A U.S. federal court ruled on Friday that MP3.com Inc. violated copyright law with the creation of its database in which users can store music and then access it via any computer connected to the Internet.

The ruling stemmed from a lawsuit filed in January by the world's largest record labels, which said that the database of more than 80,000 copyrighted albums, part of the online music downloading company's http://my.mp3.com service, represented copyright infringement.

The database is part of the San Diego, Calif.'s company's software that allows computer users who own one of these recordings can listen to the albums over the Internet from any computer.

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A researcher has discovered a security hole in Qualcomm Inc.'s Eudora e-mail program that could allow a hacker to run code on a user's machine.

The exploit requires that a user open an e-mail file and click on a link in the message, said Bennett Haselton, a Webmaster for Peacefire.org who reported the flaw.

When a user clicks the link, the code is executed. The trick, explained here, is to mask the warning that Eudora normally displays when a user tries to run an executable file that is sent as an attachment.

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The European Commission today opened an investigation into possible price-fixing by Nintendo and seven video game distributors.

The Commission has been looking into whether these companies divided up the market for Nintendo video game systems like the "NES" model and the portable "Game Boy" in order to keep prices artificially high.

"The Commission believes that the companies concerned participated in a cartel-like arrangement with the aim of partitioning the European single market," the agency said in a statement. The Commission is the 15-nation European Union's regulatory body.

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Tribal Voice Inc. filed a complaint with the Federal Communications Commission Tuesday urging it to push America Online Inc. to open its AOL Instant Messenger client to outside IM providers before its merger with Time Warner Inc. is approved.

Tribal Voice, along with other IM service providers like Microsoft Corp. and Yahoo Inc., have been at odds with AOL for nearly a year over the company's refusal to allow users of other IM clients to communicate with its 91 million AIM users.

In the FCC complaint, Tribal Voice says that there are no technological barriers to interoperability and that AOL is the only obstacle.

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The legal pressure on MP3-swapping software Napster is growing, and with it the focus on university students who may be breaking the law by using it.

Angry at what they see as theft of their work, several recording artists have filed lawsuits targeting students. Specific individuals have not yet been named, but the attorney for artists Dr. Dre and Metallica, the first musicians to file lawsuits, says he can add names to the complaint as he gets more information.

Difficulties in identifying specific copyright violators could make the exercise impractical. But the development has stirred anger among some students, who criticize "millionaire musicians" for targeting relatively poor fans. At the same time, the move is being called a "scare tactic" by some in the legal community.

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Claiming consumers will suffer if America Online purchases Time Warner, four consumer advocacy and media access groups filed a petition with the Federal Communications Commission Wednesday to block the transaction unless it is restructured.

"We have nothing against these two companies," says Gene Kimmelman, codirector of Consumers Union, which leads the petition effort. But the firms have a history "that is in disregard of our nation's laws against concentration of ownership and monopolistic transactions," Kimmelman says.

The Consumers Union is joined in its concerns by the Center for Media Education, the Consumer Federation of American, and the Media Access Project. They contend the merged company would dominate television and Internet content, as well as broadband and narrowband Internet services.

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The Nasdaq, the No. 2 U.S stock market, on Tuesday said it bought a software company from FleetBoston Financial Corp. to make its trading process more efficient.

The Nasdaq, which is owned by the National Association of Securities Dealers, declined to disclose what it paid for Financial Systemware Inc., a Nasdaq spokesman said. The Nasdaq, a unit of the NASD, will rename its new subsidiary, Nasdaq Tools. The quest to make trading quicker and smoother is a continuing one for Nasdaq, which is facing more competition from off-exchange electronic rivals. On April 14, the NASD said a majority of its members voted to spin off the Nasdaq into a company partly owned by investors later this year.

The software products of Financial Systemware have order-routing and quote-management features that will allow Nasdaq stock traders to streamline the entering of buy and sell orders, and the execution of trades. The firm also produces software that will enable traders to comply more easily with Nasdaq regulations.

