December 2003 - cypherpunks-legacy

Read; NOW
by Unix_Code 17 Dec '03

17 Dec '03

Hi I'm Unix Code and have a few things to ask...(it may not go with Cryptography but go ahead and read) ------------==------------------==-----------------==-------------------==------ [Bill Gates] What is wrong with him? I don't see any thing bad about him, instead I see the guy who helped the best computer system of all become the most used around the world. PC's. If he weren't here then probobly we'd be using Macs Instead, OR that we may be using a PC, But it's Super Expensive. I don't understand.. why people are so mad at him. Now... I may get tons of letters saying that you're wrong, and that he sux. But think about it. (I may also want to add..that the most known drink in at least [hacking] is jolt Cola (http://www.joltcola.com) and ya know what.... he drinks it too. [AOL and others] **NOTE: When I mention AOL..I mean all of the online services. I know I know... this is probobly going to be the most stupidest thing in the world...but I'm going to say it. Alot of people hate AOL because of the money you have to pay.. or people hate Prodidgy, CompuServe, etc. But lets put money aside.. (even though it's a big issue.) AOL is actually [with out the money] a great service. It has a 3.0 web browser which supports frames. It has great Libraries of software. Great Chat Rooms. Great Hackers. Great People. And it is a great atmusphere. and great [places.] Its money that's the problem. [Hackers] Either you are a hacker, general user, or cryptography person, or a curious user who wants to know alot of stuff from the advanced minds reading this mailinglist. so lets put it straight. A hacker is a person who can get arund the software. I am a hacker. I rate classes of hackers from A to F. A - Person who can get around the software, knows how to use it destructively, has hacked more than 10 times, has no care for family, and has a bad temper, never gets out of the house, and drinks jolt cola more than 5 times a day. B - Person who can get around the software, knows how to use it destructively, has hacked more than 5 times, has a bad temper, rarely gets out, and drinks jolt cola more than 5 times a day. C - Person who can get around the software, knows how to use it destructively, has hacked more than 3 times, has a bad temper, gets out twice a week, drinks jolt cola more than 3 times a day, and has a family. D - Person who can get around the software, knows how to use it destructively, has hacked 1 time, has a farely bad temper, gets out for work, drinks jolt cola more than 5 times a day, has an income, has a family. E - Person who can get around the software, Person who can get around the software, knows how to use it destructively, has hacked never hacked, has a controled temper, gets out for work and family, drinks jolt cola more than 3 times a day, has an income,and has a family. F - Person who can get around the software, has a controled temper, gets out for work and family, drinks jolt cola , has an income, and has a family. Z - Person who can get around the software, knows how to use it destructively, has hacked never hacked anything big, has a bad temper, gets out for family, drinks jolt cola more than 3 times a day, has no income, has a family, goes to school, stays on the computer forever. I am a Class Z Hacker. MayBe alot of people won't thinka hacker is Kevin Mitnick, but instead... Bill Gates. ------------==------------------==-----------------==-------------------==------ Thanks, ----UC 3-D by UC (Sux.. but I don't care!) ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ ^$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$^ ^$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$^ ^UUUUUUUUUUUU$$$$UUUUUUUUUUUU$$$$$$$$$$$$$$$$$CCCCCCCCCC$$$$$$$$$$$$^ ^$UUUUUUUUU$$$$$$$UUUUUUUU$$$$$$$$$$$$$$$$$$$CCCCCCCCCCCC$$$$$$$$$$$^ ^$UUUUUUUUU$$$$$$$UUUUUUUU$$$$$$$$$$$$$$$$$$CCCCCC$$$$$CCCC$$$$$$$$$^ vi@ ^$UUUUUUUUU$$$$$$$UUUUUUUU$$$$$$$$$$$$$$$$$$CCCCCC$$$$$$$$$$$$$$$$$$^ Em@il ^$UUUUUUUU$$$$$$$$UUUUUUU $$$$$$$$$$$$$$$$$$CCCCCC$$$$$$$$$$$$$$$$$$^ ^$UUUUUUU$$$$$$$$UUUUUUU$$$ http:// $$$$$$$CCCCCC$$$$$$$$CCCCCCC$$^unix_code@ ^$UUUUU$$$$$$$$$UUUUUU$$ www.geocities.com $CCCCCCCCCCCCCCCCC$$$$$^geocities ^$UUUUUU$$$$$$$$UUUUU$ /CapitolHill/2381/ $$$$cccccccccccccc$$$$$^.com ^$$$UUUUUU$$$$$$$UUUUU $$$$$$cccccccccc$$$$$$^ ^$$$UUUUUUUUUUUUUUUU$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$^ ^$$$$UUUUUUUUUUUUU$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$^ ^$$$$$UUUUUUUUUUU$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$^ ^$$$$$$$UUUUUUU$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$^ ^$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$^ ^$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$^ ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

2 1

Re: US Power Outages
by Bill Stewart 17 Dec '03

17 Dec '03

At 06:15 PM 8/11/96 -0400, Dave Farber wrote: >attempt to explain that blackout and how to prevent such. We have not >progressed very far. The avalanche behavior of power systems is still not >well understood and techniques to prevent such failures are not obvious. It surprises me how little these systems appear to be monitored. It took some hours for them to decide that the brush fire on the California border didn't cause the system to shut down; you'd think they'd know quickly that the subsystem shut itself down or disconnected from the grid or whatever because of reason #17... One of my concerns about the situation is that it's only a week or two after Clinton's speech about how The Government needs to protect the National Information Infrastructure for us. I'm not paranoid enough to think that they did it, but I'm sure that within a week we'll see Al Gore or somebody making an NII Protection Agency speech and Louis Freeh explaining that we need enhanced wiretap underwriting to make sure that encryption-wielding hackers don't do it again. >As someone who was married in NYC during the 65 blackout *happened at 1716 A former boss of mine was on his honeymoon cruise in the Caribbean and pulled into scenic Havana harbor the day of the Revolution.... # Thanks; Bill # Bill Stewart, +1-415-442-2215 stewarts(a)ix.netcom.com # <A HREF="http://idiom.com/~wcs"> Defuse Authority!

1 0

Re: National Socio-Economic Security Need for Encryption Technology
by James A. Donald 17 Dec '03

17 Dec '03

At 08:02 PM 8/11/96 -0400, Perry E. Metzger wrote: > Clearly, wages are defined by supply and demand -- not by "capital > investment". However more capital, relative to labor, influences demand, and more labor, relative to capital, influences supply. But in practice, the mobility of capital and the importance of labor is such that this has little effect. How much capital do you need to provide a job for a software engineer? The major determinant of someones value on the international market is who has coercive power over him, not the national supply of capital. Capital does not come from nations, but from individuals. --------------------------------------------------------------------- | We have the right to defend ourselves | http://www.jim.com/jamesd/ and our property, because of the kind | of animals that we are. True law | James A. Donald derives from this right, not from the | arbitrary power of the state. | jamesd(a)echeque.com

1 0

Unmetered Net Usage
by tcmay＠got.net 17 Dec '03

17 Dec '03

At 6:34 AM 8/12/96, Rabid Wombat wrote: >(no crypto here, so delete it already) :) A good rant, in the best sense of the word. >players will be the same as today, that depends. If the railroads had >realized that they were in the transportation business, instead of the >train business, they'd be flying airplanes today. I've heard this example used for years, and I'm skeptical. The methods and experts needed by early aviation companies were completely different from the methods and experts the railroad companies had; I'm not convinced that deciding one is in the "transportation business" is the key. >Anyone that wants to carry a large volume of traffic via the 'net will >find that either the market will dictate that they pay for the bandwidth >they use, or the FCC will. I don't see the FCC getting involved, unless >the "phone service via internet" providor tries to use the courts to get >out of paying for the bandwidth they use. They'll be restricted by the >size of the "pipe" they purchase from their ISP, and the ISPs all charge >more for access from larger "pipes." If they lease their own >cross-country circuits, they'll pay the same (or higher) costs as the Telcos. I see zero chance a local ISP will attempt to use the courts to "get out of" a charge he has incurred. For one thing, his supplier can simply say "you don't pay, you get cut off," and be supported by the courts. For another, even the ISP may not be able to simply tell which customers are using telephony programs and which are just dowloading pictures of Christy Canyon. Will "unmetered" usage go away? It depends on a lot of factors. Right now, unmetered usage is a big enough marketing draw that it appears to outcompete metered usage plans. Sure, there are people like me who pay a flat rate (in my case, $20/month) and yet who are on for several hours a day. But the subscribers who also pay the $20/mo and yet who are on only briefly to check their mail are not clamoring to switch to metered usage. If Internet telephony becomes a big deal, I still suspect unmetered usage will be common. If the capacity isn't there, from the ISP through the various links to the other person's ISP then there will be stalls and delays. Think of it as evolution in action, like crowded freeways. --Tim May Boycott "Big Brother Inside" software! We got computers, we're tapping phone lines, we know that that ain't allowed. ---------:---------:---------:---------:---------:---------:---------:---- Timothy C. May | Crypto Anarchy: encryption, digital money, tcmay(a)got.net 408-728-0152 | anonymous networks, digital pseudonyms, zero W.A.S.T.E.: Corralitos, CA | knowledge, reputations, information markets, Licensed Ontologist | black markets, collapse of governments. "National borders aren't even speed bumps on the information superhighway."

2 1

Re: problem software
by dlv＠bwalk.dm.com 17 Dec '03

17 Dec '03

ARCHFIEND <sven(a)loop.com> writes: > >we have problem software looming on the horizen here. > >does anyonw have the expertise to write any > >anti-lightening.bolt software that can disable > >or disengage these e-mail address collectors? > > We come face to face with our old problems organization and consistency. If > we want to "stop" lightning bolt and other programs like this (6 hours of > coding for anyone halfway to reality), we have to stop its profitability by > 1) boycotting advertisers and 2) assiduously, consistently, mailbombing the > fuck out of their addresses until their ISPs drop them. Hey - we just got back from a trip, it's good to see all your guys back online. I think one way to fightt junk e-mail is to do what I proposed: have a "don't-e-mail" list available for FTP, and make it trivial to add one's address to it. I can talk more about how I envision this if anyone is willing to consider putting such a thing up. I honestly don't think lightening&co want to e-mail people who don't want to be e-mailed. --- Dr.Dimitri Vulis KOTM Brighton Beach Boardwalk BBS, Forest Hills, N.Y.: +1-718-261-2013, 14.4Kbps

1 0

Netscape US betas lagging...
by Rich Graves 17 Dec '03

17 Dec '03

-----BEGIN PGP SIGNED MESSAGE----- The international version is 3.0b7. The export-controlled version on wwwus is two revisions and almost a month behind at 3.0b5. Have y'all simply not had time/inclination to recompile the 128-bit version with the latest patches, or is there some sort of trouble brewing? - -rich -----BEGIN PGP SIGNATURE----- Version: 2.6.2 iQBVAwUBMg7ft5NcNyVVy0jxAQGLNAIAwf9BqKx+kHjfN/4YRfjHhXsqv8S6qbQ2 DiotNQxH/rrauDWOzh5TaTTgUp+0syzWKIvQtXUZC1+9JduWK39d6w== =W2nf -----END PGP SIGNATURE-----

2 1

[off-topic] Re: US Power Outages
by shamrock＠netcom.com 17 Dec '03

17 Dec '03

At 22:24 8/11/96, Z.B. wrote: >>From what I read, this wasn't a "small localized disturbance". >Apparently, a fire underneath one of the main towers on the CA-OR border >was the cause of the problem. Now that may not sound like too much, but >the lines were carrying at least 3000Mw of electricity, enough "to power >3-1/2 Seattles for a day" (quote from local newspaper). My guess is that >when there is a problem involving that much power with no place to go, >the safety systems shut everything down to prevent damage. It was a disturbance at a single power line. By any standard, this should not lead to a blackout from Canada to Mexico. Does anybody here have some first hand knowledge about power transfer at the scale of the US grid? -- Lucky Green <mailto:shamrock@netcom.com> PGP encrypted mail preferred. Defeat the Demopublican Unity Party. Vote no on Clinton/Dole in November. Vote Harry Browne for President.

