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The Internet: The Promise and the Perils
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Hijackers on the Information Superhighway

Piracy and anonymity in the on-line world invite regulation if not curbed

By Aron C. Mason

For anyone seeking instant access to information, broadly accessible on-line computer networks are a fantastic boon: They are widely contributed to, provide a vast array of information — at low cost — and are constantly changing and expanding and available almost everywhere.

On the verge of the 21st century, computer networks such as the ubiquitous Internet and a host of others have been established worldwide for those who seek such access and opportunity.

But a dark side to the on-line world has emerged. Such services have become a haven for a phenomenon which, until recently, was virtually untouched by regulation or moderation in this field: “pirating” — infringement of copyrighted or otherwise protected works, ranging from book reviews to software, in spite of the clear law prohibiting such acts in any other medium. “The quantity of information that can be stolen or the amount of damage that can be caused may be limited only by the speed of the network and the criminal’s equipment,” according to Scott Charney, chief of the Computer Crime Unit of the Department of Justice.

To pirates, who often appear and disappear anonymously, these on-line services provide immunity from the legal and ethical restraints that prohibit such activities in newspapers, magazines, radio, television or public speech. In short, pirates exploit such systems to get away with lawless conduct which they never could get away with outside the cyberworld. For their victims — creators of original, protected works — these on-line services pose a constant threat of theft and economic loss.

As Professor I. Trotter Hardy of the College of William and Mary in Williamsburg, Virginia, put it, “Anonymity is power, and I think it will be abused on the Net.”

Theft: From Games to Religious Works

The problem of piracy is serious and growing. Recently, the head of a software piracy ring invited a Los Angeles Times reporter into her home to watch the ringleader lift a new, expensive computer game from LucasArts Entertainment Company, with help from a paid inside saboteur. Using the Internet, the pirate next linked up with a programmer in Moscow who cracked the code, making it possible to play the game without an owner’s manual. The game was posted on a Seattle-based bulletin board through the Internet — days before its official release. Anyone who accessed it conveniently avoided the $65-per-copy retail price, which potentially cost LucasArts millions in retail sales.

Computer piracy extends well beyond computer games. Almost any creative work can be unlawfully exploited on the Internet — and not just when the work is posted on the Internet by the author. There is a growing problem of pirates obtaining copyrighted works and then posting them on the Internet themselves, seeking to undermine the copyright protections and underhandedly “dump” the protected work into the public domain.

This problem has emerged with alarming frequency. In Boston, a professor and book critic found many of his reviews getting posted and used without his knowledge — until after the fact. Such postings potentially denied him any livelihood he may have been able to make from his own works.

A software developer in San Jose, California, found new and unreleased programs being pilfered from computer files by pirates who broke in through the Internet on a Sunday afternoon; though he quickly pulled the plug, more than enough programs had been stolen to eat up his paycheck.

Jerry Berman of the Center for Democracy and Technology noted that “[t]he technology makes it simple, but the law still says if you copy all of USA Today and send it around the Net, you’re violating a copyright.”

Bulletin board system (BBS) operator and service provider Netcom, based in San Jose, California, refused to take action on infringement of copyrights of the Church of Scientology, even when put on notice.

Netcom’s principals insisted that they had no responsibility for their users’ postings and that they could not be held accountable for them. They even went so far as to claim that they did not have the ability to take action to remedy the violations of the law.

Freedom has learned that those assertions, while convenient to Netcom as it struggles to manufacture a defense, simply do not comport with the facts. The simple truth is that while Netcom refused to take action on a known infringer, they have often taken matters into their own hands behind closed doors. An insider reports that Netcom staff accessed and rummaged in client files, without authorization, to arbitrarily delete material which they unilaterally judged to be in violation of copyright law. Moreover, Netcom reportedly cooperated with the FBI to search client accounts in child pornography cases and even removed an entire BBS off the system in response to complaints.

There was even an incident reported of an Italian subscriber’s account being terminated by recently dislodged Netcom chairman and CEO Robert Rieger because, according to Rieger, “All Italians are hackers.” Yet, in spite of Netcom’s willingness to act behind the scenes to remove subscribers from the Net, they have maintained a totally contrary position in court and to the public. One might legitimately ask why.

Netcom seems to have become a victim of the very people that it provides with access to the Internet. The scheme of economic blackmail goes like this: if Netcom acts overtly to remove the violators, Internet anarchists will claim Netcom is stifling the “freedom of the net,” and run a campaign to persuade Netcom’s customers to change to a different access provider. Out of fear of financial loss, Netcom has apparently elevated revenues above the law.

Netcom’s greed is confirmed by further information made available to Freedom. When notorious criminal hacker Kevin Mitnick compromised 3,000 credit card numbers of Netcom customers, Netcom’s Reiger refused to warn the concerned customers. Reportedly there were other breaches that compromised personal information and involved more than 20,000 Netcom customer accounts. None of the subscribers were notified because Netcom was afraid that the scandal would adversely effect share prices in their initial public offering — in direct violation of SEC regulations requiring that potential investors be informed of information relevant to the stock value prior to consummation of the public offering.

Against that background of naked corporate self-serving opportunism, Netcom’s claims of principled motives to “protect free speech” are nothing more than a smoke screen to hide their true objective — making a buck at the expense of innocent people and the rights of law — abiding citizens to protection under the law. This is just another example of the need for ethical boundaries to be imposed on cyberspace. It is precisely these sorts of activities which jeopardize the Internet for everyone and threaten thorough legislative regulation.

But the courts are closing in on these abuses. A federal court in San Francisco issued a preliminary injunction against Internet user Chad Scherman and the “Maphia” bulletin board service after evidence showed that unauthorized copies of Sega video games had been uploaded onto the BBS, encouraged by Scherman who profited financially from the illegal postings. Scherman’s claim that his use was “fair” or for “educational purposes” was rejected by the court.

The Abuse of Anonymity

A more troubling side of high-tech abuse is anonymous postings. An Internet user, seeking to hide behind the cloak of anonymity, posts copyrighted material through another, known as a “remailer,” who acts as a conduit or relay point. The remailer strips the message or computer document of any identifying marks and posts it on the Internet.

Anonymous postings create a new problem, as the creator-author faces often-unsurmountable obstacles to obtain legal remedies against a person or persons infringing on his copyright when he cannot tell who is doing it.

Esther Dyson, member of the board of directors of the Electronic Frontier Foundation and member of the National Information Infrastructure Advisory Council, spoke on the anonymity issue at the fifth Computers, Freedom & Privacy (CFP) conference in San Francisco. “I have a concern about the spread of bad behavior on the Net,” said Dyson. “Anonymity figures into this, and I feel that it has proven to not be a positive factor. It breaks down the community which we are seeking to build, and could turn the ‘big cities’ of the information infrastructure into a big cesspool.”

Remailers who facilitate anonymous postings are part of the problem. They can act as conduits for those who seek anonymity as a way to act illegally without getting caught; yet remailers are able to shield themselves from responsibility or liability.

Computer experts stress that anonymous users should at least be trackable by the remailers — and that ones who act unlawfully can easily put the remailers at risk. Dyson noted that in self-regulatory schemes for almost any part of the Internet, “visibility, not anonymity, would have a strong place.”

An estimated $2.3 billion in software was anonymously pirated in 1993, much of it through the Internet, according to the Business Software Alliance. Leading consulting firm Ernst & Young conducted a study and found that 50 percent of 1,271 companies studied had suffered financial losses from computer security breaches and theft. And, with the Internet functioning and growing at a rate of up to 20 percent per month, this is sure to increase.

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