Payment Wars: How Merchants And Carriers Are Trying To Block Payment Systems They Can't Track

from the dangeorus dept

Over the weekend, it came out that two giant pharmacy chains, Rite Aid and CVS, had started blocking Apple Pay, the massively hyped new payment system from Apple that has received much praise for its ease of use. The product had worked for about a week before the two companies started blocking such near field communication (NFC) payments (which also takes out other NFC payment options like Google Wallet). While Rite Aid gave a vague and slightly ridiculous explanation -- that it is "still in the process of evaluating our mobile payment options" -- pretty much everyone knows the truth. A bunch of retailers, led by Walmart, have been creating their own mobile payment system called CurrentC, which cuts out the credit card companies. But, it also builds in all the tracking and spying features of store loyalty cards, expanded across all merchant partners. Apple Pay lets people remain anonymous.

In short: CurrentC lets merchants (1) cut out credit card transaction fees and (2) get more and more data on shoppers. No wonder they want to block out other options.

But this isn't the start of such fights. Last year, mobile carriers like T-Mobile, Verizon and AT&T sought to block Google Wallet in favor of a similar consortium of mobile operators, looking to create their own NFC payment system, which was unfortunately named ISIS until world events led the consortium to change its name to Softcard.

All of these moves should be concerning. They're clearly not being done with the consumer in mind. Nearly everyone who's played with Apple Pay has agreed that the system is a huge leap ahead for mobile payments in terms of ease of use. Instead, we're seeing giant organizations looking to team up to keep competitors out of the market. At the very least, this should raise serious antitrust issues. But it also demonstrates, in a different sphere, why net neutrality is such a concern. When you have large companies that can effectively collude to block or kill certain powerful and useful apps and services, it hinders and blocks important innovations, leaving consumers significantly worse off. Not only are they left with fewer choices and lower quality apps and services, but it also pushes consumers into services -- like CurrentC -- that take away their privacy.

Filed Under: apple pay, collusion, control, credit cards, currentc, google wallet, mobile payments, nfc, operators, payment, retailers, softcard, wireless payments
Companies: apple, at&t, cvs, google, rite aid, softcard, t-mobile, verizon

Almost No One Wants To Host The Olympics, Because It's A Costly, Corrupt Mess

from the protect-that-brand dept

For many years, we've written about questionable activities by the Olympics, usually focusing on the organization's insanely aggressive approach to intellectual property, which could be summed up as "we own and control everything." Yes, the Olympics requires countries to pass special laws that protect its trademarks and copyrights beyond what standard laws allow. Of course, this is really much more about control and money. It's simply shining a light on just how corrupt the whole Olympic setup is. For decades, the Olympics has tried to hide this basic truth, and it has always been able to get various cities and countries to actively compete to suffer through the Olympics requirements, often with promises of big money in tourism and local business as a result. But it looks like jig may be up.

As Dan Wetzel notes, it appears that almost no one has any interest in hosting the 2022 Olympics. The only active attempts are Beijing (which is 120 miles from a mountain suitable for skiing) and Almaty Kazakhstan. All the other credible players have bailed out:

Certainly not Oslo, Norway, not even at the bargain rate of an estimated $5.4 billion in a nation of just five million people. It once wanted desperately to host the 2022 Winter Olympics and its bid was so perfect that it was considered the favorite to win. Then the country held a vote earlier this year and 55.9 percent of Norwegians opposed.

Wednesday the Norwegian government effectively pulled the bid. Norwegians are known for the ability to cross country ski really fast and being so friendly they beg visitors to come experience their picturesque nation. Since this involved the IOC however, they decided against having visitors come experience their picturesque nation to watch them cross country ski really fast.

They aren't alone. Previous finalist Krakow, Poland, saw 70 percent voter opposition and pulled its application. A majority felt the same way in Germany and Switzerland, killing bids in Munich and St. Moritz respectively. In Sweden the majority party rejected funding the proposed games in Stockholm.

Plenty of other countries didn't even bother thinking about it. As Wetzel points out, basically the only two countries interested are authoritarian regimes:

Essentially the only places interested in hosting the 2022 games are countries where actual citizens aren't allowed a real say in things – communist China and Kazakhstan, a presidential republic that coincidentally has only had one president since it split from the old USSR in 1989.

To sum it up:

Essentially the entire world has told the IOC it's a corrupt joke.

