May 2006

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GOVERNMENT & COMMUNICATIONS
Bush Aide Defends Eavesdropping on Phone Calls
Questions Raised for Phone Giants in Spy Data Furor
The Prevention of Fraudulent Access to Phone Records Act

SPECTRUM
More Spectrum, Please
FCC air-ground wireless license auction on hold

MEDIA OWNERSHIP
Hey, Time Warner: Walk Away From Adelphia
Do you own songs bought online? Well, sort of
Fighting Internet Piracy -- Plan B
Copyright Bill Would Target Download Devices

TELEPHONY/UNIVERSAL SERVICE
New Telephone Subscribership Report
New Telephone Report Focused on Income
New Report on how USF Changes could Harm America's Colleges and Universities
AOL: USF Linked to Phone Numbers Would Cause "Issues"
Telecom act rewrite targets rural America

TELEVISION
Let's Label "Canned" News Video
Local Franchises Get Local Support
Promo Slam
Television Technology Enters New Era
TV + the Web = ?

QUICKLY -- Adult industry welcomes .xxx domain rejection; Snap.com
Mingles Ads in Search Results

GOVERNMENT & COMMUNICATIONS

BUSH AIDE DEFENDS EAVESDROPPING ON PHONE CALLS
[SOURCE: New York Times 5/14, AUTHOR: Brian Knowlton]
President Bush's national security adviser, Stephen J. Hadley,
insisted Saturday that a newly disclosed government effort to compile
data on millions of telephone calls in search of terrorist-linked
calling patterns was a legal and "narrowly designed program" that did
not involve listening to individual calls. "The president has been
very clear that we are to pursue our intelligence programs within the
law," Mr. Hadley said, even as he declined to confirm details of the
telephone surveillance program operated by the National Security
Agency, which were reported Thursday by USA Today. Mr. Hadley's
comments came a day after Mr. Bush defended the program and days
before its architect, Gen. Michael V. Hayden, is expected to face
tough questioning about it during hearings by the Senate Intelligence
Committee on his confirmation as director of the Central Intelligence
Agency. General Hayden is currently deputy to the national
intelligence director. Some top lawmakers criticized the surveillance
program Saturday and said that whether General Hayden is confirmed is
likely to depend largely on how forthcoming he is during the
committee hearings.
http://www.nytimes.com/2006/05/14/washington/15intelcnd.html?hp&ex=11476...
(requires free registration)
See Also --
* Poll: 51% oppose call database
http://www.usatoday.com/printedition/news/20060515/1a_lede15_dom.art.htm
* Cheney Pushed U.S. to Widen Eavesdropping
http://www.nytimes.com/2006/05/14/washington/14nsa.html
(requires free registration)
* NSA's data mining explained
http://news.com.com/FAQ+NSAs+data+mining+explained/2100-1028_3-6071780.h...
* Negroponte Denied Domestic Monitoring
http://www.washingtonpost.com/wp-dyn/content/article/2006/05/14/AR200605...
* A Very Different America
http://www.tpmcafe.com/node/29821

QUESTIONS RAISED FOR PHONE GIANTS IN SPY DATA FUROR
[SOURCE: New York Times 5/14, AUTHOR: John Markoff]
A federal lawsuit was filed in Manhattan Friday seeking as much as
$50 billion in civil damages against Verizon on behalf of its
subscribers. The New Jersey lawyers who filed the federal suit, Bruce
Afran and Carl Mayer, said they would consider filing suits against
BellSouth and AT&T in other jurisdictions. "This is almost certainly
the largest single intrusion into American civil liberties ever
committed by any U.S. administration," Mr. Afran said. "Americans
expect their phone records to be private. That's our bedrock
governing principle of our phone system." In addition to damages, the
suit seeks an injunction against the security agency to stop the
collection of phone numbers. Legal experts said Verizon, AT&T and
BellSouth face the prospect of lawsuits seeking billions of dollars
in damages over cooperation in the National Security Agency program
to build a vast database of phone calling records, citing
communications privacy legislation stretching back to the 1930's. The
database reportedly assembled by the security agency from calling
records has dozens of fields of information, including called and
calling numbers and the duration of calls, but nothing related to the
substance of the calls. But it could permit what intelligence
analysts and commercial data miners refer to as "link analysis," a
statistical technique for investigators to identify calling patterns
in a seemingly impenetrable mountain of digital data. The law
governing the release of phone company data has been modified
repeatedly to grapple with changing computer and communications
technologies that have increasingly bedeviled law enforcement
agencies. The laws include the Communications Act, first passed in
1934, and a variety of provisions of the Electronic Communications
and Privacy Act, including the Stored Communications Act, passed in
1986. Wiretapping -- actually listening to phone calls -- has been
tightly regulated by these laws. But in general, the laws have set a
lower legal standard required by the government to obtain what has
traditionally been called pen register or trap-and-trace information
-- calling records obtained when intelligence and police agencies
attached a specialized device to subscribers' telephone lines.
http://www.nytimes.com/2006/05/13/washington/13phone.html
See Also --
* Lawsuit over phone records may grow
http://www.usatoday.com/printedition/news/20060515/a_nsa15.art.htm
* Phone market dominance permits two-tier Internet, NSA data mining,
other abuses
http://www.oreillynet.com/etel/blog/2006/05/phone_market_dominance_permi...
* Telecom firms distance themselves from NSA flap
http://news.com.com/Telecom+firms+distance+themselves+from+NSA+flap/2100...
* Qwest Goes From the Goat to the Hero
http://www.nytimes.com/2006/05/15/technology/15link.html
(requires free registration)