2 1

Re: Read; NOW
by Charley Sparks 17 Dec '03

17 Dec '03

-----BEGIN PGP SIGNED MESSAGE----- To: proff(a)suburbia.net, cypherpunks(a)toad.com Date: Mon Aug 12 05:34:05 1996 Perhaps this UNIX_CODE wants to create a mailing list with out names on it.. if we reply to him...... -----BEGIN PGP SIGNATURE----- Version: 2.6.2 iQCXAwUBMg76juJ+JZd/Y4yVAQFT0AQMDvQgn8c1bNhpZ16Niqbdho71jCeyTV0I z5o5NPnSspEUhhxI3CIMp0OVwThaAOpRPakL8Pm6pjc08tgr0Hjbg0d0zFvVVDcM Wkh6mSCYXFIEz043ZDiSuYQuY8Zs8ChiBTTElJQM5Ns2j6O1jYyiogGwSgVTszvV TCj9PWFovL5VHQ== =DVBI -----END PGP SIGNATURE-----

1 0

Re: US Power Outages
by mccoy＠communities.com 17 Dec '03

17 Dec '03

Lucky (crypto-leprechaun) wrote: > At 18:15 8/11/96, Dave Farber wrote: > >The avalanche behavior of power systems is still not > >well understood and techniques to prevent such failures are not obvious. > >Same can be said of telephone and computer networks at different levels. > > Does somebody here have a pointer to literature on this topic? A system in > which small localized disturbances can amplify, propagate through the > system, leading to catastrophic failure is the worst of all possible > designs. I fail to understand why a system as important as the power grid > would display this type of behavior. Why is the grid negatively dampened? Because the system designed to fail non-destructively rather than risk a power surge. Part of the problem is that the power being controlled moves as fast as any information about the state of the network: all decisions must be made locally at the switch level. When a major line fails the power generation stations can not just "turn off the juice" at the speed required, the power must either be redistributed or else the switch overloads and shuts down to prevent a massive power spike. The power companies would rather face the ire of consumers without power for an evening than the outcry that would happen if every toaster, microwave, and computer on the west coast was fried by the spike caused by 3 gigawatts being dumped into grids that could not handle the load (not to mention the long-term blackouts caused by local switching equipment getting fried.) In this case the system must fail to prevent damage. The great east coast blackout was caused by a $50 switch which wore out. The switch happened to control a chunk of load which was re-routed on to another line, causing a cascade failure as the excess load caused other switches to fail when it was dumped on to those lines (and the excess load caused by these other switches tripping accellerated the failure.) Power distribution is not like telecom, if a phone switch dies the calls end; the failure does not endanger the upstream switch with overload from bits not going anywhere. Imagine that cars on highways had no brakes until they reached an offramp but the DOT could apply a kill-switch to segments between offramps (tying this thread into another non-crypto thread on the list :),if a failure in the roadway caused traffic to stop then all of the upstream traffic would have to be dumped off the road via offramps that were only one or two lanes. This would cause further bottlenecks and the kill-switch would need to be applied to more and more segments upstream to prevent the traffic stopped or being slowly bled off from causing more problems. No imagine that offramp-to-offramp messages were transmitted via messengers travelling upstream in the carpool lane :) Even the power company's secret experiments in the cores of nuclear reactors have not found a way to get around the 186,000 km/s speed limit on everything. jim

2 1

Re: Rumors of death of Anguilla Data are greatly exagerated.
by Duncan Frissell 17 Dec '03

17 Dec '03

At 01:37 PM 8/11/96 -0400, Vincent Cate wrote: >If the laws of a country say it is fraud to open a bank account with >a fake passport, then encouraging someone to do so is encouraging >fraud. Check with your lawyer and see if you can open up a bank >account with a fake passport. My lawyer says that at common law you can use any name to open an account as long as there is no intent to defraud. Since I am giving the bank money and not vice-versa, it can't be common law fraud. I'm lending to them. They aren't lending to me. It *is* illegal in the US for the bank to open an account for me without some ID checks, but it is not *my* problem and it is not fraud. DCF

2 1

Article on Electronic Commerce with a few too many assumptions
by E. ALLEN SMITH 17 Dec '03

