Proposed Telecom Bill Would Hinder Americans

Michael Weisman is a Seattle attorney and expert in telecommunication law and policy. He is a policy adviser to Reclaim the Media and other public-interest groups ...

Here is his opinion of pending legislation before the American Senate:

The new telecommunications bill before Sen. Ted Stevens' Senate Commerce Committee this week has been touted as reform of the cable-franchise laws. But it is much, much more. The bill is really a wholesale rewrite of the Telecommunications Act of 1934, the world's oldest existing telecom law. It is probably the most important piece of legislation the Congress will take up this session.

Living in the Silicon Forest, we've come to take certain things for granted. Our tech startups and venture-capital firms have learned to assume that Internet and telecom networks will be a platform for innovation open to anyone who can pay the freight for success. Workers have come to rely on fast and plentiful Internet access open to any type of device or application. Major retailers like Amazon, REI, Powell's Books and PC Connections have come to rely on the Internet as a route into the living rooms of customers all over the world.

Under Stevens' bill, all that will change. The telecoms will be able to split Internet access into premium lanes, segregating access to customers based on the content, origin and purpose of the data or bits. Amazon will have to pay the network operator for access to customers, finally legitimating the dream of telecom executives to tax the eyeblinks of every user. Apple will have to pay the networks to allow its customers to download iTunes music and video. If it chooses, the network can simply block iTunes music or Amazon book purchases, redirecting customers to another service the network operator prefers. In fact, there is no guarantee that Internet access, as we know it today, will continue to exist at all.

The thousands of startup visionaries living in the Northwest might want to find their passports, because creating new business models in the U.S. will become much more complicated, and expensive. In the rest of the developed world, it won't be a problem, because every developed country has a strong network-neutrality law in place, extending not just to the Internet, but also to mobile networks, cable TV and television. Stevens' bill puts the U.S. out of step with the rest of world, a world that is fast passing us in productivity, the knowledge economy and broadband connectivity.

The telecom and cable duopoly argues that it's necessary to impose a monopoly business model on the Internet in order to generate enough profits to upgrade the existing infrastructure and roll out new advanced services to the public. To date, the U.S. government has provided more than $200 billion to these companies as an incentive to upgrade their networks to the international norm.

We haven't seen much in return for this "free lunch." The duopoly enjoys below-market rates for tunneling under the sidewalks and streets, or hanging its wires in front of views. Still, the public has seen no competition to speak of, and the network operators shut out the many thousands of companies that tried to provide competition in the past 10 years.

The purpose of Stevens' bill is not to bring competition in cable TV or the Internet. There has never been any barrier to local competition, except the desire to compete. The purpose of the bill is to roll back the middling efforts at competition that Congress has enacted over the past two decades.

Leaders of the telecom and cable duopoly tell us to trust them, because this time they really mean it, competition and advanced services will come ... in 10 to 12 years. After all, their Astroturf Web sites and push polling tell us, you can't trust the government, so you are left with the cable and phone companies as your only friends. This means we're in big trouble.

The telecom and cable duopoly will find its respective monopolies enshrined in the law, with no obligation to play fairly with new entrants to the market (there can't be any under Stevens' bill), no requirement to carry traffic for "freeloaders" like YouTube, iTunes, Amazon, Real Networks or MSN, and no fear of future entrepreneurs like Jeff Bezos, Sergey Brin or Craig McCaw horning in on the action.

Local franchising is only a small piece of this bill, and, yes, it needs reform. But it is dead wrong to claim that local franchising authorities have stifled competition. Any company that wishes to enter any community may do so at any time, and that has been the law for decades.

It would be a waste of valuable ink to reiterate the virtues of a free and open Internet. They are demonstrated every day in the pages of this newspaper, and in its excellent Web site and online news services. But we stand a very good chance of seeing these important democratic tools disappear, or at least be far less effective than the alternative.

The alternative is real. Every other major developed country has strong network-neutrality laws in place, far stronger than anything the Congress is considering in any of the many amendments to Stevens' bill.

Because these countries have strong laws, keeping the networks open to competition and free for any budding startup to use, they have far surpassed the U.S. on the information highway. They have faster networks, lower fees and more-advanced services like IPTV, distance learning, and remote medical and security monitoring. Their networks are more reliable and secure, because reliability, security and speed are built in.

While not as tangibly exciting as the space race, or with the threatening specter of Sputnik circling overhead, our national efforts to move into a 21st-century knowledge economy are every bit as important. This is a race we do not want to lose; it is a race we cannot afford to lose.

How to Invest Like a Millionaire and Win

Taking tips from the growing ranks of the super rich can be a good way to spot tomorrow’s dead certs, says Kathryn Cooper of London's Sunday Times ...

Nearly 450,000 British investors are now ranked among the world’s wealthy elite, according to a survey out last week, and they have been ploughing their growing capital into exotic investments such as unlisted firms, fine art and commodities.

The number of people in Britain with assets, excluding their homes, worth more than $1m (£550,000) leapt by 7% last year to 448,070, according to the World Wealth Report by Merrill Lynch, the investment bank, and Cap Gemini, the consultant.

Wealthy investors, also known in the trade as “high net worth individuals”, are closely watched by the industry because they often latch on to trends before the rest of us. One reason is that their money buys them direct access to better, tailor-made, advice.

The super rich poured their spare cash into the secret world of private-equity funds last year and were rewarded with a return of 37.2%, compared with 21.8% from the FTSE All-Share, according to the British Venture Capital Association.

Private-equity funds, which provide finance for firms that are not listed on the stock market or are being taken private, have also been a strong bet over the past decade. They have returned 21% a year over three years, 11.9% over five and 16.4% over 10, compared with annual returns of 18.5%, 2.4% and 8% for quoted UK stocks.

Some of the best-known names in British business are in private hands, including retailers such as Topshop, the fashion chain owned by Sir Philip Green, and New Look. Debenhams, the department-store group, is back on the stock market after two years in the hands of private-equity managers.

