Last updated: 9/30/99
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The Internet In the News
September, 1999

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Amazon.com, the online bookseller, announced that it would expand to a general online mall to be called zShops, offering a wide range of merchandise. Jeff Bezos, the founder and owner of Amazon, said they would sell "anything, with a capital A". Amazon will become like a mall, because other merchants will sell most of the merchandise, at sub-sites on the Amazon site, paying fees and distributing their own merchandise. Amazon said it would charge $9.99 per month for listings, and 4.75% for handling credit-card transactions. Amazon would retain control of the data on customers' browsing and buying patterns. Since this would cover a larger number of customers and products, it would presumably become more valuable. On the other hand, zShop merchants would be able to use Amazon's innovative online marketing techniques, such as buying circles. zShops will open with 500,000 products, four times as many as the average KMart. (New York Times, 9/30/99, Pg A1)

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America OnLine (AOL) is opening Internet Service Provider (ISP) services in Hong Kong, with a partner, China.com. Assuming that things go well in Hong Kong, China could be the next step. However, given the statement by a high Chinese official that foreign investment in ISPs would not be allowed, China is a risky market for outside investors. (New York Times, 9/30/99, Pg C4)

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New online merchants are expected to provide quick results. Competition is fierce, so companies want shoppers to have strong memories of the company name. If customers go to the computer without remembering the company name, the customer has so many other easy choices that sales are probably lost. Consequently their advertising tends to be offbeat and more willing to risk offending readers, or even to seek to offend them. One advertising firm who works with online merchants said, "Whoever shouts the loudest comes out on top." Another factor pushing advertising in this direction is that often, customers are young and respond well to bizarre ads. One example was a shot of a high school marching band forming the name of the company, and then being attacked by wolves released in their midst. Why the wolves? 'To get viewers "to remember our name."' (New York Times, 9/30/99, Pg C8)

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Bell Atlantic, the largest of the "Baby Bells" created as part of the AT&T breakup fifteen years ago, has a good chance of having its application to offer long-distance  services in addition to its local phone service, offering the first "one-stop" telephone service since the breakup. Previous Baby Bell applications to offer long-distance service have been denied on the basis that those companies had not yet opened up their local wiring to competitors for local telephone services. Bell Atlantic has gone through a difficult and public series of tests to open its local lines to other phone companies. The tests were specified in the Telecommunication Act of 1996, and run in cooperation with the U.S. Justice Department and the New York Public Service Commission. If approved, the ability to offer long distance service would let Bell Atlantic offer integrated packages of local, long distance, wireless and Internet services. The national long-distance company AT&T has spent $90 billion to go the other way, expanding its long distance business into local service, by acquiring the cable companies TeleCommunications Inc. and Mediaone Group Inc, and expanding its technology to offer local telephone service and Internet access over cable wiring. (New York Times, 9/29/99, Pg A1)

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The U.S. Securities and Exchange Commission filed charges against 68 companies for accounting fraud. For at least some charges, settlements were announced simultaneously. One set of charges was against Fran Tarkenton, former National Football League quarterback, who agreed to pay more than $150,000 to settle charges that he falsely reported profits for Knowledgeware Inc, which he owned at the time (1993 and 1994). Revenues for software sales to resellers were reported, even though the resellers were assured that they would not have to pay if they could not sell the software. Another set of charges against a well-know individual was against Ronald M. Cankes, former president of Christian Dior Perfumes, who had denied knowing about payments he received for providing supplies of perfume to a distributor. Both of these sets of charges have been accepted and settled, but other charges were being argued. (New York Times, 9/29/99, Pg C1)

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The traditional banking firm Chase Manhattan Corp said that it would buy Hambrecht and Quist,which focuses its business on Silicon Valley entrepreneurs. the price was $1.35 billion. Chase had been talking about making an acquisition to get into the Net economy, but has so far only been able to acquire only this relatively small firm. (New York Times, 9/29/99, Pg C1)

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The Intel Corporation, the U.S. leading manufacturer of microprocessor chips, including the "'86" and Pentium series, said that it would set up a web hosting business, which would offer hardware, software and services to other companies wanting to set up web sites. Intel set it would invest $1 billion in this business. (New York Times, 9/29/99, Pg C1)

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The number of cellular phones in Italy surpassed the number of wired phones last year, leading the Italian firm Olivetti S.p.A. to redistribute the businesses of its subsidiaries Telecom Italia and Tecnost along these divisions. (New York Times, 9/29/99, Pg C4)

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Foundry Networks Inc builds Internet switches that large Internet sites use to steer traffic in the most efficient manner. It went public yesterday, selling stock in itself for the first time (Initial Public Offering, or I.P.O.) as one of the few Internet businesses to actually make a profit. Its shares rose 525% during the day, nearly setting a record. (New York Times, 9/29/99, Pg C12)

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Network Solutions has had an exclusive license from the U.S. government to sell Internet Domain Names. Now, the government wants to open this business up to competition. Yesterday, Network Solutions agreed to these arrangements. Network Solutions will continue to maintain the central database, and will service domain names sold by other companies, charging a bulk rate of $6, contrasted to the $35 it charges for retail sales. On a test basis, eleven other companies are already selling domain names. Prices have not fallen very much, but up to sixty companies, including America OnLine (AOL) are eventually expected to enter this market, and prices are expected to fall substantially. Network Solutions will offer free public access to its database but be free to charge corporations for bulk access, and will retain control over the prestigious "com" domain name. (New York Times, 9/29/99, Pg C12)

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Alaska Airlines, the first airline to offer online eTickets, will also be the first to offer online check-in. Passengers will be able to check in from home or elsewhere, at least one hour of flight time on the day of the flight. Passengers will print out their own boarding pass. Initially this service will be offered only to those who have bought eTickets directly from Alaska itself, but will eventually be offered to all eTicket purchasers. (New York Times, 9/29/99, Pg C12)

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Students in elementary and secondary schools have growing access to computers and the Internet, according to a survey conducted by Education Week. Only about 10% of U.S. schools remain to be connected to the Internet, and the number of students per Internet-connected computer fell from 19.7 in 1998 to 13.6 this year. Teachers continue to complain that they do not have enough affordable suitable software to integrate the computers and the Internet into their courses. Teachers also complain that classroom computers were often not powerful enough to run the best software. Last year, a survey by the Educational Testing Service, conducted for Education Week, found that, particularly in middle school mathematics, access to computers could significantly improve academic performance. (New York Times, 9/29/99, Pg C26)

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A Federal appeals court ruled that creators of individual electronic works do not loose their intellectual property rights if their work is included in an electronic database or anthology, unless they have signed a contract that effectively gives up these electronic rights. This is a different outcome than would be expected for hard-copy anthologies, where included works are often edited or typeset. In that situation, creators of the anthology have more rights over the included works. (New York Times, 9/28/99, Pg C1)

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Laptop computers, video games, communications terminals, and increasingly, desktop monitors, all use flat-screen LCD displays. These displays have grown in speed and the ability to display bright colors. No, the Asian manufacturers of LCD displays can only deliver 80% to 90% of their orders. One factory in Japan is described which operates around the clock, and workers have not had vacations in over a year. Still, the factory is unable to keep up with orders. (New York Times, 9/28/99, Pg C1)

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IBM won a contract with the computer manufacturer Dell to supply networking and system integration services for Dell. Such onsite support is now an important factor in corporate computer sales. Dells' rival, Compaq, had earlier bought the manufacturer Digital Equipment Corporation (DEC) largely to acquire DEC's ability to provide these onsite services, and the contract with IBM will make Dell more competitive. IBM also sells computers in the corporate market and provides such services for its own customers, but this will be an additional source of business for IBM. (New York Times, 9/29/99, Pg C7)

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Eglobe Inc provides Internet voice communications in Asia and Latin America. Trans Global Communications provides Internet voice communications in the Middle East. Eglobe will buy Trans Global to merge these networks. (Both companies also supply other Internet services.) (New York Times, 9/28/99, Pg C4)

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British Internet modem-based subscribers pay by the minute, even for local phone calls. Therefore, free Internet Service Provider (ISP) are important in this market. America OnLine announced that it would lower its monthly subscription charges to become more competitive with services that only charge for the call, such as Freeserve PLC. (New York Times, 9/28/99, Pg C4)

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The United Nations Trade and Development Agency said that all international trade grew by 40% last year, to $644 billion, largely due to increases in mergers and acquisitions. (New York Times, 9/28/99, Pg C4)

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CBS Corp bought a 40% share of Women's Consumer Network (www.womensconsumernet.com), a membership consumer service site for women which provides career, financial and family advice to women, and negotiates on behalf of its members for discounts. (New York Times, 9/28/99, Pg C7)

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Fidelity Investment and the Internet portal Lycos announced a partnership yesterday, through which Lycos would provide online investor services for Fidelity's customers. The joint project will be called Powerstreet, and has been added to the web site Fidelity.com. (New York Times, 9/28/99, Pg C7)

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Sony will be selling a hand-held Walkman that will download music from the Internet, while obeying copyright laws. The new Walkman, to sell for $430, would not download music from free web sites. (New York Times, 9/28/99, Pg C12)

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A new book, a toll-free help line (800-633-4227) and a web site (www.medicare.gov) are being provided for senior citizens and their children is working through the available choices in health care, which have mushroomed in the past few years. It is not clear that all senior citizens will be able to make rational choices in their best interests; they may be senile, or simply lack the energy needed to study and weigh the alternatives. Economic theory says that choice is good, but consumers are often annoyed by the necessity of understanding and deciding among alternatives. (New York Times, 9/27/99, Pg A1) (Some recent examples are choosing a telephone service and service plan or choosing an Internet Service Provider, and soon in choosing among suppliers of electrical power.)