17 Dec '03

I haven't had time to do more than skim over the following article, but I can already see some problems with it. For instance, he mentions CD places not allowing agent searching - but with increasing development of anonymization and like technology, will they have any choice? -Allen [Permit me to recommend that you read this very interesting draft paper and send its author, Andrew Odlyzko, detailed comments.] =-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-= This message was forwarded through the Red Rock Eater News Service (RRE). Send any replies to the original author, listed in the From: field below. You are welcome to send the message along to others but please do not use the "redirect" command. For information on RRE, including instructions for (un)subscribing, send an empty message to rre-help(a)weber.ucsd.edu =-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-= Date: Fri, 9 Aug 96 14:17 EDT From: amo(a)research.att.com Subject: electronic commerce article Enclosed is the draft of an invited paper for the WebNet '96 conference to be held in San Fransisco, Oct. 16-19, 1996, URL http://aace.virginia.edu/aace/conf/webnet.html. Comments are invited. Andrew Odlyzko The bumpy road of electronic commerce Andrew Odlyzko AT&T Labs - Research amo(a)research.att.com Preliminary version, August 9, 1996 Abstract: Electronic commerce is widely expected to promote "friction-free" capitalism, with consumers sending software agents to scour the Net for the best deals. Many distribution chains will indeed be simplified and costs substantially reduced. However, we are also likely to see the creation of artificial barriers in electronic commerce, designed by sellers to extract more value from consumers. Frequent flyer mileage plans and the bundling of software into suites are just two examples of the marketing schemes that are likely to proliferate. It appears that there will be much less a la carte selling of individual items than is commonly expected, and more subscription plans. Therefore many current development plans should be redirected. Electronic commerce is likely to be even more exasperating to consumers than current airline pricing, and will be even further removed from the common conception of a "just price." As a result, there are likely to be more attempts to introduce government regulation into electronic commerce. Footnote: This paper incorporates material from an earlier article on electronic publishing, [Odlyzko]. 1. Introduction Electronic commerce (or ecommerce for short) is still small, at least if we consider only online consumer transactions, such as ordering a book from amazon.com over the Internet. In a broader sense, ecommerce is much larger, since financial, news, and legal information services such as Bloomberg, Reuters, and Lexis have total revenues in the billions of dollars. In a still broader sense, electronic funds transfers are already huge, with daily transactions in the trillions of dollars. All these types of transactions are expected to grow, and to become part of a much larger and uniform system of electronic transactions. While we are rapidly moving towards the Information Age, food, shelter, and clothing will remain our most important needs. However, their shares of the economy are decreasing, and the information content of their goods is increasing. This is an old trend. Agriculture has moved from being the largest segment of the economy a century and a half ago to a relatively minor industry, dwarfed by the medical sector, for example. Furthermore, the cost of the basic ingredients in cereals and other foods is a small portion of the total price. As a further example of the decreasing value of raw materials and factory labor, a single celebrity is often paid as much for endorsing an athletic shoe model as all the workers in the undeveloped countries who assemble those shoes. We can expect a continuation of this trend, with the work of the "symbolic analysts" (who, in Robert Reich's terminology, include lawyers, software writers, and advertising executives) making up increasing fractions of the economy. The main concern of this essay is electronic trade in information goods, such as news, novels, software, music, movies, as well as legal, medical, and credit information. How will these goods be distributed, and how will their production be financed? Esther Dyson [Dyson] predicts that almost all intellectual content will be available for free. In her view, some content production will be supported by outside advertisers (who already pay for most of the cost of newspapers, for example, as well as all the costs of the commercial TV networks). Some content will likely be made available for free, as a form of advertising for other services by the producers (as the Grateful Dead do in encouraging people to tape their performances, in the hope this will bring more people to their concerts). While Dyson's vision will come true for a large part of the material on the Net, it seems unlikely that it will be universal. Movie studios such as Disney attract large paying audiences to theaters and purchasers to their videotapes through the quality of their products, and are likely to do so in the future. While some novelists make more money from selling movie rights to their plots to Hollywood than from royalties on books, this is rare. Each year, over a hundred times as many books are published as there are movies produced, and the sales of books are much higher than movie theater revenues. Thus we can expect that content producers will usually want to be paid directly for their work, as that will be the only feasible route to earning a living. Furthermore, Dyson herself [Dyson] emphasizes that much of the value on the Net "will go to the middlemen and trusted intermediaries who add value - everything from guarantees of authenticity to software support, selection, filtering, interpretation, and analysis." How will these middlemen be paid? It seems likely that often they will wish to collect payment directly from consumers, just as the online legal information service Westlaw collects fees from attorneys who use it. The basic data in Westlaw is court opinions, which are freely avaialable. What gives Westlaw its lock on the market is the control of its citation system. Many of Dyson's predictions are likely to come true. In particular, huge amounts of intellectual property will be available for free. However, it seems likely that there will also be a flourishing ecommerce sector, with individuals purchasing goods and services. The question is, how will ecommerce be conducted? The usual expectation is that ecommerce will promote "friction-free capitalism," (cf. [Gates]), with distribution costs reduced. It is easy to see how this can happen, as the older communication systems such as the post office, the telegraph, the telephone, and the fax have all served to make the economy more efficient. The Internet creates many more possibilities. Classified ads, for example, bring in a large fraction of the revenues of the newspaper industry, but can be replaced by a much cheaper and easier to use electronic system. Other part of the common vision of ecommerce are more questionable, however, and that is what the rest of this essay will discuss. It is often thought that instead of buying an entire newspaper, readers will pay for those individual stories they are interested in. Someone wishing to purchase a VCR might send an "intelligent agent" into the Internet to collect bids from suppliers for a unit that meets desired specifications, and then select the best choice. While such scenarios will be feasible technically, it is extremely unlikely they will be dominant. Instead, we are likely to see a proliferation of policies such as those of current music CD retailers who sell on the Internet. Most of them do not allow software agents to collect their prices. We are also likely to see a strenthening of the trend towards subscription services and bundling of products, as is done in software suites today. This will often require redirection of development efforts. This essay is devoted largely to an explanation of the economic reasons that are likely to lead to the creation of "bumps" on the electronic superhighway. These reasons operate already in the current economy, and are responsible, for example, for the U.S. airline pricing system, which is a source of frequent frustration and complaints. In ecommerce, frustration and complaints are likely to be even more frequent. The reasons for this are twofold. On one hand, the economic incentives to create artificial barriers will be greater in ecommerce than today, since essentially all costs will be one time costs of creating goods, and distribution will be practically free. On the other hand, it will be much more transparent that the barriers are artificial. This will often collide with popular notions of what is fair, and is likely to lead to attempts at much more intrusive government regulations than we have seen so far. In the past governments have been involved primarily in security issues of the Net, and more recently have gotten concerned about pornography. However, in the future they are likely to attempt to regulate the conduct of business on the Net as well. If the predictions of this essay come true, then some of the current development efforts will turn out to be misdirected. In particular, there is likely to be much less use of micropayments for individual transactions, and more subscription services, which require different systems. Also, it will be necessary to prepare to comply with edicts from various governments which will be changing and will often be inconsistent. 2. Natural and artificial barriers in commerce Capitalism is excellent at inducing people to reduce barriers to commercial activities. However, it also produces incentives to create artificial barriers. Some of the barriers are created by government action, such as those of patent and copyright laws, which give owners of intellectual property a limited legal monopoly on the uses of their creations. Other barriers are created by merchants. It is common for an airline passenger to have paid 5 times as much as the person in an adjacent seat, with the only difference between the two being that the first one is not away from home on a Saturday night. The airlines would like to charge the business travelers (who are presumed to be able and willing to pay) more than vacationers (who might drive a car instead or not travel at all), but do not have a direct way to do so. Therefore they impose the Saturday night stopover restrictions to distinguish between those two classes of customers. There have been several attempts by airlines to move towards a simpler system of uniform pricing (sometimes by newcomers, such as People Express, sometimes by established carriers), but they all collapsed. This suggests that there is an underlying economic logic behind this system, however exasperating it might be. If that is so, though, we can expect similar moves in ecommerce. The general tendency in the marketplace is to avoid "commoditization," in which there are many almost equivalent products and services, and where price is the only consideration. Ford does not compete with Honda in producing the most inexpensive Accord. Instead, it offers the Taurus as an alternative, and there are many features in which the Accord and Taurus differ. Sometimes commoditization is hard to resist. In some cases this happens because consumers learn there is little to differentiate products. As an example, oil companies have pretty much given up on trying to convince people that gasoline differs in anything other than octane ratings. In other cases, commoditization is forced on an industry by government edict or effective private monopoly. Intel and Microsoft have reduced the IBM-compatible PC industry to a commodity business, in which they collect almost all the profits, and the other players scramble to find a niche that will enable them to do more than just break even. However, those are the exceptions. The general ecological principle is towards evolution of species that fill different roles. Zebras do not attempt to compete with giraffes, but exploit a different part of the ecosystem, and evolution does not lead to a convergence of those two species. Similarly, in the world of business, companies try to differentiate their products. Workstation producers could never in the past agree on a common version of Unix, even under the threat of being overwhelmed by PCs, since that would have required giving up the distinctive features that bound them to their customers. Even airlines, which are basically in the commodity business of moving people from one city to another, try to differentiate themselves through frequent flier plans and special pricing schemes. Ecommerce is likely to lead to a proliferation of pricing plans that will seem to most people to be much more frustrating and less rational than even today's U.S. airlines. There will probably be a niche market for people who care most about their convenience, and will use their intelligent agents to do their shopping for them. However, what Sony, for example, might do is sell to that market only models of VCRs that are not available elsewhere, and are hard to compare to those sold in other places. Stores that have physical buildings are likely to serve a different clientele, and might also take further steps to differentiate themselves to prevent comparison shopping, which will be much easier with many people sharing their experiences on the Internet. There is likely to be a proliferation of frequent-shopper plans. Further, Sony VCRs sold in Sears stores might be slightly different from those sold in WalMart, and model numbers and features might change rapidly to inhibit consumer rating services (such as Consumer Reports, or various Internet-based group-rating schemes that are beginning to develop). There are already artificial barriers to free information flow. Grocery stores routinely bar employees of other stores from collecting extensive data on prices. The policy of Internet CD stores of preventing software agents from collecting prices for comparison shopping is just an extension of such barriers to free information flow to ecommerce. We can expect more such barriers. While barriers to commerce of the type discussed above are usually perceived as unfair (an issue that I will deal with more extensively in the last section), they can increase not just the producers' wealth, but economic efficiency and social welfare. As a simple example, consider an independent consultant who can produce a technical report that two different customers might be willing to pay $3,000, and $2,000 for, respectively. If she has to charge a uniform price to the two customers, the most she can get is $4,000, obtained by pricing the report at $2,000. However, if she charges the first customer $3,000, and the other $2,000, she will earn $5,000. If the consultant's time and expenses to prepare the report are worth $4,500, she will not undertake the effort if a uniform price is required. >From an economic viewpoint it is therefore advantageous to allow her to charge different prices to different customers. However, the customer that pays $3,000 is likely to resent it if somebody else obtains the same product for $2,000, and often will not agree to the deal if all conditions are publicly known. This is caused by a conflict between notions of economic efficiency and fairness. There are many examples in the marketplace of behavior that appears even less fair. For example, in 1990, IBM introduced the LaserPrinter E, a lower cost version of its LaserPrinter. The two version were identical, except that the E version printed 5 pages per minute instead of 10 for the regular one. This was achieved (as was found by independent testers, and was not advertised by IBM) through the addition of additional chips to the E version that did nothing but slow down processing. Thus the E model cost more to produce, sold for less, and was less useful. However, as Deneckere and McAfee show in their paper [DeneckereM], which contains many more examples of this type (referred to as "damaged goods"), it can be better for all classes of consumers to allow such behavior, however offensive it might be to the general notions of fairness. Consumers who do not need to print much, and are not willing to pay for the more expensive version, do obtain a laser printer. Consumers who do need high capacity obtain a lower price than they might otherwise have to pay since the manufacturer's fixed costs are spread over more units. Barriers in commerce are an essential part of the current marketplace. Consider the book trade. Although people do not think of it this way, current practices involve charging different prices to different users, and thus maximizing revenues. A novel is typically published in hard cover first, with the aim of extracting high prices from those willing to pay more to read it right away. Once that market is fully exploited, a somewhat cheaper trade paperback edition is made available, to collect revenue from those not willing to pay for the hardbound copy. Finally, a regular paperback edition is published at an even lower price. The used book market develops in parallel, for those willing to read books marked up by previous owners, and so on. How will ecommerce affect book publishing? Eventually we can expect that all books will be available electronically (and will evolve towards new forms, made possible by digital communications). Costs of publishing will come down, and this is going to increase the supply, and lead to many works distributed for free, by aspiring authors hungry for the recognition that might lead to fortune. What about those electronic books that people will be willing to pay for? With publishing costs reduced, we can expect that the authors' share of the revenues will rise, say from the current 15% or so royalty rate to 50% or more, and so in effect the authors might become much more influential than the publishers (or might become the publishers themselves). However, since publishers obviously benefit from the present system of differential pricing, they (and the authors) are likely to have an incentive to institute a similar system in the digital arena. The issue is how to do this. Bits are bits, after all, and are easy to copy. If we make only simple extensions of current copyright laws, we are likely to see a great change in the marketplace for information goods. For example, when I buy a book, I cannot make a copy of it and sell that copy to somebody else. On the other hand, I can sell, rent, or give away the book I purchased to anyone I wish. Suppose we carry over exactly the same rights to the digital world, with some combination of cryptographic techniques and laws guaranteeing that unauthorized copies of digital "books" cannot be made. The ease of transactions on the Net (which is what leads to the dreams of "frictionless capitalism") would then force major changes. With physical volumes, there are substantial barriers to trade in books. Most people do not like reading books that are tattered or marked up by others. They take their time reading books, and (especially for the ones they enjoy) like to retain them in their libraries to be reread any time they wish. As a result of these natural barriers, a single copy is usually read by only a few people. The economics of the present book publishing business depend on this phenomenon. In the digital world, though, with high bandwidth networks and efficient intermediaries, I could buy a copy of a book an hour before bedtime, read a new chapter, and then, just before turning off the lights, send that copy off for resale. Instead of a million copies of a printed book, a thousand electronic copies might suffice. This would force a dramatic change in the structure of the book publishing industry, and explains why there is an intense interest in the creation of artificial barriers to ecommerce, either through revisions to copyright laws or through technological methods. 