Top private-equity funds such as Apax and Permira used to require a minimum investment of $25m, which kept them as the preserve of the institutions, but you can now get in for about $100,000, according to Merrill Lynch. Wealthy individuals have therefore piled in, investing a total of $174 billion last year, up 314% on 2004.

The boom has also been fuelled by generous tax breaks. If you invest directly in a private firm under Britain’s enterprise-investment scheme, you could qualify for tax relief of 20% on up to £400,000. In other words, you could get a handout of up to £80,000 from Gordon Brown.

Unlisted firms have even taken over from hedge funds as the favourite alternative investment of the super rich, according to the Wealth Report.

Hedge funds use complex techniques to make money in falling as well as rising markets, but they have failed to live up to expectations in recent months. They returned only 7.1% in 2005, compared with an average gain of 29% in world markets, and their performance has been equally disappointing in the recent downturn.

The typical fund of hedge funds has dropped 3.42% since the market started to fall in May, according to figures from Bestinvest, an adviser. While the Footsie has performed worse with a fall of 6.8%, many hedge-fund investors will have been hoping for positive returns.

Nick Tucker of Merrill Lynch said: “Interest in hedge funds has cooled because of lower returns, higher fees and tighter government regulation. Private-equity funds, which have been a higher-yielding alternative, have gained in popularity.”

While private equity has been a good long-term bet, advisers would caution against piling in now because much of the easy money has already been made.

Jonathan Bell of Stanhope Capital, a wealth manager, said: “We are big fans of private equity in the long term, but at present are sceptical of the returns that will be achieved, given the scale of money being raised by the industry.”

Wealthy investors have not turned their backs on quoted firms completely. They are preparing to dip a toe back into the stock market, having pulled out in favour of cash ahead of May’s downturn.

Tucker said: “Wealthy clients raised cash in March and April, so they have been feeling relatively relaxed in the downturn. They have been watching the market closely, though, and think it is starting to offer better value. Some emerging markets are down by as much as 30% to 35%, and clients are beginning to say it is time to get back in.”

Fine art has been another big beneficiary of last year’s boom in Britain’s wealth, with record prices being set at Sotheby’s and Christie’s almost weekly.

One of David Hockney’s paintings was recently sold for a record £2.9m, for example. Again, however, the easy money may have been made.

Wealthy investors are also cooling on commercial property, which includes shops, offices and warehouses and was one of the hottest sectors in this year’s Isa season. However, returns are expected to run out of steam as interest rates go up.

The sector produced a return of 19.1% in 2005, but this is expected to slow to 8.6% this year and 6.9% in 2007 — still respectable, but much lower than previously.

The super rich are therefore looking for even more exotic ways to beat the market — and one of the latest buzz words is infrastructure investment. This is where investors back joint ventures between the public and private sectors to build hospitals, schools and transport links.

HSBC recently listed the first UK infrastructure investment on the London Stock Exchange, pension funds are getting in on the act and wealthy investors are expected to follow suit.

The super rich do not always get it right, though. Bell said: “High net worth investors are just as fallible as everyone else. At the bottom of the bear market in 2003, when shares offered the best potential returns, they were focused on preserving their wealth and had relatively small holdings in equities.”

YouTube Is Hot

Michelle Quinn of Knight Ridder Newspapers reports on the trendiest of the trendy in cybersites ...

SAN JOSE, Calif. — Allen Ng's YouTube habit is eating into his TV habit.

Every chance he gets, the 14-year-old from Fremont, Calif., checks the web site YouTube to watch short videos of badminton clips, excerpts of Chinese movies and funny, amateur productions made and posted by strangers from around the world. At school, the buzz among Allen's friends isn't about TV but about quirky YouTube videos — like the Norwegian man recently performing as a human sound-effects machine.

"I go to YouTube when I get bored," Allen said.

YouTube and other video-sharing Web sites signal a shift in the way entertainment will be made and consumed in the future. They're creating a new form of television that's at once personal, grass-roots and unfettered.

With the emergence of technology for easily sharing video over the Internet, viewers are gaining the autonomy to choose what, when and where they watch — be it on an iPod, laptop or desktop computer. And the masses are getting an opportunity to create and experiment with video while bypassing the central filter of a TV network.

No company epitomizes these rapid changes more than YouTube. In the past six months, YouTube, a 27-employee company housed above a pizzeria in San Mateo, Calif., has become a new global stage. Visitors to the site view more than 50 million videos a day, mostly made by amateurs. Its audience has mushroomed to 12.5 million a month, making it the chief place people go online to watch video. It has become one of the 50 most visited Web sites overall.

Many YouTube videos are forgettable — traffic mishaps, lonely teenagers, babies crawling, skateboard tricks. Some are blurry or shaky. Virtually all are short clips, lasting one to two minutes. Some are copyrighted, lifted right off the TV. But there's also a lot of original talent on display.

"What really motivates people is being seen and getting a response," said Chad Hurley, 29, a YouTube co-founder and chief executive, who shakes his blond hair out of his face when he talks.

Confident of success

For the co-founder of a company that has come out of nowhere fast, Hurley is surprisingly confident about YouTube's prospects. He is quintessential Silicon Valley, earnest about how technology can change the world but vague (perhaps purposely so) about how it will make money. "We are just trying to help people find an easy way to share their experiences," he said.

But other companies such as technology giants Microsoft, Google and Yahoo! are offering online video too. Smaller players too, such as Revver, Grouper and iFilm, are competing with YouTube for interesting content. MySpace, the social-networking Web site popular among teens, has ramped up its video-sharing features online, which may eat into YouTube's market.

Indeed, Web sites such as YouTube, whose motto is "Broadcast Yourself," have a long way to go before killing off the boob tube.

In a recent survey for the Online Publishers Association, 24 percent of Internet users said they watched online video at least once a week and only 5 percent watched it daily.

