Wednesday, February 6, 2008

Attackers zero in on Yahoo Jukebox's ActiveX flaw
Just one day after hackers showed how to exploit a number of flaws in the ActiveX software used by Internet Explorer, Symantec has spotted online criminals using one of the attacks.

The attack, which was first observed in the last few hours, is not widespread at present. Symantec Security Response Director Oliver Friedrichs said Tuesday that the company had identified just three Web sites that were hosting the attack code, all of which seem to be linked to the same criminals. But he believes that more attacks are inevitable as the bad guys work the code into their malicious toolkits of software. "Given the fact that the proof of concept is available and works, it's not exactly rocket science for someone to plug this into [a toolkit]," he said. "That's likely to happen in short order."

Security researchers Elazar Broad and Krystian Kloskowski have disclosed a slew of ActiveX bugs affecting MySpace and Facebook over the past few days, but the attack reported by Symantec takes advantage of a flaw in an ActiveX control used by Yahoo's Music Jukebox.

After the attackers are able to install software on the victim's machine, they then begin installing a number of malicious files on the victim's computer, Symantec said.

Broad and Kloskowski also discovered a second ActiveX bug in Yahoo Jukebox, but that flaw is not yet being exploited by attackers, according to Symantec. Another major source of problems is the Aurigma ImageUploader ActiveX control, which is used by Web sites such as Facebook and MySpace to upload pictures into Internet Explorer.

Because of all the ActiveX bugs, Security experts are warning users to be cautious while Web browsing. On Tuesday, US-CERT (United States Computer Emergency Readiness Team) published a note encouraging users to disable ActiveX controls, which can be done by setting Internet Explorer's security level to "high" for the Internet zone.

That may not be a realistic option for many consumers, who will find their Internet Explorer browsing experience hobbled without ActiveX, Friedrichs said. But tech-savvy users and corporate IT shops can take steps to disable the untrusted ActiveX controls. In fact, the SANS Internet Storm Center has published free software that disables the controls.

Another option for enterprise users is to create a whitelist of approved ActiveX controls, Friedrichs said.

Security problems with browser add-ons are very common. In the first half of 2007, Symantec identified 237 browser plugin security flaws. About 89 percent of centered on ActiveX.

Yahoo did not immediately respond to an e-mail message requesting comment for this story.


Friday, February 1, 2008

Yahoo Board Chairman Quits

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Terry Semel is stepping down as Yahoo's non-executive chairman, six months after handing over his CEO title to Jerry Yang.

Semel is leaving the board effective immediately, Yahoo announced Thursday. He will be replaced as non-executive chairman by another board member, Roy Bostock, the company said.

Semel was chairman and CEO of Yahoo for six years until he was replaced in a management shuffle last June. Yang, one of Yahoo's co-founders, was made CEO, and Semel was demoted to non-executive chairman.

As CEO, Semel helped to build Yahoo's audience from 170 million to more than 500 million users. But he was also blamed for missteps that allowed Google to build a commanding lead in online search and advertising, prompting last year's reorganization.

"With the Company moving forward under new leadership, I believe this is an appropriate time for me to step down from the board," Semel said in the statement.

He approached the board several months ago about leaving once a replacement could be found, Yahoo said.

Bostock has a long history in the advertising industry, "an area that is more important than ever to Yahoo's business and our long term success," the company said.

On Tuesday Yahoo reported that net income for its fourth quarter declined to $206 million, from $269 million a year earlier. It also announced plans to lay off about 1,000 staff.

Semel's departure from the board appears to mark the end of his tenure at Yahoo. Yang thanked him for "his many contributions to Yahoo over the years and for helping to lay a firm foundation for future success and improved financial performance."

Bostock has been a board member at Yahoo since May 2003 and was elected unanimously by the board to replace Semel. From 1990 to 2000 he was chairman and CEO of D'Arcy Masius Benton & Bowles, and its successor advertising company The MacManus Group.


Microsoft Makes $44.6 Billion Offer for Yahoo

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Microsoft has offered to buy Yahoo for US$44.6 billion.

The offer is 62 percent above Yahoo's closing share price on Thursday.

"We have great respect for Yahoo!, and together we can offer an increasingly exciting set of solutions for consumers, publishers and advertisers while becoming better positioned to compete in the online services market," said Steve Ballmer, chief executive officer of Microsoft.

"Our lives, our businesses, and even our society have been progressively transformed by the Web, and Yahoo! has played a pioneering role by building compelling, high-scale services and infrastructure," said Ray Ozzie, chief software architect at Microsoft.

The bid comes hours after Yahoo announced that Terry Semel was stepping down as non-executive chairman, six months after handing over his CEO title to Jerry Yang.

Semel is leaving the board effective immediately, Yahoo announced yesterday. He will be replaced as non-executive chairman by another board member, Roy Bostock, the company said.

Semel was chairman and CEO of Yahoo for six years until he was replaced in a management shuffle last June. Yang, one of Yahoo's co-founders, was made CEO, and Semel was demoted to non-executive chairman.

As CEO, Semel helped to build Yahoo's audience from 170 million to more than 500 million users. But he was also blamed for missteps that allowed Google to build a commanding lead in online search and advertising, prompting last year's reorganisation.

"With the Company moving forward under new leadership, I believe this is an appropriate time for me to step down from the board," Semel said in the statement.

He approached the board several months ago about leaving once a replacement could be found, Yahoo said.

Bostock has a long history in the advertising industry, "an area that is more important than ever to Yahoo's business and our long term success," the company said.

This week Yahoo reported that net income for its fourth quarter declined to $206 million, from $269 million a year earlier. It also announced plans to lay off about 1,000 staff.


Wednesday, January 16, 2008

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Apple Patches iPhone, iPod, QuickTime Security Flaws

Apple has released its first security updates of the new year, fixing bugs in its QuickTime media player and iPhone and iPod touch devices.

As with previous updates, the iPhone 1.1.3 software patch sent those who had installed the unauthorized Jailbreak software -- used to run third-party applications on the iPhone -- scrambling to get their phones up and running. That's because Apple's updates have so far always rendered Jailbreak unusable, forcing users to go through a complex re-installation process.

According to the Unofficial Apple Weblog, it is possible to run third-party software following this latest update, but the process is complex. A simpler Jailbreak 1.1.3 script is expected to be posted eventually at the iPhone Wiki, which is the hub of much iPhone hacking.

The iPhone update fixes two flaws in the Safari browser, including a critical bug that could be exploited to run unauthorized software on the device. A third bug could let an unauthorized user bypass Passcode Lock and launch iPhone applications. The iPod touch is susceptible to the Safari bugs, Apple said.

These updates will be rolled out to customers over the next week via the devices' iTunes update mechanism.

The QuickTime 7.4 update fixes four critical flaws in the software that could be exploited by attackers to crash the media player or even run unauthorized software on a victim's computer. The update is available for both the Windows and Mac OS X operating systems.

However, the software does not fix a serious flaw in the player that was disclosed over the weekend.

Security experts are particularly concerned over this flaw because attack code showing how it can be exploited has also been published. Apple is still working to fix the vulnerability, which has to do with QuickTime's use of the Real-Time Streaming Protocol (RTSP).


Microsoft Warns of New Excel Vulnerability

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Attackers are exploiting a vulnerability that lies within several versions of the Excel spreadsheet program, Microsoft warned late Tuesday.

The problem in Excel allows a hacker to create a malicious Excel document that when opened can compromise a computer, Microsoft said in an advisory. The vulnerability could allow remote code to be executed on a computer, which means a user risks having their personal data exposed.

Microsoft downplayed the risk, saying only targeted attacks have been seen. But since Microsoft Excel documents are commonly used for business, vulnerabilities such as this pose a greater risk.

