Clips July 1, 2002

[Lillie Coney <lillie.coney@xxxxxxx>]

Clips July 1, 2002

ARTILCES

FTC: Disclose Paid Search Listings
Acquisition councils seek input on applying 508
Arab spelling slows inquiries in terror war
U.S. struggles with outdated databases
In-Q-Tel, Investing In Intrigue
E-learning site to debut next month
'Digital Divide' Less Clear
China Threatens Internet Cafe Owners
A Dispute Over Wireless Networks
Web publishers sue over pop-up ads
Real-life hacker writing unreal account
FBI Computer Upgrades Will Not Be an Easy Fix
Computers reach one billion mark
DOD officials push real-time intelligence
Homeland HR plan criticized
FBI gets records management act together
Senate passes bill to create e-government office

***********************
Associated Press
FTC: Disclose Paid Search Listings
Fri Jun 28, 4:34 PM ET
By D. IAN HOPPER, AP Technology Writer

WASHINGTON (AP) - Internet search engines that take money from Web sites in 
exchange for prominent placement should make that practice clearer to Web 
users, federal regulators said Friday.


Many search engine Web sites, including AltaVista, LookSmart and AOL 
Search, give preferred placement to paid advertisers. The Federal Trade 
Commission said that prime space can confuse Web users who are looking for 
the best response to their search, rather than ads for sites that paid up 
front.

The commission's decision came in response to a complaint from consumer 
advocacy group Commercial Alert, which is backed by activist Ralph Nader ( 
news - web sites).

Gary Ruskin, executive director of Commercial Alert, said his group is 
"defending the advertising-editorial line from the aggressive commercialism 
of corporate advertisers."

"When the search engines show that ads are ads, we're hoping consumers will 
flee these search engines," Ruskin said.

While the FTC said it doesn't plan to file suit against the search engines, 
it will send a letter to each calling for "clearer disclosure of the use of 
paid inclusion, including more conspicuous descriptions of paid inclusion 
itself."

The FTC said it will send the letter to AltaVista, AOL Time Warner, Direct 
Hit Technologies, iWon, LookSmart, Microsoft and Terra Lycos.

Since Internet advertising dollars started becoming scarce two years ago, 
sponsored links have become popular among search engines. But they are not 
always clearly marked.

For example, a search on AltaVista for "wine" will result in four links at 
the top of the results under the heading "Products and Services." In tiny 
letters, without an underline that is customarily used in Web links, is the 
word "info." If a user clicks "info," AltaVista said the links were 
"reviewed by editors" for their relevance. Only later in the disclosure 
does AltaVista admit they are paid advertisements.

All of LookSmart's search results are paid links, ranked by how much the 
company paid for the listing. But nowhere on the page is there a clear 
disclosure that the links were purchased.

An AltaVista spokeswoman said they have not yet received the FTC letter, 
and declined to comment on the disclosure of paid links. Neither LookSmart 
nor Microsoft immediately returned calls seeking comment.

AOL spokesman Andrew Weinstein said AOL and Netscape, an AOL property, have 
adopted the term "Sponsored Link" to flag paid ads in search results. 
Weinstein said the company changed its policy after the complaint. The same 
language is used by search engine Google ( news - external web site), which 
Ruskin praised in his FTC complaint.

A recent survey by Consumers Union found 60 percent of Internet users 
polled had no idea that certain search engines were paid fees to list some 
sites more prominently than others.

The FTC said search engine companies should clearly distinguish between 
paid and non-paid results. Regulators said there is no determination the 
search engines broke the law, and it plans no other action.
**********************
Government Computer News
Acquisition councils seek input on applying 508
By Jason Miller

The Civilian Agency Acquisition Council and the Defense Acquisition 
Regulatory Council are asking agencies and vendors for comments on how to 
be more consistent in implementing the accessibility features mandated by 
Section 508 of the Rehabilitation Act Amendments of 1998.

The councils yesterday published in the Federal Register an advance notice 
of their proposed rule-making. Comments are due by Aug. 26.

When Section 508 took effect a year ago, the councils amended the Federal 
Acquisition Regulation to incorporate usability standards developed by the 
Access Board. They did not, however, require vendors to certify that their 
products meet the standards. Some officials suggest that a clause in the 
FAR that better details the requirements of 508 would supply more specific 
guidance.

The councils have asked agencies and vendors to comment on:

The need for more guidance and the advantages and disadvantages of an 
acquisition clause
Whether the guidance should be a FAR rule, a solicitation provision or a 
nonregulatory instruction
The content of the guidance.

To see a copy of the notice, visit 
frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=2002_register&docid=02-15976-filed.
*************************
San Francisco Chronicle
Security analysts dismiss fears of terrorist hackers
Electricity, water systems hard to damage online

Despite growing government concern that al Qaeda and its allies may try to 
use computers to disrupt electrical power grids, transportation systems and 
emergency communication networks, many experts on terrorism and computer 
security are skeptical about the overall menace of cyber-terrorism.

"The notion that somebody armed with a laptop in Peshawar, Pakistan, could 
bring down California's power grid is pretty far-fetched," said Kevin 
Terpstra, communications director for the California Department of 
Information Technology, an agency responsible for assessing the security of 
the state's computer systems.

"There is reason to be concerned about computer security and critical 
infrastructure vulnerabilities . . . but the likelihood of this type of an 
attack is very small."

Cyber-terrorism has become one of the hottest buzzwords among national 
security officials, especially since the Sept. 11 attacks. The subject has 
been the topic of numerous legislative hearings in Washington, D.C., and 
more than 560 newspaper and magazine articles using the term have been 
published in the past year alone.

In January, the FBI's National Infrastructure Protection Center warned that 
information on the Internet about power plants, toxic waste dumps and other 
sensitive sites could be used by foreign extremists to launch attacks on 
the United States.

And last week, the Business Software Alliance, a trade association, 
released an industry survey in which 59 percent of the information 
technology specialists polled said they considered a major terrorist 
computer attack likely in the next 12 months.

Underscoring the possible danger, several newspapers reported that computer 
operators in the Middle East and South Asia had attempted to penetrate 
computer systems in Northern California last fall.

However, experts interviewed by The Chronicle said the vast majority of 
these computer intruders are trying to steal information -- not shut down 
electrical utilities, release water from dams or engage in other dangerous 
acts of sabotage.

It is difficult, the experts say, for a hacker to launch an attack on an 
infrastructure control system because very few of these systems are 
accessible through the Internet.

In March, CIO magazine, a journal for computer system professionals, 
published a detailed article on information security that debunked the 
cyber- terrorist threat.

The magazine quoted Marcus Kempe, the director of operations for the 
Massachusetts Water Resource Authority, as saying a cyber-terrorist intent 
on tampering with his utility would have to make three complicated 
intrusions to gain access to the necessary control systems.
And he would have to break into a highly secure building in Massachusetts 
in order to make them because the system is not connected to the Internet. 
This would present a problem for the terrorist who thinks he can sabotage 
the utility by using his laptop in Pakistan.

"Could a computer attack get us to a high-consequence event? Probably not," 
Kempe told the magazine.

David Wagner, a computer science professor at UC Berkeley who specializes 
in information security, said some utilities do have operations that are 
controlled by means of the Internet, "but not all of them and maybe not the 
most critical ones."

"There are some crucial vulnerabilities," Wagner said, "but if you want to 
rank how serious those vulnerabilities are, they are less serious than what 
you can do with explosives and much less serious than what you could do 
with chemical or biological agents.

"I used to be concerned about cyber-terrorism, but I think in the past year 
I have come to realize that it is not the most serious thing we have to 
worry about."

Dorothy Denning, the director of the Georgetown University Institute for 
Information Assurance, testified before the House Judicial Committee two 
years ago that cyber-terrorism, while worthy of concern, was overrated as a 
threat to the American public. Denning told The Chronicle that her opinion 
has changed little since the Sept. 11 attacks.

"To get noticed, they would have to do something very dramatic, like flood 
a dam or something," she told The Chronicle. "Those kinds of actions are a 
lot more difficult to engineer with a computer than they would be with a 
bomb -- and whether they would work or not would be a lot less certain."

John Pike, a weapons systems analyst and director of Globalsecurity.org, a 
defense policy organization in Washington, D.C., stressed that terrorists 
use simple, direct methods for operations because they are less likely to 
fail.

He said the Sept. 11 attacks were a perfect example. "You had 20 people get 
on four planes to attack two targets," he said. "Only 19 made the flights, 
and only three of the planes reached their targets. But the plan succeeded 
anyway because it was simple."

He said cyber-attack scenarios are too complex to have much appeal for 
terrorist groups. Furthermore, they are likely to fail.