THE PREVENTION OF FRAUDULENT ACCESS TO PHONE RECORDS ACT
[SOURCE: Rep Edward Markey (D-MA)]
Last week, Rep Ed Markey wrote House Speaker Dennis Hastert asking
what has happened to a previously-scheduled vote on a bill, The
Prevention of Fraudulent Access to Phone Records Act, Rep Markey
co-sponsored. The bill, which passed with unanimous support from the
House Commerce Committee, addresses the privacy of American
consumers' phone records. Rep Markey asks about rumors that the House
Intelligence Committee sought to amend the bill with exempts for
"intelligence gathering activities." He wonders if there is a
connection between the bill's sudden disappearance and last week's
USAToday story about NSA's collection of phone records.
http://markey.house.gov/docs/telecomm/Letter%20to%20Hastert.pdf

SPECTRUM

MORE SPECTRUM, PLEASE
[SOURCE: Wall Street Journal, AUTHOR: Editorial Staff]
[Commentary] Politicians and regulators complain that broadband
deployment in the U.S. lags other developed nations. At the same
time, they conspire to devise policies that hamstring the domestic
broadband marketplace. A good example is Washington's approach to
allocating wireless electromagnetic spectrum. Allocating spectrum via
auction is certainly the most efficient way to go, and no one is
suggesting a return to lotteries and competitive hearings. Rather,
the problem is the infrequency of the auctions themselves and the
fact that the government is dragging its feet in getting more
spectrum into private hands. Policy makers reason that by pushing
auctions off they can starve the sector for some period, which
creates scarcity and artificially inflates the costs of the licenses.
The Congressional Budget Office expects the 3G spectrum auction
scheduled for next month to raise about $15 billion for the U.S.
Treasury, reflecting uncertainty about future auctions. But the
government's role here shouldn't be to maximize its revenue; the main
objective is efficient allocation of an important resource for
economic growth. "Congress is spending too much time looking at
auction revenues and not enough time looking at the gains to the
economy from having more productive use of spectrum," says Thomas
Hazlett, a former FCC economist who now teaches law and economics at
George Mason University. Regulators have tried to compensate for this
stinginess by allowing some 2G license holders to offer 3G services,
but this is at best a temporary fix. The better course is to stop
distorting the market by pretending that spectrum is a scarce
resource. Put as much spectrum as possible -- as quickly as possible
-- on the market and remove unnecessary government controls for how
it's used. Some incumbent wireless carriers will complain because
they don't want any new competition. But the government has no more
business protecting these incumbents than it has hoarding frequencies
that the market could put to better use.
http://online.wsj.com/article/SB114765100376952517.html?mod=todays_us_op...
(requires subscription)

FCC AIR-GROUND WIRELESS LICENSE AUCTION ON HOLD
[SOURCE: Reuters]
The Federal Communications Commission on Friday suspended until
Monday its auction of wireless licenses for Internet access and other
communications services aboard commercial airplanes. "The commission
paused the bidding to look at how the auction is proceeding," said
FCC spokeswoman Chelsea Fallon. After eight rounds of bidding, Unison
Spectrum has the highest offer of $4.5 million for a 3 megahertz
license while Space Data Spectrum Holdings has the top bid for the
other 1 megahertz license with an offer of $244,000. The auction will
end when none of the qualified bidders makes a new offer and does not
withdraw a previously provisional winning bid during a round. The
airwaves up for sale include those licensed to Verizon's Airfone
service, which offers service through phones embedded in airline
passenger seats. Consumers have balked at the Airfone service because
of its relatively high cost. The sale, however, would not mean
passengers could use their own cell phones during commercial flights.
The FCC and the Federal Aviation Administration are still weighing
whether to permit them to be used that way.
http://today.reuters.com/news/newsArticle.aspx?type=internetNews&storyID...

