According to sources, former top Yahoo exec Hilary Schneider will be named president of LifeLock, which offers theft and fraud protection services to individual consumers and businesses.

The move — which is set to be announced soon, said sources — is an interesting one on a lot of levels.

First, the Tempe, Arizona-based LifeLock has just filed to go public at the end of August on the New York Stock Exchange under the ticker “LOCK.” The company — which is backed by Bessemer Venture Partners and Kleiner Perkins — seeks to raise $175 million in its IPO.

Obviously, bringing in Schneider adds an experienced public company exec to the team, which is headed by CEO and Chairman Todd Davis.

Perhaps more interestingly, it that it is a major shift in focus for Schneider — who left Yahoo in 2010 and has since been doing consulting work with TPG Capital on a wide range of digital companies.

She has largely been focused on online advertising in her career and was much recruited for a range of such opportunities after departing Yahoo. Instead, she chose to work at TPG, where she actually helped the powerful private equity firm think through a possible bid for Yahoo at one point.

Schneider left Yahoo after clashing with then-CEO Carol Bartz — Bartz was later fired — over a range of issues at the Silicon Valley Internet giant. Schneider had headed media and advertising sales there for its key U.S. division.

Before Yahoo, Schneider was a top exec at media giant Knight Ridder and, earlier, was CEO of Red Herring Communications and also CEO of Times Mirror Interactive. The Harvard Business School grad started her media career at the Baltimore Sun.

I am awaiting comment from LifeLock on the pending appointment.

Nabbing electronic devices isn’t new. But lately it is growing “exponentially” according to a 2011 report from the New York Police Department. The lucrative secondhand market for today’s niftiest handsets has produced an explosion in “Apple picking” by thieves. A used iPad or iPhone can fetch more than $400.

How big is the iCrime wave? National data aren’t available, but in New York, there were more than 26,000 incidents of electronics theft in the first 10 months of 2011 — 81% involving mobile phones — according to an internal police-department document.

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The database, which the wireless companies will build and maintain, will be designed to track phones that are reported as lost or stolen and deny them voice and data service. The idea is to reduce crime by making it difficult or impossible to actually use a stolen device, reducing resale value.

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A month ago, I posted an initial list of speakers for the 10th D: All Things Digital conference.

After a decade, the event — which is held in Rancho Palos Verdes, Calif., just south of Los Angeles, at the end of May — has attracted another amazing group of speakers, including: New York City Mayor Michael Bloomberg; serial entrepreneur Sean Parker, who will appear with Spotify co-founder and CEO Daniel Ek; Zynga founder and CEO Mark Pincus; Federal Trade Commission Chairman Jon Leibowitz; LinkedIn Chairman and VC Reid Hoffman, who will appear with the social business site’s CEO Jeff Weiner; and Skype CEO Tony Bates.

Now, here’s another group of stellar speakers we’ve added to the programming lineup (and there are still even more big names to come in the weeks ahead): Oracle CEO Larry Ellison; former tech analyst superstar and now VC Mary Meeker of Kleiner Perkins; Intellectual Ventures’ Nathan Myhrvold; Pixar co-founder and Disney animation head Dr. Ed Catmull; and Visa President John Partridge.

Larry Ellison, CEO and founder of the enterprise giant Oracle, needs little introduction, as one of tech’s highest profile figures and a true Silicon Valley icon. Frankly, I think the short bio that’s on Oracle’s Web site says it all: “Larry Ellison has been CEO of Oracle Corporation since he founded the company in 1977. He also races sailboats, flies planes, and plays tennis and guitar.” There will be a lot to talk about with the voluble and always entertaining exec — who appeared at the D conference once before many years ago — from the current state of the tech industry to insights to where it’s all going. (In addition, Ellison has agreed to appear on a panel we are doing as a tribute to his close friend, Apple’s former CEO Steve Jobs.)

Another well-known tech figure is Meeker, who is now a partner at Kleiner Perkins Caufield & Byers, having joined the storied venture capital firm in early 2011. She focuses there on investments in its digital practice and via KP’s Digital Growth Fund, working with companies such as Spotify, Jawbone and One King’s Lane. But Meeker is perhaps best known for her long stint — 1991 to 2010 — as a star Internet research analyst at Morgan Stanley, where she brought many of the Internet’s great companies to the attention of Wall Street and beyond. She also wrote a series of groundbreaking reports on the landscape. That includes her annual “State of the Internet,” which Meeker will debut this year at the conference in an extended demo of her always riveting Internet trends presentation.

Nathan Myhrvold is also a tech legend, having worked for 14 years as chief strategist and CTO of Microsoft. But, instead of retiring, the avid inventor decided to focus on patents, founding and leading a controversial company called Intellectual Ventures, which buys them up and licenses them out (or sues if it doesn’t sell). With all the mishegas around patents right now, it’s a good time to have Myhrvold back to explain it all and perhaps to take some of the blame for the explosion in intellectual property lawsuits. (Myhrvold also co-authored a cookbook, “Modernist Cuisine,” so we hope we will also get some sort of futuristic cooking demo. Perhaps, Patently Delicious Flan?)

Speaking of tasty, the animation from Pixar over the years has been just that and it’s been one of Disney’s greatest acquisitions. Given how much Pixar has contributed to animation technology, we are glad to finally get Dr. Ed Catmull onstage. As co-founder of Pixar Animation Studios and president of Walt Disney and Pixar Animation Studios, he will discuss where entertainment and technology are intersecting and where they are not. Catmull is a geek’s geek in the industry — having also founded the computer graphics laboratory at the New York Institute of Technology, the computer division of Lucasfilm, as well as Pixar, which he did with chief creative officer John Lasseter. Get ready to talk about image compositing, motion blur, subdivision surfaces, cloth simulation and rendering techniques, texture mapping and the z-buffer. Also, Catmull’s five Academy Awards.

Lastly, it is perfect timing for bringing on John Partridge, president of Visa. With swirling issues around online identity theft, digital privacy, the future of money and the rise of upstart competitors such as Square, Partridge has his hands full at the credit card giant. One of the most neglected arenas in tech, the way we manage payments is perhaps the biggest story of the next era, especially as it relates to mobile and the rise of smartphones as all-purpose devices.

Ahead of the dinner, Anderson stopped by my office to let me have a peek at his 10 predictions, and we talked them over a bit. All 10 are below, along with some comments from Anderson that emerged from our conversation.

Before diving into the predictions, Anderson tells me there is a grand theme that unifies them all: “Integrating everything.”

What does that mean? “It means a whole lot of stuff that needs to be integrated. We don’t need anything new at all. There’s so much work that needs to be done with the existing tool sets. Steve Jobs didn’t really invent anything at all. But he was great at integrating things into a product. There’s a lot more of that work to do. We have to do it in the phone world and the TV world and the health care world. We have lots of devices and lots of chips and lots of operating systems and lots of content. The bigger question is, how do human beings use it all efficiently?”

As an example, he cites the collaboration between Nuance, the speech software company, and IBM, bringing the Watson computer of “Jeopardy” fame into the area of health care. “For the first time, the idea of evidence-based medicine won’t just be in a magazine article,” Anderson says. “A doctor will be able to pick up his phone and describe four symptoms, and find out what the likely diagnosis is, what the indications are. It’s fantastic.”

So here are those 10 predictions, with additional comments from Anderson:

1. TV becomes the new center of gravity in the tech universe. All the other devices find their niches in the TV galaxy. Microsoft’s attempt to integrate Kinect into TV is a strong if qualified success. Smart phone-TV integration software becomes a new category. Pad-TV integration becomes common.

“Apple will hustle to launch the next version of Apple TV, and it will be a roaring success and be seen as Tim Cook’s first great product success. But what it really will be is Steve’s last product.”

2. 2012 will see tectonic shifts in phone markets. “Nokia will fail to come back, which is pretty clear to everyone except the people in Finland.” Samsung, Anderson says, will retain its spot as the new global leader in mobile phones by volume, and will keep this crown despite the debut of Microsoft’s Windows Phone 7.

Meanwhile, Anderson says, Google will lose control over the Android operating system, mainly because unlicensed versions of Android will multiply in type and in installed base, especially in Asian countries. “It’s already a balkanized environment. Now Google loses control of the technology entirely. China is already running an unlicensed version of Android, and I think there will be more of that.”

Finally, the smartphone will finally emerge as the dominant category of wireless phone. “Why would you have anything else? And why would sellers of content and services want you to?” he says. “It doesn’t matter if you’re in a rich country or a poor country. This stuff is cheap.”

3. Clouds are for consumers, and for start-ups. Even as a large number of big companies move pilot projects onto external clouds, it will become clear that the real trend is for enterprise to stay away from clouds in all key areas, for reasons of both security and reliability.

“The cloud guys hate this because they want to sell to enterprises,” Anderson says. “But the security issues are becoming really intense. If you’re a CIO, it’s a terrible environment, and you’re a target, for sure, especially if you’re a company with a lot of intellectual property. I’m not implying that things like SAAS (software as a service) aren’t a big trend. But no one is going to put their valuable IP on the cloud.”

4. Security splits the tech world in two, finally getting attention from CEOs. Companies with real IP start to realize they have to “go big or go home” with their security response, and their spending on protecting their “crown jewels” rises dramatically.

5. Siri stuns the world. Siri, on Apple’s iPhone 4S, has sounded the arrival of Internet personal assistants, and the world will spend this year marveling at what Siri and its rivals can and cannot do — and what they can learn to do.

“I think we’ll see a bunch of these things,” Anderson says. “Siri will get much better. It will learn how you learn. We’ve never seen people have long-term relationships with machines before, but it will be a long-term relationship, and she will remember everything, but make good use of it. She will know you learn better by seeing than hearing, or that it takes three times to tell you something. All those things that you have to program today should be learnable. None of that has been done yet. That creates a real friendship. And I think we’re going to start seeing personal assistants not just for everyday life, but for professions like medicine or car repair. Instead of just having Siri be everything, there will be many Siris for different contexts.”

