Clips October 8, 2003

[Lillie Coney <lillie.coney@xxxxxxx>]

Clips October 8, 
2003

ARTICLES

Despite Lines, Voting Goes Smoothly 
Judge suspends Vonage order [Internet Telephony]
Fairfax's Anteon Wins Homeland Security Contract
Crime gangs honing Net skills, says cyber cop 
Stolen video game source code circulating
OMB officially names Haycock chief architect 
Homeland Security ready to start ordering technology
DHS adopts biometrics for border control
P2P group seeks cross-industry detente

*******************************
Washington Post
Despite Lines, Voting Goes Smoothly 
Local Polling Places Find Luck With Strategies to Cope With Lengthy
Ballot
By Edward Walsh and Dan Keating
Wednesday, October 8, 2003; Page A19 

Voting in California's historic gubernatorial recall election appeared to
go smoothly yesterday, as fears of malfunctioning voting equipment and
widespread voter confusion over a ballot listing 135 candidates to
replace Gov. Gray Davis (D) failed to materialize. 

There were long lines at some polling places, where voters began arriving
even before the polls opened at 7 a.m., and scattered reports of polling
places opening late. Los Angeles County officials acknowledged that 15
polling places opened late, but said the latest was only about an hour
after the polls were supposed to open. 

But there were no indications of serious problems or irregularities at
most polling places across the state. According to exit polls, almost
nine out of 10 voters said they had no problems with the voting equipment
or the lengthy ballot. 

Because local elections officials had only a few weeks to prepare for the
balloting, there were about 10,000 fewer polling places than usual, which
some officials feared might depress the turnout. But that did not appear
to be the case, as the heavy voting continued throughout the day.

Some minority groups did complain that inadequately trained poll workers
failed to help voters who were confused about the location of their
polling place. 

The nonpartisan Field Poll projected that as many as 10 million
Californians would vote in the recall election, a 30 percent increase
over the 7.7 million people who voted in 2002 when Davis was elected to a
second term. A turnout of that size, representing 65 percent of the
state's 15.3 million registered voters, would be the largest for any
non-presidential election in California history. 

County elections officials mailed out more than 3.1 million absentee
ballots to voters who requested them, and as Election Day dawned more
than 2 million absentee ballots had been returned. The Field Poll
estimated that 2.6 million absentee ballots were to be cast in the
election. 

The first part of the ballot that confronted California voters was
simple. It asked whether Davis should be recalled from the office of
governor. That was followed by the second part of the ballot, listing the
names of the potential replacement candidates in random order that
differed in each of the state's 58 counties. 

All voters could vote for one of the 135 candidates on the ballot,
whether or not they voted to recall Davis. 

Outside his polling place in a mansion in Pacific Palisades, Republican
Arnold Schwarzenegger, who was elected governor in the second part of the
ballot as Davis was recalled from office, joked that he had no trouble
finding his name on the ballot. "I just went through 10 pages, and
you always look for the longest name," he said. 

Poll workers in Los Angeles said that during the morning there did not
appear to be much confusion in negotiating the ballot. 

"It's a land-office business," said Marshall Wernick, who was
signing in voters at a polling place in a computer store in Los Angeles.
"Usually it's so sleepy, we're like the Maytag repairman. But today,
I've never seen a turnout like this." 

Half a block away, at Pipi's Petunia Patch, a flower store that was
doubling as a polling place, poll inspector Lawrence Reyes said more than
230 people had voted before noon. "It has been much busier for this
election than previous elections," he said, noting that 37 had cast
ballots there in the 2002 election. 

Reyes said that although people were casting their votes on punch-card
machines, there had been no reported problems with the ballot. "We
encourage everyone to punch it hard so there won't be any chads," he
said. "We also tell them to check for chads."

Edana Tisherman said she had no trouble with the ballot Tuesday.
"There's been so much coverage of this, it's very simple," she
said. "I said, 'Four holes, no chads, we're gone.' " 

Vivo Bennett, who was escorting his mother at a Los Angeles polling
place, said he had no problems, either. "It just took a little while
to find who I wanted to vote for in the 135 people [on the ballot],"
he said. 

