Exclusive: Amazon to win e-book tussle with Apple

BRUSSELS (Reuters) - European Union regulators are to end an antitrust probe into e-book prices by accepting an offer by Apple and four publishers to ease price restrictions on Amazon, two sources said on Tuesday.

The decision hands online retailer Amazon victory in its attempt to sell e-books cheaper than its rivals in the fast-growing market that publishers hope will boost revenue and increase customer numbers.

Apple and the publishers offered in September to let retailers set their own prices or discounts for a period of two years, and also to suspend "most-favored nation" contracts for five years.

Such clauses bar Simon & Schuster, News Corp. unit HarperCollins, Lagardere SCA's Hachette Livre and Verlagsgruppe Georg von Holtzbrinck, the owner of German company Macmillan, from making deals with rival retailers to sell e-books more cheaply than Apple.

The agreements, which critics say prevent Amazon and other retailers from undercutting Apple's charges, sparked an investigation by the European Commission in December last year.

Pearson Plc's Penguin group, which is also under investigation, did not take part in the offer.

The EU antitrust authority, which in September asked for feedback from rivals and consumers about the proposal, has not asked for more concessions, said one of sources.

"The Commission is likely to accept the offer and announce its decision next month," the source said on Tuesday.

Antoine Colombani, spokesman for competition policy at the European Commission, said: "We have launched a market test in September and our investigation is still ongoing."

Amazon declined to comment, while Apple did not respond to an email for comments.

Companies found guilty of breaching EU rules could be fined up to 10 percent of their global sales, which in Apple's case could reach $15.6 billion, based on its 2012 fiscal year.

FROWNING ON ONLINE TRADE CURBS

Antitrust regulators tend to frown on restrictions on online trade and the case is a good example of this policy, said Mark Tricker, a partner at Brussels-based law firm Norton Rose.

"This case shows the online world continues to be a major focus for the Commission. They are looking at lots of different aspects of e-commerce, as this can have such a significant impact on consumers, development and innovation," he said.

"These markets change very quickly and if you don't stamp down on potential infringements of competition rules, you can have significant consequences."

UBS analysts estimate that e-books account for about 30 percent of the U.S. book market and 20 percent of sales in Britain but are minuscule elsewhere. Amazon created demand for e-books when it launched its e-Kindle reader, charging $9.99 for each book.

Apple's agency model let publishers set prices in return for a 30 percent cut to the maker of iPhone and iPad.

The U.S. Department of Justice is also investigating e-book prices. HarperCollins, Simon & Schuster and Hachette recently settled, but Apple, Penguin Group and Macmillan continue to fight the allegations.

(Editing by Rex Merrifield and David Goodman)

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Greece to Vote on $23 Billion in New Cuts

Angelos Tzortzinis for The New York Times

Greeks began two days of nationwide strikes on Tuesday to protest the new austerity measures, which include further cuts to pensions, civil service salaries and social benefits.

ATHENS — Destabilized by scandals yet held together by a lack of alternatives, the Greek government prepared to push a raft of politically toxic new austerity measures through Parliament on Wednesday, a move aimed at securing international financing and ensuring that the debt-wracked nation will remain in the euro zone.

But some members of Prime Minister Antonis Samaras’s fragile three-party coalition government were expected to break ranks and vote against the measures, reviving questions about how long the coalition can hold together.

On the streets, austerity-weary Greeks kicked off two days of nationwide strikes on Tuesday to protest the new measures, which will total $23 billion over the next four years.

The measures, which are expected to pass by a razor-thin margin in Parliament, are required to unlock $40 billion in rescue financing that the country needs to meet expenses. The European Union’s commissioner for economic and monetary affairs, Olli Rehn, said in Brussels on Monday that lenders were on track to release the aid.

But with so many volatile elements in play, including a series of interlocking scandals in Greece that are gaining momentum, analysts said that it was unclear if the Samaras government could survive under the pressure. “All systems are in critical condition, even the smallest thing can destabilize the system or the government,” said Paschos Mandravelis, a columnist for the daily newspaper Kathimerini.

Even as they jockey over a new round of austerity, leaders are under fire for failing to crack down on high-level tax evasion, after they were handed a list two years ago of more than 2,000 Greeks said to have Swiss bank accounts.

