business had matured, and growth had slowed. Sellers complained about higher fees and poor support. That year, eBay wrote off $1.4 billion on its poorly conceived $2.5 billion acquisition of the calling service Skype, recording its first loss as a public company. Analysts worried that eBay had lost its quirky soul, and was abandoning the flea market auction model that had made it distinctive and dominant in online auctions. By early 2009, its stock was barely over $10, down over 80 percent from its peak.

Ms. Whitman was succeeded by a former Bain & Company managing director, John Donahoe. “One of the unique things about the Internet is a company can be a white-hot success and become a global brand and reach global scale in just a few years — that’s the good news,” he told me this week. “But then somebody can turn around and do it to you. There’s constant disruption. One of the first things I had to do here was face reality. EBay was getting disrupted.”

Little more than four years after taking charge, a buoyant Mr. Donahoe sounded like the chief executive of a surging start-up when he announced eBay’s latest results on July 18. So thoroughly has eBay been transformed that he didn’t even mention its traditional auction business. “Our multiyear effort is paying off,” he said. Profit more than doubled and revenue jumped 23 percent. “EBay is revitalized. We believe the best is yet to come.” In a stock market struggling with recession fears and the European debt crisis, eBay stock this week hit a six-year high.

How has eBay done it when so many others have failed?

Excitement about eBay’s prospects has little to do with its traditional auction business, or even its core e-commerce operations, although its marketplace division posted solid results and had its best quarter since 2006, the company said. Most of its growth came from mobile retailing and its PayPal online payments division, a business it acquired in 2002 for what now looks like a bargain $1.5 billion.

As consumers embrace shopping on their smartphones, “mobile continues to be a game-changer,” Mr. Donahoe said. He noted that 90 million users had downloaded eBay’s mobile app and that 600,000 customers made their first mobile purchase during the most recent quarter. “A woman’s handbag is purchased on eBay mobile every 30 seconds,” he said. “Mobile is revolutionizing how people shop and pay.”

“It’s hard to think of many companies that benefit from mobile,” Mr. Sena said. “Usually it means more competition. But clearly, eBay is one of them. EBay is offering a one-click payment solution. You don’t have to type in a credit card number or PIN. It’s just one click on your mobile phone.”

Mr. Spitz said he was recently stopped at a traffic light and the sun was bothering his eyes. By the time the light turned green, he had used his phone to order and pay for sunglasses. “This is what commerce anytime, anywhere means,” he said. “It’s here.”

Mr. Donahoe deserves credit not only for recognizing that smartphones would change the shopping experience, but for acting on it, Mr. Spitz said. “EBay under Mr. Donahoe pivoted hard in this direction,” he said.

Mr. Donahoe confirms that, saying: “We saw the mobile revolution early and we made a big bet across the entire company. We saw that mobile was an important factor for our customers. It was becoming the central control device in their lives. We didn’t worry if it cannibalized our existing business, because we knew it was what our customers wanted.”

The smartphone “has blurred the line between e-commerce and off-line retail,” Mr. Donahoe continued. “Four years ago, you had to be in front of a laptop or desktop to shop online. Now you can do it seven days, 24 hours. We’re going to have to drop the ‘e’ from e-commerce.”

Retailers have warmed to the new eBay. “They’re a great partner,” Gerald L. Storch, chairman and chief executive of Toys “R” Us, told me this week. “In an omni-channel retail world, mobile, social, Internet, physical stores — they’re all linked. Customers want to interact with our brand at every level. EBay is especially strong in mobile and payment systems, but they address all those areas and help us compete. We do everything with them.”

Amazon was supposed to have crushed eBay by now with its bigger scale and state-of-the-art inventory and delivery systems. That didn’t happen, but Amazon remains eBay’s biggest competitive threat. Amazon continues to invest in its delivery systems and it, too, has an effective mobile app and one-click payment system.

Even so, many analysts see plenty of room for both Amazon and eBay, and perhaps even more competitors. “When you look at e-commerce as a share of overall consumer spending, it’s not even 10 percent worldwide,” Mr. Spitz said. “There’s plenty of room for growth.”

Mr. Donahoe agreed. “We’ve never viewed the world as a zero-sum game with Amazon,” he said. “There’s plenty of room for multiple winners.”

Moreover, eBay is likely to benefit from its global reach and scale as e-commerce expands. “Consumers aren’t going to download 30 apps from individual retailers, but they will download both eBay and Amazon,” Mr. Spitz said. EBay and PayPal apps already rank among the top 10 mobile apps, eBay said.

And it’s obviously in retailers’ interests to prevent Amazon from becoming an e-commerce monopoly. EBay stresses, without mentioning Amazon by name, that it doesn’t compete with its retail customers. Some sellers have complained that when Amazon spots a hot product, it starts promoting and selling it itself at lower prices.

As Mr. Storch put it: “We do sell Kindle Fires and other Amazon products, but when it comes to retail, eBay helps us succeed. Amazon is the competition.”

The dynamics of e-commerce aside, several broad themes emerge from eBay’s turnaround:

¶ EBay had to break with its past and seize new opportunities. “It was clear the world had innovated around eBay and eBay had stayed with the same formula,” Mr. Donahoe said. “Saying that was considered heresy. With any company that’s been this successful, there’s enormous momentum to keep doing what you’ve been doing and hope the world will go back to what it used to be.”

At the same time, EBay didn’t entirely abandon its roots — it’s still an e-commerce company. But “we had to make changes that were unpopular with subsets of our customers and other people. You have to have the conviction to do what you know is right,” Mr. Donahoe said. “We spent three years fixing the fundamentals and tried not to worry about what everyone else was saying.”

¶ Technological innovation is critical. “We stepped on the gas with innovation,” Mr. Donahoe said. “We’re more technology- and innovation-driven than we’ve ever been. Mobile gave us the opportunity to start with a clean slate from a technology perspective.” Less than two years ago, eBay acquired Critical Path Software, which was helping to develop eBay’s mobile apps. “We thought they were the best, so we bought them and got a couple hundred of the best software developers in the world working exclusively for us,” Mr. Donahoe said.

