U.S. court lets stand Verizon deregulation

federal appeals court on Friday let stand a 2006 action by the U.S. Federal Communications Commission that lifted some regulations on Verizon Communications broadband business.
The Court of Appeals for the District of Columbia said it would not review a challenge, filed by Sprint Nextel, other telecommunications carriers and the New Jersey Division of Rate Counsel, that contested the way the FCC decision was reached.
At issue was a petition by Verizon to the FCC asking the agency to waive regulations on its broadband business on the grounds that they were no longer necessary. Under federal law, such a petition is deemed granted if the FCC does not act on it within a specified period of time.
The FCC never formally approved a decision on Verizon's petition, but the company's request took effect in March 2006 because the FCC commissioners were deadlocked on the issue. The agency's two Democratic commissioners objected to broad deregulation, saying it threatened to bring higher prices and less choice.
The court said it agreed that the deadlocked FCC vote did not represent denial of the petition and that Congress had directed the agency to treat a petition it does not deny as granted.
Now on News.com
CAD software is the new black Photos: Cracking open a lightsaber Dell--not the PC maker you used to know Extra: Freedom of speech online
"The deadlocked vote cannot be considered an order of the commission, nor can it constitute agency action," it said.
"We also recognize that because a deadlocked vote is unreviewable, we lack jurisdiction in what may be the hardest case--cases in which the forbearance petition raises such difficult issues that it produces an equally divided vote among the commissioners," the three-judge panel said.
The FCC declined to comment on the court ruling.
Among other things, the broadband service regulations lifted on Verizon included requirements for making connections to competing networks and negotiating just and reasonable terms for its services.
The Verizon case prompted criticism from some members of Congress, and the agency is reevaluating its procedures for so-called forbearance cases.
The Friday court ruling was posted on the Internet (PDF).

A new electrode for cutting the price of making hydrogen

A new electrode for cutting the price of making hydrogen
Posted by Michael Kanellos
Although hydrogen is the most abundant element in the universe, it's a royal pain to make.
Most industrial hydrogen producers currently make the gas by heating methane and water to 815 degrees Celsius and causing a reaction. Unfortunately, this process generates 9.3 kilograms of carbon dioxide for every kilo of hydrogen, so it's not environmentally friendly or cheap.
Other companies like Signa Chemistry have come out with chemical catalysts that can strip hydrogen from water.
Then there is electrolysis, which involves cracking water molecules with electricity. Electrolysis doesn't produce any greenhouse gases or chemical residues so it's the most environmentally friendly. It's also expensive and time consuming. QuantumSphere says it has a way around this problem.
It has devised an iron-nickel power for coating an electrode that speeds up the electrolysis process, according to CEO Kevin Maloney. It's a classic nano play. Coating a surface with small, independent particles increases the reactive surface area, which means more simultaneous reactions between molecules. Quantum's Stingray electrodes have more than 2,000 times more catalytic surface area than standard electrodes coated with standard sized particles, he said.
The Stingray can produce 2.4 kilograms of hydrogen in 25 minutes. Standard electrodes can take hours or days, he said. As a result, the Stingray can produce hydrogen at $2.50 to $9 a kilo, not including subisidies. That's in the range that excites the Department of Energy.
No, the hydrogen economy doesn't exist yet. But researchers around the globe continue to ponder ways to produce, store and transport the stuff cheaply. Some car makers still maintain that hydrogen cars will come out within a decade or so.
A spin-out from Caltech, QuantumSphere also makes particles for rocket engines and other industrial applications. We wrote about them a few years ago here

Killing fungi and bacteria, the Aussie way

Killing fungi and bacteria, the Aussie way
Posted by Michael Kanellos
HALF MOON BAY, Calif.--Chlorine is bad for you, and iodine isn't, points out Jared Franks, CEO of Ioteq, and that difference is the basis of the company's business.