MEDIA OWNERSHIP

HEY, TIME WARNER: WALK AWAY FROM ADELPHIA
[SOURCE: Broadcasting&Cable, AUTHOR: John M. Higgins]
[Commentary] The sale of Adelphia Communications to Time Warner Cable
has dragged on for months. The deal breezed through antitrust review
long ago, but bickering among Adelphia's many creditors and gridlock
at the Federal Communications Commission threaten to push the deal
perilously close to its July 31 drop-dead date. The cancellation
deadline gives Time Warner Cable a chance to do something that makes
a lot of sense and would make many people on Wall Street happy: Walk
away. Time Warner does not need this deal. One major justification --
Time Warner Cable's need to get bigger to compete with giant
telephone companies -- is overblown. The financial gains from
bringing Adelphia's relatively weak properties up to Time Warner
Cable's standards could be far smaller than expected, a problem best
demonstrated by Time Warner's partner in the Adelphia bid, Comcast.
Comcast bought AT&T Broadband in 2002, orchestrated a remarkable
turnaround yet got no apparent reward in its stock price. If Time
Warner scuttles the deal now, breach-of-contract lawsuits will
commence. But if the creditor mess extends past the drop-dead date,
Time Warner could walk without penalty and -- under some
circumstances -- even pocket a breakup fee. Time Warner should keep
its powder dry. There will be other, more valuable deals down the road.
http://www.broadcastingcable.com/article/CA6334530?display=News

DO YOU OWN SONGS BOUGHT ONLINE? WELL, SORT OF
[SOURCE: Reuters, AUTHOR: Duncan Martell]
do you really own the tunes you buy online? It depends on how you
define ownership. "Owning implies control and if you bought the
tracks on iTunes you don't have complete control," said Rob Enderle,
president of market researcher the Enderle Group. Those songs you
bought online from Apple play just fine, of course, so long you do so
on the company's iTunes digital jukebox software, on an iPod, burn a
CD, or stream them wirelessly to your stereo using another Apple
gizmo. But Apple's FairPlay digital rights management, or DRM,
software prevents you from listening to those purchased songs on a
music player from Dell, Creative, Sony, or others. The same thing
goes for songs you've imported to your computer from CDs you already
own. The DRM software is Apple's way of preventing piracy and is a
large part of the reason why the recording industry has so warmly
embraced the iTunes Music Store. "A lot of people would argue it's
the closest thing you're going to get other than buying a CD," said
analyst Mike McGuire of market research firm Gartner of the
restrictions Apple and others place on music bought online.
http://today.reuters.com/news/newsArticle.aspx?type=technologyNews&story...

FIGHTING INTERNET PIRACY -- PLAN B
[SOURCE: Wall Street Journal, AUTHOR: Editorial Staff]
[Commentary] The entertainment industry has heretofore fought online
piracy primarily by shutting down Internet file-sharing networks and
suing the people who use them. So Warner Brothers' announcement last
week that it plans to start selling movies and TV shows via the
file-sharing model signals a significant change in strategy. Kevin
Tsujihara, president of WB's home entertainment division, told
reporters, "We've always known that peer-to-peer technology
represents a huge opportunity for us." Kudos to Warner Brothers for
seizing the opportunity.
http://online.wsj.com/article/SB114765064186252513.html?mod=todays_us_op...
(requires subscription)

COPYRIGHT BILL WOULD TARGET DOWNLOAD DEVICES
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
A pair of California representatives, Democrat Howard Berman and
Republican Mary Bono, have introduced legislation that would apply
copyright payments to devices that turn broadcasts into digital
downoads. "Certain features of the new devices bypass the marketplace
by allowing consumers to turn broadcasts into downloads,"said the
legislators in a statement announcing the new bill,"creating an
unlicensed music library without adequately paying the artist. The
PERFORM Act seeks the appropriate balance between fostering
innovation of technology and ensuring rightful compensation to
artists." PERFORM stands for Platform Equality and Remedies for
Rights Holders in Music. A similar bill has already been introduced
in the Senate.
http://www.broadcastingcable.com/article/CA6334619?display=Breaking+News