The resulting mobile apps have been hugely successful with customers. “They’re a nice, clean, elegant solution, a very pleasant experience,” Mr. Spitz said. “Many people are encountering eBay on a mobile device and coming away with a great first impression.”

New products are in the pipeline. Mr. Donahoe said PayPal Here, a new payment system, would allow customers to “check in” in advance at a shop, be greeted by name when they arrive, complete transactions without a mobile device or credit card and get a text message as a receipt.

¶ Management change is necessary and inevitable. Mr. Donahoe has been chief for just over four years, and has replaced most of eBay’s top management. “A significant change in senior leadership was necessary to take eBay to the next level,” he said. He built a team of managers who shared his dedication “to building a great and enduring company, a company that will last,” as he put it. “No one else has really done that on the Internet, and we’re excited by the possibility.” At the same time, he said, “We can’t take anything for granted. We’re almost paranoid. We get up every morning and we’re focused on delivering for our customers and continuing to innovate. It’s a fast-changing world.”

    Behind eBay’s Comeback, NYT, 27.7.2012,
    http://www.nytimes.com/2012/07/28/business/ebays-turnaround-defies-convention-for-internet-companies.html

Facebook Shares Plummet in an Earnings Letdown

July 26, 2012
The New York Times
By SOMINI SENGUPTA

SAN FRANCISCO — Unhappy with Facebook’s first financial report as a public company Thursday, investors fled the stock in droves even as Mark Zuckerberg, the company’s chief executive, extolled its growth prospects to industry analysts.

Facebook’s stock lost 18 percent of its value Thursday. The first blow came during regular trading largely because of the poor results posted by Zynga, the social game company that uses Facebook as a platform.

But the stock continued to plummet in after-hours trading after Facebook announced its own numbers, dipping below $24, a record low. Since going public two months ago at $38 a share, Facebook shares have lost 37 percent of their value.

Mr. Zuckerberg has rarely spoken publicly about the company he built in his dorm room eight years ago. But nothing he and his lieutenants said Thursday about their plans to make money by advertising to Facebook users seemed to reassure investors.

“Obviously we’re disappointed about how the stock is traded,” said David Ebersman, the chief financial officer. “But the important thing for us is to stay focused on the fact that we’re the same company now as we were before.”

The financial report for the company’s second quarter did contain some good news. Revenue was up 32 percent, beating analysts’ predictions. But profits were not impressive, and the total number of users inched up only slowly.

“With the unprecedented hype around the company’s I.P.O., some investors believe more upside would have materialized — higher revenues, higher earnings,” said Jordan Rohan, an analyst at Stifel Nicolaus.

During the call with analysts, company executives emphasized their efforts to make Facebook accessible on mobile devices. The company only recently started surfacing advertisements in the mobile newsfeed. And while company executives said they were seeing promising results, they also said they were being careful not to crowd the mobile platform with too many advertisements, lest it spoil the user experience.

The company said 543 million people looked at Facebook on their mobile devices at the end of June, a 67 percent jump from last year.

“The shift towards mobile is incredibly important,” Mr. Zuckerberg said during the call.

The company said its revenue for the quarter climbed to $1.18 billion, from $895 million; most of it came from advertising. The company reported a net loss of $157 million, or 8 cents a share, compared with net income of $240 million, or 11 cents a share for the same quarter last year. Much of that was because of stock compensation, and on an adjusted basis, the company posted a profit of 12 cents a share, or $295 million, meeting analysts’ expectations.

Facebook, which already has nearly a billion users worldwide, is facing an inevitable slowdown in growth. The real issue, analysts have said, is whether the company can keep users glued to the site and profit from them by offering targeted advertisements, particularly on mobile devices.

“Before they were a public company, Facebook was judged by growth in users,” said Colin Sebastian, an analyst at Robert W. Baird & Company. “Now that they are so well penetrated in most Western markets, growth has to translate into monetization.”

Of particular concern, said Mark Mahaney, a Citibank analyst, is whether users are spending as much time on the site every day, considering how many more advertisements they are seeing on both mobile and desktop platforms. “Could you see Facebook fatigue? Could you see users using it less?” Mr. Mahaney asked.

Facebook, which is based in Menlo Park, Calif., made its debut on Wall Street in May. Investors were not expecting to see rosy earnings during this quarter, analysts said. Several said that the company would enjoy a grace period of sorts until early 2013 at least, but that it needed to lay out a clear road map to growing profits.

Advertising is Facebook’s principal moneymaker; the sale of mostly virtual goods on Zynga makes up the rest. But Facebook is widely thought to have other channels to make money. Its crown jewel is what its users share about themselves, including who they are, where they went to school, pictures of their children, political predilections and what they read and listen to.

Facebook has been aggressively experimenting with how to exploit all this data for its advertising efforts. It is testing how to sell advertisements elsewhere on the Web. And through its newest advertising tool, Facebook Exchange, it tracks the behavior of its users when they are visiting other sites and then serves up tailored advertisements when they return to Facebook.

Facebook has also been experimenting with so-called Sponsored Stories, which turn a user’s “like” of a certain brand into a product endorsement to his or her Facebook friends. On the earnings call, company executives said this kind of advertising was more lucrative than others. They said they planned to introduce more of these advertisements in the mobile and desktop platforms.

“We believe the best type of advertising is a message from their friends,” Mr. Zuckerberg said.

But the Sponsored Stories are at the center of a legal dispute. In a pending settlement of a class-action lawsuit, Facebook has agreed to make potentially costly changes to how these advertisements work.

The company has been aggressive in obtaining tools and talent to address its mobile challenge. In recent weeks it acquired a number of start-ups, including Glancee, a location sharing app whose creators are based in San Francisco; Face.com, an Israeli facial recognition technology company; and Acrylic Software, a Canadian application developer.

Brian Wieser, an analyst with Pivotal Research Group, said Facebook was such a new kind of company that it was difficult to know how to measure its progress.

“It is not a utility, it is not a newspaper, it’s not manufacturing,” he said. “It is unproven in terms of its durability.”

This article has been revised to reflect the following correction:

Correction: July 26, 2012

Because of an editing error, an earlier version of this article published online

misidentified the California city where Facebook is based. It is Menlo Park,

not Palo Alto.

