|iPhone's Next Generation Found in a Bar|
Silicon Valley cops raid Gizmodo editor's home, take four computers
Mon Apr 26, 8:58 pm ET
Police broke into the home of Gizmodo editor Jason Chen and confiscated four computers and two servers, the tech blog reports. Gizmodo broke the news last week about Apple 's next-generation iPhone, after paying a source who found it in a California bar $5,000 for the device.
The officers were from the Rapid Enforcement Allied Computer Team (REACT), a California law enforcement group based in Silicon Valley . In the search warrant, which Gizmodo posted, REACT officers checked a box indicating that they were looking for property "used as a means of committing a felony."
Since the Gizmodo iPhone scoop broke last week, some have speculated that Gizmodo and its parent company, Gawker Media , might be liable for criminal prosecution for being in receipt of stolen goods under California law.
Gawker has blasted back at the police with seized-property charges of its own, claiming that the police had no legal grounds for seizing a journalist's property. Gaby Darbyshire, Gawker's chief operating officer , wrote to the police that Chen "tells me that he showed you an email I had sent him earlier that day that told him that he should tell you that under both state and federal law, a search warrant may not be validly issued to confiscate the property of a journalist."
In a ruling handed down last week, a New Jersey court determined that a blogger being sued for defamation did not have full standing as a journalist and therefore was not protected under the state's "shield law," which protects journalists from being compelled to take part in court proceedings pertaining to their work. California has a shield law, but there is no shield law that covers federal criminal cases.
In her letter, Darbyshire further explained that Chen "tells me that you ignored him and, having been inside for a few hours already, you proceeded to remove the materials despite his protestations."
Chen said that REACT did not damage his other property — apart, that is, from bashing in his door to get inside while he wasn't home.
— Michael Calderone is the media writer for Yahoo! News.
What is Apple Inc.'s role in task force investigating iPhone case?
Mon Apr 26, 8:09 pm ET
The California criminal investigation into the case of the errant Apple G4 iPhone that Gizmodo.com unveiled before legions of curious Internet readers last week is noteworthy in its potential to make new media law. But it's also striking for another reason: The raid that San Mateo area cops conducted last week on the house of Gizmodo editor Jason Chen came at the behest of a special multi-agency task force that was commissioned to work with the computer industry to tackle high-tech crimes. And Apple Inc . sits on the task force's steering committee.
On Friday, members of the Rapid Enforcement Allied Computer Team (REACT) Task Force entered Chen's home and seized four computers and two servers as evidence in a felony investigation. REACT is a partnership of 17 local, state, and federal law-enforcement agencies headquartered in Santa Clara County , founded in 1997 to address "new types of crime directly tied to [California's] increasingly computer-oriented economy and widespread use of the Internet," according to the task force's website .
The idea was to bring a variety of business interests and police agencies together to help combat identity theft , computer fraud, and the like. The team's website explains that "high tech companies ... provide specialized training, liaison personnel and internal support for task force investigations."
What's curious is that one of those high-tech companies providing training, personnel, and support to the task force is Apple Inc., the alleged victim in the Gizmodo case. According to this May 2009 story from the San Jose Business Journal , Apple is one of the 25 companies that sit on REACT's "steering committee." Which raises the question as to whether Apple , which was outraged enough about Gizmodo's $5,000 purchase of the lost iPhone for CEO Steve Jobs to reportedly call Gawker Media owner Nick Denton to demand its return , sicked its high-tech cops on Chen.
Gizmodo says it paid $5,00 for the prototype 4G iPhone from someone who found it sitting untended on a bar stool in a Silicon Valley beer garden. Stephen Wagstaffe, the chief deputy district attorney in the San Mateo District Attorney's office, told Yahoo! News that the search warrant on Chen's home was executed by members of the REACT Task Force in the course of investigating a "possible theft," but he didn't say whether the target was Gizmodo or the anonymous tipster who found the phone. In either case, it's hard to imagine — even if you grant that a theft may have occurred under California law , which requires people who come across lost items to make a good-faith effort to return them to their owner — how the loss of a single phone in a bar merits the involvement of an elite task force of local, state, and federal authorities devoted to "reducing the incidence of high technology crime through the apprehension of the professional organizers of large-scale criminal activities ," as the REACT website motto characterizes its mission.
