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Wal-Mart had sent an e-mail to consumers last month that, starting October 9, it would no longer assist with digital rights management issues for protected files purchased from Walmart.com.

That means that anyone who had those music files would still be able to access them on the devices or computers they reside on, but wouldn’t be able to transfer them to new devices.

Yahoo and Microsoft had announced similar plans when shuttering their DRM programs, but both companies backtracked after sharp criticism.

Engadget has posted an e-mail that Wal-Mart reportedly sent to music customers informing them that “we have decided to maintain our digital rights management (DRM) servers for the present time,” and that their customer service team “will continue to assist with DRM issues for protected windows media audio (WMA) files purchased from Walmart.com.”

Now, reports say Wal-Mart has told consumers that it, too, will continue to support the DRM-protected music.

New reports say Wal-Mart may have reversed its policy on digital rights management, and will keep servers online for the near future.

A spokesman for Wal-Mart could not immediately be reached for comment.

Mike McGuire, a music industry analyst for Gartner, said that the royalty board made a wise decision for consumers, musicians, and download stores by not raising rates. The download stores are competing against piracy, and obtaining illegal downloads is simple and they’re hard to compete with on price: they’re free.

“What DiMA had asked for was a reduction to 4.5 cents (or 55 percent),” said Carnes, who has written songs for Alabama, Reba McEntire, and Dean Martin. “When you look at 9.1 it’s only a disaster, but 4.5 is Armageddon…If you look at record sales, they’ve just been a disaster. It’s hard to go to the judges and ask for money at this point of time… Everybody is hurting, frankly, and until we get a solution to the massive looting on the Internet we’re not going to be able to move this thing much.”

Music industry sings the blues
The group representing music publishers applauded the CRB’s decision publicly but not everybody on that side of the debate was happy. One music industry source familiar with the negotiations said the publishers would probably have liked more money but should be happy that the CRB didn’t attach the rate to a percentage of a music store’s revenue.

A music industry source said that Cue’s statement to the CRB may have gone a long way in persuading the CRB not to boost rates. “Sure it was posturing,” said the source. “That’s what you do in court. I don’t think Apple would have gone out of business but a statement like that from the biggest music retailer is going to carry some weight.”

What all this means of course is that Apple will not be shuttering iTunes–as if there was ever much of a chance of that–and appears to remain very much in control over the economics of digital music.

But in my dealings with music publishers, I’ve heard them complain for a long time about the 9-cent royalty rate. In some corners, the lack of any increase will not be received well. Nobody has been a more vocal proponent of raising rates than Rick Carnes, president of the Songwriters Guild of America. On Thursday, Carnes acknowledged he had hoped for an increase. Still, he insisted there was still plenty to be happy about.

That would have created huge accounting headaches, according to the source. The decision also prevents DiMA from going to Congress in the same way that the Webcasters did last week, according to the source.

The Copyright Royalty Board on Thursday froze the rate that digital-music stores such as iTunes and RealNetworks’ Rhapsody must pay music publishers.

“We’re pleased with the CRB’s decision to keep royalty rates stable,” said an Apple spokesman.

The group representing music publishers had sought a per-song rate boost from 9.1 cents to 15 cents, a 66 percent increase. The rate is paid to music publishers by the record companies, which deduct it from the 70 cents Apple pays them for every song it sells. Certainly, nobody can predict what Apple will do, but at this point, it looks as if the company got what it wanted. In short, Apple won.

Pandora, an online radio service was part of a movement to negotiate a new rate for streaming music (as opposed to downloads) with the music industry. That movement lobbied hard in Washington and won congressional OK to reach a settlement with the music industry on a compulsory license.

Mark Litvack, an entertainment and copyright attorney and a former legal counsel for the Motion Picture Association of America, said rates have traditionally gone up during these kinds of negotiations. But Apple has “effectively set the economics of the music industry, which now appear to be frozen.”

” What DiMA had asked for was a reduction to 4.5 cents (or 55 percent). When you look at 9.1 it’s only a disaster but 4.5 is Armageddon.”
–Rick Carnes, president of the Songwriters Guild of America

The three-member board that sets statutory copyright licenses e-mailed the Digital Media Association (DiMA), the National Music Publishers’ Association, Apple, and other download stores with its decision to keep the royalty rate at 9.1 cents a song. The board also set the same rate for CDs and established a 24-cent rate for ringtones. The decision is the first time the board has established royalty rates for digital downloads. The rates are set for the next five years.

