What's Next: Circling the wagons against cell phone exclusivity deals

By Angela Gunn and the Betanews Staff | Published July 7, 2009, 9:00 AM

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Hey, guess what? Your Social Security number!

Afternoon of Monday, July 6, 2009 • Carnegie Mellon researchers have run the numbers, and with information on just your date and place of birth, they can predict with decent accuracy some or all of the digits of your Social Security number. The problem's especially severe for the 21-and-under crowd, whose numbers were uniformly assigned soon after birth and therefore conform especially closely to certain well-known numbering patterns. The authors of the survey said they were able to ID all nine numbers of test subjects' SSN in fewer than 1,000 tries for 8.5% of that population, making those numbers "no more secure than a three-digit PIN." In smaller states such as Delaware, they could guess 1 out of 20 numbers in 10 or fewer attempts. The research is available at the link above and will be presented today (Tuesday) on the Proceedings of the National Academy of Sciences. The authors will also present at Black Hat later this month.

The political blogs are out in front with this story. (You reporter plans to tackle it tomorrow for Lockdown, by the way.) The Daily Kos goes to town on not only the SSN system but on the equally messed-up Green Card ID system, asking if we have "the political will and the administrative drive" to unscrew a system so outmoded and compromised. Randolph E. Schmidt tackles the story for Real Clear Politics, scoring a quote from a Social Security Administration official who calls claims that the code has been cracked a "dramatic exaggeration"... but says the SSA was planning to start randomizing those numbers next year anyway.

Code theft of trading-system IP could get interesting for Goldman Sachs

What's Now | What's Next main bannerSince July 3, 2009 • The unfolding story of Sergey Aleynikov, Goldman Sachs, Teza and some highly sensitive trade secrets will unfold for weeks, and though tech (specifically, Goldman's powerful trading tech) is at the heart of the matter, it's the effect on the markets and the way mega-traders such as Goldman do business you'll want to watch.

For straight-up reporting, Bloomberg's David Glovin and Christine Harper have the bases covered. Zero Hedge is the go-to site for sparky commentary on the developing situation -- not the tech details, but excellent context and a great overview of how this may prove to be not just a significant breach but a matter of national security. New York's Jessica Pressler picked up the most entertaining angle: Apparently Mr. Aleynikov is a more-than-passable ballroom dancer.

Sprint and Best Buy offering a 99-cent netbook, sort of

In your Sunday circular • May Sprint interest you in some EVDO action? If you don't mind hauling to your nearest Best Buy, the telco's offering a deal: Sign up for a two-year contract, and they'll throw in a wee Compaq Mini 110c-1040DX for the price of a soft taco. Kevin C. Tofel at jkOnTheRun ("Using mobile devices since they weighed 30lbs") spotted the deal and did the math; at $60/month for service, that's a $1440 99-cent netbook you're getting. FierceWireless reminds us that we've seen a few more tentative runs at this business model already.

Jammie Thomas-Rasset, RIAA make various grating requests

Monday, July 6 • Jammie Thomas, as per Ars Technica and Wired, would like that $1.92 million file-sharing judgment thrown out. The RIAA, as per the Associated Press and Home Media Magazine, would like the court to ban Ms. Thomas-Rasset from downloading or sharing any more tracks, and want the court to compel her to delete the tracks she's got. Your reporter wants all parties to fall in a deep, deep hole.

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Take notes, Yahoo will make its latest comeback play today

Morning of July 7, 2009 > We're expecting Yahoo to come forth later today with the public beta launch of Search Note, a service for users to take comprehensive, sustained notes on the Web sites that users locate using Yahoo search.

Now, Google is already out there today with its usual deflating comments, saying stuff like, "We've already got that." But Yahoo is looking for a way to get back in the game, especially in the realm of public opinion -- though it's still the #2 search engine in terms of traffic, it's been #3 in terms of buzz, thanks to Microsoft's somewhat successful Bing rebranding.

So expect Search Note to be a feature that puts Yahoo more prominently in the user's face throughout the entire research session, rather than exiting once the user thinks he's found what he's looking for. Betanews will start testing Search Note later today (assuming the launch goes as planned), and we'll let you know what we find.