"It depends," Wagstaffe says. "If there's something unusual about the phone, then yes, REACT would get involved. It deals with anything that's high-tech. So if it's hard to put a value on it — for instance, if it's not just any cell phone — then a local police force might have trouble assessing its value, and the task force would have the expertise to do that." By calling its steering committee member Apple , perhaps?
"That's a good question," Wagstaffe says. "I don't know if Apple is on the steering committee."
He referred us to another REACT spokeswoman. We asked her to confirm Apple's presence on the committee and to explain what, precisely, the committee does and how it relates to the task force's law enforcement efforts . She hasn't gotten back to us.
According to the San Jose Business Journal , other steering committee members include Cisco Systems, Microsoft , and Adobe . This isn't the first criminal investigation REACT has conducted in which a steering-committee member was a victim: In 2006, REACT broke up a counterfeiting ring that was selling pirated copies of Norton Antivirus, which is produced by steering-committee member Symantec. REACT has also launched piracy investigations in response to requests from Microsoft and Adobe.
Apple did not return phone calls seeking comment.
— John Cook is a senior national reporter/blogger for Yahoo! News.
7 Reasons Apple Shareholders Should Be Cautious
by Brett Arends, Friday, April 23, 2010
provided by : THE WALL STREET JOURNAL
Apple (NYSE: AAPL - News ) investors could be excused for feeling on top of the world. Another blowout quarter has sent the stock booming to another all-time high. The iPad seems to be a success. Everything the company touches seems to turn to gold.
Savor the moment, by all means. But don't get complacent. If you're an Apple shareholder, here are seven things to be concerned about—and one thing you can do about it.
1. Apple's good — but not that good. It's just that the competition is so bad. Nokia (NYSE: NOK - News ), Microsoft (NasdaqGS: MSFT - News ), Samsung, Palm (NasdaqGS: PALM - News ): From smartphones to Internet tablets to computers, it's hard to believe so many big companies have blown it so badly. And they've committed mainly unforced errors, such as terrible user interfaces. I bought a non-iPod MP3 player the other day. It's great ... except making playlists is nearly impossible.
As long as the competition acts like this, Apple will keep winning. But its success owes less to the genius of Apple than the incompetence of everyone else. And that's something you can't control.
2. Apple fatigue. Was anything so ridiculous as the coverage of the new iPad? A computer company launched a new computer. Time and Newsweek put it on the cover, for heaven's sake, complete with fawning copy from the likes of Stephen Fry. A lot of people are getting absolutely fed up with this circus. Fashions come, but fashions go. Is Apple becoming overexposed? Right now Steve Jobs could sell his old underwear for $200 a pair (the "iPants"), and the sheep would line up at your local Apple store. If this mania lasts, it will be a first in human history.
3. The share price. At $260, Apple's stock price has more than doubled in a year. Amateur investors say, "It's going up." Present tense. Serious investors say, more accurately: "It has gone up." Past tense. No one knows the future. And the more it rises, the less attractive it gets. It's now 20 times annual cash flow and 5 and a half times annual sales. At $235 billion, the company is being valued at more than Sony (NYSE: SNE - News ), Research In Motion (NasdaqGS: RIMM - News ), Dell (NasdaqGS: DELL - News ), Motorola (NYSE: MOT - News ), Nokia, HTC (Taiwan 2498.TW - News ), SanDisk (NasdaqGS: SNDK - News ) and Palm ... put together. That assumes a lot.
4. Steve Jobs's ego. I don't care how much of a genius he is: Nobody is perfect. Yet Mr. Jobs has been subject to extravagant cheerleading, and it's not as if he was overendowed with a sense of humility to begin with. Bottom line: If and when he makes mistakes, who is going to stop him? A small but telling example: One thing keeping Apple from lots of extra iPhone sales to business users is that Mr. Jobs, for some reason, has a thing against keyboards. There's no business reason for it. It's a silly, unforced error.
5. The cellular networks. At what point will they stop giving away the store? Right now they're paying most of the cost of each new iPhone, and under-charging for the data plans too. That's great for customers and great for Apple, and bad for the networks. The iPhone is an expensive data hog that soaks up airtime, and there's always a risk the networks will start playing tougher. Verizon, which lost out to AT&T three years ago for the right to carry the iPhone in the US, doesn't seem to be suffering as a result. Its investors have done no worse than those of AT&T. And its data traffic just jumped 20%, even without the Apple phone.