The average person watches four hours and 52 minutes of TV a day, according to Nielsen Media Research. On average, each YouTube visitor spends nearly 16 minutes on the site, according to Hitwise, an online measurement firm in New York.

For now, YouTube is a pastime mostly for the young. Thirty-one percent of its visitors are 18 to 24, according to Hitwise. And that is probably the age range of most of YouTube's budding video makers.

Online video is nothing new. But over the past year, the spread of fast Internet connections, easy-to-use editing software and cheap camcorders and camera phones have turned it into a mass phenomenon.

Rising stars

Videos of current events, such as the July 2005 terrorist blasts in London and Hurricane Katrina were e-mailed around the world instantly, sometimes making it onto network news.

"People don't want to be the next Spielberg, but they want to express themselves," said J.D. Lasica, executive director of Ourmedia, a not-for-profit Web site for videos and other content.

YouTube's beginnings are classic Silicon Valley. Co-founders Hurley, who studied art and graphic design in college, and Steve Chen, an engineer, met in 1999 while working at PayPal, the online-payment service now owned by eBay. They attended a party in January 2005 where someone made a video. But they couldn't find an easy way to share the video online.

They began to develop technology that makes it easy to post and watch videos online, no matter what camera or computer is used. And without downloading software.

The site officially launched in December, with financial backing from Sequoia Capital, the venture-capital firm that also backed Google. Since then, Hurley and Chen have been on the "Today" show, ABC's "Nightline," and CNN and CNBC.

Surprising evolution

Chen, 27, who is YouTube's chief technology officer, still seems shocked by how the Web site has evolved from the days when he put up videos of his cats to give people an idea of what they can do with YouTube. "It's almost like a challenge now among users to produce more entertaining content," said Chen.

The co-founders say they don't want to become the new TV or supplant the Hollywood machinery. They plan to make money from advertising on the site as well as cross-promotional arrangements with movie studios, record companies and others.

This new world of entertainment has already created powerful players. At YouTube, that's Kevin Donahue, vice president of programming. Besides meeting with entertainment companies about how they can use YouTube, he is also the person who picks videos featured on YouTube's home page. He can turn an obscure video clip into an overnight sensation.

Recently, Donahue chose a video by a Stanford University freshman who filmed President Bush's April visit to Stanford, and shot part of it while sitting in a tree. Since then, the video has received more than 70,000 viewers and 2,100 comments.

"Anyone can be a reporter and share something happening in their life," said Craig, 18, who didn't want his last name used for this story.

It's unclear whether YouTube will retain its populist identity or become a big commercial company with scant room for the little guy. For now, YouTube revels in giving a stage to legions of amateur videographers. Said Hurley: "We are enjoying having a chance to experience things through other people's eyes."

Will Privilege Prevail in a Two-Tier Web?

Kristi Heim of the Seattle Times reports on the possibility of an earth-shaking development in cyberspace access ...

On some highways, drivers pay for access to lanes that let them move faster than ordinary traffic. Will that same concept work on the virtual highway?

As the Internet becomes the conduit for more traffic, especially the heavy demands of transporting music and video, that question has become central to the debate over how to pay for its expansion and set new rules of the road.

The U.S. Senate Commerce Committee is nearing a vote today on a sweeping telecommunications bill, but one issue under consideration — so-called "network neutrality" — is causing sharp divisions. The technology-centric Seattle area has much at stake in its outcome.

Telecommunications companies such as AT&T, Qwest, Verizon Communications and Comcast want to be able to charge different fees to Internet content providers for different levels of service on their networks. Google, Amazon.com, Microsoft and other content companies favor rules that would require neutral treatment, barring telecom companies from charging them fees for priority delivery of Internet traffic.

Consumer groups have criticized the current bill and called for net neutrality, saying blocking or slowing access to some Internet content would result in fewer choices and higher prices.

In Seattle, the city's ambitious initiative for high-speed access calls for partners to build a fiber-optic network with connections to homes and offices, and network neutrality is an essential element of its approach.

"Without net-neutrality guarantees, the Internet as we know it will cease to exist," said Tony Perez, director of Seattle's Office of Broadband Communications. "The cable and phone duopoly will begin to architect their networks to discriminate among application and content providers and possibly favor their own content and applications."

In Kirkland and Snohomish County, however, Verizon is already building a fiber-optic network and says it has a right to charge extra for the new high speeds and greater capacity it can deliver.

"We're making a major investment here, and if Google or AOL or someone else wants to be able to have it guaranteed at some level of speed, our question is what is the problem of charging for allowing them to be able to access our customer base in that way?" said Verizon spokesman Kevin Laverty. "We're certainly not denying anybody access to the Internet."

A two-tiered system would change the way the Internet works today. As it is now, Internet content itself isn't handled differently based on relationships its owner — for example, Amazon — has with an access provider. Under a two-tiered system, if one online bookstore paid for premium service, for example, its pages would be delivered faster than others, giving it a competitive advantage.

Although not an ideal outcome, prohibiting a tiered system would not change Verizon's plans for the network buildout, Laverty said.

US has fallen behind

The need to build more robust networks and decide how best to run them comes at a time when the United States has fallen behind countries in Europe and Asia. Broadband service in the U.S. is slower and more expensive than in places like France, South Korea and Japan. The telecommunications bill, called the Communications, Consumers' Choice, and Broadband Deployment Act of 2006, had about 200 amendments filed by Wednesday. Addressing digital television, municipal broadband and a host of other issues, it represents the most massive overhaul of telecom policy since 1996.

Commerce Committee Chairman Ted Stevens, R-Alaska, has not indicated which amendments he will entertain during today's debate and vote in his committee. But if the bill passes his committee, it will then go to the full Senate. Phone, cable and high-tech companies have spent several million dollars in lobbying on this legislation since last fall.

A network-neutrality bill co-sponsored by Rep. Jay Inslee, D-Bainbridge Island, failed in the House of Representatives earlier this month. Amendments being proposed in the Senate have similar language, including one by Sens. Olympia Snowe, R-Maine, and Byron Dorgan, D-N.D., that Sen. Maria Cantwell, D-Wash., says she is supporting.

