Cyber Security
Federal Division Envisions Important Role On Computer Front
by Ted Leventhal and Greta Wodele
The Homeland Security Department's science and technology directorate will play an important supporting role in efforts to secure the nation's computer infrastructure from attack, top officials with the directorate or broader department said on Monday.
In interviews with reporters from National Journal's Technology Daily, the senior officials emphasized that while their focus primarily will be developing technologies to counter threats posed by weapons of mass destruction, cyber security is a necessary component of their mission to support the technology needs of the operational directorates. They said computer-security experts will join the organization soon to guide research and development.
The departmental officials included: Penrose Albright, assistant secretary for science and technology; David Bolka, director of the Homeland Security Advanced Research Projects Agency (HSARPA); John Kubricky, director of systems engineering; Maureen McCarthy, director of research and development; and Charles McQueary, undersecretary for science and technology.
In collaboration with the department's information analysis and infrastructure protection directorate, the science and technology directorate plans to hire a program manager to lead a "virtual" cyber-security center of experts nationwide. Funding for the center will be provided in fiscal 2004, with a formal announcement about the manager "very close," the officials said.
The science and technology directorate already has hired Simon Szykman as cyber-security R&D director. On Thursday, Doug Maughan, a former employee at the Defense Advanced Research Projects Agency (DARPA) that served as the model for HSARPA, said he hopes to join the department to head the cyber-security research agenda. Maughan said he would work in the science and technology directorate for HSARPA.
Currently a contractor for Homeland Security who identifies research programs for critical infrastructure and organizes the cyber-security research agenda, he said the directorate is waiting for departmental divisions such as the Coast Guard, Secret Service and Transportation Security Administration to define their cyber-security requirements.
McQueary said the nationwide experts will work with the information analysis and infrastructure protection directorate "because that is our job. It's really a collection of experts from around the country that will help us decide what the overall portfolio for cyber security needs to be."
The National Science Foundation and National Institute for Standards and Technology also fund cyber-security research in coordination with the department, McQueary added.
McQueary said Homeland Security should consider incentives to entice the private sector into sharing detailed network-security practices. "Somehow we've got to sort through this and decide how do you get some useful information out of ... private industry since 85 percent of all the infrastructure is in private industry. We've got to draw upon that."
McCarthy, the directorate's research director, said important cyber-security technologies such as the development of "cyber forensics," the tools needed to track perpetrators of cyber attacks, fall within government's purview. But the directorate mostly will look to outsiders for innovation.
"I will not be doing a lot in the cyber world," she said. "Many cyber-security tools and technologies reside in the private sector, and much of the cyber-security portfolio's work will be in engaging academia and industry."

Intellectual Property
Advocate Argues For 'Humane' Anti-Piracy Technologies
by Drew Clark
Anti-piracy technologies can be made more "humane" if companies like Microsoft and Apple Computer take active steps to promote less restrictive approaches, a technology lawyer at the nonprofit advocacy group Public Knowledge said on Thursday.
Because those companies are in the business of driving mass customer adoption of digital technologies, they could play help nudge entertainment companies away from restrictive approaches to such digital-rights management (DRM), technology counsel Mike Godwin said.
"Consumers will tolerate a certain amount, but they like to have choices" about what DRM systems they utilize, Godwin said, comparing the way the software industry has evolved from stringent copy-protection technologies in 1983 to considerably looser ones today.
"I see the potential for the same kind of development of humaneness in the content," he said. But "it is going to take some leadership, and the leadership probably can't come from a regulatory agency."
Under the proposal in Godwin's "citizen's guide to DRM," Microsoft, Apple or other technology companies would distribute digital versions of once-copyrighted books like Mark Twain's Huckleberry Finn that now can be freely reprinted. But the e-books in the public domain, unlike copyrighted e-books that have failed to sell widely, would come free from encumbering restrictions on consumers' ability to copy or print pages.