6. We enter the amazing world of Dave and HAL, as voice recognition comes of age. From hospital to car, mobile to home, Kinect to Siri, exercise to play, work to entertainment, remote control to direct action, from Microsoft to Apple, from Tellme to Nuance — the time has come for computers and humans to talk to each other. With lots of funny stories, big bloopers and amazing breakthroughs, humanity at the end of 2012 will be talking to machines in a normal voice, and it will not seem unusual, nor be the cause of unending frustration.

“The voice-recognition part is almost trivial,” Anderson says. “The important part is context-sensitive understanding. It used to be that all the researchers at Carnegie Mellon used to think that all you needed was more computing horsepower to do better at voice. It turned out that was wrong. It was right for a little while, but the real problem is context. And so, if you can build up that database where you can search it contextually for what to expect, that is where you get all the mileage.”

7. E-readers prosper, but pads continue to dominate what Anderson calls the “carry-along” market. Pads and tablets will come down in price and get closer to prices of e-readers. Meanwhile, Anderson says, Amazon’s Fire will move upmarket and evolve into a full-fledged tablet.

“If you look at the specs on the Fire, it’s a tablet, but it’s hobbled,” Anderson says. “So I think that this is part of the whole strategy: Come in and sell at a low price, and then later unveil a more complete tablet. Apple will stay ahead, though. A lot of people are asking me if Amazon will catch Apple, and the answer is no. The way it’s configured right now, there’s no way the Fire will catch up with the iPad.”

8. The consumption world explodes. Get ready for new devices, new content, new bundles, new connection techniques, new distribution channels, new aggregators, new tablets, new phones, new players, new self-published authors, new garage bands, new consumption models riding on social networks. There is nothing but high energy in the content consumer market. People are now ready to spend subscription money, and the publisher response will be huge. “It’s going to be a huge melee of stuff,” Anderson says. “We’ll invent more stuff to consume, and it will be very hard to figure out who the players are from week to week, and how they’re doing. They may not even know themselves.”

9. Governments and corporations focus on intellectual property as though it were their most prized asset. It is. This new global understanding leads to a reevaluation regarding giving critical IP away for nothing versus protecting it. The age of what Anderson calls “IP naïveté” is over, and the question of proper IP valuation is here.

What is IP naïveté? “When Jeff Immelt stood on the steps of the White House the day after he was named jobs czar, and handed the plans for GE’s most important jet-engine project to Hu Jintao in order to get the permission to be allowed to bid on maybe selling engines to China — that’s IP naïveté,” Anderson says. “Thinking that’s not going to come back and show up for sale in Houston from some Chinese company in about six months is IP naïveté.”

During 2012, he says, companies and countries will start valuing their intellectual property not for its replacement value, but for figures that are magnitudes larger. State-sponsored IP theft will shift from being considered a nuisance and more along the lines of an act of aggression.

10. Amazon gets it all. Between outdoing Wal-Mart online, to beating the booksellers and delivering groceries, and making new inroads in video streaming, Amazon will prove that one company can indeed have it all. Strong Kindle and Fire sales will only be icing on the cake.

I am in the market for an iPad, but have been advised to wait for the iPad 3, which rumors suggest will be arriving shortly. What do you advise?

A:

I have seen similar rumors, but I have no confirmation of them and no information on the timing or details of the next iPad. If I had to guess, I’d guess the next iPad will be announced in March or April, which is when the last two were announced.

Q:

I would like to purchase a laptop for use only with my stock brokerage firm, my mutual-fund company, my bank and my local credit union. No email, music, photos, games, surfing the Web, online purchases, video chat, etc. I think this will cut down greatly on the chances of my financial information being stolen. Am I mistaken?

A:

This approach might help, but I believe you may be overestimating its benefits. You have to go online, via a Web browser, to perform financial transactions, and you will have to use email in order to do things like confirm sign-up information. Once you are using a Web browser and email, you are open to identity theft if you are careless. Obviously, avoiding any website or online activity where malware or spyware might lurk will help, but you’d still need to be very careful, and—especially if it’s a Windows PC—to install strong security software.

Email Mossberg’s Mailbox at mossberg@wsj.com.

The heavily backed San Francisco start-up came under fire a couple of weeks ago after one customer’s horror story spread rapidly across the Internet.

Ever since then, it’s been apologizing and working round the clock to roll out new security features.

Brian Chesky, the CEO and co-founder, tells me that so far he’s gotten 3,000 emails since posting his email address (brian.chesky@airbnb.com) on the site for any customers to contact him, and that engineers have been working past midnight and spending the night in the office to get new features completed quickly.

Most of the improvements are a direct response to the outcry, while only a few of them were already in the company’s pipeline.

“We realized that as we were entering the mainstream, there were a few opportunities to tighten up the platform,” Chesky said.

Today, it concluded work on a couple of major features, such as the $50,000 Host Guarantee, which means hosts will be reimbursed for property damage or theft and vandalism. Last week, the company also started providing 24-hour customer support using 100-plus agents in 18 countries working in multiple time zones.

It also launched Airbnb VoiceConnect, which allows people to make phone calls to one another without ever disclosing their real phone number. Privacy continues to be one of the company’s mantras, but that’s bending as users press to see a person’s real identity before conducting a transaction of this kind.

The need to make better security decisions in the future is also at the core of two hires. Airbnb has brought aboard Command Consulting Group, which will be reviewing the company’s practices and making recommendations, and hired Monroe Labouisse, who will be director of customer support after spending a decade at eBay and PayPal.

All of today’s improvements were outlined in a blog post today.

The guarantee will be retroactive and will definitely apply to EJ, the woman who chronicled her devastating story in a blog about how her San Francisco apartment was ransacked after she rented it to people via Airbnb.

The Airbnb Guarantee will allow hosts who believe their property was damaged or stolen during a stay to request funds from the company. Hosts can submit a request online, which will be examined by the customer service team. Airbnb will also have third parties that can go to the property to conduct an inspection if possible, and then a decision will be made.

The coverage will run alongside that of other insurance companies, meaning that if a person is refunded for his or her losses by another company, then the Airbnb Guarantee will not be necessary. The company still is recommending that hosts have insurance, and stresses that its guarantee does not replace it.

Chesky and Labouisse, who officially started at the company today, said that a number of previous customers have already reached out to inquire about the guarantee, but declined to disclose a specific number.

At $50,000, the guarantee is high enough that it signals to customers that Airbnb is serious about security and now has an incentive to make sure it is secure for all parties involved. Likewise, by making it retroactive, it means that it’s not just confident about its future, but also about most of the stays it has helped to mediate in the past.

This year, there were 311 grand larcenies on the subway through the end of March, an 18 percent increase over the same period in 2010, according to police statistics.

That jump is largely driven by the increasing theft of smartphones, especially Apple’s iPhone 4, said Raymond Diaz, chief of the New York City Police Department’s transit bureau.

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Thirteen to 15 masked thieves took part in the Feb. 27 robbery at Unigen Corp., a closely held company known for making devices called memory modules and manufacturing products for other companies.

The chips had been expected to be used in building products for Google Inc., said Mike Sterner, director of a task force of local, state and federal officials that has been investigating the theft.

Five suspects have been arrested and 98% of the stolen chips were recovered, officials said.

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Yesterday, in a major policy speech in Washington, D.C., Secretary of State Hillary Clinton jumped on the Internet bandwagon again, unveiling a $25 million government investment for entrepreneurs to allow dissidents to thwart “thugs, hackers and censors.”

Since that’s about the amount a third-string social photo-sharing site gets while walking down University Avenue in Palo Alto, Calif., from venture capitalists with bags of money to spend, let me just say the money is, well, underwhelming.

Luckily, Clinton’s speech–the latest chapter of the Obama administration’s “Internet Freedom Agenda”–was much better.

In fact, it was a sobering look at the situation, replete with all its conflicts and compromises, including some related to the State Department of late (hello, WikiLeaks!).

While more of a gimmick, Clinton outlined what she called a “venture capital-style approach” to stopping governments from closing down digital communications platforms.

In Egypt, that has included the whole dang Internet after times got tough and protesters tweeted too much.

Even still, said Clinton, such efforts–however effective now–were ultimately useless.

“Those who clamp down on Internet freedom may be able to hold back the full expression of their people’s yearnings for a while, but not forever,” she said.

Still, even though Facebook and Twitter have been lauded as critical tools in the reform protests in the Mideast, those Luddite strongmen did manage to put up a very good fight in shutting them down.

But Clinton advocated pressing on. Along with the seed funding for firewall-piercing and evading technologies, she also announced the creation of a new coordinator for cyber issues and the fact that the State Department had just begun to tweet in Arabic and Farsi and would soon be doing so in Chinese, Hindi and Russian.

All very nice steps, but the overall arrival of the long-promised global “strategy for cyberspace,” which has gotten bogged down in politics, is still to come.

In fact, a GOP-fueled criticism of the State Department was also released yesterday, designed to muck up Clinton’s speech, about how another $30 million in digital investments was being spent or, more precisely, being spent badly.

Clinton answered critics:

“Some have criticized us for not pouring funding into a single technology–but there is no silver bullet in the struggle against Internet repression. There’s no ‘app’ for that.”

Well, actually, since there is an app that turns your Apple iPhone into a hand massager, there certainly should be.

Speaking of that, Clinton was deft at dealing with the obvious delta between pressing for Internet freedom, even as U.S. government lawyers were whacking away at WikiLeaks–and, by association, Twitter itself.

Clinton noted the release of a mass of classified State Department documents “began with an act of theft,” arguing that this was the real issue.

She went on to further argue:

“I said that the WikiLeaks incident began with a theft, just as if it had been executed by smuggling papers in a briefcase. The fact that WikiLeaks used the Internet is not the reason we criticized its actions. WikiLeaks does not challenge our commitment to Internet freedom.”

Actually, the issue is that the Internet, once it really gets going, doesn’t really want to be controlled by anyone.

Kind of like humanity.

Or as Clinton so correctly noted about the various protests taking place abroad:

“In each case, people protested because of deep frustrations with the political and economic conditions of their lives. They stood and marched and chanted and the authorities tracked and blocked and arrested them. The Internet did not do any of those things; people did.”