Bennett predicted that many voters who showed up later would be
disheartened by long delays to vote. "They'll be so discouraged they
won't even stay to vote," he said. 

Local elections officials faced a variety of problems in preparing for
the unprecedented recall. Yolo County, like many others in the state, had
to change its procedures to deal with the list of 135 candidates for a
single office. 

To do that, the names were printed on the fronts and backs of three punch
cards. But the ballot-reading machines have no way to know if a voter
marks one candidate on the first card and another candidate on the second
card, so voters in Yolo County were asked to do the sorting themselves.
Voters were instructed to punch out the spot for only one candidate, and
drop only that card into the ballot box, disposing of the extra two
cards. 

Other counties had employees go through the cards to make sure voters did
not cast extra votes on different cards. 

At midday Tuesday, Yolo County Clerk Freddie Oakley said she had not
received any complaints about her impromptu system of having voters
separate their own ballot cards, but realized there was some risk in the
system. 

"If three little old ladies say they were confused, I'll be
pilloried," she said. 

In Santa Cruz County, elections manager Gail Pellerin said the biggest
complaint was about candidates who had dropped out of the contest. She
said people who had cast absentee ballots earlier wanted another chance
to vote. 

But in most parts of the state, there appeared to be little voter
confusion. Joan Carlson, 60, a picture framer from Pasadena, had the 2000
presidential election debacle in Florida in mind when she cast her vote.

"It's very easy if you study the ballot beforehand and you know what
page to go to and where your candidate is," she said. "We've
heard so much about chads since the Florida election that it's pretty
much automatic that you flip it over and check for them so you don't have
any problems." 

Staff writer Dan Balz and special correspondent Kimberly Edds in Los
Angeles contributed to this report. 
*******************************
CNET News.com
Judge suspends Vonage order
Last modified: October 7, 2003, 4:28 PM PDT
By Ben Charny 
Staff Writer, CNET News.com

A federal judge on Tuesday ordered Minnesota regulators to stop forcing
Internet phone provider Vonage to abide by state telephone operator
rules. 

Judge Michael J. Davis made his decision during oral argument between
lawyers for Vonage and the Minnesota Public Utilities Commission,
according to his clerk's office. A written order will be made available
publicly by Friday.

We're very pleased," Vonage spokesman Mitchell Slepian
said.

The order bars Minnesota's Public Utilities Commission from treating
Vonage, and presumably other voice-over-Internet Protocol (VoIP)
providers, as it does regular telephone companies. In August, the state
ordered Vonage to get the proper telephone company business licenses and
to immediately pay fees to the state's Department of Administration to
support 911 services. 

IP phone service is a cheaper form of telephone calling that uses the
Internet, instead of a public telephone network. Free services like Skype
are drawing hundreds of thousands of users, while Vonage and other
subscription Net phone providers are drawing in new converts at a healthy
pace. Cable companies are also using IP phone service to enter the local
phone dialing business. 
*******************************
Washington Post
Fairfax's Anteon Wins Homeland Security Contract
By Anitha Reddy
Wednesday, October 8, 2003; Page E05 

Anteon International Inc. won a contract from the Department of Homeland
Security to provide a thousand card readers that will be used to check
foreigners' identities at ports of entry, the Fairfax information
technology firm said yesterday.

The machines will become part of the U.S. Visit program, a government
project that will eventually track every foreign visa holder entering or
leaving the country. The contract is estimated to be in the billions of
dollars, and technology contractors of all sizes are angling to get a
piece of the business.

Anteon's card-reader contract, worth $3.6 million, is not part of the
multibillion-dollar contract to build the primary monitoring system.
Though the two contracts are not linked, Anteon and some analysts believe
that yesterday's award could give the company an edge when it competes
for work on the much larger U.S. Visit contract.

With deadlines to begin instituting U.S. Visit quickly approaching -- the
primary contract is to be awarded in May, and the system should be rolled
out by the end of 2005 -- officials in the department will have to rely
at least partially on existing technologies such as Anteon's card reader,
said Mark C. Jordan, an analyst for A.G. Edwards & Sons.

"Clearly, they respect Anteon enough to buy this," Jordan said.