The Australian company has come up with a water purification system that kills microbes with iodine rather than chlorine or ozone. Ioteq's Isan system basically immerses fruit and vegetables in iodine-soaked water, and monitors the iodine dosage.
After purification, the produce gets bagged and sent to grocery stores. The process leaves a minimal iodine residue that is not harmful to people--and it doesn't change the flavor, Franks said. Iodine is a nutrient used by the medical profession to clean germs. The residue can also be washed off.
Not only does the iodine kill microbes, it extends the shelf life of produce. Some Australian customers are able to keep cherries on store shelves for eight weeks--far longer than normal, Franks said during a presentation and a meeting at the AlwaysOn Venture Summit West here Friday.
The water in the Isan system can also be used several times, which cuts processing costs. The system sucks the iodine out of one purification cycle and sends the water back to the start of the process. With water in short supply in places like Australia and California, that's a big deal, Franks said.
While Ioteq currently sells its products to food growers, it hopes to branch into the municipal-water market, selling large-scale systems to water districts.
It has installed 150 systems so far.
Agriculture and water are often overlooked, but they are two of the growing wings of the clean-tech market. Organic produce is booming, and grocery markets and organic growers, of course, can't use chemicals to kill fungi or bacteria.
Farmers, meanwhile, have been stung by spinach recalls. Municipal-water districts are currently going through upgrades of their systems. And consumers complain about the chemical taste of tap water.
As a result, companies such as AgraQuest have devised biopesticides while others, such as Novazone, have come up with ways to disinfect harvested food with ozone.
Ioteq claims that it has an advantage over ozone systems in capital cost. Its purification systems cost only $5,000 to $15,000, less than the equipment required for ozone treatment, he said. (Novazone has said its systems cost closer to $100,000, but the throughput of the systems is different. I'll try to do a more detailed comparison later.)
Interestingly, Ioteq doesn't make much money on the hardware. Instead, the profits come from selling iodine to its installed base. The iodine market, Franks added, is fairly stable. It comes from Chile and Japan, and the price doesn't fluctuate much.
Chlorine as a chemical costs less, he admitted, but Ioteq's Isan system needs fewer chemicals to get the job done. The Isan system needs only about 30 parts per million of iodine to clean fruit. Chlorine needs about 200 parts per million.
As they say in the water business, it's a wash at that point

How PCs lost their expensive cachet

perspective It was something to behold while it lasted. But as happens with nearly everything in life, the fad that was PC mail order has just about run its course.

Oh, you can still buy a computer direct--either by making a 1-800 telephone call or by logging onto a corporate Web site. But that's a world away from what I'm talking about.

It wasn't long ago that you could choose among scores of PC mail-order outfits making first-rate machines every bit as good as those offered by the IBMs and Compaqs of the world. And then there was Dell Computer and Gateway, two direct resellers in a class by themselves. Publicly traded companies with billions of dollars in annual sales--and billionaire CEOs to boot--they were lauded in countless business-magazine cover pieces extolling the latest turn in old-fashioned American entrepreneurship.

Say goodbye to all that.

After its most recent anno horribilis, Dell increasingly sees its future in retail.

Gateway, which stumbled its way into irrelevance for much of the last decade, now operates as an arm of Acer. As for the rest of that once-plucky cohort of no-name direct sellers, most are insignificant, at best, or fly-by-night operations at worst.

These days you have no excuse for getting ripped off. If you pay too much for a computer, it's your own fault.

Maybe all of this was foreordained. After all, how many multibillion-dollar industries can you find where mail order trumps retail distribution by a wide margin? But for a brief period, the mail-order crowd was to give the mainstream one helluva run for the money.

Like the tech enthusiasts and computer clubs that formed at the dawn of the personal computer era, that first crop of entrepreneurs was a unique bunch. A few accumulated fortunes. Some sold out before the good times ended. Many--maybe most?--ultimately went bust. But before they left the scene, direct-sales specialists like Gateway's Ted Waitt, Art Lazere at Northgate, Greg Herrick at Zeos, and of course Michael Dell, who's still at the helm of his eponymous company, were responsible for forcing computer makers to make machines that regular folks could afford.

If you recall, that wasn't always the case. In the mid-1980s a fully loaded PC XT or PC AT sold by IBM or clone makers like Compaq or AST Research cost several thousand dollars, depending upon the configuration. Those fat profit margins helped pay for a cumbersome distribution system that relied upon computer retailers.