3. The bumps on the electronic highway Some types of barriers to commerce are accepted as natural when dealing with physical goods. It would be prohibitively expensive for the New York Times, say, to distribute 100 little sheets each day, each one with a separate story, and having readers buy just the ones they were interested in. The accepted wisdom is that ecommerce will lead to the electronic equivalent of just that, with readers selecting and paying for individual stories. It will certainly be possible to do so, as micropayment systems are being developed that will allow for processing of tiny transactions, such as payment for a single story in the New York Times, or a "hit" on some aspiring poet's Web page that contains his sonnets. However, the economic argument is that while such schemes might exist, and may be used in some situations, they will not be dominant. The example of book publishing in the previous section shows why producers of information goods benefit from the natural barriers that exist in the physical world. Their incentives to create artificial barriers in the digital world will be even stronger. It will be harder to distinguish between consumers, since transactions will tend to be impersonal, and arbitrage will be easy. Most important, distribution costs will be negligible, so that only the "first copy" cost of creating a work will matter. Hence traditional, commodity-market type of competition, in which the market price equals the marginal cost, will have to be avoided, since marginal prices will be essentially zero. The incentive that low marginal costs provide to create barriers in commerce can already be seen in many high technology fields. The "damaged goods" studied in [DeneckereM] come primarily from such areas. The pharmaceutical industry is notorious for selling products for hundreds of times more than the cost of producing them, and for selling the same chemicals for human use for ten times the price charged for veterinary purposes. While the incentives to erect artificial barriers will be large in ecommerce, there will also be novel possibilities created by the electronic medium. What kinds of barriers are we likely to encounter in ecommerce? The four most important ones will probably be bundling, differential pricing, subscriptions, and site licensing. Hal Varian [Varian3] discusses the first two in detail, and argues convincingly that they will be prominent in ecommerce. In the rest of this section I will present some additional arguments for these techniques, and will also show why subscription services (which are a form of bundling, but are important for other reasons as well) and site licensing are also likely to be common. There are additional arguments in favor of subscription and site licensing plans. For example, security problems are likely to be easier in those cases. However, this essay will deal only with the economic arguments. The basic assumption in the economic analyses below is that for each information good, an individual consumer will purchase it only if the price is below some threshold (that consumer's valuation of the good). For simplicity, I will only consider items that are independent of each other (such as stories in a newspaper). Much of the economic literature cited below is concerned with goods that are related in one way or another. (For example, if I buy a spreadsheet from Corel, I am unlikely to purchase another one from Microsoft. On the other hand, if I buy a presentation package, I am more likely to buy a CD-ROM of pictures than I would otherwise.) I will not take these factors into consideration, to keep the presentation simple, and bring out only the main factors that are likely to influence the development of ecommerce. I will also assume that producers cannot in general find out what an individual is willing to pay for a product, but can, through test marketing, say, obtain an accurate statistical description of the valuations that the whole population of potential buyers place on that product. 3.1 Bundling Bundling consists of offering several goods together in a single package, such as combining a word processor, a spreadsheet, and a presentation program in a software suite (such as Microsoft Office), or else printing many stories in a single newspaper. Bundling is common, and often seems natural. For example, right shoes and left shoes are invariably sold together, and just about the only time anyone might regret this is when a dog chews up one of a new pair of shoes. I will concentrate on bundling of goods that are almost unrelated, such as a word processor and a spreadsheet program. Why should the pair of them together sell for much less than the sum of their separate prices? It is useful to have seamless integration of the two, to make it easier to move material between them, to have common command structure and icon layouts, and so on. That seems to argue for charging more for the bundle than for the pieces! However, bundling, with a lower price for the bundle than for the components, or even without any possibility for purchasing the components separately, is extremely common. The reason is that it allows the producer to increase revenues by capturing more of the "consumer surplus" that arises when customers pay less than they are willing to do. Since in general prices have to be the same for all customers, bundling can be used to smooth out the uneven preferences people have for different goods and services. For example, suppose we were dealing with a proposal to start a newspaper that would have two sections, a business page and a sports page. Suppose also that there were just two potential readers, Alice and Bob. Suppose also that Alice needs to keep up with the business world, and so is willing to pay $0.50 for the business page, but only $0.20 for the sports page, since she does not particularly care about sports, but might like to keep up with lunchtime conversations. Suppose that Bob's preferences are reversed, in that he is an eager sports fan, willing to pay $0.50 for the sports page, but only $0.20 for the business page, since all he cares about is occasionally checking on his retirement fund. Under those conditions, how should the proposed newspaper be priced? If each section is sold separately, then a price of $0.20 for each will induce both Alice and Bob to buy both sections, for total revenues of $0.80. If the price is set at $0.50 for each section, then Alice will buy only the business page, and Bob only the sports page, for total revenue of $1.00. On the other hand, if the two sections are bundled together, then a price for both of $0.70 will induce both Alice and Bob to purchase the newspaper, and will produce total revenues of $1.40. Thus the economically rational step is not to offer the two sections separately, but only bundled together. Bundling has been studied extensively in the literature, starting with the paper of Burnstein [Burnstein]. Other references are [AdamsY, Bowman, Economides1, KrishnaKA, Schmalensee, Stigler, Varian2, Wilson1, Wilson2]. Unfortunately there is no simple prescription that can be given as to when bundling is better than selling items separately. Depending on the distribution of consumer preferences, bundling can be either more or less profitable for the producer, as was already shown by Adams and Yellen [AdamsY]. However, there are some general guidelines. One is that bundling becomes more profitable as marginal costs decrease (which may be part of the reason for the spread of software suites as the amount of unpaid support provided to users by software houses decreased). Another is that bundling becomes more attractive when consumer preferences are negatively correlated (as in the example above, where Alice and Bob had almost opposite tastes). However, negative correlation in valuations is not necessary for bundling to be profitable, as was first pointed out by Schmalensee [Schmalensee], and as will be shown in the example below. Random variations in preferences are sufficient as a result of the law of large numbers. How much of a difference can bundling make to a producer's bottom line? Unfortunately the published literature is practically silent on this point, for reasons I will discuss later. (There is an intriguing computation in [Stigler], based on reported revenues of movie theaters in different cities.) Let us therefore consider some artificial examples, a bit more realistic than the Alice and Bob one presented above. Consider two books, A and B, say "The Tannu-Tuva Cookbook" and "Sherlock Holmes in Antarctica." Suppose that among one million potential customers, book A is valued at $1 by 100,000, at $2 by another 100,000, and so on, up to $10 by 100,000, and suppose the same distribution of valuations applies to book B. Suppose further that the valuations of the two books are independent. Thus there are about 10,000 customers who value book A at $3 and simultaneously book B at $5, and similarly about 10,000 customers who place values $9 and $2 on A and B, respectively. Under these conditions, if the publisher is to sell these books separately, revenue will be maximized when the price of each is set at $5. About 600,000 people will purchase each book, for total revenue from sales of both books of $6,000,000. (This maximum is not unique, as the same revenue can be achieved by pricing each book at $6, in which case about 500,000 people will buy each.) However, if the two books are sold together, revenue can be made much higher. Since there are 10,000 people who value the bundle at $2 (exactly the 10,000 who value each book at $1), while there are 90,000 who value it at $10, a short calculation shows that the revenue-maximizing price is $9. At the price of $9 per bundle, 720,000 people will purchase it, for total revenue of $6,480,000, exactly 8% higher than if the books were sold separately. Since profits would be the revenues minus the fixed costs of producing the books, they would increase much more dramatically. What weakens the case for bundling is that most people have no interest in most goods. In the example of the books "Sherlock Holmes in Antarctica" and "The Tannu-Tuva Cookbook," a more realistic assessment might be that in a population of 1,000,000, each book would be valued at zero by 90% of the population, with 10,000 valuing it at $1, 10,000 at $2, and so on. If the 100,000 people who do place a positive value on book A are distributed independently of those who value book B at $1 or more, then there would be only 10,000 people who place positive values on both A and B. Bundling under these conditions would not produce much benefit. However, even in cases of extreme indifference, bundling can work if there are enough goods. Consider an information service with 1,000 items (news stories, pictures, or songs). Suppose that in a large population, each individual is totally uninterested in 900 of the items, and values 10 at $0.01 each, 10 at $0.02 each, and so on, with 10 valued at $0.10 each. If the items are to be sold individually, the revenue-maximizing price will be $0.05 for each (or $0.06 each), and each customer will purchase 60 items for a total of $3.00. However, if the collection is sold as a whole (which involves no extra cost to producers of information goods, and also no cost of tossing out mounds of unwanted boxes to consumers), then a price of $5.50 will induce each person to buy, for a gain of 83% in revenues (and much more in profits). So far we have compared only sales of unbundled products (pure unbundling) to those of bundles (pure bundling). However, it is often advantageous to use mixed bundling, where both bundles and separate goods are offered. In the example of the books "Sherlock Holmes in Antarctica" and "The Tannu-Tuva Cookbook," with the distribution of valuations assumed above, a price of $10 for the bundle and $5 for each book separately would produce revenue of $7,400,000, about 14% higher than pure bundling, and over 23% higher than pricing the books separately. (Note that the optimal combination above has the paradoxical property that the price of the bundle is exactly the price of the pieces. Under the assumption of the model, people who value book A at $7 and book B at $3 will purchase the bundle, but if the bundle is not available, will only purchase A.) Adams and Yellen [AdamsY] have shown that mixed bundling is always more advantageous to the producer than pure bundling. Toy models like the one above are amusing to play with, and help illustrate the advantages to producers of bundling. If the distribution of consumer valuations is known, one can determine numerically what the optimal policy is for the producer [Wilson1, Wilson2]. Unfortunately the basic assumption that consumers know what value they place on various goods, and purchase them precisely when the price is below their value, is questionable. In practice people behave in much more complicated ways. An old joke illustrates this: Waiter: And for dessert, we have chocolate mousse, apple pie, and ice cream. Customer: I will have apple pie. Waiter: Oh, I forgot to mention that we also have Peach Melba. Customer: In that case I will have the mousse. While this is a joke, actual behavior is often just as paradoxical. Catalog merchants have learned that the attractiveness of an item is affected strongly not just by its price and description, but also by its placement among other offers. Consumer choices are complicated. Some of the seemingly irrational behavior can be explained on the basis of different consumers having different sensitivities to prices. For example, the phenomenon of regular sales has been modeled successfully this way in [Varian1] and later papers. Other interesting phenomena emerge if one assumes that consumers do respond to price signals in an economically rational way, but with some delay (see [RichardsonR], for example). However, there is no complete theory. Experimental economics has shown that economically optimal solutions can be attained even with small groups of agents, provided they are working in a constrained environment and are trying to optimize their wealth, although even there paradoxes abound (cf. [CookL, HagelR]). In general settings, though, human behavior is hard to model. There are nontransitivities in preferences, choices are determined by behavior of others (so a person is more likely to see a movie that colleagues have seen to have something to talk to them about), and so on. Companies collect extensive data from test marketing, but that data is noisy, and typically involves only small variations in test parameters. There seems to be no unambiguous empirical demonstration that a well defined demand curve exists. Thus economic models discussed above do indicate that bundling is likely to be advantageous to producers, but do not prove this. What happens in the real marketplace, with a variety of customers and competitors, and where there is already much experience with a variety of marketing plans? What we see there is extensive evidence of bundling. In many situations, such as that of physical newspapers, there is an obvious motivation for bundling to reduce costs. However, there is also evidence of bundling's success when there are practically no physical costs involved. Software suites such as Microsoft Office are just one example. Cable TV does not charge for each channel separately, but for packages (bundles) of them. Finally, the big and profitable online information services in the financial and legal arena, such as Reuters, Bloomberg, and Lexis, all operate on a subscription basis or appear to be moving in that direction. (The "pay-per-view" approach made more sense when the computing infrastructure for online access was expensive, and therefore there were high marginal costs of providing access.) All this evidence confirms that bundling is likely to be common in ecommerce. 