It’s clear that Internet TV “is becoming increasingly mainstream and traditional media companies are adjusting to the shift from linear to on-demand viewing,” Netflix CEO Reed Hastings and Chief Financial Officer David Wells said Wednesday in their quarterly letter to shareholders. “It is a great time to be a creator of content because studios make content to sell content (not to withhold it) and there are new bidders for their product,” they said. Some studios “will choose to license content” to subscription-based VOD (SVOD) services like "Hulu, Amazon Prime Instant Video and Netflix,” but “others may not,” they said. “We have a lot of content to select from.” The “competitive landscape remains vibrant” as Netflix competes with many forms of entertainment for consumers’ leisure time, they said. SVOD services “continue to evolve,” and they remain “active bidders for content, in addition to all the cable networks around the world,” they said. “Linear networks that embrace on demand and Internet delivery as we have, will become more valuable and will experience renewed growth (like HBO Now), while those that do not will lose relevancy,” they said. “The secular shift to on-demand consumption is best described as ‘consumers evolving vs. old habits’ rather than ‘Netflix vs. traditional media.’ We’re all racing to fulfill consumer desires.”

The co-chairmen of ICANN's Cross Community Working Group on Enhancing ICANN's Accountability (CCWG-Accountability) reported Wednesday that there continues to be “some disagreement” among the group's members on how to proceed on several key proposed changes to ICANN's accountability mechanisms ahead of ICANN's planned meeting in Dublin, which is set to run from Saturday through Oct. 22. Areas of disagreement center on proposals for a mechanism for enforcing proposed new ICANN community powers and a proposal to amend ICANN's bylaws to require the ICANN board to find a “mutually acceptable solution” when the Governmental Advisory Committee provides advice that’s supported by GAC member consensus, the CCWG-Accountability co-chairmen said in a blog post. Those issues were among several that remained unresolved following CCWG-Accountability's two-day meeting last month in Los Angeles (see 1509280056) and subsequent teleconferences. A significant number of other provisions in the CCWG-Accountability proposal also need further revisions “but we are confident that these refinements can be provided shortly to meet stakeholder expectations,” the group's co-chairmen said. CCWG-Accountability is investigating whether a two-phase plan for implementing “community empowerment” would be feasible, as such a plan “could help accommodate” concerns with the existing proposal, the co-chairmen said. CCWG-Accountability is “committed to make great strides during the Dublin meeting,” the co-chairmen said. “We are aware that the finalization of our recommendations is the last missing piece in the IANA Stewardship Transition puzzle and we take this responsibility very seriously.”

Twitter’s 8 percent workforce reduction, announced to employees in a letter and in an 8-K SEC filing Tuesday, had been rumored in tweets going back to Friday. CNBC reported companywide layoffs in the week ahead as Jack Dorsey moved from interim to permanent CEO. Twitter said in the 8-K that the board voted Monday to cut 336 members of its global workforce as part of a plan “to organize around the Company’s top product priorities and drive efficiencies throughout the Company.” Twitter plans to reinvest savings in its most important priorities to drive growth, it said. Severance costs are expected to run between $10 million and $20 million, with restructuring expenses estimated to be $5 million to $15 million. In the employee letter, Dorsey said the restructuring would put the company “on a stronger path to grow.” Dorsey referred to a “streamlined roadmap” for Periscope, Twitter and Vine and a focus on experiences expected to have the greatest impact. One of those experiences, Moments, launched last week with “a great beginning” giving a “bold peek into the future of how people will see what’s going on in the world,” Dorsey said. Cuts will affect product and engineering teams the most, he said. Engineering will remain the biggest percentage of the workforce but will "move much faster with a smaller and nimbler team," Dorsey said. Twitter users commented on the news, led by Dorsey, whose Twitter handle is Jack: “Made some tough but necessary decisions that enable Twitter to move with greater focus and reinvest in our growth.” Anita B. wondered if the social media upward trend is “slowing down.” Jischinger observed: #twitterlayoffs not trending.” B_Meson pointed to Dorsey’s promise in his letter to “give it to you straight” rather than using corporate speak while following with the term “streamlined.” Predictable Twitter humor ensued: Zach Zimmerman said: “We’re limited to 129 characters now.”