Godwin said such a move would help educate consumers to distinguish among poorly implemented DRM technologies -- something that he ascribed to existing commercial implementations of e-books -- and "humane" versions that help protect copyrighted works without restricting consumers' "fair use" of them.
Although such a move would be a public service, it also could benefit companies like Microsoft and Apple by securing greater support for their technological platforms, Godwin said. Distributing the public-domain e-books wrapped in a DRM format also would help establish a baseline for content protection that is more friendly to users and encourage looser rules, he said.
Godwin made the proposal at a conference that Public Knowledge sponsored with the New America Foundation, and panel members from the academic, content and technology communities offered generally positive criticisms.
Building on a rhetorical question asked by moderator Alan Davidson, the associate director of the Center for Democracy and Technology, Time Warner counsel for intellectual property Sandra Aistars agreed that "DRM was not the devil."
Aistars criticized the premise that content companies would use anti-piracy technology to lock their content. "It is just not practical to abuse DRM," she said. "Companies are worried about competing with illegal services, and the only way to get people to move over to a legitimate service is something that allows people" to make fair use of material they legally purchase.
Aistars similarly defended mandatory technologies like the "broadcast flag," which is aimed at preventing piracy of digital television signals.
But Paul Stimers with the Alliance for Digital Progress took issue with such mandates. "Is DRM the devil? No," he said. "Is government-mandated DRM the devil? That is an entirely different question" -- and one that he said is accompanied by a host of evils.

Telecom
Lawmakers Unlikely To Make Big Telecom Changes Next Year
by Teri Rucker
Congress and the FCC this year began addressing issues affecting spectrum allocation, emergency services and universal service reform that they hope will be resolved next year, panelists said on Thursday at a Practicing Law Institute forum. But they added that broader reforms to telecommunications law can be expected over the next half-decade.
This year, the House approved legislation that would create a trust fund to reimburse government spectrum users whose services are moved to make way for commercial services, but that legislation stalled in the Senate when John Sununu, R-N.H., successfully added a provision giving Northpoint Technology free access to spectrum.
That "poison pill" means lawmakers cannot get consent to bring the bill to the Senate floor, said Kevin Kayes, senior Democratic counsel to Senate the Commerce Committee. "Everybody wants to approve the trust fund, but I don't know how we get over this hurdle," he said.
Kayes also predicted that lawmakers would try to revise the 1996 Telecommunications Act, but that likely will take four or five years to play out. There is a great deal of interest by lobbyists and lawyers for such an action, he said, "because it means a lot of business."
Those who will reap the most from the debate will be those with the most money and political clout, Kayes said, noting that the public debate no longer focuses on enforcing the law and fighting for competition. "We only talk about whether we should deregulate the four big companies to promote broadband" services over the Internet, he said.
The dynamics of the telecom reform discussion will be different than during the crafting of the 1996 act, Kayes said, due to the retirement of Senate Commerce Committee ranking Democrat Ernest (Fritz) Hollings of South Carolina and term limits requiring Sen. John McCain, R-Ariz., to step down as committee chairman. Sen. Ted Stevens, R-Alaska, is expected to head the committee during the 109th Congress.
Policymakers also are likely to address reform of the universal service program to ensure that the fund that provides affordable communications services to all Americans remains strong and sustainable. Howard Waltzman, Republican counsel to the House Energy and Commerce Committee, said the House is still in a listening mode and will conduct hearings but is not ready to legislate on the universal service issue next year.
However, the FCC is poised to act, said FCC Commissioner Jonathan Adelstein. As the FCC looks at reforms, Adelstein said he "will not support restricting support to primary lines."
The FCC also needs to rethink the way it provides support to competitors to the regional Bell telephone companies, he said, noting that assuming that their costs mirror those of Bells does not make sense and should be reconsidered.
Adelstein also noted that the FCC needs to understand how Internet-based phone service affects the fund. He said while he has not decided about the regulatory classification of the service, universal service obligations must be considered.