    Facebook Shares Plummet in an Earnings Letdown, NYT, 26.7.2012,
    http://www.nytimes.com/2012/07/27/technology/facebook-reports-a-loss-but-its-revenue-beats-expectations.html

Amazon Delivers on Revenue but Not on Profit

July 26, 2012
The New York Times
By DAVID STREITFELD

SAN FRANCISCO — Leaping revenue, little profit.

That is the long-established Amazon story, and those who expected to hear it again Thursday were not disappointed.

The company reported sales of $12.8 billion, up 29 percent, in the second quarter while it eked out net income of $7 million, or a penny a share.

Those results essentially matched expectations. Analysts had estimated the Seattle-based retailer would earn 2 cents a share, down from 41 cents a share in the second quarter of 2011.

In what is becoming a routine warning, Amazon said that profit in the current quarter would remain elusive. Revenue might grow as much as 31 percent, the company said, but it was expecting a loss. Losses at Amazon were routine in its early years but in recent years it has made a profit, albeit a small one.

This would be devastating news from some Internet companies. But Amazon bulls were unfazed, saying the retailer was investing, as always, in the future.

“If they keep this up, there’s a good possibility that you’re looking at shopping malls going the way of the record store and the bookstore and the video rental store,” said Jason Moser, who covers Amazon for the Motley Fool investment site.

Amazon shares Thursday were up $3 to $220 during regular trading. The stock is trading only about 10 percent below its record high, with a stratospheric price-to-earnings ratio of about 170. In after-hours trading, shares continued rising.

Since its founding in 1994, Amazon has been focused on broadening its product and customer bases, not pumping up its profit margins. And the growth has been tremendous — it is now one of the country’s largest retailers. Even in North America, its most established market, it has been growing consistently more than twice as fast as the e-commerce market as a whole, a Forrester Research report released Thursday noted.

Amazon is building 18 new fulfillment centers around the world this year. In the United States, many of them are close to major cities, including New York City, San Francisco and Los Angeles. In a conference call with analysts, Thomas J. Szkutak, Amazon’s chief financial officer, said, “We’re investing certainly for the long term.”

In the past, Amazon declined to build warehouses in states where it had many customers, because it would then have to collect sales taxes from them. Now the promise of offering these areas even faster delivery seems to be more of an imperative than continuing to fight the tax issue.

Amazon fans probably dream of ordering books or bagels and getting them the same day. But Mr. Szkutak indicated this would remain a dream. “We don’t really see a way to do same-day delivery on a broad scale economically,” he cautioned.

Six of the new warehouses are already open. Getting some of the others ready for the all-important holiday season helps explain the predicted absence of profit in the third quarter. The centers are a large factor in Amazon’s accelerating head count, which is up 60 percent over the last year to 60,000 employees.

One word that was little mentioned during the call by either Mr. Szkutak or the analysts: Kindle. Amazon’s tablet, the Kindle Fire, was introduced last fall in an ocean of hype. New models are seen by some as overdue.

“We’re excited about the road map we have” for e-readers and e-books, Mr. Szkutak said. He declined to say what that map was.

    Amazon Delivers on Revenue but Not on Profit, NYT, 26.7.2012,
    http://www.nytimes.com/2012/07/27/technology/amazon-delivers-on-revenue-but-not-on-profit.html

Rise Is Seen in Cyberattacks Targeting U.S. Infrastructure

July 26, 2012
The New York Times
By DAVID E. SANGER and ERIC SCHMITT

ASPEN, Colo. — The top American military official responsible for defending the United States against cyberattacks said Thursday that there had been a 17-fold increase in computer attacks on American infrastructure between 2009 and 2011, initiated by criminal gangs, hackers and other nations.

The assessment by Gen. Keith B. Alexander, who heads the National Security Agency and also the newly created United States Cyber Command, appears to be the government’s first official acknowledgment of the pace at which America’s electricity grids, water supplies, computer and cellphone networks and other infrastructure are coming under attack. Those attacks are considered potentially far more serious than computer espionage or financial crimes.

General Alexander, who rarely speaks publicly, did not say how many attacks had occurred in that period. But he said that he thought the increase was unrelated to the release two years ago of a computer worm known as Stuxnet, which was aimed at taking down Iran’s uranium enrichment plant at Natanz.

When the worm inadvertently became public, many United States officials and outside experts expressed concern that it could be reverse-engineered and used against American targets. General Alexander said he saw no evidence of that.

General Alexander, as head of the N.S.A., was a crucial player in a covert American program called Olympic Games that targeted the Iranian program. But under questioning from Pete Williams of NBC News at a security conference here, he declined to say whether Stuxnet was American in origin; the Obama administration has never acknowledged using cyberweapons.

General Alexander said that what concerned him about the increase in foreign cyberattacks on the United States was that a growing number were aimed at “critical infrastructure,” and that the United States remained unprepared to ward off a major attack. On a scale of 1 to 10, he said, American preparedness for a large-scale cyberattack is “around a 3.” He urged passage of legislation, which may come to a vote in the next week, that would give the government new powers to defend private computer networks in the United States. The legislation has prompted a struggle as American companies try to avoid costly regulation on their networks, and some civil liberties groups express concern about the effect on privacy.

General Alexander said that the administration was still working out rules of engagement for responding to cyberattacks. Because an attack can take place in milliseconds, he said that some automatic defenses were necessary, as was the president’s involvement in any decisions about broader retaliation.

He confirmed that under existing authorities, only the president had the power to authorize an American-directed cyberattack. The first such attacks occurred under President George W. Bush.

The Pentagon has said previously that if the United States retaliated for an attack on its soil, the response could come in the form of a countercyberattack, or a traditional military response.

General Alexander spoke in a 75-minute interview at the Aspen Security Forum at the Aspen Institute here. The New York Times is a media sponsor of the four-day conference. Another conference speaker, Matthew Olsen, the director of the National Counterterrorism Center, addressed the escalating “hot war” between Israel and Iran and Iranian-backed groups like Hezbollah.

Iran has blamed Israel for assassinations of several of its nuclear scientists. Israel has accused Hezbollah operatives backed by Iran of carrying out the suicide bombing last week that killed five Israeli tourists and a local bus driver in Bulgaria.