"Users are familiar with the document being sent to them and are likely to open it," wrote security analyst Maarten Van Horenbeeck, in a commentary on the Web site for the SANS Internet Storm Center, which monitors Internet threats.

The vulnerability is within the Microsoft Office Excel 2003 Service Pack 2, Microsoft Office Excel Viewer 2003, Microsoft Office Excel 2002, Microsoft Office Excel 2000 and the Mac version, Microsoft Excel 2004.

Those who have installed Office Service Pack 3, which includes updates for Excel as well as other products in the office productivity suite, are not affected, Microsoft said. That service pack was released last September.

Also not affected are Microsoft Office Excel 2007, Microsoft Office Excel 2007 Service Pack 1 and Microsoft Excel 2008 for the Mac.

A PC user could be attacked a couple different ways. An e-mail with a malicious Excel attachment could be sent, upon which a user would have to download and open it to be exposed, Microsoft said. A hacker could also create a Web site hosting the file and try to persuade people to download it.

Microsoft did not indicate when it would issue a patch for the problem. People who think they may have been attacked can contact Microsoft and their national law enforcement agency.


Sun to buy MySQL for $1 billion

Sun Microsystems Inc. plans to buy open-source software maker MySQL AB for $1 billion, beefing up the server maker's database offerings with a company whose technology is used by some of the world's biggest Web sites.

Sun, in a separate announcement before the market opened, said its second quarter revenue would narrowly exceed Wall Street estimates. It also said profit would fall at the high end of analysts' expectations. The company revealed its preliminary results ahead of schedule.

Santa Clara-based Sun is paying $800 million in cash and assuming $200 million in options to acquire MySQL. The Swedish company makes open-source database software used by companies such as online search leader Google Inc., popular Internet hangout Facebook Inc. and Finnish phone maker Nokia Corp.

Sun said the deal will help spread MySQL's software to large corporations, which have been the biggest customers of Sun's servers and software, and boost its distribution through Sun's relationships with other server makers such as IBM Corp. and Dell Inc.

Sun has tied its fortunes to open-source software. It believes it can sell more server computers and ring up higher maintenance fees by also offering software whose source code is publicly available for free.

MySQL competes with non-open-source offerings from Microsoft Corp. and Oracle Corp., which dominate database software for traditional businesses.

However, MySQL is the rapidly growing market leader in open-source database software, particularly among Web-based companies, where it commands about 80 percent of the global market, according to Sun Chief Executive Jonathan Schwartz.

Microsoft is less than 10 percent of that market, Schwartz said.

"We are really acquiring a database that customers and Web companies across the world have moved to at a breathtaking clip," Schwartz said in an interview. "The titans of the Web all use MySQL - banks, automobile companies, pretty much all of the Fortune 500 runs MySQL in their shops."

The acquisition, expected to close in the third or fourth quarter, takes pressure off Sun to spend some of the cash it's been accumulating. It also bolsters its software offerings with a well-known known name in Internet data retrieval.

"This gives us access to every hot Web company on earth, and every company that will be hot 5 years from now," Schwartz said. "For us, this is completely landscape-changing."

Sun also said it expects net income of between $230 million to $265 million, or 28 cents to 32 cents per share. Analysts surveyed by Thomson Financial were expecting profit of between 22 cents and 38 cents.

Sun predicts $3.6 billion in sales during the second quarter. Analysts were expecting, on average, $3.58 billion in sales.

The company was expected to release its results January 24.

Despite financial difficulties that have plagued Sun since the dot-com meltdown in 2001, the company has been accumulating a cash horde that reached $5.9 billion at the end of the 2007 fiscal year.

In recent quarters, as Sun has returned to profitability under new management and tightened cost controls, investors have pressured the company to spend some of its war chest in ways that boost its value.

Still, some shareholders remain skeptical about the company's prospects.

Sun's stock price has slid about 25 percent since the company's 1-for-4 reverse stock split in November, an essentially cosmetic maneuver to remove the stigma of slumping shares.

In a reverse stock split, a company lowers the number of outstanding shares, boosting the value of each share, while keeping total market value unchanged.

As a result, Sun's share price jumped from around $5 to more than $20, but has fallen sharply since then, closing Tuesday at $14.98 before the acquisition and results were announced.

Sun shares rose 76 cents, or more than 5 percent, to $15.74 early Wednesday.


Tuesday, January 15, 2008

Apple unveils super-thin "Air" laptop, Web movies

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Apple on Tuesday launched an aluminum-clad laptop just three-quarters of an inch thick, seeking to bring a new computer to market with the same cachet as its iPod and iPhone devices.

Apple also said it would let people rent films over the Web with upgrades to its iTunes online media store, a technological challenge to a movie industry still largely focused on DVDs.

Shares of movie rental firms Netflix and Blockbuster fell sharply in response, and Apple's own stock lost 5.5 percent since the announcements were widely expected and Chief Executive Steve Jobs failed to conjure up any big surprises.

Jobs set a high bar last year by unveiling the iPhone. In addition, many times he ends presentations with by saying, "One more thing..." as a prelude to something unexpected. This year there was none.

Still, Jobs' talents as a showman were on display when he took the stage at the annual Macworld convention in San Francisco to cheers and applause from a few thousand software developers, customers and Apple employees.

He detailed a series of new products and services but saved the laptop, dubbed the MacBook Air, for last, drawing it out of a standard manila envelope to emphasize its slim dimensions.

Jobs said the new notebook was the thinnest available, measuring 0.76 inches at its thickest point and tapering to just 0.16 inches.

Priced from $1,800, the Air bridges the gap between Apple's entry-level and high-end laptops, but analysts voiced concern that it could steal customers away from pricier products.

"It's not really clear how many more incremental buyers you can drive, and there could be some cannibalization," said Shaw Wu, an analyst with American Technology Research.

MacBook laptops have been one of the company's strongest products, with sales rising 37 percent on the year in the fiscal fourth quarter ended last September.


Phil Schiller, Apple's vice president of marketing, said the new laptop could appeal to a large swath of customers, including business travelers, those in education and people who wanted a more attractive computer at home.

"The goal overall is to continue to grow the business, so having another product in the line helps to do that. If the mix (of customers) changes a little bit, it doesn't matter as long as we grow everything," Schiller said.

Apple stock has nearly doubled since last year's Macworld, and in late December topped $200 for the first time, driven by market-share gains by Mac computers, continued iPod strength, and enthusiasm over the iPhone, which Jobs said had sold more than 4 million units since its release last June.

Jobs showed off new iPhone features such as displaying a user's location on a map and a way to customize the main screen with icons linking directly to specific parts of a Web site.

"The iPhone is not standing still. We keep making it better and better and better," Jobs said.

But the company has struggled to find a big audience for Apple TV, a product originally designed as a Mac accessory for watching Internet video on a television and unveiled alongside the iPhone a year ago.

"It's not what people wanted. We learned what people wanted was ... movies, movies, movies," Jobs said.

A new version of Apple TV will be able to connect to the Internet directly and download TV shows, movies and music through iTunes. Viewers will be able to choose movies directly from their TVs and Apple said viewers could start watching within seconds if they had a fast Internet connection.

Jobs announced deals with all six major movie studios and several smaller ones to offer movies for rental through iTunes, with new releases costing $3.99 and library titles $2.99. High-definition movies will also be available.

The revamp of Apple TV hardware combined with a broad selection of movies would give Apple an edge over competitors such as Inc, Netflix and Microsoft Corp, American Technology Research's Wu said.

News Corp's 20th Century Fox, Walt Disney Co, Time Warner Inc's Warner Bros, Viacom Inc's Paramount, General Electric Co's Universal, Sony Corp's Sony Pictures, Lionsgate, MGM and New Line have all signed on to Web rentals, Apple said.

