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Apple unveils DRM free music on Itunes
Business | 2007/04/02 08:50

CUPERTINO, California--Apple® today announced that EMI Music’s entire digital catalog of music will be available for purchase DRM-free (without digital rights management) from the iTunes® Store (www.itunes.com) worldwide in May. DRM-free tracks from EMI will be offered at higher quality 256 kbps AAC encoding, resulting in audio quality indistinguishable from the original recording, for just $1.29 per song. In addition, iTunes customers will be able to easily upgrade their entire library of all previously purchased EMI content to the higher quality DRM-free versions for just 30 cents a song. iTunes will continue to offer its entire catalog, currently over five million songs, in the same versions as today--128 kbps AAC encoding with DRM--at the same price of 99 cents per song, alongside DRM-free higher quality versions when available.

“We are going to give iTunes customers a choice--the current versions of our songs for the same 99 cent price, or new DRM-free versions of the same songs with even higher audio quality and the security of interoperability for just 30 cents more,” said Steve Jobs, Apple’s CEO. “We think our customers are going to love this, and we expect to offer more than half of the songs on iTunes in DRM-free versions by the end of this year.”

“EMI and iTunes are once again teaming up to move the digital music industry forward by giving music fans higher quality audio that is virtually indistinguishable from the original recordings, with no usage restrictions on the music they love from their favorite artists,” said Eric Nicoli, CEO of EMI Group.

With DRM-free music from the EMI catalog, iTunes customers will have the ability to download tracks from their favorite EMI artists without any usage restrictions that limit the types of devices or number of computers that purchased songs can be played on. DRM-free songs purchased from the iTunes Store will be encoded in AAC at 256 kbps, twice the current bit rate of 128 kbps, and will play on all iPods, Mac® or Windows computers, Apple TVs and soon iPhones, as well as many other digital music players.

iTunes will also offer customers a simple, one-click option to easily upgrade their entire library of all previously purchased EMI content to the higher quality DRM-free format for 30 cents a song. All EMI music videos will also be available in DRM-free format with no change in price.

The iTunes Store features the world’s largest catalog with over five million songs, 350 television shows and over 400 movies. The iTunes Store has sold over two billion songs, 50 million TV shows and over 1.3 million movies, making it the world’s most popular online music, TV and movie store.

With Apple’s legendary ease of use, pioneering features such as integrated podcasting support, iMix playlist sharing, seamless integration with iPod® and the ability to turn previously purchased songs into completed albums at a reduced price, the iTunes Store is the best way for PC and Mac users to legally discover, purchase and download music and video online.

Apple ignited the personal computer revolution in the 1970s with the Apple II and reinvented the personal computer in the 1980s with the Macintosh. Today, Apple continues to lead the industry in innovation with its award-winning computers, OS X operating system and iLife and professional applications. Apple is also spearheading the digital media revolution with its iPod portable music and video players and iTunes online store, and will enter the mobile phone market this year with its revolutionary iPhone.



Iraqi Arabs angered over Kirkuk relocation proposal
International | 2007/04/02 05:39

Arab residents of the northern Iraqi city of Kirkuk expressed anger Sunday at the government's plan to encourage relocation of the city's Arab population. Most of the city's current residents were forced to move to the now ethnically diverse, oil-rich city during the "Arabization" phase of Saddam Hussein's Anfal campaign, which drove out Kurds and brought in Shiite Muslims. The Iraqi government hopes to encourage relocation by offering 20 million dinars and a piece of land to each Arab family that voluntarily leaves the city.

Iraqi Kurds have expressed desire to incorporate the city into the nearby Kurdistan region. The compensation scheme has angered both Shiite and Sunni Arab parliament members over the fear that Kurds will attempt to seize control of the city in a move towards declaring independence from Baghdad. Iraqi Justice Minister Hashim Abderrahman al-Shebli [Wikipedia backgrounder] submitted his resignation to the Cabinet last week in the midst of the debate over the relocation scheme. Under the Iraqi constitution, a referendum must be held by the end of the year to determine the future of the city.



Enron Pays Out $1.47B to Creditors
Corporate Governance | 2007/04/01 22:49

Since November 2004, Enron has returned about $11.5 billion to creditors in twice-yearly distributions, in April and October, as well as in "catch-up" distributions paid on an interim basis every two months. Monday's distribution was its 15th to creditors, the company said.

Enron, once the nation's seventh-largest company, entered bankruptcy proceedings in December 2001 after years of accounting tricks could no longer hide billions in debt or make failing ventures appear profitable. The collapse wiped out thousands of jobs, more than $60 billion in market value and more than $2 billion in pension plans.

Enron founder Kenneth Lay and former chief executive Jeffrey Skilling were convicted last year for their roles in the company's collapse. Skilling is serving a sentence of more than 24 years. Lay's convictions for conspiracy, fraud and other charges were wiped out with his July death from heart disease.

"Today's distribution is another significant milestone in the liquidation process and represents a tremendous financial outcome for the Enron estate," said John Ray, president and chairman of the board. "The estate continues to focus on its principal mandate to sell remaining assets, settle claims, and prosecute litigation."

Monday's distribution consisted of about $1.7 billion in cash and $171.7 million in shares of Portland General Electric, Enron's former utility.