She signed on to the Snowe-Dorgan amendment Tuesday. Cantwell, a member of the Commerce Committee and high-tech industry veteran, has been criticized for not taking a stand on the issue earlier.

"Where is Maria Cantwell?" asked Art Brodksy, communications director of Public Knowledge, a public-interest group for technology policy. Cantwell was not present at the committee's three main hearings on the bill in May and June, including the May 25 meeting on net neutrality, said Brodsky.

Cantwell said she has worked through Sen. Daniel Inouye, D-Hawaii, the ranking Democrat on the committee. "We were hoping these guys [Stevens and Inouye] would come up with language that would be good," she said. "We kept hearing that these guys understood the issue."

The sheer number of amendments pending "shows the level of controversy about the bill," she said. "We have a proposal that's got a lot of holes in it."

Cantwell said getting a net-neutrality provision into the bill is important.

"We don't want to pass language that gives someone the impression you can ... arbitrarily take content and start charging for those services," she said. "I think it impacts the way the Internet operates as a free and open system today."

"No speed limit"

Verizon and other companies support the current bill and are eager to push ahead. Verizon is spending tens of millions of dollars this year to roll out its fiber network to at least 60,000 homes in Kirkland, Redmond, Bothell, Kenmore and Snohomish County. It's part of an estimated $20 billion plan to provide fiber-optic service to homes nationwide, using the network initially for voice and data, and as a video alternative to cable TV in the future.

"If Verizon charges Google or AOL [more] for delivering their services at a highly predictable rate of speed — maybe faster than Papa John's Pizza's Web site — it's so that these companies can take advantage of the physical network we are building, which has virtually no speed limit," Laverty said, adding that speed and capacity can be easily adjusted without adding cost to consumers.

If priority lanes would be fast, others necessarily would be slower, content providers argue. Worse still is the possibility that telecom gatekeepers would block access to competing sites.

"It's like the Tony Soprano of net transport," said Perez. "Pay us so we can ensure your bits get preferential treatment."

Unfair competition?

So far, the debate has mostly been between industry giants, though groups such as musicians and evangelical Christians have weighed in favoring neutrality. Some small-business owners, meanwhile, worry they will get lost in the shuffle.

Seattle-based BillMonk is a growing Internet startup with a shoestring budget offering a shared bill-paying service. Having to pay broadband providers fees to guarantee higher-quality service would hurt BillMonk, said co-founder and Amazon.com veteran Chuck Groom. In addition to raising costs and taking up valuable time to negotiate agreements, a tiered system would introduce unfair competition.

"A large company could oust BillMonk from the market simply by purchasing a much faster connection to the end-user," Groom said.

Added co-founder Gaurav Oberoi: "It would make it much harder to enter the playing field if we had to start competing with giants who could pay for delivery." He gave the example of YouTube, a video-sharing Web site started by two entrepreneurs that became an instant success.

"Would they have gotten as big had the network not been neutral?" he asked. "How would they have been able to compete with Google?"

The Spyware Doctor Has the Best Prescriptions for Your PC

Craig Crossman of the Knight Ridder Newspaper chain reports on the state-of-the-art for PC housecalls ...

It used to be that the worst thing you could catch from going online was a computer virus. Computer anti-virus products have been around for so long now that it's pretty much standard to have one before venturing out onto the Internet.

But today, there's so much bad stuff out there just waiting to find your poor little computer, having only an anti-virus program is tantamount to venturing out into the Amazonian jungle with just a can of insect repellent.

One of the biggest threats to going online now is identity theft. No longer do they just want to mess with your computer. They want to mess with you personally. And the best way to do that is to steal anything and everything that makes you who you are.

Unfortunately, so much of that personal data can be found on, or accessed through, your personal computer.

Fortunately, there's some very good protection available to you, such as the product from PC Tools Software called Spyware Doctor.

If you had to classify Spyware Doctor, it would be called anti-spyware. Spyware comes in all kinds of shapes and forms, and Spyware Doctor keeps up with the best of them.

Constant updates

As with computer viruses, new types of spyware are constantly being devised, and Spyware Doctor is constantly being updated.

Unlike most anti-spyware products that detect something after you are infected, Spyware Doctor is also a preventive move. It blocks as well as detects and removes all types of spyware.

For example, just browsing on a Web site can infect your computer with spyware. With Spyware Doctor, you will be warned that the Web site you are about to view is trying to install something bad and it will prevent you from being infected right there.

Spyware Doctor has anti-phishing built in. Ever get one of those e-mails that claims your password on PayPal or eBay is about to expire? It's a thief trying to steal your private information. Spyware Doctor won't let you go to that Web site in the e-mail and will alert you to the impending disaster.

Spyware Doctor is also capable of catching keyloggers. These are little programs that have been surreptitiously planted on your computer.

Their purpose is to capture every keystroke you make. When it gets enough of them, the keylogger will transmit every keystroke you made to the pirate's location, which can be really nasty. But you can feel safe with Spyware Doctor watching every move the bad guys try to make against you.

List keeps growing

If you want a list of just about everything Spyware Doctor protects against, that would be spyware, adware, spyware/Trojans, keyloggers, identity theft, hijackers, tracking threats, rogue anti-spyware, unwanted software, phishing, pop-ups and bad Web sites. The defensive list keeps growing because the list of bad things keeps growing.

Installation of Spyware Doctor is a breeze, and its OnGuard technology only alerts you to a true spyware detection. Most everything Spyware Doctor does happens in the background so that you can continue your work without any interruptions.

You can try Spyware Doctor for 30 days before making the purchase of $29.95, which includes one year of updates and customer support.

You can download Spyware Doctor from the PC Tools website or purchase the boxed copy at the same price from its Web site as well as technology stores everywhere. An enterprise version is available for large organizations. For Windows only.