Called the Lagarde list, after Christine Lagarde, the International Monetary Fund chief who provided the information, it was published last week by the investigative magazine HotDoc, prompting the arrest and rapid acquittal of the publication’s editor. The entire affair has done substantial damage to the already weakened Socialist party, the second largest in Mr. Samaras’s coalition. Two Socialist finance ministers — Evangelos Venizelos, the current Socialist leader, and George Papaconstantinou, his predecessor — are under fire for failing to act on the list.

Most analysts said that they believed the government would hold up for now. But two other rival parties are gaining ground in opinion polls. If the country were to hold new elections today, the leftist Syriza party — which has risen rapidly from virtual obscurity on a platform of repudiating Greece’s bailout but staying in the euro — would place first, followed by Mr. Samaras’s New Democracy Party, the polls suggest.

Since claiming power in June, Mr. Samaras has labored to restore Greece’s credibility with its European partners, particularly with Chancellor Angela Merkel of Germany, who has insisted that Greece remain a part of the euro zone.

“It’s clear that this government is making all the right noises,” said Mujtaba Rahman, Europe analyst at the Eurasia Group. “They’re much more credible, and creditors are happy with the progress they have made.” Nevertheless, he added, even when the next wave of financial aid arrives, “Greece is not at all out of the woods.”

The new austerity measures, which include further cuts to pensions, civil service salaries and social benefits, are expected to reduce gross domestic product by 9 percent, dealing a new blow to an economy entering its sixth year of recession and likely adding to an unemployment rate already exceeding 25 percent. A total of $17 billion in cuts and tax increases will be put into effect in the next two years. But because the Greek economy is shrinking even faster than expected, an additional $4.5 billion in austerity measures will be required between 2015 and 2016 to meet the country’s fiscal targets.

As matters stand, Greece is still staggering under a mountain of debt, which is expected to rise to 189 percent of gross domestic product in 2013, from 175.6 percent now, as interest piles up on all the loans Greece must repay. The deficit next year is expected to swell as well, to 5.2 percent of G.D.P. from a forecast of 4.2 percent.

Other euro zone governments have discussed forgiving some or part of the nearly $68 billion in loans they made to Greece, a step that many economists regard as inevitable if Greece is ever to emerge from its fiscal straitjacket. But it is considered politically unpalatable, especially in Germany, where Mrs. Merkel faces an election next year.

Niki Kitsantonis contributed reporting.

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Brees, Robinson lead Saints past Eagles 28-13

NEW ORLEANS (AP) — Two teams with the same record. Two teams heading in strikingly different directions.

Drew Brees and the New Orleans Saints appear to be on the rise again.

Michael Vick and the Philadelphia Eagles are down, and nearly out.

Brees threw two touchdown passes, extending his NFL record streak to 51 games in a row, while Vick was sacked seven times and took an awful beating as the Saints romped to a 28-13 victory over the Eagles on Monday night.

Not that Philadelphia didn't have its chances. But four first-and-goals resulted in two measly field goals, a tipped pass led to Patrick Robinson's 99-yard interception return for a New Orleans touchdown, and the Eagles messed up a trick play when they had the home team totally fooled, costing them a score.

"As coaches and as players, we obviously have to do a better job," embattled coach Andy Reid said of the Eagles (3-5), who are mired in a four-game losing streak. "That starts with me."

The Saints (3-5) revolve around Brees, of course, and he played much better than he did the previous week in a 34-14 loss to Denver. But his performance was more efficient than spectacular, as New Orleans seemed intent on proving it's not just a one-man team.

The NFL's worst-ranked running game relied on a trio of backs — Chris Ivory, Mark Ingram and Pierre Thomas — and finished with 140 yards, nearly double its season average. Ivory had a 22-yard touchdown run.

The defense came up with two huge turnovers near its own end zone. There was Robinson's interception and return, which matched Darren Sharper's franchise record. Then, with just over 3 minutes left and the Eagles down to their last gasp, Brent Celek caught a pass at the New Orleans 8 but fumbled it away.

The Saints recovered, and the Superdome celebration was on.

"There are defining moments throughout a season," Brees said. "Big plays, big wins, that kind of bring you together and let you see a vision of what you can be, what you can accomplish. Here we are the midway point. It's gone by fast.

"This," he added, "is the type of momentum we want going into the second half of the season."