"It's too early to declare that this is going to be a big hit but this is arguably the best offering out there right now," Wu said.

Apple shares fell to $169.04, while mail rental firm Netflix Inc shed 3.2 percent, and top video rental chain Blockbuster Inc dropped nearly 17 percent.


IBM to Add Software for Apple Devices

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E-mail software from IBM Corp. will be available on Apple Inc. iPhones and iPod Touch devices under a new partnership that brings together two big rivals of Microsoft Corp.

IBM plans a formal announcement of the Lotus Notes e-mail package for Apple's portable devices at its Lotusphere conference in Orlando, Fla., next week. The software, which requires use of IBM's Domino e-mail server program, will be free for users who already have a Lotus Web-access license and start at $39 per year for new users.

IBM also plans to release Lotus Notes and the free Lotus Symphony "productivity" package - which includes documents, spreadsheets and other Microsoft Office-like software - for Apple's Macintosh computers.

With these moves, IBM is trying to find more avenues for its software and take advantage of Apple's natural affinity for Microsoft alternatives.

The iPhone already can connect users to Web-based e-mail services and to corporate e-mail sent over Microsoft's Exchange e-mail platform, though businesses rarely enable the setting that makes it possible.

If IBM, which counts 135 million Lotus users worldwide, can get companies to let their employees check Lotus e-mail on iPhones, the partnership could make Apple's gadget more competitive with Research in Motion Ltd.'s BlackBerry and other business-targeted smart phones.

IBM and Apple, competitors in the early years of the PC market, traditionally have not worked closely together in software, though Apple used IBM chips in some Macs for several years until ditching them in favor of Intel Corp. processors in 2005. But now the sides appreciate that "we have a lot in common," IBM spokesman Mike Azzi said. "We're going to cross-pollinate."

One reason for the distance between the two companies is the small overlap between Mac users and the big corporate customers that commonly buy products from IBM.

Now, Apple hardware has become a broader platform with the popularity of the iPhone and Web-enabled iPod Touch devices. However, Apple has delayed fully opening the devices to third-party applications; a "software developers' kit" to enable that isn't due until next month. Apple and IBM have been working together on their own.


Monday, January 14, 2008

Toshiba cuts HD player prices in Blu-ray fight
Consumer electronics maker Toshiba Corp (6502.T: Quote, Profile, Research) said on Monday it is slashing prices of its HD DVD format players by between 40 to 50 percent as major Hollywood studios move to embrace Sony Corp's (6758.T: Quote, Profile, Research) Blu-ray format high definition DVDs.

Toshiba America Consumer Products said it cut prices of its HD DVD players effective January 13 to boost market adoption of its next-generation DVD players by mainstream consumers after what it said was a successful fourth quarter in unit sales.

"While price is one of the consideration elements for the early adopter, it is a deal-breaker for the mainstream consumer," said Toshiba executive Yoshi Uchiyama in a statement.

Toshiba's players will now start as low as $149 going up to $399 for the top-of-range player.

The company said it is also stepping up its marketing drive with major initiatives including joint advertising campaigns with studios and extended pricing strategies. Toshiba said it will continue with on-going promotions including five HD DVD titles for free with any of its HD DVD player.

The battle to dominate the next generation of DVD players appeared to have tipped in Sony's favor earlier this month when the biggest Hollywood studio Warner Bros, a unit of Time Warner Inc (TWX.N: Quote, Profile, Research), said it would exclusively support Blu-ray disc. It had previously supported both next-generation formats.

Analysts saw Warner Bros's move as an end to the next generation DVD war that they say has confused consumers and delayed the development of a multibillion-dollar market.

So far Toshiba has secured agreements with studios including Universal Home Video, Viacom Inc's (VIAb.N: Quote, Profile, Research) Paramount Pictures and DreamWorks Animation SKG.

But Blu-ray has support from News Corp's (NWSa.N: Quote, Profile, Research) 20th Century Fox, Walt Disney Co (DIS.N: Quote, Profile, Research) and Lions Gate Entertainment Corp (LGF.N: Quote, Profile, Research). In addition Sony's PlayStation 3 video game system can play Blu-ray movies while Microsoft Corp's (MSFT.O: Quote, Profile, Research) Xbox 360 works with HD DVD. But Microsoft said at the Consumer Electronics Show earlier this month that it could consider supporting Blu-ray technology should consumers want it.


Amazon And Pepsi To Offer Free Music

The image “” cannot be displayed, because it contains errors. and Pepsi have teamed up for a new free music cross promotion that will see Pepsi drinkers earn free music with Pepsi purchases.

“Pepsi Stuff” is billed as a “massive collect-and-get program” where “consumers can download the most DRM-free MP3 music available anywhere.” In layman’s terms, drink lots of Pepsi, get DRM free music for free on Amazon.

Starting February 1, Pepsi users must “bank” their points on to redeem them for music on Amazon MP3.

Cross promotions of this kind aren’t new, but it does show the seriousness of Amazon to promote its DRM free music store to a wider audience (Pepsi has previously given away iTunes downloads). It was only 12 months ago that we wrote about the inevitable death of DRM, yet one year later in 2008 the market is now focused on which DRM free music provider comes out on top, and we wouldn’t have it any other way. Hopefully the increasingly cut-throat competition will result in downwards pricing pressure as well in the coming months.


MySpace and 45 States Team Up to Fight Online Predators has agreed with more than 45 states to add extensive measures to combat sexual predators.

An official familiar with the multistate agreement said MySpace, the huge online social networking Web site, has agreed to include several online protections and participate in a working group to develop age-verification and other technologies.

The official said MySpace will also accept independent monitoring and changes to the structure of its site.

The agreement is scheduled to be announced today in Manhattan by attorneys general from New Jersey, North Carolina, Connecticut, Pennsylvania, Ohio and New York.

The official spoke on condition of anonymity because the agreement hadn't yet been announced.

The attorneys general have been seeking greater controls for online networking sites to prevent sexual predators from using those sites to contact children.

There was no immediate comment from MySpace, a unit of News Corp.

Investigators have increasingly examined MySpace, and similar social networking sites that allow people to post information and images on the Web and invite contacts from others.

Last year, New York investigators said they set up Facebook profiles as 12- to 14-year olds and were quickly contacted by other users looking for sex.

A multistate investigation of the sites -- announced last year -- was aimed at putting together measures to protect minors and remove pornographic material, but lawsuits were possible, officials said.

''We have to find the best way to make sure parents have the tools ... to protect their children when they're on social networking sites,'' North Carolina Attorney General Roy Cooper said in September.


Microsoft Switches Plan, Offers Vista SP1 Public Beta

In a quick turnabout, Microsoft Corp. made the newest tweak to Windows Vista Service Pack 1 (SP1) available to the public on Friday.

Just two days earlier, the new version, dubbed Windows Vista SP1 RC Refresh, had been handed out to a group of about 15,000 testers who had been working with the service pack for several months. At the time, Microsoft said the refresh was "not available for public download."

Friday, it changed its mind and posted instructions on its Web site for downloading and installing the new code using the Windows Update service.

According to the Windows Vista Service Pack 1 RC Refresh Public Availability Program, users must uninstall Vista SP1 Release Candidate -- the earlier version offered to the general public a month ago -- before attempting to download and install the refresh.

The refresh requires the same time-consuming, multiple-reboot process used by Vista SP1 RC in December. Also, users who have uninstalled that version must wait an hour before beginning the laborious update. "The installer service needs to clean up and complete the uninstall prior to installing the RC," said instructions posted on the Web. "Failing to do this can result in installation errors when installing the RC version."

