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A Roundup of Key Developments

Related coverage:
* Primer: Children, the Internet and Pornography (Oct. 14, 2003)
* A Closer Look at the CIPA Ruling (June 30, 2003)
* New Law Targets Internet Porn (Apr. 30, 2003)


Unsolicited junk mail seemed to be -- at times -- the nation's No. 1 gripe. There is nothing more annoying to the growing numbers of Internet users out there than discovering half, and often more, of the mail hitting their in-boxes is spam, and this year Congress heard them loud and clear. President Bush ended up receiving and signing the first federal anti-spam bill, which already is being derided as soft on spam because of the influence of direct marketers. Chief among their complaints are two items -- individuals can't sue spammers and there is no guarantee that it will create a national do-not-spam list. Its detractors also say it will blunt tough state laws that are being used to prosecute spammers. Virginia in particular was a highlight this year after indicting two men on felony spam charges. Cybersecurity researchers began realizing, meanwhile, a disturbing trend of hackers commandeering people's computers remotely in order to send out spam while covering their tracks.

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Related coverage:
* Bush Signs National Anti-Spam Law (Dec. 16, 2003)
* Va. Charges Alleged Spammer (Dec. 12, 2003)
* Spammers Target Instant Message Users (Nov. 13, 2003)
* Data Attacks Strike Spam Fighters (Nov. 3, 2003)
* Survey: Internet Users Want No-Spam List (Oct. 15, 2003)
* 'Sobig' Virus Could Be Spam Ploy (Aug. 21, 2003)


The Internet access tax moratorium and an ongoing state effort to convince Congress to let them collect online sales taxes were the most compelling stories in this area during 2003. The Internet tax ban, first enacted in 1998, did not get renewed this year after a group of senators voiced objections over its scope. Telecommunications companies and other members of the technology industry tried to get Congress to extend the ban permanently and at the same time clearly exempt high-speed DSL services from taxation, provoking several senators to claim that the ban was unfair at the state level.

State tax officials and members of the retail community tried to persuade Congress this year to allow them to collect Internet sales taxes on a widespread basis, but they now predict that they will have to wait for progress until after the 2004 presidential election. The sales tax effort did gain the ear of a bipartisan group of sympathetic Congress members who introduced legislation to give approval to the tax collection effort. The plan would let the states increase their tax collecting ability online in exchange for simplifying their tax codes.

One other item that has stayed mostly below the radar but is occupying the minds of the IT industry and tax authorities is the European Union's decision to tax all digital sales. That means that U.S. companies selling products to buyers in the EU are responsible for collecting taxes that they will have to send back to one of the union's 15 member nations. This could boost the products of some U.S. goods as much as 25 percent. The Bush administration says that the EU's move could be illegal, but has not taken an official stance yet.

Related coverage:
* Congress Fails to Act on Internet Tax Ban (Nov. 25, 2003)
* Stating the Case for Online Sales Taxes (Sept. 29, 2003)
* Internet Sales Tax May Get Amazon.com's Support (Sept. 25, 2003)
* EU Stirs Up Internet Sales Tax Debate (June 9, 2003)
* Big Stores To Charge Sales Taxes Online (Feb. 7, 2003)

Web Radio

The vociferous debate over royalties that small commercial webcasters should pay to stream music via the Internet spilled into 2003, despite President Bush signing an Internet radio law in Dec. 2002 that was supposed to resolve the issue. The law says that music copyright owners must negotiate royalty deals directly with Internet radio stations, but small webcasters complained that the rates offered by record companies were designed to drive them out of business. In August, the a coalition of small- and mid-sized webcasters sued the RIAA for antitrust violations over its royalty offerings. Meanwhile, a bill designed to replace the existing apparatus for setting royalties saw some movement in the House of Representatives, passing the Judiciary Committee in September.

Related coverage:
* Net Radio Group Threatens to Sue RIAA (July 9, 2003)
* Net Radio Debate Simmers Despite Deals (June 5, 2003)

Wireless Number Portability

Few technology developments were more cause for celebration in America this year than the FCC's decision that people in the 100 largest U.S. markets should be allowed to keep their phone number when they switch from one mobile phone company to another or get rid of their landline phone in favor of a cellphone. Most of the companies tried to get the courts to overturn the FCC's order, claiming that it would be too expensive and difficult to achieve, but the FCC won its case in the end. Switching requests flooded the wireless phone companies in the first few days after the rule took effect, and there are several notable stories of people who wound up in the proverbial "phone hell," but the number of reported complaints seems to be fairly low so far compared to the number of cellphone switches.

Related coverage:
* Not Switched But Still on Hold (Dec. 12, 2003)
* Court Allows Number Switch (Nov. 22, 2003)
* Selling the Switch (Nov. 22, 2003)

Compiled by Staff Writers Robert MacMillan and David McGuire.

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