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Already a major player in Web services, the United Parcel Service announced today that it is expanding into electronic bill payment.

Through its new service, UPS will help control the flow of money between buyers and sellers. Businesses will pay for goods electronically but prior to payment, buyers can track the status of their goods, and based on that information, adjust the amount of payment. For instance, a company buying merchandise that is delivered damaged could contact UPS to withhold a percentage of the payment.

"There is so much money to be saved through electronic bill payment that the company that facilitates that savings stands to be in a good position to earn some of that money themselves," said James Van Dyke, Jupiter Communications senior analyst. "The technology is there, just nobody so far is using it."

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Rap artist Dr. Dre sued MP3-swapping firm Napster today, adding a new layer of legal woes to the already besieged company.

But this time, the stakes are being raised: Dr. Dre also is targeting students at universities who are using the Napster software to download MP3 files, the first time that individual music listeners have been put into the legal line of fire.

It's the second lawsuit filed by musicians who say the controversial software is responsible for massive violations of their copyrights. Heavy metal band Metallica also is seeking to close Napster's digital doors.

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Law enforcement authorities are investigating a cyber attack today on a major Web hosting firm that slowed service or shut down many Internet properties.

Although AboveNet restored service by mid-afternoon, many of its 1,000 dot-com customers experienced sluggish Web site performance--or total outages in some cases--since mid-morning, according to Paul Vixie, senior vice president of Internet services for Metromedia Fiber Network, AboveNet's parent company.

"Almost all of (our customers) felt some kind of pain from this," Vixie said. "This was a malicious and painful attack."

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Australian company FishPC is advertising a translucent PC on its Web site that looks very similar to Apple's trendy iMac. But while the iMac is an all-in-one PC, FishPC's computer apparently is not.

"I'm not a legal expert, so I'm not sure if there are copyright or trademark infringements involved," Apple representative Alec Rosen said on Friday. "But it looks pretty darn close to an iMac."

Timothy Sabre, general manager of FishPC, said in an email exchange yesterday that his product is not an iMac knockoff.

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Intel boosted the speed of its notebook PC chips Monday with the launch of new mobile Pentium III and mobile Celeron processors.

For high-end notebooks, the company launched a mobile Pentium III that runs at speeds as fast as 700MHz using Intel's proprietary SpeedStep technology. SpeedStep allows a chip to run at different clock speeds depending on whether a notebook is running on batteries or plugged into a power supply.

On batteries, the new Pentium III operates at 550MHz. When the notebook is plugged into a power supply, the processor automatically jumps up to 700MHz, Intel officials said in a statement.

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Qualcomm has invested $144 million in free-access ISP, NetZero, which in turn will begin distributing Qualcomm's Eudora e-mail as its preferred client software, the companies said in a release Monday.

The e-mail software will be included on NetZero CDs and will be part of the standard install program for NetZero's client-access software. NetZero, with more than 3 million registered users, is one of the largest providers of free Internet access and e-mail.

The Eudora software is free of charge when used in sponsor mode, which displays advertisements in a small window on the user's monitor. Qualcomm released Eudora 4.3 in February.

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Ask Jeeves is putting popularity to work. On Monday, the Web information access provider unveiled its Webwide Navigation Services, a suite of three popularity-based Internet navigation products.

The services are Jeeves Popularity Search, Jeeves Directory Search, and Jeeves Compare. Ask Jeeves acquired the technology behind the trio with the purchase of Direct Hit Technologies earlier this year.

"It's all about relevancy," says Sean Murphy, vice president of product management at Ask Jeeves. "There's a lot of focus to drive users to a Web site, but not a lot of focus on the user experience at the site."

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Facing increasing pressure from artists concerned about massive copyright violations, MP3 music-swapping company Napster isn't budging.

Rap artist Dr. Dre served the company with an ultimatumearlier this week, demanding that it remove his work from its service or face potential legal consequences. Napster's attorneys said today that the company can't agree to the request and that all it can do is block specific people whom musicians say are illegally trading songs.

