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Utilities panel has too much on its plate

By: Kish Rajan

Assemblyman Mike Gatto is taking a bold step with his proposed constitutional amendment to obliterate the California Public Utilities Commission. Such a drastic action may not pass into law, but it kick-starts a critical conversation about the agency’s future.

Gatto cites concerns about the PUC’s handling of a string of problems related to energy utilities, including the San Onofre nuclear plant shutdown and the San Bruno gas line explosion. The commission is also deeply engaged in overseeing California’s massive shift away from fossil fuels to renewable energy.

If regulating the energy industry wasn’t enough of a chore, utilities are not the only sector under the PUC’s purview. The commission has divisions overseeing railroads, light rail and transit; taxis and ride-share services; and water and sewer systems.

And its jurisdiction over telecommunications is largely overlooked. As the center of the innovation economy, California relies heavily upon strong telecommunications infrastructure. But the commission is failing to keep pace with the fast-changing industry, holding back critical investments to providing more and better technology to more Californians, particularly low-income citizens on the other side of the digital divide.

According to the Milken Institute, San Jose and San Francisco are the best-performing cities in the nation for job growth, wage gains and technological advancement. While that is laudable, what is the PUC’s plan to extend that prosperity beyond the Bay Area and into every region across California?

The pathway to greater prosperity is through innovation and investment. That is driven by consumer demand supported by forward-looking thinking, rather than outdated regulatory mandates.

With Apple, The Government Is Overstepping Its Boundaries

By: Tim Sparapani

What we’re seeing right now with Apple AAPL -1.92% is a classic case of law enforcement overreach. The FBI is putting extraordinary (and unprecedented) pressure on Apple AAPL -1.92% in the wake of the San Bernadino shooting which left 14 dead and 22 wounded. The U.S. government has filed a court motion to press Apple to rewrite its operating software so that it can investigate whether the shooter used his phone to communicate and plan with others.

That might appeal to some people who are looking for a quick fix for the threat of terrorism. But the truth is there are no quick fixes and the government’s move is an extraordinary threat to liberty. It also won’t work. A backdoor won’t stop terrorism, it will only weaken phone security with no likelihood of any kind of public benefit. The public, and policymakers, should help Apple resist the FBI’s pressure. The FBI’s proposal is dangerous for at least these three reasons:

It Won’t Prevent Terrorism

The government wants Apple to build an after-the-incident forensic tool to figure out what may have happened. But that will not actually deter or prevent terrorism. Terrorists will simply switch to using encrypted phones from other countries. At the same time, the government’s move will weaken security for all U.S. consumers. This cannot and will not stop committed terrorists.

It Sets A Terrible International Precedent

If the U.S. government forces this technology on Apple, it’s also giving this technology to the rest of the world. That means rogue regimes, dictatorships and oligarchs will have access to the same security busting technology as the U.S. government. One nation’s terrorist is another’s journalist, reformer, freedom fighter or human rights advocate. Limiting security on iPhones could put these people, who are often on the frontlines of fights against oppression, in grave danger.

Read the full article here.

We Need To Talk About Security On The Internet Of Things

By: Tim Sparapani

Some horrifying stories surfaced recently about glaring data security vulnerabilities for the Internet of Things. A company called Shodan, which is a search engine for connected devices, has had no trouble pulling up video camera feeds of sleeping babies, marijuana plants and schoolrooms. The site found insecure connections for everything from traffic lights to ice rinks. Those gaps are a hacker’s playground, and they should worry consumers and companies hoping to capitalize on the market for Internet-connected devices of all kinds.

By collecting data from things like lightbulbs, factories and home appliances, engineers will be able to design endless apps to make things work more efficiently, saving energy and water while preventing equipment failure. That’s the essential promise of the Internet of Things (IoT) era. Thanks to the burgeoning IoT economy, we’re on the verge of having self-driving cars and appliances that tell us that their parts are about to fail.

But right now, that bright future looks a little dim. Security is paramount, and if manufacturers don’t take steps to assure the public that their devices are secure, that revolution will be delayed.