“This was a smart move by the CRB,” McGuire said. “This is still a new and struggling industry and now isn’t the time for a drastic rate increase that will have an effect on pricing.”

Alarm bells were set off on Tuesday when Fortune magazine reported that Apple had told the CRB that “it most likely” would shut down iTunes if forced to pay too high a royalty rate. Eddy Cue, Apple’s iTunes manager, had told the royalty board in April 2007 that the company “would not continue to operate (iTunes), if it were no longer possible to do so profitably.”

We’ll be monitoring the launch in several different time zones on Friday as always, so be sure to come back here early Friday for the full run-down of the day’s events.

The 3G S is faster and has better battery life, as well as some new features like video recording and voice control, but for many users it might not be as compelling an update. Plus, most of the features lacking in the iPhone and iPhone 3G can be corrected by downloading the new operating system, iPhone OS 3.0.

Will people camp out for the new iPhone as in years past?

Whether or not they come out in large numbers on Friday, it sounds like the process might be a bit more orderly this year. The iPhone 3G S will be available for purchase at Apple and AT&T stores starting at 7 a.m. on Friday. AT&T customers who preordered the device for in-store pickup can get their phones starting at 7 a.m. AT&T customers who didn’t reserve one will have to wait until 9 a.m. The iPhone will be sold on a first come, first served basis at all Apple stores.

Things could be different this Friday for several reasons: Some current iPhone owners are being forced to wait to upgrade by their carrier; the hardware update isn’t as dramatic as it has been in the past; and there’s the possibility that the novelty of line-waiting has worn off.

The other reason the crowds could be lighter this year is that the 3G S isn’t nearly as big of a leap forward for Apple as in years past. (See CNET editor Kent German’s full review.) The original iPhone was the single-most anticipated piece of consumer technology probably ever, and the iPhone 3G was a major upgrade in terms of hardware and network connection speed from the original iPhone.

Another difference this year: Apple allowed customers to preorder the iPhone 3G S online for home delivery. Last year, customers were forced to go to an Apple or AT&T store to activate their phone.

Despite the intense amount of interest in Apple’s third-generation
iPhone, this Friday’s launch of the device may not bring out the hordes of Apple fans like it has in years past.

In other words, AT&T is making it prohibitively expensive for many customers who are in the habit of getting a new model iPhone every year. The reason makes sense–the carrier is subsidizing the cost of the new phone for those who sign contracts and doesn’t want to do that every year–but it’s likely to keep at least some of the most earnest and loyal iPhone customers away this Friday.

The first days that the original iPhone was on sale in June 2007 (and the iPhone 3G last July), lines at Apple and AT&T stores across the country snaked around city blocks, filled with both newbies and Apple’s most loyal customers anxious to be the first to get their hands on the much-anticipated smartphones. Some of the most ardent iPhone devotees camped overnight to be first in line. And, as a result, the launches were always accompanied by a media frenzy.

iPhone 3G buyers line up on launch day last year.

(Credit:
James Martin/CNET)

AT&T’s policy for current iPhone customers–which it altered slightly Wednesday–could be the biggest deterrent. AT&T customers whose contracts say they are eligible for a phone upgrade between now and September, and who pay at least $99 a month for iPhone service, will be able to buy the iPhone 3G S for the same price as a new AT&T customer: $199 for a 16GB model, or $299 for a 32GB model. But if you don’t fall into either of those categories, you could be eligible for “early upgrade pricing” of $399 for a 16GB and $499 for a 32GB. The full price of the phone without signing a two-year contract is $599 and $699, respectively.

(Credit:
James Martin/CNET)

So Apple on Friday released an update to the
iPhone OS (3.0.1) that takes care of an SMS vulnerability. It’s a fairly important patch, and usually when Apple updates the iPhone OS, jailbreakers have to wait until the Dev Team comes out with a new version of jailbreaking software before they can update.

But according to the iPhone Dev Team’s Twitter, this is not the case with the 3.0.1 firmware. In fact, the current versions of redsn0w and ultrasn0w work the same with the 3.0.1 firmware as they do with the 3.0 firmware that came out a few weeks ago. In short, the jailbreaking software already works. I checked with the Dev Team community and had this confirmed. “Restore to 3.0.1, run redsn0w, select the 3.0 file… Bang zoom.”

So go ahead, iPhone hackers, and secure your devices soon. You don’t have to worry about losing Cydia and other rogue apps.

(Credit:
Matt Hickey)

(Credit:
James Martin/CNET)

Four L39 patriot jets streaming colored smoke flew low over the bay during the celebration, from Marina Green down along the Embarcadero.