"If you pitch a bad script in Hollywood, the worst that can happen is you 
get thrown out of the office," he said with a chuckle. "If I were some guy 
from al Qaeda pitching a (complicated and risky) cyber-terrorism plot to 
Osama bin Laden, I would be a little nervous about making it out of his 
office alive. "

E-mail Bill Wallace at bwallace@xxxxxxxxxxxxxxxx
*************************
USA Today
Arab spelling slows inquiries in terror war
By John Diamond, USA TODAY

WASHINGTON  As U.S. intelligence and law enforcement agencies try to 
prevent the next terrorist attack, they have a basic problem to solve: how 
to spell the enemy's name.

Computerized databases at the FBI, CIA, Immigration and Naturalization 
Service and other agencies bulge with lists of suspected terrorists. Some 
of the names identify actual terrorists. Others are aliases, misspellings, 
alternative spellings or misidentifications of putative bad guys. And 
without extensive fieldwork, there is no way to tell them apart.

The confusion over names poses an obstacle for a law enforcement and 
intelligence community trying to track obscure terrorist operatives in 
scores of countries and thwart the next attack on the United States.

Problems cited publicly by the FBI and privately by CIA and INS officials:

Conflicting methods used by agencies to translate and spell the same name.


Antiquated computer software at some agencies that won't allow searches for 
approximate spellings of names.


Common Arabic names such as Muhammed, Sheik, Atef, Atta, al-Haji and 
al-Ghamdi.
"I can't tell you how many Mohamed Attas we've run across," said one 
intelligence official who spoke on condition of anonymity. He was referring 
to the name of the lead hijacker in the Sept. 11 attacks.

"These people generally don't wear 'Hello, My Name Is' nametags."

In the weeks after Sept. 11, Justice and Treasury officials compiled a list 
of some two dozen alleged al-Qaeda operatives and financiers. The officials 
asked that Secretary of State Colin Powell pass the list on to the Saudi 
foreign minister with a request that the bank accounts of the individuals 
be frozen.

A State Department official with knowledge of the episode said the list 
amounted to a bunch of nicknames, Arabic versions of mobster handles such 
as "Vinny the Chin."

There were also several named "Mohammed al-Haji," not a family name but a 
term of honor indicating a person has made the Islamic pilgrimage to Mecca.

When the State Department passed on the list, the Saudis greeted the 
request with laughter. They said the "names" were of no help in finding 
terrorist bank accounts, the official said.

Days after the attack, Waleed al-Shehri, a pilot and son of a Saudi 
diplomat, threatened to sue a U.S. network for televising his picture as a 
suspect. The FBI had said that a man with the same name was on one of the 
hijacked planes.

To illustrate the problem, one CIA official searching a database on Libyan 
leader Moammar Gadhafi found more than 60 different published spellings of 
his name  confusing when the subject is a known figure, dangerous when he's 
an obscure terrorist.
*************************
USA Today
U.S. struggles with outdated databases
By John Diamond, USA TODAY

WASHINGTON  Since the attacks on Sept. 11, the Bush administration has been 
scrambling to increase funding for computer hardware and software to 
organize a flood of terrorism-related information.

The FBI's computerized storage and search capability was so woeful that the 
bureau went to the Mormon Church for help this year. The Mormons maintain a 
database containing millions of names, including alternate spellings, used 
by people doing genealogical research on European ancestry.

Government databases  with names such as the Modernized Digitized 
Intelligence System and Joint Virtual Intelligence Architecture  remain far 
behind their private sector counterparts.

"It's a 30-year-old, archaic system," one senior intelligence official 
said. "You can't find anything in there."

Tracking thousands of obscure individuals from countries not known for 
their record keeping is a relatively new challenge for an intelligence 
community that came of age counting missile silos and bomber bases in the 
Soviet Union.

The CIA and the Immigration and Naturalization Service have been developing 
sophisticated computer programs to expand the government's search 
capability. The capture of hundreds of suspected al-Qaeda members in 
Afghanistan and the arrest and questioning of more than 2,000 terror 
suspects around the world has helped authorities develop a "biometric" 
database  fingerprints, photographs, DNA samples. Biometric data can help 
determine an identity more reliably than "biographic" information, such as 
names and birthplaces, which can be falsified.

The INS has developed a forensic document lab with a growing body of 
information on terrorists, including standardized procedures for 
translating and spelling names. Translating names to English from Arabic 
can result in a variety of spellings. But these procedures aren't always 
used by other U.S. agencies.

The CIA, meanwhile, has developed a "link analysis system" in its 
Counter-Terrorism Center that can help investigators determine family 
relations among suspected terrorists.

At the FBI, computer systems lag years behind the latest industry standard.

"The CIA is ahead of us," FBI Director Robert Mueller told a Senate hearing 
last week. "One of the deficiencies is, if I put my name in (the FBI 
computer) you have to put it in exactly, M-u-e-l-l-e-r, you have to put it 
in explicitly. It will not pull up any variations."

A U.S. intelligence official describes how glitches can occur: The National 
Security Agency intercepts communications among suspected terrorists that a 
"Khalid" will be attending a key meeting. But was that "Khalid" or perhaps 
"Khalad"? And given that the name is about as common in the Arab world as 
Smith is in the USA, how can intelligence operatives identify the participant?

Adding to the difficulty is the flood of al-Qaeda suspects that U.S. 
intelligence and law enforcement must follow.

In the three months before Sept. 11, the CIA forwarded an average of 300 
names per month to U.S. agencies watching for terrorist activity. In 
September, the number spiked to nearly 1,000. In October, it peaked at 
1,400 names. It has leveled off at less than 900 new names per month. And 
that's only the names being gathered by the CIA. The FBI, INS and other 
agencies have their own lists.

One former national security official questions the focus on individuals.

"Surveillance of the means that terrorists could employ is potentially more 
important than surveillance of persons who might be terrorists, and raises 
far fewer civil liberties issues," Ashton Carter, a senior Pentagon 
official in the Clinton administration who is now at Harvard, told senators 
at a recent hearing.

Keeping tabs on all Middle Eastern males in the USA would be excessive, 
Carter said.

"But inquiring after all those who take flying lessons but are not 
interested in learning to take off or land, who rent crop dusters, or who 
seek information on the antibiotic resistance of anthrax strains or the 
layout of a nuclear power plant is feasible and extremely useful," Carter said.

The government already is tracking individuals who appear interested in 
breaking into sensitive government computer networks. The Pentagon and 
other agencies try to lure out potential cyber-terrorists using "honey 
pots," Web addresses with titles that might attract plotters by including 
references to a senior official's personal files or words that suggest they 
might contain classified information. The government can track who logs 
onto such sites and pursue their identities.
**************************
Washington Post
In-Q-Tel, Investing In Intrigue
CIA Unit Scours Country For Useful Technologies
By Shannon Henry

Like "Q," the gadget-maker who keeps James Bond perpetually ensconced in 
the latest high-tech gear, Gilman Louie is looking for technologies and 
ideas to give American spies an edge.

Louie is the founding chief executive of In-Q-Tel, the venture capital unit 
of the CIA that -- no kidding -- named itself after the movie character. 
The group, created in 1999, has made about a dozen investments in 
technologies that could potentially be used in information gathering and 
analysis of America's enemies.

It was always a controversial concept -- the U.S. intelligence community 
openly investing in pieces of commercial technologies. Why wouldn't it just 
buy a technology outright or develop it themselves? But the benefits of 
having In-Q-Tel's fingers in a lot of commercial technology pies were 
demonstrated after Sept. 11, when In-Q-Tel found itself a go-to group. 
Suddenly, it was necessary to scour all parts of the country for 
technologies that could be used for counterterrorism and homeland defense. 
A vital concept could come as easily from a Las Vegas entrepreneur intent 
on catching crooks in casinos as a government researcher toiling away in a 
laboratory.

Government agencies came to the organization for technological advice and 
expertise. Companies' executives began deluging In-Q-Tel's Rosslyn offices 
with business plans -- two to three times the number before the attacks, 
about 150 a month.

In no time, In-Q-Tel became a sort of anti-terrorism matchmaker, 
introducing those with problems to those with high-tech detective 
abilities. Several federal agencies, including the Army, the Navy, the 
Defense Department and the National Aeronautics and Space Administration, 
also are studying whether it is possible to replicate the In-Q-Tel model or 
partner with the enterprise in some way, Louie said.

"Everybody is watching and trying to figure out how it will fit into their 
culture," Louie said.

In-Q-Tel's development marks a stark departure from the way government 
research and development often is conducted, often in secret and distinct 
from the commercial sector.

Louie spends half his time in Washington, meeting with politicians, 
lobbyists, government administrators, local technologists and financiers. 
He spends the other half in Silicon Valley, where he networks with venture 
capitalists and tests out ideas for new technologies.

"The fun part is going into [CIA headquarters at] Langley and talking to 
national security people and giving them tools to get their jobs done," 
Louie said.

So what is he looking for these days?

Because the organization is part of the CIA, after all, Louie will not get 
into specific details of what he is looking for or why. But In-Q-Tel is 
focusing much of its energies on tracking terrorists, finding links between 
criminals and even guessing what they might do next.