Bush defends Gonzales' role in US Attorney firings
Political and Legal | 2007/04/01 21:28

US President George W. Bush again defended US Attorney General Alberto Gonzales over his role in the firings of federal prosecutors in a press conference Saturday, saying that Gonzales has his "full confidence." Bush called Gonzales "an honorable and honest man" and said that "there is no credible evidence that there has been any wrongdoing. On Friday White House spokesperson Dana Perino told reporters that despite any reports to the contrary, the president has "100 percent confidence" in Gonzales. Gonzales will testify before Congress on April 17.

Gonzales defended his role in the firings on Friday, admitting that there has been some confusion but that his involvement in the matter was limited to signing off on recommendations made by his former chief of staff Kyle Sampson. Sampson, who resigned last month, told the Senate Judiciary Committee Thursday that the prosecutors were fired for political reasons rather than for poor performance as the Justice Department has claimed. Sampson also said Gonzales did more than merely follow his recommendations, and that Gonzales and former White House counsel Harriet Miers were deeply involved in the firings. On Saturday Republican Rep. Lee Terry of Nebraska joined the call for Gonzales' resignation.



Hicks could face Australian control order after release
Political and Legal | 2007/04/01 21:27

The Australian Federal Police will determine whether Guantanamo Bay military prison detainee David Hicks will be subject to a control order when released from prison later this year, members of the Australian government said Sunday. On Friday a US military commission recommended sentencing Hicks to seven years in prison; all but nine months of that were effectively suspended by a military judge under the terms of a plea agreement kept secret from the panel of military officers during its deliberations. Hicks is expected to be returned to Australia to serve his prison term within two months, after having already spent more than five years in US custody since being captured in Afghanistan.

The controversial "control orders" authorized under Australia's 2005 anti-terror legislation allow "the overt close monitoring of terrorist suspects who pose a risk to the community." The first such order was issued in August 2006 and is still undergoing an appellate court challenge. Similar orders have been called unconstitutional in the European Union. Hicks' lawyer said Sunday that he plans to return to school and will not be a threat, but Australian officials have called him "dangerous" and seek closer surveillance.



Russia bans foreign workers from retail jobs
International | 2007/04/01 20:24

A Russian law banning all foreigners from the country's retail industry took effect Sunday. The new law, passed by the Russian assembly last year, is expected to affect tens of thousands of workers from the former Soviet Republics. The complete ban follows an earlier phase out of foreign workers in the retail industry. Beginning January 15, foreigners could make up no more than 40 percent of a store's staff. Russian police began raiding stores in January and detaining any worker suspected of not being a Russian citizen.

The raids have been widely criticized by human rights and migrant organizations as only targeting non-white workers. The law was introduced last year after a period of increased unrest among migrants and citizens, including a fight in the northern town of Kondopoga between ethnic Chechens and locals which ended with two Russians dead.



Justice Dept. Levies $75M Tax Shelter Fine
Attorneys in the News | 2007/04/01 19:03

One former partner in Jenkens & Gilchrist’s Chicago office, Paul Daugerdas, earned $93 million in fees from tax shelter work, making him one of the single wealthiest participants in the tax shelter business, according to the New York Times.

Jenkens & Gilchrist, which will close its doors at the end of April, will also admit to criminal wrongdoing in the shelters, and will cooperate with the government in its continuing investigations. It was not clear whether Mr. Daugerdas and other colleagues were cooperating, the Times reports.

The agreement with Jenkens & Gilchrist is expected to assist in a wider probe of firms, including Ernst & Young, Deutsche Bank, and Sidley Austin Brown & Wood, and former tax partners with KPMG who were involved in the creation and marketing of the tax shelters.

Law firms have paid fines over the years, but have managed to avoid major damage from scandals involving their clients. Arthur Andersen was indicted in the collapse of Enron, but the company’s outside law firm, Vinson & Elkins, LLP, was not charged.

The main reason is that much of what attorneys do for their clients remains out of sight, according to Stephen Gillers, a legal-ethics professor at New York University School of Law, the Wall Street Journal reports. “Documents are kept confidential, . . . and prosecutors – have a hard time discovering potential wrongdoing by lawyers.”

But the fallout from the original Enron indictments continues. The Securities and Exchange Commission (SEC) announced last week that it is suing two former Enron corporate attorneys for participating in the massive fraud. Jordan H. Mintz, former general counsel, advised the business unit operated by Andrew Fastow, according to the Washington Post. Rex R. Rogers, also named in the suit, is former associate general counsel and a former SEC enforcement lawyer. He reviewed Enron’s public disclosures and securities filings.

The meltdown of Jenkens & Gilchrist, which numbered 600 partners in 2002, has not been as dramatic as the collapse of Andersen, but within a year of the announcement of the investigation in 2004, the firm’s revenue had fallen by 30 percent as partners left taking their clients with them. Only about200 partners remain with the firm, the Journal says.

Gerald Welch, a former Jenkens partner, said that the criminal investigation and the large number of civil lawsuits brought by investors “just became too much of a burden for them to overcome,” according to the Times.

“It became a question of the name,” he said.

A Jenkens’ spokesperson assigned blame to the Chicago office, according to a statement issued by New York prosecutors, the Times reports. “Those responsible for overseeing the Chicago tax practice placed unwarranted trust in the judgment and integrity of the attorneys principally responsible for that practice and failed to exercise effective oversight and control over the firm’s tax shelter practice.”

The firm’s Chicago office issued legal opinion letters blessing the shelters to 1,400 clients according to the IRS. It charged $50,000 apiece for these letters.



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