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Nike has become the first manufacturer of athletic shoes to allow an exclusively online store to sell its products. In this case, the store is Fogdog, and the price was to allow Nike to purchase 12% of Fogdog. Nike said that it felt that it had allowed to many brick-and-mortar retailers to carry its products, and it wanted to avoid this on line, and so making the right choice was important. It wants to choose merchandisers who will properly present Nike products to the consumer. (New York Times, 9/22/99, Pg C1)

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The Tokheim Corp, the US's largest manufacturer of gasoline pumps, will soon begin selling pumps with online connections that gas stations can use as they want. At least some possibilities are (a) to advertise products for sale in the station itself, (b) let busy customers check their email while filling up, and (c) let customers order from an adjacent fast food franchise, for delivery to the pump. (New York Times, 9/29/99, Pg C4)

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The co-founder of an Internet clearinghouse for Y2K problems (www.cassandraproject.org) has quit the project in order to focus on individual and community-group Y2K preparedness. Paloma O'Riley said that recent optimistic statements about Y2K readiness dealt too exclusively with corporations and large institutions. (New York Times, 9/27/99, Pg C4)

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eCommerce companies often concentrate on sales, and leave order fulfillment to a specialist firm. But this means that they lose control over critical elements in customer satisfaction such as fulfillment accuracy and the time between placing the order and receiving the goods. Customers are also increasingly demanding information about stock levels and availability, which requires shipping companies to be closely wired into the sales operation. Order fulfillment specialists have significant economies of scale (bigger is better), in contrast to online stores, who often try to be lean and avoid large up-front investments. As online stores try to widen their offerings in order to become more competitive, shipping often involves several suppliers, making the situation harder to manage. The rise of fulfillment as an issue in online retailing is resulting in a new respect for what used to be "the guys out back in the dirty suits." (New York Times, 9/27/99, Pg C4)

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America OnLine (AOL) recently bought its #2 rival, CompuServe. AOL's plan is that it sees the Internet Service Provider industry as shaking out to several levels or brands. It wants AOL to be the premium brand, with proprietary services such as its highly popular instant messaging, and CompuServe to the its value-conscious brand. CompuServe has recently shown an increase in customers, due primarily to its rebates of up to $400 for the purchase of a computer, along with a 3-year CompuServe subscription for $21.95 per month ($790.20 over the life of the contract). AOL predicts that eventually there will be several intermediate brands in addition to these two. Competitors say that CompuServe cannot be covering its costs, but CompuServe says that it is, thanks to its sharing AOL's equipment. (New York Times, 9/27/99, Pg C6)

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A new type of software to tutor children in learning to read has been patented by Project Listen at Carnegie Mellon University (www. cs.cmu.edu/~listen). Prof. Jack Mostow, project leader and recipient of the patent along with a graduate student, says that the software has stored text which it displays on the screen, and it then digitizes and analyzes the user's speech as the text is read. The software listens for mistakes in reading comprehension and informs the user using pre-recorded speech. In tests sponsored by the National Science Foundation, six elementary school children having trouble with reading, made two year's reading progress in eight months of using the system. The advantages of the computer system, according to Mostow, are that is always patient, and students are not embarrassed as they might be with a human tutor. This type of computer system has an advantage in that, since it present the text, it know what it should hear, within normal human variations in speech. (New York Times, 9/27/99, Pg C8)

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Arthur Levitt, chairman of the Securities and Exchange Commission called for an electronic system to display all orders to buy and sell stocks, over all stock exchanges. He said that new developments, including online after-hours trading, meant that existing systems no longer displayed all orders, meaning that investors could not get a complete picture of share prices. Levitt stressed that he was not calling for a central trading location, adding that existing exchanges should continue to regulate and police themselves. (New York Times, 9/24/99, Pg A1)

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America OnLine (AOL) and ICQ offer instant messaging, in which you can create a circle of friends and send instant messages to them, that pop up onscreen. Due to their popularity, other companies have added these to the work environment. Microsoft and Yahoo have been in an argument with AOL to allow instant messages to cross ISP boundaries. In the office, instant messages can be disruptive, and are not proving to be as popular as in the original home environment. (New York Times, 9/23/99, Pg D3)

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Unisys, which own the rights to the compression algorithm used in the .GIF graphics file format, has announced a new policy, requiring producers of .GIF graphics to obtain a $5,000 license. This has provoked much criticism in newsgroups and other online forums. Unisys says that it does not plan to prosecute small web sites. (New York Times, 9/22/99, Pg D3)

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A web-based system to control appliances remotely was announced by X-tra Web (www.x-traweb.com). Each appliance would be wired to an X-Node controller (about $25 each) and all of the X-nodes in a house would be connected to an X-Gate (about $150), which acts as an Internet Gateway and connects the set of X-Nodes to the Internet, where they can be controlled or observed remotely by the homeowner using a web browser. It is expected that the system will also be used by vending machine companies, fast-food franchises, and other companies with equipment in the field. (New York Times, 9/23/99, Pg D3) (Passwords, anyone?)

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For several months, Carlos Periera, a Portuguese hacker, and an Australian pornography web site, Taboosister.com, "page-jacked" legitimate web sites run by companies such as Audi and Paine Webber. When users of the Alta Vista search site clicked on links to such sites, they would be taken instead to the pornography site. The method involved copying the parts of the legitimate web pages used by Alta Vista for indexing (the "keyword" tags) and then tacking on the pornography pages (in the "body" section). Alta Vista would put the altered pages in the list of links when the search turned up the subject pages. The hacker also was able to disable the browser's "Back" button, perhaps by using a Java script. The pornography web site was raided by Australian and American authorities, and an American court order to stop the page-jacking was obtained. American authorities were involved because American citizens and companies were victims. The page-jackers could make money from this effort in three ways: (a) by higher advertising rates from other pornography sites, based on the amount of traffic, (b) by offering viewers more pornography for payment, and (c) by auctioning off the domain names at higher rates, based on the amount of traffic. While the hacker cannot be found at this time, the federal judge in Virginia issued an order permitting a summons to be served via email. (New York Times, 9/23/99, Pg A1)

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A.C. Nielsen, the TV rating company, said that would buy ten percent of Netratings to form a joint venture for measuring audiences on the web. (New York Times, 9/23/99, Pg C14)

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This summer, Bell Atlantic, one of the local "Baby Bells" created by the breakup of the Bell Telephone Company, and Vodafone, an English telephone company, competed to buy Airtouch, a US cellular company. Vodafone won the bidding war. Now, Bell Atlantic and Vodafone Airtouch have agreed to form a joint wireless network to become the largest US cellular company, almost twice as large as AT&T. (New York Times, 9/22/99, Pg C1)

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Fashion houses such as Gucci and Christian Dior so far have not gone online. One reason is that graphics are not detailed enough, but this will change soon. Also, virtual reality will soon offer customers to get views of models, and to see what they would look like in clothing. However, scarcity is another factor in high fashion prices, and going online will mean that anybody can by that high-fashion coat or handbag. Another reason is that fashion relies on retailers and is unlikely to want to compete with retailers directly. (New York Times, 9/22/99, eCommerce Pg 4)

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eCommerce is attracting many retailers, but the big winner is likely to be the customer, as competition ratchets up another notch. Firms that want to be major online retailers are giving discounts and coupons, driven by the conviction that being first establishes loyalty with customers. (New York Times, 9/22/99, eCommerce Pg 1)

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Higher Education is rushing to offer eCommerce as coursework, certificates, majors, minors, fellowships and research centers. Some programs focus on technology, such as web-site design, electronic data exchange and authentication technology, marketing and customer service, while others focus on business basics such as running a web business, entrepreneurship and tracking costs, revenues and inventories. While many colleges and universities are jumping on the eCommerce bandwagon, others are belittling it as a fad, arguing that it should be integrated into the normal business curriculum. There are enough faculty willing to teach these courses, and students eager to sign up for them. (New York Times, 9/22/99, eCommerce Pg 12)

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In a survey released this July, the US Commerce Dept found that the digital divide, the divide between those using the Internet and those who are not, is widening and is on its way to becoming a "racial ravine." Even at the same income levels, a low-income white family is three times more likely to have Internet access than a low-income black family, and four times more likely than a low-income Hispanic family. That this, if continued, would cause minorities to become less competitive in school and the workplace, will the rise of eCommerce also mean that minorities would be trapped in brick-and-mortar stores with higher prices and less choice? Experts say they are confused, because the recent availability of low-cost computers and online services was expected to narrow differences. African-Americans have adopted cable and satellite TV, but not the computer and the Internet. B. Keith Fulton, director for technology programs and policy at the National Urban League, says that this is a new challenge for civil rights. He said that there are two theories commonly invoked to explain the divide. One theory says that new technology has often been to the disadvantage of African-Americans, and so they tend to distrust new technologies. According to this theory, African Americans are substantial users of cellular phones and cable TV because these are know, proven technologies. The second theory holds that African American schools are not as well equipped, and the teachers not as well trained, so children in these schools do not demand that the family go online. Professor Donna L. Hoffman, professor of management at Vanderbilt University, said that another possibility is that African-Americans see little on the Internet to interest them personally. www.bet.com, a web site catering to African-Americans, will test this when it goes online this Fall, but other online retailers say that they have found it difficult to draw African-American shoppers. (New York Times, 9/22/99, eCommerce Pg 12)

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Doubleclick.com has grown into a leader in the Internet advertising business from its start four years ago. It serves advertisements for other web sites, using its own Dynamic Advertising and Targeting system (DART). When a user clicks into a Doubleclick client's site, that alerts DART to search its central inventory of ads for one tailored to this user. The choice is based on 22 criteria involving the user's Internet address, the time of day and others. Sometimes a cookie is dropped onto the user's computer to check on later visits whether or not this is a repeat user. In print advertising, there are many variables with little data about users, and consequently many competing theories of what makes advertising effective. On the Internet, much more information about customers is available -- do they click off, do they view the ad, do they buy from it, and how long do they spend looking at it, for example. The industry sees unresolved issues ahead, such as their right to own and use this data, both at the statistical and the individual levels, and who in fact does own it? And, will the ad server companies, such as Doubleclick, with their control of the data, gain more power than the advertising companies for which they work? (New York Times, 9/22/99, eCommerce, Pg 14)

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The increase in eCommerce can be assumed to be followed by an increase in eCrime. On piece of advice from law enforcement and security experts is to use a credit card for all online purchases. Compared with other methods, such as checks and cash, credit cards offer the protection of being able to dispute the bill before paying it, and limiting charges to $50 if the number is stolen. The National Consumers League reports that the riskiest online purchases are those through online auction houses, in which the goods were never delivered. The best-know case is that of James R. Denlinger Jr, who is charged with selling Beanie Babies but never delivered. The site always insisted on payment by check or money order, and used names that could easily be transformed into his own (e.g. Ian Oerlin). Some auction houses, such a Ebay, offer fraud insurance, and use customer ratings. (However, Mr Denlinger, among others, used other email addresses to give himself rave reviews.) the biggest risk is online identity theft, but this can be protected against with encryption technology. While no encryption is impossible to crack, it is rarely worth the considerable effort. It is easier to swipe credit card numbers in a restaurant, or by eavesdropping on a catalog line. Dorothy E. Denning, a computer science faculty members at Georgetown University, has cataloged computer crimes in her book, Information Warfare and Security, but still says that she has no hesitation in buying books online. But one example is of a ring of people who emailed a "Trojan Horse" that transmitted all of the user's keystrokes, giving access before the credit card numbers were encrypted. (New York Times, 9/22/99, eCommerce Pg 19)

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Sales taxes are highly inconsistent from locality to locality. A can of soda is taxable as nonfood in Ohio, but in New York is food and therefore nontaxable. Today, there are 46 states, 4,831 cities, 1,511 counties and 139 schools and other jurisdictions that collect sales taxes, according to Robert Cline, a sales tax expert at Ernst & Young, a major accounting firm. Other figures are much higher. However, even this lower number is a problem, because three customers in the same zip code could owe taxes at three different rates. Customers who have items sent by mail do not owe sales tax, but they do owe a use tax, which equivalent of a sales tax, but no state makes a serious effort to collect use taxes. Electronic information transport creates new issues as well. Suppose a resident of Buffalo downloads a temporary copy of an electronic book while on an airport stopover   in Pittsburgh, and goes on to read the book at his/her destination in Oregon. Which locality can charge the tax? One outcome of eCommerce will most likely be simplification of the sales tax code on a national level, and increased enforcement. Companies who do collect sales taxes, as required, are complaining that they are penalized. (New York Times, 9/22/99, Pg 20)

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Pattie Maes, the director of the Software Agents Group at the well-known Media Lab at the Massachusetts Institute of Technology (MIT), has developed two types of shopping agents that have been spun off into commercial products. (Shopping agents search eCommerce web sites and make recommendations to their users.) One type of agent of which Firefly is an example, will make taste-based recommendations. Firefly adjusts to your personal tastes in relatively frequent purchases, such as books or music. Another, of which Frictionless is an example, will make recommendations based on price and other objective criteria such as length of warrantee, and is more suitable for purchases that are not frequent, such as cars or refrigerators. (New York Times, 9/22/99, eCommerce Pg 22)