Some computer resellers were very good at their craft. Companies like Businessland, Entre, and Inacomp went public and for a time did quite nicely. For the most part, however, the computer stores were fat and happy order takers. They got away charging big premiums because PCs were still a novelty for most people. If you wanted to buy a computer, what alternative did you have other than to build your own?

Now on News.com

Dell--not the PC maker you used to know Photos: Sheets of light flex and proclaim Photos: Toyota's mobile, musical robots Extra: IBM: Smaller, faster optics

The mail-order guys exploited that opening for all it was worth. At first, their rising popularity was mostly related to the lower prices they charged. In time, though, they became masters of improvisation and would learn how to beat the old-line computer companies in the new-features competition. At one point, Big Blue fell so far behind the mail-order makers that it panicked and started a separate direct-sales company based in Raleigh, N.C.

But you can stay dumb for only so long.

In time, the rest of the industry figured out how to squeeze inefficiencies out of their distribution systems and became far more nimble. The emergence of the Internet was the game changer. Big computer companies that previously avoided channel conflict like the plague seized upon the new technology. Relying exclusively on retailers no longer made sense. The new mantra: let the customer decide where to buy the product.

The dominos fell quickly. Direct vendors lost their advantage as every computer maker worth its salt now also was a direct vendor. The PC was always a commodity--only dressed up as something more than that. Now there is no returning to the days of Fat City. These days you have no excuse for getting ripped off. If you pay too much for a computer, it's your own fault.

Remember that next time you go shopping for a new PC. And while you're at it, how about a holiday note of thanks for the entrepreneurs who helped make it happen.

Wi-Fi 'illegal images' politician defends legislation

The Democratic sponsor of a bill forcing anyone with an open Wi-Fi connection to report illegal images--or pay fines of up to $300,000--says a recent Internet outcry over the legislation misses the point.

Rep. Nick Lampson, D-Texas

(Credit: U.S. House of Representatives)

Rep. Nick Lampson of Texas, who drafted the bill that the House of Representatives approved this week, said through a spokesman on Thursday that he didn't actually mean to target Americans who happen to have Wi-Fi access points at home. The legislation also covers social-networking sites, domain name registrars, Internet service providers, and e-mail service providers such as Hotmail and Gmail.

Lampson's spokesman, Trevor Kincaid, sent me this e-mail about the Securing Adolescents From Exploitation-Online Act, or SAFE Act:

It is NOT the intent of the SAFE Act to target Wi-Fi providers but rather the entities that provide the internet to those conduits.

With that said--child pornography is illegal, grotesque, and has become a global epidemic. The Internet serves as virtual hunting preserve for pedophiles and predators to prey upon innocent children. So, while this bill is not intended to impact the groups you reference, those groups, all of us, have a civic and moral obligation to report these criminal acts that exploit and traumatize children.

He responded to privacy concerns with this:

Since child pornography is illegal it is material that is NOT protected by the first amendment. Therefore, the SAFE Act is not infringing upon a person's civil liberties.

I wrote back:

You say that the "intent" was not to force Americans with open Wi-Fi connections in their homes, but a court will typically not consider congressional intent--it'll look at what the law says. Why does the bill not exempt Wi-Fi and private individuals from its relatively strict requirements?

Will you try to work with the Senate to tweak the language so it doesn't cover WiFi connections and private individuals? Because you said that he did not mean to target WiFi networks, can I take your response to mean that inclusion of such language was a mistake that will be fixed? I mean, it wouldn't seem to be a major change--just the addition of one sentence or so.

Kincaid replied:

I never said Rep. Lampson "didn't mean to target WiFi." Rep. Lampson added teeth to pre-existing law in hopes of cracking down on a $5 billion a year child pornography business.

We are constantly discussing the bill as it moves through the Senate, but I cannot speculate whether or not any changes will be made to the House version. Mr. Lampson's goal is to stop the trafficking of child pornography on the internet without dissolving civil rights; this bill will take big strides to accomplish that goal.

So what exactly does the SAFE Act do? It doesn't mandate ongoing network surveillance. What it does require is that anyone providing Internet access who learns about the transmission or storage of information about illegal image must (a) register their name, mailing address, phone number, and fax number with the National Center for Missing and Exploited Children's "CyberTipline" and (b) "make a report" to the CyberTipline that (c) must include any information about the person or Internet address behind the suspect activity and (d) the illegal images themselves. (Note that some reporting requirements already apply to Internet access providers under current law.)