3.2 Differential pricing Charging different prices to different consumers is already common. Various senior citizen or student discount programs are just some of the most widely spread practices. Scholarly journals typically charge much higher prices to libraries than to individuals, sometimes 10 times higher. For a thorough discussion of such price discrimination and its economic and legal status, see the survey [Varian2]. A producer would like to charge according to the consumer's willingness to pay, but the consumer will usually be reluctant to reveal such information. However, it is sometimes possible to correlate willingness to pay with other features. Airlines offer much cheaper tickets for those willing to be away from home on Saturday night. The theory is that business travelers, who are willing to pay a lot, will not be willing to put up with such inconvenience. In information services, online services such as Prodigy and CompuServe offer stock market quotes that are delayed by 15 or 20 minutes for no extra cost, beyond the basic subscription. Real-time quotes uniformly cost extra, on the theory that those who need them for their trading will pay more. The software industry relies on differential pricing in many products. Student or demo versions typically are the same as the main product, except for artificial limitations on what they can do. They either cannot produce large executables, or cannot handle large files, or cannot use extended precision. We are likely to see many more examples of such differential pricing. Electronic publications may offer high-resolution versions at one price, a lower-resolution version at a lower one, and sometimes they might offer a fax-quality version at no charge. There are already interesting experiments going on in book distribution, with authors making some parts of their manuscripts freely available on the Internet, to advertise their work, to update it with lists of current errata, and to make available features that draw on the unique capabilities of the electronic medium. There are also likely to be differentials based on timeliness, as with stock market quotes; old issues might be offered at low or no charge. There might be extra charges for links to cited works or other desirable features. Differences in quality of offered products might be the only way to preserve some of the features of public libraries. In the digital realm, without some artificial barriers, there would be practically no difference between buying and borrowing. Hence the traditional library policy of unrestricted lending is not compatible with ecommerce, and we are likely to see artificial barriers. Databases might be available to library customers but only inside the library, at special terminals, for example. Librarians would then have to become gatekeepers, restricting access to material more than making it freely available. 3.3 Subscription vs. pay-per-view Offering access to a database or a movie channel on a subscription basis is a form a bundling. The alternative is to charge for each movie, or each download of a Web page. There is much discussion of how such "a la carte" shopping might become prevalent. One attraction of programs consisting of small applets that can be downloaded on demand appears to be the perception that this would allow producers to charge according to how frequently the software is used. However, past experience with pay-per-view systems has been discouraging. Except for a few events, such as championship boxing matches, they have not succeeded in attracting much revenue. All the arguments in favor of bundling apply, and suggest that pay-per-view systems will not be common. Furthermore, there are additional arguments, supported by empirical data on consumer behavior, that argue against pay-per-view schemes. Consumers appear to have a strong predilection for reducing risk, even when this predilection results in lower than optimal expected financial payoff. A certain $10 gain is usually preferred to a wager with a 90% chance of winning $15, and a 10% chance of losing $20. People also tend to use small deductibles when purchasing fire or casualty insurance, even when they could easily bear the loss from a larger deductible. (Since few insurance companies operate with an overhead of less than 30%, a larger deductible would almost surely lead to savings in the long run.) Similarly, consumers appear to have a strong preference for subscription services. To a large extent this is probably explainable by general risk aversion. I may prefer to pay a higher price for a word processor now, even if I do not need it much, to have free use of it when I lose my job, and need to send out lots of job applications, but will not be able to afford extra charges. This preference for subscription services is present even among librarians, who are not spending their own money, and with a large number of users of their resources might be expected to have a stable usage pattern. Even so, they have often expressed their unease about paying "a la carte" for access to databases, since they feared they could not predict what this would do to their budgets. It is difficult to quantify the strength of this preference for subscription services, but it exists and is strong. In the 1970s, the Bell System first experimented with charging for local calls. Typically, customers were given a choice of the traditional flat rate option, which might cost $7.50 per month, and allow unlimited local calling, and of a measured rate option, which might cost $5.00 per month, allow for 50 calls at no extra charge, and then cost $0.05 per call. Anyone making fewer than 100 local calls per month would be better off with the measured rate option. However, in the numerous trials that were carried out, typically around 50% of the customers who were making almost no local calls at all, and thus would benefit from measured rate service, still stayed with the more expensive flat rate service. The preference for flat rate pricing for Internet access is another example of this phenomenon. The main conclusion to be drawn from this discussion is that subscription services do offer substantial value to consumers, even if that value may seem to be irrational. As a corollary, they also offer value to producers. People are willing to pay a lot just to be able to occasionally use certain features. Software producers complain about all the heavy users of their products who do not pay for their high usage. However, these producers benefit from the many users who hardly ever use their system. I seldom use Microsoft Word, but when I do use it (typically because somebody sends me a Word document), I do need it, and so am willing to purchase it for just such occasions. Hence we can expect that even if large systems consisting of downloadable applets do become practical, they will be available on a subscription, and not on a per-use basis. 3.4 Site licensing Site licensing, in which a company or a university pays a flat fee to allow everyone in that institution to use some program or access a database, is very common in the computer and online information industries. In some forms, it has been present for a long time in other areas as well. For example, scholarly publishing can be thought of as an example of site licensing. Typically a university will buy a single copy of an esoteric journal, which is then placed in a library, to be consulted by anyone on campus. In software, site licensing has many attractive features. It simplifies the enforcement problem (which is nontrivial, since many corporations report they spend more on policing software use than on the purchase of that software). It also encourages new users to try out a package, and thus stimulates more usage. In addition, though, site licensing has a strong direct economic argument behind it. We can think of site licensing as a variant of bundling. In ordinary bundling, a producer assembles together several goods into a bundle, to smooth out the differences in valuations that individual consumers place on those goods. In site licensing, a producer assembles together a group of consumers to smooth out the differences in valuations that different people place on a single product. As an example, suppose that in a company of 1,000 employees, 900 are totally uninterested in a software package, but 10 feel it is worth paying $10 for it, 10 feel it is worth $20, and so on, up to 10 who feel it is worth $100. If the software manufacturer had to sell copies of the package to individuals, the best price would be either $50 or $60 for a copy, and the revenue in either case would be $3,000. However, if the management of the company has an accurate impression of how much the employees value the product, it should be willing to pay $5,500 for a site license. This would be a much better deal for the producer, even though it would bring in only $5.50 for each person entitled to use the product. Hence we can expect further spread of site licensing. 4. Fairness, legality, and efficiency Economic arguments show that there is value to many of the artificial barriers in commerce. It is value not just to producers of the goods and services, but to society. Moreover, the incentives to create such barriers apply to individuals as well as large corporations. If Alice plays the piano, and Bob performs magic tricks, they might be able to obtain higher income by bundling their services through offering a combined act to nightclubs. The result might be the difference between starvation and relative comfort. In ecommerce, a group of budding poets might collect larger revenues if they sell access to their combined works, instead of working individually. While economics will lead to the creation of barriers in ecommerce, this will frequently clash with popular notions of what is fair. There is already much grumbling about airline pricing and senior citizen discounts. Moreover, many of the grumbles result in laws restricting commerce. Several cities in the United States have passed laws decreeing that women's shirts should not cost more to launder than men's. There is a general perception of what is fair, often codified into laws. Some of it goes back to the ancient notion of a "just price," which is supposed to reflect a modest markup over the producer's costs. However, in ecommerce, even more than in the modern physical economy, cost is a poorly defined concept. In ecommerce, the concepts of "increasing returns" [Arthur], in which producer profits increase as usage increases, and customer lock-in, in which someone trained in using a particular spreadsheet faces a major barrier of retraining in switching to another one, are the ruling ones. This means that the standard tests of illegal monopolistic behavior do not apply. It can make excellent sense to give away a software package, since the major benefit to the producer will come from sales of upgrades. Other examples of economically sensible behavior that is not accepted by society exist. U. S. courts stopped IBM from requiring users of its tabulating machines to purchase their punched cards from IBM [US1936]. Today, most economists would argue that this decision was a mistake, since in effect what IBM was attempting to do was to charge the heavy users more than the light ones, to enlarge the market. (See [Stigler] for economic arguments against another decision, [US1962], which barred movie distributors from requiring movie theaters to book whole series of movies instead of selecting them individually.) While the general issue of what practices are legal is not entirely clear (cf. [Bowman, Varian2]), there may be legal problems with some of the barriers that are likely to be erected. Even when there is no legal difficulty, there can be extensive public action, as in recent protests against pharmaceutical firms' pricing, and against use of child labor in less developed countries. (With reputations, whether of celebrity endorsers or producers themselves, becoming increasingly important, public protests can be powerful weapons.) Issues of fairness (see [Zajac] for extensive discussions of their influence on public policy) are likely to be much more pronounced than in the past. One reason is that the barriers on the electronic superhighway are likely to be frequent. Another is that those barriers will be much more visible as artificial. (In print book publishing, most people seem to think that hardcover books sell for more than paperbacks because they cost more to produce. However, the differences in costs are minor, and the price difference is just a form of price discrimination. On the Web, it will be clear that a low resolution version of a work is just a degraded version of the high resolution one.) It will also be much easier to organize protest movements than in the past. Public perceptions of what is fair depend on culture, are often inconsistent, and do often clash with economic incentives. Furthermore, the rapid evolution of technology, markets, and laws, will lead to a continuation of the unstable situation we have. Therefore there will likely be increasing temptation to ask governments to intervene, and that will produce serious difficulties for ecommerce. Barlow's "independence declaration" [Barlow] might appeal to many, but is totally unrealistic. Government has been involved in setting up the Internet, and is getting more involved all the time, through issues such as the fair use of Scientology documents on the Net, assignments of names, and provision of wide access to the Net. The U. S. Telecommunications Act of 1996, which nominally deregulated telecommunications, also brought in extremely intrusive government regulations, to deal with thorny issues of setting up a "level playing field." We should be prepared for more intervention of this type, whether they are successful or not. Many issues will be complex. As an example, only a tiny fraction of the public understood any of the arguments about the U. S. telecommunications deregulation debate, with its technical points about access to local wires. Also, few people follow the details of the debate about revisions to copyright laws. As was argued in an earlier section, ecommerce requires some revision. However, there are a variety of ways to do this, and the precise ways in which different proposals affect different players is not clear to the public. (See the discussions by Samuelson [Samuelson1, Samuelson2] of the proposed revisions to U. S. copyright law [USPTO1995], as well as the survey paper [Okerson] and the book [PattersonL].) Therefore we can expect an increased demand for lobbyists, lawyers, and public relations experts. Even in the non-governmental arena, it is reported, for example, that "in preparing a commemorative CD-ROM for the 500th anniversary of the first Columbus voyage to America, IBM spent over $1M clearing rights, of which only about $10K went to the rights holders; everything else went into administrative and legal fees" [Lesk]. Although systems are being developed for automatic tracking of rights to copyrighted material and the automatic payment of fees, it is unlikely that such systems will see wide usage. Content owners will probably be reluctant to rely on them, and possibly let valuable rights slip away. The conclusion to be drawn from this essay is that electronic commerce will increase the efficiency of the economy. However, it will also create artificial barriers, and we will have to learn to live with them. Acknowledgements: I thank Greg Blonger, Hsueh-Ling Huynh, Bill Infosino, Steve Lanning, Peter Linhart, Gerry Ramage, Ryan Siders, Hal Varian, and Ed Zajac for their comments and the information they provided. References: [AdamsY] W. J. Adams and J. L. Yellen, Commodity bundling and the burden of monopoly, Quart. J. Economics, 90 (1976), 475-498. [Arthur] W. B. Arthur, "Increasing Returns and Path Dependence in the Economy," U. Michigan Press, 1994. [Barlow] J. P. Barlow, A cyberspace independence declaration, Feb. 9, 1996 email broadcast message, available at URL http://syninfo.com/IAN/02136002.htm and many other Net sites. [Bowman] W. S. Bowman, Jr., Tying arrangements and the leverage problem, Yale Law J., 67 (Nov. 1967), 19-36. [Burnstein] M. L. Burnstein, The economics of tie-in sales, Rev. Economics and Statistics, 42 (1960), 68-73. [CookL] K. S. Cook and M. Levi, eds., "The Limits of Rationality," Univ. Chicago Press, 1990. [DeneckereM] R. J. Deneckere and R. P. McAfee, Damaged goods, J. Economics and Management Strategy, to appear. [Dyson] E. Dyson, Intellectual value, first published in Dec. 1994 in Release 1.0, republished (in an abbreviated form) in Wired, July 1995, and available at URL http://www.hotwired.com/wired/3.07/features/dyson.html [Economides1] N. Economides, Mixed bundling in duopoly, working paper (1993), available at URL http://edgar.stern.nyu.edu/networks/cvnoref.html [Economides2] N. Economides, The economics of networks, Intern. J. Industrial Organization, to appear. Available at URL http://edgar.stern.nyu.edu/networks/cvnoref.html [FrankC] R. H. Frank and P. J. Cook, "The Winner-Take-All Society," Free Press, 1995. [Gates] B. Gates (with N. Myhrvold and P. Rinearson), "The Road Ahead," Viking, 1995. [HagelR] J. H. Hagel and A. E. Roth, eds., " The Handbook of Experimental Economics," Princeton Univ. Press, 1995. [KrishnaKA] A. Krishna, P. K. Kopalle, and J. L. Assuncao, Bundling of complementary goods: The impact of competition, brand preference, and price sensitivity, in preparation. [Lesk] M. Lesk, The seven ages of information retrieval, to be published. [Odlyzko] A. M. Odlyzko, On the road to electronic publishing, Euromath Bulletin, vol. 2, no. 1 (June 1996), to appear, and to be available at URL http://www.math.ethz.ch/~shared/emb Available electronically at URL http://netlib.att.com/netlib/att/math/odlyzko/index.html and via email by sending the message send epublishing.road.txt from att/math/odlyzko to netlib(a)research.att.com. [Okerson] A. S. Okerson, Who owns digital works?, Scientific American, 275 (July 1996), 64-68. Text available electronically at URL http://www.sciam.com/WEB/0796issue/0796okerson.html [PattersonL] L. R. Patterson and S. W. Lindberg, "The Nature of Copyright: A Law of Users' Rights," Univ. Georgia Press, 1991. [RichardsonR] T. J. Richardson and R. Radner, Monopolists and viscous demand, to be published. [Samuelson1] P. Samuelson, Intellectual property rights and the global information economy, Comm. ACM 39 (1996), 23-28. [Samuelson2] P. Samuelson, Technological protection for copyrighted works, Emory Law J., to appear. [Schmalensee] R. Schmalensee, Pricing of product bundles, J. Business, 57 (1982), S211-S230. Comments on pp. S231-S246. [Stigler] G. Stigler, United States v. Loew's Inc.: A note on block booking, Supreme Court Review, 152 (1963), 152-157. [US1936] International Business Machines Corp. v. United States, 298 U.S. 131 (1936). [US1962] Loew's Inc. v. United States, 371 U.S. 38, 52 (1962). [USPTO1995] Intellectual Property and the National Information Infrastructure, The Report of the Working Group on Intellectual Property Rights, B. A. Lehman, Chair, U. S. Patent and Trademark Office, Sept. 1995. Available at URL http://www.uspto.gov/web/ipnii/ [Varian1] H. R. Varian, A model of sales, Am. Economic Review, 70 (1980), 651-659. Erratum on p. 517 of vol. 71 (1981). [Varian2] H. R. Varian, Price discrimination, pp. 597-654 in "Handbook of Industrial Organization," vol. I, R. Schmalensee and R. D. Willing, eds., Elsevier, 1989. [Varian3] H. R. Varian, Pricing information goods, available at URL http://www.sims.berkeley.edu/~hal/people/hal/papers.html. [Varian4] H. R. Varian, Buying, renting and sharing information goods, available at URL http://www.sims.berkeley.edu/~hal/people/hal/papers.html. [Wilson1] R. Wilson, "Nonlinear Pricing," Oxford Univ. Press, 1993. [Wilson2] R. Wilson, Nonlinear pricing and mechanism design, pp. 249-289 in "Handbook of Computational Economics," vol. I, H. M. Amman, D. A. Kendrick, and J. Rust, eds., Elsevier, 1996. [Zajac] E. E. Zajac, "Political Economy of Fairness," MIT Press, 1995.