Over all of these efforts is the apparent lack of information sharing and 
some crucial lapses in analysis that took place before Sept. 11, when 
different parts or offices of the CIA and the FBI were not able to pursue 
leads that might have led to the hijackers. Technology, or the lack of it, 
in FBI field offices has been cited frequently as an issue in these failures.

Solving such "knowledge management" problems is top on Louie's list, 
particularly using technology to see patterns and massive amounts of data. 
"How do we make information overload our friend?" he said. "Can you be 
predictive?"

He also is looking closely at distributed computing systems -- how networks 
can be linked and how people in different places can share information.

Louie said he gets many of his tips for promising technologies from 
traditional venture capitalists. "They have my laundry list, and I have 
theirs," he said. He found one investment, Attensity, a 
natural-language-processing company in Salt Lake City, when a venture 
capitalist suggested he take a look.

He compares Attensity's software, which extracts common threads of 
information out of documents, to a kind of high-tech sentence diagramer. 
In-Q-Tel often will invest in companies like Attensity, which have created 
products for the commercial market that might also have government application.

Although it would not say exactly what they were doing with it, In-Q-Tel is 
now piloting Attensity's software, which was created to comb through vast 
databases to help large corporations understand more quickly what their 
customers are telling them. For example, do customer complaints about a 
certain toaster suggest design changes, or is a recall warranted? Todd 
Wakefield, chief executive of Attensity, compares those customers with 
field agents of a government office.

"The intelligence community's issue isn't gathering data, it's analyzing 
it," Wakefield said. "Their biggest problem is free-form text."

For Wakefield, In-Q-Tel's attention was a company-saver. A huge commercial 
deal that was to be signed Sept. 12 fell through after the attacks. He 
thought about getting on the General Services Administration schedule to 
sell to the government but figured it would take too long to get 
established. In-Q-Tel's interest helps build credibility.

David Gilmour, chief executive of Tacit Knowledge Systems in Palo Alto, 
Calif., said it had never occurred to him to market his software to the 
government. His customers were huge pharmaceutical and aerospace firms that 
wanted their employees, often working in widely dispersed satellite 
offices, to share information better by understanding who was working on 
what. In-Q-Tel heard about Gilmour and invested $1 million, and is actively 
using Tacit technology.

"It translates directly to the problems we read about every day in the 
headlines" about the FBI's management problems, Gilmour said. He said so 
much important information, such as informal notes, is not easily 
searchable online.

And then there was the Las Vegas inventor who created "link analysis" for 
casino owners to use to spot illegal activity among gamblers and dealers. 
Louie, who talks quickly and excitedly, said: "Casinos want to catch these 
guys in real time." And so do spies.

So Systems Research and Development of Las Vegas became one of In-Q-Tel's 
investments. SRD claims to be able to show up to 30 degrees of separation 
from any person -- a banker in Tucson knows a broker in Dallas who knows a 
hotel owner in Miami and so on. "We deliver an investigative clue," said 
John Slitz, chief executive of SRD. Company founder and chief scientist 
Jeff Jonas says the software in three minutes can find if a person is a 
known terrorist or linked to one by entering a name in a database.

About 20 percent of SRD's current business is with the government, and 
company officials hope to see it jump to 50 percent in the next year.

In-Q-Tel is building an extensive portfolio, but there are still many 
challenges, not the least of which is the shock of the new in the culture 
of the CIA. Louie said it was difficult to convince everyone, commercial 
and government types alike, that investment in computer infrastructure, not 
just spying gadgets, is necessary.

"It's a real funding issue," Louie said. Right now, In-Q-Tel has a $30 
million annual budget and 45 employees. But the venture capital model 
allows In-Q-Tel to stretch those dollars across many technology bets.

In-Q-Tel judges investments differently from most venture capitalists, who 
look toward a company "exit strategy," usually an initial public offering 
or a merger. Louie said obviously they want to invest in successful 
companies that will not disappear, but candidates more importantly need to 
show a technology that works, one that can solve a problem at a government 
agency, or even address a problem no one had perceived before. Through 
these investments, In-Q-Tel becomes a special customer with a greater 
knowledge of how the technology can work for government agencies, and 
encourages innovation that might otherwise fade away. Louie said In-Q-Tel 
does not ask for exclusivity arrangements because the organization's whole 
point is to leverage commercially available technology.

"We are casting a big, high net and we are talking to everybody and 
anybody," Louie said. "We can't afford to get it wrong."
**************************
Government Executive
E-learning site to debut next month
By Brian Friel
bfriel@xxxxxxxxxxx

Federal employees will be able to take free courses about sexual 
harassment, diversity, ethics and other topics on a new e-learning Web site 
that will debut next month, Office of Personnel Management officials said 
Thursday.


The new site is an attempt by the Bush administration to use the purchasing 
power of the 1.8-million federal employee user base to lower the costs of 
training and to reduce redundant training efforts across the federal 
government.


Norm Enger, OPM's e-government program director, and Mike Fitzgerald, the 
agency's e-training director, said OPM and the Transportation Department's 
Administrative Services Center plan to launch the new site on July 23. The 
site was going to be called the National Learning Center, but officials 
decided Thursday to chnage the name to the Gov On-line Learning Center. The 
site will be available at www.golearn.gov when it debuts.


To run the site, the agencies have awarded a contract to GeoLearning, a 
West Des Moines, Iowa-based learning management system provider. The 
GeoLearning system handles online enrollments, course management and 
tracking reports. Courses will be provided by Nashua, N.H.-based SkillSoft, 
Naperville, Ill.-based NetG and San Antonio-based Karta Technologies.


The Bush administration's plan to unify training across the government 
comes after many federal agencies have spent years developing their own 
e-learning programs. The National Security Agency, for example, runs a 
program called FasTrac, through which 56 agencies, including the Navy, 
Health and Human Services and Labor departments, provide online training to 
their employees. The Treasury Department's Franchise Business Activity in 
San Antonio, Texas, handles contracting for the NSA program.


While up to 40 courses will be free to federal workers on the new 
e-learning portal, OPM and the Transportation Department will start 
charging federal agencies for more extensive online training programs 
offered by the new site in November.


Enger said agencies will not be required to use the e-learning portal, but 
officials say they hope that federal e-learning managers will decide that 
they can get the best service and prices through the OPM-Transportation 
site. FasTrac administrators say they have lower prices than 
Transportation, but that they're willing to work with the 
OPM-Transportation officials.


Some e-learning vendors said they don't like the plans for the new site, in 
part because it may cost them business in the federal market. "On the 
surface, I think it's a good idea," said Matt Adams, public sector vice 
president for Saba, a Redwood Shores, Calif.-based competitor of 
GeoLearning. "It's just how they have adopted it. It wasn't a full and open 
competition. The other question is, what do you do with all the investment 
that agencies have already made. Do you throw the baby out with the bathwater?"


OPM and Transportation selected the site's contractors from among companies 
that were awarded spots on an existing Transportation contract more than a 
year ago. Fitzgerald said companies had the opportunity to compete then. 
Companies will also have opportunities in the future to participate in the 
contract as the scope of the site expands, Fitzgerald said. "We're not 
locked into any one vendor," he said. "With this industry, today's players 
are sometimes not tomorrow's players. This doesn't lock anyone out."

Fitzgerald said he has talked with officials from other agencies that have 
created similar sites. "We're open to forming partnerships with them," he 
said.

OPM officials decided to work with Transportation after its Virtual 
University project won accolades from the federal Chief Information 
Officers Council and other groups. Transportation officials also 
volunteered to help administer the new site.

Over the past few years, the Air Force, Navy and Army have developed their 
own extensive online training programs for military personnel and civilian 
employees. Veterans Affairs, the National Oceanic and Atmospheric 
Administration and the Bureau of Prisons are among other agencies that have 
e-learning programs under way.
*************************
Washington Post
'Digital Divide' Less Clear
As Internet Use Spreads, Policy Debated Anew
By Ariana Eunjung Cha

LOS ANGELES -- Researchers mining the data from their survey of 2,000 U.S. 
households recently came across an interesting fact about the "digital 
divide." There isn't one. Or, at least, the divide that once was clear 
seems to be disappearing.

A team from the University of California at Los Angeles found that the gap 
between those who have Internet access and those who do not is closing when 
measured by the degree of education computer users have attained.

A separate government report showed the gap disappearing between urban and 
rural users, and the Pew Research Center said its analysis of Internet use 
found that the division is narrowing between whites and African Americans.

The conclusions have prompted a political fight. The Bush administration 
has seized upon the findings as a reason to reduce funding for programs 
that bring computers to low-income Americans. That has riled advocates for 
disadvantaged communities, who say reports that the digital divide has been 
closed are premature.

Each side accuses the other of twisting the statistics to support its position.