In any case, judge for yourself: Here’s the video of the speech at George Washington University from the State Department’s Web site, as well as the full text below:

Thank you all very much and good afternoon. It is a pleasure, once again, to be back on the campus of the George Washington University, a place that I have spent quite a bit of time in all different settings over the last now nearly 20 years. I’d like especially to thank President Knapp and Provost Lerman, because this is a great opportunity for me to address such a significant issue, and one which deserves the attention of citizens, governments, and I know is drawing that attention. And perhaps today in my remarks, we can begin a much more vigorous debate that will respond to the needs that we have been watching in real time on our television sets.

A few minutes after midnight on January 28th, the Internet went dark across Egypt. During the previous four days, hundreds of thousands of Egyptians had marched to demand a new government. And the world, on TVs, laptops, cell phones, and smart phones, had followed every single step. Pictures and videos from Egypt flooded the web. On Facebook and Twitter, journalists posted on-the-spot reports. Protestors coordinated their next moves. And citizens of all stripes shared their hopes and fears about this pivotal moment in the history of their country.

Millions worldwide answered in real time, “You are not alone and we are with you.” Then the government pulled the plug. Cell phone service was cut off, TV satellite signals were jammed, and Internet access was blocked for nearly the entire population. The government did not want the people to communicate with each other and it did not want the press to communicate with the public. It certainly did not want the world to watch.

The events in Egypt recalled another protest movement 18 months earlier in Iran, when thousands marched after disputed elections. Their protestors also used websites to organize. A video taken by cell phone showed a young woman named Neda killed by a member of the paramilitary forces, and within hours, that video was being watched by people everywhere.

The Iranian authorities used technology as well. The Revolutionary Guard stalked members of the Green Movement by tracking their online profiles. And like Egypt, for a time, the government shut down the internet and mobile networks altogether. After the authorities raided homes, attacked university dorms, made mass arrests, tortured and fired shots into crowds, the protests ended.

In Egypt, however, the story ended differently. The protests continued despite the internet shutdown. People organized marches through flyers and word of mouth and used dial-up modems and fax machines to communicate with the world. After five days, the government relented and Egypt came back online. The authorities then sought to use the Internet to control the protests by ordering mobile companies to send out pro-government text messages, and by arresting bloggers and those who organized the protests online. But 18 days after the protests began, the government failed and the president resigned.

What happened in Egypt and what happened in Iran, which this week is once again using violence against protestors seeking basic freedoms, was about a great deal more than the internet. In each case, people protested because of deep frustrations with the political and economic conditions of their lives. They stood and marched and chanted and the authorities tracked and blocked and arrested them. The Internet did not do any of those things; people did. In both of these countries, the ways that citizens and the authorities used the Internet reflected the power of connection technologies on the one hand as an accelerant of political, social, and economic change, and on the other hand as a means to stifle or extinguish that change.

There is a debate currently underway in some circles about whether the Internet is a force for liberation or repression. But I think that debate is largely beside the point. Egypt isn’t inspiring people because they communicated using Twitter. It is inspiring because people came together and persisted in demanding a better future. Iran isn’t awful because the authorities used Facebook to shadow and capture members of the opposition. Iran is awful because it is a government that routinely violates the rights of its people.

So it is our values that cause these actions to inspire or outrage us, our sense of human dignity, the rights that flow from it, and the principles that ground it. And it is these values that ought to drive us to think about the road ahead. Two billion people are now online, nearly a third of humankind. We hail from every corner of the world, live under every form of government, and subscribe to every system of beliefs. And increasingly, we are turning to the Internet to conduct important aspects of our lives.

The Internet has become the public space of the 21st century–the world’s town square, classroom, marketplace, coffeehouse, and nightclub. We all shape and are shaped by what happens there, all 2 billion of us and counting. And that presents a challenge. To maintain an Internet that delivers the greatest possible benefits to the world, we need to have a serious conversation about the principles that will guide us, what rules exist and should not exist and why, what behaviors should be encouraged or discouraged and how.

The goal is not to tell people how to use the Internet any more than we ought to tell people how to use any public square, whether it’s Tahrir Square or Times Square. The value of these spaces derives from the variety of activities people can pursue in them, from holding a rally to selling their vegetables, to having a private conversation. These spaces provide an open platform, and so does the Internet. It does not serve any particular agenda, and it never should. But if people around the world are going come together every day online and have a safe and productive experience, we need a shared vision to guide us.

One year ago, I offered a starting point for that vision by calling for a global commitment to Internet freedom, to protect human rights online as we do offline. The rights of individuals to express their views freely, petition their leaders, worship according to their beliefs–these rights are universal, whether they are exercised in a public square or on an individual blog. The freedoms to assemble and associate also apply in cyberspace. In our time, people are as likely to come together to pursue common interests online as in a church or a labor hall.

Together, the freedoms of expression, assembly, and association online comprise what I’ve called the freedom to connect. The United States supports this freedom for people everywhere, and we have called on other nations to do the same. Because we want people to have the chance to exercise this freedom. We also support expanding the number of people who have access to the Internet. And because the Internet must work evenly and reliably for it to have value, we support the multi-stakeholder system that governs the internet today, which has consistently kept it up and running through all manner of interruptions across networks, borders, and regions.

In the year since my speech, people worldwide have continued to use the Internet to solve shared problems and expose public corruption, from the people in Russia who tracked wildfires online and organized a volunteer firefighting squad, to the children in Syria who used Facebook to reveal abuse by their teachers, to the Internet campaign in China that helps parents find their missing children.

At the same time, the Internet continues to be restrained in a myriad of ways. In China, the government censors content and redirects search requests to error pages. In Burma, independent news sites have been taken down with distributed denial of service attacks. In Cuba, the government is trying to create a national intranet, while not allowing their citizens to access the global internet. In Vietnam, bloggers who criticize the government are arrested and abused. In Iran, the authorities block opposition and media websites, target social media, and steal identifying information about their own people in order to hunt them down.

These actions reflect a landscape that is complex and combustible, and sure to become more so in the coming years as billions of more people connect to the Internet. The choices we make today will determine what the Internet looks like in the future. Businesses have to choose whether and how to enter markets where internet freedom is limited. People have to choose how to act online, what information to share and with whom, which ideas to voice and how to voice them. Governments have to choose to live up to their commitments to protect free expression, assembly, and association.

For the United States, the choice is clear. On the spectrum of Internet freedom, we place ourselves on the side of openness. Now, we recognize that an open Internet comes with challenges. It calls for ground rules to protect against wrongdoing and harm. And Internet freedom raises tensions, like all freedoms do. But we believe the benefits far exceed the costs.

And today, I’d like to discuss several of the challenges we must confront as we seek to protect and defend a free and open Internet. Now, I’m the first to say that neither I nor the United States Government has all the answers. We’re not sure we have all the questions. But we are committed to asking the questions, to helping lead a conversation, and to defending not just universal principles but the interests of our people and our partners.

The first challenge is achieving both liberty and security. Liberty and security are often presented as equal and opposite; the more you have of one, the less you have of the other. In fact, I believe they make it each other possible. Without security, liberty is fragile. Without liberty, security is oppressive. The challenge is finding the proper measure: enough security to enable our freedoms, but not so much or so little as to endanger them.

Finding this proper measure for the Internet is critical because the qualities that make the internet a force for unprecedented progress–its openness, its leveling effect, its reach and speed–also enable wrongdoing on an unprecedented scale. Terrorists and extremist groups use the Internet to recruit members, and plot and carry out attacks. Human traffickers use the Internet to find and lure new victims into modern-day slavery. Child pornographers use the Internet to exploit children. Hackers break into financial institutions, cell phone networks, and personal email accounts.

So we need successful strategies for combating these threats and more without constricting the openness that is the Internet’s greatest attribute. The United States is aggressively tracking and deterring criminals and terrorists online. We are investing in our nation’s cyber-security, both to prevent cyber-incidents and to lessen their impact. We are cooperating with other countries to fight transnational crime in cyberspace. The United States Government invests in helping other nations build their own law enforcement capacity. We have also ratified the Budapest Cybercrime Convention, which sets out the steps countries must take to ensure that the internet is not misused by criminals and terrorists while still protecting the liberties of our own citizens.

In our vigorous effort to prevent attacks or apprehend criminals, we retain a commitment to human rights and fundamental freedoms. The United States is determined to stop terrorism and criminal activity online and offline, and in both spheres we are committed to pursuing these goals in accordance with our laws and values.

Now, others have taken a different approach. Security is often invoked as a justification for harsh crackdowns on freedom. Now, this tactic is not new to the digital age, but it has new resonance as the internet has given governments new capacities for tracking and punishing human rights advocates and political dissidents. Governments that arrest bloggers, pry into the peaceful activities of their citizens, and limit their access to the Internet may claim to be seeking security. In fact, they may even mean it as they define it. But they are taking the wrong path. Those who clamp down on Internet freedom may be able to hold back the full expression of their people’s yearnings for a while, but not forever.

The second challenge is protecting both transparency and confidentiality. The Internet’s strong culture of transparency derives from its power to make information of all kinds available instantly. But in addition to being a public space, the Internet is also a channel for private communications. And for that to continue, there must be protection for confidential communication online. Think of all the ways in which people and organizations rely on confidential communications to do their jobs. Businesses hold confidential conversations when they’re developing new products to stay ahead of their competitors. Journalists keep the details of some sources confidential to protect them from exposure or retribution. And governments also rely on confidential communication online as well as offline. The existence of connection technologies may make it harder to maintain confidentiality, but it does not alter the need for it.

Now, I know that government confidentiality has been a topic of debate during the past few months because of WikiLeaks, but it’s been a false debate in many ways. Fundamentally, the WikiLeaks incident began with an act of theft. Government documents were stolen, just the same as if they had been smuggled out in a briefcase. Some have suggested that this theft was justified because governments have a responsibility to conduct all of our work out in the open in the full view of our citizens. I respectfully disagree. The United States could neither provide for our citizens’ security nor promote the cause of human rights and democracy around the world if we had to make public every step of our efforts. Confidential communication gives our government the opportunity to do work that could not be done otherwise.

Consider our work with former Soviet states to secure loose nuclear material. By keeping the details confidential, we make it less likely that terrorists or criminals will find the nuclear material and steal it for their own purposes. Or consider the content of the documents that WikiLeaks made public. Without commenting on the authenticity of any particular documents, we can observe that many of the cables released by WikiLeaks relate to human rights work carried on around the world. Our diplomats closely collaborate with activists, journalists, and citizens to challenge the misdeeds of oppressive governments. It is dangerous work. By publishing diplomatic cables, WikiLeaks exposed people to even greater risk.