Nation's new top trustbuster will take the lead on cell phone exclusivity deals

July 2009 > After The Wall Street Journal reported yesterday unofficial information stating the US Dept. of Justice's new antitrust chief, Christine Varney, will spearhead a probe into cellular carriers' exclusive deals with phone manufacturers (such as AT&T/Apple), the lack of denial on anyone's part probably means the probe will happen. There's no official word yet from the Justice Dept., though we may expect a statement as soon as today.

The news comes after Congress held hearings into the matter, placing an AT&T president on the witness stand amid a largely hostile environment. There, Paul Roth testified that deals such as the one his company made with Apple for the iPhone actually drive innovation, since they enable monetary investments and guarantees that might not otherwise happen. Roth did have some backing up there, but Sen. John Kerry (D - Mass.) eliminated any hint of neutrality on the subject, heading a barrage of questions that frequently suggested an absense of a quorum. Sen. Kerry remains on point on this issue, as he will likely join incoming FCC Chairman Julius Genachowski and the DOJ's Varney in a public triumvirate that may cast suspicion on a practice whose alleged negative effects on competition may be under suspicion themselves.

Dell could pay thousands for that $15 monitor

This week > The Associated Press reports this morning that a pricing error that emerged on Dell's Taiwanese Web site has placed the manufacturer in hot water with the country's trade authorities. After having marked its Latitude E4300 notebook computer at 30% of its actual retail price, and marked a 19-inch LCD monitor at the equivalent of just over $15, the Fair Trade Commission -- the same agency that fined Intel last year -- is threatening to fine Dell if it doesn't honor those mis-marked prices, at least for the customers who saw them.

Reportedly, Dell did offer misinformed customers a discount of some kind, but just not a 70% discount. The company faces possible threats of up to roughly $750,000.

What's Now | What's Next divider 600 px Tuesday's tech headlines

The Register

• Rik Myslewski reports that we could start getting projection-capable cameraphones in our hot little hands as early as the end of the year.

• Some British police are now sporting uniform-embedded video cameras for on-the-hoof documentation of situations in which they might find themselves. But there's a problem that has nothing to do with surveillance, Lewis Page writes: According to union head Peter Smyth, "a couple of [the camera units] have caught fire, which isn't ideal." You don't say.

• A teenager in New Zealand found some nakey pictures of his mom in the garage and decided to sell them online. His mom was okay with it. It's not quite as disturbing as the guy who called a radio station here to dedicate Nine Inch Nails' "Closer" to his mom, but it's sure up there.

Mashable

• You knew it was a matter of time: "twitter" is on its way to the Collins English Dictionary.

• Jockipedia's subject matter may not be to the taste of most Betanews readers, but Ben Parr sees some excellent thinking in the wiki-slash-social-networking site.

• Why does Stan Schroeder find the iPhone "Pocket Cemetery" app morbid? It's sweet. Remind your reporter of a project or two on The Final Curtain, in fact.

• It is more Twitter-esque that there exists a game called "Die Fail Whale," or that the game itself lasts just 25 seconds?

Ars Technica

• The American Chemical Society, bowing to the inevitable, has announced that it'll switch publishing media -- print to digital -- for all but a few of its many scientific journals. John TImmer has details, and thoughts.

• So where's Mac Quicken '09? And why has Intuit removed all reference to it on its Web site? Jacqui Cheng has questions.

San Jose Mercury News

• Larry Magid hit the National Educational Computing Conference in late June.He saw some great ideas from innovative teachers, but he's worried that the kids using "back channel" chats and messaging tech during classes will end up behaving like tech professionals at other conferences he's attending -- which is to say, like children.

• Chris O'Brien profiles Marc Canter, one of Silicon Valley's true originals, and wonders whether Northeast Ohio will know what hit it when the legendary multimedia wonk relocates there for his latest project.