"Napster will block access to people who are identified by copyright holders as violators," said Napster's attorney, Fenwick & West's Lawrence Pulgrum. "We sent that to Dr. Dre. Now it's up to them what to do."

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Web sites catering to kids are scrambling to meet Friday's deadline to comply with the Children's Online Privacy Protection Act. Many won't make it, possibly facing stiff fines, according to the Federal Trade Commission.

The act mandates that sites with traffic that includes children under the age of 13 post a privacy policy spelling out what information they collect about their child visitors. Sites must have a parental notification and approval system in place.

"What we're learning is that a lot of sites aren't in compliance," says Parry Aftab, a children's Internet lawyer and author of The Parents Guide to Protecting Your Children in Cyberspace.

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Intel is delaying its planned launch of two desktop Celeron chips until June, sources close to the company said Thursday. The two chips -- with clock speeds of 633MHz and 667MHz respectively -- were set to appear Monday.

"Demand continues to be high for our products as we said in our earnings Tuesday," an Intel spokesman said. "Our public guidance remains unchanged, we still intend to ship faster Celerons in the second quarter."

However, the Intel spokesman would not be drawn on an exact shipping date for the chips.

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NEC Corp, the world's second-largest chipmaker, said on Friday it will begin constructing within a year buildings to house new chip plants in California and Hiroshima, Japan.

NEC will spend 300 billion ($2.84 billion) to build new plants -- one each in the United States and Japan -- to make general-purpose memory chips and valued-added system LSI (large- scale integrated) chips, the Nihon Keizai Shimbun financial daily reported on Friday.

A company spokesman generally confirmed the details of the report. But he said NEC, which has announced a flurry of plans the past two weeks to build new chip factories and expand existing facilities, has not decided how much to invest in the new plants, which will stand empty until some uncertain future date.

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The Internet Corp. for Assigned Names and Numbers (ICANN) took a small step toward creating more space in cyberspace by adding new domains to the ones connoted by the ubiquitous ".com," ".net" and ".org" suffixes.

ICANN is the nonprofit responsible for maintaining the infrastructure for Internet addresses. An ICANN committee issued a recommendation to the group's board of directors that a policy governing the creation of such categories, called "generic top-level domain names," be created in an effort to better categorize Web sites and make them easier to find.

Support for the expansion of top-level domains was not unanimous. Some companies complained that with the introduction of new domains comes new vulnerability for trademark infringement.

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IBM this week is firing another shot in the battle of the low-cost PC. Big Blue is announcing a line of PC 300 desktop systems aimed primarily at budget-minded small businesses, with prices starting at $679 (not including monitor).

IBM claims the system unit is one of the smallest in the industry. Measuring 3.5 inches by 12 inches by 15 inches, it's about the size of a typical VCR, so you can place it inside or underneath furniture. (A "micro-tower" case is also standard with some models.)

The 12 standard business configurations of the PC 300 will be available in mid-May, and will be sold both by dealers and direct through IBM's Web site.

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Canadian police say they have charged a 15-year-old hacker known online as Mafiaboy with jamming the CNN.com Web site and up to 1200 CNN-hosted sites for four hours on February 8.

Mafiaboy, who cannot be named under a Canadian law that withholds the identities of juveniles, was arrested on Saturday and was formally charged on Monday, according to the Royal Canadian Mounted Police.

He was charged with two counts of mischief to data, police say. Mafiaboy has been released, but his bail conditions include not using a computer except for academic purposes and under the supervision of a teacher. He is also prohibited from connecting to the Internet or frequenting stores that sell computers or computer paraphernalia.

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America Online may have just been thrown a curve ball as it seeks to bat away competitors intent on forcing the company to open its hugely popular instant messaging services.

Sweden-based My Solutions this week released software dubbed MyCQ that allows people to simultaneously log on to multiple messaging products and communicate on all of them through a single interface.