The United States has said Iran was behind a thwarted plot last fall to kill Saudi Arabia’s ambassador to the United States.

“Both with respect to Iran and Hezbollah, we’re seeing a general uptick in the level of activity around the world in a number of places,” Mr. Olsen said.

Mr. Olsen did not address the Bulgaria attack, but he said the plot to kill the Saudi envoy in Washington “demonstrated that Iran absolutely had the intent to carry out a terrorist attack inside the United States.”

    Rise Is Seen in Cyberattacks Targeting U.S. Infrastructure, NYT, 26.7.2012,
    http://www.nytimes.com/2012/07/27/us/cyberattacks-are-up-national-security-chief-says.html

The News Isn’t Good for Zynga, Maker of FarmVille

July 25, 2012
The New York Times
By DAVID STREITFELD and JENNA WORTHAM

SAN FRANCISCO — The social games developer Zynga is withering faster than neglected corn on its signature hit FarmVille.

Weak second-quarter financial results and worse expectations for the rest of the year sent Zynga’s already faltering stock down in late trading Wednesday by more than a third, to $3.18 a share.

The unexpected news was seen as boding ill for Facebook, which is closely tied to Zynga and will issue its first earnings report as a public company on Thursday. Facebook shares fell 8 percent in late trading.

For Zynga, a Silicon Valley darling whose public offering last December seemed to herald a wave of tech success, just about everything went wrong at once.

A brief list: Facebook made changes to its gaming platform that hampered Zynga regulars. A critical new game, the Ville, was delayed. Another new game, Mafia Wars II, just was not very good, executives conceded. The heavily hyped Draw Something, acquired in March, proved more fad than enduring classic. Some old standbys also lost some appeal.

“Facebook made a number of changes in the quarter,” John Schappert, chief operating officer, said in a conference call with analysts. “These changes favored new games. Our users did not remain as engaged and did not come back as often.”

Revenue for the second quarter was $332 million, below analysts’ expectations of $343 million. And the company lost $22.8 million, or 3 cents a share in the quarter, although excluding one-time items it had a profit of 1 cent a share — still below expectations.

But the real problem was that Zynga slashed the forecast for its bookings — revenue less fees it pays Facebook — to as low as $1.15 billion for 2012, from $1.47 billion.

It was a somewhat contentious conference call. One analyst, Richard Greenfield of BTIG, brought up to Mark Pincus, Zynga’s chief executive, that he had sold stock at $12 a share shortly after the public offering. Mr. Pincus did not directly respond beyond saying “we believe in the opportunity for social gaming and play to be a mass-market activity, as it is already becoming.”

After the call, Mr. Greenfield downgraded Zynga’s stock to neutral from buy in a report titled, “We are sorry and embarrassed by our mistake.”

In an interview, Mr. Greenfield said: “Right now, everything is going wrong for Zynga. In a rapidly changing Internet landscape that is moving to mobile, it’s very hard to have confidence these issues are temporary.”

Most Zynga games are free. The company makes money from a small core of dedicated users who buy virtual goods like tractors in FarmVille. Over the last year, the average daily amount of money Zynga took in from these core users dropped 10 percent even as the overall number of users expanded.

“Zynga’s challenge has been to drive up efforts to keep their attention and broaden their user base — which they did — but now they need to get them to pay,” said Michael Gartenberg of Gartner. “Increasing the number of players doesn’t mean you’re making money off them.”

Mr. Gartenberg added a thought that would bring chills to any Zynga executive: “At the end of the day, though, virtual goods might not be a viable business strategy. People eventually stop spending money in virtual goods and want to spend that money on real goods.”

Zynga and Facebook are tied at the hip. Until recently, Zynga games could be played only on the Facebook platform, and for every dollar that users spent on buying virtual goods, Facebook pocketed 30 cents, its principal moneymaking channel other than advertising.

That partnership has continued. Zynga has seven of the top 10 games on Facebook. In a closely watched experiment, Facebook has started offering advertisements to its users on Zynga.com. It is the first time Facebook has spread ads outside its walls.

Zynga’s efforts to develop its own gaming platform independent of Facebook are still in the early stages. A Facebook spokesman declined to comment.

David Streitfeld reported from San Francisco and Jenna Wortham from New York.

Somini Sengupta contributed reporting from San Francisco.

    The News Isn’t Good for Zynga, Maker of FarmVille, NYT, 25.7.2012,
    http://www.nytimes.com/2012/07/26/technology/for-zynga-a-reversal-of-fortune.html

Verifying Ages Online Is a Daunting Task, Even for Experts

June 17, 2012
The New York Times
By NICOLE PERLROTH

SAN FRANCISCO — Just how hard can it be to verify the age of a person online?

After all, privacy experts have been complaining for years about how much advertisers know about people who use the Internet.

The answer, it turns out, is very hard. Despite attempts by privacy advocates, academics, law enforcement officials, technologists and advertisers to determine a person’s age on the Internet, the reality is that, online, it is extremely difficult to tell whether someone is an 11-year-old girl or a 45-year-old man.

The question arose last week after Skout, a mobile social networking app, discovered that, within two weeks, three adults had masqueraded as teenagers in its forum for 13- to 17-year-olds. In three separate incidents, they contacted children and, the police say, sexually assaulted them.

In response, Skout suspended its app for minors, appointed a task force of security specialists to investigate and find solutions and said it would not resume the service until it could find a better way to vet users’ ages online.

Skout said it had vetted its users ages through Facebook, which officially prohibits members under 13, but has acknowledged that children find ways to enter. Facebook said recently that it was experimenting with age verification tools that would allow people younger than 13 to join.

The resounding response from those who have studied age verification technologies, and, in some cases, put them in place, has been: good luck.

The problem is that everyone — not only sex offenders — has an incentive to lie. Children want to enter Web sites and forums where their older peers are.

The methods the pornography industry uses to confirm online identities of its customers, like credit cards and drivers licenses, cannot be used to identify minors, because the absence of those things does not necessarily mean the person is a child. Federal privacy laws also make it illegal for Web companies to knowingly collect personally identifiable information about children younger than 13.