The definition of which images qualify as illegal is expansive. It includes obvious child pornography, meaning photographs and videos of children being molested. It also includes photographs of fully clothed minors in unlawfully "lascivious" poses, and certain obscene visual depictions including a "drawing, cartoon, sculpture, or painting."

Most reasonable adults, including home Wi-Fi providers or the Web sites affected by this legislation, can figure out what actual child pornography is. But when it comes to photographs of fully clothed minors in "lascivious" poses, and overly risque cartoon anime that might be "obscene" in one area of the country and permissible in another, it becomes trickier--especially when, legally, only a jury can determine whether an image violates local community standards.

The real problem, I think, is that Lampson probably drafted this legislation a little too hastily. It didn't go through the normal committee process and was rushed to the floor without the final text being posted until the day after the vote. That may be why its requirements apply to anyone providing an "electronic communication service" or "remote computing service"--terms that were clear back when the only Internet service providers were AOL or Netcom.

But now that anyone with a Wi-Fi connection (or any school, or library, or coffee shop) can be an ISP, it's not sufficient to borrow definitions written in the 1980s. That's one reason why the usual back-and-forth process of public hearings, disclosure, and debate can actually be helpful on occasion.

Xbox, Gamefly beef up music offerings

Looking for ways to offset sagging CD sales at record stores, music industry looks to video games as method of distribution.

As record stores stock fewer music CDs, the music industry is turning to video games as an alternative method of distribution. Both Microsoft, developer of the Xbox 360 game console, and online game rental service GameFly introduced new music initiatives.

Microsoft has added downloadable music videos from Sony BMG to the Xbox Live Marketplace. Free promotional videos have been available on the platform since its November 2005 launch, but the new iteration adds a pay-to-download option featuring a far greater catalog.

More than 40 Sony BMG videos are available now, featuring artists like Alice In Chains, Audioslave, Dave Matthews Band, Foo Fighters, and more. Each video will cost 160 Microsoft Points (about $2).

Microsoft says this is merely the "first wave" of content, suggesting more videos from additional labels will appear at some point. The videos can't be transferred to Microsoft's Zune device, but company officials say that functionality is expected in the future.

Now on News.com

Dell--not the PC maker you used to know Photos: Sheets of light flex and proclaim Photos: Toyota's mobile, musical robots Extra: IBM: Smaller, faster optics

Meanwhile, GameFly has begun giving away five digital downloaded tracks a month to members of the online game rental service. GameFly and partner Brandracket--a music licensing and marketing agency--will select the five songs. Anyone visiting the GameFly Web site will get one of the songs, while only subscribers can access the other four.

The featured tracks will be a mix of emerging and established artists. Among those available at launch are songs from RJD2, Thievery Corporation, Shadows Fall, OK Go, and Little Brother.

GameFly is also adding artist bio, links to more artist information, and links to iTunes to buy additional tracks

O2 hopes to nab iPhone clients from rivals

head of O2, which won an exclusive deal to sell the iPhone in Britain.

"Over time, three out of four (U.K.) customers of the iPhone will be new O2 customers, because you can only get the iPhone by becoming a customer of O2," Matthew Key, incoming head of O2, told reporters in London.

Key declined to comment on how many of the music-playing and Web-browsing handsets had been sold since its launch on November 10, but sales in the first few weeks have been in line with expectations, he said.

O2 has previously said it sold tens of thousands of the handsets in its first weekend, but the company has never revealed the commercial terms of its agreement with Apple, in which revenue is shared between the partners.

Now on News.com

Dell--not the PC maker you used to know Photos: Sheets of light flex and proclaim Photos: Toyota's mobile, musical robots Extra: IBM: Smaller, faster optics

Key is to take over as the top O2 executive from Peter Erskine, who is stepping down at the start of 2008.

O2 aims to consolidate its leading position in Britain and to recoup ground in the German market.

"Over the next three years, there will be 8 million additional DSL customers in each of these two countries, and we intend to take quite a share of it," he said.

"There are small acquisition opportunities in Germany, in the retail business, and perhaps in distribution," Erskine said, addeding