For more photos detailing the spectacular affair, see our photo gallery: MyTouch 3G gets campy launch in S.F.
Or see our related story here.

Touted as "an historical event of epic proportions", hundreds of observers watched the skies as 100 skydivers descended into the city amidst a plaza filled with balloons and confetti.

(Credit:
James Martin/CNET)

T-Mobile on Wednesday threw a coming out party for its new
Google Android-based phone, the MyTouch, with great fanfare. The celebration included skydivers, celebrity impersonators, and yes, even mimes. Here are a few of the more artistic photos from the event.

Against the backdrop of downtown San Francisco, balloons, streamers, and confetti filled Justin Herman Plaza Wednesday.

(Credit:
James Martin/CNET)

Electronic retinal implants that can help certain visually impaired people see better are getting closer to reality with a new MIT prototype (PDF).

What might early bionic vision look like? Very low-res. Check out this simulation from a research group at the Tokyo Institute of Technology that wants to use cultured neurons on an electrode array to simulate vision in patients where the optic nerve is not intact.

As of mid-July, though, 30 patients worldwide had been implanted with the Argus II retinal implant developed by California-based Second Sight. It features a 60-electrode grid fixed to the retina and has shown limited but promising results so far, as seen in this BBC interview with a blind man who is now able to perceive a white line on the floor and distinguish white socks from black ones.

MIT scientists led by John Wyatt, an electrical engineering professor, want to test their new prototype on patients within three years.

In this illustration, the glasses transmit data and power to the prosthesis.

MIT’s prototype retinal implant consists of a flexible substrate, power and data receiving coils, an electrode array, and a stimulator microchip.

Since retinal devices aim to replace the millions of photoreceptor cells in the eye, a high-resolution retinal prosthesis firing thousands of pixels at video speed will likely be required for near-natural vision. But that could be decades away.

Users would wear special glasses fitted with a small camera that relays image data to a titanium-encased chip mounted on the outside surface of the eyeball. The chip would then fire an electrode array under the retina to stimulate the optic nerve. The glasses would also wirelessly transmit power to coils surrounding the eyeball.

Engineered eyes a la Blade Runner remain a long way off. But by replacing the function of retinal cells, the implants could help provide a degree of basic vision to those afflicted with retinitis pigmentosa or age-related macular degeneration, major causes of blindness.

The implants have been successfully placed in pigs for as long as 10 months without damage to the electronics, according to MIT.

MIT has been working on retinal implants for 20 years as part of the Boston Retinal Implant Project. About 10 years ago, researchers tested the electrodes on six blind patients, who reported seeing cloud-like images when stimulated.

“To create a bionic eye is equivalent to trying to create a television as compared with a radio,” Nigel Lovell, a professor at the University of New South Wales collaborating with Australian groups to create a bionic eye, says in this video. “It’s orders of magnitude more complex.”

(Credit:
Shawn Kelly/MIT)

(Credit:
Boston Retinal Implant Project)

A new Argus model with a higher electrode count is currently under development.

One issue researchers must tackle is where to place the electrodes. The Australian group would place them on top of the retina, while MIT’s approach is to place them beneath the retina. MIT says that reduces the risk of retinal tearing and requires less invasive surgery.

About 20 teams worldwide are working to realize the dream of eye implants that could work as well as cochlear implants for the hearing-impaired. But the delicate structures of the eye, as well as engineering challenges, have made for slow progress.

“E-paper displays are taking off with consumers due to their low power consumption and ease of reading, especially in sunlight,” said Jennifer Colegrove, director of display technologies at DisplaySearch. “In addition, e-paper displays are ‘green’ because they reduce paper consumption.”

Despite the visual appeal of Fujitu’s color Flepia e-book reader, DisplaySearch asserts that the high price and technical challenges of color e-books will limit their sales volume until 2011. The more popular electrophoretic display technology is likely to continue to lead the market and generate sales of $5.8 billion in 2018.

The number of e-book readers on the market has risen steadily, starting with one model in 2003, three in 2006, five in 2007, and around 20 this year, notes the report.

Electronic paper is stacking up to be a high-growth market, according to a new report.

E-books are currently the main use and sales driver for e-paper. Most e-book readers, such as the Amazon Kindle and Sony Reader, use the electrophoretic display technology from E Ink. A few e-readers, such as Fujitsu’s Flepia, use a different technology called cholesteric LCD. Fujitsu’s device offers a color display but is more expensive than the Kindle or Sony Reader.

