News Corp will use $3.2bn of the cash it had stored up(router,verizon wireless,wireless network,wireless internet,i phone,i phone verizon,my verizon wireless,wireless adapter,att wireless)
for the acquisition of British Sky Broadcasting to boost its share buyback programme from $1.8bn to $5bn, in Rupert Murdoch’s latest dramatic response to a crisis that has weighed heavily on the media group’s shares.
The unexpected Tuesday morning announcement is likely to be welcomed by investors and analysts who have long argued for larger buybacks, but is unlikely to dent News Corp’s ability to afford the 61 per cent of BSkyB it does not already own.
On Monday, News Corp opted for a longer review of that deal at the hands of the UK Competition Commission, rather than face a hostile political climate in which ministers were coming under growing pressure to intervene in the deal and other regulators were being asked whether News Corp was a “fit and proper” media owner.
The expanded buyback programme, which will be made over the coming 12 months, is News Corp’s latest tactical response to a spreading legal, political and corporate crisis emanating from allegations of phone hacking on its News of the World tabloid Sunday newspaper.
Last week, James Murdoch, head of News Corp Europe and Asia, announced that it would close the London title, and, on Monday, News Corp withdrew the concessions that would have averted a Competition Commission investigation that could take six months to a year.
News Corp can easily afford the buyback, analysts said, with annual free cashflow of about $1.3bn, and net debt at just 0.3 times estimated 2012 earnings before interest, tax, depreciation and amortisation (ebitda).
One analyst estimated that its planned purchase of BSkyB would have taken net debt to just 2.3 times ebitda, and that the multiple would rise to a still manageable three times with the larger buyback.
The likely delay left News Corp facing the prospect of having more than $10bn of unused cash on its balance sheet for another year. The buyback may aso have the effect of shoring up the Murdoch family’s control of the company, if they tender none of their own shares to the programme.
News Corp’s dual class stock gives Murdoch family trusts control of just under 40 per cent of the voting rights with a far smaller equity stake.
News Corp shares, which suffered their biggest daily loss since April 2009 on Monday, opened up as much as 3.5 per cent in New York on Tuesday to $16.57.
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Showing posts with label Times. Show all posts
Showing posts with label Times. Show all posts
Tuesday, 12 July 2011
With Sonic, GM Stands Automaking on Its Head - New York Times
The production line has been squeezed into(router,verizon wireless,wireless network,wireless internet,i phone,i phone verizon,my verizon wireless,wireless adapter,att wireless)
half the space of a traditional plant. Welding robots are concentrated in efficient clusters, instead of being spaced along the line, while many of the workers earn half the typical union wage. Even the first coat of rust-proofing has been reformulated so that it is one-hundredth as thick as — and thereby cheaper than — the coating on other cars.
One of the oldest axioms in the auto industry is that no company can build a subcompact car in the United States and make money because they are priced too low. The Ford Fiesta is built in Mexico. The Honda Fit is made in several places, including China and Brazil. But(router,verizon wireless,wireless network,wireless internet,i phone,i phone verizon,my verizon wireless,wireless adapter,att wireless)
with Americans — and Detroit — rediscovering small cars because of high gasoline prices, General Motors is intent on shattering that notion with its new Chevrolet Sonic. Not only does it give G.M. a new entry in the lowest tier of the market when it goes on sale this fall, the Sonic is expected to be a breakthrough in establishing a new level of cooperation between Detroit and the United Automobile Workers.
The radically revamped factory here operates with fewer and cheaper workers, many of whom are paid $14 an hour rather than the full U.A.W. wage of $28 an hour.
The plant itself is smaller and reconfigured to save money, with company executives modeling some of the changes after G.M.’s most efficient factories in Germany and Korea. The production line’s footprint alone was reduced from 1 million square feet to 500,000 — the equivalent of losing the space of more than two Wal-Mart Super Stores. The energy bill was cut by powering some operations with methane gas from neighboring landfills.