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Brick-and-mortar shoppers have social and tactile experiences that online shoppers do not share. Brick-and-mortar shopping is also more similar, with the door, the aisles and the check-out counter, compared to online shopping. Online shoppers are more impatient, and "everywhere is an exit", according to Paco Underhill, author of Why We Buy: The Science of Shopping. Also, online shoppers are less patient and better able to express their frustrations, since they can establish their own web site to make complaints. (New York Times, 9/22/99, eCommerce Pg 22)

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As an experiment, Marty Katz created a web site for Fine Grind, a coffeehouse run by Dave Wolff in Bel Air, MD, on a strict budget -- as little as possible. So far, their only expense has been $70 for registering their site name, www.finegrind.com. And that service is now available for free. They used free email from Yahoo, a free web site and online web site creation kits from Infoseek. Pictures are available from many web sites. Mr Wolff doesn't even own a computer -- he goes to the library to check his email orders. (New York Times, 9/22/99, eCommerce Pg 29)

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Suzanne Ritchie, a former photo editor at the New York Times, quit her job there last spring, to start her own online auction business selling through the online auction house Ebay. Since the audience is so large, prices are high, and for some items that are not in good shape, she does not accept the highest bid, or accepts the buyer but charges them less. She is also starting her own web site, having hired a consultant, and tries to educate her customers about pattern glass, an older form of glass. She expects the web site expenses to be about $10,000 by the time she is finished. (New York Times, 9/22/99, eCommerce Pg 29)

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While the large online marketers such as Amazon.com are still the big winners, small retailers are still entering web marketing, and finding new markets.The family-run Parkway Hardware in West Chester PA has a had a radio program, "Hardware Talk" since 1997, building on their local reputation for being able to, "fix just about any hardware or home improvement problem." Recently they started a web site (www.hardwaretalk.com) and put the radio show online, along with online tips. Now they have customers from around the world, who make annual trips to their store. There are 23 million small businesses in the US (fewer than 100 employees) and 41% have web sites, up from 31% in 1997 and 8% in 1996. Pete & Ron's Tree Service in Tampa FL, uses their web site (P-R-Tree.com) to explain what a tree service does, and finds that more than 10% of its business is generated by the web site. In addition, they can compete for government jobs over the Internet. Bigstep.com is an Internet startup that provides initially free web services for companies. In its first five weeks, it has signed up 10,000 small businesses, including dog walkers, jewelers, people running garage sales, and used clothing stores. (New York Times, 9/22/99, eCommerce Pg 34)

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Reno Nevada has more than 500 several large warehouses for eCommerce companies -- the new warehouse for Amazon.com is located there. eCommerce is pushing warehousing to go high-tech with new wiring and computer systems, to track individual orders instead of wholesaling sales. (New York Times, 9/22/99, eCommerce Pg 36)

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Kevin Lipsitz sold magazine subscriptions over the Internet, from Staten Island, New York. When customers complained that they did not receive what their subscriptions promised and took him to court, Mr Lipsitz put forth the argument that the State of New York did not have jurisdiction over the Internet. The judge, Justice Diane S. Lebedeff found that Mr Lipsitz was subject to New York laws anyway, and was guilty. The general issue, however, remains thorny -- is an Internet business subject to all of the laws of the jurisdictions in which it operates? Do the laws of the region in which the business operates take precedence, or those that apply to the consumer? There is no treaty or other agreement in this area. Ronald L. Plesser at Piper & Marbury, who is involved in this issue, is recommending a self-regulatory approach, with online businesses signing up to a code that would be honored by courts. Consumer groups and law-enforcement officials say, however, that this will not be enough. Caitlin J. Halligan, chief of the Internet Bureau at the New York State Attorney General's office, advocates basic consumer caution. (New York Times, 9/22/99, eCommerce Pg 39)

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Home delivery is a growing business, thanks to eCommerce. The "abandoned virtual shopping cart" is becoming more common as purchases find that shipping costs can add large amounts to online purchases. Security is another issue; David Porter, a dry cleaner in Kansas City MO has obtained a patent for the Smart Box, a secure mailbox with coded access for delivery, expected to sell for $300 to $400. eCommerce is being entered into by (a) established brick-and-mortar merchants, (b) companies that sell through catalogs and telephone orders, and (c) virtual companies. The catalog companies often have the most experience with home delivery and have the fewest problems. (New York Times, 9/22/99, eCommerce Pg 42)

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At present, online shoppers are older, have more income, and more education, and are more apt to be male, compared to the general population. They also shop more often and spend more money each time. However, while online retail is making headlines, business-to-business eCommerce is almost ten times larger, and is growing faster. (New York Times, 9/22/99, eCommerce Pg 58)

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Apple Computer said that it could have had higher revenues and profits from its computer sales, except that Motorola could not make enough high-end microprocessor chips to sell to Apple. (New York Times, 9/20/99, Pg C1)

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Microsoft and Ford announced a joint venture that would allow customers to configure their own cars over the web, obtaining information directly from Ford's manufacturing-system database. and to get detailed information on availability. Since automobile manufacturers are prohibited from selling directly to customers, the web site would refer customers to dealers. Dealers' opinions were mixed, with some saying that Ford was trying to take over automobile sales, others saying that power would now shift away from the dealer towards the customer, and still others expressing optimism about doing business over the Internet and servicing customers. Microsoft's announcement said that Ford had earlier purchased an interest in Microsoft's Carpoint web site. Microsoft also said that Honda would license Microsoft's Dealerpoint system to help its salespeople manage their contacts and respond to Internet customers. Ford and Microsoft said that the customer-preference information from the web site would be invaluable as well. A retail car sales web site, Autobytel generates $1.7 billion per month in sales, from 200,000 referrals. Microsoft's Carpoint generates $600 million monthly from 140,000 referrals. (New York Times, 9/20/99, Pg C2)

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Online literary magazines and web sites are starting to offer stock options to writers, instead of cash payments. Options allow their owners to buy stocks at an initial offering price, after those stocks have often-spectacular increases once the site "goes public", that is, starts selling shares. So far, 'zines and sites are being secretive about which contributors have options. (New York Times, 9/20/99, Pg C1)

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Decoding the human genome (the collection of all human genes) has been a scientific project for five or more years. there are competing private and government-financed projects to complete the project within a decade, at the outside (the private project claims that it will finish the project within three years.) Commentators have been concerned that the human genome could become proprietary and used to generate profits, not medicines and treatments. Now, the human genome is beginning to appear on the world wide web, and plans are that it will be open to all researchers, and to the general public. Pangea Systems is currently testing its doubletwist.com web site within Stanford University.

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Tim Berners-Lee, the inventor of the world wide web, heads the world wide web consortium (W3C) headquartered at the Massachusetts Institute of Technology. Berners-Lee has not founded an Internet company, and says that many people, especially Americans, are amazed that he has not "cashed in." However, he says that he is more interested in seeing that the web remains open to the public. For example, all of the technologies are described in the public domain. Berners-Lee has written a new book, "Weaving the Web", in which he describes his development of the web, building on other publicly available technologies and concepts, and keeping it simple. In its second half, Berners-Lee describes how he expects the web to develop in the near future. He expects that documents will start to contain more information about themselves, allowing searching to be more productive, and allowing automated organizational systems.

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Microsoft is expected to announce a deal with Ford to allow direct access to Ford's databases on the Microsoft Carpoint web site. Auto manufacturers are not allowed to sell cars directly, but an estimated 40% of car buyers now research their purchase on the web before buying. The Microsoft/Ford agreement is part of Microsoft's tighter focus on the Internet. Microsoft is also expected to announce web-loaded versions of its popular Office software for $14.95 per month. (New York Times, 9/20/99, Pg C2)

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The Bertelsmann Foundation in Germany has proposed a worldwide voluntary rating system for Internet content. In this three-layered system, on the bottom layer, web sites would voluntarily rate their sites using a set of standardized terms to be drawn up later. On the second layer, organizations would create rating systems based on the self-ratings on the first layer. The third layer would contain exceptions; sites that were unintentionally filtered out by the ratings on the second layer. (New York Times, 9/20/99, Pg C4)

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Internet commerce costs are increased by the use of stolen cards to make online purchases. UTM Systems is marketing an inexpensive credit card ready that it hopes will cut down on such fraud. When ready to make a purchase, the user inserts the credit card in the reader, and then inserts the reader into a floppy disk drive. the user's PIN is required for all transactions. The card reader is expected to retail for $6. (New York Times, 9/20/99. Pg C4)

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Downloading digital music files in the Mpeg level 3 file format (MP3) is an increasingly popular way of distributing and pirating music online. However, users often cannot find where their files have been downloaded to, and the files themselves often have unhelpful names (e.g. 977X021.MP3). Now, a company named Myplay is launching a web-based   "digital locker", planned for mid-October rollout, to keep track of music files by title and artist's/group's name. Each user will initially be allocated 250MB of online music storage, enough for five to six hours of music. The site plans to make money by selling advertising, by marketing arrangements with music producers, and eventually by selling higher amounts of storage. Adam Somers, a marketing executive at Dreamworks Records, one of the initial investors, said that from Dreamworks' perspective, "it's another way of finding out what people are listening to." (New York Times, 9/20/99, Pg C4)

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A new web site, govWorks.com, offers to pay fines and traffic tickets for consumers, for a 5% fee. govWorks does not need agreement with government agencies, because anyone can pay a fine or traffic ticket. (New York Times, 9/20/99, Pg C4)

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Internet startup businesses, which happen so easily and frequently in the U.S., are difficult even in prosperous, digital-aware locations like Singapore, where the government micromanages the economy. Singapore, however, has started a campaign to lighten but not remove the government control, in the hopes that it will retain its competitive success in the next century. (New York Times, 9/19/99, Section 3, Page 1)

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Cloth diapers have virtually disappeared from stores, along with diaper services. But a small number of entrepreneuring moms is using the world wide web to sell their own products. There is even a market for used cloth diapers, sometimes called the "brown market" (sorry, but it's true!). Cloth diapers are also sold through Ebay and other online auction houses. While sales are growing, they are still a tiny fraction of the overall diaper market. Kimberly-Clark, the manufacturer of Huggy paper diapers, says that it has not noticed any impact on its sales. (New York Times, 9/19/99, Section 3 Pg 6)

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American Express is adding a blue card to its other offerings. The blue card can be swiped through a card ready attached to the user's PC, to make online purchases. Use of a PIN is required for all transactions. Blue cards can also be used in stores, and will be free through January 31 for qualifying customers, and $25 thereafter. (New York Times, 9/19/99, Section 3, Pg 10)

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The White House announced that the U.S. would end curbs on export of the strongest data encryption software. The Justice Department, the F.B.I. and intelligence agencies have long argued for the curbs, on the basis that the law-enforcement agencies would no longer be able to decode electronic information protected with this software. Encryption software manufacturers have argued that the curbs were ineffective, and simply meant that U.S. firms would lose sales, since the encryption software is widely available anyway. (New York Times, 9/17/99, Pg C1)