The readers will compare biometric data, such as fingerprints, with the
data stored on 13 million cards carried by permanent immigrants and
Mexican and Canadian citizens who cross the border frequently. The
Department of Homeland Security plans to expand biometric checks to
almost all foreign visa holders by the end of 2004, so Anteon's card
readers will be closely watched as a test of the system on a small
scale.

At least half of the readers will be delivered to the department before
January, so the department may use them to meet its Dec. 31 deadline to
check the fingerprints of all foreign visa holders entering the country
through airports and seaports.

If the readers work smoothly, Anteon's reputation could get a boost
shortly before the Department of Homeland Security awards the giant U.S.
Visit contract to a team of companies in the spring. 

"Anytime you can get some type of reference base and show people
that [your product] works and it's cost-effective, that should give you
an advantage," said William R. Loomis, an analyst for Legg
Mason.

Mark Heilman, Anteon's executive vice president of corporate development,
said the Department of Homeland Security's decision to choose Anteon's
laser card readers could set a precedent for other agencies with plans to
introduce smart cards as IDs, such as the State Department. 

Lockheed Martin Corp., Computer Sciences Corp. and Accenture are the only
firms leading teams to bid on the broader U.S. Visit contract. Anteon is
a member of one of the teams, but officials declined to say which one.

Eric Stange, head of Accenture's defense and homeland security business,
said in an interview yesterday that the company's team will include
Raytheon Co., Dell Inc., Sprint Communications Co., SRA International
Inc., Datatrac Information Services Inc., Global Technology Management
Inc., Sandler and Travis Trade Advisory Services Inc., and Titan Corp.

SRA International is based in Fairfax, Global Technology Management Inc.
is based in Vienna, and Sandler and Travis Trade Advisory Services is
headquartered in Baltimore.

Lockheed Martin Corp. and Computer Sciences Corp. have already announced
their preliminary teams.
*******************************
USA Today
Crime gangs honing Net skills, says cyber cop 
By Bernhard Warner, Reuters
Posted 10/7/2003 10:52 AM 

LONDON - Organized crime syndicates have stepped up their presence on the
Internet, operating extortion rackets, child pornography rings and
elaborate financial scams, Britain's top cyber cop told 
Reuters.

And the most vulnerable target is the individual Web user, said Detective
Chief Superintendent Len Hynds, head of the UK's National Hi-Tech Crime
Unit (NHTCU).

"Organized crime is turning to the weakest element in the chain,
which is the people. It's the hands on the keyboard on either end of the
transaction that is the actual weak point," Hynds said.

The crime syndicates, he said, are based in every corner of the globe.
Investigations have led the NHTCU repeatedly to Eastern European
countries, including Ukraine, Russia and Latvia.

The groups have honed their Internet skills as a greater flow of business
is conducted online.

"Organised crime in all its guises is extremely flexible. It does
spot the new and lucrative opportunity," Hynds said.

Blackmail, extortion, child porn

In the NHTCU's two-year existence, the 55-person task force has made
nearly 110 arrests for such age-old crimes as blackmail and extortion to
decidedly hi-tech computer hacking cases.

Law enforcement officials throughout the world suspect crime rings are
recruiting technically savvy programmers to concoct fraud schemes against
banks and businesses.

An increasingly common scam hitting financial institutions is known as
"Web site spoofing" in which a fraudster sets up a bogus online
business that closely resembles a bank or business Web site.

The aim is to lure unsuspecting Internet users to the phoney site in an
effort to get them to submit their credit card and bank details. The
NHTCU said 40 UK businesses have been hit by the spoofing scam so far
this year, up from seven a year ago.

 From teenage tricks to organized crime

Hacking attacks, once considered the domain of bored teenagers looking to
prove their Net skills, have also become an increasingly common weapon in
organized crime's arsenal, said Hynds.

Some have launched "denial of service" attacks which consists
of a crippling barrage of data capable of knocking Net companies offline
against Internet service providers and online casinos.

Under such a scenario, the groups threaten to unleash the attacks on
businesses unless they pay a ransom.

