Intellact News

Hasta la Vista, Microsoft!

2007-08-30T09:03:00.000+01:00

It"s faster than Windows, it fights viruses - and it"s free. Jimmy Lee Shreeve on the software that"s bringing more power to our PCs Unless you use an Apple Mac - or you"re a particularly dedicated geek - your computer almost certainly runs a version of Microsoft Windows. There"s little choice in the matter; almost all consumer PCs come with Windows already installed. Can you be bothered to change that?

But now, this stranglehold has been broken. Dell, one of the global giants that supplies businesses and homes with PCs, is selling some of its PCs with Linux, a rival operating system, already installed.

Linux makes your computer run quicker, it doesn"t crash, it doesn"t catch anywhere near as many viruses, and it"s free. For a decade, it was available only for people to install themselves. But now, the geek"s favourite is coming to the masses.

Dell"s two Linux machines are the 530n desktop and 6400n laptop. Their prices are low - £399 and £329 respectively. That"s partly because the version of Linux they run is free. Also, Linux doesn"t work your PC as hard as Windows does, so you can get the same performance with cheaper, or older, hardware.

Many in the know prefer Linux. Michael Dell, Dell"s chief executive, is presumably not bothered by cost - he"s worth $15.8bn. And what does he run on his home laptop? Linux Ubuntu. He also chooses Mozilla"s free Firefox web browser and the free software suite OpenOffice. And that"s part of the problem for Microsoft. Linux isn"t just a threat to Windows; its users will also abandon Microsoft"s Internet Explorer and Microsoft Office, too.

Linux Ubuntu comes with everything you need. There"s a powerful office program with desktop publishing, an e-mail/organiser, a web browser and instant messager. You can use your iPod with it, too.

Windows, on the other hand, is continually under assault from the nasty side of cyberspace. And the software bundled with it is more basic. You get Internet Explorer and Outlook Express for web browsing and e-mail, a notepad, a paint program and a word processor, along with various media applications. If you want more software, you have to pay for it.

Linux already powers everything from supercomputers to mobile phones. Google runs more than 10,000 Linux servers. Amazon.com switched to Linux and saved a cool $17m. The French National Assembly has started using Ubuntu on more than 1,000 computers. And since the blockbuster movie Shrek, the Dreamworks studio has been using Linux to render its 3D graphics and special effects.

Linux was created in 1991 by Linus Torvalds, a student in Helsinki. It was released to his computer community, who made improvements. In 2003, Microsoft put Linux high on its risk list. "The general economic environment is risk and driver No 1," said John Connors, Microsoft"s then chief financial officer. "Linux and non-commercial software is risk No 2." Linux needs to pick up 2.5 million users a year to claim even 1 per cent of the market, but with Toshiba rumoured to be pondering a range of PCs with Linux installed, it could be the thin end of the wedge.

So is this the time to make a switch to Linux with your next PC purchase? Should you take Windows off your creaking old machine and give it a new lease of life, courtesy of Linux? Our table of comparisons will help you decide.

What's best about it?

What's worst about it?

How much does it cost?

Is it good for music fans?

What about photos and videos?

What if i need to use it for work?

Does it crash much?

How would i fight viruses?

Linux Ubuntu 7.04 "Feisty Fawn"

Should make your existing computer responsive and lightning-fast - switching it on, powering down, and launching programs are all so much quicker than on Windows. And unlike Windows, Ubuntu doesn"t slow down over time.

It may not have every feature you"d like - it"s quick because it"s stripped-down. Plus you could have difficulties getting Ubuntu to work with other hardware. It"s not quite as "plug and play" as Windows.

It"s free! But if you run into difficulties and need technical support you will have to pay for it (unless the free Ubuntu online forums can help, that is). This costs around £125 a year.

Comes with Sound Juicer, for ripping audio from CDs; Rhythmbox, for organising music and listening to internet radio (the closest thing to iTunes); Serpentine, for burning CDs; and Sound Recorder for recording anything on your PC.