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AT&T and British Telecommunications will extend their former agreements into an effort to build a world-wide wireless network. Telecommunications companies feel that they need to be able to provide a comprehensive "anytime, anywhere" communications package in order to compete for the business market. Previously, telecommunications had been a country-by-country market. (New York Times, 9/17/99, Pg C2)

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To compete with the largest online auction house, Ebay, other online auction houses, including Microsoft (MSN), Yahoo and Excite@Home, agreed that items offered for sale on one of these sites would be automatically cross-listed on others. This system uses software developed by Fairmarket, a small Massachusetts company that had previously supported companies to set up their own auction sites, mainly to sell discontinued items. (New York Times, 9/17/99, Pg C2)

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China does not allow foreign investment in its Internet Service Providers, but foreign investment has grown in Internet portals (large web sites that seek to act as a gateway onto the web) and in Chinese-language electronic commerce. However, a government minister has announced that all such investment is illegal. Investors say that they have cooperated with government agencies and that they believe that foreign investment will continue, despite the minister's remarks. (New York Times, 9/17/99, Pg C4)

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Sony announced that Cablevision Systems would buy more than $1 billion of Sony set-top boxes to deliver advanced cable services to Cablevision's customers in the New York area. Cablevision said that these boxes would provide movies on demand, play interactive games on television sets, experience sharper video, and use email on a television set. Commonly, set-top boxes also provide high-speed Internet access, but Cablevision said that it would keep that part of its business separate. (New York Times, 9/17/99, Pg C5)

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National Public Radio (NPR, locally WSU's WDET at 101.9) reported that QualComm, one of the first companies to produce digital cellular phones, will be trying to sell off that part of the company, because competition is increasing for this type of phone, and profit margins are falling. The company said that it was trying to combine manufacturing operations with another company in order to remain competitive. (NPR, 9/15/99)

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Top marketing executives are being lured away from "brick and mortar" companies into Internet start-ups. The executives frequently accept pay cuts, but are rewarded with stock options in the companies they join. The Internet companies are trying to gain experience in making ordering and payment easy for customers. (Investor's Business Daily, 9/15/99, Pg A5)

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Online purchasers are irritated by high shipping charges, that they only learn about at the end of the purchasing process. Consequently, some online marketers are beginning to offer free shipping. (Investor's Business Daily, 9/15/99, Pg A6)

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This section summarizes a series of articles from Investor's Business Daily, 9/15/99, under the heading heading of Tech Extra: E-Commerce, Pp A5 through A12.

Brand recognition is important for online marketing success, along with being first online, customer service, and a fast, attractive, convenient web site. Shoppers go to malls for easy comparison, and web sites that sell a variety of merchandise also have this factor going for them. The web site must also be fast and convenient. Too many graphics will slow down the web site, but too few and it becomes uninteresting. Two-thirds of online shoppers click off without ordering, and too many graphics can overwhelm the purchaser. Customers like well-designed, well-laid-out web sites. One common rule of thumb is that nothing should be further than three mouse-clicks away. Customers that buy during business hours are probably at work, and have higher speed access, and so will tolerate a higher level of graphics, compared to those who shop at night over a modem.

Manufacturers of office-integration software are extending their reach to eCommerce, including supplier communications and retail sales. The big five companies in this area are J.D. Edwards & Co, Baan Co, Oracle Corp, PeopleSoft Inc and SAP AG.

The "plastics brothers", Tom and Nick Stojka, started a web site for plastics-related machinery manufacturers like themselves, for bulk manufacturers, and their wholesaler customers. Customers can buy at the fixed catalog prices or use online auctions. Technical support is also provided online, and in fact lack of technical support was one of the factors that encouraged the brothers to start this enterprise. Their company, Commerx Inc, which runs the PasticNet web site, makes 5% to 15% on each transaction over the site. While they will not reveal dollar figures, they do say the business is growing at 200% per month. Similar sites are starting for other industries such as metals and chemicals.

Web portals, which seek to attract many users by being a convenient way to organize and locate content, are have a hard time dealing with adult content. Many of their customers want to locate this content, but others want to avoid it. Also, such sites are willing to pay double the going rates for web advertising, and advertising is how portals make their money. Some web portals offer options to users, while others refuse adult content altogether. Subscribers can set up passwords to keep their children out of certain sites.

Mom-and-pop small businesses are increasingly turning to the world wide web and eCommerce. A five-mechanic repair shop in Fullerton CA, Rollings Automotive, increased its business by 30% with its web site, advertising services and specials. Last year, 150,000 business were online, and this year the number is 400,000. One estimate for next year is 850,000.

'bots is web-speak for online robots, pieces of software that automate certain tasks. One example is the shopping 'bot that compares products for sale and makes recommendations. Early versions judged on price alone. Others use warrantee, delivery and return policies. Other shopping 'bots have chat rooms where customers rate products. Some shopping 'bots are sponsored by specific manufacturers, and users fear that these may not be unbiased.

Online commerce is clearly growing rapidly, but it still has some problems. For Christmas 1998, online sales totaled $3 billion, more than double the $1.3 billion from 1997. International Data Corp estimates that online sales will top $1.3 trillion. Problems with online sales often include poor return services, no toll-free number for technical problems, buggy software, confusing web sites, and too many graphics making for a slow web site, especially for modem users. Advice is that online sellers should focus on the customer experience.

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3Com, the #2 maker of networking equipment (Cisco Systems is #1) and the popular Palm Pilot series of hand-held Personal Digital Assistants, will spin off the Palm Pilot unit so that both units can focus more closely on their respective products. (New York Times, 9/14/99, Pg C1)

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Microsoft is looking beyond the "browser wars" with Netscape, that are the focus of the current trial with the US Justice Department, and recruiting for what it sees as the next battle over the technology for Internet applications and eCommerce services. Microsoft intends to use a generic feature in HTML 4, XML or Extensible Markup Language, to support its proprietary software in this area. (New York Times, 9/14/99, Pg C1)

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In Europe's fast-changing corporate culture, the second European hostile take-over was announces as the French Total Fina oil company bought the French Elf Aquitane oil company for $48.8 billion, creating the world's fourth-largest oil company. (New York Times, 9/14/99, Pg C1)

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Motorola is seeking to buy the General Instrument Corporation to acquire that company's expertise in manufacturing set-top boxes. The set-top box, currently usually a cable tuner, sits on top of a television set. As cable information services proliferate, the set-top box is predicted to become the point of entry for these new services into the home. This trend -- for all information services to blend and merge, is called "convergence." Probably the largest business question is whether cable or telephone lines will win this information war. (New York Times, 9/14/99, Pg C2)

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Many movies and books now include web sites as part of their promotion efforts. For example, www.isaacsstorm.com promotes the book on the Great Hurricane of 1900, Isaac's Storm. And the movie Bowfinger, starring Steve Martin and Eddie Murphy, has its own web site, www.bowfinger.com. (New York Times, 9/14/99, advertisements in Section B)

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An Internet start-up, garageband.com, will announce its web site on Monday. The web site hopes to attract new musical talent to distribute its music on this web site, and will offer royalties and recording contracts to its musicians. Musicians will upload their music, and listeners will rate it. Garageband plans to offer contracts for the most popular musicians each month. Currently, only 600 or so of the 30,000 CDs published each year are profitable. Garageband hopes to use its listener ratings and statistical methods to improve that average. The total dollar volume for all downloaded music was $1,000,000 last year, so obviously people have not yet figured out how to make money selling music over the Internet. Garageband hopes to change that. (New York Times, 9/13/99, Pg C4)

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Microworkz was a start-up manufacturer of PCs that last year announced plans to sell complete computer packages for $299, called the Webzter. That venture failed because, according to Microworkz, the potential demand was overwhelming, and other companies announced similar plans. The company charged credit cards, but was unable to produce the computers in a timely manner, and was unaware of the FCC's rule that goods must be shipped within 30 days of being charged. This led to numerous complaints, and the collapse of the initiative. Now the company is marketing the iToaster, an Internet device, for $199, and shipping in a timely manner. (New York Times, 9/13/99, Pg C5)

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Congress created an Advisory Commission on Electronic Commerce and charged it to come up with a policy recommendation for taxing eCommerce. The Commission consists of eight business representatives, three members of the Clinton administration, and eight representatives from state and local governments. Business has expressed concern at being subject to requirements of different tax rates from overlapping jurisdictions. A majority on the Commission has agreed in principle to one of two possibilities -- either states and local governments agree to a single total rate for each state, or software be made freely available to calculate tax rates. The chair of the Commission opposes any Internet taxation, however, along with several other members. States and local governments are fearful of losing the ability to collect sales taxes, which are often a major part of their revenues. The panel's chair said that even if there were no agreement, the panel would succeed in defining the issues for Congress. He hopes for a final report by next Spring. (New York Times, 9/13/99, Pg C5)

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Online gambling has become increasingly popular, and is estimated to reach $1.2 billion this year. Reliable Software Technologies has announced a security flaw in ASF Software's implementation of Texas Hold-em Poker that would let a user learn what order his virtual cards were in in the deck. ASF says it has already corrected the problem, but Reliable Software says it expects to find more flaws in this an other gambling software. (New York Times, 9/13/99, Pg C5)

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New technology, a chip set that would cut power use by cellular phones and allow them to operate longer without recharging, was announced today by Analog Devices Inc. The chip set would also transmit data up to 30 times faster than the current standard of 14.4 KBPS for cellular, and would allow wireless connections for laptops. The chip set is also less expensive than current technologies, and would result in lower costs. (New York Times, 9/13/99, Pg C7)

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The U.S. Environmental Protection Agency (EPA) has been requiring chemical manufacturers to describe risks of chemical accidents, and their plans for managing accidents that actually occur. The information has not been published, for fear of aiding terrorists. Now a web site (www.rtk.net) has published the State-by-State executive summary of this database. The groups that run the web site hope eventually to win fuller disclosure of the detailed information. (New York Times, 9/12/99, Section 1 Pg 21)

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George W. Bush, the frontrunner for the Republican presidential nomination, said that his staff would begin listing all contributions on the campaign web site. This was in response to criticism that his success in fund-raising meant that he was secretly in the control of his contributors, and in response to concern about the role of money in politics generally. Other candidates will most likely be under pressure to match this unprecedented level of disclosure. (New York Times, 9/10/99, Pg A1)

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Sonicbox, a Silicon Valley startup, will manufacture a system for playing web radio stations over a regular radio, so that the user is not tied to a PC. A web radio station subscribing to this service will still play over a user's PC, but the PC will then broadcast over an unused frequency to a radio that is no more than one hundred feet away. Two brothers running a web-only radio station say that they will certainly subscribe, since lack of mobility is about the only complaint that their listeners have. (USA Today, 9/10/99, Pg B1)

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Lycos, the Internet search site, said that it would buy Quote.com, which provides stock quotes, so that Lycos could supply stock quotes on its own site. Lycos is competing with AOL, Microsoft and Yahoo. (New York Times, 9/9/99, Pg C4)

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Pinnacle Holdings, based in Sarasota, FL, rents space on communications towers in the Southeast. This space is rented by communications companies. Pinnacle announced that it will buy additional towers and rooftop sites, which will make its rental services more attractive to wireless carriers seeking to expand in this area. (New York Times, 9/9/99, Pg C4)