Another dismal performance by the Eagles is sure to keep the heat on Vick and Reid.

Vick threw a 77-yard touchdown pass to DeSean Jackson in the third quarter, but that was about the only highlight for the visiting team. The elusive quarterback matched his career high for sacks; he also went down seven times when playing for the Atlanta Falcons against the New York Giants on Oct. 15, 2006.

"It's very frustrating," Vick said. "These are games that we have the opportunity to win, or get back in the game. At this point, everything has to be dead on. You can't miss, and you almost have to be perfect on every drive."

Philadelphia was far from perfect, but sure had plenty of chances. The Eagles outgained New Orleans and finished with 447 yards — the eighth straight team to put up more than 400 on the Saints.

But the offensive line just couldn't keep Vick upright, a problem that got worse after right tackle Todd Herremans went down in the first half with a strained ankle tendon. He didn't return.

"These are correctable mistakes," Reid said, repeating a familiar theme. "With some of those sacks you can look at coverage, and with some of them you can look at play calling, but we have to do better. The bottom line is we have to block the guys and do a better job."

Rubbing salt in the wound, Philadelphia squandered a chance to get back in the game with a unique trick play on a kickoff return. Riley Cooper laid flat in the end zone, unseen by the Saints, then popped up to take a cross-field lateral from Brandon Boykin.

Cooper streaked down the sideline for an apparent touchdown. Only one problem — Boykin's lateral was actually an illegal forward pass by about a yard, and the officials caught it. Cooper stood with his hands on his hips, in disbelief, when he saw the yellow flag.

Brees kept his record touchdown streak going, hooking up with Marques Colston on a 1-yard scoring pass and Jimmy Graham from 6 yards out.

The Saints quarterback finished 21 of 27 for 239 yards, a big improvement on his 22-of-42 showing against the Broncos.

Meanwhile, a Saints defense that had endured much ridicule kept the heat on Vick, and the brutal pounding made it tough for No. 7 to establish any rhythm. He finished 22 of 41 for 272 yards and really couldn't be blamed for Robinson's interception, which went off the hands of Celek, the first major miscue on a tough night for the tight end.

Cameron Jordan had three sacks, matching his total for the season, while Will Smith took down Vick twice — also matching his sack total through the first seven games.

Reid moved quickly to snuff out any talk about replacing Vick, which has become a weekly ritual.

"Michael Vick will be the quarterback," the Eagles coach said.

The Saints raced to a 21-3 halftime lead, putting the Eagles in a big hole for the second straight game. Over the last two weeks, they have been outscored 45-10 in the first and second quarters.

New Orleans was on the verge of blowing it open when it took the second-half kickoff and drove deep into Philadelphia territory. But the Eagles defense came up with a big turnover, as Brandon Graham stripped the ball from Brees and fell on it at the Eagles 17. Two plays later, Vick found Jackson wide open down the right side on a deep throw, and he took it the rest of the way for a touchdown.

Rookie Travaris Cadet, filling in on returns for the injured Darren Sproles, fumbled the ensuing kickoff and Philadelphia recovered again. Vick broke off a 14-yard run to the 8, but yet another sack stifled the drive.

The Eagles settled for Alex Henery's second field goal from 37 yards.

It was that kind of night for the Eagles.

NOTES: Graham led the Saints with a season-high eight catches for 72 yards. ... Jackson finished with 100 yards receiving on just three catches. ... Philadelphia's LeSean McCoy had 19 carries for 119 yards, but only 18 yards came after halftime. ... New Orleans gave up a season low in points. The previous best was a 31-24 victory over San Diego. ... The Saints lost two players to injuries. OT Zach Strief (groin) went down in the third quarter, and DE Junior Galette (ankle) was hurt in the first. Neither returned.

___

Follow Paul Newberry on Twitter at www.twitter.com/pnewberry1963

___

Online: http://pro32.ap.org/poll and http://twitter.com/AP_NFL

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Global Update: Polio Eradication Efforts in Pakistan Focus on Pashtuns

Michael Kamber for The New York Times

Polio will never be eradicated in Pakistan until a way is found to persuade poor Pashtuns to embrace the vaccine, according to a study released by the World Health Organization.

A survey of 1,017 parents of young children found that 41 percent had never heard of polio and 11 percent refused to vaccinate their children against it. The survey was done in Karachi, Pakistan’s largest city and the only big city in the world where polio persists; it was published in the agency’s November bulletin.