TELEPHONY/UNIVERSAL SERVICE

FCC RELEASES NEW TELEPHONE SUBSCRIBERSHIP REPORT
[SOURCE: Federal Communications Commission press release]
On Friday, the Federal Communications Commission released its latest
report on telephone subscribership levels in the United States. The
report presents subscribership statistics based on the Current
Population Survey (CPS) conducted by the Census Bureau in November
2005. The report also shows subscribership levels by state, income
level, race, age, household size, and employment status. In November
2005: The telephone subscribership penetration rate in the U.S. was
92.9%. The telephone penetration rate was 79.4% for households with
annual incomes below $5,000, while the rate for households with
incomes between $100,000 and $149,999 was 97.7%. Among the states,
the penetration rates ranged from a low of 86.8% in Georgia to a high
of 97.0% in Utah. Households headed by whites had a penetration rate
of 93.9%, while those headed by blacks had a rate of 86.7% and those
headed by Hispanics had a rate of 89.2%. Penetration rates ranged
from 86.1% for households headed by a person under 25 to 95.2% for
households headed by a person between 65 and 69. Households with one
person had a penetration rate of 90.0%, compared to a rate of 94.1%
for households with four to five persons. The penetration rate for
unemployed adults was 89.7%, while the rate for employed adults was 94.2%.
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-265353A1.doc
Full report: http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-265356A1.pdf

FCC RELEASES TELEPHONE PENETRATION BY INCOME REPORT
[SOURCE: Federal Communications Commission press release]
On Friday the Federal Communications Commission released a report
presenting data on telephone penetration levels on a state-by-state
basis for various income categories. The report presents penetration
statistics based on individual household data from the Current
Population Survey (CPS) conducted by the Census Bureau in March 2005.
This report, which is updated annually, provides more detailed
information on telephone penetration to complement the information
available in Telephone Subscribership in the United States, which is
published three times a year. Specifically, this report is designed
to track the effects of federal and state Universal Service Fund
Lifeline and Linkup support mechanisms that defray the cost of
telephone service for low-income consumers. In March 2005,
penetration among low-income households nationwide was 86.4%. This
contrasts with an overall nationwide penetration rate of 92.6% in
March 2005. Since 1985, when the FCC first established Lifeline to
help low-income households afford the monthly cost of telephone
service, penetration rates among the lowest income households (under
$10,000 annual income in 1984 dollars) have grown from 80.0% to
86.4%. States that have provided a high level of lifeline support for
telephone service for low-income consumers experienced an average
growth in penetration for low-income households from March 1997 to
March 2005. In contrast, states that provided a low level of
lifeline support experienced an average decline in telephone
penetration rates for low-income households between March 1997 and
March 2005. Penetration rates among low-income households ranged from
a high of 95.2% in Vermont to a low of 78.4% in Mississippi in March 2005.
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-265357A1.doc
Full report:
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-265358A1.pdf

FLUNKING NUMBERS: HOW CHANGING USF WOULD HARM UNIVERSITIES
[SOURCE: The Keep Universal Service Fund Fair Coalition]
The Keep Universal Service Fund Fair Coalition has released new
research. Based on an American Council on Education (ACE) review of
potential USF contribution
hikes for a representative cross-section of 15 U.S. colleges and
institutions, it appears that the average college and university
would see its USF phone bill rise from an average of $8,971 per year
to $82,999, an average increase of 892 percent. Applying the ACE
analysis to the wider group of 4,325 colleges and universities in the
United States results in an estimated total annual USF contribution
increase of $320 million-$480 million per year, with the latter
dollar total pegged to the more likely $1.50-per-line USF fee needed
to sustain the Fund at its current level.
http://telephonyonline.com/access/regulatory/fcc_usf_coalition_051206/