The Sonic will be G.M.’s littlest, and most fuel-efficient, conventionally powered vehicle. It was conceived in 2008 before the federal government’s bailout of the bankrupt automaker, when negotiators from the company and the union began brainstorming about what it would take to make a profitable subcompact car in the United States rather than in low-wage countries.
“We wanted to prove we could do it,” said Diana D. Tremblay, G.M.’s head of labor relations , “and we went into it with an open mind.”
The U.A.W. tried to persuade the Ford Motor Company to build the Fiesta subcompact in the United States. But Ford chose a plant in Mexico, where the combined wages and benefits of a production worker total less than $10 an hour. By contrast, a full-wage union member in the United States costs G.M. close to $60 an hour. Even an entry-level wage employee costs about $30 an hour in wages and benefits.
While it is not the only factor in producing a profitable subcompact, lower employment costs were critical to the decision to build the Sonic in Michigan. In a groundbreaking labor agreement, the union allowed G.M. to pay 40 percent of its union workers at Orion Township an “entry-level” wage that sharply reduces overall production costs.
“The entry-level wage structure was an important enabler, because obviously the smaller the car the less the margin,” said Ms. Tremblay.
The U.A.W.’s president, Bob King, said the union considered the significance of a competitive subcompact to G.M.’s overall product lineup. The Sonic is the first subcompact that G.M. has tried to build in its home market since the Chevrolet Chevette almost 40 years ago, aside from a brief joint effort with Toyota to build Geo Prisms. The smallest car in its lineup now is the Chevrolet Aveo, a subcompact developed by G.M.’s South Korean subsidiary.
“We are committed to the success of the company,” Mr. King said recently. “We had to talk about a business model that makes sense.”
For all its promise, the Sonic still has to convince consumers that G.M. has found the right formula for an attractive and affordable subcompact. Previous efforts like the Geo Prism and the Aveo were bland and underpowered, and contributed to G.M.’s lackluster reputation in the overall car market.
“G.M. has a lot to prove with the Sonic," said Joseph Phillippi of the research firm Auto Trends . "They have to cut costs but still put out a competitive car."
The car itself is a mosaic of innovation to make the Sonic lighter, less costly and more fuel-efficient, including high-strength steel used in its windshield pillars and the ultra-thin film applied to prevent rust. The Sonic sedan resembles a shrunken version of the Cruze, while the hatchback version is distinguished by its short rear overhang and upright stance.
The Sonic weighs 500 pounds less and is eight inches shorter than the next biggest car G.M. makes, and its little 1.4-.liter turbocharged engine will deliver the best gas mileage in the company’s fleet. “It will be north of 40 miles per gallon,” said Jim Federico, head of G.M.’s global small cars and electric vehicles.
Still, to get the car to meet cost-saving goals, a team of G.M. engineers and manufacturing specialists also had to adapt and reconfigure the Orion plant. It opened in 1983, and was used to build big cars like the Buick Riviera in the 1990s. It nearly closed two years ago, when three other large assembly plants were shut down to reduce capacity.
G.M. spent heavily in converting the plant, investing $545 million in new equipment and retraining workers — and it shows, from the gleaming floors to the banks of fluorescent lighting that brighten the plant and save $430,000 a year in energy costs. The plant is also the company’s greenest, producing 80 percent less solid waste and using 20 percent less water, all at a savings.
Various stages along the assembly line, like the body shop and trim area, are more compact, with teams of six workers installing parts fed to them on automated carts by independent suppliers who operate inside the plant. That reduces costly inventory and improves productivity. “Normally the suppliers would be five miles away versus 50 feet,” said John Barry, a G.M. manager.
The plant over all employs 1,800, a reduction of 25 percent. To augment the small profit earned on the Sonic, the workers will also make the larger, more upscale Buick Verano on the same line. Even the shifts have been fine-tuned to four 10-hour days rather than the usual five-day week to save wear and tear on the machinery.