But the most active area for the NHTCU, and the new cyber investigation
teams everywhere, continues to be breaking up child pornography rings.
Nearly half of the 110 arrests made by the unit have been for
pedophilia-related charges, Hynds said.

"We are focusing on the organized groups that are making money out
of peddling child pornography on the Internet. We are doing that in
partnership with business and industry," he said.

"We've deployed officers from this office overseas to physically
remove children to places of safety," he added.

International police forces have been tackling the rise of child
pornography online with greater success recently. Last week, German
police said they cracked a global paedophile ring that involved 26,500
computer users from 166 countries.
*******************************
USA Today
Stolen video game source code circulating
By Peter Svensson, Associated Press
Posted 10/7/2003 7:05 PM

NEW YORK  After perhaps the most egregious case of piracy to hit
video gaming, playable parts of the year's most eagerly anticipated title
were reported circulating online Tuesday. 
Gamer Web sites said a considerable portion of Half-Life 2, the sequel to
a very popular PC action game, was available in piracy circles. 

The game had been scheduled for release late this year and were
unconfirmed media reports said the leak would force a rewrite of some
parts of the game, delaying its release until April. 

Phone calls by The Associated Press seeking comment to the Los Angeles
offices of the distributor, Vivendi Universal Games, were not returned.
Nor were calls returned by the game's developer, Valve of Bellevue, Wash.

According to the gaming fan site Planethalflife.com, a partial version of
Half-Life 2 was "floating around" online. Another site,
hl2world.com, posted screen shots and a video clip apparently from the
pirated game. 

"Whatever is out there, I can't say if it's the entire game, but
some people say it is," said Rob Shively, chief executive of network
security consultancy PivX Solutions. 

A smaller part of the game's code was available last week after a hacker
broke into a computer at Valve. But that code was of little use to
players. The playable code surfaced early Tuesday. 

David Cole, game industry analyst at DFC Intelligence, said Half-Life 2
was expected to be the biggest seller this year. However, he does not
believe the hacked version will have a great effect on sales, since it
will be limited to black market channels. 

Games are routinely pirated after their release anyway, he said.

The original Half-Life game, released in 1998, and its spin-off
Counter-Strike are still some of the most played action games online.
*******************************
Mercury News
Posted on Wed, Oct. 08, 2003
Student skirts CD's piracy guard
SOFTWARE COMPANY SAYS IT KNEW OF `SHIFT' TRICK
By Elise Ackerman

A Princeton University student has found he can defeat a highly touted
computer program to prevent music piracy with the stroke of a single key:
``Shift.''

In a paper posted on his Web site Monday, graduate student John
Halderman, 22, said he got around restrictions built into the CD ``Comin'
>From Where I'm From,'' by Anthony Hamilton, a soulful R&B artist. The
CD, released by BMG's Arista Records last month, was heavily promoted as
the first to use copy-management technology. Software included on the CD
limited consumers to burning only three regular copies or to sending
promotional copies that timed out after 10 days.

But Halderman managed to stop the software from installing itself on his
PC.

``In practice, many users who try to copy the disc will succeed without
even noticing that it's protected, and all others can bypass the
protections with as little as a single key stroke,'' he wrote.

Nathaniel Brown, a BMG spokesman, admitted the restrictions could be
bypassed by a determined consumer. But he likened the software, made by
SunnComm Technologies, to a ``speed bump'' that would deter ordinary
consumers from casually making multiple illegal copies.

``It's not going to stop a hacker or someone who wants to mass-copy,'' he
said.

Brown said the company chose to use the technology anyway because it
``offers a new level of playability'' -- which means consumers can now
play the CD in their cars.

Lawsuits filed

BMG, a Bertelsmann subsidiary, and other music companies have sought to
discourage mass copying by taking 261 people to court last month for
sharing songs without permission and threatening other 
lawsuits.

SunnComm said Halderman made circumventing its software sound too easy,
and that the company already knew about the loophole. Halderman's paper
could be considered a violation of the Digital Millennium Copyright Act,
a controversial law which prohibits making devices that circumvent
copy-prevention measures, said Peter Jacobs, president of the Phoenix
company.

``I don't see how telling people to press the shift key can be a
circumventive device,'' said Halderman in an interview.