6. Apple backlash. As the competition forfeits game after game, Apple is starting to dominate industries from cell phones and games to music and media. Now it looks like it wants to dominate ebooks too. But if Ken Auletta's account in the latest New Yorker is correct, Apple's game plan to defeat Amazon means teaming up with book publishers—and that may mean higher book prices for consumers. How will consumers react? And what will that do for Apple's "friendly," rebel image? Anyway, you can't play the underdog when you're the third-biggest company in the world by market value. Apple is already worth more than General Electric (NYSE: GE - News ), Wal-Mart (NYSE: WMT - News ), Chevron (NYSE: CVX - News ) or Procter & Gamble (NYSE: PG - News ). It is worth nearly as much as Microsoft. At some point it starts to look like the Big Brother it once vilified . It may even look like the new Microsoft.
7. Steve Jobs's health. This is the "ick" issue. But Apple cheerleaders can't have it both ways. They can't hail Steve Jobs as a visionary genius and the world's greatest CEO, and then say it's none of shareholders' business whether he will still be running the company in three years' time. It's only a year since he had a liver transplant, and investors can hardly feel confident they got all the relevant information clearly and early. We all hope Mr. Jobs enjoys the best of health and lives to a ripe old age. But he still looks worryingly thin. This is something for investors to keep an eye on.
Some of these are issues that could erupt into problems quickly. Others, if they do emerge, would take more time. But if you're a nervous Apple investor, what are your alternatives? Sure you could sell some stock and take your profits. But if you don't want to get off this train quite yet, here's another idea: You could buy some insurance using "put" options. These pay out if the stock falls. So for $19 you can buy $200 puts, good until January 2012. These will limit your downside on the stock to $200. But if Apple keeps booming upwards, all you can lose is the $19.
Write to Brett Arends at firstname.lastname@example.org
IPhone App to Sidestep AT&T
by David Pogue
Thursday, March 25, 2010
For a little $1 iPhone app, Line2 sure has the potential to shake up an entire industry.
It can save you money. It can make calls where AT&T 's ( T ) signal is weak, like indoors. It can turn an iPod Touch into a full-blown cellphone.
And it can ruin the sleep of cellphone executives everywhere.
Line2 gives your iPhone a second phone number -- a second phone line, complete with its own contacts list, voice mail, and so on. The company behind it, Toktumi (get it?), imagines that you'll distribute the Line2 number to business contacts, and your regular iPhone number to friends and family. Your second line can be an 800 number, if you wish, or you can transfer an existing number.
To that end, Toktumi offers, on its Web site, a raft of Google ( GOOG ) Voice-ish features that are intended to help a small businesses look bigger: call screening, Do Not Disturb hours and voice mail messages sent to you as e-mail. You can create an "automated attendant" -- "Press 1 for sales," "Press 2 for accounting," and so on -- that routes incoming calls to other phone numbers. Or, if you're pretending to be a bigger business than you are, route them all to yourself.
The Line2 app is a carbon copy, a visual clone, of the iPhone's own phone software. The dialing pad, your iPhone Contacts list, your recent calls list and visual voice mail all look just like the iPhone's.
(Let's pause for a moment here to blink, dumbfounded, at that point. Apple 's ( AAPL ) rules prohibit App Store programs that look or work too much like the iPhone's own built-in apps. For example, Apple rejected the Google Voice app because, as Apple explained to the Federal Communications Commission, it works "by replacing the iPhone's core mobile telephone functionality and Apple user interface with its own user interface for telephone calls." That is exactly what Line2 does. Oh well -- the Jobs works in mysterious ways.)
So you have a second line on your iPhone. But that's not the best part.
Line2 also turns the iPhone into a dual-mode phone. That is, it can make and receive calls either using either the AT&T airwaves as usual, or -- now this is the best part -- over the Internet. Any time you're in a wireless hot spot, Line2 places its calls over Wi-Fi instead of AT&T's network.
That's a game-changer. Where, after all, is cellphone reception generally the worst? Right -- indoors. In your house or your office building, precisely where you have Wi-Fi. Line2 in Wi-Fi means rock-solid, confident reception indoors.
Line2 also runs on the iPod Touch. When you're in a Wi-Fi hot spot, your Touch is now a full-blown cellphone, and you don't owe AT&T a penny.