Three prerequisite updates are also required before SP1 can be installed. Windows Update feeds them to the PC prior to downloading SP1, with a reboot after each. One of the prerequisites is a patch Microsoft mistakenly sent to all Vista users' PCs last week when it meant to send it only to machines running Vista Enterprise or Vista Ultimate.

The company, which has slated Vista SP1 for final delivery this quarter, said as recently as Thursday that the update remains on track.

Microsoft Tells Details of Office 2008 for Mac

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Microsoft has announced pricing and availability of its latest Mac-compatible version of its Office suite of business tools.

Microsoft Office 2008 for Mac is available from January 15 for £350 (US$685), including VAT, for the Standard Edition. A Home and Student Edition of Office 2008 for Mac costs $193.

Microsoft clams that Office 2008 for Mac is "more powerful and easier to use," including a simplified new user interface and new tools such as Document Elements.

Office 2008 for Mac uses the same Open XML file formats, Office Art graphics engine, and other features as the Windows-based Office 2007. There are also "hundreds" of new customizable templates and suite-wide themes.

Word 2008 features a Publishing Layout View workspace that lets users create "incredibly rich documents" such as newsletters and brochures "without a degree in design."

Excel 2008 has "vastly improved" charting capabilities to help users create and manipulate charts and graphs "easier than ever before."

PowerPoint 2008 includes SmartArt graphics that "let you bring a blank slide to life with stunning charts, maps, and diagrams at the click of a button."

Email client Entourage 2008 is "the hub of Office 2008," and features My Day to keep the user connected with schedules, tasks, and priorities in a clear, stand-alone interface. Project Center helps users keep their project details under control.

Office 2008 for Mac requires Mac OS X v10.4.9 or later, a PowerPC G4 or G5 or Intel Core duo processor, 512MB of RAM and 1.5GB free hard-disk space.


eBay Auction App Updated

German developer iwascoding has introduced a new version of its eBay auction management software, GarageSale 4.0.

GarageSale can be used to build eBay auctions on a Mac, offering a WYSIWYG auction editor and iPhoto, digital camera, or iSight image imports. GarageSale supports advanced eBay features such as item attributes, and automatically uploads auction images to a web server via FTP, .Mac, or WebDAV. More than 120 free listing designs are included with GarageSale. Users can upload up to 10 images per auction free of charge to the GarageSale Image Service.

The company describes the new version as an extensive update which provides an improved user interface that unifies auction and template modes into a single view. Users can edit their auctions completely within GarageSale's web preview.

GarageSale 4.0 now uploads multiple auctions and item images simultaneously, resulting in faster auction uploads. The software costs $29.99.


PlayStation 3 Production Costs Halved, Says Analyst

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From $800 down to a bargain $400, the PlayStation 3 has its production costs in hand, claims wholesale investment bank Nikko Citigroup's Kota Ezawa. While the rest of the Business Week article retains the skepticism prevalent in just about any dissection of PS3 economics, it's the following that may be of interest to anyone who views the system's shortcomings in shades of sticker shock.

Nikko Citigroup's Kota Ezawa estimates the games division will lose $1.4 billion this fiscal year, following last year's $2.1 billion loss. And while he doesn't expect the business to be prosperous until late 2009, Ezawa applauds Sony's efforts to shrink the PS3's chips and tweak its design. Already such changes have cut the cost per machine to around $400 now, from above $800 just before it went on sale in November, 2006, he says. (The PS3 with an 80-gigabyte hard-disk drive retails in the U.S. for about $499.) "We think the biggest factor here is that simplification has become possible through a reduction in the parts count, leading to a reduction in costs," Ezawa wrote in a Dec. 27 report.


Microsoft Trains 200,000 Teachers in India

Microsoft has trained 200,000 teachers in India on the use of computers, ahead of its original target to train 80,000 teachers in the country during the five-year period ending December this year, it said.

The company introduced the program, called project Shiksha, in 2003 with the objective of raising the computer literacy of Indian teachers and students in government-run schools. The 200,000 teachers trained so far have in turn trained about 10 million students, a spokeswoman for Microsoft India said on Monday.

The moves by Microsoft to offer free or subsidized software in India have however come in for criticism from the Free Software Foundation, which compared Microsoft's philanthropy to that of a cigarette manufacturer handing out free samples of cigarettes to students.

The communist-run state of Kerala in south India is actively promoting open-source software in schools, but most other states and the federal government are beneficiaries of Microsoft's programs.

Microsoft works with state governments to help teachers use its technology in school administrations and also to include it in their curriculum and teaching methods, she said. While the state governments provide the classrooms, Microsoft provides the hardware and software, and a team of trainers for the teachers.

Although the company has reached its training target, it's not stopping the program yet. It did not say how many more teachers and students it plans to cover under the program, though.

The company has introduced low-cost, starter editions of its Vista operating system, as well as local language versions of its Office suite to target both the academic and e-governance markets.


Microsoft faces two new European antitrust cases

The European Commission has opened two new antitrust investigations of Microsoft's activities.

The first case is in response to a complaint from the European Committee for Interoperable Systems, a Brussels-based trade group of which Opera Software is a member, and concerns the interoperability of Windows with other software, the Commission said Monday.

The second investigation is looking into Microsoft's tactic of bundling software products with its Windows operating system. This follows a complaint to the Commission by Opera, a Norwegian browser developer.

Both issues featured in the Commission's landmark March 2004 antitrust decision against Microsoft, which the company unsuccessfully challenged in court.


Netflix Expands Internet Viewing Option
Girding for a potential threat from Apple Inc., online DVD rental service Netflix Inc. is lifting its limits on how long most subscribers can watch movies and television shows over high-speed Internet connections.

The Associated Press has learned the change will become effective Monday, on the eve of Apple's widely anticipated move into the movie rental industry. Although Apple hasn't confirmed anything yet, Chief Executive Steve Jobs is expected to make it official during a presentation Tuesday in San Francisco.

Netflix is gearing up for the increased competition by expanding a year-old feature that streams movies over the Internet instead of making customers wait for their online rental requests to be delivered through the mail.

Until now, Netflix restricted how long its more than 7 million subscribers could use the streaming service each month, based on how much they pay to rent DVDs.

For instance, under a popular plan that charges $16.99 per month to rent up to three DVDs at a time, Netflix customers could watch as many as 17 hours of entertainment each month on the streaming service, dubbed "Watch Instantly."

With Monday's change, virtually all Netflix subscribers will be able to stream as many movies and TV shows as they want from a library containing more than 6,000 titles. There will be no additional charge for the unlimited access.

Only the small portion of Netflix customers who pay $4.99 to rent up to two DVDs per month won't be provided unlimited access to the streaming service.

The unlimited streaming option figures to become more enticing later this year when LG Electronics Inc. will begin selling a set-top box that will deliver the content to TVs.

Removing the time constraints on its streamed entertainment could give Netflix an advantage over Apple's movie rental service. Apple will charge $3.99 for movies that can be downloaded and played for up to 24 hours, according to media reports citing people familiar with the company's rental plans.

Letting subscribers stream as much as they want could erode Netflix's profits because the Los Gatos-based company isn't raising its monthly rates even though its expenses may rise if increased usage drives up the licensing fees owed to studios.

Providing unlimited streaming access "fits within the parameters of our overall financial goals," Netflix spokesman Steve Swasey said. The impact of the change will likely be addressed when Netflix discusses its fourth-quarter earnings in a call scheduled for Jan. 23. The company had earned $51 million on revenue of $903 million through the first nine months of 2007.

With more than 90,000 titles available in its DVD library, delivering movies through the mail is expected to remain Netflix's primary moneymaker for years to come.

Nevertheless, Netflix has spent about $40 million on the development of its streaming service during the past year.