For operations like these, confidentiality is essential, especially in the Internet age when dangerous information can be sent around the world with the click of a keystroke. But of course, governments also have a duty to be transparent. We govern with the consent of the people, and that consent must be informed to be meaningful. So we must be judicious about when we close off our work to the public, and we must review our standards frequently to make sure they are rigorous. In the United States, we have laws designed to ensure that the government makes its work open to the people, and the Obama Administration has also launched an unprecedented initiative to put government data online, to encourage citizen participation, and to generally increase the openness of government.

The U.S. Government’s ability to protect America, to secure the liberties of our people, and to support the rights and freedoms of others around the world depends on maintaining a balance between what’s public and what should and must remain out of the public domain. The scale should and will always be tipped in favor of openness, but tipping the scale over completely serves no one’s interests. Let me be clear. I said that the WikiLeaks incident began with a theft, just as if it had been executed by smuggling papers in a briefcase. The fact that WikiLeaks used the Internet is not the reason we criticized its actions. WikiLeaks does not challenge our commitment to Internet freedom.

And one final word on this matter: There were reports in the days following these leaks that the United States Government intervened to coerce private companies to deny service to WikiLeaks. That is not the case. Now, some politicians and pundits publicly called for companies to disassociate from WikiLeaks, while others criticized them for doing so. Public officials are part of our country’s public debates, but there is a line between expressing views and coercing conduct. Business decisions that private companies may have taken to enforce their own values or policies regarding WikiLeaks were not at the direction of the Obama Administration.

A third challenge is protecting free expression while fostering tolerance and civility. I don’t need to tell this audience that the Internet is home to every kind of speech–false, offensive, incendiary, innovative, truthful, and beautiful.

The multitude of opinions and ideas that crowd the Internet is both a result of its openness and a reflection of our human diversity. Online, everyone has a voice. And the Universal Declaration of Human Rights protects the freedom of expression for all. But what we say has consequences. Hateful or defamatory words can inflame hostilities, deepen divisions, and provoke violence. On the Internet, this power is heightened. Intolerant speech is often amplified and impossible to retract. Of course, the Internet also provides a unique space for people to bridge their differences and build trust and understanding.

Some take the view that, to encourage tolerance, some hateful ideas must be silenced by governments. We believe that efforts to curb the content of speech rarely succeed and often become an excuse to violate freedom of expression. Instead, as it has historically been proven time and time again, the better answer to offensive speech is more speech. People can and should speak out against intolerance and hatred. By exposing ideas to debate, those with merit tend to be strengthened, while weak and false ideas tend to fade away; perhaps not instantly, but eventually.

Now, this approach does not immediately discredit every hateful idea or convince every bigot to reverse his thinking. But we have determined as a society that it is far more effective than any other alternative approach. Deleting writing, blocking content, arresting speakers–these actions suppress words, but they do not touch the underlying ideas. They simply drive people with those ideas to the fringes, where their convictions can deepen, unchallenged.

Last summer, Hannah Rosenthal, the U.S. Special Envoy to Monitor and Combat Anti-Semitism, made a trip to Dachau and Auschwitz with a delegation of American imams and Muslim leaders. Many of them had previously denied the Holocaust, and none of them had ever denounced Holocaust denial. But by visiting the concentration camps, they displayed a willingness to consider a different view. And the trip had a real impact. They prayed together, and they signed messages of peace, and many of those messages in the visitors books were written in Arabic. At the end of the trip, they read a statement that they wrote and signed together condemning without reservation Holocaust denial and all other forms of anti-Semitism.

The marketplace of ideas worked. Now, these leaders had not been arrested for their previous stance or ordered to remain silent. Their mosques were not shut down. The state did not compel them with force. Others appealed to them with facts. And their speech was dealt with through the speech of others.

The United States does restrict certain kinds of speech in accordance with the rule of law and our international obligations. We have rules about libel and slander, defamation, and speech that incites imminent violence. But we enforce these rules transparently, and citizens have the right to appeal how they are applied. And we don’t restrict speech even if the majority of people find it offensive. History, after all, is full of examples of ideas that were banned for reasons that we now see as wrong. People were punished for denying the divine right of kings, or suggesting that people should be treated equally regardless of race, gender, or religion. These restrictions might have reflected the dominant view at the time, and variations on these restrictions are still in force in places around the world.

But when it comes to online speech, the United States has chosen not to depart from our time-tested principles. We urge our people to speak with civility, to recognize the power and reach that their words can have online. We’ve seen in our own country tragic examples of how online bullying can have terrible consequences. Those of us in government should lead by example, in the tone we set and the ideas we champion. But leadership also means empowering people to make their own choices, rather than intervening and taking those choices away. We protect free speech with the force of law, and we appeal to the force of reason to win out over hate.

Now, these three large principles are not always easy to advance at once. They raise tensions, and they pose challenges. But we do not have to choose among them. Liberty and security, transparency and confidentiality, freedom of expression and tolerance–these all make up the foundation of a free, open, and secure society as well as a free, open, and secure internet where universal human rights are respected, and which provides a space for greater progress and prosperity over the long run.

Now, some countries are trying a different approach, abridging rights online and working to erect permanent walls between different activities–economic exchanges, political discussions, religious expressions, and social interactions. They want to keep what they like and suppress what they don’t. But this is no easy task. Search engines connect businesses to new customers, and they also attract users because they deliver and organize news and information. Social networking sites aren’t only places where friends share photos; they also share political views and build support for social causes or reach out to professional contacts to collaborate on new business opportunities.

Walls that divide the Internet, that block political content, or ban broad categories of expression, or allow certain forms of peaceful assembly but prohibit others, or intimidate people from expressing their ideas are far easier to erect than to maintain. Not just because people using human ingenuity find ways around them and through them but because there isn’t an economic Internet and a social Internet and a political Internet; there’s just the Internet. And maintaining barriers that attempt to change this reality entails a variety of costs–moral, political, and economic. Countries may be able to absorb these costs for a time, but we believe they are unsustainable in the long run. There are opportunity costs for trying to be open for business but closed for free expression–costs to a nation’s education system, its political stability, its social mobility, and its economic potential.

When countries curtail Internet freedom, they place limits on their economic future. Their young people don’t have full access to the conversations and debates happening in the world or exposure to the kind of free inquiry that spurs people to question old ways of doing and invent new ones. And barring criticism of officials makes governments more susceptible to corruption, which create economic distortions with long-term effects. Freedom of thought and the level playing field made possible by the rule of law are part of what fuels innovation economies.

So it;s not surprising that the European-American Business Council, a group of more than 70 companies, made a strong public support statement last week for Internet freedom. If you invest in countries with aggressive censorship and surveillance policies, your website could be shut down without warning, your servers hacked by the government, your designs stolen, or your staff threatened with arrest or expulsion for failing to comply with a politically motivated order. The risks to your bottom line and to your integrity will at some point outweigh the potential rewards, especially if there are market opportunities elsewhere.

Now, some have pointed to a few countries, particularly China, that appears to stand out as an exception, a place where Internet censorship is high and economic growth is strong. Clearly, many businesses are willing to endure restrictive internet policies to gain access to those markets, and in the short term, even perhaps in the medium term, those governments may succeed in maintaining a segmented internet. But those restrictions will have long-term costs that threaten one day to become a noose that restrains growth and development.

There are political costs as well. Consider Tunisia, where online economic activity was an important part of the country’s ties with Europe while online censorship was on par with China and Iran, the effort to divide the economic internet from the “everything else” Internet in Tunisia could not be sustained. People, especially young people, found ways to use connection technologies to organize and share grievances, which, as we know, helped fuel a movement that led to revolutionary change. In Syria, too, the government is trying to negotiate a non-negotiable contradiction. Just last week, it lifted a ban on Facebook and YouTube for the first time in three years, and yesterday they convicted a teenage girl of espionage and sentenced her to five years in prison for the political opinions she expressed on her blog.

This, too, is unsustainable. The demand for access to platforms of expression cannot be satisfied when using them lands you in prison. We believe that governments who have erected barriers to Internet freedom, whether they’re technical filters or censorship regimes or attacks on those who exercise their rights to expression and assembly online, will eventually find themselves boxed in. They will face a dictator’s dilemma and will have to choose between letting the walls fall or paying the price to keep them standing, which means both doubling down on a losing hand by resorting to greater oppression and enduring the escalating opportunity cost of missing out on the ideas that have been blocked and people who have been disappeared.

I urge countries everywhere instead to join us in the bet we have made, a bet that an open internet will lead to stronger, more prosperous countries. At its core, it’s an extension of the bet that the United States has been making for more than 200 years, that open societies give rise to the most lasting progress, that the rule of law is the firmest foundation for justice and peace, and that innovation thrives where ideas of all kinds are aired and explored. This is not a bet on computers or mobile phones. It’s a bet on people. We’re confident that together with those partners in government and people around the world who are making the same bet by hewing to universal rights that underpin open societies, we’ll preserve the internet as an open space for all. And that will pay long-term gains for our shared progress and prosperity. The United States will continue to promote an Internet where people’s rights are protected and that it is open to innovation, interoperable all over the world, secure enough to hold people’s trust, and reliable enough to support their work.

In the past year, we have welcomed the emergence of a global coalition of countries, businesses, civil society groups, and digital activists seeking to advance these goals. We have found strong partners in several governments worldwide, and we’ve been encouraged by the work of the Global Network Initiative, which brings together companies, academics, and NGOs to work together to solve the challenges we are facing, like how to handle government requests for censorship or how to decide whether to sell technologies that could be used to violate rights or how to handle privacy issues in the context of cloud computing. We need strong corporate partners that have made principled, meaningful commitments to internet freedom as we work together to advance this common cause.

We realize that in order to be meaningful, online freedoms must carry over into real-world activism. That’s why we are working through our Civil Society 2.0 initiative to connect NGOs and advocates with technology and training that will magnify their impact. We are also committed to continuing our conversation with people everywhere around the world. Last week, you may have heard, we launched Twitter feeds in Arabic and Farsi, adding to the ones we already have in French and Spanish. We’ll start similar ones in Chinese, Russian, and Hindi. This is enabling us to have real-time, two-way conversations with people wherever there is a connection that governments do not block.