Parents from poor families “cited lack of permission from family elders,” said Dr. Anita Zaidi, who teaches pediatrics at the Aga Khan University in Karachi. Some rich parents also disdained the vaccine, saying it was “harmful or unnecessary,” she added.

Pashtuns account for 75 percent of Pakistan’s polio cases even though they are only 15 percent of the population. Wealthy children are safer because the virus travels in sewage, and their neighborhoods may have covered sewers and be less flood-prone.

Pashtuns are the largest ethnic group in next-door Afghanistan, where polio has also never been wiped out. Most Taliban fighters are Pashtun, and some Taliban threatened to kill vaccinators earlier this year. Two W.H.O. vaccinators were shot in Karachi in July.

Rumors persist that the vaccine is a plot to sterilize Muslims. But the eradication drive is recruiting Pashtuns as vaccinators and asking prominent religious leaders from various sects to make videos endorsing the vaccine.

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Changing of the Guard: Facing Protests, China’s Business Investment May Be Cooling

SHIFANG, China — Local leaders were all smiles this summer at a groundbreaking ceremony for a vast copper smelting project that seemed like the answer to the chronic unemployment that has plagued this city in northern Sichuan ever since a devastating earthquake in 2008.

Reuters

A protest against plans to expand a petrochemical plant in Ningbo, China, last month. More investment projects are running into opposition from a growing Chinese middle class concerned about environmental damage.

Articles in this series are examining the implications for China and the rest of the world of the coming changes in the leadership of the Chinese Communist Party.

But within days, the tree-lined plaza at the heart of the city was packed with thousands of youths, protesting that the $1.6 billion factory would pose a pollution hazard. After two nights of street battles pitting youths against the riot police, city leaders canceled the smelter.

“The environment is more important” than new investments or jobs, said a young woman sitting on a recent afternoon at the cafe across the street from the plaza, now empty except for a clutch of retirees gathered under the clock tower.

China’s economic boom over the last three decades has depended overwhelmingly on a build-at-all-costs investment strategy in which pollution concerns, the preservation of neighborhoods and other such questions have been swept aside. But that approach is starting to backfire, posing one of the biggest challenges for the new generation of Chinese policy makers who will take over at the Communist Party Congress, which starts on Thursday.

New investment projects used to be seen as the best way to keep the Chinese public happy with jobs and rising incomes, assuring social stability — a paramount goal of the Communist Party — while frequently enriching local politicians as well.

But from Shifang in the west to the port of Ningbo in the east, where a week of sometimes violent protests forced the suspension on Oct. 28 of plans to expand a chemical plant, more projects are running into public hostility.

In many cases, they are running into opposition not just from farmers who do not want their houses and fields confiscated, but also from a growing middle class fearful that new factories will lead to more environmental damage.

In response to this and other worries about the economy, a number of influential officials and business leaders in China have stepped up their calls for changes aimed at increasing the efficiency of investment and simultaneously shifting the country toward a greater reliance on consumption.

But China’s leaders, including the outgoing prime minister, Wen Jiabao, have been talking about such a transformation for years with little sign of success, as state-controlled banks continue to lend huge sums to politically powerful state-owned enterprises and local governments.

Frenzied construction of roads, bridges, tunnels and rail lines over the last decade has left China with world-class infrastructure. But it has also produced deeply indebted local governments that are struggling to finance more projects.

At the same time, vast unused capacity in practically every industrial sector has crippled profitability and left manufacturing companies straining to repay their borrowings, a problem that has been partly masked by banks in the habit of simply rolling over loans rather than recognizing losses.

“All Chinese industries are like that — can you dig out which area of Chinese industry is not in overcapacity?” said Li Junfeng, a longtime director general for energy at China’s top economic planning agency.

Investment reached 46 percent of China’s economic output last year. By comparison, Japan’s investment rate peaked at 36 percent, which it reached in the early 1970s; South Korea topped out at 39 percent in the late 1980s.

Growth in Japan and South Korea started to slow and eventually tumbled after investment peaked. The big question now is when China will run into the same limits, and how rapidly change will take place, said Diana Choyleva, an economist at Lombard Street Research in Hong Kong. “The potential for a big crisis is always there,” she said.