Sales of e-paper displays are projected to soar from $431 million this year to $9.6 billion in 2018, market researcher DisplaySearch said Wednesday.

Another competing technology called MEMS (micro-electro mechanical system) is expected to shift its market from cell phone displays to color and medium-sized e-books over the next few years.

The number of units sold is forecast to grow 22 million this year to 1.8 billion in 2018.

But other display technologies are poised for growth, the report said. Electrochromic displays, most commonly used in windows and other glass products, will target the market for smart labels and card displays. By 2013, electrochromic displays will be the leading technology for e-paper displays, DisplaySearch is forecasting.

(Credit:
Screenshot by Don Reisinger/CNET)

But to do that, they’ll be brought to the plug-in’s developer page, giving them a variety of options to choose from. It’s a little confusing at first and I’m not quite sold on the implementation. It might annoy some readers. But if your readers like it, the plug-in could significantly improve your chances of getting your posts on social networks. Test it out to see what your readers think before you commit to Instant Highlighter.

Go social with your blog

Instant Highlighter is a test case.

1. Digg Digg: Getting your content added to important content-syndication platforms is made simple with Digg Digg.

Social Bookmarks Sharing your content on different social networks is extremely important as you try to build your blog. Social Bookmarks will help you do just that.

Twitter Friendly Links makes your URLs much nicer.

With the help of plug-ins, you can extend the functionality of your Wordpress blog far beyond what’s available to you when you add it to your server.

3. Twitter Friendly Links: There’s something simple, yet compelling about Twitter Friendly Links.

(Credit:
Screenshot by Don Reisinger/CNET)

Twitter for Wordpress Twitter for Wordpress allows you to place your Wordpress updates into your sidebar for all your readers to see.

Digg Digg is a great way to syndicate your content around the Web.

(Credit:
Screenshot by Don Reisinger/CNET)

(Credit:
Kovshenin.com)

Digg Digg Although its name might suggest that Digg Digg is a way to get readers to share your content with the popular social news site, it’s much more than that.

Digg Digg allows you to add voting buttons to your blog. You can add a TweetMeme retweet button, a Yahoo Buzz button, and a “Submit to Reddit” option, along with your Digg button. The plug-in also allows you to decide where to place those buttons. You can choose the top, bottom, left, or right of your post.

Add to Facebook makes it easy for readers to syndicate your content.

After it’s activated, Twitter for Wordpress won’t automatically work. Instead, you’ll need to either drag-and-drop a Twitter widget into your sidebar or you’ll need to add some simple PHP code to the sidebar to have it display your Twitter updates. The Twitter widgets make it look nicer, but if you want a simple status message on your sidebar, the second option is fine. Twitter for Wordpress is a nice plug-in if you want something simple.

My top 3

FriendFeed Comments will display comments from the social site.

The plug-in provides a simple option at the bottom of each post, called “Share on Facebook.” When the reader clicks on that link, they’re immediately delivered to their Facebook page, showing a thumbnail of the image in your blog post, as well as the beginning of your post. If Facebook followers click on that link, they’ll be delivered to your page. It’s a neat utility. And it’s a great way to share content through social channels.

FriendFeed Comments If you’re a FriendFeed user, you know that it’s a great site to discuss interesting stories. FriendFeed Comments helps you bring those discussions to your blog.

Twitter for Wordpress is OK, but not great.

2. FriendFeed Comments: FriendFeed is a great discussion platform. It’s even better when it’s on your blog.

When you activate FriendFeed Comments, you need only to input your FriendFeed username, tweak a couple of settings, and watch all the comments about your blog post get added to your site. Any comment placed on FriendFeed will be displayed on your blog. You can see the discussions made between different people on the social network. Even better, all those comments are placed in-line with comments made on your blog.

(Credit:
Screenshot by Don Reisinger/CNET)

(Credit:
Screenshot by Don Reisinger/CNET)

Social Bookmarks is a great way to get readers to share content.

When you activate Social Bookmarks, it automatically adds several social-networking icons to the bottom of each of your blog posts. When the reader chooses one of those options, they can send your post’s link to their social profile. The list includes Delicious, Twitter, Facebook, Yahoo Buzz, Digg, and more. Adding content to the profile is quick and easy. It’s a really nice app. Check it out.

(Credit:
Screenshot by Don Reisinger/CNET)

When readers share a blog post with their Twitter followers, the link won’t show the full post URL. Instead, the Twitter link will display your site’s domain, followed by a unique identifier. It’s similar to TinyURL or Bit.ly, but instead of those domains, you’ll see your own. It’s a simple feature, for sure, but it’s extremely useful for those who don’t want to lose Twitter-based traffic due to a long URL.