But wait, there's more.
Turns out Wi-Fi calls don't use up any AT&T minutes. You can talk all day long, without ever worrying about going over your monthly allotment of minutes. Wi-Fi calls are free forever.
Well, not quite free; Line2 service costs $15 a month (after a 30-day free trial).
But here's one of those cases where spending more could save you money. If you're in a Wi-Fi hot spot most of the time (at work, for example), that's an awful lot of calling you can do in Wi-Fi -- probably enough to downgrade your AT&T plan to one that gives you fewer minutes. If you're on the 900-minute or unlimited plan ($90 or $100 a month), for example, you might be able to get away with the 450-minute plan ($70). Even with Line2's fee, you're saving $5 or $15 a month.
Line2 also lets you call overseas phone numbers for Skype-like rates: 2 to 5 cents a minute to most countries. (A full table of rates is available at toktumi.com.) As a handy globetrotters' bonus, calls home to numbers in the United States from overseas hot spots are free.
All of these benefits come to you when you're in a Wi-Fi hot spot, because your calls are carried by the Internet instead of by AT&T. Interestingly enough, though, Line2 can also make Internet calls even when you're not in a hot spot.
It can, at your option, place calls over AT&T's 3G data network, where it's available. Every iPhone plan includes unlimited use of this 3G network -- it's how your iPhone sends e-mail and surfs the Web. So once again, Line2 calls don't use up any of your monthly voice minutes.
Unfortunately, voice connections on the 3G network aren't as strong and reliable as the voice or Wi-Fi methods. Cellular data networks aren't made for seamless handoffs from cell tower to tower as you drive, for example -- there's not much need for it if you're just doing e-mail and Web -- so dropped calls are more likely. Fortunately, if you're on a 3G data-network call and you walk into a hot spot, Line2 switches to the more reliable Wi-Fi network seamlessly, in midcall.
Whenever you do have an Internet connection -- either Wi-Fi or a strong 3G area -- you're in for a startling treat. If you and your calling partner are both Line2 subscribers, Line2 kicks you into superhigh audio-quality mode (16-bit mode, as the techies call it).
Your calling partners sound as if they're speaking right into the mike at an FM radio station. It's almost too clear; you hear the other person's breathing, lip smacks, clothing rustling and so on. After years of suffering through awful cellphone audio, it's quite a revelation to hear what you've been missing.
Now, this all sounds wonderful, and Line2 generally is wonderful. But there's room for improvement.
First, as you've no doubt already concluded, understanding Line2 is complicated. You have three different ways to make calls, each with pros and cons.
You miss a certain degree of refinement, too. The dialing pad doesn't make touch-tone sounds as you tap the keys. There's no Favorites list within the Line2 app. You can't get or send text messages on your Line2 line. (The company says it will fix all this soon.)
There's a faint hiss on Line2 calls, as if you're on a long-distance call in 1970. The company says that it deliberately introduces this "comfort noise" to reassure you that you're still connected, but it's unnecessary. And sometimes there's a voice delay of a half-second or so (of course, you sometimes get that on regular cellphone calls, too).
Finally, a note about incoming calls. If the Line2 app is open at the time, you're connected via Wi-Fi, if available. If it's not running, the call comes in through AT&T, so you lose the benefits of Wi-Fi calling. In short, until Apple blesses the iPhone with multitasking software, you have to leave Line2 open whenever you put the phone to sleep. That's awkward.
Still, Line2 is the first app that can receive incoming calls via either Wi-Fi or cellular voice, so you get the call even if the app isn't running. That's one of several advantages that distinguish it from other voice-over-Internet apps like Skype and TruPhone.
Another example: If you're on a Wi-Fi call using those other programs, and someone calls your regular iPhone number, your first call is unceremoniously disconnected. Line2, on the other hand, offers you the chance to decline the incoming call without losing your Wi-Fi call.
Those rival apps also lack Line2's call-management features, visual voice mail and conference calling with up to 20 other people. And Line2 is the only app that gives you a choice of call methods for incoming and outgoing calls.
All of this should rattle cell industry executives, because let's face it: the Internet tends to make things free. Cell carriers go through life hoping nobody notices the cellephant in the room: that once everybody starts making free calls over the Internet, it's Game Over for the dollars-for-minutes model.
Line2, however, brings us one big step closer to that very future. It's going to be a wild ride.
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