Sen. Barbara A. Mikulski (D-Md.) and others argue that the studies are 
inconsistent. And even if more disadvantaged people have access to 
computers now than before, that does not necessarily mean that they have 
the skills to use the Internet to do things like find jobs, look up medical 
information or find information to help them make financial decisions, she 
said.

Last month, Mikulski joined 100 community, labor and professional 
organizations -- including the Leadership Conference on Civil Rights, the 
AFL-CIO and the National Education Association -- to fight for more funding 
to close the digital divide.

The government has proposed to cut two programs from the fiscal year 2003 
budget that once called for a total of $110 million in funding: the 
Education Department's Community Technology Centers program, which builds 
labs for after-school and adult-education use; and the Commerce 
Department's Technology Opportunities Program, which helps local groups 
install computer networks.

The Bush administration argues the programs no longer are necessary and 
that, since Sept. 11, the government has other priorities. Congress is 
likely to decide this fall whether to resurrect the projects.

The Commerce Department program, which provided Internet consulting 
services, "was created when the Internet was not very understood," Office 
of Management and Budget spokeswoman Amy Call said. "It was a foreign land 
to most people. Obviously, now there has been a dramatic rise in Internet 
familiarity."

Michael F. Gallagher, deputy director of the National Telecommunications 
and Information Department, said the administration "recognizes and 
appreciates the critical importance that we have Internet connections for 
the entire country."

"Where we differ with some people is how we address the issue," he said.

Gallagher said the government prefers to cut taxes and provide more general 
education programs so that people can buy and use computers without subsidies.

The national studies from UCLA, the Commerce Department and Pew all report 
evidence that the gap between the high-tech "haves" and "have-nots" is 
closing in three areas:

? Education. The UCLA study shows that in 2001, about 65 percent of those 
who did not graduate from high school used the Internet, compared with 60 
percent of high school graduates and 80 percent of those with some college 
education. The previous year, 60 percent of those who did not graduate from 
high school used the Internet, compared with 54 percent of high school 
graduates and 70 percent of those with some college education. The 
telephone survey has a margin of error of plus or minus 3 percentage points.

? Geography. The Commerce study shows that about 54 percent of the total 
population had access to the Internet in 2001; in rural areas alone, 53 
percent of the population had access. The statistics were taken from the 
U.S. Census Bureau surveys and are based on interviews with 57,000 
households and have a margin of error of plus or minus 0.6 percentage points.

? Race. A 1998 Pew study found that 23 percent of blacks and 42 percent of 
whites had Internet access. In 2000, the percentage of black adults who 
have Internet access grew 13 percentage points, to 36 percent; for whites, 
the online population grew 8 percentage points, to 50 percent. Pew surveyed 
2,500 adults; the margin of error is plus or minus 3 percentage points.

But the Benton Foundation, which is part of the coalition trying to save 
the government-funded digital divide programs, argues that the government 
is interpreting the studies with what it calls "a glass half full" 
approach: They are focusing on the gains made by certain groups rather than 
the gaps themselves.

Norris Dickard, a senior associate at Benton, said his analysis of the 
Commerce data shows that the gap in terms of race, income and education is 
widening, not shrinking. Dickard said there is a new digital divide 
emerging between those who have access to high-speed Internet and those who 
have access only to slower dial-up services, with poor, rural and ethnic 
communities particularly at a disadvantage.

"Soon there will be all these exclusively broadband applications out there 
that will be really important for the growth of communities," Dickard said, 
citing telemedicine, in which doctors remotely diagnose and treat patients, 
as an example.

Mark Cooper, director of research for Consumers Union, said assertions the 
digital divide is fading are "simply wrong." Cooper said the government's 
conclusion was based on looking at numbers about people's computer use in 
the wider community when it should be focusing on the availability of 
access in the home.

"This is America and we do our business at home. This is not a cafe 
society," he said.

If you count computer use at home and at work, fewer than half of those 
with annual incomes of $15,000 to $25,000 can get onto the Internet, 
compared with about 90 percent of those with annual incomes more than 
$75,000, according to the Commerce survey. If you count Internet access 
only at home, less than a quarter of those with annual incomes of $15,000 
to $25,000 have access, compared with more than 80 percent of those with 
incomes more than $75,000 a year.

Only 32 percent of Hispanics and 40 percent of blacks had Internet access 
at home in 2001, compared with 60 percent of whites.

Jeffrey Cole, head of the UCLA study, stands by his interpretation that the 
most basic divide -- access -- is narrowing by most measures. But he also 
believes that a divide remains when it comes to how people use the 
Internet. For example, new users on average spend more of their online time 
on entertainment, while experienced users spend more time doing things such 
as banking and professional work. That, Cole said, suggests that some 
minority and low-income families haven't yet developed the skills to use 
the Internet as effectively as others.

"There are still significant differences between those who have been online 
five years and more and those who just went online," he said.
************************
Associated Press
China Threatens Internet Cafe Owners
Sat Jun 29, 3:09 AM ET

BEIJING (AP) - China has threatened the operators of unlicensed Internet 
bars with criminal prosecution as part of a safety crackdown launched after 
a fire at an Internet cafe in Beijing killed 25 customers, state media 
reported Saturday.


From July 1 to August 31, unlicensed cyber cafes will be shut down and the 
owners prosecuted, Xinhua News Agency quoting Ministry of Culture official 
Liu Yuzhu as saying. No new Internet bars will be allowed to open during 
that period, the report added.

Legal cafes have to reregister by Oct. 1, Liu said, and will have to pass 
safety inspections. According to the Ministry of Culture, only 46,000 of 
China's 200,000 Internet cafes are registered.

Cyber cafes across the country were ordered closed for safety inspections 
after a June 16 fire at an illegal Internet bar in Beijing killed 25 
customers and injured 12. The closures coincided with a nationwide 
crackdown in which thousands of cafes have been shut over the past year for 
failing to install software to track the sites visited by users.

China's communist government tightly controls content on the Internet, 
blocking sites considered subversive or obscene.
*************************
New York Times
Grudgingly, Music Labels Sell Their Songs Online
By AMY HARMON

Increasingly desperate to woo customers away from an Internet music piracy 
party that shows no signs of abating, several major record labels have 
resolved to make more music legally available for less money online  even 
if it means sacrificing lucrative CD sales.

For the music industry, it is a turning point. For consumers, it means the 
advent of new ways to buy music, including the closest approximation so far 
of a "celestial jukebox," where they can search for and listen to a vast 
range of recorded music at low cost.

Three years after Napster unleashed the first wave of music-trading over 
the Internet  and a full year after the company was shut down by a court 
order  the labels are coming to terms with the notion that Internet 
file-sharing is reshaping their business, and they must compete with piracy 
or risk losing a generation of customers.

The Universal Music Group plans to announce today that it has licensed its 
catalog to Listen.com, making Listen.com the first to provide customers 
access to the catalogs of all five major labels over the Internet for under 
$10 a month. Other services are making individual songs cheaper to get and 
easier to burn to CD's legally.

"We could be 100 percent correct morally and legally that it is wrong to 
trade copyrighted files, but from a business standpoint it doesn't matter," 
said Larry Kenswil, president of the eLabs division of Universal. "We need 
to construct legal alternatives."

A Justice Department investigation into whether the five major recording 
companies are trying to control electronic music distribution may have 
spurred Universal's agreement with Listen.com, which took 16 months to 
negotiate. Two separate groups of music companies control the two leading 
online services, MusicNet and Pressplay, but they have stumbled in part 
because neither of them has licenses for each others' complete catalogs.

But the chief driver of the music labels' new willingness to take more 
risks online is the 5 percent decline in worldwide sales last year and a 
continuing slump this year, which they attribute in large part to digital 
piracy. As the successors to Napster multiply and file-sharing gains 
cultural acceptance, the record labels are beginning to fear that music 
will be permanently devalued.

Recorded music "will be used to promote the artist, and the labels will 
need to find other sources of revenue," predicted Starling D. Hunter III, 
an assistant professor at M.I.T, who studies the impact of technology on 
established industries.

It was in part to avoid that from happening that the labels have kept a 
tight grip on the legitimate distribution of their music online. They have 
also been determined not to cede potential profits to aspiring Internet 
distributors as they did to MTV in the early 1980's in establishing a 
licensing model that many music executives view as the costliest error in 
the industry's history.

As a result, they have been slow to license their catalogs to online 
subscription services. They have charged upwards of $2 for an individual 
song through their own download services. They have experimented with 
copy-protection on CD's, imposed strict limits on recording songs to blank 
CD's and almost unanimously declined to license music for transfer to MP3 
players.

But now, industry executives are considering the paradox that in order to 
control music distribution more tightly in the long term, they may have to 
loosen their hold over it in the near term.

"This really represents a turning point in the approach and attitude of the 
major music companies toward digital distribution," said Chris C. Gladwin, 
chief executive of Full- Audio, which plans to announce today that Warner 
Music has agreed to let it sell its songs for CD burning for around 99 
cents a download. "They're beginning to see it as a big part of their future."