One of the best ways to get the most out of your blogs is through social plug-ins. These simple plug-ins can be added to your blog to help you connect socially with both your readers and their friends. They offer a fine way to build traffic to your site.

Add to Facebook If you want to make it easy for readers to syndicate your content to Facebook, Add to Facebook is the plug-in for you.

Twitter Friendly Links Since many Wordpress blogs don’t provide the most Twitter-friendly links, Twitter Friendly Links helps solve that problem by automatically shortening your blog’s URLs.

Instant Highlighter Instant Highlighter provides readers with the option to highlight different portions of your blog posts and share that with Twitter, Facebook, Yahoo, and other social sites. They can also save portions of your blog post for their own future consumption.

The new USAA Deposit@Mobile feature expands on the bank’s existing iPhone app, which debuted in May and has been downloaded almost 140,000 times, says USAA. The free mobile app already lets customers check their balances, transfer funds, and find ATMs.

(Credit: USAA)

In the latest twist on electronic banking, customers of financial services firm USAA will now be able to deposit checks directly through their iPhones.

“Our members are on-the-go and need to be able to manage their accounts at all times, from any location,” Wayne Peacock, USAA’s executive vice president of enterprise business operations, said in a statement. “Nearly 50 percent of our 1 million mobile users are active-duty military, who may be deployed anywhere. The convenience of mobile access is essential to delivering the highest possible level of customer service.”

The mobile check depositing is also the next step from USAA’s Deposit@Home service, which lets customers scan and deposit checks using a PC and scanner.

The video below from USAA shows how the check deposit feature works.

USAA on Tuesday updated its iPhone app to allow customers to deposit checks wirelessly. By taking a photo of both sides of the check using the iPhone’s built-in camera, customers can send an image of a check directly to USAA where it can be verified and deposited.

Spurred by the shift to 3G wireless technology, cell phone operators and financial institutions in recent months have introduced a number of services and applications geared toward mobile banking. Last September, for instance, Sprint Nextel introduced its MyMoneyManager app, which lets users wirelessly check bank balances and pay bills, while credit card provider Visa introduced several similar initiatives.

(Credit:
Tom Krazit/CNET)

Most of the questions came from students who wanted to know how American companies can break into the fast-growing Chinese market. Li said there’s no substitute for having a local presence in China, and not to underestimate the growth of the Internet in China. Baidu’s search index triples every year, he said, and competitors often can’t keep pace with that growth, meaning they do not offer all the pages that Chinese Web surfers seek.

PALO ALTO, Calif.–Baidu CEO Robin Li, on a rare visit to Silicon Valley Wednesday, explained the rise of his company’s search engine in China before a group of students more interested in entrepreneurial tips than censorship.

The Internet is new everywhere, Li said, but it’s especially new to China. That means that regulations haven’t always anticipated the issues that can arise on the Internet and lag the pace at which the Internet evolves, he said. But he otherwise avoided any mention of Baidu’s role in preventing Web pages that run afoul of the Chinese government from appearing in Baidu’s search results: a 2008 study by the University of Toronto’s Citizen Lab found that Baidu censors far more search results than competitors.

Li was given a very warm reception from the students, who massed around him after his talk to have their pictures taken with one of China’s most prominent CEOs. Only one student hinted at the censorship dance required to operate a search engine in China, asking Li how his company manages the tricky relationships with regulators.

Baidu CEO Robin Li advised Stanford students to make sure they understand the Chinese market if they want to do business there.

Li ended a trip to the U.S. Wednesday at Stanford University, speaking to a crowd of several hundred students about the lessons he learned shepherding Baidu through the first dot-com bust and growing it into the Google of China. Baidu has 76 percent of the Chinese search market, he said, which consists of 338 million Internet users: larger than the entire population of the U.S.

“If you can’t find it on Baidu, you can’t find it anywhere else,” Li said. That, of course, can be interpreted in a number of different ways.

The key to Baidu’s success amid a terrible recession for Internet companies in late 2000 and 2001 was careful use of the initial venture capital investment in his company and making a tough decision to overhaul Baidu’s business model from providing back-end search technology to portals to designing its own front-end user interface, Li said. He also outlined his vision for future search called “box computing,” which seemed to involve a Chrome OS-style user interface that would run independently of the operating system as the start page for a new generation of computers and use semantic technology to deliver a search result more in tune with the searcher’s intention.