The FBI issued an alert Thursday warning consumers and merchants that the new microchip-enabled credit cards are still susceptible to fraud. Instead of relying on a magnetic strip to store data, the new EMV (EuroPay, MasterCard, Visa) chip cards “verify the card’s authenticity by the cardholder’s personal identification number (PIN)” and “transmit transaction data between the merchant and the issuing bank with a special code that is unique to each individual transaction,” the alert said. EMV cards provide more security than traditional magnetic strip cards, but are still vulnerable to fraud, the alert said. “EMV cards can be counterfeited using stolen card data obtained from the black market,” it said. The data on the magnetic strip of an EMV card can be stolen if the point-of-service terminal is infected with data-capturing malware, and the chip won’t stop stolen or counterfeit credit cards from being used for online or telephone purchases, it said.

Ahead of Open Enrollment beginning on HealthCare.gov on Nov. 1, Centers for Medicare & Medicaid Services (CMS) Marketplace CEO Kevin Counihan announced changes made to the site and enrollment process to protect consumer privacy. Effective Friday, CMS launched a new privacy manager to give consumers “more control over the information you choose to share with us,” Counihan said in a blog post Friday. “This simple tool makes it easy for you to opt-in or out of the different types of third-party tools used by HealthCare.gov -- Advertising, Analytics, or Social Media,” Counihan said. “If you choose to opt-out, you’ll still have access to everything on the site, but we won’t use information from your visit to analyze the site’s technical performance or use digital advertising to remind you about helpful information like deadlines,” he said. “We’re also supporting the Do Not Track browser setting for our digital advertising,” he said. CMS updated its privacy notice to reflect these changes and help consumers understand how CMS is working to protect their privacy, Counihan said. Personal information including name, Social Security number and income are collected when signing up for healthcare coverage, and CMS takes “protecting this type of personal information very seriously and only use[s] it to help you get -- and keep -- your coverage,” Counihan said. CMS receives some information automatically when the site is used so CMS understands how the site is being used, and uses tools like Google Analytics to analyze the site’s technical performance and effectiveness of digital advertising outreach efforts, Counihan said.

California Gov. Jerry Brown (D) signed the California Electronic Privacy Communications Act (CalECPA SB-178) into law Thursday. The bill “protects Californians against warrantless law enforcement access to private electronic communications such as emails, text messages and GPS data that are stored in the cloud and on smart phones, tablets, laptops and other digital devices,” said one of the bill’s author’s, state Sen. Mark Leno (D), in a news release. CalECPA has support from Silicon Valley’s major tech companies, including Apple, Facebook, Google and Twitter, which have “seen a dramatic rise in requests from law enforcement for consumer data in recent years,” the release said. “Google has seen a 180 percent jump in law enforcement demands for consumer data in the past five years,” it said. “Last year, AT&T received 64,000 demands -- a 70 percent increase in a single year,” it said. “Verizon reports that only one-third of its requests had a warrant, and last year Twitter and Tumblr received more demands from California than any other state,” the release said. American Civil Liberties Union Technology & Civil Liberties Policy Director Nicole Ozer called Brown’s decision to sign the legislation into law a “landmark win for digital privacy,” in an ACLU news release. California now joins Maine, Texas, Utah and Virginia in updating privacy laws for the digital age, Leno's news release said. The ACLU hopes California’s legislation is used as a “model for the rest of the nation in protecting our digital privacy rights,” Ozer said. The Electronic Frontier Foundation and Center for Democracy & Technology also released statements supporting Brown’s decision to sign the legislation.