Our commitment to internet freedom is a commitment to the rights of people, and we are matching that with our actions. Monitoring and responding to threats to internet freedom has become part of the daily work of our diplomats and development experts. They are working to advance internet freedom on the ground at our embassies and missions around the world. The United States continues to help people in oppressive internet environments get around filters, stay one step ahead of the censors, the hackers, and the thugs who beat them up or imprison them for what they say online.

While the rights we seek to protect and support are clear, the various ways that these rights are violated are increasingly complex. I know some have criticized us for not pouring funding into a single technology, but we believe there is no silver bullet in the struggle against internet repression. There’s no app for that. Start working, those of you out there. And accordingly, we are taking a comprehensive and innovative approach, one that matches our diplomacy with technology, secure distribution networks for tools, and direct support for those on the front lines.

In the last three years, we have awarded more than $20 million in competitive grants through an open process, including interagency evaluation by technical and policy experts to support a burgeoning group of technologists and activists working at the cutting edge of the fight against internet repression. This year, we will award more than $25 million in additional funding. We are taking a venture capital-style approach, supporting a portfolio of technologies, tools, and training, and adapting as more users shift to mobile devices. We have our ear to the ground, talking to digital activists about where they need help, and our diversified approach means we’re able to adapt the range of threats that they face. We support multiple tools, so if repressive governments figure out how to target one, others are available. And we invest in the cutting edge because we know that repressive governments are constantly innovating their methods of oppression and we intend to stay ahead of them.

Likewise, we are leading the push to strengthen cyber security and online innovation, building capacity in developing countries, championing open and interoperable standards and enhancing international cooperation to respond to cyber threats. Deputy Secretary of Defense Lynn gave a speech on this issue just yesterday. All these efforts build on a decade of work to sustain an Internet that is open, secure, and reliable. And in the coming year, the Administration will complete an international strategy for cyberspace, charting the course to continue this work into the future.

This is a foreign policy priority for us, one that will only increase in importance in the coming years. That’s why I’ve created the Office of the Coordinator for Cyber Issues, to enhance our work on cyber security and other issues and facilitate cooperation across the State Department and with other government agencies. I’ve named Christopher Painter, formerly senior director for cyber security at the National Security Council and a leader in the field for 20 years, to head this new office.

The dramatic increase in internet users during the past 10 years has been remarkable to witness. But that was just the opening act. In the next 20 years, nearly 5 billion people will join the network. It is those users who will decide the future.

So we are playing for the long game. Unlike much of what happens online, progress on this front will be measured in years, not seconds. The course we chart today will determine whether those who follow us will get the chance to experience the freedom, security, and prosperity of an open Internet.

As we look ahead, let us remember that Internet freedom isn’t about any one particular activity online. It’s about ensuring that the Internet remains a space where activities of all kinds can take place, from grand, ground-breaking, historic campaigns to the small, ordinary acts that people engage in every day.

We want to keep the Iternet open for the protestor using social media to organize a march in Egypt; the college student emailing her family photos of her semester abroad; the lawyer in Vietnam blogging to expose corruption; the teenager in the United States who is bullied and finds words of support online; for the small business owner in Kenya using mobile banking to manage her profits; the philosopher in China reading academic journals for her dissertation; the scientist in Brazil sharing data in real time with colleagues overseas; and the billions and billions of interactions with the Internet every single day as people communicate with loved ones, follow the news, do their jobs, and participate in the debates shaping their world.

Internet freedom is about defending the space in which all these things occur so that it remains not just for the students here today, but your successors and all who come after you. This is one of the grand challenges of our time. We are engaged in a vigorous effort against those who we have always stood against, who wish to stifle and repress, to come forward with their version of reality and to accept none other. We enlist your help on behalf of this struggle. It’s a struggle for human rights, it’s a struggle for human freedom, and it’s a struggle for human dignity.

Thank you all very much.

SAP apparently has other plans. Having won in December a small victory over the amount of interest it will have to pay, today SAP said it plans to argue that it shouldn’t have to pay quite as much to Oracle.

In a statement, it called the judge’s order a “procedural matter,” and said it plans to make post-trial motions challenging the amount the jury awarded. If not successful, it may appeal, the company said. Its full statement is below.

“Today the Court entered judgment in the Oracle v. SAP/TomorrowNow litigation, which is a procedural matter that occurs after a jury verdict. As stated before, we have accepted liability for the actions of TomorrowNow and have been willing to fairly compensate Oracle, but we believe that the amount awarded by the jury is disproportionate and wrong. Once the judgment is entered, SAP is permitted to challenge the jury’s award by way of “post-trial motions,” which are made to the trial judge. SAP will file these motions in the coming weeks asking the Court to reduce the amount of damages awarded or to order a new trial. We look forward to the Court’s resolution of the issues we will raise in our post-trial motions. Depending on the outcome of the post-trial motion process, SAP may also consider an appeal.”

Oracle, on the other hand, was happy to take another victory lap. “We are very pleased that the court’s final judgment for $1.3 billion, plus the court-awarded interest and the $120 million SAP paid during trial to settle additional charges, confirms the jury’s verdict against SAP for its massive intentional copyright infringement,” Oracle said in an emailed statement.

PREVIOUSLY:

• Oracle to SAP: You Owe Us Another $212 Million
• Oracle-SAP Verdict: SAP Owes Oracle $1.3 Billion
• Oracle-SAP: Closing Statements Followed by Closing Insults
• Oracle-SAP Case Closes With $1.67 Billion Difference of Opinion
• LOLCatz: Safra on The Stand Again in Oracle-SAP Trial
• Plattner and White No-Shows at Oracle-SAP Trial
• Damages Expert to SAP: You Owe Me $14 Million and Oracle Four Times That
• Oracle, SAP and the Apotheker Sideshow
• Better Late: SAP Co-CEO Apologizes for Oracle IP Theft
• SAP Co-CEO Expected to Testify in Oracle Trial Today
• HP to Oracle: Leave Léo Alone
• Oracle Still Hoping to Snag HP’s Apotheker for SAP Trial
• HP CEO to Oracle: Here’s Looking at You, Kid–Suntory Time!
• Ellison to Self: Damn, Damn. I Knew I Should Have Said $4.5 Billion
• SAP Attorney: Board Knew TomorrowNow Was Infringing at Time of Acquisition
• Oracle Co-President on SAP’s Damages Offer: “It’s Crazy”
• Oracle Enlists Process Servers, Not PIs, to Find HP CEO
• Oracle-SAP Trial: Ellison Swaps Katana for Poison Darts
• Objection: Mr. Ellison Is Referring to the Defendant as “Choleric of Temper” Again
• Oracle Lands Early Shots in SAP Trial
• Your Honor, We Object to Mr. Ellison’s Repeated Use of the Term “Slimy Weasels”
• Oracle to HP CEO: Chicken!
• Oracle Vs. SAP: We Got a Right to Pick a Little Fight–Bonanza!
• SAP’s Tab in Oracle Case: $120 Million and Counting
• Gag Order Denied in Oracle, SAP Trial
• Ellison Taunts HP CEO a Second Time
• SAP to Ellison: Save the Drama for Your Mama
• Ellison to HP CEO: “Warrior, Come Out to Plaaeeay!
• SAP: Please Gag Oracle
• HP Scandal Sucks in New York Times Columnist Over Conflict of Interest
• Welch to HP Board: You Don’t Know Jack!
• Insiders Criticize Ellison For HP CEO Slam
• Was Apotheker HP’s First Choice of CEO?
• HP Names Ex-SAP Chief Apotheker as CEO

It’s not yet 100 percent clear if this breach is connected to the recent breach of the email marketing firm Silverpop Systems, but it sure looks that way. Honda was an enthusiastic Silverpop customer as recently as 2009, according to this press release. It’s the same company whose data was breached in thefts of customer data from McDonald’s and deviantArt. A similar incident was reported concerning the drugstore chain Walgreen’s, but it hasn’t been tied specifically to Silverpop.

The list contained the names, login names, email addresses and–get this–vehicle identification numbers of more than two million Honda owners. Another list, this one containing only the email addresses of nearly three million Acura owners, was also taken.

Honda has contacted all the customers via email. The worry is that affected owners, especially those on the list with the VINs, may be targeted for some kind of phishing attack. Imagine getting an email from someone pretending to be your local Honda dealer who correctly identifies the car you just bought and asks you to give up more personal information so that you can get “special offers.”

With Oracle’s high-profile trade secrets case against SAP scheduled to begin in a few days, Ellison is in rare form and is filing copy like Hunter S. Thompson’s software magnate doppelgänger.

On Wednesday evening, Ellison let loose with another screed against Apotheker and his new employer, Hewlett-Packard, accusing the former of knowingly stealing Oracle’s intellectual property and the latter of helping him dodge a subpoena.

“HP Chairman Ray Lane has taken the position that Léo Apotheker is innocent of wrongdoing because he didn’t know anything about the stealing going on at SAP while Léo was CEO,” Ellison wrote. “The most basic facts of the case show this to be an absurd lie. Oracle sued SAP for stealing in March of 2007. Léo became CEO of SAP in April of 2008. Léo knew all about the stealing. In fact, Léo did not stop the stealing until 7 months after he became CEO. Why so long? We’d like to know. Ray Lane and the rest of the HP Board do not want anyone to know. That’s the new HP Way with Ray in charge and Léo on the run. It’s time to change the HP tagline from ‘Invent’ to ‘Steal’.”

Did I say Ellison’s latest tirade was more of a gala? Make that carnival–or bacchanal. This is goading of the top order, beginning with an accusation of outright theft and deceit, and ending with the verbal desecration of the hallowed HP Way, which Ellison attributes to Lane–a former Oracle president.

Sadly, Ellison gets his facts wrong again. As I noted here yesterday, Apotheker didn’t become SAP’s sole CEO until June of 2009–seven months after SAP shuttered the TomorrowNow division at the center of Oracle’s suit. But as I also noted yesterday, that’s just semantics. Apotheker wasn’t just some prole prior to his CEO appointment; he was co-CEO.