Every dollar saved is essential for the Sonic to compete, auto experts said. And if the car is a winner with consumers — production begins in August — Orion Township could become a model.
“This plant has the potential to redefine American manufacturing,” said Harley Shaiken, a labor professor at the University of California, Berkeley. “A success here indicates untapped capabilities.”
View the original article here
half the space of a traditional plant. Welding robots are concentrated in efficient clusters, instead of being spaced along the line, while many of the workers earn half the typical union wage. Even the first coat of rust-proofing has been reformulated so that it is one-hundredth as thick as — and thereby cheaper than — the coating on other cars.
One of the oldest axioms in the auto industry is that no company can build a subcompact car in the United States and make money because they are priced too low. The Ford Fiesta is built in Mexico. The Honda Fit is made in several places, including China and Brazil. But(router,verizon wireless,wireless network,wireless internet,i phone,i phone verizon,my verizon wireless,wireless adapter,att wireless)
with Americans — and Detroit — rediscovering small cars because of high gasoline prices, General Motors is intent on shattering that notion with its new Chevrolet Sonic. Not only does it give G.M. a new entry in the lowest tier of the market when it goes on sale this fall, the Sonic is expected to be a breakthrough in establishing a new level of cooperation between Detroit and the United Automobile Workers.
The radically revamped factory here operates with fewer and cheaper workers, many of whom are paid $14 an hour rather than the full U.A.W. wage of $28 an hour.
The plant itself is smaller and reconfigured to save money, with company executives modeling some of the changes after G.M.’s most efficient factories in Germany and Korea. The production line’s footprint alone was reduced from 1 million square feet to 500,000 — the equivalent of losing the space of more than two Wal-Mart Super Stores. The energy bill was cut by powering some operations with methane gas from neighboring landfills.
The Sonic will be G.M.’s littlest, and most fuel-efficient, conventionally powered vehicle. It was conceived in 2008 before the federal government’s bailout of the bankrupt automaker, when negotiators from the company and the union began brainstorming about what it would take to make a profitable subcompact car in the United States rather than in low-wage countries.
“We wanted to prove we could do it,” said Diana D. Tremblay, G.M.’s head of labor relations , “and we went into it with an open mind.”
The U.A.W. tried to persuade the Ford Motor Company to build the Fiesta subcompact in the United States. But Ford chose a plant in Mexico, where the combined wages and benefits of a production worker total less than $10 an hour. By contrast, a full-wage union member in the United States costs G.M. close to $60 an hour. Even an entry-level wage employee costs about $30 an hour in wages and benefits.
While it is not the only factor in producing a profitable subcompact, lower employment costs were critical to the decision to build the Sonic in Michigan. In a groundbreaking labor agreement, the union allowed G.M. to pay 40 percent of its union workers at Orion Township an “entry-level” wage that sharply reduces overall production costs.
“The entry-level wage structure was an important enabler, because obviously the smaller the car the less the margin,” said Ms. Tremblay.
The U.A.W.’s president, Bob King, said the union considered the significance of a competitive subcompact to G.M.’s overall product lineup. The Sonic is the first subcompact that G.M. has tried to build in its home market since the Chevrolet Chevette almost 40 years ago, aside from a brief joint effort with Toyota to build Geo Prisms. The smallest car in its lineup now is the Chevrolet Aveo, a subcompact developed by G.M.’s South Korean subsidiary.
“We are committed to the success of the company,” Mr. King said recently. “We had to talk about a business model that makes sense.”
For all its promise, the Sonic still has to convince consumers that G.M. has found the right formula for an attractive and affordable subcompact. Previous efforts like the Geo Prism and the Aveo were bland and underpowered, and contributed to G.M.’s lackluster reputation in the overall car market.
“G.M. has a lot to prove with the Sonic," said Joseph Phillippi of the research firm Auto Trends . "They have to cut costs but still put out a competitive car."