Perhaps because IoT devices are to date opaque — after all, there’s no interface for a lightbulb with sensors embedded in it — consumers haven’t been overly concerned about safety issues. Since this is still a relatively new industry, things like price and convenience have taken priority. We are in a type of technology limbo where we are learning that securing the data collected by these devices is essential, yet too few manufacturers have implemented robust data security protections for these devices.

But it will take just a few high-profile hacks to change that. Say, for example, all of the traffic lights in a big city suddenly went red at the same time and stayed that way. Or all of the lightbulbs linked to a given system went on in the middle of the night. An event like that would be enough to potentially scare people away from the IoT.

Read the full article here. 

Risks in Forcing Apple to Comply With Order to Unlock Phone Linked to San Bernardino Attack

By: Tim Sparapani

A federal judge’s order to help the Justice Department unlock a phone used by a suspect in the San Bernardino, Calif., shootings has put unprecedented pressure on Apple. In a letter to customers detailing the company’s opposition, Apple CEO Tim Cook noted that there are “implications far beyond the legal case at hand.” Yes, the owner of the phone–Syed Rizwan Farook‘s former employer–has given permission to search the device. But those who view the case as a potential means to combat the threat of terrorism are missing its threat to liberty, its potentially dangerous precedent, and the fallout to technological security. Consider:

Apple has said it complied with government search warrants and subpoenas. The Justice Department’s motion for Apple to disable particular security features on the phone presses the company to reformulate its operating software so that U.S. investigators can learn whether Mr. Farook used the iPhone to communicate with others about the November shootings. Forcing companies to create technologies to break their operating systems or override security features creates an after-the-incident forensic tool to figure out what may have happened. This does not actually deter or prevent terrorism. People determined to carry out attacks will continue to do so. They will simply use the encrypted products and devices sold by companies based outside the U.S. or other countries whose governments pry open their devices. At the same time, security protections for all consumers of those products will be weakened.

Such a move would set a dangerous international precedent. If the U.S. government forces Apple to undermine its technology there will be no means for companies to take a principled stand when rogue regimes, dictatorships, oligarchs, and other bad actors around the world make a similar request. One nation’s terrorist is another’s journalist. Or reformer, or freedom fighter, or rights advocate. In the wrong hands, the implications could extend to instances regarding human life, free speech, privacy, and other fundamental human rights around the globe.

In the immediate and long term, there is also a malware risk. Forcing Apple to reformulate its operating system is all but asking for the introduction of a bug, flaw, or defect–those forced upon companies by governments and those introduced through the vulnerabilities created by criminal hackers, identity thieves, and the government-sponsored spies of foreign nations.

Read the full article here. 

U.S. Supreme Court Should Clarify the Law of Design Patents

By: Tim Sparapani

It’s been 120 years since the US Supreme Court last heard a case regarding design patents. Now it has the opportunity to do so again, and it should, because technology has advanced yet the interpretation of laws protecting innovations has become ill fitting and out of date.

Samsung recently agreed to pay $548 million in damages to Apple following several appeals regarding claims that Samsung infringed on some of Apple’s design patents. Samsung has petitioned the U.S. Supreme Court to review the case and address the issues it raises that extend well beyond smartphones.

This legal clash of tech titans over whether Samsung infringed Apple’s design patents spawned extended debate over what is protected by a design patent and may lead – if the dispute is reviewed and precedent set – to a more solid framework for design patent protections and dispute resolution clarity in future cases.

For more than five years, these companies slugged it out concerning the limitations of design patents, how to determine whether patented designs were infringed, and the proper remedies.  The case is notable, not just because of the size and importance of these companies, but also because of the precedents that this case sets for our digital age when hardware and software are merging together in novel and unforeseen ways.

Rarely are cases so well teed up for the Supreme Court to offer crucial guidance in an area of law that has become so muddled.  Given the extensive motions, trials, remands and appeals between Apple and Samsung this case seems primed for Supreme Court review because the legal issues have been highly refined allowing the Court to issue narrow decisions on legal grounds that nevertheless have broad impact.