`Hall of fame'

``This technology is going to end up in the hall of fame beside the
previous Sony technology that was famously defeated by drawing on the CD
with a felt-tipped pen,'' wrote Edward Felton, Halderman's adviser, who
publishes a Weblog, ``Freedom to Tinker.'' A Princeton professor, Felton
was threatened by the Recording Industry Association of America in 2001
when he sought to publish research on vulnerabilities in digital
watermarking technology.

Jacobs said he had no intention of suing Halderman under the copyright
act, and that the student should spend his time researching something
more worthwhile. He said, ``This just isn't one of the weighty issues of
the world.''
*******************************
Government Computer News
OMB officially names Haycock chief architect 
By Jason Miller 

The Office of Management and Budget earlier this week officially hired
Bob Haycock as its first chief architect. 

Haycock, whose first formal day in the position will be Oct. 20, has been
on detail to OMB as chief architect from the Interior Department?s Bureau
of Land Management since June 2002. 

?My job will not change other than working for Karen directly,? Haycock
said, referring to Karen Evans, OMB administrator for E-government and
IT. 

Haycock will take on some of former OMB chief technology officer Norm
Lorentz?s responsibilities, ?but I haven?t had the chance yet to talk
with Karen at length about the changes,? he said. ?I know will continue
to do a lot of the technical stuff, and I will not be doing any of the
political stuff.? 

His continuing responsibilities include running the Federal Enterprise
Architecture Program Management Office, developing and implementing the
first iteration of the Federal Enterprise Architecture and working with
the CIO Council to integrate the federal blueprint with agency
architectures, he said. 

One of Haycock?s first goals is to finish the Data Performance Reference
Modelthe final piece to the Federal Enterprise Architecture. He said the
model should be released to agencies for formal comment in a couple of
months. 

Haycock also will oversee entering data into the Federal Enterprise
Architecture Management Systemwhich agencies will use to find
opportunities for collaboration along similar business
functionsintegrating state and local governments architectures with the
federal blueprint and determining how to better incorporate security into
the architecture models. 

He also will have to wait and see whether Congress funds the
administration?s $2.5 million request to support the program management
office efforts.
*******************************
Government Executive
October 7, 2003 
Homeland Security ready to start ordering technology 
By David J. Wallace, National Journal's Technology Daily 



CAMBRIDGE, Mass.The Homeland Security Department is finally "open
for business" for companies offering innovative protective systems,
an industry executive said Tuesday. 

Thousands of vendors have given up hope of landing federal security
contracts after two years of waiting for the department to hire staff,
announce programs or standards, and increase budgets, Edmond Woollen,
vice president of Raytheon of Waltham, Mass., told a conference for
Massachusetts companies weighing federal sales. But the window of
opportunity is finally here. 

Woollen said he believes Homeland Security has the quickest response of
any government buyer. But he cautioned companies to be prudent and think
long term in pursuit of both independent sales and collaborating with
larger "system engineers" or integrators such as Lockheed
Martin, Raytheon or IBM. 

The department is seeking "evolutionary and revolutionary"
technologies that show quantitative improvements in safety, not just
change, said Charles McQueary, Homeland Security's undersecretary for
science and technology. 

Of the department's projected $37.6 billion budget for fiscal 2004, $900
million is earmarked for science and technology, including $198 million
to prevent biological attacks, McQueary said. About 400 bidders appeared
last week at the first meeting for vendors of systems for detecting
chemical and biological weapons, he added. 

An estimated 85 percent to 90 percent of the $900 million will be devoted
to near-term solutions instead of long-term research, McQueary said,
describing a two-year schedule in which suppliers move quickly from
prototype to installation. Longer-range research still will be done by
other defense-oriented labs or companies, but may be funded by Defense
Department grants or other agencies, he said. 

"We need to do things, and it's my view that if we were to have a
science and technology division that was looking five or six years out,
in that time we'd become irrelevant to the department," he said.
"I'm looking for companies, university labs and others that have
solutions todaythings that are relevant to make an impact on overall
homeland security." 