ISPs should disclose Internet traffic differentiation practices that affect end-user access, implement efficient network resource management practices, and not disrupt user-selected security in order to apply differentiated treatment, said a report issued Thursday by the Broadband Internet Technical Advisory Group. The report focuses on nitty-gritty technical issues concerning the protocols and policies of network operators engaging in differentiated treatment of traffic -- not the public policy disputes in the FCC's net neutrality order such as paid prioritization (though the disclosure recommendation echoes the agency's broadband provider transparency rule, which is less controversial). Differentiation refers to "the full range of treatments" that can be applied to manage Internet traffic flows beyond a "first in, first out" basis, the report said. "This treatment may determine the order in which routers and switches send packets from different flows across the link, the rate of transmission of a given flow, or even whether certain packets are sent at all," it said. "While the techniques used for traffic differentiation overlap with those used to manage congestion, differentiation has a broader purpose that includes meeting service level agreement (SLA) guarantees and selecting paths for traffic from different applications, among other things. Differentiated treatment of traffic can also contribute both to the efficiency of a network and to the predictability of the manner in which network resources are shared." The report said traffic differentiation is extensively used within individual networks but hasn't been implemented across provider networks. "End to end deployment would require the harmonization and cooperation of a large number, if not all, of the relevant network operators," it said.

ICANN began collecting comments on two-character ASCII domain name labels as it considers whether to authorize the release of requested two-character domains it had previously withheld from authorization. ICANN's current registry agreement allows the release of such domains if measures are in place to “avoid confusion with the corresponding country codes.” Input from governments and registries will help ICANN “draft criteria for evaluating whether measures identified by a registry operator successfully mitigate concerns raised which relate to confusion with a related government's corresponding country code,” ICANN said Tuesday. “These criteria will be available for public comment prior to final adoption.” Comments are due to ICANN by Dec. 5.

Allowing encryption back doors would create security risks, economic problems for the tech sector and privacy concerns for citizens and international allies, wrote Computer & Communications Industry Association CEO Ed Black in a letter to President Barack Obama Wednesday, a CCIA news release said. There is “ongoing discussion” within the administration “regarding the growing availability of strong encryption in consumer products and communications systems, and the implications this might have for criminal and counterterrorism investigations,” Black said. Back doors “rarely remain secure and instead become means for unlawful access by criminals or others inclined to misuse such access,” he said. “The global competitiveness of the U.S. tech industry has already been damaged by the last two years of disclosures of mass surveillance by U.S. intelligence agencies,” Black said. “I urge your Administration not just to forgo limitations on its use [of encryption], but to support and promote its adoption worldwide.” TechFreedom, Libertarian think tank Niskanen Center and a coalition of free market groups also sent a letter to the White House Wednesday urging the administration to endorse the use of strong encryption, a news release said. President Barack Obama’s “failure to endorse strong encryption has given ammunition to European regulators seeking to restrict cross-border data flows and require that data on EU citizens be stored in their own countries,” said TechFreedom Policy Counsel Tom Struble. “Just yesterday, the European Court of Justice struck down a longstanding agreement (see 1510060001).that made it easier for Europeans to access American Internet services,” Struble said. “If the White House continues to dawdle, it will only further embolden ‘digital protectionism’ across the pond.”

NCTA defended the controversial Cybersecurity Information Sharing Act (S-754) Wednesday, saying concerns about how the bill would affect privacy and civil liberties protections “have been heard and important changes have been made to the bill to ensure it can in no way be misused as a 'surveillance' bill.” S-754 is likely to return to the Senate floor after Congress' upcoming one-week recess after months of negotiations to assuage critics' concerns about the bill, though privacy advocates are continuing to oppose it (see 1510060046). S-754's “scope is extremely narrow, and specifically aimed at protecting business, individuals, and critical Internet infrastructure from malicious cyber attacks,” NCTA said. “It does this by allowing companies to share cyber threat indicators, or CTIs, with other companies and the DHS portal in real time through a mandated automated process.”