No U.S. Action, So States Move on Privacy Law

Over two dozen privacy laws have passed this year in more than 10 states, in places as different as Oklahoma and California. Many lawmakers say that news reports of widespread surveillance by the National Security Agency have led to more support for the bills among constituents. And in some cases, the state lawmakers say, they have felt compelled to act because of the stalemate in Washington on legislation to strengthen privacy laws.

“Congress is obviously not interested in updating those things or protecting privacy,” said Jonathan Stickland, a Republican state representative in Texas. “If they’re not going to do it, states have to do it.”

For Internet companies, the patchwork of rules across the country means keeping a close eye on evolving laws to avoid overstepping. Many companies have an internal team to deal with state legislation. And the flurry of legislation has led some companies, particularly technology companies, to exert their lobbying muscles — with some success — when proposed measures stand to harm their bottom lines.

“It can be counterproductive to have multiple states addressing the same issue, especially with online privacy, which can be national or an international issue,” said Michael D. Hintze, chief privacy counsel at Microsoft, who added that at times it can create “burdensome compliance.” For companies, it helps that state measures are limited in their scope by a federal law that prevents states from interfering with interstate commerce.

This year, Texas passed a bill introduced by Mr. Stickland that requires warrants for email searches, while Oklahoma enacted a law meant to protect the privacy of student data. At least three states proposed measures to regulate who inherits digital data, including Facebook passwords, when a user dies.

Some of the bills extend to surveillance beyond the web. Eight states, for example, have passed laws this year limiting the use of drones, according to the American Civil Liberties Union, which has advocated such privacy laws. In Florida, a lawmaker has drafted a bill that would prohibit schools from collecting biometric data to verify who gets free lunches and who gets off at which bus stop. Vermont has limited the use of data collected by license plate readers, which are used mostly by police to record images of license plates.

California, long a pioneer on digital privacy laws, has passed three online privacy bills this year. One gives children the right to erase social media posts, another makes it a misdemeanor to publish identifiable nude pictures online without the subject’s permission, and a third requires companies to tell consumers whether they abide by “do not track” signals on web browsers.

But stiff lobbying efforts were able to stop a so-called right to know bill proposed in California this year that stood to hurt the online industry. The bill would have required any business that “retains a customer’s personal information” to share a copy of that information at the customer’s request, as well as disclose which third parties have received the information. The practice of sharing customer data is central to digital advertising and to the large Internet companies that rely on advertising revenue.

“ ‘Right to know’ is an example of something that’s not workable,” said Jim Halpert, a lawyer with the national firm DLA Piper, who leads an industry coalition that includes Amazon, Facebook and Verizon. “It covers such a broad range of disclosures. We advocated against it.”

More than a year ago, the White House proposed a consumer privacy bill of rights, but Congress has not yet taken on the legislation. And a proposed update to the 27-year-old Electronic Communications Privacy Act has stalled. The proposal would require law enforcement agencies to obtain a warrant, based on probable cause, before they could read through emails.

Several legislators said they felt compelled to act because Congress had not. “They don’t act in the best interest unless it’s in their best interest,” said Daniel Zolnikov, a first-time legislator in Montana. Mr. Zolnikov, a Republican, suggested that the lack of action was because of lobbying efforts from “special interests” on Capitol Hill.

So Mr. Zolnikov took up the privacy issue in his state house: Montana became the first state in the nation this year to pass a law that requires police to obtain a search warrant before it can track a suspect’s whereabouts through cellphone records.

According to a survey conducted in July by the Pew Internet Center, most Americans said they believed that existing laws were inadequate to protect their privacy online, and a clear majority reported making great efforts to mask their identities online. Some of those surveyed said they cleared browsing histories, deleted social media posts or used virtual networks to conceal their Internet Protocol addresses — and a few even said they used encryption tools.

Many states have already responded to those opinions. In the last couple of years, about 10 states have passed laws restricting employers from demanding access to their employees’ social media accounts.