Although MyCQ does not technically allow incompatible services to talk to one another, it could reduce the gap between rival products by making it easy to sign up for and manage them. For now, the product supports ICQ and AOL Instant Messenger (AIM), according to documentation on the company's Web site. However, the product is largely untested and may not live up to its promises.

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Advertisers spent $4.6 billion on Internet advertising last year, double the amount spent in 1998, the Internet Advertising Bureau said Tuesday.

Advertisers spent $1.7 billion in the fourth quarter of 1999 to end a year that saw online ad revenue grow 141 percent over the $1.92 billion spent in 1998, according to a study conducted by the accounting firm PricewaterhouseCoopers and released by the Internet Advertising Bureau, a New York-based industry group.

Consumer-related advertising was the leading segment, at 31 percent of spending; followed by financial services, 17 percent; and computing, 16 percent, according to a survey of 200 companies and as many as 1,200 websites.

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Some new Yahoo Mail users found themselves too close for comfort last week when a technical glitch piled as many as 100 people into the same account.

"For a short period of time, new users who signed up were assigned erroneously to the same email account," said Lisa Pollock, senior producer for Yahoo Mail. "When they signed up for a Yahoo email account, we had multiple IDs that were assigned to a single Yahoo.com address."

New members, possibly numbering "in the hundreds," were assigned to two email addresses that Yahoo knows of before the problem was straightened out, Pollock said. She added that people with existing accounts were not affected.

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Calling current technology for online forms "outdated," the Web's leading standards organization today released a draft of a new specification that promises to make forms work on various Web access devices and perform better with applications and databases based on XML.

The World Wide Web Consortium today released a draft for the XForms data model, one of three installments of a proposed XForms specification that will govern how Web designers create those pesky forms that ask your name, credit card numbers, clothing measurements and other personal information.

The data model establishes how forms will "validate" the information you enter. For example, if the form asks for a phone number, the data model lets the form make sure that you have entered 10 digits instead of just seven. Web authors currently have to use unwieldy scripts to validate form data.

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Move aside Lara Croft . Ananova goes live tomorrow as the first Internet news anchor, and if her creators have their way, she will be everywhere in a few years - from our phones to our alarm clocks.

She's designed to speak in a mid-Atlantic accent, neither distinctly American nor British, smile when the news is amusing and be an expert on sports trivia, among many other things. The question is whether this Internet search engine overlaid with software will be convincing in simulating a human.

If she's believable, Ananova will be the latest step in making the Net more popular and accessible. She'll also be a high-profile showcase for the companies that produced her software. Virtual brokers and rock groups could be born in her wake.

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Napster addicts in need of a music fix were stifled Monday by the unavailability of the company’s servers.

Starting around 7 a.m. PDT Monday, servers and home pages for Napster, a popular service that allows Internet users to exchange MP3 music files, have been unavailable and disconnecting users.

The problems are likely linked to Napster's hosting service, AboveNet, which has been experiencing difficulties with its backbone connection to Sprint.

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The growing ranks of free Internet service providers are mostly marketing tools, rather than potential revenue or profit sources, experts say, although they are gaining interest and forcing some changes in the dot-com field.

The free ISPs appeal to bargain-conscious consumers, often drawing new Internet users from among those who might otherwise be only thinking of trying the Internet without actually taking the plunge.

Once they attract at least a minimum audience level, the free ISPs are alluring and viable for advertisers, Internet analysts say. For advertisers, they are "a good, inexpensive way for serving up ad banners on the providers' Web sites," says Dylan Brooks, an analyst at Jupiter Communications.

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A laptop computer that may have held classified information disappeared from the State Department about two months ago, and the FBI is Investigating whether it was stolen, the State Department said today.

The Washington Post said the computer disappeared from the department's Bureau of Intelligence and Research and definitely contained highly classified information.

The paper quoted a senior State Department official as saying the laptop's disappearance, from a supposedly secure conference room at the department, set off an intense effort to recover the computer and a search for suspects, including contractors who had been renovating the area.