Get Air Fare Deals by Forecasting Them

Kim Peterson of The Seattle Times has found a new company which is developing software to help you get a better price on your next flight ...

There are more than enough travel-related sites on the Web, but Farecast hopes to stand out from the rest by actually predicting a rise or fall in airfares.

The Seattle startup, currently testing its technology in a private trial, is combining data mining with a vast library of historical airfare prices.

Put those two together, the company said, and you can actually start to make sense of the seemingly wild fluctuations in plane fares from day to day, even hour to hour.

Farecast expects to open its trial to the public sometime in the summer of 2006. The concept has been solid enough to attract venture funding, $8.5 million in all, and executives are confident it will appeal to consumers flummoxed by airfare pricing.

"There is a need for a sort of Consumer Reports to emerge," said Hugh Crean, president and chief executive. "There's a need for a Kelley Blue Book. What is a fair price?"

For now, Farecast is focusing on plane trips originating from Seattle and Boston, with plans to expand nationally by the end of the year.

Here's how it works: A user picks a date and destination for a plane trip. Farecast gives a list of current airline prices and a prediction about whether those prices will trend up or down over the next week.

When queried Wednesday about a round-trip fare from Seattle to Denver in the first week of June, Farecast said it was more than 80 percent confident the lowest fares would rise by $45.

But for a round trip to Columbus, Ohio, over that same period, Farecast said it was 58 percent sure that fares would drop by $32.

The idea strikes a chord with people who hear about it, Crean said. And no wonder. Consumers are savvy about how to buy tickets online, but are often at a loss when it comes to figuring out when to buy.

Oren Etzioni, a professor of computer science and engineering at the University of Washington, came up with the concept for Farecast years ago while flying from Seattle to Los Angeles to attend his brother's wedding.

During the flight, he started asking passengers how much they paid for airfare. He was dismayed to find some people who had bought a ticket after he did got a better deal.

"It was very frustrating," he said. "I was like, 'Wait a minute. I want to do something about this.'"

Etzioni originally named the project Hamlet, with the unofficial slogan, "To buy or not to buy." The technology belongs to the UW, but the university has licensed it exclusively to Farecast, and Etzioni is on the company's board of directors.

Farecast started in April 2003 and now has 22 full-time employees. The company gets its data from ITA Software, a Massachusetts company that specializes in collecting airfare information, and says it now has 50 billion historical price quotes from routes to study.

Farecast sounds like a company that would make airline executives spitting mad, but Crean said he's received a positive response. That's mainly because Farecast doesn't sell tickets itself; instead, it links directly to airline Web sites.

"It's certainly very strategic for an airline to have a customer go straight to them," Crean said.

Some airlines pay Farecast a fee for the referral, though Crean said he hopes most of the company's revenue will come from ad sales in the future.

Using technology and data mining to make predictions is a hot business, said Matt McIlwain, a managing director at Seattle-based Madrona Venture Group, where Etzioni is a venture partner. Madrona has invested in Farecast. Kirkland-based Inrix, for example, aims to predict traffic patterns so that it can tell drivers about trouble spots.

But Farecast's technology is very difficult, if not impossible, to replicate, and no other company is in the same business, McIlwain said.

"We've all had a Farecast moment where we're sitting there and we're looking at a fare that costs 400 bucks," he said. "Farecast is trying to help the consumer answer a fundamentally different question, which is when to buy, versus the question of what to buy."

Americans Need Customized Cable TV

Senator John McCain says it's time to bring real change to cable television in the USA ...

Here are his comments:

Consumers today have too few choices when it comes to cable television.

In the U.S., if you want ESPN, you must pay for 60-plus channels that you may never watch. If your child loves Nickelodeon, your family must pay for the same 60-plus channels, some of which may not be suitable for young children.

Now, imagine deciding for yourself which TV channels you want to purchase. You could select the channels you want to pay for, or perhaps the ones you no longer want to buy. Right now, TV viewers around the world have these choices. They buy their television channels individually or in smaller bundles -- and get better deals as a result.

Today in our land of opportunity, freedom and choice, there is too little competition, too much regulation and not enough real choice in the cable business. In just the past two years alone, cable prices have increased at twice the rate of inflation. According to the cable companies, it is because they are giving you more and more channels. At no time, however, have the cable companies actually asked if you want those additional channels. They just require you to pay for them.

The solution to high cable bills isn't price controls or additional government regulation. It is more competition in the video marketplace and more consumer choice. For that reason, we encourage Congress to pass the Consumers Having Options in Cable Entertainment Act -- the CHOICE Act -- which would help accelerate the penetration of new cable-service providers in our communities and would encourage the cable industry to offer channels individually or in smaller bundles, what is often called "a la carte." The Government Accountability Office has found that cable rates are 15-percent lower when a community has at least two cable companies competing for consumers.

Additionally, the Federal Communications Commission recently found that consumers could lower their monthly cable bill by as much as 13 percent if they had a la carte programming options. For example, Spanish-speaking homes would never be forced to purchase all the English-language channels before being able to buy the Spanish-language cable channels they actually want. And parents would never be forced to purchase a slew of channels, some not suitable for young children, simply to receive those channels their family enjoys watching together.

Real-world examples illustrate the benefits of greater choice and more competition coming through our TV sets. In Hong Kong, viewers can select and pay for only the channels they want. A family that wants to watch sports, movies, news and children's programming can receive 15 free channels plus a selection of 11 additional digital channels including ESPN, HBO, CNN, Headline News, National Geographic, Animal Planet, and Discovery for only $27.50 per month. To get the same channels in Washington, D.C., it would cost $82 per month. That's quite a difference.

Similarly, in Canada, after buying basic, digital subscribers can buy channels individually or enjoy significant savings on a "5 pack," a "10 pack" or a "15 pack" of their own choosing.