California set the stage on digital privacy 10 years ago with a law that required organizations, whether public or private, to inform consumers if their personal data had been breached or stolen. Several states followed, and today, nearly every state has a data breach notification law.

This year, California amended that landmark law, adding an Internet user’s login name and password to the menu of personal information that is covered. The California attorney general’s office also has a full-time unit to enforce digital privacy laws.

But even in California, the steps taken on privacy legislation are not sweeping overhauls like those supported by the White House. And some bills in the state never become law at all. Last year, the Legislature passed a bill compelling police to seek a warrant before searching cellphone records to track a suspect’s location. Gov. Jerry Brown vetoed it, saying it did not strike “the right balance” between the needs of citizens and the police.

John Pezold, a Republican representative in Georgia, said that issues like creating jobs were more pressing than privacy for many of his constituents. But he said the issue of digital privacy was beginning to bubble up, especially because of the recent reports on eavesdropping by the federal government.

“They’re becoming increasingly wary that their lives are going to be no longer their own,” said Mr. Pezold, who plans to introduce a broad consumer privacy bill in the next legislative session. “We have got to protect that.”

Government Takes Legal Action Over Phone Spam

The messages, which typically promise gift cards to national chain stores or other prizes, are sent to random phone numbers and usually direct recipients to a Web site where they are asked for personal information like Social Security numbers or credit card numbers, agency officials said.

Rarely, if ever, do consumers receive any actual reward, said C. Steven Baker, the commission’s Midwest region director. Instead, the Web sites often take users through multiple screens that ask them for more detailed information or entice them to sign up for free trials of products, then charge them for shipping and handling.

“If any consumer gets that far and actually gets a gift card, it isn’t free,” Mr. Baker said, adding that the commission was not aware of anyone who had received a promised reward. He spoke to reporters in a teleconference from Chicago.

Roughly 60 percent of mobile phone users have received one or more spam text messages in the last year, he said, and about 15 percent clicked on the link included in the message.

The cellphone spam industry has proved lucrative because individuals have grown to trust their mobile devices in a way that they do not trust e-mail.

“People are much more likely to read a text message within a few minutes and to click on a link in a text than they are in an e-mail,” said Andrew Conway, a researcher at Cloudmark in San Francisco, which issues an annual report on messaging threats.

In the eight federal civil cases filed across the country in recent days, the F.T.C. named 29 defendants, including 18 individuals, most of whom worked for companies that were hired to send the text messages. One complaint was filed against the operators of one of the Web sites to which consumers were directed by the messages.

Among the companies named were Superior Affiliate Management, Rentbro, Appidemic, Verma Holdings, AdvertMarketing, Seaside Building Marketing and SubscriberBASE Holdings. The commission said it had no contact information for the defendants in the suits, most of whom could not be reached for comment. Lawyers representing SubscriberBASE Holdings and individuals affiliated with that company said the parties had reached an agreement with the F.T.C. for a temporary restraining order, but declined to comment further.

Sending unsolicited commercial text messages is illegal under civil law. Other laws are often violated when spam messages are sent to numbers in the federal “Do Not Call” registry.

The commission said it was pursuing an additional case charging contempt of court against Phillip A. Flora, a serial text-message spammer who was barred in 2011 from sending unsolicited texts. He faces potential felony charges of violating a federal court order, in addition to a new lawsuit filed by the F.T.C. against his company, Seaside Building Marketing. Mr. Flora could not be reached for comment.

The authorities said it was difficult to catch companies that send spam messages because they frequently change the phone numbers used to originate the messages, making them hard to track.

Spam waves have become much more frequent since phone companies began offering unlimited text-messaging plans. Now, spammers buy hundreds of SIM cards, the chips that make cellphones work, allowing them to send a flood of messages and then abandon the phone numbers.

The F.T.C. has received at least 50,000 complaints about spam text messages in the last few years, including 20,000 that related to an offer of a free prize, and the number of complaints is growing rapidly. Mr. Baker said the commission received seven times as many complaints in 2012 as it did in 2011.