Don't hold back:

The IOC has billions of dollars laying around and billions more coming because to most people the Olympics is just a television show and the ratings are so high that the broadcast rights will never go down. The IOC doesn't pay the athletes. It doesn't share revenue with host countries. It doesn't pay for countries to send their athletes. It doesn't lay out any construction or capital costs. It doesn't pay taxes.

It basically holds caviar rich meetings in five star hotels in the Alps before calling it a day. That and conduct weak investigations into corruption charges of the bidding process, of course. "No evidence uncovered" is on a win streak.

It's a heck of a racket.

Except now the racket may be ending. Except for China and Kazakhstan. Wetzel's conclusion is spot on:

So China or Kazakhstan it is, the last two suckers on earth willing to step up to this carnival barker.

One lucky nation will win. The other will host the 2022 Winter Olympics.

The Olympics are from another era -- one of top down, "we control and own everything while paying none" variety. We've seen those types of businesses failing in lots of other arenas -- and now it may be happening to the Olympics as well.

Filed Under: china, control, corruption, kazakhstan, olympics, sports, top down

Health Experts Issue Call To Prevent ICANN's Commercialization Of New .health Domain Leading To Exclusive Control Of Online Health Information

from the enough-is-enough dept

Last month, we wrote about a troubling decision by the Internet Corporation for Assigned Names and Numbers (ICANN) to give control over the new .pharmacy domain to big pharma -- thus allowing it to lock out sites around the world that threaten its generous profit margins. An article in the journal "Globalization and Health" warns that something similar could be about to happen in the realm of public health:

In just a few weeks, the Internet could be expanded to include a new .health generic top-level domain name run by a for-profit company with virtually no public health credentials -- unless the international community intervenes immediately. This matters to the future of global public health as the "Health Internet" has begun to emerge as the predominant source of health information for consumers and patients.

The paper, which is open access, and can therefore be read for free in its entirety, gives some hypothetical examples of what could happen:

http://www.[smoking].[health](potentially purchased by a tobacco company)

http://www.[vaccinatekids].[health](potentially purchased by anti-vaccine activists)

http://www.[obesity].[health](potentially purchased by a junk food company)

http://www.[cancer].[doctor](potentially purchased by unscrupulous vendors catering to the desperate dying)

The paper's authors explain:

Despite this increasing use and reliance on online health information that may have inadequate quality or reliability, the Internet Corporation for Assigned Names and Numbers (ICANN) recently announced it intends to move forward with an auction to award the exclusive, 10 year rights to the .health generic top-level domain name. This decision is being made over the protests of the World Medical Association, World Health Organization, and other stakeholders, who have called for a suspension or delay until key questions can be resolved.

ICANN responded to those concerns by asking the International Chamber of Commerce to decide whether a company, rather than a health organization, should be allowed to run the .health domain. No surprise what the outcome was:

a rejection of challenges filed by ICANN’s own independent watchdog and others, such that ICANN's Board decided in June 2014 that there are "no noted objections to move forward" in auctioning the .health generic top-level domain name to the highest bidder before the end of the year.

"No noted objections" if you exclude important chunks of the world's medical community, that is. Or perhaps ICANN simply meant "no noted objections from the companies that stand to gain the most from controlling this lucrative domain". The paper's authors conclude:

we call for an immediate moratorium/suspension of the ICANN award/auction process in order to provide the international public health community time to ensure the proper management and governance of health information online.

In fact, we need to go much further. Rather than simply calling for a moratorium on the auction of these new domains, we should be calling for ICANN itself to be abolished, and replaced with an organization that is concerned with maximizing the global benefits of running the Internet domain system and not, as presently seems the case, with maximizing the profits of a few lucky companies. ICANN has had long enough to show that it is a worthy guardian of this unique and critical resource; it has failed to do so. Time to get rid of it.

Follow me @glynmoody on Twitter or identi.ca, and +glynmoody on Google+

Filed Under: .health, control, health, profit, tlds, top level domains
Companies: icann

Moby Not Just Giving Away His New Album For Free On BitTorrent, He's Okay With You Profiting From It

from the an-enlightened-view dept

The musician Moby has long been an outspoken critic of the old recording industry. He's been a big fan of giving away works for free (and noting that he's made quite a bit of money from music he's made available for free) and has argued strongly against the old gatekeepers. He's criticized their anti-innovation views, suggested the RIAA should disband for suing music fans, and said he can't wait for the major label gatekeepers to die.