The service still doesn't appeal to many Netflix subscribers because it requires watching the entertainment on a personal computer with a high-speed Internet connection.

Subscribers must also use a computer running the Windows operating system to watch streaming Netflix content, which leaves out most Mac users.

Netflix hasn't specified how much content has been streamed since last summer, when management disclosed that more than 10 million movies and TV episodes had been watched through the service. The company says its streaming service has gained the most traction among younger subscribers more accustomed to watching movies on laptops.

Apple's rental service is expected to offer its customers more flexibility, allowing movies to be viewed on the Cupertino-based company's ubiquitous iPod and iPhone, as well as on computers.

Still, most people seem to prefer watching movies on their big-screen TVs - an issue both Apple and Netflix are trying to address.

Apple last year began selling a $299 device designed to transport video from computers to TVs. LG Electronics hasn't disclosed the price of its Netflix box, which is expected to debut in late summer or early fall.


IBM Posts Strong 4Q Preliminary Results
Computer server and software maker IBM said Monday its fourth-quarter earnings from continuing operations rose 24 percent from a year ago, beating Wall Street expectations by a wide margin.

The preliminary report, released in advance of its planned earnings report set for Thursday, sent its shares up 8 percent on premarket trading.

IBM said the weaker dollar helped to push revenue up 10 percent.

The company reported quarterly profit from continuing operations of $2.80 per share on revenue of $28.9 billion, easily beating Wall Street's consensus estimates of $2.60 per share on sales of $27.82 billion, according to a Thomson Financial poll.

International Business Machines Corp. said revenue grew 10 percent from the year-ago period, with 6 points of that growth related to the weaker dollar.

"The broad scope of IBM's global business - led by strong operational performance in Asia, Europe and emerging countries - drove these outstanding results," said Samuel J. Palmisano, IBM chairman, president and chief executive.

For fiscal 2007, IBM reported earnings rose 18 percent to $7.18 per share, including a 5-cent gain on the sale of its printing systems division in the second quarter, on sales of $98.8 billion, representing 8 percent growth year-over-year.

Analysts had predicted full-year profit of $6.97 per share on revenue of $97.73 billion.

Its shares rose $7.85 to $105.52 in premarket trading.

IBM's cash balance at the end of 2007 was more than $16 billion.

The company will report full quarterly and full-year results for 2007 on Thursday.


China Mobile, Apple End Talks on IPhone

Talks between China Mobile Ltd. and Apple Inc. over the launch of iPhone handsets in China have been called off, officials at the Chinese company said Monday.

"We can only say that negotiations have ended for now. We have no other news to report," said Li Honghui, a spokeswoman for China Mobile Communications Corp., the parent of cell phone carrier China Mobile. She declined to comment further.

Rainie Lei, a spokeswoman for China Mobile, earlier Monday also declined to say why the talks ended.

"We have held talks with Apple to launch the iPhone device in China. However, those talks have ended," she said.

Calls to Cupertino, California-based Apple were not answered Monday.

Citing an unnamed official at China Mobile's data services department, Chinese Internet portal reported Monday that China Mobile and Apple could not agree on revenue-sharing terms in their preliminary discussions, according to Dow Jones Newswires.

The official said China Mobile was unwilling to accept Apple's request for a 20 percent to 30 percent share of China Mobile's user fees from future iPhone users, according to the report.

Market watchers and analysts have said a breakdown in talks between Apple and China Mobile could open the way for rival China Unicom Ltd. to offer the iPhone exclusively in mainland China.

China Unicom spokeswoman Sophia Tso declined to comment.

Eric Wen, an analyst at BNP Paribas, said the lack of an agreement would have little impact on China Mobile. But he said the failed negotiations could be a significant positive for China Unicom, which could start talks on an exclusive deal to supply the iPhone.

Wen said he believes China Unicom may be more willing than China Mobile to give Apple a larger percentage of user fees given its smaller share of China's mobile phone market.

Apple launched the iPhone in the U.S. in 2007 and has said it plans to launch the device in Asia this year. It hasn't disclosed any details on which operators in the region it might work with.

Analysts have said they expect Apple to launch the iPhone with one exclusive partner in each country in Asia, as it has done in the U.S. and in Britain.

Shares in China Mobile fell 2.8 percent Monday in Hong Kong to close at HK$130.2.


Friday, January 11, 2008

Amazon Convinces Sony To Go DRM-Free

The image “” cannot be displayed, because it contains errors. on Thursday announced a new deal with Sony BMG to sell its digital music without copy protection. Sony is the last of the major record labels to jump on the Digital Rights Management-free bandwagon.

Amazon's DRM-free MP3 digital music store will now feature music from all four major labels -- Sony, Universal Music Group, Warner Music Group and EMI -- as well as more than 33,000 independent labels. The MP3 songs are playable on virtually any digital music-capable device, including PCs, Macs, iPods, Zunes, Zens, iPhones, RAZRs and BlackBerrys. Sony's music will debut on later this month.

"We are excited to be working with Amazon as they continue to build new markets for digital music," Thomas Hesse, president of Sony BMG Music Entertainment's Global Digital Business & U.S. Sales, said in a statement. "We are constantly exploring new ways of making our music available to consumers in the physical space, over the Internet and through mobile phones, and this initiative is the newest element of our ongoing campaign to bring our music to fans wherever they happen to be."

Moving In on iTunes

Launched in September 2007, Amazon MP3 offers the largest selection of a la carte DRM-free MP3 music downloads, which now includes over 3.1 million songs from more than 270,000 artists. Every song and album in the Amazon MP3 music download store is encoded at 256 Kbps to deliver high audio quality.'s pricing scheme is slightly lower than iTunes in many cases. iTunes offers a standard 99-cent price tag on its singles. Most songs available on Amazon MP3 are priced from 89 cents to 99 cents, with more than 1 million of the over 3.1 million songs priced at 89 cents. Most of the top 100 best-selling songs are 89 cents; most albums are priced from $5.99 to $9.99; and most of the top 100 best-selling albums are $8.99 or less.

Amazon makes digital music downloads available through its 1-Click shopping feature and offers an Amazon MP3 Downloader that streamlines downloads to PCs or digital devices.

Path to Redemption?

With a rapidly changing record industry, Sony seemingly had little choice about its move to DRM-free digital music downloads. According to music industry news site, total album sales last year dropped nearly 15 percent. Rap album sales suffered dramatically with a 30 percent sales drop.

Earlier this week, Sony debuted MusicPass, a $12.99 gift card sold at retail stores that entitles the buyer to download a DRM-free album of MP3s online. MusicPass and the deal are both moves to help Sony compete with other labels and services that have already begun selling DRM-free MP3s on Amazon and elsewhere.

"Sony had issues with trying to balance the protection of its intellectual property with being consumer friendly. Sony is realizing that it's just not working," said Tim Deal, an analyst at Pike & Fischer. "Sony still needs to come a long way to be more pro-consumer and less guarded about its content."

Sony should have been on the forefront of the digital music revolution, Deal noted, but has failed on a number of levels, including poor marketing, mismanaged product introductions and coming late to the table with digital downloads. "Sony's concern for Digital Rights Management was so all-consuming that it put a bad taste in consumers' mouths," Deal said. "Perhaps offering DRM-free music is part of their path to redemption."


SlingPlayer for iPhone and iPod Touch claims (via 9to5) they have an "extremely senior source" at Sling Media who says that an iPhone/iPod Touch version of their SlingPlayer client software is coming.

Sling Media sells the SlingBox which allows you to stream video from your home television over the internet to any supported device (Mac, PC, Mobile Phone). A native SlingPlayer port would bring that functionality to the iPhone. Sling Media, however, is said to be worried that EDGE might not be fast enough to support their streaming media.