"F-spot" lets you get them from your camera and organise them into albums. Movies and videos can be watched in the Totem Movie Player, which compares well to other movie apps that are available.

The powerful free office program, OpenOffice, comes as default with Ubuntu. Many say it rivals, or even beats, Microsoft Office. The word processor is particularly sophisticated. The presentation, spreadsheet and drawing components are equally impressive and easy to use.

No. Linux is renowned for being one of the most stable operating systems around.

The vast majority of virus attacks are not aimed at Linux. But if you are concerned, the excellent Aegis Virus Scanner comes with the Ubuntu package and can run in the background searching for dubious files or attachments as you work.

Linux Mandriva

Linux Mandriva is a more attractive and fully featured operating system than Linux Ubuntu, but some say it"s not as fast. The Beagle search is a big boon, enabling you to search documents, chat rooms, email and contact lists. It"s also very fast - and has an attractive, intuitive interface.

Some users report that Mandriva struggles when you want to plug in a new USB hard drive or flash memory stick - it"s not always as simple to set them up as it is with other systems.

The latest package, Mandriva Linux Discovery 2007 Spring For Beginners, costs just £34. If you haven"t had previous experience with Linux, you may also want the manual, at £21. The snag: it"s 292 pages long.

You can produce your own music with the Linux MultiMedia Studio. To store and play your favourite tunes you use Rhythmbox, which was inspired by Apple"s iTunes. It has all the usual features, including streamed internet radio and podcasts.

The Photo Album application is included, which does a great job of organising your snaps and lets you enhance colours and reduce red-eye. It also allows you to view slide-shows and print your snaps.

Evolution is the Outlook equivalent of Linux and lets you send e-mails and organise your calendar and contacts. Office 1.6.2 is a lightweight but more than adequate office suite.

Crashes aren"t common on any Linux system - so long as it is properly set up. If they do happen it is usually down to a hardware problem.

Linux rarely catches viruses, but the free Clam AntiVirus software is very easy to set up and automatically updates so it can look f or the latest viruses. Many Linux users feel comfortable not using any anti-virus software at all.

Windows Vista

Everything looks sharper and more vivid than it does on the outgoing Windows XP. The new Flip 3D application helps you quickly switch between the different windows, and the search features have been greatly improved, too.

Six months after it launched, gripes continue. Many people still complain that they can"t run their favourite programs on Vista, so many others are holding off upgrading from XP until a second edition of Vista arrives.

Around £180 for the home Premium edition (£120 if you have XP already). If you want all the bells and whistles, go for the Ultimate edition at around £320.

It"s on a par with Mac"s offering, and better than the Linux equivalents. The new Windows Media Player lets you rip CDs to your PC, buy new tracks, and link to an MP3 player.

All the basics are covered. Windows Media Centre also lets you browse your photos, put on slide-shows, play DVDs, watch and record TV shows from the web, download movies and watch your home videos. Or use Windows Movie Maker to cut your own home movie.

£290 buys Windows Vista Business, with its fax software, but you could buy a fax machine for that. MS Office costs £300 - but try OpenOffice, its free rival ( http://www.openoffice.org ).

Microsoft says Vista is the most stable release of Windows yet. Many users, however, are unimpressed - they complain of crashes on a daily basis, saying it may be feature-packed but it"s still not safe.

You"ll need to buy your own antivirus software, such as Norton Internet Security 2007 (around £40).

Windows XP

XP is in its final edition, so most bugs have been ironed out - unlike the newer Microsoft Vista package. Many programs don"t yet work with Vista (Mozilla, the maker of the Firefox browser, recommends you stick with XP), so it might be wise to keep using XP for a while yet if you already have it.

Microsoft will end support for XP Home Edition in a couple of years. This means you"ll have to ensure you keep your antivirus software up-to-date, but even so, security could still be compromised.

