UN panel touts new global currency reserve system        

A UN panel of expert economists pressed Thursday for a new global currency reserve scheme to replace the volatile, dollar-based system and for coordinated steps by rich countries to stimulate their economies.

"A new Global Reserve System -- what may be viewed as a greatly expanded SDR (Special Drawing Rights), with regular or cyclically adjusted emissions calibrated to the size of reserve accumulations, could contribute to global stability, economic strength and global equity," the panel said.

As part of several recommendations to tackle the global financial crisis, the panel also noted recovery would require all developed countries, in the short term, to take "strong, coordinated and effective actions to stimulate their economies."

And it stressed the need to "lay the basis for the long-run reforms that will be necessary if we are to have a more stable and more prosperous global economy and avoid future global crises."

The commission, led by US economist Joseph Stiglitz, a frequent critic of globalization and unbridled free markets, is primarily aimed at finding solutions for developing countries.

On the monetary front, Stiglitz, the 2001 Nobel economics laureate, told a press conference here there was "a growing consensus that there are problems with the dollar reserve system.

He noted that such a system was "relatively volatile, deflationary, unstable and (had) inequity associated with it."

"Developing countries are lending the United States trillions dollars at almost zero interest rates when they have huge needs themselves," Stiglitz noted. "It's indicative of the nature of the problem. It's a net transfer, in a sense, to the United States, a form of foreign aid."

This week, China's central bank chief Zhou Xiaochuan suggested the dollar could be replaced as a reserve currency by an International Monetary Fund (IMF) basket comprising dollars, euros, sterling and yen, saying it would not be easily influenced by individual countries.

But the UN panel warned that a two (or three) country reserve system "may be equally unstable."

It said a new Global Reserve "is feasible, non-inflationary and could be easily implemented, including in ways which mitigate the difficulties caused by asymmetric adjustment between surplus and deficit countries."

Stiglitz said his panel's experts were currently trying "to lay out the conceptual framework of how this might be done."

The issue of the world currency reserve is expected to be raised at the April 2 summit of the G20 club of developed and emerging economies.

On Wednesday IMF managing director Dominique Strauss-Kahn said that talks on a new global reserve currency to replace the US dollar were "legitimate" and could take place "in the coming months."

But US Treasury Secretary Timothy Geithner earlier defended the dollar as a key global reserve currency.

"I think the dollar remains the world's standard reserve currency, I think that's likely to continue for a long period of time," he said.

Among other recommendations, the Stiglitz panel proposed western aid to help developing nations out of the crisis, better market regulation, a reform of central bank practices and of international financial institutions, as well as the creation of a new structure such as a United Nations economic council.

It specifically called for immediate, additional funding for developing countries "just to offset the imbalances and inequities created by the massive stimulus and bail-out measures introduced by advanced industrialized countries."

It said the funds could come through the issuance of SDRs approved by the IMF board in 1997.

SDRs are an international reserve asset, created by the IMF in 1969 to supplement the existing official reserves of member countries and support the Bretton Woods fixed exchange rate system.

They are allocated to member countries in proportion to their IMF quotas.

I rather like this video.

Pirate Bay four jailed for breaking copyright in Swedish file-sharing trial
The founders of file-sharing website The Pirate Bay have been sentenced to a year in jail in Sweden for breaking copyright laws by helping millions of users download music, movies and computer games for free.

By Rupert Neate
Last Updated: 12:23PM BST 17 Apr 2009

Pirate Bay founders Gottfrid Svartholm Warg, left, and Peter Sunde Photo: AP
Experts believe the ruling could be the first step towards ending illegal downloading, which has cost music and film companies billions of dollars in lost revenue.

Founders Peter Sunde and Gottfrid Svartholm Warg, along with two other employees Fredrik Neij and Carl Lundström, were sentenced to a year in jail after being found guilty in a Swedish court of making 33 copyright-protected files accessible for illegal downloading on the website Piratebay.org.


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Google offers China one million free songsThe four were also ordered to pay $3.6 m (£2.4m) in damages to copyright holders, including Warner Brothers, MGM, Columbia Pictures, 20th Century Fox Films, Sony and Universal, according to Swedish media reports.

In a Twitter posting before sentencing, Mr Sunde said: "Nothing will happen to TPB [the Pirate Bay], this is just theatre for the media."

The Pirate Bay provides a forum for its estimated 22 million users to download content. The site has become the entertainment industry's enemy No. 1 after successful court actions against file-swapping sites such as Grokster and Kazaa.

Defence lawyers had argued the men should be acquitted because The Pirate Bay does not host any copyright-protected material. Instead, it provides a forum for its users to download content through so-called torrent files. The technology allows users to transfer parts of a large file from several different users, increasing download speeds.

But the court found the defendants guilty of helping users commit copyright violations "by providing a website with ... sophisticated search functions, simple download and storage capabilities, and through the tracker linked to the website".

Judge Tomas Norstrom told reporters that the court took into account that the site was "commercially driven" when it made the ruling. The defendants have denied any commercial motives behind the site.

John Kennedy, the head of the International Federation of the Phonographic Industry, said the verdict was "good news for everyone, in Sweden and internationally, who is making a living or a business from creative activity and who needs to know their rights will be protected by law."

Supporters set up a website dedicated to the trial, and the defendants sent updates from the court hearings through social network Twitter.

Forrester Research analyst Mark Mulligan said: “The music industry has come out of this with a ruling that is more positive for them than many had been expected." But he warned that the epidemic of file sharing will continue to grow via instant messaging, email and blogs, as well as file sharing websites.

He said the verdict could have implications for Google, as it provides links to illegal content.