The car itself is a mosaic of innovation to make the Sonic lighter, less costly and more fuel-efficient, including high-strength steel used in its windshield pillars and the ultra-thin film applied to prevent rust. The Sonic sedan resembles a shrunken version of the Cruze, while the hatchback version is distinguished by its short rear overhang and upright stance.
The Sonic weighs 500 pounds less and is eight inches shorter than the next biggest car G.M. makes, and its little 1.4-.liter turbocharged engine will deliver the best gas mileage in the company’s fleet. “It will be north of 40 miles per gallon,” said Jim Federico, head of G.M.’s global small cars and electric vehicles.
Still, to get the car to meet cost-saving goals, a team of G.M. engineers and manufacturing specialists also had to adapt and reconfigure the Orion plant. It opened in 1983, and was used to build big cars like the Buick Riviera in the 1990s. It nearly closed two years ago, when three other large assembly plants were shut down to reduce capacity.
G.M. spent heavily in converting the plant, investing $545 million in new equipment and retraining workers — and it shows, from the gleaming floors to the banks of fluorescent lighting that brighten the plant and save $430,000 a year in energy costs. The plant is also the company’s greenest, producing 80 percent less solid waste and using 20 percent less water, all at a savings.
Various stages along the assembly line, like the body shop and trim area, are more compact, with teams of six workers installing parts fed to them on automated carts by independent suppliers who operate inside the plant. That reduces costly inventory and improves productivity. “Normally the suppliers would be five miles away versus 50 feet,” said John Barry, a G.M. manager.
The plant over all employs 1,800, a reduction of 25 percent. To augment the small profit earned on the Sonic, the workers will also make the larger, more upscale Buick Verano on the same line. Even the shifts have been fine-tuned to four 10-hour days rather than the usual five-day week to save wear and tear on the machinery.
Every dollar saved is essential for the Sonic to compete, auto experts said. And if the car is a winner with consumers — production begins in August — Orion Township could become a model.
“This plant has the potential to redefine American manufacturing,” said Harley Shaiken, a labor professor at the University of California, Berkeley. “A success here indicates untapped capabilities.”
View the original article here
Monday, 11 July 2011
News of the World ends: Will Murdoch's News Corp BSkyB bid follow? - International Business Times
With the News of the World newspaper's phone hacking scandal still fresh in the public's mind, British government lawyers have reportedly begun planning ways to block Rupert Murdoch's BSkyB bid.
The lawyers activities were revealed in a report from the Independent. The news came just after opposition Labour part leader Ed Miliband promised that he would try to force Parliament to vote on the BSkyB take-over this week, should acting Prime Minister David Cameron fail to take measures to stop the take-over bid.
The bid would see the Murdoch owned News Corp bid $14 billion for the remaining 61 per cent of BSkyB it doesn't currently own.
If taken to vote Reuters analysts have speculated the end of the new Liberal Democrat, Conservative coalition. Citing the Lib Dem's hostile relationship with many of Murdoch's news outlets, which have tended to portray the party in a less than favourable light.
The calls to halt the bid come just after a slew of phone hacking allegations against the now discontinued News of the Wold newspaper. The News Corp owned paper was accused of hacking into the phones of numerous individuals including celebrities, politicians and murder victims.
The case came to a head when the paper was accused of hacking the phone of murdered school girl Milly Dowler.
The scandal lead to a public backlash against both the paper and News Corp. In response Murdoch personally discontinued the paper -- choosing to keep the head of News Corp's British newspaper division, Rebekah Brooks.
Though Downing Street has declined on the future of the BSkyB bid, the Independent has quoted a senior government source as revealing to it that, "We [the government] are working on a plan to suspend the deal while the police investigation is taking place."
The News of the World's phone hacking activities were first reported in 2007 by the, also Murdoch owned, Sunday Times. The paper reported that its own internal investigation had discovered News of the World staff paying police for information to aid them in the hacks.