It"s no longer available in most shops, but you can pick up used copies on Amazon, and elsewhere on the web, from about £50 up to about £100.

Windows Media Player 10 will serve most of your music needs. It"s not as good as the music softeare in Vista or Mac OS X, but you can sync your music collection with over 70 different MP3 players. Smart Jukebox lets you burn music to CDs, rip your own CDs and listen to internet radio.

Photos can be viewed and organised in XP"s default viewer. Better still, download the free Irfanview ( http://www.irfanview.com ), which also doubles as a basic photo editor, and plays movies.

You can either pay for MS Office (£300 for the standard edition) or get the cheaper Microsoft Works for around £70. Alternatively, download the free Open Office, which zips along on XP and has all the features of MS Office, but doesn"t have the Outlook organiser.

Like all versions of Windows you"ll get the infamous "blue screen of death" now and again. One way to minimise this is to avoid loading too many programs, or plugging in too many different types of hardware at the same time.

It"s essential to run your own antivirus software. A good option is Avast! 4 Home Edition, which is free ( http://www.avast . com/eng/ avast_4_home.html). Otherwise you have to buy something like Norton Internet Security 2007 (around £40).

Mac os x tiger

It"s very easy to use and set up and has all the essentials included: calendar, e-mail and address book, and a web browser. The Spotlight search technology finds lost files in seconds.

Once you"re in the Apple world it"s hard to migrate to other operating systems. Apple provides everything - the hardware, software and OS - which tends to lock you in. You can"t just install it on a PC.

The basic operating system is £89. Since it"s so easy to easy to use, you"re unlikely to incur any extra technical support costs.

Mac"s iTunes still sets the pace, letting you buy audio and video from the iTunes store, rip music from your CDs and burn your own compilations.

iMovie records and edits videos, while QuickTime 7 lets you view them. And iPhoto organises and does some simple editing of photos and other images.

Networking and four-way video conferencing are bundled in. OpenOffice gives you a good free word processor, spreadsheet and so on. If you buy MS Office, you"ll see that Outlook isn"t made for the Mac, but Entourage is, and it does the same thing.

Mac OS is a very stable operating system and rarely crashes. An application might quit but the whole machine won"t freeze, so you don"t have to restart.

The Mac operating system is extremely secure. Viruses and worms that target Windows are virtually non-existent on the Mac. It also has built-in security settings so you can encrypt data and set various password-protection options.

Why Apple Can't Stop iPhone Hackers

2007-08-30T09:01:00.000+01:00

... AT&T and Apple may face an uphill battle prosecuting hackers who untether the iPhone from the AT&T wireless network.

It sure sounds like a steal. On Aug. 31, George Hotz plans to trade in his iPhone for a metallic blue Nissan (NSANY) 350Z sports car and three brand-new iPhones. But the 17-year-old's device is no ordinary Apple phone. Hotz hacked his iPhone and unlocked it so that it can be used on a variety of cell-phone networks, becoming the first person known to have done so. The person buying Hotz's phone, Terry Daidone, believes he's the one getting the deal because Hotz has agreed to work for him at his cell-phone refurbishing company, CertiCell. Daidone says he doesn't plan to sell unlocked iPhones just yet. Rather, he says that he wants Hotz to teach CertiCell's technicians the secrets to unlocking other kinds of cell phones. But that could change -- if he can clear up legal questions surrounding the practice of unlocking mobile phones. "As the need arises to unlock phones, we should be at the forefront of that," Daidone says.

Apple (AAPL) and AT&T (T), the sole authorized supplier of the iPhone in the U.S., are doing what they can to make sure that legal clearance never comes. The two companies have put their lawyers on the case, applying pressure on hackers involved in unlocking iPhones to try to get them to stop. Much is at stake. AT&T has been hoping that as the exclusive provider of the iPhone, it will see a surge in new customers and monthly service charges of at least $60 from each one. Apple is supposed to get a cut of the revenues. If iPhones are unlocked, they can be used on the wireless networks of rivals like T-Mobile USA -- and AT&T gets zippo. AT&T wouldn't comment for this story, while Apple didn't return a request for comment.