This rumor might have been dismissed, if not for the fact that MacRumors has also heard that SlingMedia is indeed one of the lucky developers to get an early copy of the iPhone Software Development Kit (SDK). Apple has reportedly seeded select developers with early versions of the iPhone SDK to ready some applications for the initial launch. The iPhone SDK is officially expected to be released in February 2008.

With Macworld Expo around the corner, we have heard that Apple will show new iPhone software at Macworld, though this could just mean the 1.1.3 firmware that was previously leaked.


QuickTime Real Time Streaming Protocol Vulnerability

US-CERT is aware of a public report of a vulnerability in Apple QuickTime. The flaw is in the way that QuickTime handles Real Time Streaming Protocol (RTSP) Response message headers. By persuading a user to access a specially crafted QuickTime file, or RTSP stream, a remote attacker may be able to execute arbitrary code or cause a denial of service on a vulnerable system.

Opera: Next Version to Crush Internet Explorer

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Opera chief executive Jon S. von Tetzchner flew in from Norway for an update on the company's Web browser, including the claim that the next version could be about ten times faster than Internet Explorer.

According to von Tetzchner, Opera's is expanding into the mobile market. And, not surprisingly, the upcoming Opera 9.5 revision will be faster and more efficient, he said.

With AOL pulling the plug on Netscape Navigator come February, Opera is now the oldest Web browser still standing. It has less than 2 percent market share in the U.S. but has made strides recently, especially in the mobile arena with the rise of Web-ready smartphones and other handheld devices. According to von Tetzchner, the company's mobile Web browsing platform, Opera Mini, has 30 million users worldwide with around 100,000 new downloads a day.

Opera started working on a mobile browser in 1998, but only recently has there been hardware, such as the Apple iPhone, that has been truly able to take advantage of the software. As a result, it has gained in popularity.

"The iPhone was a great boost for us," von Tetzchner said, adding that what the iPhone does is only a subset of the functionality offered by Opera. Opera is available on 59 phones, as well as on many other devices, such as the Nintendo DS Lite.

On the desktop side, the company has been working on the next update of its Web browser, which will be Opera 9.5. The goal is to make app faster and more efficient. For example, 9.5 will introduce a cache search that will let a user hunt through the history files by keyword; an Opera Links feature will synchronize all the bookmarks among different browsers on a PC. According to von Tetzchner, Opera 9.5 will also show a significant speed boost, thanks to greatly improved Javascript optimization, among other under-the-hood improvements.

"Some tests show it will be twice as fast [as the previous version]" von Tetzchner claimed. "Some tests even show it's as much as 10 times faster than Internet Explorer."

Although the company is still working on building market share in the States, it has become a significant player in the global market. Von Tetzchner told us the browser is popular in the Nordic region and Eastern Europe. Opera has also teamed up with companies like Tata in India to provide less technologically driven populations with mobile Web browsing services. In some areas, Opera mini is the main portal to the Internet. "In Bangladesh more people are getting on the Internet with Opera mini than a PC," von Tetzchner said. "It feels good when you're helping people get online."

The company is looking to hop onto the current trend of moving more software functionality onto the Web, von Tetzchner said. The company has spent a lot of time optimizing the browser to accommodate Web-based software—for example, by working with HTML 5 to create more compact and more accessible code. Doing so will allow more intelligent Web forms, he said. Opera also offers over 1,100 widgets and gives users the ability to create their own.

The company plans to release a beta version of Opera 9.5 in the next two months. The final version should be available by this summer.


Porn companies challenged by Internet sites

After years of booming sales supported by videotapes, DVDs and the Internet, the adult film industry is being challenged by easy video-sharing Web sites offering explicit content for free.

"We're dealing with rampant piracy, tons of free content," said Steven Hirsch, co-founder of privately held Vivid, the best-known studio making sex films.

Vivid once earned 80 percent of its roughly $100 million a year from DVD sales, but last year that fell to 30 percent, Hirsch said in an interview.

The Internet challenge, a topic of discussion at the biggest adult film expo of the year in Las Vegas this week, has already presented itself to the music industry and other mainstream entertainment.

Much of the Internet competition for the U.S. porn world, largely based in southern California, comes from Web sites like Toronto, Canada-based, whose format is modeled after Google's YouTube.

Some of the videos on the XTube site come from commercial studios while others are posted by amateurs.

"We're not pirates. We are providing a service that people think they can use to pirate," said Lance Cassidy, one of XTube's founders.

The Web site has 200,000 free videos, typically 30 seconds to two minutes long, and about 1 percent of visitors buy DVDs or video streams, resulting in millions of dollars of annual revenue, sales director Curtis Potec said. About two thirds of XTube's viewers are gay, Potec said.

"We've had tons and tons of people tell us this is the future of the adult industry," Potec said. "Most of the money is ads, on any site, mainstream or adult."

Scott Coffman, president of Adult Entertainment Broadcast Network (AEBN) in North Carolina, says his company started a YouTube-type site a year-and-a-half ago to generate revenue through advertising and drive traffic to pay-per-minute sites.

AEBN limits free clips to three minutes. Users make about a quarter of them.

"They don't convert that well when you give away so much. There is a fine line between giving away something small, a teaser ... and giving away the whole thing," Coffman said.

He said his company has revenue of about $100 million a year and is facing a lawsuit from Vivid accusing AEBN of piracy.

Vivid's Hirsch says he will sue other video-sharing sites.

"This industry is going to have to get together and look at these guys that are putting out the stuff for free ... so they are going to have to get in line and start paying for it," Hirsch said.

"If that doesn't happen and we see all of this free content out there, people are not going to be able to afford to produce movies anymore."


Videotape, fewer prosecutions, DVDs and Internet advertising created an unprecedented boom the U.S. sex film business since the 1980s.

Many studios post short clips on Internet video-sharing sites as advertising to sell more movies.

"This is something we constantly discuss in our office. Is it too much," said Garion Hall, chief executive of, an Australian company featuring lesbians.

Hall said only one out of 500 viewers clicks over to his site from free clips and of those only one in 50 subscribes.

Some adult industry executives say a solution may lie in future distribution deals with big companies such as AT&T Inc, Verizon Communications Inc, Comcast Corp and Apple Inc.

An Apple spokeswoman said the company would not comment if it had held past talks or was interested in distributing adult product. A spokeswoman for Comcast, the largest U.S. cable provider, said the firm offered adult content in its video-on-demand service but said she knew of no talks for mobile adult distribution.

Sales of sex films to mobile devices occur in Europe but have yet to take off in the United States.

"We won't make money through adult content," said Verizon Wireless spokesman Ken Muche.

AT&T did not comment.

Jay Grdina, president of ClubJenna Inc, a division of Playboy, says sharing previews is a mistake. "We're getting bitten by our own sword," he said.

Grdina, former husband and on-scene partner of Jenna Jameson, one of the industry's most famous porn stars, said he has met companies such as Microsoft and Apple to seek wireless and other distribution deals that could allow easy downloads to devices such as iPods.

A spokesman for Microsoft said they were not in talks to distribute adult content.

"The revenues are massive," Grdina said. But "the biggest fear is share price: what are the shareholders going to say?"


Don't Upgrade to Vista, UK Gov't Agency Tells Schools

British schools should not upgrade to Microsoft's Vista operating system and Office 2007 productivity suite, the British Educational Communications and Technology Agency (BECTA) said in a report on the software. It also supported use of the international standard ODF (Open Document Format) for storing files.

Schools might consider using Vista if rolling out all-new infrastructure, but should not introduce it piecemeal alongside other versions of Windows, or upgrade older machines, said the agency, which is responsible for advising British schools and colleges on their IT use.

"We have not had sight of any evidence to support the argument that the costs of upgrading to Vista in educational establishments would be offset by appropriate benefit," it said.