AOL: USF LINKED TO PHONE NUMBERS WOULD CAUSE "ISSUES"
[SOURCE: VON Magazine, AUTHOR: Doug Mohney]
senior AOL executive said charging a Universal Service Fee (USF)
per phone number would cause some "issues" in the company's efforts
to give away free phone numbers as a part of their AIM Phoneline
voice service. "We don't want to see that (USF) dollar service charge
as something that has to be added to something for free," said AOL
Vice President Alex Quilici. "That would actually change the business
model." Quilici said he believed that the proposed USF "phone number"
fee would be around a dollar per phone number per month. He said free
phone numbers through AOL's free Phoneline service would actually
provide a form of universal access. In combination with a free
broadband connection, "this does become universal, by providing a
free phone service on top of their free broadband connection,"
Quilici said. "We don't want the service to cost a dollar."
http://www.vonmag.com/webexclusives/2006/05/11_AOL_USF.asp

TELECOM ACT REWRITE TARGETS RURAL AMERICA
[SOURCE: Alaska Journal of Commerce, AUTHOR: Melissa Campbell]
A look at what the Universal Service Fund means to Alaska -- and how
Senate Commerce Committee Chairman Ted Stevens (R-Alaska) addresses
USF problems in his telecom reform legislations.
http://www.alaskajournal.com/stories/051406/hom_20060514005.shtml

TELEVISION

LET'S LABEL "CANNED" NEWS VIDEO
[SOURCE: Broadcasting&Cable, AUTHOR: Diane Farsetta, Center for Media
and Democracy]
[Commentary] Last month, the Center for Media and Democracy released
a report documenting how TV stations across the United States use
video news releases (VNRs). The responses we've received from TV
stations confirm what we all know -- what the Project for Excellence
in Journalism, among others, has reported: TV newsrooms are being
asked to do more with less, so they're increasingly turning to
"provided" video. But we're also hearing, time and again, that
newsroom staff are confused as to the origins of such video. So, in
contravention of station policies, journalistic codes and possibly
even FCC rules, stations air VNRs without disclosing to their viewers
that the video was funded by and scripted for clients with particular
-- ally monetary -- interests in the topics covered. As we noted in
our report, the PR firms that produce VNRs name their clients in the
opening slates and in accompanying materials. What can be done to
clear up newsroom confusion, then? We recommended that the FCC
require continuous on-screen disclosure of the source of provided
and/or sponsored video. A viewer's right to know where her or his
news comes from must be respected. Disclosure is not some lofty
ideal. It's something newsrooms (especially those using the public
airwaves) simply must provide. And until disclosure is the rule --
instead of the exception, as it is currently -- VNRs will continue to
be controversial.
http://www.broadcastingcable.com/article/CA6334593?display=Opinion

LOCAL FRANCHISES GET LOCAL SUPPORT
[SOURCE: Multichannel News, AUTHOR: Kent Gibbons]
[Commentary] The nation's biggest phone companies have excellent
lobbyists in Washington, working hard to see to it that their clients
don't have to go city by city, across the country, negotiating entry
into the video business the way cable companies had to do it. The
cable companies, not wanting any such legislation to make life easier
for their telephone rivals, have some interesting allies who've taken
their side. On the steps of City Hall in Manhattan last week, those
allies included organizations that: Aid sweatshop workers in
Chinatown; Assist apartment renters in disputes with landlords; and
Provide training to city residents eager to learn the TV-production
business. Representing the last category were officials from the
city's public-access TV corporations, and they brought all three
categories together by providing a platform for documentary programs
and call-in information shows that potentially reach millions of
cable-TV watchers. City council members who backed an
anti-national-franchising resolution that passed, 50-0, the same day
as the rally had more than public-access TV on their minds
-- namely, the $81 million per year that Time Warner Cable,
Cablevision Systems and RCN pay in fees under the franchise contracts
that provide for the 16 public, education and government channels in
the city's five boroughs, plus other perks like an institutional
communications network. Cable companies have backed some grassroots
anti-telco lobbying efforts, but no cable people were in evidence at
City Hall. Yu of MNN said some individual cable executives have
voiced support for their efforts at public hearings. But last
Wednesday's event was an example of local groups that needed no
separate funding to get local elected officials on their side. It
just remains to be seen how much collective influence actions like
the City Council's unanimous vote last week will have on heavily
lobbied representatives in Washington.
http://www.multichannel.com/article/CA6334330.html?display=Opinion