In the last few weeks, Warner has quietly agreed to allow the MusicNet 
subscription service it co-owns with the BMG division of Bertelsmann the 
EMI Group and RealNetworks to let customers record the tracks they download 
onto CD's. Warner is also selling songs from artists like the Red Hot Chili 
Peppers, Brandy and others for 99 cents through a "Digital Singles" pilot 
on America Online. Those songs are in MP3 format, which means they can be 
copied to portable players or over the Internet.

Universal, the biggest of the labels, said it planned to offer its catalog 
for download later this summer at 99 cents a song, or $9.99 an album. And 
Sony recently lowered the price of its copy-protected downloads to $1.49 
from $1.99. Still, critics argue that the recent steps are too little and 
that it may soon be too late for the labels to rescue their position as the 
gatekeepers of popular music if they refuse to more aggressively embrace 
online distribution.

Selling songs for 99 cents online gives the labels about the same profit 
they make per track on a CD, industry executives said. But many believe the 
price must drop to 25 cents to persuade customers to pay for music instead 
of stealing it. Some executives who run online music services say all of 
the labels need to make their catalogs more broadly available, with fewer 
security restrictions.

To judge from the online discussion boards at Pressplay, that is what 
customers think too.

"All I have to say is the Aimster has a lot more to choose from, and it's 
free!" read one recent message, referring to a file-trading network now 
known as Madster, where copyrighted music is traded for free.

None of the online services offer a central location where customers can 
download any song from any label. The Rhapsody service of Listen.com 
enables customers to listen to an unlimited number of songs for $9.95 a 
month, but they must be connected to the Internet. With Pressplay and 
MusicNet, customers can download songs to a computer, but they can no 
longer play them once they stop paying the monthly fee. Pressplay allows 
customers to burn 10 songs to a CD each month, but only two songs from the 
same artist.

Even when music labels agree to license their catalogs, many songs from 
popular artists are not included because the labels cannot come to terms on 
how much they should be paid for digital distribution.

With such restrictions, leaders of subscription services say they will 
never be able to attract customers who can get online music for free 
elsewhere. "Besides, what's Plan B? said Alan McGlade, the chief executive 
of MusicNet. "If the legitimate services blow up, everyone is still 
stealing from you."

In the utopian view of online music distribution, everyone wins. The 
industry will prosper by reselling its catalog just as it did with cassette 
tapes and CD's. A broader range of artists will benefit because the labels 
will be more inclined to promote albums that may only sell 200,000 copies, 
rather than devoting limited shelf space to sure hits. The ability to 
easily preview songs online will induce people to try new bands and buy 
more music in both digital and physical form. As a result, more people will 
listen to more kinds of music in more ways than ever before.

But advocates of such radical change within the labels face the hurdle of 
persuading cash-strapped executives  whose quarterly goal is to sell more 
CD's  to put even more of their bottom line at risk.

At 25 cents a song, the labels would make only about 10 cents a download, 
said one record executive who declined to be identified  and that is 
assuming the music publishers agreed to take less than the 8 cents a 
reproduction that they are entitled to by law. The labels make about $5 
profit on a typical CD sale, which means in order to maintain the same 
margins they would have to sell 50 digital downloads for every CD that 
someone doesn't buy because they purchased a song online.

Of course, some people who pay for a song online may still buy the CD, and 
others who may never have purchased a CD may buy digital downloads. If even 
a small fraction of the files traded for free over the Internet each day 
were instead purchased for 25 cents, the record industry would stand to 
make hundreds of millions of dollars a year.

The effect on retail sales  referred to in the record industry as 
cannibalization  is the current preoccupation of many record executives as 
they search for the right balance to strike between presenting appealing 
alternatives to piracy and risking future profits.

"Everyone tells us to get a new business model but no one has told us what 
it is," said Doug Morris, the chairman of Universal. "It would be easy to 
say to Chevrolet, `Sell your cars at a lower price, you'll sell more.' But 
I'm not sure that means anything. We're not going to price at a point where 
we devalue music. That wouldn't be fair either to us or to the artist."

The difference is, no one is giving Chevrolets away around the corner. 
Thirty-one million Americans have shared music files on their computers 
with others, according to a recent survey by the Pew Research Center. Such 
numbers still inspire outrage among record label executives who resent 
having to adjust to a situation that seems fundamentally unfair.

"The hardest thing for the music industry to wrap its head around is how do 
we compete against free, even though you know intuitively that free isn't 
what's supposed to be happening," said Ted Cohen, vice president for new 
media at EMI.

But that, increasingly, is what they are trying to do.

"It was self-interest," said Sean Ryan, the chief executive of Listen .com 
of what broke the 16-month logjam in his negotiations with Universal. "It 
wasn't because they were nice people."
***************************
New York Times
A Dispute Over Wireless Networks
By PETER MEYERS

Time Warner Cable sent some of its New York City cable-modem subscribers 
letters last week warning that operating wireless networks and inviting 
others to freely share them violated their subscription agreements.

The company's action highlights a potential conflict between a small number 
of advocates of free, wireless networking and the broadband providers who 
supply their Internet connections.

Fewer than a dozen letters were sent, according to the company, a unit of 
AOL Time Warner. The letters cited a clause in the subscription agreement 
prohibiting redistribution of the company's Internet connection service.

Barry Rosenblum, president of Time Warner Cable of New York City, said he 
had no problem with users who share a wireless network within their own 
homes. What the company objected to, he said, were subscribers who used 
their networks to provide Internet access at no charge to others outside.

"We're trying to keep people from redistributing the service we sell them," 
Mr. Rosenblum said. "Our concern is when people specifically bolster the 
signal to share with others outside."

That is the aim of the so-called free wireless network groups that have 
emerged in many large American cities. These groups, including NYCWireless 
in New York, encourage individual users to establish, publicize and share 
wireless networks.

At the heart of the conflict lies a technology known as Wi-Fi, for wireless 
fidelity. Wi-Fi networks use radio signals to broadcast an Internet 
connection as far as 300 feet, permitting users with properly equipped 
computers to connect to the Internet at high speeds without wires.

Many Wi-Fi networks, intentionally or otherwise, allow passers-by to use 
the networks without any password. And there are tools that amplify the 
Wi-Fi radio signal, enabling it to be delivered over an even larger area, 
like a park.

Many broadband providers fear that every user of a free wireless network is 
one less paying customer. "Our goal is just to protect our customer base," 
said Mr. Rosenblum, adding that Time Warner Cable currently had no plans to 
extend this enforcement campaign to other areas that it serves.

Mr. Rosenblum acknowledged he had no way of knowing how many of these free 
wireless networks were being operated, or how much money, if any, they were 
costing the company. Among the sources Time Warner Cable consulted to track 
violators were public Web sites that promote the existence of these 
networks, including one operated by NYCWireless.

In at least one case a letter was sent to a user who said he had not 
actually set up a wireless network. "I don't actually have any wireless 
equipment; I've never had any wireless equipment," said Justin Cobb, a 
Manhattan resident who had indicated on the NYCWireless Web site that he 
was potentiality interested in some of the group's future projects.

Mr. Cobb said he understood Time Warner's need to prevent nonpaying users 
but was also "really bothered by the fact I'm being accused of criminal 
activity." He said he was considering switching Internet service providers.

For the moment, most publicly available wireless networks are limited to 
small areas such as sidewalk cafes and parks, but several groups have 
discussed finding ways to create a free wireless "cloud" that would offer 
Internet access to larger areas.

More immediately, broadband providers worry about situations in which one 
person pays for a broadband connection, then sets up a Wi-Fi network and 
shares it with a neighbor. Such an agreement would be illegal under the 
terms of Time Warner's current policy.

There are, however, some smaller Internet providers that have promoted 
themselves as friendly to free wireless in the hope that the customers 
gained will offset potential revenues lost through freeloading.

Arkady Goldinstein, chief executive of Acecape, a digital subscriber line 
provider based in New York, said it was "purely a cost-benefit analysis" to 
allow his customers to set up free networks. Mr. Goldinstein added that out 
of his firm's "several thousand" subscribers he believed "less than a 
dozen" have set up free networks.
*************************
Washington Post
Web publishers sue over pop-up ads

NEW YORK (AP)  Complaining of parasitical behavior, some of the nation's 
largest news publishers are suing Internet advertising company Gator over 
software that triggers pop-up ads when surfers visit their Web sites.

"We make all the investment to gather and collect news and set up an 
attractive Web site," Terence Ross, an attorney for the publishers, said 
Friday. "Gator, without making any equivalent investment, reaps the profits."

The lawsuit was filed this week in U.S. District Court in Alexandria, Va., 
by a group that includes parent companies of The New York Times, USA Today 
and USATODAY.com, The Wall Street Journal and The Washington Post, as well 
as the digital arms of Knight Ridder and Conde Nast.