The cost of upgrading Britain's schools to Vista would be £175 million (US$350 million), around a third of which would go to Microsoft, the agency said. The rest would go on deployment costs, testing and hardware upgrades, it said.

Even that sum would not be enough to purchase graphics cards capable of displaying Windows Aero Graphics, although that's no great loss because "there was no significant benefit to schools and colleges in running Aero," it said.

As for Office 2007, "there remains no compelling case for deployment," the agency said in its full report, published this week.

The agency was equally skeptical about the benefits of Vista and Office 2007 last January, when it published an interim report based on its evaluation of beta versions of the new software. Then, it advised that the added value of Vista's new features was not sufficient to justify the cost of deployment, while Office 2007 contained no "must-have" features.

In this year's report, BECTA warned schools that do choose to use Office 2007 to avoid Microsoft's OOXML (Office Open XML) document format because of concerns about compatibility between different applications -- even though interoperability is one of the benefits Microsoft claims for the format.

It called on schools to make teachers, parents and pupils more aware of free alternatives to Microsoft's products, and asked the IT industry to facilitate their use.

The agency also recommended setting up desktops to make it easy to use such open-source applications, and advised schools to insist their suppliers deliver office productivity software that can open and save ODF documents, setting it as the default file format.

However, it slammed Microsoft for dragging its feet with incorporating support for ODF in Office 2007.

"While the product includes the functionality to read virtually every other relevant file format 'out of the box', the processes for dealing with ODF files are very cumbersome," BECTA wrote.

In addition, it said, ODF file converters provided by Microsoft are not intuitive because they behave differently from the regular file save dialogs.

"We believe that these arrangements present sufficient technical difficulties for the majority of users to make them disinclined to use competitor products and this may weaken competition," the agency said.


Microsoft President Raikes Retiring, Replacement Comes From Outside

Chairman and co-founder Bill Gates isn't the only one on his way out at Microsoft (NSDQ: MSFT). Business division President and long-time Microsoft employee Jeff Raikes is retiring in September, being replaced by Stephen Elop, the now former chief operating officer of Juniper Networks.

Raikes' last hurrah as business division president will be next month's launch of Windows Server 2008, SQL Server 2008, and Visual Studio 2008. He's one of Microsoft's longest serving employees, having joined the company in 1981 as a product manager.

"I've had an incredible journey here at Microsoft," Raikes said in a statement. "Given the success of our business and the depth of leadership we have in place, the time is right to leave the business in the capable hands of our new generation of leaders."

Raikes looked like a potential successor for Microsoft CEO Steve Ballmer, should he retire, having helped grow the Office brand in Microsoft's early days and, more recently, turned Microsoft's business division into a cash cow. Raikes has overseen a doubling of Microsoft business division's annual revenue, including 21 consecutive quarters of double-digit growth in the company's Server and Tools Business.

Replacing Raikes, Elop brings formidable technology experience to Microsoft. In addition to serving as Juniper's COO, Elop was president of Adobe's worldwide field operations after a stint as Macromedia's CEO.

Elop's background serves as a bit of a template for the direction Microsoft is moving. His experience with Macromedia and Adobe make him a good candidate to lead an Internet services push in product areas like Microsoft Office, while his recent job with Juniper places Elop to help Microsoft take on Cisco in the emerging field of unified communications.

At least during the transition phase from Raikes to Elop, Microsoft senior VP Bob Muglia, who heads up the company's server and tools business -- that includes products like Windows Server and Visual Studio -- will report directly to Ballmer.

Raikes is one of a few executives to announce their departure from the company this week. Charles Fitzgerald, Microsoft's general manager for platform strategy, is also leaving the company, a Microsoft spokesman said Thursday. And on Wednesday, Microsoft said merger and acquisitions chief Bruce Jaffe would be leaving the company next month.


Cellphone obsession leads Japanese children into a 'scary world'

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Young Japanese people are evolving a new lifestyle for the 21st century based on the cellphones that few are now able to live without.

While about one-third of Japanese primary school students aged 7-12 years old use cellphones, by the time they get to high school that figure has shot up to 96 percent, according to a government survey released last month.

They are using their phones to read books, listen to music, chat with friends and surf the Internet -- an average of 124 minutes a day for high school girls and 92 minutes for boys.

While the wired world they now inhabit holds enormous advantages for learning and communicating, it also brings a downside, say experts who point to a rise in cyberbullying and a growing inability among teenagers to deal with other people face to face.

"Kids say what's most important to them, next to their own lives, is their cellphone," said Masashi Yasukawa, head of the private National Web Counselling Council.

"They are moving their thumbs while eating or watching television," he said.

The passion in 20-year-old Ayumi Chiba's voice backs up this assertion.

"My life is impossible without it," she says of her cellphone. "I used to pretend I was sick and leave school early when I forgot to take it with me."

Hideki Nakagawa, a sociology professor at Nihon University in Tokyo, said cellphones have become "an obsession" for youngsters.

"They feel insecure without cellphones, just the way sales people do without their name cards," he said.

As the multi-faceted cellphone takes centre stage in teen life, it plays a number of roles -- including a weapon that children can wield against each other with no thought for the consequences.

Yasukawa recalls the case of a 15-year-old girl who regularly received messages telling her: "Die," "You're a nuisance" and "You smell".

They turned out to have been sent by a friend in whom she had confided and who told her not to take the messages too seriously.

"The girl who was doing the bullying confessed it made her feel good to see the unease spreading on her friend's face," Yasukawa said.

"Some children send nasty messages to a 'friend' while in her company, pretending to be looking at her profile page on the cellphone.

"It's a very scary world," he said. "Parents don't know there's a very scary world behind cellphone screens."

As they reveal personal information about themselves, children can become prey for fraudsters and paedophiles, as only about one percent have blocks on potentially harmful material.

But on protected sites such as school bulletin boards that do block adults, bullies are free to anonymously post comments without any teacher oversight or intervention.

"Bully-to-bullied relations can be easily reversed with a targeted kid pointing the finger at somebody else for some trivial thing," Yasukawa said, adding that this potentially created "a survival game among children".

Japan's largest mobile carrier NTT DoCoMo Inc. in December launched a line of cellphones for small children, with software ranging from picture books to school scheduling pads aimed at helping them to learn.

The cellphones will eventually become their main means of communication.

Education professor Tetsuro Saito said a survey of 1,600 middle school students aged around 14 found about 60 percent carried cellphones and nearly half used them to send 20 or more emails a day.

Most middle school cellphone users rarely used their phone to talk, the survey found. Saito, of Kawamura Gakuen Women's University near Tokyo, said children seemed to want the security of communicating with someone, without the bother of dealing with a real person.

"Communication ability is bound to decline as cellphones and other devices are now getting between people," he said.

Tomomi, 18, who would not give her full name, said: "I send some 20 emails a day. There are people I don't talk with -- even if I see them at school, I just exchange mail with them. I guess we're connected only by a machine."

Saito's survey found that students can also use their cellphones as an emotional crutch, and the more problems they have at home, the more dependent they seem to become on their phones.

More than 60 percent of students who said they do not enjoy being with their families send 20 or more emails a day, compared with 35 percent of those happy with their families.

And even if cellphones can bring solace, it can come at a terrible cost.

Kanae Yokoyama, 36, is facing trial for beating and spraining the neck of her 15-year-old daughter after catching her secretly using her cellphone in November.

The girl had been prohibited from using her phone as the bill had hit 120,000 yen (1,060 dollars) in October, mostly wracked up by downloading music and playing games, according to local police.

They said the mother had a history of abusing her daughter.

"Considering she was often absent from school, the mobile phone may have been her sole 'friend' to spend her days with," a police official said.