And on social networks, where people can expect a degree of anonymity, the task of verifying someone’s age is even more difficult. In most cases, all it takes is an e-mail address to set up an account, and children can lie about their ages.

A serious effort to evaluate age verification technologies was made in 2008. At that time, when Facebook was one-ninth its current size, child safety advocates and law enforcement officials expressed concern about sexual predators pursuing children on Myspace, then a Facebook rival. An Internet Safety Technical Task Force was convened, and experts from academia and Web companies set to work examining various ways of verifying ages and sequestering children and adults online.

The task force met with 40 companies that said they had solved the problem. They included an ultrasound device maker that scanned users’ fingers to determine their age; a vendor that asked users for voice responses to questions so a team of voice analysts could listen for an “intent to deceive”; and a company that traveled from school to school persuading educators and parents to submit children’s personal information — sex, address, school, birth date — to an online database that would be accessible to Internet companies.

The first two ideas do not appear to have made it past the demonstration stage. The third lost momentum after privacy advocates questioned whether it was intended to protect children from predators, or sell them out to advertisers.

Four years later, members of that task force sound, at best, deflated.

“I began to learn that age verification technologies would not address any of the major safety issues we identified,” said Danah Boyd, a senior researcher at Microsoft and co-director of the task force.

An informal survey of major figures in the artificial intelligence industry revealed that little, if any, research is being done on age verification. The Defense Advanced Research Projects Agency, the technology financing arm of the Pentagon that has initiated many Silicon Valley wonders, said it was not pursuing any research on age verification. Microsoft, which has done some of the more ambitious research in identity management, is more focused on hiding users’ identities online than on exposing them.

“There has been very little progress, which is astonishing given recent incidents,” said Senator Richard Blumenthal, Democrat of Connecticut and a major advocate for age verification dating from his days as his state’s attorney general. “You would think, if we can put a man on the moon, we could verify whether someone on the Internet is 13,” he said.

“You never want to say never, but age verification has serious conceptual difficulties,” said Oren Etzioni, an artificial intelligence specialist and computer scientist at the University of Washington who has founded several technology companies. The problem, Dr. Etzioni and others say, is that the available options — establishing a national identity database, tracking users’ behavior or knowing the data on a person’s phone that might suggest an age group — are considered violations of privacy.

“Unlike Germany and South Korea, we don’t have a national ID system because we don’t like the idea of a big government database knowing everything about us from birth to death,” said Stephen Balkam, chief executive of the Family Online Safety Institute, a nonprofit group. “So we muddle through, using a variety of methods to discern how old people are, but they’re not exactly foolproof.”

A few start-ups are, again, experimenting with new technologies that could help verify ages online. Jumio Inc., in Linz, Austria, developed a technology that turns the Web camera on a personal computer or smartphone into a credit card or identification card reader and lets merchants scan ID’s online.

But technologists who have put age verification technologies in place say there is always a way to outsmart the system and that such technologies are, at best, a deterrent.

“Companies do age verification because they know they’re supposed to, but everybody knows it doesn’t really work,” said Hemanshu Nigam, the former chief security officer at Myspace who now runs SSP Blue, an online security consultancy. “The truth is, there is no silver bullet.”

The consensus is that the most effective solution for now is not the technologies, but good old-fashioned education and parental vigilance.

“Sequestering age levels will never be the solution online — it’s hard enough to do it in the so-called real world — and there will always be a work-around,” said Anne Collier, who served on the 2008 task force and runs NetFamilyNews. “Really, the single most important thing we can do is to educate parents and young people about what is happening online.”

    Verifying Ages Online Is a Daunting Task, Even for Experts, NYT, 17.6.2012,
    http://www.nytimes.com/2012/06/18/technology/verifying-ages-online-is-a-daunting-task-even-for-experts.html

Facebook Meets Brick-and-Mortar Politics

June 9, 2012
The New York Times
By THOMAS L. FRIEDMAN

Istanbul

I HAD just finished a panel discussion on Turkey and the Arab Spring at a regional conference here, and, as I was leaving, a young Egyptian woman approached me. “Mr. Friedman, could I ask you a question? Who should I vote for?”

I thought: “Why is she asking me about Obama and Romney?” No, no, she explained. It was her Egyptian election next week that she was asking about. Should she vote for Mohamed Morsi, the candidate of the Islamist Muslim Brotherhood, or Ahmed Shafiq, a retired general who served as Hosni Mubarak’s last prime minister and was running as a secular law-and-order candidate? My heart went out to her. As Egyptian democracy activists say: It’s like having to choose between two diseases. How sad that 18 months after a democratic revolution, Egyptians have been left with a choice between a candidate anchored in 1952, when Egypt’s military seized power, and a candidate anchored in 622, when the Prophet Muhammad gave birth to Islam.

What happened to the “Facebook Revolution”?

Actually, Facebook is having a bad week — in the stock market and the ideas market. As a liberal Egyptian friend observed, “Facebook really helped people to communicate, but not to collaborate.” No doubt Facebook helped a certain educated class of Egyptians to spread the word about the Tahrir Revolution. Ditto Twitter. But, at the end of the day, politics always comes down to two very old things: leadership and the ability to get stuff done. And when it came to those, both the Egyptian Army and the Muslim Brotherhood, two old “brick and mortar” movements, were much more adept than the Facebook generation of secular progressives and moderate Islamists — whose candidates together won more votes than Morsi and Shafik combined in the first round of voting but failed to make the runoff because they divided their votes among competing candidates who would not align.

To be sure, Facebook, Twitter and blogging are truly revolutionary tools of communication and expression that have brought so many new and compelling voices to light. At their best, they’re changing the nature of political communication and news. But, at their worst, they can become addictive substitutes for real action. How often have you heard lately: “Oh, I tweeted about that.” Or “I posted that on my Facebook page.” Really? In most cases, that’s about as impactful as firing a mortar into the Milky Way galaxy. Unless you get out of Facebook and into someone’s face, you really have not acted. And, as Syria’s vicious regime is also reminding us: “bang-bang” beats “tweet-tweet” every day of the week.