PROMO SLAM
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
[Commentary] Benton Foundation President -- and former FCC
Commissioner -- Gloria Tristani appeared on CNN Friday to encourage
viewers to complain to TV stations and the FCC, and to better monitor
the TV themselves. What about? Promos for adult-targeted prime time
shows that air throughout the day when kids are likely to be
watching. CNN's segment included psychologist Sylvia Rimm, who has
written a book about how the media culture, particularly sexual
images and themes, has stolen the innocence from middle schoolers.
But CNN also included an erroneous claim that the FCC has no
oversight over ads, suggesting that there was no governor on promos,
as there is with other programming. Wrong. One of the recent proposed
indecency fines was against the ad, and the FCC confirms that an
indecent promo, essentially a house ad, is within its ambit. In fact,
one of its recent proposed indecency fines targeted an ad, though as
far as I can tell it was the first one ever cited for indecency.
http://www.bcbeat.com/?q=node/1303

TELEVISION TECHNOLOGY ENTERS NEW ERA
[SOURCE: The Epoch Times]
In February of 2009 all television stations in the United States are
required to convert to digital transmission. This move will bring an
end to traditional analog television that has been the standard for
decades. The television industry is optimistic the costly transition
will be successful. One of the biggest supporters of the conversion
from analog to digital is the Washington, D.C.-based National
Association of Broadcasters. Spokesperson Dennis Wharton says that
only 200 American TV stations have yet to make the
conversion. "There are about 1,700 TV stations in the United
States," he noted. "Over 1,500 have already made the digital
television transition. Which means they are either simulcasting a
digital signal along with their analog signal, but most of them are
doing High Definition television during a lot of the day parts. Most
of prime time, for example, is in High Definition television; all of
the major sporting events are in High Definition television, late
night shows are all in High Definition television. I'm not going to
be Pollyannaish and not admit that there are some challenges still to
go, but considering where we were and where we are now, things are
going great." Mr. Wharton says the biggest problem has been the
cost, especially to stations that serve smaller population areas. He
estimates a basic conversion from traditional analog to what is
called SDTV (Standard Definition digital television) costs a station
at least $2 million. To go all HDTV with good equipment can push that
price tag up to $10 million.
http://www.theepochtimes.com/news/6-5-13/41524.html

TV + THE WEB = ?
[SOURCE: Wall Street Journal, AUTHOR: Sarah McBride sarah.mcbride( at )wsj.com]
These days, people are spending as much time in front of a computer
as a television -- in some cases, even more. And for television
companies, embracing the Internet -- for distributing existing shows
as well as for creating new content -- may no longer be optional, but
essential. Advertisers, meanwhile, are beginning to follow networks
and viewers online. For viewers, this obviously means lots of new
choices -- more shows to watch and more say in when you watch them.
But the Web also gives the public something more subtle: creative power.
http://online.wsj.com/article/SB114727128370548918.html?mod=todays_us_th...
(requires subscription)

QUICKLY

ADULT INDUSTRY WELCOMES .XXX DOMAIN REJECTION
[SOURCE: C-Net|News.com, AUTHOR: Ingrid Marson]
On Wednesday, the Internet Corporation for Assigned Names and Numbers
(ICANN) voted against the proposal, which would have led to the
creation of an .xxx domain suffix for pornography sites. Conservative
groups in the U.S., such as the Family Research Council, have
welcomed the decision. Some in the adult industry are equally happy
about the decision. Adult-industry observer Scott McGowan, in an
article on the EyeOnAdult Web site, said he "just couldn't be
happier." He claimed that ICM Registry, which proposed the new
top-level domain, was driven purely by the desire to make money.
http://news.com.com/Adult+industry+welcomes+.xxx+domain+rejection/2100-1...

SNAP.COM MINGLES ADS IN SEARCH RESULTS
[SOURCE: Associated Press]
Internet search engine Snap.com is hoping to expand its sparse
audience by making Web surfing more like channel surfing on a TV, but
the start-up might attract more attention with another change that
further blurs the lines separating ads from listings retrieved by
objective formulas. Under a new format to be unveiled today, Snap
will lump search results financed by advertisers in the same column
as non-paid Web links that are the most relevant responses to a
user's request.That combination is a departure from the practices of
leading Internet search engines such as Google Inc., Yahoo Inc. and
Microsoft Corp.'s MSN, which isolate advertising results in shaded
boxes at the top of the page or group them together in a separate
stack to the right under the heading "sponsored results." The
distinctions are meant to comply with Federal Trade Commission
guidelines urging that Internet search engines provide "clear and
conspicuous" distinctions separating their noncommercial results from
ad-driven links.
http://www.latimes.com/business/printedition/la-fi-search15may15,1,46062...
(requires registration)
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