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The Walt Disney company named a head of its Internet group, Steven Borstein. Borstein started in sports cable, was named head of ESPN, became head of ABC/Capital Cities, joined Disney when Disney bought Capital Cities and was recently named president of ABC. The Disney Corp plans to merge with Infoseek Corp, with whom it runs the web portal Go.com. (A web portal is supposed to be a major entry point or "home base" for web users, from where they can branch out easily to other sites. The portal also seeks to provide popular content to keep the visitors on its site. With large amounts of traffic, the portal seeks to make money off of advertising.) Go.com has other investors as well, but Disney and Infoseek plan to acquire it fully, and then spin it off  into a separate company, to be called Go.com. (New York Times, 9/9/99, Pg C6)

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Sony said that it would start manufacturing a new generation of digital video recorders (as opposed to the analog VCR) that would store video on hard drives, and allow much fuller control by the user. VCR programming would be simplified by automatically downloading schedule information over a network connection (perhaps a phone line), so that users could click on a program in a list, and then the recorder would program itself. Viewers could also do their own instant replay, pause a live program (e.g. to answer the phone). (New York Times, 9/9/99, Pg c6)

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InfoCure, which makes software for health care companies, agreed to buy DataMedic Holding, which provides services based on InfoCure's software. (New York Times, 9/9/99, Pg C6)

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Alan Greenspan, chair of "The Fed" (Federal Reserve), suggested to day that America's economic expansion could continue, based on advancements in information technology. The current American economic expansion, now in its ninth year, is based on "intellectual and impalpable" value, rather than "large steel mills, auto assembly plants and skyscrapers", Greenspan said. Greenspan spoke at Grand Valley State University in Michigan. (New York Times, 9/9/99, Pg C8)

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With CD recorders ("CD burners") now available at under $200, Manhattan is seeing a lot of street vendors selling knock-off copies of commercial music CDs for $5 and less. Police are also making more arrests of rings that counterfeit CDs. A street merchant being interviewed said that the copies he was selling came out of an apartment that was packed with CD burners, and that he bought his copies from a middleman. Music companies complained that, just when pirating of audio tapes was coming under control, CD burners came on the scene. Pirated audio tapes often had inferior sound quality, but the digital nature of CDs means that copies are perfect, as good as the original. (New York Times, 9/9/99, Pg B5)

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Online furniture stores are proliferating. While spending thousands of dollars on something you haven't seen or sat in might seem risky, online customers find the range of choice compensates. Movie stars, for example, are fueling a craze for antler chandeliers, and local stores have been cleaned out, but they are easily available over the Internet, in quantity, and in the very large sizes that are in demand ("crates as big as cars"). Also, mom-and-pop operations, especially for novelty or niche items, are flourishing. For example, Fred Friar sells homemade sassafras chairs from his West Virginia farm at www.home.earthlink.net/~ffriar. Larger, more traditional retailers such as Crate and Barrel, Smith & Hawkin, Restoration Hardware and Ethan Allen are establishing online operations. 11 AM and evenings seem to be popular times for online furniture shoppers. (New York Times, 9/9/99, Pg B1)

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More and more small merchants are selling antiques, collectibles and novelty items using existing online auction sites, in effect setting up their own stores within a mall. Forrester Research estimates that this business was $1 billion in 1998, will be $2.3 billion in 1999 $6.4 billion by 2003. Ebay, the online auction house, estimates that it has 10,000 "power sellers" who sell $2,000 to $25,000 per month. Many mom-and-pop merchants with small retail stores find their business expands so much online, that they can't justify the expense of the store anymore, and close it. Other people who start out in their spare time, do well running their online operations through an online auction house, and quit their day jobs, and work with something that they really enjoy anyway. Among some suggestions for being successful online are: (i) choose the right words to describe each item (know what words people are using in online searches), (ii) spell correctly to get search results and (ii) include common misspellings. Specialization seems to help. Don't sell too broad a range. Specialize in Star Wars action figures or Barbie Dolls, but don't try to sell both on the same site. Other "scavengers" that run their own, smaller sites, will watch the large auction sites and send an email to a buyer who offers more than the small site would charge. Forrester research predicts that manufacturers will soon start auctioning their new products as a new distribution channel. (New York Times, 9/9/99, Pg D1)

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Inventors are increasingly finding support, advice and investors over the Internet. Earlier, many had to rely on support companies, which would often seek control and the major share of the profits. With the Internet, inventors have more options, and can describe their experiences with such companies. Another source of support is that people willing to help develop an invention, who have a specific skill that the inventor may lack, can connect up more easily. Some examples of web sites for inventors are Inventors Alliance at www.inventorsalliance.org and Patent Cafe at www.patentcafe.com. (New York Times, 9/9/99, Pg D9)

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Sega's new Dreamcast game player ($200) can also be used for email, web chat, and web surfing, and downloading games. It also has graphics that rival high-end computers. (but a review says that its games are not yet top-rate). Dreamcast can play CDs runs a downsized version of Microsoft's palm-top WindowsCE, meaning that it could become much more flexible than other game machines, if it becomes popular (which would lure programmers to write applications for it). (New York Times, 9/9/99, Pg D1)

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A new plug-in replacement for a car stereo, from Clarion Auto PC in cooperation with Microsoft, is one of the first automotive computers. It can download email via an FM connection, respond to voice commands to read and reply, give directions, do hands-off dialing of a cell phone, all in addition and at the same time that it is working as a radio or CD player. More and more drivers are trying to turn drive time into office time, in contrast to earlier times when the family would pole into the car for sight-seeing or ice cream treats. (New York Times, 9/9/99, Pg D1)

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The Wharton School (business) at the University of Pennsylvania has started an auction for allotting seats in elective courses. Instead of real dollars, student start with a credit of 5000 points, and can bid on courses. In later auction rounds, students can "resell" the courses that they won in an earlier round. Students till have to pay tuition in U.S. dollars, once they win a seat. (New York Times, 9/9/99, Pg D3)

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In a development sure to provoke controversy, StudentU.com is hiring students ($300 for a semester) in Ohio, Boston and Michigan, to attend large lecture courses and take notes, which are then posted on the web. The notes are available there at no cost. StudentU.com hopes to attract a large enough audience to make money on advertising, according to its owner, Oran Wolf, a graduate student in Texas. The note-takers may not be enrolled in the course for which they take notes, but attend with the permission of the Instructor. In other cases, note-takers are enrolled. Initially, many Instructors and administrators are reluctant because they assume class attendance will fall, but this has not been happening. Other negative reactions have been that Universities will now abandon the lecture courses with 300+ students (which would not make the venture feasible), that faculty object to their intellectual property being "stolen", and that this public, even international disclosure may curb free discussion. (New York Times, 9/9/99, Pg A1)

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National Public Radio (NPR, locally WSU's WDET at 101.9) reported on a new type of online buying that aggregated demand. If several customers banded together to buy the same product, the price to each went down. For example, a digital camera sold at $319 for five customers, but $299 for fifteen. One of the sites, www.mercata.com, allows a customer to send an email to five sites, with product information automatically included. The reporter, John McChesney, said that this is the opposite of an auction, where if more people want an item, its price rises. (NPR, 9/9/99)

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On 9/7/99, a Federal judge in Detroit ruled that the First Amendment right of free speech gave Robert Lane the right to post information from Ford Motor Company confidential documents on his web site, blueovalnews.com. The judge, Nancy G. Edmunds, ruled that the web site could paraphrase and quote from confidential documents, although copyright rules prohibit the site from carrying the documents in their entirety. A separate suite against Lane alleging violation of Ford trademark rights is still continuing. (New York Times, 9/8/99, Pg A12)

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In the biggest media merger to date, Viacom is buying CBS. Viacom already owns UPN Network, Paramount Television Group, MTV, Nickelodeon, Showtime, Comedy Central, Paramount Pictures, Blockbuster, Paramount Home Video, Simon and Schuster (book publishers), MTV Networks On Line and the Paramount Theme Parks. CBS own the CBS network, CMT and TNN, Infinity (a network of 160 radio stations), Marketwatch.com, CBS.com, Country.com, TDI Worldwide and Outdoor Systems, Inc (billboard advertising). This would be an example of "vertical integration", having content production and content distribution within the same company. The new company will also be a major advertising firm, and a major and distributor of music. The purchase price is $37.7 billion (New York Times, 9/8/99, Pg A1)

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Dr. C. Everett Koop, the former U.S. Surgeon General, well-known for his plain speaking and advocacy for public health, has started his own health-related web site, www.drkoop.com (evidently forming a company to create the web site as well). Because of Dr. Koop's public credibility, this web site has attracted a lot of users, and a lot of attention, and advertisers. Dr. Koop and his web site have received some criticism that they are not clear enough in separating the ads from the information. (New York Times, 9/8/99, Pg A28)

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Microsoft, Global Crossing Ltd (Bermuda) and Softbank Corporation (Japan) have formed a joint venture to create a $1.3 billion fiber optic network from Japan to Malaysia, called Asia Global Crossing. Global Crossing recently renegotiated an agreement to buy Frontier Corporation, formerly Rochester Telephone, after GC's stock lost half its value as a result of the original agreement. (New York Times, 9/8/99, Pg C2)

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Amdocs, a producer of software for telecommunications companies, is buying International Telecommunications Data Systems, which provides billing services based on Amdocs' software. (New York Times, 9/8/99, Pg C4)

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Mediaconsult.com Inc, which primarily provides medical information to patients with chronic diseases, bought Physician's Online Inc for $166.5 million. Physicians Online offers online services such as email and access to medical databases. Mediconsult intends to combine the two audiences. (New York Times, 9/8/99, Pg C4)

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Digital Island Inc announced plans to build an Internet-based network to improve audio and visual transmissions. Digital Island will use technology developed by Real Networks (Seattle) and Inktomi Corp (San Mateo CA). Digital Island, which presently provides network management services to web sites, saw its shares jump 32% on the news.

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Motorola is hiring 2000 more workers for its cellular phone division. (New York Times, 9/8/99, Pg C4)

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EDS Corporation, the computer services corporation, will buy back 27 million of its own shares, primarily from General Motors and Delphi workers, who own the stock through their pension plans. (New York Times, 9/8/99, Pg C4)

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IBM announced plans to produce a server computer for Internet Service Providers (ISPs). The computers will be about 1½" thick, allowing them to be stacked as business grows. This type of computer costs $3000 to $4000 and has been pioneered by Sun Microsystems, the market leader in this segment. (New York Times, 9/8/99, Pg C4)

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Sun Microsystems announced its second-generation "computing appliance", the Sun Ray. Such computers have few local resources such as hard drives, but instead get and store programs, documents and data on networks. These are supposed to be simpler to install and maintain than traditional desktop computers. For example, software is upgraded on the network, not the individual computer. A complete system -- computer, software and monitor -- will lease for $30 per month. The software will include Star Office (see above). (New York Times, 9/8/99, Pg C6)

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Lucent Technologies, the former Bell Labs and a leading manufacturer of telephone equipment, announced the Stinger today, which will use high-speed Internet lines (Digital Subscriber Lines) to carry high-quality voice calls, by giving them higher priority than other traffic. This technology could someday be used to prioritize other types of Internet traffic such as creating first- and second-class email. (New York Times, 9/8/99, Pg C6)

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Michael Durham, the CEO of Sabre Holdings Corporation, resigned suddenly. Mr Durham oversaw Sabre's development of Travelocity.com, the largest web travel site. No reason for the resignation was given. (New York Times, 9/8/99, Pg C8)

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Microsoft announced that it would introduce a travel and hotel bidding system on its Expedia travel site, similar to that pioneered by Priceline.com. Investors have valued Priceline at higher levels than any airline, despite its severe restrictions (a bidder must accept an offer matching the bid, with no cancellations allowed). (New York Times, 9/8/99, Pg C10)

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You may not realize it, but there is a race on to provide homes with high-speed Internet connections that are always on. There are several competing technologies using both telephone lines and cable TV lines. In many localities, the "cable modem" is the first in getting to market. AT&T, limited to long-distance telephone service by the breakup order of several years ago, has been buying major cable systems and the Internet Service Provider Excit@Home, in order to break into this market. Conceivably, AT&T could also provide local telephone service over the cable connections. Local cable TV companies, expecting to have a corner on the cable modem market, are protesting AT&T's linking of Internet transmission services with the Internet Service Provider (ISP) services of Excite@Home. This would freeze out other ISPs such as American On Line (AOL) from providing cable modem services. Time Warner is also being criticized for similar plans for its cable systems. Local telephone companies are beginning to phase in high-speed always-on Internet access using DSL (Digital Subscriber Line) technology, but even though they say they are being pushed to market before they would like, they may already be late compared with cable access. Satellite and cellular access are other potential technologies.