In it, the publishers call Gator "a parasite on the Web that free rides on 
the content of others." They seek an injunction and unspecified damages.

Gator, based in Redwood City, Calif., runs an ad network that claims 22 
million active users and 400 advertisers.

Internet users get Gator advertising software when they install a separate 
product for filling out online forms and remembering passwords.

Gator also comes hitched with free software from other companies, including 
games and file-sharing programs.

As users surf the Web, Gator runs in the background and delivers 
advertisements on top of what the surfer would normally get at a site.

Though the Gator ads are marked "GAIN"  for Gator Advertising and 
Information Network  many consumers won't know the difference and will 
instead blame the site for an unpleasant experience, Ross said.

He acknowledges that some of the publishers, including the Times, do 
deliver pop-up ads, but he said their timing, frequency and nature are 
typically controlled.

"What if in a story covering the tragic event of Sept. 11, Gator suddenly 
popped up an advertising for a flight training school?" Ross said. "That 
would be wholly inappropriate."

In some cases, the lawsuit charges, Gator's ads are for services that 
compete with the publishers'  for example, a Travelocity.com ad appears 
while surfing CondeNet's concierge.com. Both provide travel-related services.

In a statement, Gator pledged to vigorously defend the lawsuit. To Gator, 
its pop-up windows are no different than what happens when a user runs 
instant messaging, e-mail or other programs in separate windows while 
surfing a Web site.

"While we understand why these publishers of advertising-supported Web 
sites feel threatened by us, we are certain that being a strong and 
thriving competitor is not illegal," said Jeff McFadden, the company's 
chief executive.

In response to questions via e-mail, McFadden said Gator may file its own 
lawsuit seeking a declaratory judgment that consumers have the right to 
decide what is displayed on their computer screens and that Gator's 
practices constitute lawful competition.

Responding to the publishers' claims of copyright and trademark 
infringements, Gator said its practices do not involve copying of the 
publishers' site or using their trademarks.

But Ross said Gator could be held liable because ads block copyrighted 
material  and hence its presentation  and could confuse visitors into 
thinking the pitches were authorized by the Web site.

Gator's advertising practices have come under fire before.

Last year, the Interactive Advertising Bureau threatened to file a 
complaint with the Federal Trade Commission over Gator's selling of ads 
that block out the ads displayed on other Web sites. Gator responded with a 
federal suit against the trade group. Gator ultimately agreed to stop the 
practice.
*************************
USA Today
Real-life hacker writing unreal account

NEW YORK (AP)  Barred by the terms of his probation from messing with 
computers, ex-convict hacker Kevin Mitnick has turned to writing about 
them, baring the tricks of his former trade in a forthcoming book.

An advance copy of the book, The Art of Deception, describes more than a 
dozen scenarios where tricksters dupe computer network administrators into 
divulging passwords, encryption keys and other coveted security details.

But it's all fiction. Or so says Mitnick.

Those seeking Mitnick's version of his lawless escapades will have to wait. 
Personal details are carefully expunged from the book, which uses 
fictitious names of hackers, victims and companies.

"It's not the Kevin Mitnick story," said Mitnick, 38, of Thousand Oaks, 
Calif., who served five years in federal prison for stealing software and 
altering data at Motorola, Novell, Nokia, Sun Microsystems and the 
University of Southern California.

He was released in January 2000 and is currently on three years' probation.

"This book isn't about my cases, it's creating fiction stories with the 
same techniques I've used and others have used," he said.

Mitnick says his message is aimed at computer security professionals, to 
help them stop people like him. But he agreed his tricks would also make 
good fodder for the dishonest.

"The information can be used for good or bad," he said.

The book's contents, to be released in October, are probably too tame to 
interest a malicious hacker, said Bruce Schneier of Counterpane Internet 
Security in Cupertino, Calif.

"The bad guys don't need to read this book," Schneier said. "But the good 
guys need to know what the criminals are doing."

Mitnick is best known for leading the FBI on a three-year manhunt that 
ended in 1995 when agents collared him in an apartment in Raleigh, N.C. 
with the help of a top academic security expert.

During the chase, the bespectacled outlaw continued to break into computer 
networks. He was considered a cult hero among hackers and a slippery felon 
by the federal judge who finally sentenced him.

"We've had a terrible, terrible time with this defendant," U.S. District 
Judge Mariana Pfaelzer said during a June 2000 hearing.

In his hacking heyday, Mitnick was described as an overweight, pimpled 
young man obsessed with fast food.

He has since undergone an image makeover. He's slimmed down, sports a 
stylish haircut and has appeared on television, in the courtroom as an 
expert witness and even before Congress.

Mitnick's life still revolves around weekly visits to Larry Hawley, his 
federal probation officer, who declined to return calls seeking an 
interview. Hawley is said to be keen to read his client's forthcoming book.

"He will be going over it in some detail," said a probation official in Los 
Angeles who spoke on condition of anonymity.

To be able to prevent the government from handing the book's earnings to 
his victims, Mitnick said he navigated between his probation roadblocks and 
the court-imposed restrictions on profiting from tales of his crimes.

"We've been very careful, we have nothing in the book that discusses my 
hacking," said Mitnick, who co-authored the book with tech journalist 
William Simon.

Terms of Mitnick's three years of probation  which ends in January  require 
that he keep his hands off all computers, software, modems, cell phones and 
any devices that would give him access to the Internet. His travel and 
employment are also restricted.

Although some of his requests have been denied  especially those relating 
to travel  Mitnick received permission to carry a cell phone, to visit his 
book's New York publicist and to type the manuscript on a computer that is 
not connected to the Internet.

The probation official said the office hadn't been informed of Mitnick's 
plans for a six-city book tour in November, and wasn't sure whether the 
ex-convict would be permitted to travel.

The book's veneer of fiction appears quite thin  except perhaps where it 
veers into boasting. Behind their hokey aliases, the characters sound quite 
like the author.

In one anecdote, Mitnick writes of a hacker who downloads a server's 
encrypted password file and uses a cracking program to perform a 
"brute-force attack." The hacker soon gains the keys to the company network.

In another episode, a rogue caller tricks a company's IT help desk into 
believing he's an employee stuck at home in a snowstorm. The swindle ends 
with the hacker palming a password.

In another, a con man talks a night watchman through the motions of 
creating an account for him on a company computer network. In another, a 
smooth-talking caller dupes an employee into downloading a "Trojan horse" 
program that gives the hacker remote access to the network.

Several of these fictitious scenarios resemble schemes Mitnick confessed to 
when sentenced in 1999, according to court documents provided by the former 
assistant U.S. attorney who prosecuted the case, Christopher Painter.

The confession, signed by Mitnick, describes how the hacker deceived 
operators at dozens of real companies and stole computer source code as 
well as services like phone calls and Internet server space using many of 
the same ruses.

Painter, now deputy chief of the Computer Crime and Intellectual Property 
Section at the U.S. Department of Justice, described Mitnick's tactics as 
closer to those of the old-time con man than of a computer scientist.

Since his release from prison, Mitnick has made a living by using his 
ill-gotten skills as the basis for magazine articles, speaking engagements 
and a recent AM radio talk show in Los Angeles.

Mitnick swears that he'll never hack again  but not because prison taught 
him anything.

"Prison had nothing to do with my rehabilitation," Mitnick said. "I grew 
out of my hacking. Now I'm 38. There are no 38-year-old hackers out there."
 **************************
USA Today
ICANN becomes an exclusive club

BUCHAREST, Romania (Reuters)  The group that oversees the Internet's name 
system voted on Friday to exclude ordinary Web surfers from its board in a 
move that critics say allows mainstream interests to tighten their grip on 
the online world.

ICANN, or the Internet Corporation for Assigned Names and Numbers, 
unanimously passed the resolution at its quarterly meeting, clearing one of 
the most controversial issues in the development of the four-year-old 
organization.

Under a radical new system, the online election of individual Internet 
users to the group's executive board has been abolished.

Instead, the 19-member board of directors will be drawn from 
representatives of technical, business, government and non-profit 
organizations. It will have ultimate say over future policy matters that 
govern the fundamental domain name system for the Internet.

ICANN, a non-profit group, oversees the process of doling out domain names 
with suffixes such as .com to businesses and individuals.

Its chief executive, Stuart Lynn, said the vote was an important step for 
the global body as it would demonstrate to lawmakers that ICANN is 
committed to reform. ICANN has also faced criticism that it is overly 
influenced by American groups.

Some ICANN members questioned the move. Youn Jung Park, a member of the 
non-commercial domain name holders group from South Korea, called the 
decision to exclude the Internet community at large an "unsatisfactory 
development."

"The Internet is supposed to be about people power," she said, 
acknowledging there are problems finding participants to represent an 
Internet community that exceeds 425 million active users globally.

ICANN has also suggested a controversial 25-cent tax on all new domain name 
registrations to boost funding. Critics have called the new funding and the 
abolition of online elections a case of "taxation without representation."