In its report the Independent indicated that the government had hoped that the U.K. broadcasting regulator Ofcom would block the BSkyB takeover on the grounds that News Corp directors were not "fit and proper" to run the company.
The alternative strategy, would see lawyers from the department of Culture work to block the deal using the country's competition criteria laws.
The news comes just after PM David Cameron finally joined the cacophony of voices calling for Brooks to step down. A public enquiry has already been ordered.
NYC 'Artist' visited by Secret Service - International Business Times
Jul 09, 2011 06:09 PM EDT
A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr 
A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr 
A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr 
A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr 
A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr 
A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr 
A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr 
A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr 
A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr 
A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr 
A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr 
A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr 
A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr 
A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr
A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service this week.
Kyle McDonald used the built-in cameras on Macbooks and other Apple products to capture images of about 1,000 people as they examined new Apple computers.
His computers, iPod and digital storage devices were confiscated as authorities conduct their investigation.
"@secretservice just stopped by to investigate peoplestaringatcomputers.tumblr.com and took my laptop. please assume they're reading any emails you send me," McDonald said via Twitter Thursday.
Over the course of three days, McDonald installed his homegrown software, which captured photos every minute and sent them to his server.
Reports said that McDonald did this across computers at nearly 100 stores. He said he had the permission of Apple security guards.
In early July, he arranged an unauthorized exhibition at two Apple stores where customers were first shown a picture of themselves and then photos of other Apple store visitors.
"We have this expression on our face [when we use computers] that basically says that we're not interacting with anybody, we're interacting with the machine," McDonald said of the project.
"Even if there are a lot of people in the room at the Apple store, you're not interacting with them. If something weird happens, you don't say, 'Hey, did you see that?'"
Regarding the case itself, McDonald, said that he had been advised not to comment on the case by the online freedom group the Electronic Frontier Foundation.
See a sampling of the photos below, or click here for a slideshow of all the works
A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr A New York City "artist," who installed spyware onto public computers to snap photos of customers in Apple stores was visited by US Secret Service on week.Source: Tumblr What HTC's Thunderbolt means for the iPhone 5 - International Business Times
With the next generation iPhone 5 on it's way from Apple, enthusiasts and analysts are looking to glean any clues as to what will be packed into the anticipated phone.
With regards to a few important aspects, clues have come from a surprising source -- Apple rival HTC with its Thunderbolt 4G phone.
With its fast 4G advantage, the phone sports the highest component costs of any other smartphone, and even rivals some tablets.
But it's that same 4G technology that allows industry watchers to understand some of the challenges that Apple is facing as it builds out its iPhone 5.
The 4G Long Term Evolution (LTE) wireless chips required for the faster speeds in the Thunderbolt cost an extra $39.75, according to industry researcher IHS.
This presents a problem for Apple, which observers believe is mulling adding the capability to its forthcoming iPhone 5.
There are some options.
Apple could forgo 4G technology all together. Indeed some analysts have predicted just as much, given the current chips are relatively new technology that haven't been 100 percent proven.
The company has already dropped hints, saying at a Verizon press conference in January that it will be conservative with the implementation of LTE, primarily because of battery and other concerns that didn't meet Apple's demands.
On the other hand, there are already three models of LTE phones on the market from competitors Samsung, and LG, as well as HTC's Thunderbolt.
To combat, Apple would certainly need a 4G offering, but would need to make some sacrifices given the size and cost of the chip.
"First, the iPhone's minuscule printed circuit board (PCB) will have to grow in size in order to support the first-generation LTE baseband processor as well as all the supporting chipset," explained firms senior analyst, Wayne Lam.
"Second, the next iPhone's BOM value certainly will increase substantially compared to the iPhone 4 if LTE is implemented in the same manner as in the HTC Thunderbolt."
The current iPhone 4 costs $171.35 to make, meaning the addition would run costs up to roughly $211 per unit, cutting down on Apple's margins, which could be passed on to the consumer.