As a result of competition and choice, consumers in Hong Kong are paying less on their cable bills. From 1995 to 2002, Hong Kong's cable bills increased 13 percent. That year, a new video competitor came on the scene with an a la carte option it called "true consumer choice." Since then, the monthly bills for Hong Kong cable customers have fallen by 9 percent. In the U.S., by contrast, cable prices have increased almost 20 percent since 2002 and more than 90 percent since 1995.

The same programmers who oppose selling channels individually or in smaller packages in the U.S. offer their programming a la carte in other countries. Their threats of financial ruin and a loss of diverse programming have proven hollow. The number of viewers in places where consumers have more choice over the channels they buy is booming, and a rich variety of programming remains.

In fact, companies like AT&T, Echostar and Charter want to provide consumers more control over TV programming and enable them to lower their bills, but many programmers will not allow them to do so. And American consumers want these companies to offer such choices. According to a recent AP-Ipsos poll, 78 percent of respondents said they would prefer to choose and pay for their own tailored selection of channels.

Today, cable choice and competition success stories are being written in countries all around the world. Consumers in Hong Kong, the United Kingdom, India and Canada are reaping the rewards of greater choice from channels being offered on an a la carte basis.

So why should cable companies and programmers determine what Americans watch and pay for? We see no reason why the U.S. should be behind so many other countries in giving its people true choice in cable programming.

Republican John McCain is the senior U.S. senator from the state of Arizona. Kevin Martin is the chairman of the Federal Communications Commission.

The Alleged Wonders of Peanut Milk

This could either be an urban legend in the making or the next big wellness trend ...

John M Glionna of the Los Angeles Times introduces us to the possible phenomenon that may be peanut milk:

SAN FRANCISCO -- Jack Chang flashes a crooked smile. His discolored teeth crowd together like old tombstones.

"I know why you come!" the Taiwanese-born cafe owner exclaims to Donna Cooke, one of his most loyal customers. "You want more peanut milk!"

Chang concocted the unlikely beverage when his teeth, loosened by gum disease, drove him to find a painless way to consume peanuts, a favorite food since childhood. The creation had unexpected benefits, Chang says: It cured his gums and even slowed his baldness.

Cooke and other regulars who flock to Chang's KK Cafe swear by peanut milk -- the mystical elixir that Chang invented in the kitchen of his storefront burger joint in this city's bohemian Haight district.

Cooke drinks it for energy and, she says, because it keeps her eyes clear of infection.

"Listen, I'm not crazy," says the Macy's worker. "I know this stuff has made me a healthier woman."

The walls of Chang's eatery carry testimonials affirming the reputed powers of peanut milk. Although there's no hard proof of any health benefits, the beverage has spawned a cult of peanut-milk fanatics.

The drink, which does not contain milk, is made from peanuts, grains, herbs and spices. Fans say it strengthens patients with AIDS and cancer, reverses baldness, heals wounds faster, prevents colds, reduces symptoms of menopause and soothes psoriasis. It's also said to be a hangover cure. Some drink it at bedtime to help them sleep, others as an alternative to caffeine.

Chang, 58, suggests another benefit: "More sexual stamina!"

The diminutive Chang never dreamed his passion for peanuts would lead to a product that is making a minor splash in the holistic foods industry. From a back-shop endeavor that started with a pound of peanuts a day, Chang's company now processes 2,000 pounds a month and ships about 240,000 bottles a year. The 10.5-ounce containers sell for about $1.69.

Backed by investors, he opened a Bay Area production facility in 2004, and his product will soon be sold in Washington, Northern California and Oregon by such high-end stores as Whole Foods.

Chang calls it the Miracle at the KK Cafe. Marketing his peanut milk under the name "Signs and Wonders," a phrase borrowed from the Bible, Chang says the object isn't to make money, but to spread good health. He donates 10 percent of his profits to charity.

Health experts are skeptical of Chang's "miracle," which boasts on its label that it provides "stamina and energy" and "is good for your immune system."

"We live in an age where there is great anxiety about health," said Dr. Rajiv Bhatia of the San Francisco Department of Public Health. "This product, like others, seems to capitalize on that anxiety."

Chang says he's no scientist. He's clueless as to what makes peanut milk work. But he knows it worked for him.

In 1999, a chronic gum condition made Chang's teeth so loose he could no longer eat solid foods. Yet he still craved peanuts. So he decided to brew up a liquid form. Each night after his restaurant closed, he went to work in his kitchen, boiling a bag of peanuts down to mulch, adding grains and other ingredients.

First results disappoint

At first, the results were too oily. Many initial batches tasted terrible. But Chang didn't throw away his failures. He drank them and kept experimenting.

Three months after he started, Chang noticed that his gums no longer hurt. He also stopped losing hair.

"Ha!" he says. "Drink peanut milk! No more hair on pillow!"

The drink has the look and consistency of milk, with a definite peanut twang. Chang didn't plan to sell his invention. But soon cafe denizens began asking about it. Word spread as customers started to report their own claims of astonishing results.

Lawyer Thomas Paoli is drawn to both Chang and his product. "It's food filled with a lot of good feeling," he said. "You go to a restaurant where the chef pours heart and soul into the menu, and you can taste it."

Stories spur customers

In 2002, the story of Chang's peanut milk hit the local media. Not all of the coverage was good. One news anchor tried peanut milk on live television, the cameras rolling as her face curdled.

Still, the stories spurred more customers. Chang stepped up production and worked to improve the taste. "The work was hard," said his son, Jon. "He was killing himself."

That's when Bay Area resident Leo Soong tried the product for his eczema. A devout Christian with a background in the beverage industry, Soong approached the elder Chang, and a company was born.

On the firm's Web site, Soong solicits people who suffer from psoriasis to try the drink and report the results. He hired a scientist to test the product.

"Nutrients in peanuts may help alter the immune system," said Kent Erickson, a biology professor at the University of California, Davis, Medical School. "But I only examined the drink's individual parts. It's a guess as to how the whole thing would work."

Justin Jackson, a regional grocery coordinator for Whole Foods, said if Chang could back customer claims with test results, "peanut milk will really take off."