Lynn rejected that criticism, saying individual Net users would be 
represented by a number of board member constituencies, including 
politicians and community groups.

The board also sought to address a criticism that has dogged ICANN since 
its inception in 1998: the perception that American members have a 
disproportionate influence.

"This is a California-based company and most of the staff are from the 
U.S.,"said German board member Andy Mueller-Maguhn. "I don't think that's 
necessarily bad, but I also don't think it represents the cultural 
diversity it should."

ICANN, created to assume control of the Internet's domain name system from 
the U.S. government, has been accused of favoring U.S. business and 
political interests in the past.

Those concerns were re-ignited earlier this month when U.S. lawmakers vowed 
to step up supervision of ICANN before it commits to fully turning over the 
domain name system to ICANN and its international members.

The board said a reformed ICANN would work to include input from the 
lesser-developed Net regions, including Africa and the Middle East.

In a separate vote, ICANN approved the introduction of a 30-day grace 
period, giving current domain name owners extra time to renew their domain 
name contracts to prevent it falling into the hands of speculators.

A separate measure to introduce a waiting list for coveted domain names is 
on track for approval later this summer.
 *****************************
New York Times
FBI Computer Upgrades Will Not Be an Easy Fix
By REUTERS

NEW YORK (Reuters) - When Harold Hendershot joined the FBI two decades ago, 
agents used three-by-five index cards to organize their case information.

The U.S. crime fighting agency has since bought computers, Hendershot 
reassured a crowd of tech enthusiasts at a trade show in New York recently, 
but it's still far from wired.

``The system is broken,'' said Hendershot, chief of the counterintelligence 
computer intrusion unit at the National Infrastructure Protection Center, a 
division of the FBI charged with protecting U.S. infrastructure.

The Federal Bureau of Investigation remains plagued by a lack of basic 
technology the average office worker takes for granted -- the ability to 
search text using more than one term or the ability to run even the 
7-year-old computer operating system Windows 95.

Indeed, FBI Director Robert Mueller has unveiled plans for a massive 
make-over that includes overhauling the way agents share information and 
the technology they use to do it. That move comes as critics question 
whether the FBI and other agencies missed signs that could have warned 
authorities of the Sept. 11 attacks in New York and Washington.that connect 
those agents, the databases that store the information, and the software 
used to comb through the data, analysts say the FBI will be better off.

But if the FBI can solve those cultural and technical issues -- it still 
files some casework on paper -- it may find out that building a modern-day 
information technology network can be just as tricky as busting a terrorist 
network.

SOFTWARE NO PANACEA

Observers say the FBI has to be careful not to make the same missteps of 
some large corporations undertaking similar overhauls -- relying on 
computers to fix problems that have more to do with how the organization 
operates than technology.

``More often than not, management doesn't really understand their own 
processes and they think of software as a panacea, exactly the same way I 
think the government is looking at software as panacea,'' said Josh 
Greenbaum, an independent software analyst in Daly City, California.

The increased focus on the FBI's technology comes amid a slump in the 
technology sector -- when companies that sell computer systems are 
particularly hungry for new business.

The pressure on the FBI to change quickly could cause it to make the kind 
of errors in judgement that companies made during the Internet craze of the 
1990s, Greenbaum warned.

The state of California learned a hard lesson from its deal with Oracle 
Corp. (ORCL.O), the database software maker known for its aggressive sales 
tactics, saying in April it spent $41 million more on software licenses 
than it should have over six years.

Chocolate bar maker Hershey Foods Corp. (HSY.N) and athletic shoe maker 
Nike Inc. (NKE.N) have both in recent years blamed missed earnings and lost 
sales on software that had originally been implemented to make them more 
efficient and save them money.

SCRAPING OFF THE BARNACLES

The FBI's overhaul includes modifying its usually secretive operations so 
that agents share information with each other and with outside groups, such 
as the Central Intelligence Agency or President Bush's proposed Homeland 
Security Department.

FBI's Mueller testified to Congress that in order to collaborate with each 
other and outside agencies, the FBI needs to revamp its database hardware 
and software.

This is no small undertaking.

Data that are now kept on tons of paper or stored in old computers running 
software programs dating back decades needs to be moved to today's 
easy-to-use systems.

At the same time, the FBI has already begun upgrading the computer systems 
in its nearly 500 locations around the world, where some of its 27,000 
employees work on pre-Windows personal computers that connect on a 
low-speed communications network.

``The FBI is a battleship that needs to have its barnacles scraped and its 
hull repainted. It has a very significant need for technology refresh,'' 
said Mike Gibbons, a senior manager at KPMG Consulting who worked at the 
FBI for 15 years and headed the computer investigations unit.

``Not even a year ago they still couldn't run Windows 95 on 13,000 
computers,'' Gibbons said.

MONEY NO OBJECT?

If resources were the FBI's problem in the past, analysts say they aren't 
an issue this year or next year. The FBI's budget for technology has nearly 
tripled to $507 million budgeted for this year, according to Federal 
Sources, a group in McLean, Virginia that tracks government technology 
spending.

For fiscal 2003, the FBI has requested $336 million for spending on 
information technology.

The 2002 number includes some emergency funding that the FBI received 
following the attacks and other monies earmarked for a three-year 
technology upgrade project known as ``Trilogy,'' Federal Sources' Ray 
Bjorklund said.

Trilogy is a several hundred million dollar project that would help field 
offices communicate with each other and headquarters by upgrading PCs to 
machines based on the latest microchips, more powerful server computers, 
and faster networks.

In addition to problems of communicating from field offices to the 
headquarters, FBI whistle-blower Coleen Rowley has told Congress that the 
current FBI database system can't process searches of more than one term -- 
something most simple search engines can do.

``The government is definitely lagging the commercial market in using this 
technology. It's a different situation then back in the Cold War days when 
the government was pushing the latest and greatest technology,'' said Allen 
Shay, president of NCR Government Systems Corp.'s Teradata division, a unit 
of former AT&T unit NCR Corp. (NCR.N).

Shay said the databases the government needs are similar to those of the 
largest corporations, such as Wal-Mart Corp. (WMT.N). The retail giant has 
two machines that store more than 100 terabytes, 100 trillion bytes of 
information -- enough to fill 200 million books.

Hendershot, who manages a 60-terabyte database for the National 
Infrastructure Protection Center (NIPC) that contains information from 
multiple agencies, says the FBI technologists working on the overhaul of 
the case information system may use the NIPC system for ideas.

``They're looking at a lot of what we do,'' Hendershot said.
****************************
BBC
Computers reach one billion mark


One billion personal computers have been sold across the world, according 
to hi-tech consultancy Gartner Dataquest.
And the number of computers is set to explode in the next few years, 
reaching the two billion mark in by 2008.

The greatest growth is expected to be in areas such as China, Latin 
America, eastern Europe and India, predicts Gartner.

"With over half the world's population residing in Asia Pacific, we can 
expect a significant contribution from this region towards the next billion 
PCs sold," said Gartner Dataquest's Ian Bertram.

From chunky to sleek

Computers have come a long way since the launch of the first commercially 
successful and widely available PC, the Altair, in 1975.


Click here to tell us about your first PC

Back then, computers were big and chunky, with simple programs like 
word-processing.

Today, the PC comes in all shapes and sizes and computing power has 
progressed in leaps and bounds.

For many people, they have become a part of everyday life, used to send 
e-mail, browse the internet, edit home movies and play games.

"The PC is so versatile and so good at so many things, it's become 
something that almost everybody has to have," said Gartner Dataquest's 
Martin Reynolds.

Humanising PCs

Nearly half of all the households in western Europe have a PC.

In the UK, a computer can be found in 40% of homes, compared with 13% in 1985.

"Today, humans have to work with computers on the computers' terms," 
explained Intel's Chief Technology Officer, Pat Gelsinger.

"We want to make computers work with humans on their terms. That vision 
includes developing PCs that can recognize speech, gestures and video."
************************
Federal Computer Week
DOD officials push real-time intelligence

Getting the right intelligence information to the warfighters who need it 
as quickly as possible is the key to transforming the Navy and Marine Corps 
and succeeding in the war on terrorism, according to a pair of service leaders.

"The intelligence aspect of this effort has become of the utmost 
importance," said Rear Adm. Joseph Krol Jr., assistant deputy chief of 
Naval Operations for plans, policy and operations, during a June 28 hearing 
of the House of Representatives' Special Oversight Panel on Terrorism. He 
added that sharing intelligence among the armed services and with U.S. 
allies has exposed "seams" that must be addressed.

Krol said that much of the intelligence being collected in Afghanistan in 
caves and from computers there has direct relevance to domestic homeland 
security efforts. "There's loads of intelligence that needs to be shared 
across the many seams because it has an effect on our homeland."

Marine Corps Lt. Gen. Emil Bedard, deputy commandant for plans, policies 
and operations, said that real-time intelligence sharing has improved 
throughout the course of operations in Afghanistan, but there it could 
still be improved.