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Your PC could soon become the brains behind a cable TV box that brings interactive digital TV--a new blend of Web access, entertainment, e-commerce, and gaming--into your home. That vision moved a step closer to reality this week when network hardware maker SCM Microsystems announced it has successfully tested the first PC receiver that works with the scrambled signals of different cable TV companies under a new OpenCable protocol.

Today's cable TV set-top boxes are proprietary and contain all of the computer smarts and security technology cable companies use to convert signals and prevent their content from being stolen. OpenCable provides for moving most of the digital process to the PC, while security resides on credit card-sized PC cards that plug in like keys.

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MP3.com and several prominent record labels were sued in federal court today by musicians who seek royalty payments for the distribution of their songs over the Internet.

The suit, filed by musicians who perform as The Chambers Brothers, The Coasters and The Original Drifters, seeks a ruling that neither MP3.com nor the record labels--Time Warner, Sony Corp. of America and two others--have the right to transmit their songs over the Internet.

The lawsuit comes nearly four months after a trade group representing the record labels sued MP3.com for distributing songs online. Lawrence Feldman, a Jenkintown, Penn., lawyer who brought the case, said the record labels' case protects the rights of only record companies, not artists.

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Heavy metal band Metallica has always been synonymous with music that is played fast and loud. After filing a lawsuit Thursday, the band might become more famous as the first group to strike a chord against music piracy on the Net.

Metallica filed a lawsuit against Napster in the US District Court, Central District of California, alleging that the company encourages piracy by enabling and allowing its users to trade copyrighted songs through its servers.

The suit also names the University of Southern California, Yale University, and Indiana University, institutions which, ironically, have attempted to deal with the problems associated with students’ use of Napster on campus networks.

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Kids under age 13 may no longer create profiles listing personal information such as name, age and interests in America Online's membership directory, as a result of a children's privacy law that takes effect next wee

And if they think that's drastic, wait until April 21, the day the law kicks in: All existing profiles listing birthdays from 1988 on will be deleted.

The changes are being made to comply with the Children's Online Privacy Protection Act (COPPA), intended to prevent the collection of personal information from children without their parents' explicit consent.

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Advanced Micro Devices Inc. delivered spectacular sales and earnings in its first quarter Wednesday, almost doubling analysts' profit estimates.

"Q1 was a great start to the new millenium at AMD," Chairmand and CEO W.J. Sanders III told analysts during a Wednesday afternoon conference call. "This was particularly for our PC processor business."

Strong sales of its high-performance Athlon chips helped AMD earn $189.3 million, or $1.15 a share, on sales of $1.09 billion.

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Forrester Research added its voice to the chorus of skeptics hammering Internet retailers of late, issuing a report that predicts the demise of most Internet-only retailers by the end of next year.

"The combination of weak financials, increasing competitive pressures, and investor flight will drive most of today's dot-com retailers out of business by 2001," according to a statement issued by the research company.

Forrester is predicting that business-to-consumer electronic-commerce consolidation will come in three waves. First, companies that have been successful selling products such as books and software online for a while will start merging by this fall.

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The Advisory Commission on Electronic Commerce, after two years of study, has offered a split decision on banning Internet taxes. The next move is by Congress, but its direction is far from certain.

Virginia Governor James Gilmore, who chaired the commission, presented the report at the U.S. Capitol Wednesday. He called it a "cohesive and comprehensive framework" that lawmakers can use as they consider legislation dealing with electronic commerce.

The report is not considered binding because it failed to gain a two-thirds majority vote from the 19-member commission. Even as Gilmore presented it, there were signs that support for some of its recommendations are not as firm as Gilmore suggests.

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America Online and ally Net2Phone are dipping their toes into the Internet-based unified messaging market.

The two companies each took a stake today in small Illinois-based Webley Systems , which offers services such as voice mail, "follow-me" calling that tracks down subscribers to cellular phones, and voice-activated Web browsing over phones.