Even experts who strongly favor fundamental policy changes, like moving to a more market-oriented system for allocating bank loans and setting interest rates, doubt that China’s leaders are preparing to move quickly. Conversations at senior levels of the Communist Party appear to have focused so far on reducing the state’s role in the day-to-day management of many state-owned enterprises rather than selling them or breaking them up.

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Apple sells 3 million iPads over first weekend

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Syrian Rebels Claim to Kill Dozens of Soldiers

SANA, via Associated Press

An image released by Syria’s official news agency showed Damascus residents gathering at the scene of a blast on Monday.

BEIRUT, Lebanon — Syria was convulsed by one of the most violent days in months on Monday, with heavy fighting reported around Palestinian neighborhoods in southern Damascus, at least two car-bomb explosions and strikes by government aircraft on numerous rebel targets.

Sharply conflicting accounts emerged from the government and the rebels on the toll from a car bombing near the central city of Hama, with the rebels reporting dozens of soldiers dead and the government saying just two civilians were killed.

The Syrian Observatory for Human Rights, a group based in Britain with a network of contacts inside Syria, said that Jabhet al-Nusra, a jihadist organization, and other rebel groups in the region collaborated in a suicide car bombing of a government checkpoint in a village near Hama, killing at least 50 soldiers.

“They targeted one of the biggest checkpoints in the region. It’s a big building where the regime forces were headquartered,” said Ahmad Raadoun, a member of the Free Syrian Army in the Hama suburbs, who was reached via Skype.

Mr. Raadoun, who said he was about 20 miles from the village of Ziyara, where the attack took place, said the bomb caused extensive casualties and other damage in what he described as a “big operation.”

The official news agency, SANA, said the explosion, outside a government building called the Rural Development Center, was orchestrated by terrorist groups and left 2 civilians dead and 10 wounded. The government has repeatedly labeled opposition groups seeking to topple President Bashar al-Assad as terrorist organizations.

The reasons for such divergent accounts could not be immediately ascertained.

Checkpoints in rural areas often serve as rudimentary bases for the government, with large numbers of men and matériel stationed in them to carry the fight across the province.

Another car bombing was reported in Mazzeh 86, a Damascus neighborhood on the slopes below the presidential palace, home to many members of the security forces. The forces are dominated by members of Mr. Assad’s Alawite minority, which controls the country.

The Free Syrian Army claimed responsibility for that attack, saying in a statement that its fighters had targeted officers as well as members of the armed militias who fight for the government. The statement, posted on Facebook, claimed a large number of casualties but did not give any figures.

The Syrian Observatory said the bomb, which it described as a booby-trapped car that exploded in Bride Square, killed 5 people and wounded more than 30, some of them critically.

Pictures posted on Facebook showed a large column of smoke rising from the area.

Damascus residents reached by telephone said that they were trying to flee the heavy fighting, but that there was so much going on in every direction that they did not quite know where to run.

“There is very, very intense shelling on southern Damascus right now,” said an activist reached by Skype who goes by Abu Qays al-Shami. At least 10 people were killed as government helicopters and tanks blasted the area, he said.

Residents said the fighting had erupted in and around the Yarmouk camp in southern Damascus, the center of Palestinian life in Syria for decades. Many Palestinians have sided with the nearly 20-month-old anti-Assad uprising, but the Popular Front for the Liberation of Palestine-General Command, a splinter Palestinian group long supported by the government, still backs Mr. Assad. The fighting erupted between the organization and government opponents.

Elsewhere in southern Damascus, government helicopters were shelling the restive neighborhood of Hajjar al-Aswad, a target of frequent attacks in recent weeks, according to the Local Coordinating Committees, an anti-Assad activist group that keeps track of casualties. SANA said five people were killed in Yarmouk, including a woman and three children, when a mortar shell hit a public minibus. The agency blamed terrorist organizations.

In its daily roundup of violence around the country, SANA also said that government forces clashed with opposition groups in the eastern city of Deir ez-Zour and in Aleppo, the northern city that has been a battleground since midsummer.

Activist organizations reported a number of airstrikes around the country.

One extremely graphic video posted from the village of Kafrnabel, near Idlib, shows bloodied victims dumped into a truck in the aftermath of what was described as an aerial assault. A shot of the main street shows flames leaping from vehicles and residents running around in panic. At least five men and one woman died, the Syrian Observatory said, but more victims were believed buried under the rubble. Video accounts cannot be independently confirmed.

