Digital Wage

What a difference a year makes, to the country, and to the New Economy

Companies that had bet their future on leveraging the Web's ability to closely monitor users' behavior are either failing or have failed. And to the extent there is one, the privacy debate has moved to Washington and new civil-liberties-bashing anti-terrorist legislation: The government, it appears, may be the one doing the electronic spying.


In September 2000, electronic books -- small devices with screens that can display the text to novels and other digitized volumes -- were heralded as the greatest thing since Gutenberg's press. Companies such as Adobe had once promised a future where vacationers read electronic books on the beach and electronic magazines in the bathroom. A year ago e-books were going to change the nature of books. (That was before Stephen King, the e-book movement's erstwhile champion, abandoned his second electronic book late last year.)

But the act of copying electronic files -- an activity that had become as natural as breathing to users of the Internet -- had book and movie distributors trembling in the face of "peer-to-peer" file-sharing technology popularized by Napster. The key to the success of books composed of electrons, it was then said, lay in punishing those who would copy the works without permission, and hence without compensation to the creators and publishers of the works.

Along with record labels and movie houses, book publishers had a weapon: the Digital Millennium Copyright Act, a controversial 1998 law that Congress passed to protect holders of intellectual property in the Internet age. The law makes it a crime to circumvent copyright protection systems. "Copyright law was originally designed to create a public domain of ideas. It provides an economic incentive to authors as a means of providing this vibrant public domain. So far the Digital Millennium Copyright Act hasn't been used for copyright infringement," said Robin Gross, staff attorney for the Electronic Frontiers Foundation, a digital advocacy group. "Instead, lawful speech has been curtailed. Scientists all over the world saying they're afraid to travel here because they've made a copy of something or written a paper that could be subject to Digital Millennium Copyright prosecutions."

A year later, the e-book companies have delivered neither readers nor authors, unless you count Dmitry Sklyarov, a terrified 26-year-old Russian software writer who is now under virtual house arrest in San Mateo. Sklyarov awaits trial for his "crime" of writing something called Advanced eBook Processor, a computer program sold by his Russian employer, ElcomSoft, that allows purchasers of Adobe e-books to make backup copies for themselves. Adobe swiftly retracted its complaint in the face of public outcry, but the U.S. Attorney's Office proceeded with prosecution just the same.

Sklyarov is now out on $50,000 bail and is not allowed to leave Northern California, his attorney told me.

"I don't want to be a celebrity at all," said a pale, retiring Sklyarov when I spoke with him last week. "I just want to go home."


A year ago there still existed meager hope that the Web would change everything in the information business. Amateur Web journalists and Webloggers would keep people more informed than they had ever been. Entrepreneurs would figure out some way to make surfers pay for what they saw, and entrepreneurs would somehow make money. Those still practicing in the "old journalism" would soon be roadkill.

Last week a panel made up of both "Web journalists" and traditional news editors discussed the Web's role in covering the World Trade Center attack. It became immediately evident that the independent Web amateurs knew nothing of journalistic methods, the trained pros who started their careers in the print and television worlds were -- well -- trained and professionals, and the world would remain the same as it always had: As a news medium, the Web would be most effective as a way to distribute traditional journalists' output.

For years tech seers talked about how the World Wide Web would steamroll ordinary media. The newspapers, television networks, and other news organizations that sent experienced reporters to foreign lands to gather news would become defunct now that surfers could log onto amateur Web sites originating around the world. A Seybold panel effectively debunked this idea within minutes. Rather than brag about how the Internet might make military censorship impossible in a wired-together age, Web journalists defended their ability to adequately censor themselves.

The panel's moderator, Dave Winer, host of Scripting News, a Weblog, had been quoted in Wired News as saying, "The Web has a lot more people to cover a story." The following week at Seybold he revealed he was unfamiliar with ordinary journalistic conventions such as reporting a story before going to press. "But wouldn't that [time spent reporting] mean a competitor might go with the story before you?" he asked a panelist.

The Web was indeed full of firsthand man-in-the-street accounts from New Yorkers near the blast during the second week of September. But it was newspapers, not Webloggers, that were breaking all the important stories.

Meanwhile, Web experts seem to have given up on the idea that consumers would ever pay for content delivered online. "My message is, it's worse than you think, even though most of you realize it's pretty bad," said Mark Anderson, the tech-industry newsletter publisher. According to Anderson, the best way for Web content properties to survive is as charities.

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