While the size of the investment is relatively small--just $15 million between the two companies--the move underscores a growing willingness on the part of AOL to move into a communications sphere once dominated by traditional telephone companies.

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Sonicbox Inc. Tuesday released its iM Software Tuner, giving Internet users easy access to streaming radio stations.

"Sonicbox was founded to make listening to 'best of planet' Internet radio as simple as possible, said Niko Bolas, President and CEO of Sonicbox Inc. "The iM Software Tuner is our first step toward listeners being able to experience Internet radio anytime and anywhere, making it a part of their life - stay tuned."

With pushbutton e-commerce capability and targeted one-to-one ad insertion, Sonicbox offers radio stations new revenue opportunities and advertisers access to highly targeted listeners via an Internet-extended cluster model.

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Hewlett-Packard Tuesday launched a range of new services called Global Security Consulting Services, aimed at helping customers define an e-security strategy, review their current e-security products, and integrate them into their existing business. The launch was announced here at the Infosecurity show Tuesday.

"We estimate that these consulting services will generate four times the revenue of all our products this year," said Roberto Medrano, general manager of HP's Internet security solutions division. "Next year we estimate that the consulting services will generate six to seven times the revenue of the products."

Although Medrano has high goals for e-security services revenue, he didn't disclose an exact figure. The new consulting services will employ between 100 and 200 people in Europe this year, according to Medrano.

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What's in a name? If it's an Internet domain name, maybe millions or dollars--or maybe a trip to court.

Memorable domain names are in short supply, and the prices of sought-after ones are skyrocketing. Late last year, for example, the name "business.com" sold for a record $7.5 million.

While mere mortals may scratch their heads over the price, at least that deal was legitimate.

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Juno Online Services said it agreed to offer its email and Internet service through the high-speed wireless network being built by Metricom.

"Our goal is to make it possible for anyone to access Juno anywhere," Charles Ardai, Juno's president and chief executive, said in a statement.

Juno said it will become one of the first Internet access providers to use Metricom's radio-frequency Ricochet network, which allows computer users to access the Web without plugging into anything. Metricom uses a network of microcell radios that are typically attached to streetlights or utility poles to deliver the Internet at twice the speed of dial-up modems, Juno said.

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Coca-Cola said today that it will sell its branded merchandise on a new Web site by early summer. It's the first of many online ventures that the company has planned in order to extend what is already one of the world's strongest brands.

More than a year in the making, the site will take Coca-Cola's $1 billion-plus merchandising business online in an attempt to reinforce the company's brand. The company operates four stores and sells licensed merchandise through retailers such as Wal-Mart and FAO Schwarz.

The Coke brand consistently ranks among the most robust worldwide, but the company has been slow to embrace the Net as a marketing channel. Coca-Cola has recently renewed its focus on innovation as a reacting to poor performance in recent years.

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America Online Inc. launched the latest volley in the instant messaging war Monday by adding voice communication and image sharing to version 4.0 of its AOL Instant Messenger.

Released for Windows and Macintosh, AIM 4.0 features AIM Talk, which enables online voice communication between AIM users from any Internet-enabled PC. This feature is integrated into AIM so that users can check to see who is online and make a call with a single click.

Instant Images lets users send and receive photos, images and sounds to one another, adding a new dimension to instant online communications. Also among the new version features is a new batch of Buddy icons, which let users personalize messages and a suite of "alert" tools that give users the heads-up on e-mails, stocks, and Buddy calls.

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While vendors stumble over one another to offer the latest personalization technology, privacy advocates are worried that advancements in e-commerce services have a steep price: the integrity of a person's identity.

"I don't want to live in a world that tracks my every move just because I like to have a cell phone," said Austin Hill, CEO of Montreal-based Zero-Knowledge Systems Inc., at his opening keynote at the Computers, Freedom and Privacy 2000 conference in Toronto earlier this week. "Privacy is the civil rights and environmental movement of the 21st century."

Hill's company is doing its part with Freedom 1.1, a just-released upgrade to i