Commenting on Egypt’s incredibly brave Facebook generation rebels, the political scientist Frank Fukuyama recently wrote: “They could organize protests and demonstrations, and act with often reckless courage to challenge the old regime. But they could not go on to rally around a single candidate, and then engage in the slow, dull, grinding work of organizing a political party that could contest an election, district by district. ... Facebook, it seems, produces a sharp, blinding flash in the pan, but it does not generate enough heat over an extended period to warm the house.”

Let’s be fair. The Tahrir youths were up against two well-entrenched patronage networks. They had little time to build grass-roots networks in a country as big as Egypt. That said, though, they could learn about leadership and the importance of getting things done by studying Turkey’s Islamist Justice and Development Party, known as A.K.P. It has been ruling here since 2002, winning three consecutive elections.

What even the A.K.P.’s biggest critics will acknowledge is that it has transformed Turkey in a decade into an economic powerhouse with a growth rate second only to China. And it did so by unlocking its people’s energy — with good economic management and reformed universal health care, by removing obstacles and creating incentives for business and foreign investment, and by building new airports, rail lines, roads, tunnels, bridges, wireless networks and sewers all across the country. A Turkish journalist who detests the A.K.P. confessed to me that she wished the party had won her municipal elections, because she knew it would have improved the neighborhood.

But here’s the problem: The A.K.P.’s impressively effective prime minister, Recep Tayyip Erdogan, has not only been effective at building bridges but also in eliminating any independent judiciary in Turkey and in intimidating the Turkish press so that there are no more checks and balances here. With the economic decline of the European Union, the aborting of Turkey’s efforts to become an E.U. member and the need for America to have Turkey as an ally in managing Iraq, Iran and Syria, there are also no external checks on the A.K.P.’s rising authoritarianism. (Erdogan announced out of the blue last week that he intended to pass a law severely restricting abortions.)

So many conversations I had with Turks here ended with me being told: “Just don’t quote me. He can be very vindictive.” It’s like China.

This isn’t good. If Erdogan’s “Sultanization” of Turkey continues unchecked, it will soil his truly significant record and surely end up damaging Turkish democracy. It will also be bad for the region because whoever wins the election in Egypt, when looking for a model to follow, will see the E.U. in shambles, the Obama team giving Erdogan a free pass and Turkey thriving under a system that says: Give your people growth and you can gradually curb democratic institutions and impose more religion as you like.

    Facebook Meets Brick-and-Mortar Politics, NYT, 9.6.2012,
    http://www.nytimes.com/2012/06/10/opinion/sunday/friedman-facebook-meets-brick-and-mortar-politics.html

Obama Order Sped Up Wave of Cyberattacks Against Iran

June 1, 2012
The New York Times
By DAVID E. SANGER

WASHINGTON — From his first months in office, President Obama secretly ordered increasingly sophisticated attacks on the computer systems that run Iran’s main nuclear enrichment facilities, significantly expanding America’s first sustained use of cyberweapons, according to participants in the program.

Mr. Obama decided to accelerate the attacks — begun in the Bush administration and code-named Olympic Games — even after an element of the program accidentally became public in the summer of 2010 because of a programming error that allowed it to escape Iran’s Natanz plant and sent it around the world on the Internet. Computer security experts who began studying the worm, which had been developed by the United States and Israel, gave it a name: Stuxnet.

At a tense meeting in the White House Situation Room within days of the worm’s “escape,” Mr. Obama, Vice President Joseph R. Biden Jr. and the director of the Central Intelligence Agency at the time, Leon E. Panetta, considered whether America’s most ambitious attempt to slow the progress of Iran’s nuclear efforts had been fatally compromised.

“Should we shut this thing down?” Mr. Obama asked, according to members of the president’s national security team who were in the room.

Told it was unclear how much the Iranians knew about the code, and offered evidence that it was still causing havoc, Mr. Obama decided that the cyberattacks should proceed. In the following weeks, the Natanz plant was hit by a newer version of the computer worm, and then another after that. The last of that series of attacks, a few weeks after Stuxnet was detected around the world, temporarily took out nearly 1,000 of the 5,000 centrifuges Iran had spinning at the time to purify uranium.

This account of the American and Israeli effort to undermine the Iranian nuclear program is based on interviews over the past 18 months with current and former American, European and Israeli officials involved in the program, as well as a range of outside experts. None would allow their names to be used because the effort remains highly classified, and parts of it continue to this day.

These officials gave differing assessments of how successful the sabotage program was in slowing Iran’s progress toward developing the ability to build nuclear weapons. Internal Obama administration estimates say the effort was set back by 18 months to two years, but some experts inside and outside the government are more skeptical, noting that Iran’s enrichment levels have steadily recovered, giving the country enough fuel today for five or more weapons, with additional enrichment.

Whether Iran is still trying to design and build a weapon is in dispute. The most recent United States intelligence estimate concludes that Iran suspended major parts of its weaponization effort after 2003, though there is evidence that some remnants of it continue.

Iran initially denied that its enrichment facilities had been hit by Stuxnet, then said it had found the worm and contained it. Last year, the nation announced that it had begun its own military cyberunit, and Brig. Gen. Gholamreza Jalali, the head of Iran’s Passive Defense Organization, said that the Iranian military was prepared “to fight our enemies” in “cyberspace and Internet warfare.” But there has been scant evidence that it has begun to strike back.

The United States government only recently acknowledged developing cyberweapons, and it has never admitted using them. There have been reports of one-time attacks against personal computers used by members of Al Qaeda, and of contemplated attacks against the computers that run air defense systems, including during the NATO-led air attack on Libya last year. But Olympic Games was of an entirely different type and sophistication.

It appears to be the first time the United States has repeatedly used cyberweapons to cripple another country’s infrastructure, achieving, with computer code, what until then could be accomplished only by bombing a country or sending in agents to plant explosives. The code itself is 50 times as big as the typical computer worm, Carey Nachenberg, a vice president of Symantec, one of the many groups that have dissected the code, said at a symposium at Stanford University in April. Those forensic investigations into the inner workings of the code, while picking apart how it worked, came to no conclusions about who was responsible.