Officials advised anyone who receives such a message not to click on any link and not to reply. In particular, they said, consumers should not text “Stop” or a similar direction back to the sender, as spam messages often suggest; that simply lets the sender know the phone number is active and therefore a candidate for sale to other marketers. Instead, consumers are requested to forward the text message to 7726, which is a central repository for spam messages that has been set up by cellphone carriers. The message should then be deleted, the officials said.

Some people who have received the unauthorized text messages are among the 12 percent of mobile phone users who do not have a text message subscription plan, the F.T.C. said. For these consumers, the messages could result in their being charged a per-text fee by their cellphone company.

In addition, some of the text messages can lead to steep, monthly “subscription” charges on recipients’ phone bills. While phone companies will usually reverse those fees once they are brought to their attention, it is generally up to consumers to monitor their accounts for unauthorized charges.

Mr. Conway of Cloudmark said there had been “a noticeable drop-off” in gift-card spam in the last three weeks, perhaps tied to the F.T.C.’s pursuit of enforcement actions. Now, he said, spammers are sending more bank account messages, seeking access to victims’ financial information.

State of the Art: Imagining Ho-Hum C.E.S. as an Action Movie - State of the Art

I mean, think about it: Apple, Google, Microsoft and Facebook don’t even attend C.E.S.; they’d rather make their product announcements on their own schedules without being locked into this every-January thing. It’s still a big show, bigger than ever this year, with 3,200 exhibits and 150,000 attendees, but I wonder why people bother. Whose product announcement will get any press at all when it’s buried by 3,199 others?

C.E.S.’s organizers publish a daily magazine during the show that profiles new products announced there. Here are some actual examples: “Braven Expands Bluetooth Speaker Line.” “Armpocket Unveils Smartphone Cases.” “Bits Ltd. Expands Line of Surge Protectors.”

So if you want an exciting column from me, the thrills won’t come from the news of new products at C.E.S. I’ll have to spice things up another way. See what you think of this.

As he plummets toward the Nevada desert, two deafening sounds assail Daxton Blackthorne’s eardrums — the wind rushing past his ears at terminal velocity, and a deafening explosion over his head. Fumbling for his parachute cord, he’s blasted by the searing heat from the fireball that, until seconds ago, was his Cessna Citation.

For now, though, his concern isn’t the air-to-air missile that has just dispatched his jet, courtesy of the Bora Boran Mafia on his tail. It isn’t even the fact that Daxton Blackthorne is all that stands between them and the collapse of American democracy.

It’s finding a good place to land.

There! Squinting in the blinding sun, he spots an enormous chain of low-slung buildings, stretching through the bustling downtown like a sleeping cobra: the Las Vegas Convention Center.

He hits the roof of the South Hall hard — too hard. Keeping low, he scuttles across the gravel to a ventilation shaft and emerges, moments later, in a blasting cacophony of color, sound and electronics.

He hears the crash of boots behind him as his pursuers explode from the same shaft. Got to move, Daxton thinks. Detaching his ’chute, he darts among the booths, dodging clumps of buyers, reporters and electronics executives.

He weaves among the exhibits, barely noting their wares. External battery packs for phones. Car chargers for phones. Screen protectors for phones. Cases for phones.

What is this place? he thinks, pulse pounding.

Booth after booth. GPS units. Tablets. Earbuds. Bluetooth speakers. Phone cases. Row after row of Chinese manufacturers he’s never heard of. Like this one, Huawei, selling the world’s largest Android phone — the thin, shiny Ascend Mate, with a 6.1-inch screen. That’d be like talking into a cutting board, he thinks.

He bursts into the Central Hall, and the sensory overload is immediate; he pauses, gasping, to take it in. TV screens. Thousands. Screens bigger than a man. Screens stacked up to the distant ceiling. Screens brighter and louder than explosives in the morning. Sharp, Sony, Samsung, LG, Toshiba, Panasonic. The bombardment is almost as lethal as the one that took down his Cessna.

Here are OLED screens, with incredibly black blacks, vivid colors and razor-thin bodies; this LG model is only 0.16 inches thick. Panasonic and Sony each claim “the world’s largest OLED screen” — 56-inch prototypes.

