[Reader-list] a strange story on IP

[Ravi Sundaram]

One battle the RIAA is not winning

Techno-Rebels in West Bank?
File Swapping Firm Claims Odd Hide-Out
By John Ward Anderson
Washington Post Foreign Service
Sunday, February 22, 2004; Page A29

JENIN, West Bank -- Somewhere in this beleaguered town, Palestinian 
computer whizzes from a company called Earth Station V have launched a 
high-tech assault on the U.S. entertainment industry, with a defiant 
message for those trying to stop the downloading of music and movies: 
"Resistance is futile."

That, at least, is what the company wants people to believe, and it has 
cooked up an elaborate ruse that has made Earth Station V and its claim to 
hide downloaders' identities the buzz of the moment in the online universe.

But seemingly no one in this town of 34,000 -- the scene of some of the 
heaviest fighting in the three-year-old Israeli-Palestinian conflict -- has 
heard of Earth Station V. Computer salesmen and technicians, Internet 
providers, Internet cafe workers and customers and community and 
Palestinian militant leaders said they knew of no one who works for the 
company. Questions about its founder and president, who calls himself Ras 
Kabir -- Arabic for "Big Head" -- drew laughter.

Yet someone has gone to enormous trouble and expense to create complicated 
software programs and a sophisticated Web site that offers X-rated movies, 
long-distance calling, a dating service, the downloading of music, 
first-run movies and computer software -- all free and all supposedly 
augmented with stealth technology that hides a user's identity. And all 
with no advertisements or other visible means of generating revenue, 
despite monthly operating costs that the company says amount to $1.5 million.

In recent years, downloading music has become one of the biggest and most 
controversial activities on the Internet -- one that many computer experts 
say could transform the U.S. entertainment industry. Even if laws could be 
written fast enough to keep up with changing technology, experts say, 
online file swapping and downloading are virtually unstoppable.

With entertainment industry agencies -- particularly the Recording Industry 
Association of America (RIAA) -- using tough U.S. laws to shut down other 
Internet platforms used for copying music, most Web sites that specialize 
in music downloads have gone low-profile. But Earth Station V is openly 
rallying people to engage in digital music and movie swapping. Its 
operators have crafted a finely honed bad-boy image that seems to taunt 
officials to discover who they are and to catch 'em if they can.

The company claims to have its headquarters in the West Bank and Gaza Strip 
to take advantage of loose Palestinian copyright and intellectual property 
laws that it says can keep U.S. legal hounds at bay.

No Paper Trail

The real boon for Earth Station V, however, seems to be the publicity 
bonanza that comes from claiming that such a cutting-edge Internet company 
is being run by a multiethnic band of techno-rebels in besieged and 
impoverished Palestinian refugee camps.
But the company's business and Internet paper trails don't support that 
claim. The West Bank and Gaza addresses the company lists for its offices 
don't exist, the telephone numbers don't answer, company officials refuse 
to meet with reporters and they communicate only by e-mails and call-backs. 
Reporters are not allowed to visit Earth Station V offices or talk to workers.

In several telephone interviews, a spokesman for Earth Station V, Steve 
Taylor, said the company has about 100 employees in the West Bank and Gaza 
Strip. But he declined a reporter's request to visit their work sites, 
saying that Palestinian militant groups did not approve of Earth Station 
V's activities -- particularly its broadcast of pornographic movies -- and 
were threatening the company's operations and employees. Militants also 
were angry, he claimed, that the company had Jewish partners.

Computer sleuths have traced some of Earth Station V's Internet providers 
to Israel; computer experts agree that from there, the service could be 
routed into the Palestinian territories. But even if that is the case, 
experts agree, the electronic veil offered by the Internet is so 
impermeable that the company's employees could be sitting at desks almost 
anywhere in the world, while using the West Bank as their electronic address.

"They are making it very difficult for anyone to find who they are, where 
they are and how they operate," said Ghassan Anabtawi, marketing director 
for Paltel, the monopoly telephone company in the Palestinian territories. 
Paltel has no record of providing voice or Internet service to Earth 
Station V. "It's something fishy and weird -- they are very professional in 
conning people," Anabtawi said.
The company might be receiving Internet service from a Palestinian 
provider, he said, but none had claimed it as a client.
In addition to Jenin and Gaza, said Taylor, the Earth Station V spokesman, 
the company has offices in the West Bank towns of Ramallah, Nablus and 
Bethlehem. Computer specialists in each town said they were not familiar 
with Earth Station V.

"I've never heard of the company, and I should have heard of it," said 
Yahya Salqan, general secretary of the Palestinian Information Technology 
Association. He said he sent e-mails to the 75 members of his association 
asking if any knew of Earth Station V, and "nobody had."