So it shouldn't be too surprising that Moby happily teamed up with BitTorrent to release his latest album as a BitTorrent bundle for free (you just have to provide an email address). But here's the more surprising part. Not only is he happily making it available for free, but he's actually fine with people profiting from potential remixes or other uses of the music. As he explained in a recent interview with Mashable:

Are people really free to do whatever they want? Can they sell their recordings?

I met with the BitTorrent people and they were asking, "What if someone comes up with their own remix and they sell it?" They were wondering what I would want them to do with the money. And my response was that they could take their friends out to dinner or give money to their favorite charity. Even if I make the stems, if they made the effort to make the remix, they should be the ones to profit from it.

This is a really enlightened view. Even among people who are accepting of how to use free in a business model, we still see artists get uptight about "commercial use" -- even though it's often not entirely clear what qualifies as commercial use. We've long advocated that more people should be open to the idea of allowing commercial use of their works, as the potential benefits for everyone -- including the artist and fans -- could be great. I recognize this still makes some artists (who otherwise support remix and open culture) nervous, but I think as we get more examples of artists who allow for commercial use, and see how well it works, that we'll see more artists get comfortable with allowing others to profit as well.

The rest of the Moby interview is worth reading as well. He points out that artists who adapt aren't worried about infringement:

Artists who are adaptable are doing fine. A musician who makes records, tours, DJs, remixes, does music for video games and films is doing fine. If you can learn how to adapt — it's really weird and unhealthy when people talk about restricting progress to accommodate the inability of people to adapt. Every industry has been impacted by [changes in technology] in both negative and positive ways, but I feel like to complain is pointless. I love Thom Yorke, but when I heard him complaining about Spotify, I'm like, "You're just like an old guy yelling at fast trains." I love anything that enables people to have more music in their lives.

He also talks about how great other services like Spotify, SoundCloud and Pandora are -- and notes that he's actively lobbied Congress not to restrict such services. He also talks about how ridiculous it was when his old label, EMI, tried to control everything to prevent infringement:

It was about 7 or 8 years ago when I was on EMI, and someone at EMI business affairs contacted my manager and told him that I wasn't allowed to play my own music when I DJ'ed because they didn't want people in the audience pirating it. This was back in the days of the Nokia flip phone. If someone recorded a song in a nightclub it would be the worst sounding recording you could possibly imagine. You probably wouldn't even be able to identify the song. That seemed like nonsense to me.

Instead, he notes, that wonderful things happen when you stop focusing so much on control, and let creativity and innovation flow:

My approach is to not try and control it at all. I really like the idea of not just giving people finished content. It's giving them something that if they choose to they can manipulate and play with however they want. There's absolutely no restrictions on it and that makes me happy. When people try to control content in the digital world, there’s something about that that seems kind of depressing to me. The most interesting results happen when there is no control. I love the democratic anarchy of the online world.

This kind of stuff is very refreshing after the latest round of artists on the wrong side of history trying to hold back creativity, culture, innovation and progress.

Filed Under: bittorrent, business models, control, free, moby, music, recording industry, sharing

Kevin Spacey: Give Users Control, What They Want, When They Want It, At A Fair Price, And Stop Worrying About Piracy

from the well,-duh dept

It appears that Kevin Spacey gets what so many of us have been saying for over a decade: piracy isn't so much a problem as it is a statement of demand from users. And the way to "beat" piracy is to do a better job of offering fans what they want, in a manner they want it, at a reasonable price. Spacey recently gave a talk in Edinburgh in which he discussed the success of House of Cards, the "TV show" that he released via Netflix with all episodes coming out at once. First he discussed the ridiculous hoops that regular networks wanted them to go through, having to first film a pilot and go through the hell of "pilot season" that every network does each year, but then he made the same basic point that many of us have been making for so long: Here's the key part:

Clearly the success of the Netflix model, releasing the entire season of House of Cards at once, proved one thing: the audience wants the control. They want the freedom. If they want to binge... we should let them binge.... And through this new form of distribution, we have demonstrated that we have learned the lesson that the music industry didn't learn: give people what they want, when they want it, in the form they want it in, at a reasonable price and they'll more likely pay for it rather than steal it. Well, some will still steal it, but I think we can take a bite out of piracy.

Ignoring the misleading use of "steal," he's making exactly the right point. Nothing (absolutely nothing) does away with all copyright infringement. But if you can get a huge number of people to give you money, it doesn't matter. And the best way to get more people to give you money (and, in fact, to give you more money) is to give people more of what they want. That includes good content, but also convenience, ease of use, and reasonable pricing.