Bedard said that Operation Enduring Freedom has illustrated the great 
"reach-back" capabilities that technology provides. He used the example of 
an Afghanistan-based Marine commander receiving terrain, landing zone, 
route and the latest enemy situation data from intelligence officials in 
Quantico, Va., in less than four hours.

"Having direct feeds, to the intelligence-gathering platform to the people 
working the mission, we need to get better at that," he said.

Tools like the Air Force's Predator, a vehicle that uses a TV camera, an 
infrared camera and radar for surveillance, reconnaissance and targeting, 
have worked well in Afghanistan, but still do not "go down to the units who 
need it instantaneously," Bedard said. He added that is partially because 
the Marines and other services are still largely working on legacy systems, 
which makes the Defense Department's ongoing transformation efforts of the 
utmost importance.

"The transformation path we're on is critical," Bedard said. "The 
technology and platforms coming are critical."

Krol agreed, and said that includes sharing reconnaissance and other 
necessary information with U.S. allies.

"Speed is where we need to concentrate on," he said. "Our in-theater 
ability to operate with our allies has been successful, but needs to get 
better. We need more plug-and-play situations."

Rep. Jim Saxton (R-N.J.), chairman of the terrorism panel, and ranking 
member Rep. Jim Turner (D-Texas) both expressed concern about the 
military's ability to share information with the intelligence community, 
namely the CIA.

Krol said that the Navy receives information collected by spies 
"eventually, but we're not 100 percent sure what the source is." He added 
that the service works that data into operations when it can, but that 
process takes longer than it should due to the unknown source of the 
information.
 ***************************
Federal Computer Week
Homeland HR plan criticized

The part of President Bush's proposal for the new Homeland Security 
Department that would create a human resources system with broad authority 
to hire, retain and fire employees has drawn the ire of both federal 
employees' unions and members of the House and Senate committees studying 
the proposal. The blueprint for the new department, which Bush delivered to 
Congress June 18, would give the new secretary and the director of the 
Office of Personnel Management authority to create "a modern, flexible and 
responsive [human resources] program."

"Those are absolutely meaningless words," said Jacque Simon, public policy 
director for the American Federation of Government Employees (AFGE). 
"They're just code for taking away the entire merit system that's the basic 
foundation of the civil service. We're going to do everything we can to 
take this part out of this bill."

Not only is the proposal for the human resources program vague, but "when 
we ask [the administration] what they want to do, their response is, 
'Provide the new secretary with maximum flexibility,' which doesn't really 
tell us anything," said Colleen Kelley, national president of the National 
Treasury Employees Union. "We would welcome the opportunity to work with 
them, but we're not going to sign a blank sheet of paper."

Members of the House Government Reform Committee and the Senate 
Governmental Affairs Committee also sharply questioned Office of Homeland 
Security Director Tom Ridge about the human resources part of the proposal 
when he testified at hearings on the new department that both committees 
held June 20.

Senate Governmental Affairs member Daniel Akaka (D-Hawaii) told Ridge that 
he was concerned about the need for "enhanced management flexibility" in 
the bill.

The workforce challenges that the flexibilities are supposed to address are 
not new, and agencies already have the tools to address 90 percent of those 
needs, according to the General Accounting Office comptroller general, 
Akaka said.

Ridge said that the president believes the new secretary needs managerial 
flexibilities to organize the department, reprogram money and transfer people.

Finding intelligence analysts to staff the new department will be a "unique 
challenge," however, Ridge added, because the new agency will be competing 
for analysts with the FBI and CIA. Filling the analyst ranks may require 
hiring retired federal employees and recruiting from the private sector. 
"Giving the [new] department the requested flexibilities will only help 
this effort," he said.

When Rep. Ed Schrock (R-Va.) asked during the House committee hearing about 
how to handle the interoperability problems with the new department's 
information technology, Ridge said that the flexibilities would give the 
new secretary the ability to move both the IT systems and the people who 
would be using those systems.

"The new Cabinet secretary's got a lot of work to do?to improve the 
information flow among and between agencies," he said.

Ridge also said that the proposal doesn't actually mandate a new system but 
simply gives the new secretary the authority to use flexibilities for 
accountability, performance rewards and salaries that will contribute to 
better retention.

AFGE's Simon argued, however, that the proposal clearly states that the 
existing terms and conditions of employment  including pay  that employees 
would bring with them would be maintained only for a transitional period of 
no more than one year.

"Then the clear implication is they would take away the right to collective 
bargaining," she said.

"Nothing this major has happened since the Pendleton Act in 1883," which 
established the Civil Service Commission, Simon added. "This proposal is 
that sweeping."

Diane Frank contributed to this story.

***

Agility is crucial

Office of Homeland Security Director Tom Ridge testified before the House 
Government Reform Committee and the Senate Governmental Affairs Committee 
June 20 that the new Homeland Security Department "must be an agile, 
fast-paced and responsive organization that takes advantage of 21st-century 
technology and management techniques to meet a 21st-century threat."

According to Ridge, those techniques include:

* Great latitude in redeploying resources, both human and financial, "to 
respond to rapidly changing conditions."

* Broad reorganizational authority "to enhance operational effectiveness, 
as needed."

* Significant flexibility in hiring processes, compensation systems and 
practices, and performance management "to recruit, retain and develop a 
motivated, high-performance and accountable workforce."
************************
Government Computer News
FBI gets records management act together

By Patricia Daukantas

The FBI has a new awareness of the importance of records management, the 
assistant director for its new Records Management Division says.

Preventing acts of terror takes a different skill set from the bureau's 
traditional role of catching lawbreakers after the fact, William Hooton 
said last week at the E-Gov conference in Washington. Criminal evidence in 
itself is not an official bureau record, he said, but any analysis of the 
evidence is a record.

For 90 years the bureau had an efficient paper filing system, mostly 
because of longtime director J. Edgar Hoover, Hooton said. Special agents 
used whatever filing approach made them comfortable, such as filing 
cabinets under their desks.

As long as the agents were solving their cases, bureau officials were 
reluctant to force any change, Hooton said. More recently, events combined 
to drive changes, from the post-Sept. 11 need to collaborate with other law 
enforcement agencies to the last-minute discovery of documents related to 
the Timothy McVeigh case, which delayed execution of the convicted Oklahoma 
City bomber for several weeks.

"We basically stumbled on some things we didn't know we had," Hooton said. 
"Congress went ballistic."

Records management is getting strong support from director Robert S. 
Mueller III, Hooton said. The Records Management Division has brought in 
1,000 staff members from other divisions and has become the largest 
division at Washington headquarters. Hooton said Mueller also has 
authorized five new positions at the Senior Executive Service level.
*************************
Government Executive
Senate passes bill to create e-government office
By Maureen Sirhal, CongressDaily

The Senate on Thursday unanimously passed a measure that aims to boost 
initiatives to make government information more accessible online.

The measure is co-sponsored by Sens. Joseph Lieberman of Connecticut and 
Fred Thompson of Tennessee, the chairman and ranking Republican of the 
Governmental Affairs Committee, and Montana Republican Conrad Burns. The 
bill, S. 803, aims to create a systematic approach to managing technology 
in the federal government, both for online services to citizens and in 
using technology to enhance business practices.

The legislation would create an office of electronic government under the 
White House Office of Management and Budget and authorize $345 million for 
the office and its e-government initiatives.

"Today we come a step closer to achieving the important goal of providing 
Americans the same 24-7 access to government information and services that 
is now available to them from the private sector," Lieberman said in a 
statement Thursday.

The proposed e-government office also would act as a clearinghouse for 
related matters, such as security and privacy of federal Web sites and 
online initiatives. It also would call upon federal entities, such as the 
courts, to post certain documents on the Web. And it would establish a fund 
for innovative interagency projects, proposing funding of $45 million in 
fiscal 2003 and increasing to $150 million by fiscal 2006.

"The e-government bill's guiding philosophy is a simple and practical one," 
Burns said in a statement. "The federal government should take advantage of 
the tremendous opportunities offered by information technology to better 
serve its constituents. The passing of this bill is a major milestone 
toward this goal."

In addition, the measure would provide a statutory foundation for the 
federal Chief Information Officers Council, which is composed of various 
agency CIOs. The council would serve as the "principal interagency forum" 
for improving the management of government technology.

The bill also would lift the sunset provisions of the 2000 Government 
Information Security Reform Act, which outlines strategies for protecting 
government computer security and incorporates provisions to address privacy 
concerns and workforce-development issues.

The Center for Democracy and Technology praised the measure, calling it the 
first federal mandate to offer government services via the Internet. The 
measure now heads to the House.
**********************


Lillie Coney
Public Policy Coordinator
U.S. Association for Computing Machinery
Suite 510
2120 L Street, NW
Washington, D.C. 20037
202-478-6124
lillie.coney@xxxxxxx