The needs of consumers are probably best served by having all technologies able to compete on an even footing, with no monopolies. This would (probably) provide the widest choice in types and levels of service, at low costs. One possibility is to require that ISP services (linking computers to the TCP/IP system) be separate from information transmission services (the wires themselves). (New York Times, 9/6/99, Pg A16 - editorial)

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E.J.B. Rose died earlier this year. During World War II, Rose headed the military analysis section at Bletchley Park in England, where German and Japanese military codes were broken and analyzed, a critical factor in England's ability to resist capture by Germany. The analysis section determined the military significance of the decrypted German and Japanese communications. Rose was active in English race relations and book publishing after the war. He was awarded the Legion of Merit for his work during the war, and was appointed a Commander of the British Empire for his work studying racism. (New York Times, 9/6/99, Pg A12) Bletchley Park and equivalent American organizations laid the groundwork for the field of encryption, so important in digital privacy today.

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Major marketers are starting their own magazines in order to control content and presentation. Examples are Sony Style and Joe (Starbuck's). Typically existing magazine publishers contract for producing these. From the publisher's point of view, these are more secure businesses, because losses are written off by the sponsor as marketing expenses. (New Your Times, 9/6/99, Pg C6)

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A U.S. patent has been awarded for a web-based system to notify web surfers with only one phone line that they have an incoming telephone call. When a call comes in, a web window pops up on the server's screen. The surfer can click buttons to ignore the call, take a message, transfer the call to another number, or accept the call. (New York Times, 9/6/99, Pg C5)

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A U.S. patent has been awarded to a Lynn Svevad of Holland, MI, for the idea behind a computer program, "Forever By My Side". You can enter information about a relative or friend who had died, and the program will then simulate communications with the deceased. For example, if you tell the program your birthday, the "deceased" will greet you on your birthday. (New York Times, 9/6/99, Pg C5)

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Online businesses are increasingly allowing purchasers to enter reviews of products, to be read by prospective purchasers. In-house and expert reviews are older, more traditional sources of reviews, but consumers often put more trust in the reviews of other consumers. It is common to edit or delete reviews that use profanity, but negative reviews are usually not otherwise censored. The online bookseller Amazon.com started this trend, and it has created some online bestsellers, for example Lip Service by M.J. Rose. Companies who sell products manufactured by others do not mind negative reviews, because they have other products in the same market segment, and other segments. Companies that sell their own products online have a larger problem, and often keep customer reviews in an area of their web site that is removed from the section where people select and buy. A spokesperson for Dell Computers, which sells their own products online, said that in any case, conversion is so difficult that many online retailers do not want to distract customers with other information at this point. "Conversion", the spokesperson said, is the process of converting browsing into sales -- exploring the catalog, making a choice, making the purchase. (New York Times, 9/6/99, C4)

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An article above from 8/30/99 described Amazon.com's "purchase circles". In one type of purchase circle, book purchasers can find out who else in their company is buying a certain book. Mark D. Fefer, a reporter for for the Seattle Weekly, an alternative newspaper (Amazon.com is located in Seattle) asked his paper's Webmaster to analyze the paper's web server logs to summarize the hits from Amazon.com computers, and published an article ("Outing the Amazonians") on the results. Amazon.com employees are very interested in the want ads, and spend time in the early afternoon reading movie and restaurant reviews. Amazon's employees also show continued interest in an article published 1½ years ago entitled "How I 'Escaped' From Amazon.cult", a former employee's account of his unhappy career there as a customer service rep. A spokesperson from Amazon.com reiterated that they had made participation in the purchase circles voluntary. (New York Times, 9/6/99, Pg C4)

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An Internet uproar arose when a Canadian company producing encryption software posted on its web site a press release that it had found an encryption key in MS Windows called "NSAKey". Suspicion was that this gave the U.S. National Security Administration a "back door" into Windows computers. Microsoft denies that this was the case, while acknowledging that the choice of names was unfortunate. Microsoft says that the name arose from its internal nickname for this encryption key, which assures that Microsoft complies with the NSA's ban on exporting software with the strongest encryption built in. Interestingly, the chief scientist for the Canadian Company (Cryptonym Corporation), who made the discovery, works at the Triangle Park Research Center in North Carolina. (New York Times, 9/4/99, Pg A8)

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The U.S. jobless rate decreased to 4.2% in august, the lowest rate in 29 years, matched only during March of this year. (New York Times, 9/4/99, Pg B1)

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Seagate Technology, a major manufacturer of hard drives, said that it will buy back the shares of its software unit. Seagate is sharply cutting prices on its hard drives to become more competitive. (New York Times, 9/4/99, Pg B4)

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ICG Communications, a telephone company, agreed to sell its fiber optic unit to ACS Communications for $20 million, in order to concentrate more fully on its core service business. (New York Times, 9/4/99, Pg D4)

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Many news sources reported on a human kidney being put up for auction at the online auction house Ebay. Offering human organs for sale is illegal in the U.S. and Ebay stopped the auction, apparently as soon as it became aware of it. Bidding was up to $5.7 million when it was stopped. Ebay feels that the auction may have been a prank and is cooperating with authorities. (New York Times, 9/3/99, Pg A14)

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The Finnish cellular phone company Nokia bought Rooftop Communication Corporation for $57 million. Rooftop produces produces radio systems for wireless Internet access, and has 20 employees. (New York Times, 9/3/99, Pg C3)

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Microsoft announced a reorganization of its Internet Service operations, which have fallen increasingly behind competitors such as America OnLine. Microsoft also said that it would decrease its present emphasis on multimedia in order to focus more on the Internet. (New York Times, 9/3/99, Pg C3)

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Waiters can "skim" credit card information with small pocket modules that read the information and store it in the module, for later transfer to a PC. The information can later be transferred to a blank credit card. In some cases the information has also been posted on the Internet. Pre-approved credit cards can also been stolen out of mailboxes and used. (Today, NBC, 9/3/99)

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Computer Science and engineering courses are increasingly drawing  students away from traditional science and engineering courses, and from other technology courses, such as Physics, Chemistry, Mechanical Engineering and Biotechnology. This is causing concern among educators, and among some parents. One common complaint is that computer science imparts highly saleable skills, but not critical thinking or basic knowledge. Partly as a response, the American Chemical Society (ACS) has put online simulations of experiment onto its web site (www.chemcenter.org). (New York Times, 9/2/99, Pg C1)

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The chief financial officer at Iridium resigned, the second CFO to resign in five months. Iridium declared bankruptcy last month, after failing to attract enough users to its satellite telephone system to make it profitable. (New York Times, 9/2/99, Pg C4) Iridium services were very expensive (about $5,000 per year) but would have provided a high degree of mobility.

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IBM announced plans to enter the communications business more aggressively. Cisco systems, the leading supplier of network routing equipment, recently announced that it would purchase specialized chips from IBM. As pointed out in the article, Cisco and similar companies wouldn't even exist if IBM had been more aggressive earlier, but the same is true of other companies with an early leadership, such as AT&T. (New York Times, 9/2/99, Pg C4)

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Some schoolchildren are starting to use handheld Personal Assistants (e.g. PalmPilot) to schedule events, take notes in class, and play games. Some children say that they were initially attracted by the games, and learned about the other functions later. Teachers are beginning to wonder about the impact of these, compared to the more specialized calculators. Children frequently are handed down an older model when parents upgrade their own. However, cell phones and pagers are still more numerous among schoolchildren. (New York Times, 9/2/99, Pg D8)

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Artificial Life -- the computer simulation of organisms living in the environment -- has been around for decades, and is now undergoing a small renaissance as traditional biologists team up with ALers for sophisticated simulations. (New York Times, 9/2/99, P{g D12)

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"Web cams" -- the small cameras attached to computers -- are becoming more popular with home users as quality and of ease of use improve, and prices come down. Web cams can capture live motion and still pictures. Both video and audio can be emailed or posted on web sites. Still photos can also be turned into greeting cards and illustrations for documents. Real-time or live action video can also be put onto the web for streaming viewing. Jennicam is a well-know example -- a young woman named Jenny keeps hers running in her apartment all the time and posts to her web site. MonicaCam was focussed on the front doors of the office building of Monica Lewinsky's lawyers. Some sites post video of traffic, beach-goers and animals (SharkCam, PuppyCam, etc.) (New York Times, 9/2/99, Pg D12)

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Ty, the manufacturer of the phenomenally popular Beanie Babies, announced yesterday on its Web site that it would "retire" all Beanies by Dec 31 of this year, presumably meaning that it would make no more. Beanie enthusiasts are burning up chat waves with woe and questions. Many suppose that this is just a Ty gimmick to clear out the show rooms for a new set. So far, Ty has refused to elaborate. (New York Times, 9/2/99, Pg C1)

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As hand-held calculators, they can perform more and more functions required in math courses. Some educators are alarmed, while others say that not having to focus on computational skills allows more emphasis on analytical skills (where do you add, instead of how).Some calculators can be used to store textual material for history and language tests, and are commonly banned for this reason. There is concern that the infrared communications ports now appearing in handhelds will  soon be usable for communicating with others outside the classroom. (New York Times, 9/2/99, Pg D1)

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An essay by a writing teacher tells how her students are now able to find and chat with her on AOL. Some guess that she has a deficient social life because of the times of day when she is on line. The teacher blocked her online identity from one student, but the student guessed that by comparing notes with another student, so the blocked student changed her online name and found the teacher again, of course causing profound embarrassment. (New York Times, 9/3/99, Pg D7)

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A start-up company (www.unext.com) has announced that it will produce and market online courses by contract with existing elite universities. Generally, faculty at existing universities are very upset about such developments, questioning the quality of online courses. At least some faculty who have contracted for producing courses for commercial online universities report being shunned by their colleagues. Universities have also been concerned about their reputations if they go online. IBM is one of the first clients of unext.com, whose online college will be called Cardean University after the Roman goddess Cardea, who could "open what is shut and shut what is open." (New York Times, 9/2/99, Pg D1)

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The personal financial software market segment is experiencing fierce competition between Microsoft's Money and Intuit's Quicken. Both are rapidly adding features, trying to become simpler to use even as the functions become more complex, and using the Internet for quick updates and the latest financial information. Both programs now offer balancing multiple checking accounts, writing checks, retirement planning, investment advising and online bill paying. (New York Times, 9/2/99, Pg D1)

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eCommerce companies that are listed on stock exchanges must issue annual reports just like other listed companies. Compared with brick-and-mortar retailers, the reports from eCommerce companies typically only compare total, or "aggregate" growth, and not how various components of the company did compared with last year. (This is not a requirement, but normally stock owners will demand this information, but not so with Internet companies.) Some online groups have begun analyzing the aggregate numbers. One common technique is to divide total revenues by total customers, to find the revenue per customer. While revenues and the number of customers show strong growth for eCommerce firms, revenue per customer is falling sharply. Critics say that this shows risks ahead for stockholders. (New York Times, 9/1/99, Pg C1) The implication could be that customers are losing their fascination with eCommerce. Alternately, this could be the result of lower prices from competition, which is increasing.