But fans say they don't need scientific confirmation.

"People don't know how aspirin works," said Reginald Legba, who credits the drink with helping to restore his hair. "I don't know how my car works, but when I get in and turn the key, I know it starts up every time. I also can't explain peanut milk. But every time you need it to work, it works."

A Pill to Control Leukemia

The medical editor for London's Daily Telegraph, Celia Hall, reports on a development that could have an incredible impact on an insidious disease ...

A drug prescribed for one of the commonest forms of leukaemia has reduced the deadly cancer to a chronic illness that can be managed with a single pill a day, specialists said yesterday.

New data issued in London showed that about 90 per cent of patients with chronic myeloid leukaemia (CML) who take the drug Glivec are alive and well after five years.

Before the drug was developed, the blood cancer would become advanced within four to six years, giving little hope of survival.

Specialists described the results as "breathtaking". They said that, unlike some cancer drugs which had shown early promise that then faded, Glivec patients had an "impressively durable resp-onse to the drug."

CML is one of the four most common types of leukaemia. It is a blood cancer in which the white blood cells do not mature and are over-produced.

The condition can lead to tumours forming on the bone marrow or lymph nodes and can also increase the risk of strokes and life-threatening infections.

Patients take the drug for life. In some it is weeks before real benefits can be measured but other patients report feeling better within a few days.

While the drug does not cure the leukaemia, it keeps it under control.

Before Glivec, patients with CML had a life expectancy of four to six years. In the long-term trial only 4.6 per cent of patients died.

The drug costs the health service from £14,000 a year per patient, depending on the strength of the dose, and is recommended for those for whom a bone marrow transplant is not an option.

Pennie Douglas, of CML Support, said her organisation was worried that not all patients had swift access to the drug or that they remained on it.

"We are concerned about people who are not treated at the specialist centres. There are misunderstandings at some hospital departments.

"We have heard that some patients whose test results are good are taken off it. It is a funding issues for many primary care trusts."

About 3,000 people in the country have CML and about 600 a year are newly diagnosed. It usually strikes in middle age.

Glivec is also having good results with a rare cancer of the digestive tract known as gist and is being tried with other cancers, including some that attack the prostate, lungs and brain.

Glivec is designed to stop the cancer cells from multiplying. It works by blocking or inhibiting signals that instruct the cancers cells to divide and grow.

Sufferers normally take one tablet a day for as long as it is shown that they continue to benefit from it.

Users of the drug have reported some mild side-effects, including nausea and sometimes diarrhoea.

It can also cause leg aches and cramp, rashes and swelling of the face, especially around the eyes. Such side-effects are usually treatable.

Charles Craddock, professor of haematology at Birmingham University and the director of the stem cell transplant unit at the city's Queen Elizabeth Hospital, said that results from earlier drug treatments for CML had been "pretty gloomy."

"I am delighted that the remarkable results we initially saw in CML patients treated with Glivec five years ago have continued to improve.

"The significant success of Glivec in treating CML is an exciting model for the development of new treatments for other cancers."

The patient group Gist Support UK welcomed the news.

Dave Cook, a spokesman, said: "The data that we have seen confirm what I have experienced for myself. When six separate gists were removed, I was devastated but after four years on Glivec my scans show no signs of any abnormality. Glivec is a life-saver."

Sandy Craine, 58, from Liverpool, was one of the first people in Britain to take Glivec and formed a support group.

She said: "When it became available five years ago I never believed that I would be standing here today.

"I was told that without invasive chemotherapy following a stem cell transplant I had approximately 12 months to live.

"It has helped save to my life and I am so grateful that I can pass on this message of hope to others diagnosed with this once devastating disease."

Does Keeping a Penny Still Make Sense?

Pricing trends are even rising for metals other than those considered precious ...

It's to the point where organized crime in France has taken to hijacking trucks laden with scrap metal.

Most of us don't need to go lurking after junk wagons, though, if we want to find a pile of appreciating metal. J Scott Orr of the Newhouse News Service explains:

They accumulate everywhere, multiplying faster than bunnies, it seems, in pockets, purses and dresser-top jars. And you can't buy much with them.

So why doesn't the United States get rid of the penny, especially now, when, for the first time, the copper-coated coins cost the government more than 1 cent each to make?

At least one bill has been introduced in Congress to retire the coin, but it never gained traction. And the bottom line may be that when it comes to the penny, Americans don't want change.

"Americans want to keep the penny, it's that simple," said Matthew Eggers, policy director of Americans for Common Cents, which is fighting to keep the coin in circulation.

The most recent survey -- conducted last year by Coinstar, a Bellevue company that puts coin-counting machines in supermarkets and other locations -- found 66 percent of Americans want to keep the penny. It also found 79 percent will stop to pick up a penny.

But the penny's detractors have been buoyed by new figures from the U.S. Mint that show the skyrocketing prices of the two metals used to make the penny -- zinc and copper -- have pushed the cost of making the coin across the 1-cent threshold for the first time, to 1.23 cents. The penny is 97.5 percent zinc and 2.5 percent copper, according to the mint.

Jeff Gore, who heads Citizens for Retiring the Penny, said the mint's figures add to a solid argument for abolition of the nation's oldest form of currency.

The penny is a waste of money and a waste of time, said Gore, who has a doctorate in physics and is doing postdoctoral work at the Massachusetts Institute of Technology.

Using data from Walgreens and the National Association of Convenience Stores that show handling pennies adds 2 to 2 ½ seconds to each transaction, Gore calculated pennies cost each American four hours a year. If each person's hour were worth $15, that's $15 billion lost nationwide annually, according to Gore's formula.

Eliminating the penny, he said, wouldn't cause a ripple because many merchants already round off prices through "give-a-penny, take-a-penny" dishes. Indeed, the United States got rid of the half-cent coin in 1857 without consequence.

Rep. Jim Kolbe, R-Ariz., who sponsored legislation in 2001 to do away with the penny, said he will introduce new anti-penny legislation in light of the new cost figures.