He goes on to say a few more things worth listening too, including the fact that people want good stories, whether they're in movies, TV shows, video games or something else, and the entertainment industry has a real opportunity to deliver it.

The clip is five minutes long and worth watching. The point, as we've been saying for years, is not to justify "piracy" or infringement, but to show that the "piracy" problem might not be a problem at all if you can give people a good reason to buy. Spacey did that with House of Cards, and it's good to see more people realizing that piracy isn't the problem, but the symptom -- and the solution is a combination of good content, innovation, and recognizing that you need to treat the fans right, rather than as criminals.

Filed Under: control, copyright, fans, house of cards, infringement, kevin spacey, piracy
Companies: netflix

True Purpose Of DRM: To Let Copyright Holders Have A Veto Right On New Technologies

from the why-they-fight-so-hard-for-anti-circumvention dept

A whole bunch of people have been submitting Ian Hickson's writeup on the true purpose of DRM. Given how many people have submitted it, perhaps you've seen it already, but there are some really good points in there. His main thesis is that the debates over DRM tend to focus on the wrong thing. The anti-DRM crowd points out that DRM does not and cannot stop copying. Supporters of DRM say that's not true. Hickson agrees that DRM does not stop copying, but he argues that the purpose of DRM has never really been about stopping copying, but about gaining control over software and hardware tools that play content:

The purpose of DRM is not to prevent copyright violations.

The purpose of DRM is to give content providers leverage against creators of playback devices.

Content providers have leverage against content distributors, because distributors can't legally distribute copyrighted content without the permission of the content's creators. But if that was the only leverage content producers had, what would happen is that users would obtain their content from those content distributors, and then use third-party content playback systems to read it, letting them do so in whatever manner they wanted.

He provides a few examples, such as how DVD players force you to watch "unskippable" ads, how services like Netflix can try to limit you from watching the same movie simultaneously on two devices, and how if you buy a movie on iTunes, and want to then watch it on a non-iPhone, you'll have to buy it again. As he notes none of those things are really about copyright violations.

In all three cases, nobody has been stopped from violating a copyright. All three movies are probably available on file sharing sites. The only people who are stopped from doing anything are the player providers -- they are forced to provide a user experience that, rather than being optimised for the users, puts potential future revenues first (forcing people to play ads, keeping the door open to charging more for more features later, building artificial obsolescence into content so that if you change ecosystem, you have to purchase the content again).

If you're wondering why copyright holders are soooooooo desperate to have anti-circumvention provisions in copyright law, this is why. In the past, we'd pointed out that it didn't make sense for the movie studios and record labels to be so focused on anti-circumvention/digital locks, since if people are violating copyright law (such as by reproducing or distributing copies), existing copyright law already covers that. So why add in a separate provision all about circumvention -- and then be so focused on making sure the same provision exists in all laws around the globe? It seemed silly, because the only "additional" benefit it seemed to be providing was to outlaw legal forms of copying, since everything else was already covered under existing law.

However, Hickson's argument explains much more clearly why anti-circumvention provisions are seen as an absolute necessity. It has nothing to do with copying, and everything to do with controlling the players so as to limit the kind of innovation they can provide. It's basically a de facto veto power over new technologies. And, really, that puts a bunch of other statements in context as well. Remember how former Copyright Register Ralph Oman was saying that new player technologies should be illegal until Congress approved them? Yeah, same basic thing.

All of this shows a legacy copyright industry that is so focused on holding back innovation so that they have a veto right and control over the pace of innovation. That, of course, is bad for the economy, bad for the public and bad for society. Innovation is important in growing the economy, and due to silly laws around DRM, we are purposely holding it back.

Filed Under: control, copyright, drm, ian hickson, purpose

Will The ITU's Increasing Focus On Control And Surveillance Split The Internet?

from the great-schism? dept

Techdirt covered the WCIT circus in Dubai in some depth last year, since important issues were at stake. As many feared, after a moment of farce, it became clear that a serious schism in the ITU was opening up -- between those who wanted the Internet largely left alone to carry on much as before, with the possibly naïve hope that it might act as a vehicle of freedom, and those who wanted it regulated more closely, certain it could become an even better instrument of control.

Although WCIT is over, the ITU journey continues, and a fascinating post by Anthony Rutkowski on the CircleID Web site gives us a glimpse of where exactly it's heading -- and it doesn't look good. The ITU's "Internet/cloud" Study Group 13 is convening soon, and as Rutkowski points out, the provenance of the contributions submitted to this meeting reflect what is happening to the organization: 70% of them are from China or Korea.

