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Archive for July, 2009

Grinch Alert: Barry Diller

The GrinchAccording to, Barry Diller (Chairman and CEO of IAC/InterActiveCorp) has joined a growing list of corporate executives trying to convince the public that they should pay for the online content that has largely been produced by the public — for free:

“It is not free, and is not going to be,” Diller said today at the Fortune Brainstorm conference in Pasadena, California. In addition to IAC, he is chairman of Expedia Inc., the online travel service, and Ticketmaster Entertainment Inc.

Diller, 67, joined a group of media chiefs, from Liberty Media Corp.’s John Malone to Walt Disney Co. CEO Robert Iger, who are challenging the accepted model that consumers pay for Internet access and then content is free. Diller predicted there will be three revenue streams: advertising, subscriptions and transactions.”

Advertising and transactions are one thing – while both are fraught with ethical, moral, and legal concerns, they have nonetheless become established “revenue streams” for many online companies. The advanced targeting capabilities afforded by the Internet delivers consumers to corporations more effectively than print media or television could have ever dreamed (e.g. facebook), and many people — myself included — have demonstrated a willingness to pay (or pay more) for “secure” transactions (e.g. PayPal). But subscriptions? Why should anyone have to pay for online content, the overwhelming majority of which has been freely produced by the public?

Propertizing free information, and charging people to access it, is an awfully Grinch thing to do.

Amazon gets Orwellian with Orwell

On 07.17.09 Amazon got a bit Orwellian by remotely deleting copies of George Orwell’s 1984 and Animal Farm from people’s Kindles — copies that were legitimately purchased from Amazon (the original purchase was credited to people’s accounts). The Kindle is a small, portable and proprietary e-book reader — in many ways, Kindle is an iPod for print media. By controlling both the hardware and software that constitute the Kindle, Amazon can tightly regulate to whom, where, and how long e-books are made available. Amazon/Kindle thus becomes the marketing/distribution medium connecting publishing companies (who are interested in “monetizing” their IP in cyberspace) and informational consumers (who are increasingly encouraged to pay for — formerly — free content).

Last August, I blogged about Apple’s decision to embedded a remote kill switch in the iPhone’s operating system that allowed them to deactivate applications of their choosing — including applications which were knowingly installed by an iPhone’s owner. At the time, I argued that Apple’s “security” decision to censor what applications I could and could not install on my iPhone, as well as it’s flagrant surveillance of what I did with my iPhone, made me feel a lot less safe and a lot less secure. The current Kindle snafu isn’t all that different. Not only is Amazon asserting their right to retroactively terminate past purchases (raising important questions of censorship as well as what exactly we get to “own” in exchange for our hard-earned cash) but they are also displaying their ability to monitor all information flowing through the Kindle.

If you bought a Kindle from Amazon, and if you bought an e-book from Amazon to read on your Kindle, then what right does Amazon or some publisher have to continue regulating those technologies? Sony can’t regulate what shows I watch on my TV, and my local bookstore can’t pull a “my bad!” and retrieve a book they’ve sold me. With all the moral grandstanding over IP / copyrights (from the  AAP, RIAA, MPAA, and so on…) at what point will we start respecting people’s rights to the intellectual property they legitimately produced or purchased? What about our property rights?

child labour?

Inc. on 11 year old Owen Voorhees, creator of the “Math Time” iPhone App:

Murphy believes the billion-dollar iPhone industry will keep growing. MathTime, a 99-cent application, was downloaded 141 times in a day. “It started booming,” says Owen, “I woke up, and I was like, ‘I’m an entrepreneur now.’

Goldman Sachs and the war on (loose) code

Loose nukes code is fast becoming an object of national security. Like their industrial cold war predecessors, code  has been framed as the informational equivalent of a loose nuke — potentially capable of obliterating markets and governments if obtained by a rogue state hacker. This growing meme has been furthered most recently by the news of an ex-Goldman Sachs computer programmer who allegedly circulated proprietary trading code:

Sergey Aleynikov, an ex-Goldman Sachs computer programmer, was arrested July 3 after arriving at Liberty International Airport in Newark, New Jersey, U.S. officials said…

At a court appearance July 4 in Manhattan, Assistant U.S. Attorney Joseph Facciponti told a federal judge that Aleynikov’s alleged theft poses a risk to U.S. markets. Aleynikov transferred the code, which is worth millions of dollars, to a computer server in Germany, and others may have had access to it, Facciponti said, adding that New York-based Goldman Sachs may be harmed if the software is disseminated.

According to Reuters, who broke the story:

Federal authorities say the platform quickly processes rapid developments in the markets and uses top secret mathematical formulas to allow the firm to make highly-profitable automated trades.

Aside from its entertaining similarities with the 1997 film The Spanish Prisoner, I find this news story particularly interesting b/c of the way it brings into focus 4 interrelated phenomena:

  1. Automated trading software has become a prominent actor in the manipulation of national and global markets.
  2. Corporate propertization of code has become a strategy for shaping such manipulation (cf. 1) according to its own economic interests.
  3. Government has engaged in globally policing proprietary code to ensure that the informational restructuring of the economy (cf. 1 & 2) continues to favor current power-holders.
  4. Individuals within the informational work force have emerged as potentially destabilizing actors in informational restructuring (cf. 1 & 2) and are thus becoming objects of national cybersecurity (cf. 3).

As Jon Stokes over at ars technica argues, the US government and Goldman Sachs aren’t concerned that this proprietary trading code could manipulate the market (that’s exactly what it’s designed to do) — they’re concerned that if this code gets “loose” it could challenge Goldman’s standing as a primary market manipulator. Whether these allegations turn out to be true or not, what’s apparent is how this event has been framed as a “wake up call” (as a former chairman of the U.S. Securities and Exchange Commission put it) for  financial institutions to acknowledge the importance of their code by enhancing efforts to lock it down. This, naturally, requires greater government and private policing of informational borders, and greater surveillance of the individuals who interact with intellectual property in order to mitigate the potential power of certain informational workers.