And elsewhere

• The Washington Post's Michael Bimbaum tells of an online-education program designed specifically for girls. Subject matter varies from calculus-level math to art and literature, and the teaching style is more collaborative as girls are alleged to prefer. (Don't look at me, pal.)

• David Strom at Datamation clearly had a fine time compiling his list of 25 innovative-but dead tech products released over the years. #24 engendered much amusement over here, but where the heck is our beloved RocketBook or the original, far superior Sharp Zaurus?

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Comments

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"Your reporter wants all parties to fall in a deep, deep hole."

You and me, both.

"Sen. John Kerry (D - Mass.) eliminated any hint of neutrality on the subject..."

Does anyone here actually still believe *any* of the folks in our government are still capable of *anything* outside of pushing their own agenda? Neutrality? Hah...haven't seen that in government since George Washington.

Without the exclusivity contracts, the prices on these phones will be the same as they are now *without* the contracts. Meaning: The same price you pay now for an unlocked iPhone will be the same price *everyone* pays. There will be no option for a cheaper version through AT&T.

Benefits? None. Everyone pays full price.

Yeah....good idea....or not.

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So, having a 2 year contract with AT&T would not lock you in?
Now, after that, yes, you could go to another carrier.
Of course there's that shiny new iPhone and new contract.

No way would the deals go away.

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First off, prices on iphones are only high because of the Apple Tax. Isupply did a breakdown on the Iphone 3GS and the components cost $178.96 So it would be within reason for Apple to price it at $250. And this is what the phone should cost w/o a contract.

Most people have this assumption that unlocked phones somehow should cost $500-$700. This is basically BS, and what the Phone companies want you to think so that you will buy the phone w/ contract at their "cheaper" price.

Think about it. If you go to AT&T's website, and look at phones, the Pantech C630 is priced at $230 w/o contract. W/ contract, they charge $80, and as of now, if you buy it online, you get it for Free. This is BS. Why would the manufacturing cost of this much simpler phone be $230, when you can get an Ipod Touch (with all the stuff in it) for the same price. I bet the REAL manufacturing cost of this phone is probably in the range of $50-$100. NOTE: I mention Ipod Touch b/c it is an electronic device that has a crap ton of technology, and isn't hindered by Cell Phone companies politics, so it is priced reasonably.

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@ghammer

The contract exists for all phones. If it were the case that simply the contract lowered prices, we would see that on more than just the exclusive phones. We don't; or at least, not in any way as drastic as the exclusive deals are.

@vikampion

Right. It's a conspiracy... They don't need to cover R&D costs or recover costs for developing the "next innovative phone"... Really? "Real Manufacturing Costs" have *nothing* to do with funding the research and development of the existing and future models....as has been stated time and time again. iSupply only gets the uninformed in a tissy. The rest of us understand that much more than just the "cost of the parts" is involved here.

I'd love to see you research, develop, test, market, build and support *anything* based on just the "cost of the parts"...

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I have to agree with PC on the cost issue. You can't divorce the R&D costs from the cost to manufacture in any technology product. This may be one reason many tech firms move production of the product overseas where manufacturing cost are less but cover the R&D costs.

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Again...you don't get it. Why does R&D cost for the crap phone I mention warrant a $230 price tag for it. When I'm sure the R&D costs for an Ipod Touch are much higher, but Apple is still only charging ...surprise....the SAME $230 price.

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"Why does R&D cost for the crap phone I mention warrant a $230 price tag for it. When I'm sure the R&D costs for an Ipod Touch are much higher, but Apple is still only charging ...surprise....the SAME $230 price."

*laughing*

Ok, just stop. Seriously. You don't know what you are talking about.

R&D costs are not a "per model" factor. R&D costs are overhead, spread throughout all product-line and models. You cannot pick any single model and assume the cost of it covers the costs of parts and R&D solely for *that* model.

Look at consoles for an example. They sell most of them at a loss. Looking at the costs on those, they're *losing* money. They make that up on ancillary products, such as peripherals and software licensing.

Point being: parts cost is meaningless. Cost of the phone has *nothing* to do with the parts and R&D for that specific phone alone. The whole idea of such a thing is ridiculous.

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