June 9, 2007

Cheerleading Media Changes [6:45 pm]

Which is not so bad, provided that we also remember that this kind of disruption means that more than business needs reframing: Media Innovations, Leaping From Lab to Screen

ONCE upon a time, before “the convergence” — of computer power with telecommunications and media — companies generally knew where their market stopped and someone else’s began.

But the flood of technology has effectively washed away those boundaries.

Today, I watch “Lost” on my laptop and “Veronica Mars” on my iPod, not on the TV for which they were first intended. I can browse the Web on TV or on a game console, instead of on my computer. I can Skype my friend in Sweden from my computer, and never touch my phone. Instead, I use it to listen to music, take pictures and read e-mail during meetings. And almost every day, there is new stuff vying for what is left of my attention — new media, new devices, new functions on old devices — that might inspire me to abandon whatever I was watching or using, yesterday.

As a result, running a media or entertainment company in the 21st century is not for the faint of heart. [...]

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Plus Ça Change … [6:30 pm]

Well, actually, it’s not the same thing — now the Justice Department is being run by attorneys who have a very different agenda, and Microsoft has started playing the political game very well: Microsoft Finds Legal Defender in Justice Dept.

In the most striking recent example of the policy shift, the top antitrust official at the Justice Department last month urged state prosecutors to reject a confidential antitrust complaint filed by Google that is tied to a consent decree that monitors Microsoft’s behavior. [...]

The official, Thomas O. Barnett, an assistant attorney general, had until 2004 been a top antitrust partner at the law firm that has represented Microsoft in several antitrust disputes. At the firm, Justice Department officials said, he never worked on Microsoft matters. Still, for more than a year after arriving at the department, he removed himself from the case because of conflict of interest issues. Ethics lawyers ultimately cleared his involvement.

Mr. Barnett’s memo dismissing Google’s claims, sent to state attorneys general around the nation, alarmed many of them, they and other lawyers from five states said. Some state officials said they believed that Google’s complaint had merit. They also said that they could not recall receiving a request by any head of the Justice Department’s antitrust division to drop any inquiry.

[...] The complaint, which contends that Google’s desktop search tool is slowed down by Microsoft’s competing program, has not been made public by Google or the judge overseeing the Microsoft consent decree, Colleen Kollar-Kotelly of the Federal District Court in Washington. It is expected to be discussed at a hearing on the decree in front of Judge Kollar-Kotelly this month.

[...] Richard Blumenthal, the Connecticut attorney general, declined to talk about the substance of the complaint, or which company made it. But he said the memo from Mr. Barnett surprised him.

“Eyebrows were raised by this letter in our group, as much by the substance and tone as by the past relationship the author had had with Microsoft,” said Mr. Blumenthal, one of the few state prosecutors who has been involved in the case since its outset.

“In concept, if not directly word for word, it is the Microsoft-Netscape situation,” Mr. Blumenthal said. “The question is whether we’re seeing déjà vu all over again.”

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Patent Arguments, Past and Present [6:24 pm]

A Patent Lie

It’s not surprising that Microsoft — now an entrenched incumbent — has had a change of heart. But Mr. Gates was right in 1991: patents are bad for the software industry. Nothing illustrates that better than the conflict between Verizon and Vonage.

Vonage developed one of the first Internet telephone services and has attracted more than two million customers. But last year, Verizon — one of Vonage’s biggest competitors — sued for patent infringement and won a verdict in its favor in March.

The Gates memo predicted that a large company would “patent some obvious thing,” and that’s exactly what Verizon has done. Two of its patents cover the concept of translating phone numbers into Internet addresses. It is virtually impossible to create a consumer-friendly Internet telephone product without doing that. So if Verizon prevails on appeal, it will probably be able to drive Vonage out of business. Consumers will suffer from fewer choices and higher prices, and future competitors will be reluctant to enter markets dominated by patents.

[...] Only patent lawyers benefit from this kind of arms race. And Microsoft’s own history contradicts Mr. Smith’s claim that patents are essential for technological breakthroughs: Microsoft produced lots of innovative software before it received its first software patent in 1988. As more and more lawsuits rock the industry, we should ask if software patents are stifling innovation. Bill Gates certainly thought so in 1991, even if he won’t admit it today.

Related: Note to Inventors: Please Curb Your Enthusiasm

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Criticizing Google on Privacy [6:18 pm]

Watchdog group pans Googles privacy policies as worst on the Webpdf

The company says its stockpiles data to help its search engine better understand its users so it can deliver more relevant results and advertisements.

As Google becomes more knowledgeable about the people relying on its search engine and other free services, management hopes to develop more tools that recommend activities and other pursuits that might appeal to individual users.

Privacy International is particularly troubled by Googles ability to match data gathered by its search engine with information collected from other services such as e-mail, instant messaging and maps.

“Under the microscope, it turns out that Google is doing much more with our data than we ever imagined,” Davies said.

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