Telecom
Antitrust Official Sees Recent Gains In Telecom Competition
by Teri Rucker
The competition glass in the telecommunications market "is half full ... and rising," but the Justice Department needs to remain vigilant that companies do nothing to undermine the competition, innovation and consumer gains that have emerged during the last several years, an antitrust official said on Thursday at the Practicing Law Institute forum.
R. Hewitt Pate, an assistant attorney general in the Justice Department's antitrust division, said that while telecom competition did not come as quickly as policymakers predicted or expected after enactment of a 1996 law, lower prices for long-distance telephone service, competition for local phone service, and new services like high-speed Internet and wireless offerings all point to major gains for consumers.
Rumors have circulated in the industry about consolidation within the wireless industry and mergers between a regional Bell company and a large, long-distance carrier such as AT&T. Pate said that for two years people have been talking to him about the possibility of such mergers. While it is not possible to say whether the Justice would approve or deny such combinations, he stressed that the idea would be thoroughly reviewed.
In some senses, merger reviews are more complicated because of the diversified array of telecom services and service quality. For example, Verizon Communications offers local and long-distance phone service but also offers nationwide wireless calling, meaning that a merger would affect its wireless customers differently than its traditional phone customers.
And in the past, a Bell merger with a long-distance company would have been a vertical combination, but now that the Bells can offer long-distance service in all 50 states, such an acquisition would raise horizontal issues, Pate said, "so it makes it more difficult." "Where that leaves us, I don't know, except we will apply antitrust analysis," he said, noting that the agency "will not preside happily over a merger" that would eliminate competition or harm innovation.
Pate noted that critics have alleged that antitrust law cannot keep pace with innovation, but he disagreed, saying that such ideas are "overstated."
While competition has emerged, he said the challenge for regulators will be ensuring that the "telecom industry remains on a competitive path." Justice "will be alert to allegations of predatory conduct that retards innovation or hurts competition" and respond forcefully, he said.

Budget
Science Agency Set For Boost Under Omnibus Spending Bill
by Teri Rucker
The omnibus spending bill for fiscal 2004 awaiting action when lawmakers return would boost funding for the National Science Foundation (NSF). Lawmakers also restored part of the funding for the Commerce Department's Technology Administration that the House and Senate Appropriations committees had voted to strip.
The House is expected to vote on the spending bill early next week, but it is doubtful that the Senate will act before January because of Democratic opposition to quick action. The measure combines the text of the seven remaining annual spending bills for the year, which cover spending for 11 federal departments, foreign aid and the District of Columbia.
The conference report for the bill, H.R. 2673, would allocate $5.6 billion for the NSF in fiscal 2004, about $130 million more than the Bush administration requested and a boost of nearly $300 million over fiscal 2003.
Lawmakers retained the House request of $4.3 billion for research, compared with the Senate's request of $4.2 billion for research and related activities. The bill maintained the Senate's allocation of $3.9 million for the National Science Board, the governing body of NSF.
The National Aeronautics and Space Administration would receive $15.5 billion, a boost of $80 million over the fiscal 2003 level.
The Senate bill sought $15 million to help public housing residents develop the technology skills needed in today's workforce, but the compromise makes no mention of such an earmark.
Within Commerce, the Technology Administration would receive $6.4 million in fiscal 2004 despite efforts by the Senate Appropriations Committee to eliminate funding for the agency. The administration had sought $8 million.
Lawmakers also agreed to provide $14.6 million for the National Telecommunications and Information Administration within Commerce. And $22 million would be allocated for grants to fund public telecom facilities, planning and construction, and $15 million would be for information infrastructure grants.
The omnibus bill also contains $39.6 million for the Manufacturing Extension Partnership housed at the National Institute for Standards and Technology and $179.1 million for the Advanced Technology Program, dictating that $60.7 million would have to be spent by the end of fiscal 2004. The Bush administration had targeted both programs for cuts.
Congress also earmarked $1.8 million for the Social Security Advisory Board, noting that funds unused by the end of fiscal 2004 would remain available for the Social Security Administration to invest in information technology and telecom equipment.