At the United Nations on Monday, a top relief official said the organization’s aid effort in Syria “is very dangerous and very difficult.” The official, John Ging, director of operations of the Office for the Coordination of Humanitarian Affairs, told reporters at a news conference that the United Nations was supplying 1.5 million people in Syria with food and that nearly half is delivered into areas of conflict, but “there are areas beyond our reach, particularly areas under opposition control for quite a long time.”

Reporting was contributed by Hania Mourtada from Beirut, Hala Droubi from Dubai, United Arab Emirates, and Rick Gladstone from New York.

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Doctor: Colts coach Pagano's leukemia in remission

INDIANAPOLIS (AP) — The doctor of Indianapolis Colts coach Chuck Pagano says his leukemia is in remission.

Dr. Larry Cripe told The Associated Press on Monday that Pagano's white blood cell count was normal and his bone marrow showed no indication of the disease.

Earlier Monday, interim coach Bruce Arians said the Colts (5-3) hoped to have Pagano back on the sideline for their regular-season finale Dec. 30. Pagano spoke to his players before and after Sunday's 23-20 victory over Miami.

Pagano was diagnosed with leukemia Sept. 26 and remained hospitalized until Oct. 21 as doctors treated him with chemotherapy. He has been resting at home since then.

Sunday marked the first time he was allowed to return to Lucas Oil Stadium.

Pagano will go through a second round of chemotherapy soon because some cancerous cells may remain in his body.

___

Online: http://pro32.ap.org/poll and http://twitter.com/AP_NFL

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The Doctor’s World: Doctors Chased Clues to Identify Meningitis Outbreak

The e-mail Dr. Marion A. Kainer received on Sept. 18 suggested an investigation of a case of fungal meningitis and stroke in a man whose immune system was normal and whose only risk for the infection was a spinal injection of a steroid.

“Alarm bells went off” because of its rarity, Dr. Kainer, an epidemiologist at the Tennessee health department, said in an interview.

She immediately began what became a national investigation that has now identified 409 cases, including 30 deaths, from a fungus so unusual that it is not in medical textbooks. The fungus was transmitted through injections of a contaminated steroid drug prepared by the New England Compounding Center in Framingham, Mass.

Dr. Kainer’s investigation led Tennessee to take extraordinary measures to track down 1,009 people at risk of the fungal infection. The state is credited as the driving force in discovering one of the most shocking outbreaks in the annals of American medicine.

The discovery came in large part because of Dr. Kainer’s diligence and expertise in infectious diseases, neurology and public health. It came, too, from the clinical acumen of Dr. April C. Pettit, an infectious disease specialist at Vanderbilt University who sent the e-mail to the health department.

The still-evolving findings also illustrate the strengths of the government’s response to a public health crisis.

Dr. Kainer, like other physicians in hospitals and clinics, often detect the initial cases. But usually only health departments and other government agencies have the ability and authority to track down additional cases to document disease outbreaks and warn those at risk. It is work that private groups seldom can do, in part for lack of funds and the authority to examine patient records.

The national surveillance system for outbreaks of infectious and other communicable diseases relies on reports that physicians are required to send to local and state health departments and that are then relayed to the Centers for Disease Control and Prevention. At the federal agency in Atlanta, epidemiologists identify outbreaks by studying trends.

At the same time, the fungal meningitis cases have exposed weaknesses in government. A dispute surrounds the Food and Drug Administration’s failure to act earlier to prevent the outbreak. The federal agency has been attacked for failing to use its authority to protect the public from the dangerous practice of large-scale drug compounding that led to the outbreak. But the agency, whose top officials have remained relatively silent, says Congress has not given it the clear authority needed to have taken action.

Dr. Kainer’s investigation progressed in steps similar to peeling the layers of an onion.

Within two days of receiving Dr. Pettit’s e-mail, Dr. Kainer learned that the steroid had come from the New England Compounding Center.

“That got me very concerned,” Dr. Kainer said, because she had taken part in epidemiologic investigations involving different infections linked to compounding centers. Inquiries determined that the New England center had received no reports of infections linked to its steroid, and the C.D.C. knew of no additional recent cases of fungal meningitis and stroke.