Footsteps pound behind him. Too late to run. He’ll blend in. He merges into a throng of eager showgoers.

“Three-D may have been a flop,” a rep is saying. “But this year, the industry is back with an irresistible offering: 4K television. Ultra HD, we call it. You thought HDTV was sharp? Now imagine: four times as many pixels. Stunning picture quality, in stunning screen sizes.”

Daxton figures you’d have to sit pretty darned close to see any difference between HDTV and 4KTV. But never mind that — out of the corner of his eye, Daxton spots the black uniforms of his pursuers, fanning through the crowd. Play along, he thinks. “Excuse me,” he shouts in a faux French accent. “What is there to watch in 4K?”

“Unfortunately, 4K video requires too much data for today’s cable, satellite, broadcast, Blu-ray, or Internet streaming,” is the reply. “But at Sony, we’re leading the way! If you buy our 84-inch 4K television for $25,000, we’ll lend you a hard drive with 10 Sony movies on it — in gorgeous 4K.”

Daxton can think of better uses for $25,000; a jetpack would come in handy right about now. He dives into the crowd. Must. Find. Disguise.

A crowd wearing headsets is gathered before a Samsung TV. That’ll do. He grabs one; it covers both his eyes and his ears.

“You’re seeing a prototype of Samsung’s OLED dual-view technology,” the spokesman says. “This TV can display two 3-D video sources simultaneously, or four regular ones. Imagine: Your children can be playing Xbox while you watch the Super Bowl!” Daxton moves the switch on the earpiece; sure enough, the TV’s image changes accordingly, along with the audio from the tiny earpiece speakers.

But angry shouts in Tahitian are closing in. He bolts through an archipelago of audio booths, hawking celebrity headphones bearing the names of the rapper 50 Cent, the heavy-metal band Motorhead, the runner Usain Bolt, the N.F.L. quarterback Tim Tebow and the TV reality star Snooki. When did Snooki become an audiophile? he wonders.

By the time he storms into the North Hall, his lungs are screaming. He stands, panting, in a broader area populated by gleaming, polished automobiles. Here are Ford and General Motors, announcing new developer programs, open platforms for new apps that will run on their cars’ computer screens. Ford’s Sync AppLink bans games and video apps, for safety reasons. Good thinking, Daxton thinks. Wouldn’t want distracted driving.

Here are Audi and Lexus, announcing self-driving cars. Glancing at the video loop, he notes that the Audi prototype can, at this point, drive itself only through specially equipped parking garages, like the one set up at the Mandarin Oriental for a demonstration.

But on the Lexus stage, he spots something much more enticing: a car, festooned with sensors, that can actually drive itself on regular roads, much like Google’s fleet of 12 autonomous cars.

“California and Nevada have both made self-driving cars legal, with certain restrictions,” the executive on stage says. “And this Lexus LS safety-research vehicle is a pioneer. The 360-degree laser on the roof detects objects up to 230 feet away; the front camera knows if the traffic light is red or green. Side cameras, GPS and radar enhance what could someday be a safe, efficient, road-aware vehicle.”

There’s a burst of commotion from Daxton’s near right. It’s them. He vaults onto the stage. “Love the idea of self-driving cars,” Daxton tells the presenter. “But right now, I need a car I can drive myself.”

A saber blade shatters the air next to his ear. With a burst of adrenaline, he dives through the open window of the Lexus. His assailants push through the crowd and clamber after him, but he’s already powered on the car. Huddling low, he guns the engine and shifts into gear.

As a hail of bullets shatters the rear window, the Lexus arcs off the stage, plows through seven rotating shelves of phone cases, and, in a cloud of plaster and twisted beams, erupts through the wall of the convention center.

With a wry smile, Daxton adjusts his rear-view mirror just in time to see the knot of black-suited Bora Borans shaking their fists in the distance.

He brushes some safety glass off his shoulder, slips on sunglasses, and leans back into the leather seat.

“Now that’s what I call an exciting show,” he says, grinning, and he swings onto the open road for home.