Appropriators are calling for the funding of technology investments for drug enforcement efforts. For example, the bill would offer the Drug Enforcement Administration $6.8 million "to enhance the Internet Online Investigations Project" and to develop a system that would enable online transfers of prescriptions from doctors to pharmacies.
Other tech-related items include a $1 million allocation for the Broadcasting Board of Governors to oversee a pilot program that would use Internet technologies to thwart jamming of broadcasts to China.

Courts
Foes Of Class-Action Bill Cry 'Shut Out' In Negotiations
by Molly M. Peterson, CongressDaily
More than 70 consumers, civil rights and environmental groups that oppose a bill to overhaul the class-action legal system contended that they were "completely shut out" of the negotiations that led to last week's deal among bill sponsors and three Senate Democrats who had previously voted to block action on the measure.
"We urge you to reject this so-called compromise," representatives of the groups wrote on Wednesday in a letter to senators. "It is nothing more than another bail-out for companies that break the law." The Consumer Federation of America, Consumers Union, U.S. Public Interest Research Group were among those that signed the letter.
The groups also charged that the deal is the result of "secret negotiations with the Chamber of Commerce, whose members stand to gain hundreds of millions of dollars in reduced liability if the bill passes."
A Democratic aide said that characterization of the negotiations is "just not accurate." The aide noted that the deal includes "around eight to 12 changes to the bill" that were prompted by concerns raised by consumer and civil rights groups.
"To say they were shut out is belied by the changes we succeeded in negotiating for the bill," the aide said. "Did they get everything they wanted? No, but nobody ever does in these kinds of negotiations."
Matthew Webb, vice president of legal reform policy for the chamber's Institute for Legal Reform, said consumer groups had "ample opportunity" to make their views "very well known" to lawmakers during the class-action negotiations.
"They have conversations with the folks up there, and the Chamber of Commerce has conversations with the folks up there," Webb said. "As far as we're concerned, it's how the legislative process works. ... The senators could avail themselves of the opportunity to talk to anybody they wanted to in this process."
Last week's deal addresses concerns that Democratic Sens. Charles Schumer of New York, Christopher Dodd of Connecticut and Mary Landrieu of Louisiana raised about the formula for removing class-action cases to federal court, potential abuses of the practice of offering consumers coupons in settlements that net attorneys large fees, and other issues.
Schumer, Dodd and Landrieu were among the 38 Democrats who in October voted not to limit debate on the bill, saying that while they agreed with the need for class-action reform, they could not support the bill in the form it had then. Supporters of the bill fell one vote short of the 60 they needed to break a filibuster by Democratic opponents.
In a joint statement released with Majority Leader Bill Frist, R-Tenn., and several bill sponsors last week, Schumer, Dodd and Landrieu said the agreement addresses "abuses in the class-action system while protecting the rights of Americans to get justice through the courts."



Today's Feature:
State Roundup
Maryland Gov. Bob Ehrlich, Virginia Gov. Mark Warner and Washington, D.C., Mayor Anthony Williams met in Annapolis on Tuesday to discuss the D.C. metropolitan area's homeland security issues. Meanwhile, North Carolina Attorney General Roy Cooper warned state residents to beware of Internet identity thieves "phishing" to steal personal information via fake e-mails.
Every Thursday, read the State Roundup by Staff Writer Chloe Albanesius
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E-briefs


White House: President Bush on Thursday signed into law a bipartisan measure to update a major credit reporting law with stronger federal protections against identity theft and a permanent extension of provisions that pre-empt many state consumer protection laws. Bill supporters said those pre-emptions will provide "uniform national standards" for consumer protections against identity theft and maintain efficiency within the credit reporting system. Without those standards, "retailers and the customers we serve could have been subject to a confusing patchwork of new state laws, rules and regulations," said Tracy Mullin of the National Retail Federation. But critics said states should have the right to enact stronger consumer protections than those provided under federal law. "Finally, consumers nationwide have gained important new rights to fight identity theft and clean up credit bureau mistakes, but at the unacceptably high price of unfair, permanent limits on state rights," said Ed Mierzwinski of the U.S. Public Interest Research Group.