But seeing that Apple executives have publically complained about the poor designs of current LTE chips, Apple could opt to use someone else entirely.
Enter the Qualcomm's "SnapDragon MSM8960." The chip is the newer version to the 4G chip in the Thunderbolt, and features a number of advantages over standard 4G implementations.
It combines LTE, the "EVDO" standard for existing CDMA networks, and the GSM standard used at AT&T, in one chip, allowing Apple to sell one iPhone 5 that can run on multiple networks.
Currently it sells one for AT&T and one for Verizon.
Given the iPhone 5 is expected to ship a lot more units than HTC's Thunderbolt, Apple has the advantage of pushing down prices even more.
"I would imagine the caveat would have to be added that strict cost of components may vary between Apple and HTC, given Apple's purchasing power in the semiconductor market," Lam says.
The iPhone 5 is expected in Q4 this year.
MUST READ: Apple iPhone 5 versus top 10 Android super smartphones (the ULTIMATE smartphone war)
Saturday, 9 July 2011
To Slow Piracy, Internet Providers Ready Penalties - New York Times
After years of negotiations with Hollywood and the music industry, the nation’s top Internet providers have agreed to a systematic approach to identifying customers suspected of digital copyright infringement and then alerting them via e-mail or other means.
Under the new process, which was announced Thursday, several warnings would be issued, with progressively harsher consequences if the initial cautions were ignored.
The companies took pains to say that the agreement did not oblige Internet providers to shut down a repeat offender’s account, and that the system of alerts was meant to be “educational.” But they noted that carriers would retain their right to cut off any user who violated their terms of service.
In bringing together the media companies and Internet carriers, the deal demonstrates how the once-clear line separating those two businesses has been blurred. Eight years ago, the Recording Industry Association of America had to sue Verizon to try to uncover the identity of a customer who was sharing music online. This year, Comcast completed its merger with NBC, bringing an owner of digital content and a conduit for it under the same roof.
Now the Internet providers are hoping to profit as they pipe music and video of the nonpirated variety to their customers.
“The I.S.P.’s want to cooperate with Hollywood because the carriers recognize that their own growth depends in part on bundled content strategies,” said Eric Garland of BigChampagne, which tracks online media traffic. “They don’t want to be just utilities providing Internet access, but premium content distributors as well.”
The system announced on Thursday involves a series of six warnings that an Internet provider can send to a customer whom the media companies have identified as a possible copyright infringer.
The warnings escalate from simple e-mail notifications to, at levels 5 and 6, a set of “mitigation measures,” like reduced connection speeds or a block on Web browsing. As the alerts progress, a customer must acknowledge that he understands the notice. Customers will also have the opportunity to contest the complaint.
The effect on consumers, the companies hope, will be more of a deterrent-by-annoyance — rather than the random lightning bolt of litigation that was once the preferred method of enforcement by the recording industry association, one of the parties to the agreement.
The media companies were also represented by the Motion Picture Association of America and groups acting on behalf of independent record companies and filmmakers. The Internet carriers involved in the deal include AT&T, Cablevision, Comcast, Verizon and Time Warner Cable.
The music and movie companies, which estimate that digital piracy costs the United States economy $16 billion in lost revenue each year, have been eager for an efficient way to deal with the problem.
As illegal downloading has become ingrained as a cultural habit, especially among young people, expensive litigation has become less effective, and the lawsuits against individuals were something of a public relations disaster for the music companies. The new deal, the companies say, offers plenty of chances for even the most recalcitrant pirates to reform.
“This is a sensible approach to the problem of online content theft and, importantly, one that respects the privacy and rights of our subscribers,” Randal S. Milch, executive vice president and general counsel for Verizon, said in a statement.
The agreement has an unlikely origin: it came about as a result of an effort to crack down on child pornography that was led by Andrew M. Cuomo while he was the New York attorney general.
Steve Lohr contributed reporting.
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