1 0

Re: Unmetered Net Usage
by jya＠pipeline.com 17 Dec '03

17 Dec '03

Science, August 2, reports on Net traffic jams and various schemes to ease the flow, including pricing correlated to speedier service. See: http://www.sciencemag.org/science/scripts/display/full/273/5275/585b.html The report is part of a special section on computer use in science, with three others on the Internet. For the full section see: http://www.sciencemag.org/science/scripts/display/full/273/5275/585.htm

1 0

[NOISE] Re: Police prepare stunning e
by Peter Trei 17 Dec '03

17 Dec '03

pjn(a)nworks.com writes: Someone writes: >> The car stopper works by focusing an intense electromagnetic >> charge on the electronic systems that manage most modern >> engines, disabling them and paralysing the car. In the jargon >> of its inventors, the 150 kilovolt charge is a nemp, or non-nuclear >> electromagnetic pulse. Contractors are bidding to produce a >> police version. > Is there any dif between this and a HERF gun? Only that this is pretty real, while "HERF guns" have only appeared in science fiction novels, and in newspaper articles which seem to be from the 'Weekly World News' school of journalism. Go over the the amateur radio newsgroups, and you'll find that the interference of mobile ham radios with car ignitions is a well known issue. On a more speculative note, many years ago Harlan Ellison wrote an anti-statist short story entitled '"Repent Harlequin!" cried the Tick-Tock Man.' , in which the government required all adults to be surgically fitted with 'cardioplates', which allowed the state to turn off the hearts of uncooperative citizen-units by radio. Peter Trei trei(a)process.com

1 0

List of reliable remailers
by Raph Levien 17 Dec '03

17 Dec '03

I operate a remailer pinging service which collects detailed information about remailer features and reliability. To use it, just finger remailer-list(a)kiwi.cs.berkeley.edu There is also a Web version of the same information, plus lots of interesting links to remailer-related resources, at: http://www.cs.berkeley.edu/~raph/remailer-list.html This information is used by premail, a remailer chaining and PGP encrypting client for outgoing mail. For more information, see: http://www.c2.org/~raph/premail.html For the PGP public keys of the remailers, finger pgpkeys(a)kiwi.cs.berkeley.edu This is the current info: REMAILER LIST This is an automatically generated listing of remailers. The first part of the listing shows the remailers along with configuration options and special features for each of the remailers. The second part shows the 12-day history, and average latency and uptime for each remailer. You can also get this list by fingering remailer-list(a)kiwi.cs.berkeley.edu. $remailer{"extropia"} = "<remail(a)miron.vip.best.com> cpunk pgp special"; $remailer{"c2"} = "<remail(a)c2.org> eric pgp hash reord"; $remailer{"penet"} = "<anon(a)anon.penet.fi> penet post"; $remailer{"flame"} = "<remailer(a)flame.alias.net> cpunk mix pgp. hash latent cut post reord"; $remailer{"mix"} = "<mixmaster(a)remail.obscura.com> cpunk mix pgp hash latent cut ek ksub reord ?"; $remailer{"replay"} = "<remailer(a)replay.com> cpunk mix pgp hash latent cut post ek"; $remailer{"ecafe"} = "<cpunk(a)remail.ecafe.org> cpunk mix"; $remailer{"amnesia"} = "<amnesia(a)chardos.connix.com> cpunk mix pgp hash latent cut ksub"; $remailer{'alpha'} = '<alias(a)alpha.c2.org> alpha pgp'; $remailer{'nymrod'} = '<nymrod(a)nym.jpunix.com> alpha pgp'; $remailer{"lead"} = "<mix(a)zifi.genetics.utah.edu> cpunk pgp hash latent cut ek"; $remailer{"nemesis"} = "<remailer(a)meaning.com> cpunk pgp hash latent cut"; $remailer{"exon"} = "<remailer(a)remailer.nl.com> cpunk pgp hash latent cut ek"; $remailer{"vegas"} = "<remailer(a)vegas.gateway.com> cpunk pgp hash latent cut"; $remailer{"haystack"} = "<haystack(a)holy.cow.net> cpunk mix pgp hash latent cut ek"; $remailer{"ncognito"} = "<ncognito(a)rigel.cyberpass.net> mix cpunk pgp hash latent"; $remailer{"lucifer"} = "<lucifer(a)dhp.com> cpunk mix pgp hash latent cut ek"; $remailer{"jam"} = "<remailer(a)cypherpunks.ca> cpunk mix pgp hash latent cut ek"; $remailer{"winsock"} = "<winsock(a)c2.org> cpunk pgp hash cut ksub reord"; $remailer{'nym'} = '<config(a)nym.alias.net> newnym pgp'; $remailer{"balls"} = "<remailer(a)huge.cajones.com> cpunk pgp hash latent cut ek"; catalyst(a)netcom.com is _not_ a remailer. lmccarth(a)ducie.cs.umass.edu is _not_ a remailer. usura(a)replay.com is _not_ a remailer. Groups of remailers sharing a machine or operator: (c2 alpha) (flame replay) (alumni portal) Use "premail -getkeys pgpkeys(a)kiwi.cs.berkeley.edu" to get PGP keys for the remailers. Fingering this address works too. Note: The remailer list now includes information for the alpha nymserver. Last update: Mon 12 Aug 96 6:48:36 PDT remailer email address history latency uptime ----------------------------------------------------------------------- mix mixmaster(a)remail.obscura.com -++--++-+--+ 2:22:53 99.96% haystack haystack(a)holy.cow.net *+*#*+*--### 21:59 99.95% balls remailer(a)huge.cajones.com *++# 6:01 99.95% lead mix(a)zifi.genetics.utah.edu ++++++++--++ 1:59:31 99.94% replay remailer(a)replay.com *** **+***+* 5:07 99.91% nymrod nymrod(a)nym.jpunix.com #+** *####-# 23:23 99.90% penet anon(a)anon.penet.fi ------_.-- 14:43:28 99.55% jam remailer(a)cypherpunks.ca **** _.-**** 6:31:35 98.67% nemesis remailer(a)meaning.com **+ * **** 28:31 98.61% winsock winsock(a)c2.org ----..--_ - 18:19:17 97.80% amnesia amnesia(a)chardos.connix.com --- ------ 3:20:56 96.89% extropia remail(a)miron.vip.best.com __ ------ 10:03:23 91.52% ncognito ncognito(a)rigel.cyberpass.net -....----+ 7:57:35 89.83% alpha alias(a)alpha.c2.org +-+*+-_. 5:24:22 58.18% c2 remail(a)c2.org --+---.. 5:59:32 57.68% lucifer lucifer(a)dhp.com +--+++++ 53:57 56.99% History key * # response in less than 5 minutes. * * response in less than 1 hour. * + response in less than 4 hours. * - response in less than 24 hours. * . response in more than 1 day. * _ response came back too late (more than 2 days). cpunk A major class of remailers. Supports Request-Remailing-To: field. eric A variant of the cpunk style. Uses Anon-Send-To: instead. penet The third class of remailers (at least for right now). Uses X-Anon-To: in the header. pgp Remailer supports encryption with PGP. A period after the keyword means that the short name, rather than the full email address, should be used as the encryption key ID. hash Supports ## pasting, so anything can be put into the headers of outgoing messages. ksub Remailer always kills subject header, even in non-pgp mode. nsub Remailer always preserves subject header, even in pgp mode. latent Supports Matt Ghio's Latent-Time: option. cut Supports Matt Ghio's Cutmarks: option. post Post to Usenet using Post-To: or Anon-Post-To: header. ek Encrypt responses in reply blocks using Encrypt-Key: header. special Accepts only pgp encrypted messages. mix Can accept messages in Mixmaster format. reord Attempts to foil traffic analysis by reordering messages. Note: I'm relying on the word of the remailer operator here, and haven't verified the reord info myself. mon Remailer has been known to monitor contents of private email. filter Remailer has been known to filter messages based on content. If not listed in conjunction with mon, then only messages destined for public forums are subject to filtering. Raph Levien

1 0

No Subject
by Michael Reusch 17 Dec '03

17 Dec '03

is now doing internet telephony (www.von.com) Who isnt? They have developed a set of voice morphing tools (www.voxware.com/meta.htm) and I quote: Morph-It offers an alternative. Morph-It allows multimedia developers and users to actually change, in real time, the character of encoded speech by altering resonance, pitch, timbre and other voice personality elements. With Morph-It, pitch and resonance can be altered independently. All these changes can be made and saved using a simple editor, and transformed voices can be stored as easy-to-apply VoiceFonts. Morph-It can be used for a variety of purposes: Multiple voice personalities can be created from a single voice recording. Users in "real-time" applications can disguise or alter their voices to enhance game- and role-playing. Vocal character can be easily transformed into virtually any form, whether from male to female, or from a child's to an adult's. End quote. I have not heard it work. Imagine drunken suits, in karioki bars, sounding like drunken Pavarottis, disk jockeys whose true voices are nasel whines, talking-heads and telemarketers using highly tuned voice-clones, home-alone children answering the phone as John Wayne.