McQueary cited the upcoming Oct. 15 release of standards for a $60
million program to protect commercial aircraft from ground attacks. He
said it is more complex to equip passenger planes and meet other federal
standards from the Federal Aviation Administration, for example, than
supplying a contract under military specifications. 

With technical standards emerging and budgets growing to fund
anti-terrorism, cybersecurity and transportation infrastructure projects,
companies are aggressively pursuing business in Washington. 

Such contracts often are low-profit-margin sales that can take several
years to materialize, said Arthur Coviello, chief executive of Bedford,
Mass.-based RSA Security, which provides digital certificates and other
encryption tools. But he estimates that 10 percent to 15 percent of RSA's
sales are to government. 

"Once you're on a contract," he said, "the repeat business
and the lower costs of selling makes it a worthwhile endeavor."
*******************************
Computerworld
DHS adopts biometrics for border control
Large-scale deployments signal growing trend 
Story by Dan Verton 

OCTOBER 07, 2003 ( COMPUTERWORLD ) - WASHINGTON -- The U.S. Department of
Homeland Security during the past week has jump-started an aggressive
biometric deployment program to help fill gaps in the U.S. border
security perimeter. 

The DHS today announced a $3.5 million deal with Fairfax, Va.-based
Information Spectrum Inc. (ISI), a wholly owned subsidiary of Anteon
International Corp., for 1,000 optical-stripe read/write drives and
biometric verification systems for the U.S. Visitor and Immigration
Status Indication Technology, or U.S. VISIT, program. The contract comes
on the heels of an Oct. 3 announcement by the department that it had
signed what's being described as one of the largest contracts in history
for biometric fingerprint-scanning technologies with Minnetonka,
Minn.-based Identix Corp. 

Mark Heilman, executive vice president of corporate development at
Anteon, said biometric technology has come a long way over the past
several years, but "the jury is still out" in terms of its
ability to handle a challenge as large and complex as homeland security.
"There are a number of technologies out there, and I think DHS is
still looking for the right mix," Heilman said. "I think there
will be some choices made during the next year or so that will shake out
the industry." 

However, the important aspect of his company's recent contract with DHS,
Heilman said, is that it doesn't necessarily represent a commitment to
fingerprint technology. "The optical card doesn't limit them to
using only fingerprint biometric identifiers," he said. "You
could certainly store an iris scan on the card." 

The ISI optical drives and biometric verification software will be
deployed to ports of entry around the U.S. for operation on existing DHS
computer systems. The software will enable border-crossing agents to read
the encoded data on any of the more than 13 million permanent-resident
and border-crossing cards issued by the U.S. government, authenticate the
biometric data stored on the cards and alert DHS inspectors to the
presence of possible counterfeit cards. 

Meanwhile, through a five-year blanket purchase agreement that could be
worth up to $27 million, the DHS last week said it will begin deploying
Identix's TouchPrint 3000 live-scan fingerprint booking stations and
desktop systems to support the Citizenship and Immigration Services (CIS)
program as well as other departments within the DHS. 

The CIS program will use the Identix fingerprint-scanning systems to
digitally capture and electronically submit fingerprint images from
immigration applicants to the FBI. The fingerprints will then be used to
conduct criminal background checks on the applicants before the CIS
decides whether to grant immigration benefits. Live-scan systems are
currently deployed at more than 130 CIS application support centers
throughout the U.S., including the territories of Guam, the Virgin
Islands and Puerto Rico. Other DHS bureaus, including the Bureau of
Immigration and Customs Enforcement and the Bureau of Customs and Border
Protection, also use Identix live-scan technology at ports of entry and
border-control points. 

Frances Zelazny, a spokeswoman for Identix, said the Immigration and
Naturalization Service has been using Identix live-scan systems for at
least five years to conduct criminal background checks on people who
apply for immigrant and asylum status in the U.S. 

Zelazny added that the DHS today has already issued its first order under
the contract totaling more than $2 million and has announced plans to
extend the contract to its overseas screening operations.
*******************************
CNET News.com
P2P group seeks cross-industry detente
Last modified: October 8, 2003, 6:56 AM PDT
By John Borland 
Staff Writer, CNET News.com

At an open meeting Wednesday of a peer-to-peer forum backed by the parent
company of Kazaa, the discussion will turn to a seemingly improbable
concept: how to eliminate piracy from file-swapping networks. 