This article has been revised to reflect the following correction:

Correction: January 18, 2013

The State of the Art column on Thursday, about the range of wares on  display at the Consumer Electronics Show, misspelled the name of a Chinese electronics manufacturer at the show. The company is Huawei, not Huwei.

Samsung Drops Action to Block Apple in Europe

PARIS — Samsung said Tuesday that it had dropped its request for a ban on sales of certain Apple phones and tablet computers in Europe, a sharp tactical turn in a patent war that the companies have been fighting on multiple fronts around the world.

Samsung, the South Korean electronics giant, had been seeking injunctions in a number of countries, including Britain, France, Germany, Italy and the Netherlands, contending that Apple, Samsung’s biggest rival in the smartphone market, had infringed on Samsung patents.

The move came only a day after a ruling in a related case in San Francisco, where a U.S. District Court judge rejected a request by Apple, which is based in California, for an injunction to block sales of certain Samsung devices. The decision followed a previous jury ruling that Samsung had violated Apple patents.

After the latest twist in the European case, Samsung said it had acted “in the interest of protecting consumer choice.” Analysts said other factors might have been in play, including a possible nudge from the European Commission.

In January, the commission opened a formal antitrust investigation of Samsung’s terms for licensing patents covering wireless technologies. Under a previous agreement, Samsung had pledged to make the patents available to competitors on “fair, reasonable and nondiscriminatory” terms.

“The scope of what was withdrawn precisely matches the area in which the European Commission has been investigating,” said Florian Müller, a patent consultant in Germering, Germany. “It’s not just that the plot is thickening; in my view, there can be no other plausible view than that there is pressure from Brussels.”

The commission had said previously that it was concerned about possible abuse of patents like the ones at issue in the Apple-Samsung injunction request, those covering technologies needed for a device to function. Without some of these “standard essential patents” from Samsung, for example, phones cannot connect to high-speed wireless networks.

“Regulators have been saying, if the patent holders try to abuse these patents, then they are going to get in trouble,” Mr. Müller said.

The commission declined to comment directly on whether there might be a link between Samsung’s announcement Tuesday and the antitrust case in Brussels. “We take note of this development,” said Antoine Colombani, the spokesman for the E.U. competition commissioner, Joaquín Almunia. “Our investigation is ongoing.”

Samsung, meanwhile, said it could not comment on the proceedings. It said it was “fully co-operating with the European Commission.”

“Samsung remains committed to licensing our technologies on fair, reasonable and nondiscriminatory terms, and we strongly believe it is better when companies compete fairly in the marketplace, rather than in court,” it said in a statement.

There has been speculation that Samsung and Apple have been in talks to try to reach a settlement, though the broad scale of the litigation between the two companies, with lawsuits seeking sales bans or damages continuing on several continents, could make that challenging.

“We cannot comment on details of ongoing legal proceedings, but we believe a commercial resolution is achievable,” Samsung said in a statement.

Alan Hely, a spokesman for Apple, declined to comment.

The announcement by Samsung does not end litigation between the two companies in Europe. Samsung said it planned to pursue lawsuits seeking damages from Apple for what it contends is patent infringement.

Apple and Samsung have also been battling over other patents, covering nonessential features of their devices, like design.

Apple, too, has previously secured bans on the sale of certain Samsung products. Last year, for example, a court in Düsseldorf ruled that Samsung could not sell one of its Galaxy tablet devices in Germany because it bore too close a resemblance to the iPad 2 from Apple.

While some analysts cited regulatory pressure as a possible reason for Samsung’s decision Tuesday, others said the company might have decided that the lawsuits were simply a distraction. Samsung’s phones, especially its Galaxy S3, have been selling well.

In the third quarter, the S3 surpassed the iPhone 4S to become the world’s best-selling smartphone, according to Strategy Analytics, a research firm.

“Maybe the market was telling them that they were succeeding and their time was better spent promoting sales of their product,” said Charles Golvin, an analyst at Forrester Research.

James Kanter contributed reporting from Brussels.