A similar process is now under way to figure out the origins of another cyberweapon called Flame that was recently discovered to have attacked the computers of Iranian officials, sweeping up information from those machines. But the computer code appears to be at least five years old, and American officials say that it was not part of Olympic Games. They have declined to say whether the United States was responsible for the Flame attack.

Mr. Obama, according to participants in the many Situation Room meetings on Olympic Games, was acutely aware that with every attack he was pushing the United States into new territory, much as his predecessors had with the first use of atomic weapons in the 1940s, of intercontinental missiles in the 1950s and of drones in the past decade. He repeatedly expressed concerns that any American acknowledgment that it was using cyberweapons — even under the most careful and limited circumstances — could enable other countries, terrorists or hackers to justify their own attacks.

“We discussed the irony, more than once,” one of his aides said. Another said that the administration was resistant to developing a “grand theory for a weapon whose possibilities they were still discovering.” Yet Mr. Obama concluded that when it came to stopping Iran, the United States had no other choice.

If Olympic Games failed, he told aides, there would be no time for sanctions and diplomacy with Iran to work. Israel could carry out a conventional military attack, prompting a conflict that could spread throughout the region.

A Bush Initiative

The impetus for Olympic Games dates from 2006, when President George W. Bush saw few good options in dealing with Iran. At the time, America’s European allies were divided about the cost that imposing sanctions on Iran would have on their own economies. Having falsely accused Saddam Hussein of reconstituting his nuclear program in Iraq, Mr. Bush had little credibility in publicly discussing another nation’s nuclear ambitions. The Iranians seemed to sense his vulnerability, and, frustrated by negotiations, they resumed enriching uranium at an underground site at Natanz, one whose existence had been exposed just three years before.

Iran’s president, Mahmoud Ahmadinejad, took reporters on a tour of the plant and described grand ambitions to install upward of 50,000 centrifuges. For a country with only one nuclear power reactor — whose fuel comes from Russia — to say that it needed fuel for its civilian nuclear program seemed dubious to Bush administration officials. They feared that the fuel could be used in another way besides providing power: to create a stockpile that could later be enriched to bomb-grade material if the Iranians made a political decision to do so.

Hawks in the Bush administration like Vice President Dick Cheney urged Mr. Bush to consider a military strike against the Iranian nuclear facilities before they could produce fuel suitable for a weapon. Several times, the administration reviewed military options and concluded that they would only further inflame a region already at war, and would have uncertain results.

For years the C.I.A. had introduced faulty parts and designs into Iran’s systems — even tinkering with imported power supplies so that they would blow up — but the sabotage had had relatively little effect. General James E. Cartwright, who had established a small cyberoperation inside the United States Strategic Command, which is responsible for many of America’s nuclear forces, joined intelligence officials in presenting a radical new idea to Mr. Bush and his national security team. It involved a far more sophisticated cyberweapon than the United States had designed before.

The goal was to gain access to the Natanz plant’s industrial computer controls. That required leaping the electronic moat that cut the Natanz plant off from the Internet — called the air gap, because it physically separates the facility from the outside world. The computer code would invade the specialized computers that command the centrifuges.

The first stage in the effort was to develop a bit of computer code called a beacon that could be inserted into the computers, which were made by the German company Siemens and an Iranian manufacturer, to map their operations. The idea was to draw the equivalent of an electrical blueprint of the Natanz plant, to understand how the computers control the giant silvery centrifuges that spin at tremendous speeds. The connections were complex, and unless every circuit was understood, efforts to seize control of the centrifuges could fail.

Eventually the beacon would have to “phone home” — literally send a message back to the headquarters of the National Security Agency that would describe the structure and daily rhythms of the enrichment plant. Expectations for the plan were low; one participant said the goal was simply to “throw a little sand in the gears” and buy some time. Mr. Bush was skeptical, but lacking other options, he authorized the effort.

Breakthrough, Aided by Israel

It took months for the beacons to do their work and report home, complete with maps of the electronic directories of the controllers and what amounted to blueprints of how they were connected to the centrifuges deep underground.

Then the N.S.A. and a secret Israeli unit respected by American intelligence officials for its cyberskills set to work developing the enormously complex computer worm that would become the attacker from within.

The unusually tight collaboration with Israel was driven by two imperatives. Israel’s Unit 8200, a part of its military, had technical expertise that rivaled the N.S.A.’s, and the Israelis had deep intelligence about operations at Natanz that would be vital to making the cyberattack a success. But American officials had another interest, to dissuade the Israelis from carrying out their own pre-emptive strike against the Iranian nuclear facilities. To do that, the Israelis would have to be convinced that the new line of attack was working. The only way to convince them, several officials said in interviews, was to have them deeply involved in every aspect of the program.

Soon the two countries had developed a complex worm that the Americans called “the bug.” But the bug needed to be tested. So, under enormous secrecy, the United States began building replicas of Iran’s P-1 centrifuges, an aging, unreliable design that Iran purchased from Abdul Qadeer Khan, the Pakistani nuclear chief who had begun selling fuel-making technology on the black market. Fortunately for the United States, it already owned some P-1s, thanks to the Libyan dictator, Col. Muammar el-Qaddafi.

When Colonel Qaddafi gave up his nuclear weapons program in 2003, he turned over the centrifuges he had bought from the Pakistani nuclear ring, and they were placed in storage at a weapons laboratory in Tennessee. The military and intelligence officials overseeing Olympic Games borrowed some for what they termed “destructive testing,” essentially building a virtual replica of Natanz, but spreading the test over several of the Energy Department’s national laboratories to keep even the most trusted nuclear workers from figuring out what was afoot.

Those first small-scale tests were surprisingly successful: the bug invaded the computers, lurking for days or weeks, before sending instructions to speed them up or slow them down so suddenly that their delicate parts, spinning at supersonic speeds, self-destructed. After several false starts, it worked. One day, toward the end of Mr. Bush’s term, the rubble of a centrifuge was spread out on the conference table in the Situation Room, proof of the potential power of a cyberweapon. The worm was declared ready to test against the real target: Iran’s underground enrichment plant.

“Previous cyberattacks had effects limited to other computers,” Michael V. Hayden, the former chief of the C.I.A., said, declining to describe what he knew of these attacks when he was in office. “This is the first attack of a major nature in which a cyberattack was used to effect physical destruction,” rather than just slow another computer, or hack into it to steal data.