Business registration papers filed with the Palestinian Authority in 
Ramallah and other company documents reviewed by The Washington Post list 
an Internet pornography king, Stephen Michael Cohen, as the "sole director" 
of Earth Station V. Taylor said Cohen was a "consultant" who "brings a lot 
to the table because of his expertise."

Cohen has been listed as a fugitive from the United States since 2001 for 
failing to appear in a court case in which he was ordered to pay $65 
million in damages for stealing the Internet domain sex.com. According to 
the judgment, in 1995 Cohen forged a letter by the real owner of sex.com 
instructing the agency that registered domains to transfer ownership to 
him. Cohen controlled the domain name for five years, building sex.com into 
what reportedly was one of world's most visited and profitable Web sites.
Taylor said Earth Station V had about $1.5 million per month in operating 
costs but no revenues. He said the company's investors, whom he declined to 
name, were willing to lose money in the short term to attract users but 
planned to add potentially huge money-making ventures to the Web site in 
the near future, including online auctioning and gambling.
A Widespread Practice

But its biggest draw is offering a platform for Internet users to download 
music, a practice that has become so widespread that many experts expect it 
to revolutionize the relationship between Americans and the performing 
arts. Internet experts estimate that 60 million Americans swap files 
online. A report in August by the Internet technology firm Forrester 
Research found that 49 percent of 12- to 22-year-olds had downloaded music 
in the previous month.
In September, the RIAA filed lawsuits against 261 people for copying music 
over the Internet, saying the practice violated U.S. copyright laws. 
According to the RIAA, about 2.6 billion copyrighted files, mostly songs, 
are downloaded over the Internet per month, which the organization says is 
the leading cause of the worldwide decline in music industry sales from $40 
billion in 2000 to $26 billion in 2002.
Marc Andreessen, who helped create the Netscape Web browser and is 
considered one of the fathers of the Internet, said at a conference in Palm 
Beach in November that Earth Station V and file-sharing companies like it 
were on the verge of making the downloading of music and other intellectual 
property virtually unstoppable, no matter the law.

Such predictions hinge on whether Earth Station V really has found a way 
for users to conduct online music swapping with impunity. Computer experts 
and music industry officials scoff at the company's claim that it can hide 
the identities of the site's users.
"It's a sophisticated protocol, but it's not set up for all the claims they 
make," said Mark Ishikawa, the head of BayTSP, an Internet security company 
that investigates piracy for record companies and other high-tech 
industries. "We looked at them, and the people who were downloading files 
were not anonymous."
"We can easily target infringers on their network," said Matt Oppenheim, 
senior vice president of the RIAA. He said Earth Station V "was throwing 
stones at us because that's how they get more press and grow their pirate 
network."

'At War' With Associations

Taylor, the company spokesman, said Earth Station V has roughly 710 
employees in several countries, including Russia. Their software is 
available in 28 languages, he said, although the Web site listed only about 
15, and none was Arabic, the language spoken by Palestinians.
Business registration documents filed in June with the Palestinian Economy 
Ministry said Earth Station V had $2.75 million in start-up capital and was 
established to conduct "transactions in financial documents." The papers 
listed Rony Hanouna, the owner of several cellular telephone stores in the 
West Bank, as the company's representative in the West Bank town of Bethlehem.
Hanouna said in an interview that he had no knowledge of Earth Station V's 
activities and expressed surprise that the company was conducting business, 
saying that as far as he knew, it existed only on paper.
Hanouna said he was approached by several people about 10 months ago and 
asked to open an office for Earth Station V. But after filling out the 
paperwork, Hanouna said, he never heard back from the people.
Initially, much of the publicity about the Earth Station V Web site came 
from company statements distributed by PR Newswire, a public relations 
firm. In one such statement, Earth Station V declared it was "at war" with 
the RIAA and the Motion Picture Association of America (MPAA), asserting 
that "resistance is futile and we are in control now."
The Earth Station V Web site asserts that the RIAA and MPAA "have 
absolutely no jurisdiction" over the company because "Palestine is not a 
signee of the Intellectual Property Agreements."
"In other words, the RIAA uses local laws of Western countries to hurt 
people," the Web site says. "In contrast, ES5 uses local laws of Palestine 
to help people."
"That is an outrageous statement," said Hiba Husseini, a Palestinian 
attorney who is helping draft new intellectual property laws for the 
Palestinian Authority. While current laws are about 50 years old and do not 
specifically address issues of using computers and the Internet to violate 
copyrights, she said, the Palestinian ministers of culture and economy can 
and have issued administrative rules and regulations to combat copyright 
violations and piracy.
"The ministries can by directives or orders shut an operation of this 
nature down, if they get an official complaint," she said.