And anyway, who’s this latest philippic of Ellison’s really about? HP Chairman Lane’s name is mentioned in it nearly as many times as Apotheker’s. And he never worked for SAP.

But he did work for Oracle–until he ran afoul of Ellison–and now, of course, he works for HP, an Oracle rival. Look at the statement through that lens and you’ll see that it actually fulfills a threefold purpose:

1. Trash-talking SAP
2. Trash-talking Apotheker to smear HP
3. And trash-talking Lane to smear HP and vent some old resentments

This trial is every bit as much about HP as it is about SAP.

PREVIOUSLY:

• SAP to Ellison: Save the Drama for Your Mama
• Ellison to HP CEO: “Warrior, Come Out to Plaaeeay!
• SAP: Please Gag Oracle
• HP Scandal Sucks in New York Times Columnist Over Conflict of Interest
• Welch to HP Board: You Don’t Know Jack!
• Insiders Criticize Ellison For HP CEO Slam
• Was Apotheker HP’s First Choice of CEO?
• HP Names Ex-SAP Chief Apotheker as CEO

And SAP finds all the histrionics between the two companies a bit much. And as far as Oracle CEO Larry Ellison’s goading of former SAP CEO Léo Apotheker, well, SAP says Larry needs to get his facts straight.

This morning, the company took issue with Ellison’s claim that Apotheker “allowed the theft of Oracle property to continue for 8 months after he was made sole CEO of SAP.”

“This is more of the sideshow and clearly shows that Ellison’s true motivation is his personal vendetta against Apotheker and the HP board,” a spokesperson told me. “SAP remains focused on the core issues of the case–determining fair and accurate levels of compensation. These personal tirades are a distraction and, sadly, not even factually accurate.”

Which is true to a point, though I’d argue that Ellison’s tirades are more entertainment than distraction. Apotheker didn’t become SAP’s sole CEO until June of 2009–seven months after SAP shuttered the TomorrowNow division at the center of Oracle’s suit.

So SAP is right. Ellison’s rant isn’t quite factually accurate. That said, were one to swap in “co-CEO” for “sole CEO,” it would be.

So as a parry to Ellison’s broadside, this is pretty weak stuff. If it’s the best SAP’s got, it doesn’t stand a chance in this developing war of words.

PREVIOUSLY:

• Ellison to HP CEO: “Warrior, Come Out to Plaaeeay!
• SAP: Please Gag Oracle
• HP Scandal Sucks in New York Times Columnist Over Conflict of Interest
• Welch to HP Board: You Don’t Know Jack!
• Insiders Criticize Ellison For HP CEO Slam
• Was Apotheker HP’s First Choice of CEO?
• HP Names Ex-SAP Chief Apotheker as CEO

Apotheker’s first day as CEO of HP, Nov. 1, is also the first day of the trial. And he’s on Oracle’s witness list.

But if he’s called, will he show up?

Oracle’s not sure he will, but it wants everyone to know that it has big plans for him in the courtroom, whether he does or not.

In a statement Tuesday night, Oracle CEO Larry Ellison essentially dared Apotheker to appear on the witness stand, suggesting that HP’s newly appointed Chairman, Raymond Lane–a former Oracle president–might try to keep him from testifying.

“A few weeks ago I accused HP’s new CEO, Leo Apotheker, of overseeing an industrial espionage scheme centering on the repeated theft of massive amounts of Oracle’s software. A major portion of this theft occurred while Mr. Apotheker was CEO of SAP,” Ellison said in a statement.

“HP’s Chairman, Ray Lane, immediately came to Mr. Apotheker’s defense by writing a letter stating, ‘Oracle has been litigating this case for years and has never offered any evidence that Mr. Apotheker was involved.’ Well, that’s what we are planning to do during the trial that starts next Monday. Unless, Mr. Lane and the rest of the HP Board of Directors decide to keep their new CEO far, far away from HP Headquarters until that trial is over. If HP keeps Leo Apotheker far from HP headquarters we cannot subpoena him to testify at that trial.”

Which is true–as a foreign national, Apotheker is under no legal obligation to appear at the trial if called to testify (his name has been on Oracle’s witness list since August 5, 2010–see image below). But given the recent war of words between Oracle and HP over his hiring, it would be odd for him not to, particularly if, as HP claims, he wasn’t involved in the IP theft at the center of Oracle’s suit.

That said, it seems HP is already setting the stage for Apotheker to be a no-show.

“Oracle had ample opportunity to question Leo during his sworn deposition in October 2008,” the company said in a statement. “Given Leo’s limited knowledge of and role in the matter, Oracle’s last-minute effort to require him to appear live at trial is no more than an effort to harass him and interfere with his duties and responsibilities as HP’s CEO.”

One last thing: If you missed the reference in the headline of this post, here’s your explanation:

The justification for that request? A recent piece by New York Times business columnist Joe Nocera accusing TomorrowNow of “the most serious business crime you can commit” and suggesting that former SAP chief Léo Apotheker–who was recently named CEO of Hewlett-Packard– was well aware of it. “He may not have been directly involved in this brazen theft of intellectual property, but it defies belief to say he didn’t know about it,” Nocera wrote. “And he did nothing to stop it until it was far too late.”

A damning indictment, were it not for one problem: Nocera’s fiancée serves as director of communications for the law firm representing Oracle in its suit against SAP, a clear conflict of interest for the columnist and one that wasn’t disclosed when this article was first published. And for SAP, reason enough to demand an order preventing lawyers on both sides from discussing the case outside the courtroom.

“The episode involving the New York Times article–coupled with Oracle’s counsel’s refusal to eschew publicity efforts during trial despite recognizing that jurors may not heed a court instruction not to read press coverage–leads to this motion,” SAP’s attorneys wrote. “Referring to this copyright dispute as ‘the most serious business crime’ is inflammatory and, to the extent anyone credits the author, prejudicial. The same is true of almost any type of extrajudicial statements by counsel that a juror might read. The jurors should hear evidence and argument in court only; they should not be exposed to counsels’ extrajudicial repetition of, or spin on, the in-court evidence and argument.”

Arguments on the gag order are due tomorrow, with a ruling to follow sometime after that. Trial starts in a week, and with a witness list that includes Apotheker as well as his harshest critic, Oracle CEO Larry Ellison, it should be great fun to watch.

Another reputation smeared in the Hewlett-Packard/Oracle slag-fest. Turns out Joe Nocera (pictured here)–the New York Times (NYT) business columnist who penned that scathing piece on former SAP chief and incoming Hewlett-Packard (HP) CEO Léo Apotheker for his involvement in a lawsuit over intellectual property theft between SAP (SAP) and Oracle (ORCL)–has a conflict of interest.

Nocera’s fiancée, Dawn Schneider, is director of communications for Boies, Schiller & Flexner, the law firm that just so happens to represent Oracle in its very same suit against SAP.

Here’s the editor’s note the Times just appended to Nocera’s story.

In the Talking Business column in Business Day on Saturday, Joe Nocera wrote about a lawsuit by Oracle against a division of SAP, claiming theft of intellectual property. Mr. Nocera learned after the column was published  that Oracle was represented by the law firm of Boies, Schiller & Flexner, where his fiancée works as director of communications. To avoid the appearance of a conflict of interest, Mr. Nocera would not have written about the case if he had known of the law firm’s involvement.

Odd to learn that Nocera, the Times’ star business columnist, was unaware that his own fiancée was a flack for the law firm repping Oracle in the suit (see screenshot above, with Boies named as counsel) that provided so much of the subject matter for his column.

But it seems he was not, up to today, when he made a CNBC appearance on the subject.

It’s not clear when Nocera found out about his conflict of interest. His column on the Oracle-HP spat, however, has been the talk of Silicon Valley over the last several days, including a smack back at it by incoming HP Chairman Ray Lane in a letter to the Times’ editor.

Here’s a video of Nocera talking about his HP column on CNBC:

[Nocera photo credit: Fred R. Conrad/The New York Times]

Who would have thought that the enterprise business would be this interesting?

But the continuing mishegas between Hewlett-Packard (HP), Oracle (ORCL) and the controversial move between the companies by exec Mark Hurd has now dragged in the New York Times (NYT).

Specifically, its star business columnist Joe Nocera, who penned a scathing piece a few days ago about the recent appointment of former SAP (SAP) top exec Léo Apotheker as CEO of HP to replace Hurd.

Wrote Nocera, as he wound up his fastball:

“Still, having written two unflattering columns recently about the H.P. board, I was inclined to take a pass on Mr. Apotheker’s hiring. But then I learned something about him that caused me to shake my head in disbelief.”

The thrust of Nocera’s column about a lawsuit over intellectual property theft between SAP and Oracle: Don’t throw stones at Hurd when you have such a dirty glass house.

But I am synopsizing, so here is the letter incoming HP chairman Ray Lane–who, by the way, once worked as president at Oracle until he and CEO Larry Ellison had a falling out.

You know, the non-shy and non-retiring Larry Ellison who has been sending constant verbal stink bombs over to the HP board of late–most recently at Apotheker–and who hired Hurd.

Folks, you cannot make this stuff up.

Here’s Lane’s letter (I removed all the email addresses) to the Times:

From: Ray Lane
Sent: Monday, October 11, 2010 8:59 AM
To: XXX
Cc: XXX
Subject: Letter to the Editor, NY Times

To the Editor:

Joe Nocera’s column, “A Double Standard at H.P.,” (October 9, 2010) grossly mischaracterizes the facts about why Mark Hurd had to leave HP, why the HP Board hired Léo Apotheker as CEO and the reason Oracle is trying to draw Mr. Apotheker into its lawsuit over TomorrowNow.

First, the lawsuit on TomorrowNow: Mr. Nocera concedes the suit between Oracle and SAP (and its now-shuttered subsidiary, TomorrowNow) is old news. Oracle has been litigating this case for years and has never offered any evidence that Mr. Apotheker was involved. It didn’t even deem him relevant enough to the case to include him on a list of witnesses for trial–until, that is, Mr. Apotheker was named CEO of HP and Oracle had other motives to try to tie him to the case.