Read the full article here. 

Raising Music Royalties Takes A Toll On Innovation

By: Mike Montgomery

2016 has started out on a sour note for Live365. The online radio service, which specializes in user-curated music, announced that it has had to lay off a significant portion of its staff and will likely shut down later this year.

The reason: A decision by the Copyright Royalty Board to raise the rates non-interactive Internet streaming services like Pandora have to pay for the right to spin music. In December, the board raised the rate from 14 cents per 100 plays to 17 cents.

Three cents is trivial, right? Not exactly. It might not sound like a lot of money, but for small Internet streamers like Live365, it’s the difference between survival and ruin. It’s hard enough to run a business when 50% or more of a non-interactive streaming company’s revenues go toward royalty payments. It’s even more challenging when what’s left over can’t be reinvested into innovation or marketing in order to enhance the customer experience or grow the listener base through marketing and promotions.

Live365 isn’t the only victim of the CRB’s decision. SmoothJazzChicago, a site run by radio vet Rick O’Dell, is also shutting down. O’Dell cited the new royalty rates as one of the main reason he’s turning off the lights.

While the rate hike certainly harms the bigger players, it’s devastating to a whole tier of streaming companies that either serve niche audiences or were just getting off of the ground. There’s no doubt it’s also affecting the army of entrepreneurs in Silicon Valley and elsewhere who are currently hard at work on the next big thing for Internet music, not to mention the venture capital that will instead go toward startups that don’t have to give away the lion’s share of their revenue in order to avoid collapse.

Read the full article here.

NASA Wants You (To Help Design A Robotic Arm)

By: Mike Montgomery

In The Martian, Matt Damon’s Mark Watney scienced the shit out of a myriad of problems using his brains, his brawn and a ton of duct tape. If you watched the movie and thought, I could come up with some good ideas, you’re in luck. NASA is turning to the general population to solve some very space-specific problems.

The space agency’s latest crowdsourced contest involves a robotic arm. NASA is working with to solicit ideas from every corner of the world. (The site is where all of the applications will originate.) It doesn’t matter if you’re a writer, an engineer or an armchair rocket scientist; everyone now has a chance to have their best ideas heard.

“There’s plenty of literature that says you get the most innovative ideas from people applying the knowledge they have to new disciplines,” says Jason C. Crusan, NASA’s director of advanced exploration systems and the lead for the NASA Center of Excellence for Collaborative Innovation. “We’re giving them a shot.”

This isn’t the first time NASA has crowdsourced a solution. The agency’s innovation center opened in 2011 after President Obama signed a law authorizing (and encouraging) all government agencies to conduct prize competitions.

NASA’s first contest involved creating an algorithm to determine the right mix of medical supplies to take on a mission, taking into consideration the different needs of the crew, the risks involved and the tiny amount of available space.

Read the full article here.

‘Shark Tank’ or Y Combinator? Moguls Duke It Out

By: Mike Montgomery

There’s no question that going on Shark Tank gets you plenty of attention. The reality show has attracted as many as 7 million viewers at a time who tune in to see great ideas score investments and terrible ideas slink back to the drawing board.

But should aspiring entrepreneurs really be eyeing Shark Tank as a viable way to get money?

Y Combinator’s Paul Graham says no. Last week on Twitter TWTR +11.11%, the venture capitalist called out Shark Tanktweeting: “Startups: Instead of appearing on Shark Tank, spend that energy fixing whatever makes your product so unappealing you think you need to.”

Shark Tank judge Mark Cuban, a man who never backs down from a fight, shot back with, “You mean like the sense of entitlement and arrogance they get when they become part of a YC class? It’s hard to wash out.”

 Investor Chris Sacca even jumped into the fray tweeting: “Yeah, because a free 10-minute pitch to 7 million Americans is something every startup should turn down.”

So what’s the right thing to do?

Read the full article here.

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