“Somebody crossed the Rubicon,” he said.

Getting the worm into Natanz, however, was no easy trick. The United States and Israel would have to rely on engineers, maintenance workers and others — both spies and unwitting accomplices — with physical access to the plant. “That was our holy grail,” one of the architects of the plan said. “It turns out there is always an idiot around who doesn’t think much about the thumb drive in their hand.”

In fact, thumb drives turned out to be critical in spreading the first variants of the computer worm; later, more sophisticated methods were developed to deliver the malicious code.

The first attacks were small, and when the centrifuges began spinning out of control in 2008, the Iranians were mystified about the cause, according to intercepts that the United States later picked up. “The thinking was that the Iranians would blame bad parts, or bad engineering, or just incompetence,” one of the architects of the early attack said.

The Iranians were confused partly because no two attacks were exactly alike. Moreover, the code would lurk inside the plant for weeks, recording normal operations; when it attacked, it sent signals to the Natanz control room indicating that everything downstairs was operating normally. “This may have been the most brilliant part of the code,” one American official said.

Later, word circulated through the International Atomic Energy Agency, the Vienna-based nuclear watchdog, that the Iranians had grown so distrustful of their own instruments that they had assigned people to sit in the plant and radio back what they saw.

“The intent was that the failures should make them feel they were stupid, which is what happened,” the participant in the attacks said. When a few centrifuges failed, the Iranians would close down whole “stands” that linked 164 machines, looking for signs of sabotage in all of them. “They overreacted,” one official said. “We soon discovered they fired people.”

Imagery recovered by nuclear inspectors from cameras at Natanz — which the nuclear agency uses to keep track of what happens between visits — showed the results. There was some evidence of wreckage, but it was clear that the Iranians had also carted away centrifuges that had previously appeared to be working well.

But by the time Mr. Bush left office, no wholesale destruction had been accomplished. Meeting with Mr. Obama in the White House days before his inauguration, Mr. Bush urged him to preserve two classified programs, Olympic Games and the drone program in Pakistan. Mr. Obama took Mr. Bush’s advice.
 

The Stuxnet Surprise

Mr. Obama came to office with an interest in cyberissues, but he had discussed them during the campaign mostly in terms of threats to personal privacy and the risks to infrastructure like the electrical grid and the air traffic control system. He commissioned a major study on how to improve America’s defenses and announced it with great fanfare in the East Room.

What he did not say then was that he was also learning the arts of cyberwar. The architects of Olympic Games would meet him in the Situation Room, often with what they called the “horse blanket,” a giant foldout schematic diagram of Iran’s nuclear production facilities. Mr. Obama authorized the attacks to continue, and every few weeks — certainly after a major attack — he would get updates and authorize the next step. Sometimes it was a strike riskier and bolder than what had been tried previously.

“From his first days in office, he was deep into every step in slowing the Iranian program — the diplomacy, the sanctions, every major decision,” a senior administration official said. “And it’s safe to say that whatever other activity might have been under way was no exception to that rule.”

But the good luck did not last. In the summer of 2010, shortly after a new variant of the worm had been sent into Natanz, it became clear that the worm, which was never supposed to leave the Natanz machines, had broken free, like a zoo animal that found the keys to the cage. It fell to Mr. Panetta and two other crucial players in Olympic Games — General Cartwright, the vice chairman of the Joint Chiefs of Staff, and Michael J. Morell, the deputy director of the C.I.A. — to break the news to Mr. Obama and Mr. Biden.

An error in the code, they said, had led it to spread to an engineer’s computer when it was hooked up to the centrifuges. When the engineer left Natanz and connected the computer to the Internet, the American- and Israeli-made bug failed to recognize that its environment had changed. It began replicating itself all around the world. Suddenly, the code was exposed, though its intent would not be clear, at least to ordinary computer users.

“We think there was a modification done by the Israelis,” one of the briefers told the president, “and we don’t know if we were part of that activity.”

Mr. Obama, according to officials in the room, asked a series of questions, fearful that the code could do damage outside the plant. The answers came back in hedged terms. Mr. Biden fumed. “It’s got to be the Israelis,” he said. “They went too far.”

In fact, both the Israelis and the Americans had been aiming for a particular part of the centrifuge plant, a critical area whose loss, they had concluded, would set the Iranians back considerably. It is unclear who introduced the programming error.

The question facing Mr. Obama was whether the rest of Olympic Games was in jeopardy, now that a variant of the bug was replicating itself “in the wild,” where computer security experts can dissect it and figure out its purpose.

“I don’t think we have enough information,” Mr. Obama told the group that day, according to the officials. But in the meantime, he ordered that the cyberattacks continue. They were his best hope of disrupting the Iranian nuclear program unless economic sanctions began to bite harder and reduced Iran’s oil revenues.

Within a week, another version of the bug brought down just under 1,000 centrifuges. Olympic Games was still on.

A Weapon’s Uncertain Future

American cyberattacks are not limited to Iran, but the focus of attention, as one administration official put it, “has been overwhelmingly on one country.” There is no reason to believe that will remain the case for long. Some officials question why the same techniques have not been used more aggressively against North Korea. Others see chances to disrupt Chinese military plans, forces in Syria on the way to suppress the uprising there, and Qaeda operations around the world. “We’ve considered a lot more attacks than we have gone ahead with,” one former intelligence official said.

Mr. Obama has repeatedly told his aides that there are risks to using — and particularly to overusing — the weapon. In fact, no country’s infrastructure is more dependent on computer systems, and thus more vulnerable to attack, than that of the United States. It is only a matter of time, most experts believe, before it becomes the target of the same kind of weapon that the Americans have used, secretly, against Iran.

This article is adapted from “Confront and Conceal: Obama’s Secret Wars

and Surprising Use of American Power,” to be published by Crown on Tuesday.

    Obama Order Sped Up Wave of Cyberattacks Against Iran, NYT, 1.6.2012,
    http://www.nytimes.com/2012/06/01/world/middleeast/obama-ordered-wave-of-cyberattacks-against-iran.html