Warning on stealthy Windows virus

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Security experts are warning about a stealthy Windows virus that steals login details for online bank accounts.

In the last month, the malicious program has racked up about 5,000 victims - most of whom are in Europe.

Many are falling victim via booby-trapped websites that use vulnerabilities in Microsoft's browser to install the attack code.

Experts say the virus is dangerous because it buries itself deep inside Windows to avoid detection.

Old tricks

The malicious program is a type of virus known as a rootkit and it tries to overwrite part of a computer's hard drive called the Master Boot Record (MBR).

This is where a computer looks when it is switched on for information about the operating system it will be running.

"If you can control the MBR, you can control the operating system and therefore the computer it resides on," wrote Elia Florio on security company Symantec's blog.

Mr Florio pointed out that many viruses dating from the days before Windows used the Master Boot Record to get a grip on a computer.

Once installed the virus, dubbed Mebroot by Symantec, usually downloads other malicious programs, such as keyloggers, to do the work of stealing confidential information.

Most of these associated programs lie in wait on a machine until its owner logs in to the online banking systems of one of more than 900 financial institutions.

The Russian virus-writing group behind Mebroot is thought to have created the torpig family of viruses that are known to have been installed on more than 200,000 systems. This group specialises in stealing bank login information.

Security firm iDefense said Mebroot was discovered in October but started to be used in a series of attacks in early December.

Between 12 December and 7 January, iDefense detected more than 5,000 machines that had been infected with the program.

Analysis of Mebroot has shown that it uses its hidden position on the MBR as a beachhead so it can re-install these associated programs if they are deleted by anti-virus software.

Although the password-stealing programs that Mebroot installs can be found by security software, few commercial anti-virus packages currently detect its presence. Mebroot cannot be removed while a computer is running.

Independent security firm GMER has produced a utility that will scan and remove the stealthy program.

Computers running Windows XP, Windows Vista, Windows Server 2003 and Windows 2000 that are not fully patched are all vulnerable to the virus.


Thursday, January 10, 2008

New York launches antitrust probe into Intel

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New York state launched a formal investigation of Intel Corp on Thursday, to determine if the world's No. 1 chipmaker broke state and U.S. antitrust laws to squeeze out its main rival, Advanced Micro Devices Inc.

New York state Attorney General Andrew Cuomo said his office issued a broad subpoena seeking information after a preliminary probe raised questions about whether Intel coerced customers to exclude AMD from the worldwide market for microprocessors, the main computing engines of PCs.

Intel is facing similar investigations in Europe and Asia, although federal antitrust enforcers in Washington have so far declined to take up the matter.

Shares of Intel were down 1.1 percent in late afternoon trading on Nasdaq to $22.50, while AMD shares were up 7.8 percent to $5.96 on the New York Stock Exchange.

"Our investigation is focused on determining whether Intel has improperly used monopoly power to exclude competitors or stifle innovation," Cuomo said in a statement. "We will also look at whether Intel abused its power to remove competitive threats or harm competition in violation of New York and federal antitrust laws."

Intel spokesman Chuck Mulloy confirmed the company had received the subpoena and would "work very hard" to comply with the subpoena, in keeping with its normal practice.

"We believe our business practices are lawful and that the microprocessor market is competitive and is functioning as one would expect a competitive market to function," Mulloy said.

AMD said it had been contacted by Cuomo's office. "I can confirm that we have received a subpoena, too," said spokesman Drew Prairie.

Sen. Charles E. Schumer, a New York Democrat, said the U.S. Federal Trade Commission was remiss in not doing a similar probe.

"Antitrust investigations into Intel are springing up everywhere except Washington. It's high time the FTC woke up and started looking into practices that are harming American consumers and technological innovation," he said in a statement.

The New York Times reported in October that FTC Chairman Deborah Majoras had rejected requests by lawmakers, other commissioners and AMD to open a formal antitrust investigation into Intel.

"We typically don't even confirm the existence of investigations," FTC spokesman Mitch Katz said on Thursday.

According to a 2005 lawsuit AMD filed against Intel in Wilmington, Delaware, Intel abused its No. 1 position in the $30-plus billion market for microprocessors by encouraging its customers to avoid AMD. Intel has denied the allegations.

On Monday in Brussels, an Intel spokeswoman said the company had responded to antitrust charges filed by the European Commission and would seek a hearing. The commission charged Intel last July with slashing prices below cost and offering huge rebates in an illegal attempt to drive the smaller AMD out of the market.

The EC charges and the response are confidential.

In South Korea, the Fair Trade Commission filed antitrust charges against Intel in September 2007. The case is pending.

In Japan, the Fair Trade Commission concluded in 2005 that Intel violated that country's Antimonopoly Act. Intel disagreed with the findings but accepted the commission's recommendation, a move that allowed it to avoid a trial.


Slim Apple laptop expected at Macworld
As the annual Consumer Electronics Show in Las Vegas winds down to lackluster reviews, Apple is expected to grab the spotlight with an ultra-slim laptop computer and online movie rentals at its biggest annual show next week.

The new products are seen more as enhancements to Apple's current offerings rather than ones that pack the "wow factor" of last year's star attraction, the iPhone.

Next week's annual Macworld event in San Francisco is the favorite venue of Apple Chief Executive Steve Jobs to roll out new products and chart the company's course for the year.

His showman-like pronouncements also increasingly set the agenda for the computer and electronics industries, and have in recent years overshadowed CES, held in Las Vegas around the same time.

Apple gives no hint of what will be announced, so guessing what Jobs has up sleeve is a favorite pastime of analysts and industry executives.

Analysts expect a computer half as thick as Apple's current MacBook lineup, but using flash memory chips like those found in its iPod music players rather than a hard drive.

"The energy seems to be around a smaller-form-factor laptop computer," said Charles Golvin, an analyst with Forrester, a market research firm.

Notebooks have been one of Apple's strongest segments. In its fourth fiscal quarter ended last September, the company sold 1.34 million MacBook and MacBook Pro laptops, up 37 percent from a year earlier.

"What I'm guessing we might see from Apple is something a little more recognizable as a MacBook device, as a derivative of a laptop or tablet rather than a cool new form factor that sits between laptop and mobile phone," Golvin said.

Many also think Jobs will announce that customers will be able to rent downloaded movies from Fox, Warner Bros and others though its iTunes online store, a move that could shake up the $9 billion U.S. movie rental market.

"I think the rentals are a bigger deal," said Shaw Wu, an analyst with American Technology Research. "Apple has just simply not served that market yet and I think that's going to open up a whole new revenue opportunity."

Anticipation that Jobs will wow everyone with groundbreaking new products tends to drive Apple stock higher in the days ahead of Macworld, but can set shares up for a fall if the new products don't live up to expectations.

Although Apple shares, dragged down by mounting fears of a U.S. recession, have fallen about 11 percent since topping $200 on December 26, they rose 4.8 percent on Wednesday to $179.40.

The shares rose 8 percent the day Jobs unveiled the iPhone at last year's Macworld and have risen more than 90 percent over the past year on bullishness over sales of iPhones and Macintosh computers, which have been gobbling up market share.

And Apple has fared better than other computer companies such as Dell Inc, which has fallen 15 percent since the start of the year, and Hewlett-Packard Co.

"Apple's still going to be one of the better names to be involved in in the tougher environment. The product cycles are so strong," said Wu, who has a price target of $210 on Apple shares.

Many industry analysts see the polished message of Macworld as a welcome relief from the chaos of CES and its familiar parade of ever-larger televisions, sharper video cameras and slimmer cell phones.

"Apple didn't need to take thunder from CES, there was nothing to take," Michael Gartenberg, an analyst with Jupiter Research, wrote on the company's blog.