1 0

Re: India, Productivity, and Tropical Climes
by Peter Trei 17 Dec '03

17 Dec '03

Tim writes: >Arun Mehta writes: > [huge snip] > >My prediction is that with the blessings of the Internet, the > >next generation of multiracial programmers, even those that were > >born in the USA, will be more likely to be found on the beaches > >of tropical islands than in the fog of San Francisco. When you > >can work in the shade of a palm tree, even if you should earn > >less, it's worth it :-) > As attractive as this sounds, historically this has not happened. And as > many will tell you, the climate of the Bay Area in particular and > California in general is extremely benign and delightful. The average > winter temperature is only about 10C cooler than summer temperatures. > Evenings are not balmy, but neither are they oppressively hot. 'Oppressive' is a subjective term, and is largely defined by what one is used to. Personally, I find the Bay area's climate very boring, too dry, and usually too hot (and yes, I've been there many times, at all parts of the year - I'm speaking from experience). Due to the lack of rain, the whole country side also seems much dirtier than a place where everything, both natural and artificial, gets a regular washing. > Interestingly, and not really related to CP themes, the fact is that is > that most technological developments have come out of cooler climes. Not a > lot of stuff from tropical and island climes. Maybe they realize life is > too good eating roast pig at the beach luau, maybe they are too lethargic > from the heat, maybe tropical diseases and mosquitos have taken their toll, > maybe.... The last time I heard this argument was in a documentary film about South African mining and agriculture, produced by South Africans, during the height of apartheid 'these great natuaral resources lay untapped until the arrival of a more industrious people, tempered by a colder climate...' While there *is* some truth that people living in environments where survival does not depend on long-term planning have less pressure to develop sophisticated industry, to claim that average temperature is the main determinate is betrays an ignorance of history. The technological pre-emminence of Northern Europe and derivative cultures is a very recent phenomenom. Civilization was invented in hot climates, and for most of history the more sophisticated cultures were in locations where you could sweat any time of the year - the Mediterranean basin, Mesopotamia, India, coastal China, Central America - in fact, in the classical period you could have mapped out a 'civilized belt' surrounding the globe in a distinctly sub-tropical climate. > I know an awful lot of folks who could easily affort to move to almost > anywhere in the world, and yet they stay in California. (I also know folks > moving to even cooler climes, in the U.S., especially less-crowded areas.) In any place you can name, most of the people who can afford to move to other areas do not do so. By your argument, Kuwait should be totally depopulated by now. > --Tim May Peter Trei trei(a)process.com Peter Trei Senior Software Engineer Purveyor Development Team Process Software Corporation http://www.process.com trei(a)process.com

1 0

Re: Rumors of death of Anguilla Data are greatly exagerated.
by an584514＠anon.penet.fi 17 Dec '03

17 Dec '03

Vince says: > And Anguilla is first and foremost a taxhaven. But it tries hard to be a > very clean taxhaven (does not want drug money etc). I think that "clean" > corporations operating here tax free is a potentially huge market. This is an illusion. There ain't no such thing as a clean corporation operating in a clean tax haven. Every overseas corp that is doing something they can't do without interference back onshore, is running the gauntlet. Remember, its my moral choice as to whether its dirty, and if I am sitting in some Washington quango office, and I decide its dirty, then it is. Plus its my job to fight it, and I'm not afraid of a dirty fight. And I got a list of contacts who've got friends who've got favours to call in... But you must know this, don't you follow the machinations that USG pulls in the region to try and close down the arbitrages? > Anguilla and OIS are not the data haven of cypherpunks wet dreams. Neither > Anguilla nor I want "hit men for hire" advertising here. Sorry Tim. And I > think the loss in clean business would outweigh any money from such by a > long shot. Nobody's talking about things that every body agrees are no-go. Shooting people is generally considered not acceptable. So please don't change the subject. What we are talking about is a fairly harmless concept. An obviously "fake" passport that is designed to fool the supposedly ignorant peasant terrorist when they wave grenades on the some flight from Miami, now going to Havana. It's a laughable concept, and one that most western governments have sniffed at and not lifted one finger to even warn about. OK, so there is a chance that a dumb clerk in a bank could be fooled. Still, opening a bank account with such a person could be done any number of ways. It's equally possible to imagine the Honduras passport being used to escape some sudaka warzone, without being shot for a gringo. Remember PGP? It was used for liberty, crime and freedom, all at once. > One simple example is that OIS was given a project Gutenberg CD-ROM and > may sell online copies of old books. Some countries are extending > copyrights back further into the past. Anguilla is not. So we could sell > books that have expired copyrights in Anguilla but not expired in USA etc. > Think regulatory arbitrage. Crap. It's obvious what book your talking about, if you get Europeans down there. It's about as harmless, or harmful, as "kill the Queen" rants, again its my moral choice. If a phone call from your lawyer causes such good responses, then there is no problem about getting this one made out-of-stock. Do you have a lot of tourists then from *that* place? What's the GDP take for the holiday trade anyway? > Taxhavens are a huge and well understood market. Datahavens are still > new. Not counting gambling, they may only be $0/year rounded to the > nearest million. The distinction is irrelevant. What are you going to do to protect my business? Now I know. SFA. I may be asking you for data protection, but my profits, which (might) pay you, come from a long line of other businesses. We're not all geeks. Tim makes good points, especially as he is not (as far as I can see) in the trade. When my company does business with such a jurisdiction, we look for the list of things allowed and the list of no-nos (which we respect). Then we look at the history of how that country stand up to its word. One thing is what they say, then another is what they do. It's surprising how easy it is to see just how much a place really wants your business for the long run. I will say this, it ain't really your fault that this happened. The webshop was too bright, too blatent. He talked to toublesome scam reporters. That sort of thing is going to bring in trouble. Softly softly catchee monkey is what is needed. Then when the phone rang my guess is it all happened to quickly. You win some you lose some. Lets not make a bad story get worse. Even though this is not a happy post (Anguilla was on our list) we still would like you to suceed. Our advice, worth what you paid, is don't advertise this event, one bad storm doesnt sink a ship. Take a look at all your webpages and tone down the noisy ones. Tell them to camoflage their location, no pun intended. Then, get down to your lawyers office and sit down over a beer and work out how your going to handle this thing next time. Properly. Publish (quietly but definatively) your list of no-nos (ok, that's already said). Think about what new shops want to do and talk it over with your man down at the bar (so you can predict the attacks). Learn some negotiating skills, soften the blow from both ends. Nothing I'm sure you hadn't thought of. Cheers, sorry for anonymity, but as I say, its softly softly in this game. Wish you luck. --****ATTENTION****--****ATTENTION****--****ATTENTION****--***ATTENTION*** Your e-mail reply to this message WILL be *automatically* ANONYMIZED. Please, report inappropriate use to abuse(a)anon.penet.fi For information (incl. non-anon reply) write to help(a)anon.penet.fi If you have any problems, address them to admin(a)anon.penet.fi

3 2

Re: Fun with M$
by Dan Siemon 17 Dec '03

17 Dec '03

---------- > From: Rich Graves <llurch(a)networking.stanford.edu> > To: cypherpunks(a)toad.com > Subject: Re: Fun with M$ > Date: Friday, August 09, 1996 8:46 PM > > On Fri, 9 Aug 1996, Jeremey Barrett wrote: > > > Information page with a link to a page which loads the control: > > > > http://www.halcyon.com/mclain/ActiveX/ > > > > Quote from the page: > > > > Exploder is an Active X control which demonstrates security problems with > > Microsoft's Internet Explorer. Exploder performs a clean shutdown of > > Win95 and will turn off the power on machines that have a power > > conservation BIOS (green machines). I don't see how anyone can call this a bug. Microsoft has chosen what Sun should have: leave the security to the user, don't take it away from everyone. Java has been sverly crippled by the removal of features that would have made applets truly usefull, like local disk access. By leaving these abilities and allowing the user to choose whether or not to run the object, leaves the trusted objects to be truly usefull. Microsoft has even designed a system of trust verification for these objects throught the trust chain and the MS download service. For details on the MS download service look at the july 96 issue of Microsoft Systems Journal. Security should be a user/parent decision not a general ban to protect a few.

2 1

Re: Read; NOW
by Erle Greer 17 Dec '03

17 Dec '03

At 10:29 PM 8/11/96 -0400, Unix_Code <unix_code(a)geocities.com> wrote: > Hi I'm Unix Code and have a few things to ask... Ok, go ahead... we're waiting... I thought you had a few things to ask? > (it may not go with >Cryptography but go ahead and read) Maybe I read it too fast. Not only did it have nothing to do with crypto, but I could not ascertain as to it's relevance to anything whatsoever. - I'm sorry, C-Punks; I couldn't resist, but I did keep it short. Vagab0nd<br> <a href="http://ww2.sd.cybernex.net/~vagab0nd/index.html">Visit web page for public key.</a>

1 0

[NOISE] Re: Police prepare stunning e CUT_ags
by jya＠pipeline.com 17 Dec '03

17 Dec '03

Peter Trei <trei(a)process.com> Wrote: On a more speculative note, many years ago Harlan Ellison wrote an anti-statist short story entitled '"Repent Harlequin!" cried the Tick-Tock Man.' , in which the government required all adults to be surgically fitted with 'cardioplates', which allowed the state to turn off the hearts of uncooperative citizen-units by radio. -------- NYP reports today on the thriving market for Radio Frequency Identification (R.F.-ID) tags. And FiTi reports today on tagging cattle, tracking meat from cradle to abbatoir, to ward off mad cow assassination politics. Are these precursors of CU body-tags acoming from ARPA labs? E-Systems and a bunch of comp-conspirators just got supercalifrigalistic HPCC contracts. ----- For the NYT and FiTi reports, see: http://jya.com/cutags.txt CUT_ags