The facts are: TomorrowNow was never under Mr. Apotheker’s supervision. The conduct in question at TomorrowNow occurred before Mr. Apotheker became CEO of SAP. And, it was Mr. Apotheker who, as CEO of SAP, shut down TomorrowNow. Mr. Nocera’s reporting on the case is sharply contradicted by that of an independent industry analyst–someone with real knowledge of the industry and the facts–who makes clear that Mr. Apotheker was not involved (http://ematters.wordpress.com/2010/10/09/setting-the-record-straight-oracle-sap-tomorrownow-and-the-nyt/).

As for the reasons why Mr. Hurd left HP: no Board can retain a CEO who violates the trust and integrity needed to lead a public company. Even Mr. Hurd publicly acknowledged that he failed to uphold those necessary standards. In the press release announcing his departure, he said that “… there were instances in which I did not live up to the standards and principles of trust, respect and integrity that I have espoused at HP…I believe it would be difficult for me to continue as an effective leader at HP and I believe this is the only decision the board and I could make at this time.” (Emphasis added.)

The bottom line is: Mr. Hurd violated the trust of the Board by repeatedly lying to them in the course of an investigation into his conduct. He violated numerous elements of HP’s Standards of Business Conduct and he demonstrated a serious lack of integrity and judgment. The Board was unanimous in its decision that he must go, including the seven directors Mr. Hurd recruited to the Board. These directors would not have acted unanimously to remove Mr. Hurd for “piddling expense account problems” as Mr. Nocera suggests. I was named to the Board after Mr. Hurd’s departure, but having carefully reviewed all the facts, it is clear to me the HP Board made the right decision. Had I been on the Board at that time, there’s no question I would have voted the same way. The Board simply had no alternative.

In hiring Léo Apotheker, HP’s Board turned to a principled leader of outstanding personal and professional integrity. He is an experienced, strategic thinker with the passion, global experience and operational discipline to realize our company’s enormous potential. Those are the qualities HP needs in a leader to move the company forward, and Mr. Apotheker is ideally suited to do that.

Sincerely,

Ray Lane
Incoming Non-Executive Chairman of the Board of Directors

“Piracy is theft. Clean and simple. It’s smash and grab. It ain’t no different than smashing a window at Tiffany’s and grabbing [merchandise].”

– U.S. Vice President Joe Biden

Here’s one way to respond to a hardware shortage: A Manhattan Apple store lost two boxes of iPads in two different robberies last week.

Police reports suggest that the same guy (perhaps with the aid of an accomplice) was behind both thefts. In both cases, the robberies occurred outside Apple’s Upper West Side store, when UPS (UPS) was dropping off new shipments of the gadgets.

The store’s employees, understandably, tell the New York Post they now have “a heightened security presence.”

Modest proposal: Why not leverage the legions of crazed Apple (AAPL) fans who are already willing to spend their free time standing outside the company’s stores? I bet you wouldn’t even have to pay them to help police the property–don’t you think Robert Scoble, et al would clamor for a chance to become deputized Apple loss-prevention experts?

You can read all of U.S. District Court Judge Kimba Wood’s ruling at the bottom of the post. But the short version is that Wood, using the Supreme Court’s Grokster decision as a guide, found that LimeWire is indeed guilty of copyright violations. In her words:

LimeWire… (1) is aware that LimeWire’s users commit a substantial amount of copyright infringement; (2) markets LimeWire to users predisposed to committing infringement; (3) ensures that LimeWire enables infringement and assists users committing infringement; (4) relies on the fact that LimeWire enables infringement for the success of its business; and (5) has not taken meaningful steps to mitigate infringement.

LimeWire is unusual among post-Napster, post-Grokster file-sharing operations in that it operates out in the open, in the U.S. The company, based in New York City and owned by investor Mark Gorton, actually sells a smattering of music itself with the blessing of some of the smaller music labels. But while the company has been engaged in a long back-and-forth with the big guys, it has never reached a settlement.

Meanwhile, almost all of the music available on the service (93 percent, according to a study used in the lawsuit) and even more of the stuff actually downloaded (98.8 percent, via the same study) is protected by copyright and should not have been there. Court documents state that LimeWire generated revenue of $20 million in 2006.

LimeWire does tell its users they shouldn’t steal music. This is the warning you get when you try to do so:

But that’s not enough, Wood ruled. And certainly not when the service was going out of its way to court users searching Google (GOOG) for free tunes. From her ruling:

LimeWire conducted a marketing campaign through Google AdWords, whereby Google users who entered certain search queries, such as “replacement napster,” “napster mp3,” “napster download,” “kazaa morpheus,” “mp3 free download,” and dozens of other phrases containing the words “napster,” “kazaa,” or “morpheus,” would see an advertisement leading them to the LimeWire website.

The next step in the case is a June 1 conference. Here’s LimeWire CEO George Searle’s statement, which doesn’t include a vow to appeal the ruling:

LimeWire strongly opposes the Court’s recent decision. LimeWire remains committed to developing innovative products and services for the end-user and to working with the entire music industry, including the major labels, to achieve this mission. We look forward to our June 1 meeting with Judge Wood.

And here’s the end-zone dance from Mitch Bainwol, CEO of the music industry’s lobbying group:

This definitive ruling is an extraordinary victory for the entire creative community. The court made clear that LimeWire was liable for inducing widespread copyright theft.

LimeWire is one of the largest remaining commercial peer-to-peer services. Unlike other P2P services that negotiated licenses, imposed filters or otherwise chose to discontinue their illegal conduct following the Supreme Court’s decision in the Grokster case, LimeWire instead thumbed its nose at the law and creators. The court’s decision is an important milestone in the creative community’s fight to reclaim the Internet as a platform for legitimate commerce. By finding LimeWire’s CEO personally liable, in addition to his company, the court has sent a clear signal to those who think they can devise and profit from a piracy scheme that will escape accountability.

We are gratified by the court’s careful and thorough analysis of the facts and applicable law.

Bigger question: What does this mean for the music industry? Assuming Wood’s ruling stands, this one will definitely feel good for the labels, and it would have been a very big deal had they lost. But it certainly won’t help them in fighting less formally organized P2P services or those set up outside the U.S.

Arista Records Summary Judgment Opinion

Kara stayed above the fray this week by opening up with a signature exclusive. She lunched with Ben Horowitz and got his take on why Andreessen dropped out of the race to fund Foursquare. Kara then got to look forward to some Bartz-baiting, as she prepared for Yahoo’s (YHOO) earnings call. It should be noted that Bartz-baiting is the official past time of residents of BoomTown. It turns out that Yahoo! did well this past quarter, even if revenues were still a little soft. Kara rounded out a solid week of reporting with a second exclusive that made use if her stealth-mode penetrating radar (we hear she had it installed back during the Reagan administration). She peeked under the blanket of Kakai, one of the Valley’s stealthiest startups and saw a Kindle for students. She couldn’t get much more, but we know that the company has a red phone to Chegg, the online textbook rental service, so the pieces are coming together.

John made it back from Europe this week, and now that the Volcano has settled down, it was time for Digital Daily to be truly daily again. Early in the week, John reported on the loss of some very important intellectual property by a tech giant. No, German beer was not involved. It turns out that the sensitive stuff hackers got a hold of during a recent attack on Google (GOOG) was the source code to their single sign-on system that interacts with all the Google-y services that seem to make the world go ’round. Tuesday, he reported the action as Apple (AAPL) trotted out its new, lengthier bank rolls on its earnings call. It was a good last quarter for Apple. Hopefully the unfortunate start to this one doesn’t get them down. John finished up the roller coaster week with a post about how it’s not just girls dressed up in animal ears that are huge in Japan. Apparently, so is the iPhone, which has now dominated near 75 percent of the Japanese smartphone market. Weekend Update expects it to continue to loom over Tokyo, at least until Mothra shows up.

Peter was still on baby hiatus this week, so Media Memo was a little sparse, but he managed to post a couple stories to tide us over until he returns in earnest. It turns out that Rolling Stone may be waking from its Rip Van Winkle-esque sleep and entering the digital age. And get this, they are going to charge for content. Tuesday brought news that blog platform Tumblr raised another $5 million from VCs. It seems that they aren’t done yet either. Tumblr will also be coming for the money of its users, with a monetization strategy that includes some of the usual suspects; pay premium service, virtual goods and the like. Peter finished the week with a point to ponder about the upcoming pay plans from Hulu. $10 a month seems to be the number filtering out of the reporter pool, but Peter wonders if $120 per year will be a little steep for consumers and a still not quite enough to pay for Hulu’s own bills. At least Tumblr can find comfort in knowing that even big businesses have trouble making money on the Web.

Walt reviewed the HTC HD2 this week in an attempt to answer the age old question, “How big is too big?” The device, currently on sale from T-Mobile, boasts a giant 4.3 inch (diagonal) screen. Walt didn’t think size was an issue, as the screen was nice and still portable. The issue came in the software and ease of use. It didn’t measure up to the big players in the market, and in the end, it doesn’t matter how big the screen is if you can’t use it for much. Mossberg’s Mailbox was headlined by a question about social games on the iPad, and Walt relayed the sad news that there would be no Mafia Wars on the iPad, at least not yet. He also demystified Apple TV, which even confuses Weekend Update from time to time. Katie finished up the week with a review of a new sort of service in the cloud. ICyte saves Web pages for later reading, even if the site changes or goes offline. It allows users to share these snapshots of sites, as well as spreading them around the social Web. Katie used the free version of the service, which is ad supported, and had good things to say overall, and thought it might be especially useful for people who do a lot of research online.

It’s been a long, stressful week for all of us here in the tech media space, and Weekend Update is going to sign off now and head over to our local watering hole for beer and some downtime with friends. As an added precaution, we’ve duct taped our iPads to our arms. Wouldn’t want to leave them by accident.

Last week, BoomTown translated an opinion piece written by Google CEO Eric Schmidt and published in The Wall Street Journal that focused on defending the search giant from criticism that it was, well, killing journalism.

One of the louder critics, in fact, has been Rupert Murdoch, chairman and CEO of News Corp. (NWS), who has been loaded for bear in regard to Google (GOOG), leveling a series of high-profile verbal attacks on the company.

Last week, Murdoch published his own piece in The Journal, which he owns (along with this Web site), on the topic of the wrenching changes in the news business and in which he never mentioned Google by name.