But in their bid to win respectability--as well as economic and legal
breathing room--that's just what Distributed Computing Industry Alliance
(DCIA) founding members Sharman Networks and the affiliated Altnet say
they're seeking: At the group's meeting they'll unveil a plan they say
can turn the millions of monthly music downloads on networks such as
Sharman's Kazaa into cash for artists and record companies. 

Evoking shades of Napster's five-year, $1 billion offer to the record
labels in 2001, the plan foresees online revenue of $900 million a month
for record labels--as long as everyone puts past grievances behind them
and agrees to work together on a plan for turning file-swapping networks
into cash cows. 

"The goal is to begin a real discussion focusing on robust business
models that have a depth of technical and practical specificity that
makes them credible," said DCIA Chief Executive Officer Marty
Lafferty. 

The effort to establish file-swapping companies as legitimate businesses
is picking up in Washington, D.C., but with mixed results. 

Another trade association dubbed P2P United, which includes a larger
group of companies including Streamcast Networks, LimeWire and Grokster,
has begun actively lobbying Congress on issues affecting its members and
other Internet companies. 

The DCIA, by contrast, isn't explicitly a lobbying group. It was formed
to create a forum where content, telecommunications and file-swapping
companies could hash out and agree on a plan that would allow services
such as Kazaa to exist while soothing content-companies' fears about
losing online revenue. 

That's a steep hill to climb, as other companies have found, and as the
DCIA knows. As yet, the "Alliance" portion of its title remains
somewhat theoretical because the group doesn't divulge its members. Not
one of the big five major record companies is on board, something that
will have to happen if any plan is to be universally accepted. The DCIA
says it's in discussions on that matter. 

Moreover, the plan being submitted Wednesday bears the clear fingerprints
of Altnet and Sharman, which have outlined similar proposals in federal
securities regulatory filings and in legal briefs that charge the record
industry with antitrust violations. Lafferty said other plans will be
submitted to the group in coming weeks, with an eye toward producing an
open discussion. 

The plan's outlines are ambitious and would require a cease-fire among
parties that are now bitter enemies. 

A plan, in stages
In a first stage, music companies would let their songs be distributed on
file-sharing networks such as Kazaa, but wrapped in
digital-rights-management tools that would require listeners to pay to
unwrap them. This is roughly the business plan for a joint venture
between Altnet and Sharman, but Lafferty said the technology could be
handled by anyone, not just those companies. 

The plan doesn't involve blocking unauthorized versions of songs from the
network, something that the Recording Industry Association of America
(RIAA) has repeatedly suggested. Seeding search results with authorized
versions will be enough to reduce much of the piracy now going on, the
plans' authors predict. 

A second stage would let billing for these encryption-wrapped songs be
handled though more familiar means, such as though a telephone number.

Finally, file-identification systems, such as those now being developed
by Audible Magic, would be installed in Internet service providers. When
songs are downloaded, they would be identified by this file watcher, and
swappers would be billed through their Internet service provider, the
proposal will suggest. 

By the end of 3 years--assuming everybody involved voluntarily allows the
entire project to happen--the record industry could be making $900
million a month from downloads, Lafferty said. 

But bringing everyone on board will be difficult. Sharman is still the
target of lawsuits from the recording industry, and it has filed its own
countersuit against the record companies. The file-swappping companies
affiliated with P2P United say they're deeply suspicious of the DCIA's
Altnet-centric proposals, although they say they are looking for comprise
too. 

"It is premature for anyone to claim that they have the solution to
the conundrum of how best to enable a marketplace for tomorrow,"
said Adam Eisgrau, a longtime lobbyist representing P2P United. "We
believe that ideally the parties can come to a table and work something
out. But failing that we think Congress should compel parties to come to
a table." 

Lafferty says he recognizes that today's meeting is just the early stages
of a long and difficult attempt to bring respectability to file swapping.

"We're doing everything we can to earn (everybody's) trust," he
said. "It's quite a bit to overcome. We are a peace table, but no
one's declared a truce." 
*******************************