An inspection by Dr. Kainer’s staff and from the clinic that administered the injection showed no obvious source of local fungal contamination, like recent construction or water leaks.

Then Dr. Kainer learned of three additional suspect cases of meningitis and stroke linked to the clinic. But fungi had not yet been identified in those patients’ spinal fluid. Also, her team could find no correlations in factors like time of day or week when the patients received the injections. One patient had a particular kind of stroke known as posterior circulation, which attracted Dr. Kainer’s attention because she had learned in neurology that fungal infections can cause such strokes.

“What didn’t make sense was that two patients appeared to be improving without antifungal treatment, and that didn’t fit the clinical picture,” Dr. Kainer said.

So she and her team took additional steps. One was to issue a statewide alert to identify similar cases; none were reported.

“We tell doctors and health workers we would rather have 15 false alarms than miss one case,” Dr. Kainer said.

Then she learned that the two patients who had been improving had taken a turn for the worse.

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Silicon Valley Objects to Online Privacy Rule Proposals for Children

Washington is pushing Silicon Valley on children’s privacy, and Silicon Valley is pushing back.

Apple, Facebook, Google, Microsoft and Twitter have all objected to portions of a federal effort to strengthen online privacy protections for children. In addition, media giants like Viacom and Disney, cable operators, marketing associations, technology groups and a trade group representing toy makers are arguing that the Federal Trade Commission’s proposed rule changes seem so onerous that, rather than enhance online protections for children, they threaten to deter companies from offering children’s Web sites and services altogether.

“If adopted, the effect of these new rules would be to slow the deployment of applications that provide tremendous benefits to children, and to slow the economic growth and job creation generated by the app economy,” Catherine A. Novelli, vice president of worldwide government affairs at Apple, wrote in comments to the agency.

But the underlying concern, for both the industry and regulators, is not so much about online products for children themselves. It is about the data collection and data mining mechanisms that facilitate digital marketing on apps and Web sites for children — and a debate over whether these practices could put children at greater risk.

In 1998, Congress passed the Children’s Online Privacy Protection Act in an effort to give parents control over the collection and dissemination of private information about their children online. The regulation, known as Coppa, requires Web site operators to obtain a parent’s consent before collecting personal details, like home addresses or e-mail addresses, from children under 13.

Now, federal regulators are preparing to update that rule, arguing that it has not kept pace with advances like online behavioral advertising, a practice that uses data mining to tailor ads to people’s online behavior. The F.T.C. wants to expand the types of data whose collection requires prior parental permission to include persistent ID systems, like unique device codes or customer code numbers stored in cookies, if those codes are used to track children online for advertising purposes.

The idea is to preclude companies from compiling dossiers on the online activities — and by extension the health, socioeconomic status, race or romantic concerns — of individual children across the Web over time.

“What children post online or search as part of their homework should not haunt them as they apply to colleges or for jobs,” Representative Edward J. Markey, Democrat of Massachusetts and co-chairman of the Bipartisan Congressional Privacy Caucus, said in a recent phone interview. “YouTube should not be turned into YouTracked.”

The agency’s proposals have provoked an intense reaction from some major online operators, television networks, social networks, app platforms and advertising trade groups. Some argue that the F.T.C. has overstepped its mandate in proposing to greatly expand the rule’s scope.

Others say that using ID systems like customer code numbers to track children “anonymously” online is benign — and that collecting information about children’s online activities is necessary to deliver the ads that finance free content and services for children.

“What is the harm we are trying to prevent here?” said Alan L. Friel, chairman of the media and technology practice at the law firm Edwards Wildman Palmer. “We risk losing a lot of the really good educational and entertaining content if we make things too difficult for people to operate the sites or generate revenue from the sites.”

The economic issue at stake is much bigger than just the narrow children’s audience. If the F.T.C. were to include customer code numbers among the information that requires a parent’s consent, industry analysts say, it might someday require companies to get similar consent for a practice that represents the backbone of digital marketing and advertising — using such code numbers to track the online activities of adults.

“Once you’ve said it’s personal information for children that requires consent, you’ve set the framework for a requirement of consent to be applied to another population,” Mr. Friel said. “If it is personal information for someone that’s 12, it doesn’t cease being personal information when they are 13.”

Indeed, many of the F.T.C.’s proposed rule revisions have vocal detractors.

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