Dawn Osborne, copyright lawyer at intellectual property firm Rouse, said: “Pirate Bay have been thumbing their nose at the establishment for too long and the view of many content owners will be that they have finally got what they deserved.

“Copyright protection is crucial to ensuring that creativity and innovation continue and much needed economic prosperity returns. The case shows that breach of these rights potentially has very serious consequences.”

Landmark study: DRM truly does make pirates out of us all
By Nate Anderson | Last updated May 27, 2009 8:46 PM CT

A UK researcher has spent years interviewing people about whether DRM has affected their ability to use content in ways ordinarily protected by the law. Surprise! It has, even leading one sight-impaired woman to piracy.



It's a well-known story by now: Europe, the US, and plenty of other countries have made it generally illegal to circumvent DRM, even when users want to do something legal with the content. Sure, it sounds bad and Ars complains about it all the time, but come on—do anticircumvention laws really prevent real people in the real world from doing real things with their content? Or are the complaints largely dreamed up by copyleft activists who would like nothing more than to see the term "intellectual property" disappear into the tentacled maw of Cthulhu?

According to the first empirical study of its kind in the UK, by Cambridge law professor Patricia Akester, it's the former. DRM is so rage-inducing, even to ordinary, legal users of content, that it can even drive the blind to download illegal electronic Bibles.
Problems, problems everywhere

Akester's new paper, "Technological accommodation of conflicts between freedom of expression and DRM: the first empirical assessment," does pretty much what its title implies. Akester spent the last few years interviewing dozens of lecturers, end users, government officials, rightsholders, and DRM developers to find how DRM and anticircumvention laws affected actual use.

Problems were not hard to find. When Akester spoke with the UK's Royal National Institute of Blind People, Head of Accessibility Richard Orme told her that those with sight problem have the right "to create accessible copies of works" by using screen reading software, for instance, but these rights can be blocked be restrictive e-book DRM.

    Analog "equivalents" aren't often equivalent in any meaningful sense of the word

"The RNIB is very watchful of the issues around DRM," said Orme, "because it can see evidence of DRM preventing access to content in a world where digital technology actually makes information more accessible rather than less."

As an example, take the case of Lynn Holdsworth, who bought an electronic copy of the Bible from Amazon. It refused to allow text-to-speech, which Holdsworth required. She contacted Amazon, which has a policy of not refunding e-books after a successful download.

"On Amazon’s advice, Lynn Holdsworth contacted the publisher, but the publisher referred her back to Amazon," writes Akester. "Neither Amazon nor the publisher were able to assist her and she ended up obtaining an illegal copy of the work (which her screen reader application could access)."

Rightsholders will always point out that fair use and other exemptions to copyright don't necessarily allow access to any format the user wants. Professors who need film clips can just camcord off the screen! The blind can use Braille versions!

But analog "equivalents" aren't often equivalent in any meaningful sense of the word. Holdsworth noted that "it is not always possible to resort to non-digital [books] because of their size. She supplied an example: the standard version of Harry Potter and the Half Blood Prince contains about 600 pages, the large print version is only slightly bigger (at 998 pages), but the Braille version actually entails ten large volumes of text."
Libraries and lecturers

    The British Library runs into issues with DRM on a daily basis—especially when it needs to transfer materials to new formats for storage or preservation.

Everybody that Akester spoke with had some problem of their own. Film lecturers, who are allowed to put together clip compilations under UK law, still can't (legally) bypass the CSS encryption on DVDs.

Lecturers who don't know how to bypass the DRM are faced with an unappealing choice: those "unable to extract a clip from a commercial DVD lodged in their library collection are forced to tailor the content of their lectures to the VHS materials at their disposal. They contend that this happens frequently, given that most commercial DVDs are DRM protected."

End users are allowed to time-shift programs, but Jill Johnstone of the National Consumer Council notes that "the way DRM is being used is causing serious problems for consumers, including unreasonable limitations on the use of digital products and infringement of consumer rights. "

And the British Library runs into issues with DRM on a daily basis—especially when it needs to transfer materials to new formats for storage or preservation.

Akester interviewed Ars Technica's own Peter Bright, a British Library specialist on digital archiving, who pointed out just how ridiculous the whole situation has become, especially involving DVDs. "For these duplicates and migrations to be useful, the DRM protection must necessarily be defeated. The reality is that this is generally easy to do—for all the time and money spent on trying to protect optical discs, software workarounds are cheap, abundant and fairly reliable.”
Edge cases

To DRM developers and rightsholders, though, these are just edge cases, not worth coding into DRM schemes. Creating DRM that has any sort of security while still accommodating every legal use in every possible market is simply infeasible—though this does lead rightsholders to question the wisdom of DRM.

Shira Perlmutter of global music trade group IFPI told Akester in an interview, "You are not going to get a one size fits all DRM that will deal both with the consumer and the special interests exceptions and, in any case, you do not want to give up a system that works for 99 percent of cases because there is a particular issue with a particular kind of user when you can let the system work and then deal with that user."

Are rightsholders willing to "deal with users" who experience problems? Some are, but Akester found that many require a legislative prod before taking any action.

The study confirms what anyone who has ever wanted to rip a DVD to their computer or iPod could have told you: DRM, coupled with anticircumvention laws, makes pirates of us all.

Akester offers some possible solutions to the problem. They are worth reading, but they are also unlikely to be implemented for years. In the meantime, copyright exceptions for the blind, libraries, teachers, and for fair use will continue to be limited by a crafty mixture of code and law.

Of course, as Bright points out, the massive lobbying, legislative, legal, and technical effort that underlies all these DRM regimes does so little to stop piracy that we'd be tempted to laugh at the folly of it all if we weren't already weeping.