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Anonymous online evaluations of faculty by students are becoming more common on campuses. Some such systems are run by the administration, some by the student government, and at least one (www.collegestudent.com) is a commercial venture. (collegestudent.com provides other student-related services as well, such as apartment listings.) Many universities run student evaluation systems, but a large number do not release the ratings to students. In at least one such circumstance, Virginia Tech, the student government then started its own evaluation web site. Many faculty are upset that evaluation web sites are accessible by the public outside the institution. Some online evaluation systems allow comments, while others allow only numerical ratings. Faculty concern is also voiced that education is not a popularity contest, that negative comments can get more than their fair share or attention, and that those satisfied with a course may tend not to go online and evaluate a course to the same extent as those with an ax to grind. However, many positive comments are made online. Students say that they consider the ratings with a grain of salt. Clearly, students now have the potential to run their own evaluation systems. Eric Sas, the president of the student government at George Mason University, was quoted as saying, "I guess they're just going to have to deal with it. I think it's here to stay." (New York Times, 9/1/99, Pg C18)

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Microsoft fixed a security breach in its free email system Hotmail. The breach apparently allowed hacker web sites to read email in Hotmail email accounts, although probably not to change content. The security breach made use of a program written by someone named Michael Nobilio to exploit a Hotmail feature that allowed users to store login information so that it would not have to be entered each time. Although Microsoft closed down the Hotmail system as soon as it learned of the security breach, and did not restart it until the problem was fixed, other people close to the hacker community said that the breach had been known for somewhere between one and eight weeks. White-hat hackers, who find and report problems to operators of systems, expressed concern that those who knew of the breach had apparently not reported it to Microsoft until very recently. (New York Times, 8/31/99, Pg C1)

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Sun Microsystems announced plans to challenge Microsoft in the area of productivity software (word processing, spreadsheets, databases, presentation software, etc.) by offering this software for free Internet downloads, and later to change it from hard-drive residency to a form that is downloaded when needed from the Internet, so that the latest version is always used. Sun purchased the German software companyStar Division G.m.b.H. to acquire its Star Office suite for this purpose. (New York Times, 8/31/99, Pg C1) Sun, an Internet pioneer, has long advocated such uses of the Internet. The Sun motto is "The network is the computer" meaning that computers get their value and usefulness from networks.

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The Swedish telecommunications company Ericsson announced that it would sell its real estate business in order to concentrate on its core business. (New York Times, 8/31/99, Pg C6)

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The New York advertising agency BBDO, which has Pepsi, Visa and Frito-Lay among its clients, announced that it would open an Internet marketing division, @tmosphere. Estimates are that $1 billion was spent last year on Internet advertising, up from slightly over $500 during 1997. BBDO is rushing to catch up with its competitors. (New York Times, 8/31/99, Pg C8)

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MTV announced that it would combine its online audio and video businesses (MTV.com and VH1.com, respectively) and spin them off next year. (New York Times, 8/31/99, Pg C8)

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Competition in the long-distance telephone call business is signified by AT&T's announcement of a lower-cost service. So far, people who make only a small number of long-distance calls have not benefited as much from the competition. AT&T's stock price fell on the announcement, presumably because stockholders felt that its profits would fall also. (New York Times, 8/31/99, Pg A1)

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Many medical web sites offer incorrect, misleading and even dangerous content. An example mentioned in the article is the current online enthusiasm for shark cartilage as a weapon against cancer. The University of Michigan announced the results of a study of Internet sites offering information on the rare cancer called Ewing sarcoma. 371 web sites offering such information were examined, with results that the authors called "shocking". About one-third of the references offered no support for their statements. Six percent of the sites that were not peer-reviewed offered clearly erroneous (outdated or misleading) information. While it was apparently lethal in the past, Ewing sarcoma now has a 75% survival rate with proper treatment, so current information is vital. Some guidelines for finding reliable information are:

• Information should be current
• Peer review should be emphasized
• Is it too good to be true, for example  in conflict with other sites that seem to be reputable?
• Does the site seem to have a bias, or does it appear to be objective?
• Is it associated with a well-known medical center?
• Does it emphasize products for sale?

It is also the case that actual patients sometimes know more about their illnesses than their doctors, due to Internet research. But real people should be quoted, not vague references such as first names only. (New York Times, 8/31/99, Pg D1)

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Job-seekers are increasingly turning to the Internet for leads, and as a result, classified ads in newspapers are in danger of not carrying the best leads. Classified ads are usually the highest source of revenue for a newspaper. Many newspapers are finding that their job classifieds are declining. Consequently, newspapers are trying to find partners to help them compete with the online job sites such as monster.com. One possibility is offering free Internet ads with the purchase of a print ad. (New York Times, 8/30/99, Pg C1)

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The online bookseller Amazon.com has started letting potential customers know what books and music people are buying who live near them, or with whom they work. These groups are called "purchase circles". Potential customers can ask to see purchase circles based on geography, employer, university or professional organization. Amazon.com has always ranked its books by total sales, and indeed best seller lists are based on sales records. Purchase circles do the same thing for smaller groups of people. Geographical information comes from a purchaser's shipping address. Employer, university or professional organization can often be deduced from the customer's email address.

Critics of this practice have raised privacy concerns, and Amazon has responded by letting its users say that they do not want their purchases used in this way. Users can also send an email to say that they never want their purchasing information released in any form. (New York Times, 8/30/99, Pg C1)

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Microsoft is trying to develop a "tablet computer" that would be portable, wireless and with no keyboard, that users would read and write on like a tablet of paper. Presently, Cross produces a portable wireless tablet that you can write on, that will recognize handwriting and transfer notes to a desktop computer, but this cannot display information. Microsoft is betting that previous efforts at developing tablet computers were too far ahead of the technology of the time, and that the technology is adequate today. Some of the Microsoft people on this project come from the legendary Xerox Palo Alto Research Center (PARC) that pioneered ideas such as the mouse, menus and windows.

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Well-designed web pages and web navigation can be critical to the success of eCommerce. One example is that IBM's recent massive redesign of its web site increased sales by 400%. (The IBM web site has more than one million pages.) One problem is that if a web site that is initially well-designed and easy to navigate, but later grows and just adds new links, the number of links that user have to choose from becomes too large, and choices become more random. Each level of navigation should be clear and concise. On the other hand, users do not want to have to navigate through too many layers of menus either. Choices must make sense from the user's point of view, but on the other hand staff tend to organize a site in terms of internal business processes, which frequently do not make sense to customers. Collecting comments via the web page and email can also be important, because many users will not take the effort to write or call in their complaints. On the other hand, the web site designers cannot become defensive. Terrell Jones, president of the travel site Travelocity, said that "the programmers need to hear people call their baby ugly. ... If people don't understand it, they just leave." Jakob Nielsen, who consults on this topic, and publishes an online magazine (www.useit.com) said that eCommerce sites are beginning to have much better navigation schemes than other types of sites, because navigation has a large and immediate effect on the bottom line. Companies must be prepared to walk away from large investments in web sites, and totally redesign them if they do not work. Customers do not care about the effort put into a web site, just about how it works for the customer. (New York Times, 8/30/99, Pg C2)

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Privacy is a major concern for computer users, and has been consistently so for years. Using a web site makes some information available to the operators; the time you accessed the site, what pages you requested, how long you spent with each one, your Internet address (which can be traced back to identify your ISP, which could be your employer or your university). Virtually all web sites log this information. If you fill out a web form, the information on the form becomes available also. There is much contention about who should have access to this information, and what they are allowed to do with it. The U.S. government this week has proposed that it be allowed to track this information within private companies for evidence of illegal activities. Another proposal would allow investigators with a court order to physically enter a building to bug hard drives and Internet connections. In another area, most companies (89%) that collect and use this information do not post privacy policies to tell users what current practices are. On August 18, the US Court of Appeals for the 10th Circuit ruled that telephone companies, while they cannot sell such information, can analyze telephone data for their own internal purposes. (New York Times, 8/30/99, Pg C5) (CLL does have a privacy statement on its home page at www.cll.wayne.edu)

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Microsoft has started to advertise its new software that displays text more clearly on existing hardware. This software, called ClearType, is supposed to make electronic books ("eBooks") feasible. (New York Times, 8/30/99, Pg C14)

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Japan is planning to make an economic comeback by integrating computer and network technology into the home. Many examples listed in this article are also being pursued in the US. For example; online doctors visits and consultations; home computers for students, connected to the local school; microwaves that remember recipes; refrigerators that display what is stored in them; and a personal bathing machine. One example that is not current in the US is that Japanese mothers are giving their children pocket-sized personal locators, and can then get a FAX-back map showing the child's location and a map of the surroundings. Japanese managers are becoming more like those in the US, being decisive and not waiting for consensus to develop. Japanese government is deregulating business. One view is that the US invents new paradigms and concepts, but then the Japanese develop them into products and businesses. (New York Times, 8/30/99, Pg A1)

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ICANN was chosen to move the process of assigning Internet domain names and numerical addresses from the present practice of having them assigned by a U.S. contractor, Network Solutions, to an international competitive private process. ICANN has ten members from seven countries. There are complaints from some members that the membership does not include enough consumer interests, and that this is why the cybersquatting issue gives large corporations the rights that they would have under the present proposal. (New York Times, 8/30/99, Pg C1) A letter to the Times on 9/3/99 referred to cybersquatting as the practice, not of buying up desirable domain names in advance, but of buying a name similar to the domain name of an existing web site.

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US government computers remain open to hacking, even after years of trying to correct problems. This includes Pentagon computers, which are subject to intense infiltration efforts. The General Accounting Office, which made this assessment, says that common problems are:

• Passwords that are regular words or otherwise easily guessed. (Hackers will often try all of the combinations in an electronic dictionary to find passwords. Including numbers can give them a much harder time.)
• Not requiring password changes often enough
• Having a group of people use the same password
• Giving personnel enough computer privileges to change passwords and then alter records to cover their tracks. (One privilege or the other, but not both to the same user.)