Eggers, of Americans for Common Cents, countered that eliminating the penny would hurt consumers. Without it, transactions would be rounded off to the nearest nickel -- and, he asked, which way do you think most retailers would round prices?

"What you'd see is consumers would be hit with a 'rounding-off tax' of hundreds of millions of dollars in the aggregate every year."

Also feeling the pinch would be charities that raise millions of dollars, one cent at a time, though "penny drive" fundraisers.

Then, there's history.

Some 300 billion pennies in 11 designs have been in circulation since 1787. The design for the first penny was suggested by Benjamin Franklin and some of the copper was supplied by Paul Revere.

Last year, the government minted nearly 8 billion pennies, each with Abraham Lincoln's bearded profile facing right. (His colleagues on other coins all looked left, until Thomas Jefferson did an about-face on the nickel last year.)

Eggers said the costs of zinc and copper have fluctuated greatly over the years and are at all-time highs. He expects the market price to level off, bringing the cost of making pennies below the 1-cent mark once again.

If the penny is retired, the nickel might be next. In acknowledging that pennies cost more than 1 cent to make, the mint also had bad news for nickel lovers:

A five-cent coin costs 5.73 cents to make.

Microsoft Still Intends to Attack Adobe's PDF Application

Microsoft is well-known for seeing what becomes popular in the market and then attempting to either imitate it or crush it ...

As Stuart J Johnson on ENT News reported, they've still got their sights set on over-running Adobe's popular PDF application when they roll out their latest version of MS Office:

Not only will Microsoft Office '12' feature the ability to save files in PDF format, it will also -- no surprise -- support the company’s own challenger to Adobe’s popular Portable Document Format (PDF) file format.

Previously codenamed “Metro” and first demonstrated by Microsoft last spring, the XML Paper Specification or XPS will be included in Office 12, according to blog entries by several Microsoft officials. The company had previously revealed that XPS support will be included in Windows Vista, due out in the latter part of 2006.

XPS is a paginated document format similar to PDF that Microsoft has based on XML.

"I am happy to confirm that Office ‘12’ will support a native ‘Save as XPS’ feature in Word, Excel, PowerPoint, Access, Publisher, Visio, OneNote and InfoPath,” says a blog post on October 27 by Microsoft’s Jeff Bell, a program manager in the Office group.

"The Windows Digital Documents team is delivering a print driver with Windows Presentation Foundation [formerly codenamed ‘Avalon’] that will enable all applications that can print to create XPS files," Bell’s blog post continues.

The support for XPS output in Office “12” goes beyond what is typically passed to a printer, he says, "including the supporting information to enable, for example, working hyperlinks, searching, efficient representation of transparency and gradients, accessible documents, and document rights when the source document has restricted IRM [Microsoft’s Information Rights Management] rights." That enables it to be used in the same kind of read-only document format that PDF has owned for several years.

It’s no surprise that Microsoft plans to incorporate XPS support into Office. The firm’s Web site hosts an XPS page wherein Microsoft clearly states that it is providing APIs in Windows Vista to enable developers to generate "XPS documents from Windows Presentation Foundation applications."

Microsoft announced and demonstrated PDF support in Office 12 in early October at its MVP Global Summit in Redmond.

That move was seen by some as a nod to the Commonwealth of Massachusetts’ Executive Department, which has proposed to require that all files generated by that department support the OASIS OpenDocument format specification natively by January 2007.

Massachusetts announced its final proposal in late August, allowing applications that save documents in Adobe’s PDF, but not Microsoft’s XML schemas due to legal questions regarding the format’s openness. Also not surprisingly, Microsoft’s promised XPS support will be included in the same Office 12 applications that the company says will support PDF.

A Microsoft official was not immediately available to comment on Office 12’s XPS capabilities.

Ransomware: An Extortion Virus

David Derbyshire, the consumer affairs editor at The Daily Telegraph of London, reports on an insidious new threat lurking in cyberspace ...

A new virus that seizes control of personal computer files and demands ransom money from the owner has been unleashed on the internet.

Victims of a "ransomware" attack are unable to get access to their hard drives unless they pay off the hackers.

In some versions of the fraud, computer users are told to buy drugs from an online chemist in exchange for a password that will free their files.

In others, they are instructed to transfer money to an overseas bank account to prevent the program wiping the files.

Although the virus can be blocked by up-to-date anti-virus software, there are concerns that many computers are unprotected.

The fraud emerged in America last year and has now appeared in Britain. One of its first victims was Helen Barrow, a 40-year-old nurse from Littleborough, near Rochdale.

She was distraught when she discovered that her computer files had been replaced by a folder protected with a 30-digit password.

She also discovered a new file on her computer desktop named "Instructions How to Get Your Files Back." It told her she would be given the password to access her files if she bought drugs from an online pharmacy.

Mrs Barrow, who works as a senior sister at Rochdale Infirmary, said: "When I realised what had happened, I just felt sick to the core. I was in shock. It was a horrible feeling and I thought I was going to lose all of my work.

"I had lots of family photographs and personal letters on the computer and to think that other people could have been looking at them was awful."

Her computer became infected when she opened an e-mail attachment that claimed to be an anti-virus program. The virus that attacked her computer is known as Archiveus.

Mrs Barrow, a mother of two, contacted police and a computer expert who recovered some of the files, which included course work for her nursing degree.

Earlier versions of the ransomware program instructed victims to pay the ransom through online websites such as eGold or Webmoney. Others demand payments to overseas accounts.

Greg Day, a security expert with McAfee, said: "Sadly we are seeing more of this type of attack in recent months. It is a trend that started off in the business community and has now extended more into the consumer space."

"If people are effectively to protect against these kind of attacks, we would recommend they get good anti-virus software, have a firewall that controls what information people can access on your computer, and keep up to date with the security patches.

"If people find themselves being blackmailed like this they should contact their local police force.

"They should also contact their software security vendor who might be able to help them recover their work."