Security: The top Democrat on the Senate Governmental Affairs Committee criticized the Homeland Security Department on Thursday both for failing to have its terrorist watch-list consolidation center fully operational by the Monday deadline and for failing to assess the privacy implications of biometrics technology to be installed in airports next month for tracking foreign visitors. Joseph Lieberman of Connecticut said the watch-list center was only offering "limited" capabilities as of Monday, which he called "an outrage" exhibiting "inattention and irresponsibility at the highest levels of our government." He also sent a letter to Homeland Security Secretary Tom Ridge to request a privacy study on the biometrics technology before it becomes operational. "In order to win public acceptance of new systems and new technologies that collect and store personal information, it is essential that the American people trust that their personal privacy is being appropriately considered and protected," he wrote.
Intellectual Property: Music publishers and some of the smaller peer-to-peer computer services are coalescing to the idea of requiring a compulsory fee as an immediate solution to revenue losses caused by free digital music downloads, said Marty Lafferty, CEO of the Distributed Computer Industry Alliance. Lafferty proposed a monthly fee of about $5 on each high-speed Internet company in a Thursday speech to the cable industry. "The publishers were consistent in vocalizing that what is needed here is a compulsory license, and some of the smaller P2P software companies feel the same way," said Lafferty. DCIA was founded by Sharman Networks (which owns the largest P2P company Kazaa), and Sharman's partner Altnet. Those firms do not support the compulsory license model at this time, but Lafferty said his proposal deserved consideration. The next phases on DCIA's presentation called for cable operators to offer channels and then individual tracks of songs protected by anti-piracy technology.
Domains: The Internet firm VeriSign may reintroduce early next year a mechanism that redirects mistyped Internet addresses to a company-operated search tool, a company officer said on Wednesday. "When we discontinued Site Finder in October, we said we were exploring our options, and that's what we continue to do," Tom Galvin, vice president of public affairs, said in an interview. "We continue to work with folks in the industry on the best way to re-implement it. We will continue to chat with industry over the next month or months to sort it out." The company also got ideas on improving the system at the October board meeting of the Internet Corporation for Assigned Names and Numbers (ICANN), which ordered Site Finder's suspension after it proved potentially disruptive to the Internet. VeriSign continues to discuss the issue with ICANN, and would call for comments before re-implementing it, Galvin said.
E-Government: ObjectVideo, a top provider of video-based security software, has won a contract to provide security at Andrews Air Force Base, the airfield used by the president. ObjectVideo will install and maintain its video software to safeguard all procedures, such as maintenance, fueling and loading, that occurs when an airplane is on the ground, the company said. The chosen software detects, identifies and analyzes in real time the potential threats captured on video. The project at Andrews is a first step in an extensive Air Force initiative to be completed in 2008 to bring all base security and force-protection programs under one directorship and deploy electronic security systems at facilities worldwide. In other news this week, US Protect, a leading provider of security, force-protection, risk-assessment and emergency-preparedness services, won a contract to provide physical security for the Agriculture Department.
Culture: Public reaction to the Homeland Security Department is "modestly positive," according to a National Harris poll released Wednesday. Of the 2,056 adults polled online in October, 56 percent viewed the department positively. The agency asked the public for their opinions on 11 federal agencies, with the Centers for Disease Control receiving the highest rating of 90 percent and the Social Security Administration receiving the lowest with 48 percent. The Federal Aviation Administration received a 76 percent approval rating; up from 54 percent two years ago. Meanwhile, the Securities and Exchange Commission's approval rating dropped from 71 percent in 2001 to 57 percent this year. Harris has done this survey for three years and reported a surge in agency approval ratings following the Sept. 11, 2001 terrorist attacks, but found that those ratings have since slipped back to the 2000 levels or lower.
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