(New York Times, 8/29/99, Pg 17)

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The big three cellular phone manufacturers are Nokia (Finland), Motorola (US) and Ericsson (Sweden). There are ambitious plans to upgrade the speed of cellular communications, and to merge cellular communications with the Internet. This is being done through the development of industry protocols, so that all cellular phones will be interoperable. Right now, this is not universal since the digital cellular systems TDMA and CDMA are not interoperable. Competing technologies, as with VHS and Beta videotape systems, inhibit consumers from purchasing any system.  But there is a GSM standard (Global System for Mobile Communications) that allows GSM-compatible cellular phones to work anywhere in the world, with call forwarding and other features. Other planned developments include

• Increasing speeds to 54 MBPS and higher
• "WAP" (Wireless Application Protocol) to connect the cellular network to the Internet for data transmission, so that, for example, you can use a cellular phone for email and the Web
• GPRS (General Packet Radio Service) to boost data rates and allow users to stay connected to the Internet all the time but be billed only for actual transmissions
• "Bluetooth", a low power radio network that will allow all wireless devices in your immediate are (pager, phone, radio, etc.) to work together

In Finland, a "cellular culture" is developing and being studied. Teenagers all have cellular phones, which are on all the time. SMS (Short Message Service) is used frequently to send text messages back and forth like email. Large-group role-playing games are growing in popularity, e.g. East Berlin Rush Hour simulating spying during the cold war. (Wired, 9/99, Pg 135)

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The US Federal Communications Commission (FCC) announced standards for cellular phone transmissions that would give investigators power to tap cellular communications at about the same level that they can tap regular telephone communications. One additional power available with cellular telephones will be the ability to tell what cellular tower is being used, which locates the user within about 2.5 miles. (New York Times, 8/28/99, Pg A1)

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Priceline.com advertises its current selection of empty hotel rooms. The hook is that the hotels will rent these rooms at savings up to 80% rather than let them stay empty. People bid online for these rooms. (New York Times, 8/28/99 Pg C24)

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America OnLine is offering free Internet access in England, but this may not be enough to overcome the lead of others offering free Internet access. Free Internet access is a bigger issue that in the U.S., because English telephone users always pay by the minute, whereas American users only pay by the minute for long distance calls. (New York Times, 8/25/99, Pg C3)

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At this time (August 1999) there are many offers for low-cost computers. Discount prices are from $699 on down to $299 and even free. Frequently, a monitor and printer are included, along with a high-speed modem and multimedia equipment (sound board and speakers). 32 MB RAM and 4 GB hard drives are typical. Windows 98 and Microsoft Works are usually included. In other words, these are full-featured computers. Many of these systems reach those low prices as a result of rebates from a multi-year Internet Service Provider (ISP) contract, frequently from CompuServe. Monthly costs range from $15 to $25. While these prices may be within CompuServe's normal range (I am not claiming to know what this normal range is), bear in mind that there are ISPs that charge as little as $10 per month. But obviously, a computer and a connection with which to access the Internet is becoming a lot less expensive. And since the computer and the ISP service are purchased in an integrated package, it is likely that actually making the connection is simplified (not that it is highly complex anyway).

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Esther Dyson, the author of Release 2.1, is also the interim chair of ICANN, The Internet Corporation for Assigned Names and Numbers. The assignment of Internet domain names, such as www.cll.wayne.edu, is being privatized, and ICANN was established to set the rules for this business. One of the necessary rules says what happens if there are two requests for the same name. In one type of case, a person or a small organization has been using a name, when a large corporation requests that same name, for example because it is the name of the company, or its trademark. In most cases, the original user has been able to keep the name. In another type of case, a person registers the name of a famous person or company, hoping to be able to sell it for a large profit when the famous party wakes up and want to use the name. This is often called "cybersquatting". In cybersquatting cases, the first owner may never use the name. Under present rules, the original owner gets to keep the name, and the famous party must pay whatever this owner wants to charge. ICANN is considering changes that would shift the balance towards someone who would actually use the name. Under this proposal, disputes would be mediated, with the loser paying the mediation costs. (New York Times, 8/27/99, Pg C2).

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On 8/27/99, ABC News described a person who started a Dunkin' Donuts web site, devoted to his own complaints about service there. Many people started sending in their complaints, and the site became quite popular. Dunkin' Donuts tried to threaten a lawsuit, but this didn't shut down the site. Dunkin' Donuts then bought the site. The owner said he felt it was OK to sell because nothing substantial was a stake.

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The standard method for secure computer communications, including those over the Internet, is Public Key Cryptography. Using this method, someone receiving encrypted computer information can be sure that (a) the information was actually send by the person claiming to send it, and (b) it has not been tampered with along the way. Also, a third party cannot decode or disencrypt the information without factoring large numbers, among the most difficult of all computer operations. Still, the hardware and methods for factoring large numbers are constantly improving, and larger and larger numbers are required. In the latest stage, as group of researchers has been able to break a code based on factoring numbers 512 bits long (about 155 decimal digits). It took this group seven months, using 292 computers in 11 countries, although they say that it could be done "over a Thanksgiving weekend" by a large organization such as Microsoft. This does not break all of the codes that can be generated using numbers of this size, but only one of the codes, so that most communications using keys of this size are still secure. Nevertheless, it is time to start the move to larger numbers. Adding another binary digit doubles the difficulty and the time required; adding two digits multiplies the effort by 4, and so on. Commentators expect that this will weaken the government's case against limiting the size of encryption keys. (New York Times, 8/27/99, Pg C2) The US Federal government has been trying to get acceptance for a proposal that government officials could have access to a "back door" key into encrypted Internet data transmissions, similar to their power to tap telephone lines, and to limit the size of the encryption keys. Industry and groups such as the EFF (Electronic Frontier Foundation) have been opposing this.

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Information on political donations is now easier to find. Donations must be registered with the Federal Elections Commission, and now many web sites get this information from the FEC and make it widely available. Two examples are the National Institute on Money in State Politics at http://followthemoney.org and PublicDisclosure Inc. at http://www.tray.com. You can sort information by location, occupation of donor, etc. (New York Times, 8/26/99, Pg D9).

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Wireless digital information transfer is currently limited to 9.6 KBPS (kilo-bits per second), but there are plans to go to 14.4 KBPS and, by 2001, 144 KBPS and faster. By this time, people expect that cellular phones will be able to use email and browse the web. (New York Times, 8/26/99, Pg D8).

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A growing number of people is starting relationships and getting married, based on relationships that began in online dating services. Cupid Network lists 2,500 such sites. Some are general-interest, but others are for special audiences. Compared to "IRL" (In Real Life) dating services, the online services are less expensive, allow more description, and are faster to use and to get responses. (New York Times, 8/6/99, Pg D7). In letters published on 9/2/99, several readers responded to this story. One said that he had been unsuccessful in seeking relationships online, and wondered whether such experiences outnumbered the successes. A disabled woman said that the Internet had been invaluable to her in forming friendships with other disabled people.

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A cluster of syphilis cases in San Francisco has been traced to an online chat room. Users would make arrangements to meet each other "IRL" (In Real Life), and the diseases spread that way. Normally, public health officials interview those with the diseases and trace the spread by tracking partners. However, many of those infected only knew their partners by their online "handles". The operator of the chat room, America OnLine, knows real names and addresses, but said that this was not enough of an emergency to justify breaking their non-disclosure policy. Investigators have hoped to track the outbreak by publishing notices in the chat room. Some of those identified have H.I.V., the precursor to AIDS. (New York Times, 8/25/99, Pg A1). [Still sure about absolute online privacy?] A later story on WDET said that this was a gay chat room "SFM4M" -- San Francisco Men for Men

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In a series of stories during the week of 8/24/99, radio station WDET has reported on a Detroit area web site on Mustangs (www.blueovalnews.com). It started out as a site for enthusiasts, selling racing parts, but the operator (Robert Lane) started getting complaints about underpowered vehicles, and then Ford engineers started sending proprietary documents about future models, which were posted online. Ford has started legal proceedings to block the posting of proprietary information. Litigation is continuing, with a temporary restraining order on posting such information during the litigation.

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Metafilmics, a four-year old company, will release a movie over the Internet. Metafilmics specializes in movies with spiritual themes. This movie, The Quantum Project, will be distributed online by soundsite.com, and viewers will have to pay a fee before downloading the movie for a limited-time use. The movie is scheduled for release next May. (New York Times, 8/24/99). As computers get faster and cheaper, private enthusiasts will be able to produce and distribute their own movies. Movie theaters are planning to switch from film to LCD projectors. Movies will be downloaded by theaters and released less expensively. Also, the quality and intensity of LCD projectors is now adequate for movie theaters.

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Yahoo.com, the web search site, is a partner with with beatnik.com, music.com and Liquid Audio to develop a multimedia web site where users can mix tracks online, and view video on demand, as well as purchase music and video. (New York Times, 8/24/99, Pg C3).

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As multimedia content (audio and video) becomes more popular on the web, it is starting to slow down transmission speeds. Partially this is because the transmission rates for real-time audio and video are much higher than for text. There is another reason in addition, however. When the software that transmits text observes that transmission is slowing, the software cuts its own transmission rate in half. As all text transmitters cut back, the congestion is automatically relieved. However, while the software that transmits audio and video also cuts back its transmission rate, it cuts back only slightly. The quality of real-time audio and video obviously degrade as the transmission rate decreases. (What I call real-time here is more often called "streaming. The meaning is that the audio and video are displayed as they are received. The alternate technique is to download the entire audio or video file and then play it. This is not popular with users, however, because the files are large, leading to long times with nothing interesting happening on the screen.) Text providers are complaining that they act responsibly in cutting back data rates but are penalized. Large multimedia companies such as Real are installing their own high-speed networks. (New York Times, 8/23/99, Pg C1). The article does not mention the many efforts to increase the speed of the Internet.

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Companies are trying to prevent their unions from using corporate email systems. Clearly the corporate email system belongs to management. Unions could abuse email systems by clogging up the system, and by distracting employees with frequent messages. This is becoming a collective bargaining issue. In some cases, the dispute has been settled by allowing limited use of the corporate email system. (New York Times, 8/23/99, Pg C1)

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In the midst of many Internet mergers, Yahoo remains independent. Earlier this year, many Internet companies sought to become "portals"; large sites through which users would make initial Internet contact. The portal site would provide search services and organize the Internet for its users. Yahoo itself was one of the models for the portal concept, although Microsoft and Netscape were also. With supposed high traffic volumes, portal sites could generate advertising revenue. To provide comprehensive content right on the portal site, there was a constant stream of Internet mergers. Lately, however, the portal concept seems to be collapsing; users are not coming to the portal sites. Yahoo's determination to remain independent now seems like a wise decision. (New York Times, 8/23/99, Pg C1)

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Many eCommerce sites selling real goods (as opposed to information) are finding that returns are a problem for them. "IRL" returns are much easier for customers, in comparison to packing the merchandise up again, driving to a shipper, and paying return shipping charges, without knowing that the return will be accepted. Compounding the problems, many online retailers contract out their order fulfillment, meaning that they have no control over what the customers experiences during the return process. Some techniques that seem to be working are: (a) selling merchandise such as books that have low return rates anyway, and (b) making sure that purchases are well-informed at the start (e.g. have clothing pictures with each available color). (New York Times, 8/23/99, Pg C3)

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A small auto dealer saw dramatic increases in its stock price after it announced that it was financing a cure for AIDS, and the news spread quickly through Internet chat rooms devoted to investing. The cure turned out to be a fraud initiated by a self-described doctor who convinced the president of the auto dealer that he had a cure. This is an example of the influence that Internet chat rooms can have on stock prices. (New York Times, 8/23/99, Pg A1)