Almost everyone has fled the organization except for a few established participants from China and Korea and their partners. Pretty much all of industry together with the G55 nations [who refused to sign the WCIT treaty] have left.

Just as telling is the subject-matter:

The contributions predominantly deal with the mechanics of pervasive surveillance and content control. This includes DPI mechanisms and use cases, filtering of content to local networks, control of individual user mobile phones, controls on peer-to-peer services, extensive regulatory controls on cloud computing facilities, and Big Data Analytics for extracting every nuance about individual users from real-time communications and stored data.

As Rutkowski rightly notes, given this continuing descent into police-state territory, there are now two paths for the ITU. The first is to pull back from the brink, and to return to a consensus-based approach that allows the G55 nations to participate in the development of basic Internet standards -- not those predominantly designed for surveillance.

Alternatively, the G89 nations who did sign the WCIT treaty may decide it is more important for their sections of the Internet to be firmly under their control than for there to be a single, unified set of Internet standards for the world. The schism would be formalized, with a more open G55 Internet linking up as best it could with the more closed G89 network. That would be a tragedy for humanity, but on the basis of the WCIT conference and the developments since then, it's certainly not something that can be ruled out.

Follow me @glynmoody on Twitter or identi.ca, and on Google+

Filed Under: control, dpi, fragmentation, internet, itu, surveillance

From SOPA To Cybersecurity: All About Trying To Control The Internet

from the watch-this dept

Al Jazeera English recently did a very well done episode on its Fault Lines program about attempts by Hollywood and the US government to control the internet. It's about 24 minutes long and includes interviews with a bunch of people who were involved in protecting the internet discussing what happened. The first half is about the SOPA/PIPA fight, and how it was basically about Hollywood trying to hold back the internet: Halfway through, it shifts to talk about the various cybersecurity bills and attempts to crackdown on Anonymous. Basically, it's about the government completely overreacting to what they believe are "threats" to the internet. Towards the end it also talks about how the government can and does abuse its powers, highlighting the case of Thomas Drake. It's a great video with some fantastic interviews, though it could do without the overly dramatic music. Still, it's good to see more people connecting the dots, and recognizing that much of what we're seeing these days is really just an attempt to "control" a platform that has been so successful because it was so wide open. Many of us believe that it needs to stay that way to remain a powerful tool for speech and for progress.

Filed Under: control, cybersecurity, internet, sopa

Ubisoft DRM Fiasco: Allows Any Website To Take Control Of Your Computer

from the punishing-your-paying-customers dept

It's been nearly seven years since the great Sony rootkit fiasco, when it was discovered that Sony Music was using some DRM on its CDs that self-installed a rootkit (without letting users know) that had all sorts of security problems and vulnerabilities. The company took a massive hit for this, and you would think that others would be a lot more careful with their own DRM. You would think. But, then you don't know Ubisoft. The vast majority of times we've ever discussed Ubisoft in these pages, it's been because the company was doing something ridiculous with DRM. The company loves its DRM and seems to refuse to recognize that pissing off legitimate customers isn't such a good idea.

So would it come as any surprise that it may now be facing a "rootkit moment" of its own?

As a whole bunch of folks have been submitting, some hackers have figured out that Ubisoft's Uplay DRM appears to install an unsecure browser plugin. The details came out over the weekend, first on a security mailing list, and were then followed up with some test exploit code posted to Hacker News.

Basically, it appears that Ubisoft's DRM is installing an accidental backdoor that makes it possible for any website to effectively take control over your computer. That's... uh... pretty bad.

From the details, the real problem sounds to be one of exceptionally poor coding, rather than maliciousness. Basically, they wanted to let you launch the game via a website, but failed to limit it to just the game -- meaning that a site can make use of the plugin to basically do a whole bunch of stuff on your computer (including things you don't want it to do). The browser plugin is easy to remove (and you should, um, immediately, if you've installed any Ubisoft games), so it's not quite as messy as Sony's rootkit, which was pretty deeply buried. But it's still really bad.

Yet another case of DRM really making life difficult for legitimate customers who paid money for your product. When will companies figure out that DRM does nothing to stop piracy, but makes life really difficult for the people who actually give you money?

Filed Under: browser plugin, control, drm, rootkit, security, uplay
Companies: ubisoft