But the company was there anyway, so, in the interests of equal opportunity balloon-pricking, I must also render Murdoch’s post through my decoding machine, because it’s only sporting!

His op-ed, The Journal noted, “has been adapted from his Dec. 1 remarks before the Federal Trade Commission’s workshop on journalism and the Internet.”

What Murdoch wrote: Journalism and Freedom

By RUPERT MURDOCH

Translation: Crikey, as they say in Australia, I have been getting a little wobbly over Google’s growing power, but those bludgers in government will always make me go more troppo.

And, unlike Eric Schmidt, I didn’t need to be called Emperor Palpatine to scare people. Plain old “Rupe” works just fine to give most people the shakes.

What Murdoch wrote: We are at a time when many news enterprises are shutting down or scaling back. No doubt you will hear some tell you that journalism is in dire shape, and the triumph of digital is to blame.

My message is just the opposite. The future of journalism is more promising than ever–limited only by editors and producers unwilling to fight for their readers and viewers, or government using its heavy hand either to overregulate or subsidize us.

Translation: Please try to ignore the salient fact that it was actually Rupert Murdoch–me!–who has been loudly clanging the bell of late about how Google is laying waste to journalism, much as Sean Hannity did to that poor Alan Colmes nightly for a dozen years.

Also, please ignore that I am saying my message is just the opposite, because–really–I hate government more than I hate Google, so this makes perfect sense if you really think about it.

But don’t think about it, mate!

Murdoch wrote: From the beginning, newspapers have prospered for one reason: The trust that comes from representing their readers’ interests and giving them the news that’s important to them. That means covering the communities where they live, exposing government or business corruption, and standing up to the rich and powerful.

Does this mean we are all going to succeed? Of course not. Some newspapers and news organizations will not adapt to the digital realities of our day–and they will fail. We should not blame technology for these failures. The future of journalism belongs to the bold, and the companies that prosper will be those that find new and better ways to meet the needs of their viewers, listeners, and readers.

Translation: Teri: Cue the speech about what journalism means for the little people! But also make sure we get in how News Corp. gets all this digital hoo-ha too and how we are not going to let those pointy-heads of Silicon Valley think we are not ready to rumble!

What Murdoch wrote: First, media companies need to give people the news they want. I can’t tell you how many papers I have visited where they have a wall of journalism prizes–and a rapidly declining circulation. This tells me the editors are producing news for themselves–instead of news that is relevant to their customers. A news organization’s most important asset is the trust it has with its readers, a bond that reflects the readers’ confidence that editors are looking out for their needs and interests.

Translation: There was a trophy cabinet and award wall just like that at The Wall Street Journal before I bought it. I ate it it for breakfast.

What Murdoch wrote: At News Corp., we have been working for two years on a project that would use a portion of our broadcast spectrum to bring our TV offerings–and maybe even our newspaper content–to mobile devices. Today’s news consumers do not want to be chained to a box in their homes or offices to get their favorite news and entertainment–and our plan includes the needs of the next wave of TV viewing by going mobile.

The same is true with newspapers. More and more, our readers are using different technologies to access our papers during different parts of the day. For example, they might read some of their Wall Street Journal on their BlackBerries while commuting into the office, read it on the computer when they arrive, and read it on a larger and clearer e-reader wherever they may be.

Translation: Teri: Tell Jon Miller to get on a plane stat and start chit-chatting with those Asian manufacturers asap. I am not going to let Amazon (AMZN) head Jeff Bezos guffaw me into oblivion with his Kindle or have “American Idol” get hijacked by Apple (AAPL) or have those Google (GOOG) twins shine me on, even as they are developing some magic mobile phone.

What Murdoch wrote: My second point follows from my first: Quality content is not free. In the future, good journalism will depend on the ability of a news organization to attract customers by providing news and information they are willing to pay for.

That’s not going to change, even in a boom. The reason is that the old model was founded on quasimonopolies, such as classified advertising, which has been decimated by new and cheaper competitors such as Craigslist, Monster.com, and so on.

Translation: My second point follows from the first: We can’t charge for milk when we have been giving away the cow for free.

And, frankly, the old media have been lending out Bessie to every Web site that comes looking for a gallon, free of charge, in abject fear that no one likes milk anymore.

In the good old days, when we were the only beverage around–I like to call it a “quasiMOOnopoly”–we could set any price we wanted.

Now, unfortunately, everybody’s got milk.

What Murdoch wrote: In the new business model, we will be charging consumers for the news we provide on our Internet sites. The critics say people won’t pay. I believe they will, but only if we give them something of good and useful value. Our customers are smart enough to know that you don’t get something for nothing.

Translation: People will pay, once we de-index our sites from Google and they can’t get their daily dose of the New York Post’s Page Six for free. Where else will they get the latest online tidbits on the Tiger Woods scandal, for example?

Okay, from everywhere. But Page Six names at least 46 percent more mistresses than TMZ, and that’s worth something.

What Murdoch wrote: That goes for some of our friends online too. And yet there are those who think they have a right to take our news content and use it for their own purposes without contributing a penny to its production. Some rewrite, at times without attribution, the news stories of expensive and distinguished journalists who invested days, weeks or even months in their stories–all under the tattered veil of “fair use.”

Right now, content creators bear all the costs, while aggregators enjoy many of the benefits. In the long term, this is untenable. We are open to different pay models. But the principle is clear: To paraphrase a famous economist, there’s no such thing as a free news story, and we are going to ensure that we get a fair but modest price for the value we provide.

Translation: By “friends,” I mean “sworn enemies,” also known as “Google.” (Until it meets with me to do a deal and then it is “friends” again.)

By “tattered veil of ‘fair use,’” I mean “the law I am going to get gutted by my 1,473 lobbyists in Washington, D.C.”

By “to be impolite, it’s theft,” I mean “to be impolite, it’s theft by Larry and Sergey.” (Until they meet with me to do a deal and fork over the moolah, and then it will be a “business arrangement.”)

By “there’s no such thing as a free news story,” I mean “I hope to trick those Google-obsessed Bing boys at Microsoft (MSFT) into paying me that boatload of money they aren’t sending Carol Bartz of Yahoo (YHOO).”

What Murdoch wrote: Finally, a few words about government. In the last two or three decades, we have seen the emergence of new platforms and opportunities that no one could have predicted–from social networking sites and iPhones and BlackBerries, to Internet sites for newspapers, radio and television. And we are only at the beginning.

These developments mean increased competition, and that is good for consumers. But just as businesses are adapting to new realities, the government needs to adapt too. In this new and more globally competitive news world, restricting cross-ownership between television and newspapers makes as little sense as would banning newspapers from having Web sites.

Translation: Oh, I do not like Silicon Valley, but I dislike government even more!

And now that Google is its bogeyman instead of me, I really hope to finally be able to gut all those annoying cross-ownership rules that prevented me from owning the entire media landscape of every major city in America.

This must be done immediately, because those icons on people’s cellphones–especially that dangerous iFart app–are poised for attack!

What Murdoch wrote: In my view, the growing drumbeat for government assistance for newspapers is as alarming as overregulation. One idea gaining in popularity is providing taxpayer funds for journalists. Or giving newspapers “nonprofit” status–in exchange, of course, for papers giving up their right to endorse political candidates. The most damning problem with government “help” is what we saw with the bailout of the U.S. auto industry: Help props up those who are producing things that customers do not want.

The prospect of the U.S. government becoming directly involved in commercial journalism ought to be chilling for anyone who cares about freedom of speech. The Founding Fathers knew that the key to independence was to allow enterprises to prosper and serve as a counterweight to government power. It is precisely because newspapers make profits and do not depend on the government for their livelihood that they have the resources and wherewithal to hold the government accountable.

Translation: You bailin’ out me? You bailin’ out me? You bailin’ out me? Then who the hell else are you bailin’ out? You bailin’ out me? Well I’m the only one here. Who the %*#! do you think you’re bailin’ out?”

What Murdoch wrote: When the representatives of 13 former British colonies established a new order for the ages, they built it on a sturdy foundation: a free and informed citizenry. They understood that an informed citizenry requires news that is independent from government. That is one reason they put the First Amendment first.

Translation: Teri: Please insert the clarion cry of the First Amendment here, as it always stirs the heartstrings.

What Murdoch wrote: Our modern world is faster moving and far more complex than theirs. But the basic truth remains: To make informed decisions, free men and women require honest and reliable news about events affecting their countries and their lives. Whether the newspaper of the future is delivered with electrons or dead trees is ultimately not that important. What is most important is that the news industry remains free, independent–and competitive.

Translation: Believe me, if we could push a button and get rid of the whole Internet, News Corp. and Time Warner (TWX) and Viacom (VIA) and CBS (CBS) and the whole lot of us old media players would.

Barring that, whether the newspaper of the future is delivered with electrons or dead trees is ultimately not that important.

What is most important is that the news industry shake down big piles of dough from those Silicon Valley moneybags–whether they be Google or that Mark Zuckerberg kid, whenever Facebook goes public, or those Twitter dudes (if they figure out a way to make any money outside of fund raising)–in order to remain free, independent–and competitive.

It is, after all, the American way.

Please see this disclosure related to me and Google.

Of the 600 financial sector workers surveyed on Wall Street and London’s Canary Wharf who lost or left a job last year, 41 percent admitted to taking confidential company data with them. Exactly half, 50 percent, said they would steal company information if they were fired tomorrow, and 39 percent said they would download it if they felt their job was at risk.

Nearly a third, 28 percent, would use the information to negotiate their next position. The most commonly stolen data: Customer contact lists that could be leveraged at a new job.

Cyber-Ark’s study isn’t the first to uncover such employee sentiments. A similar effort by the Ponemon Institute earlier this year found that close to 60 percent of people who left or lost their jobs in 2008 took company data with them. “I’m not sure that malicious intent and future employment are mutually exclusive,” Larry Ponemon, chairman of the Ponemon Institute, told eWeek at the time.

“Clearly the responses show that obtaining future employment was a significant motivating factor,” Ponemon added, “but when we see a high percentage of individuals who took information knowing full well they were acting in violation of company policy, that hints strongly at the presence of malice.”