1 0

Re: FCC_ups
by jfricker＠vertexgroup.com 17 Dec '03

17 Dec '03

At 08:58 PM 8/11/96 -0700, you wrote: >At 14:08 8/11/96, John Young wrote: >> 8-10-96. WaPo: >> >> "Phone Service Via the Internet May Slash Rates." >> >> Labs of Advanced Technology has developed a way for >> people to make long-distance calls over the Internet >> using only their telephones, at about half the price of >> ordinary toll calls. Customers would merely call a >> central number, then dial their long-distance numbers. >> The call is carried on the Internet, then put back onto >> the local phone system at its destination. The company >> plans to charge 5 to 8 cents per minute for all domestic >> U.S. calls, which represents a 50 to 75 percent discount >> off most domestic long-distance rates. > >I am glad to see some movement in this area. I designed a similar system >for a previous employer of mine. But the real choke point is the local >loop. As of this day, the local telos still have a de facto monopoly in the >local markets. The new competitors (the same old Phone Company) that we >will see in the near future seem to show no desire to deliver the really The real issue concerns the $0.03 per minute access fee that LD companies pay the local loop for voice communications. Seems there is difference between data bits and voice bits. VON has sparked this debate and the ISP's may end up paying the RBOCs the access fee. The way around that as well is through point to point wiring (and of course wireless systems). PairGain Technology is manufacturing a product that provides 384Kbps data and voice over a single pair of copper. Many RBOCs will sell you a LAD circuit which is point-to-point, unloaded, and unswitched. They go by different names : telegraph circuits, alarm circuits, Local Area Data Circuit. Ask a security company what kind of circuit they install. Your mileage may vary. --j

1 0

Re: US Power Outages
by jim bell 17 Dec '03

17 Dec '03

At 07:28 AM 8/12/96 -0500, Igor Chudov @ home wrote: >Jim McCoy wrote: >> Even the power company's secret experiments in the cores of nuclear reactors >> have not found a way to get around the 186,000 km/s speed limit on everything. >> > >I wonder where does the 186,000 km/s speed limit come from? ;) > A serious confusion as to proper units. Jim Bell jimbell(a)pacifier.com

1 0

New mixmaster/ghio remailer mix@squirrel.owl.de
by Johannes Kroeger 17 Dec '03

17 Dec '03

-----BEGIN PGP SIGNED MESSAGE----- I've installed a Mixmaster/Ghio remailer combination on my Linux machine with the address mix(a)squirrel.owl.de. Here are the public keys: Type Bits/KeyID Date User ID pub 1024/0B11B275 1996/08/08 Squirrel Remailer <mix(a)squirrel.owl.de> -----BEGIN PGP PUBLIC KEY BLOCK----- Version: 2.6.3ia mQCNAjIJ8IkAAAEEAJvmQTdUL2iLpKmZcnrtQuQWdw1zqt7oYVqkWeFa8J0qrunP smKvfTXmo52y2leLxbKZ6efADvrKq9ThXGF6qREVIdzTOnRYsVIwSSJjqBiDykAU cz8y/rEDes0oty4TRhysve976RwF3dLK7WU0RrDFj3VBLMhzyiQ+wVoLEbJ1AAUR tCdTcXVpcnJlbCBSZW1haWxlciA8bWl4QHNxdWlycmVsLm93bC5kZT6JARUCBRAy DQ4gvA9InihC/mkBAUlnCACgdpUBabYF9mQPaBC69YGxvcmoYQUxtqj7HlSpAAMr l0HlPNVUHuSqgo3Wo54uIHc4fFA2JYyxi/qETrQU5sHGOHq63H66uPylyzTLfE5v uIzbMuikNL2f9SIpdPamW2b+4Jep8UNlSGN0hKtbyedBDClJfPYbCXn9FKgwFcoo UyPTcfiAsV1f97cTGFM88thUVv6pAYNO4quangxnBEtdwY/mrr1xefw36TiC1yPo PNItxHEFRFxD2aEG5vA5hjRp/Sz5ZXZiY8K9X7hlt+n3MUXfKKz/OldWtF+Q9fOg a8Kmqj+duqlS2A4NbWp9emujOEzn2giI7+13B8MEyzVliQCVAgUQMgnwiSQ+wVoL EbJ1AQFKYwP/XqOGRvvjyd3anh42iAG0SASP9e/fIjD8bCymdEhJHdAsNy0H06ns oaLtH20tHN4BAgUo9i9H8h11+AygF4iJokGz1coP2BJI/O2o7YxR8SBWwk1SSrCb utbsi00uz/7QN1zb7Gn/sowUahhBsmhbJbkuur6EB5shBqyq0m/5jVE= =MqM9 -----END PGP PUBLIC KEY BLOCK----- =-=-=-=-=-=-=-=-=-=-=-= squirrel mix(a)squirrel.owl.de 072821bee96df27f9defd3b41d216ac2 2.0.3 -----Begin Mix Key----- 072821bee96df27f9defd3b41d216ac2 258 AASyQ7WwBpuGeDdEHnfEZO3WXHbGWbtyz0EKeImP moWsMhfky9H/GoFt3qH10HsH2Hf5TbZBQFim7P2F cgvKNiitUwihSyZcTQEDPbhEIWMQCZdBZLDO8zId eAg3TUhwhHfjdILNyhMTOMyqZQckY+mrUTboT/z3 nloJJdC4PSHPiwAAAAAAAAAAAAAAAAAAAAAAAAAA AAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA AAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA AAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA AAAAAAAAAAAAAAAAAAAAAQAB -----End Mix Key----- The Ghio remailer has the following features: $remailer{"squirrel"} = "<mix(a)squirrel.owl.de> cpunk mix pgp hash latent cut ek" My connection for email is via a UUCP link that is polled every two hours. Do not expect quick turnaround of remailed messages. List pingers please note. This can be a disadvantage or an advantage depending on your needs and expectations. Please read the help file before using the remailer. You can get it by sending an empty mail with subject "remailer-help" to mix(a)squirrel.owl.de. I adapted and extended the original remailer help files and inserted a section about reply blocks and pseudonyms. C'punks, please mail questions and comments directly to me, as I'm not subscribed to the cypherpunks list. -----BEGIN PGP SIGNATURE----- Version: 2.6.3ia Charset: latin1 Comment: Processed by Mailcrypt 3.4, an Emacs/PGP interface iQEVAgUBMg9WB7wPSJ4oQv5pAQFoTgf+NABhSyEDQyzLoAC/FVDSvhSJtdbaXMFz vQOxVpUk9DllNpDIkW8Wj/rdH7QDk2vma8bNAaBD3/7HOs8ygFLWlLC3ZB48TpTK ghd/JT8VTvnHHQ3uM3XyXEwLkykTyJJhDuDBbnVzczCwEGQaaz/cpdQInVzQIOc7 GTNyRGGJX4ILzHNH5hfxZTDMfgCjF1qpvSqgT1qibhbViCH05zT4yykKcl83KE4v M8bFGrw86CUrLoUww5xTmiRIvHbUFCtwwrvjAktAX1U6jUyrJjn8qsyPj8lvA9eB qaRD1PwjJg57QYAkrHl0H11owpUZDPW7y76mBKYzQofPBCIuAkuW6g== =zgfG -----END PGP SIGNATURE----- -- Johannes Kroeger <jkroeger(a)squirrel.owl.de> Send me mail with subject "send pgp-key" to get my PGP key

1 0

don't say "bomb" on the internet
by I=(!isnum(self)) 17 Dec '03

17 Dec '03

Below is from EFF source. Does anyone have specifics on where this piece of idiocy is supposedly going from here? When does Congress reconvene on this issue? Any specific activities going on regarding this piece of crap? [begin quote]======================================================================== This is the language that Feinstein inserted into the Defense Authorization Act. It has been passed by the Senate. This is not good, but significantly different from her first effort last Spring (a similar amendment, to the S.735 anti-terrorism bill of 1995). This language is technology-neutral. However, it does have a very slippery 'intent' or 'knowledge' standard, and though the language of the bill does not directly focus on the Internet, all of Feinstein's commentary on the Senate floor and to the press have focused exclusively on "bomb-making information" on the Internet. Though this new version of her Net censorship proposal is possibly constitutional, unlike the earlier one, a key question that all constituents and journalists need to ask of Sen. Feinstein is: If you are simply trying to criminalize online incitement of, or conspiracy to commit, murder by bomb, then what on earth does this bill do? Both of these things are *already illegal* online or offline. S.1762 Department of Defense Authorization Act for Fiscal Year 1997 (Passed by the Senate) SEC. 1088. PROHIBITION ON THE DISTRIBUTION OF INFORMATION RELATING TO EXPLOSIVE MATERIALS FOR A CRIMINAL PURPOSE. (a) UNLAWFUL CONDUCT- Section 842 of title 18, United States Code, is amended by adding at the end the following new subsection: `(l) It shall be unlawful for any person to teach or demonstrate the making of explosive materials, or to distribute by any means information pertaining to, in whole or in part, the manufacture of explosive materials, if the person intends or knows, that such explosive materials or information will be used for, or in furtherance of, an activity that constitutes a Federal criminal offense or a criminal purpose affecting interstate commerce.'. (b) PENALTY- Section 844(a) of title 18, United States Code, is amended-- (1) by striking `(a) Any person' and inserting `(a)(1) Any person'; and (2) by adding at the end the following: `(2) Any person who violates subsection (l) of section 842 of this chapter shall be fined under this title, imprisoned not more than 20 years, or both.'.

1 0

Re: US Power Outages
by jim bell 17 Dec '03

17 Dec '03

At 11:02 PM 8/11/96 -0700, Bill Stewart wrote: >At 06:15 PM 8/11/96 -0400, Dave Farber wrote: >>attempt to explain that blackout and how to prevent such. We have not >>progressed very far. The avalanche behavior of power systems is still not >>well understood and techniques to prevent such failures are not obvious. > >It surprises me how little these systems appear to be monitored. >It took some hours for them to decide that the brush fire on the >California border didn't cause the system to shut down; >you'd think they'd know quickly that the subsystem shut itself down >or disconnected from the grid or whatever because of reason #17... The story previously being promoted says that approximately at the Oregon/California border, a fire caused problems with the transmission line. This morning, I read the new claim: extreme heat (presumably assisted by heat dissipated in the power line itself) cause the power cables near The Dalles (about 100 miles east of Portland, along the Columbia river) to stretch and sag, eventually shorting themselves out to trees near the ground. I find this claim EXTREMELY hard to believe. The temperature coefficient of expansion of steel is about 10 ppm/degree C, which means that even if the power lines heated up 200 degrees C, that's only 2000 ppm longer, or about 0.2% I don't know the formula to determine the length of a catenary, and I'm too lazy to look it up right now, but I'd imagine that this 0.2% increase in length won't increase the amount of sag by more than a factor of 10 higher, or 2%. That amount should be almost ignorable if the power line was competently installed and maintained. >One of my concerns about the situation is that it's only a week >or two after Clinton's speech about how The Government needs to protect the >National Information Infrastructure for us. I'm not paranoid enough >to think that they did it, but I'm sure that within a week we'll >see Al Gore or somebody making an NII Protection Agency speech >and Louis Freeh explaining that we need enhanced wiretap underwriting >to make sure that encryption-wielding hackers don't do it again. I've long believed that if incidents such as these were the work of saboteurs, it is in the interest of the ordinary citizen that communication with those responsible is maintained. If, on the other hand, the fact of the sabotage is covered up, that will only lead to more. The government, on the other hand, has an illegitimate interest in seeing it hidden (where it can be hidden; and where the government can't see a good reason to publicize it), because if uncovered it would tend to force the government to actually deal with the dissatisfied citizenry: not merely the ones doing the sabotage, but also the ones who have heard what their motivations are and at least partly agree with them. Jim Bell jimbell(a)pacifier.com

1 0