So will Apple and AT&T's legal action deter hackers? Hardly. Individual users are already allowed to unlock their own phones under an exemption to the Digital Millennium Copyright Act [DMCA] that the U.S. Copyright Office issued last November. The exemption, in force for three years, applies to "computer programs that enable wireless telephone handsets to connect to a wireless telephone communication network, when circumvention is accomplished for the sole purpose of lawfully connecting to a wireless telephone communication network."

What's less clear is whether companies and hackers can legally unlock the phones and then sell them to others, or sell unlocking software. "The law here is unclear," says Jonathan Kramer, founder of Kramer Telecom Law Firm in Los Angeles. "There just isn't any case law in this area for us to figure out how it plays out."

Experts believe that AT&T and Apple will point to the DMCA's section 1201, stating that "no person shall circumvent a technological measure that effectively controls access to a work protected under this title." They will claim that a phone lock is just such a technological measure that protects copyrighted work: namely, cell-phone software.

Problem is, it could be argued that, in reality, the lock only protects access to a carrier's communications network -- and communications services aren't copyrightable under the Act, explains Jane Ginsburg, professor of literary and artistic property law at Columbia Law School. "This law was written for DVDs and video games," she explains. "What's going on here is using the Copyright Act to achieve another objective."

Indeed, this time, hackers may have the law on their side. Remember, decades ago, automakers built their instrument panels so that only authorized radios of their own manufacture would fit in. Eventually, U.S. courts ended that practice. "If Apple and AT&T push too hard, they might see a revision of [the Copyright Act, and it won't be in their favor]," says Richard Doherty, director of consultancy the Envisioneering Group.

That's why, for now, some hackers contacted by AT&T lawyers still plan to release their wares. "Over the next few days you will get what you are looking for," promises an Aug. 27 message posted on the Web site of UniquePhones, which helps people unlock mobile phones.

Demand for unlocked iPhones, which sell for $499 and $599, is rising. Already, the phone has become a cultural phenomenon, with enthusiastic fans going to great lengths to get their hands on one. Consumers in rural areas where AT&T doesn't have a network or in markets with spotty AT&T coverage may want to use the popular device through T-Mobile's network. Overseas, consumers want to try it in conjunction with Orange (FTE) and Vodafone (VOD) wireless service. "If Apple offered unlocked iPhones for $1,200, they'd probably sell some," Doherty says.

Frustration over locked iPhones is showing up in the courts as well. A class-action lawsuit filed on Aug. 27 in the Supreme Court of the State of New York tells of an iPhone buyer who racked up $2,000 in charges because he couldn't use a different carrier's network while he was on a trip to Mexico. Filed against Apple, the suit claims the plaintiff didn't know that iPhone was tethered to the AT&T network.

Many hope that the legal wrangling will, eventually, result in major shifts in how the U.S. wireless industry operates. For one, a case could pave the way to making all wireless networks more open to unlocked phones. In the next five years, 10% to 15% of U.S. wireless users could move to unlocked phones, figures Andrei Jezierski, founder of venture consultancy i2 Partners in New York [see BusinessWeek.com, 12/4/06, "Motorola, Nokia Set Cell Phones Free"].

Plus, to answer pent-up demand for untethered phones, a cell-phone carrier could differentiate its offerings by selling all of its handsets unlocked, says David Chamberlain, an analyst with consultancy In-Stat. "It's an anomaly that the phones are tied to individual carriers," he says. "Can we change that business as usual? Maybe. But people who want that will fight for a very long time."

Nokia breaks into music, gaming services

2007-08-30T08:58:00.000+01:00

Nokia, the world's largest cell phone maker, unveiled an online music store, a gaming service and four new multimedia handsets in a move to take a greater share of consumer spending from mobile operators.

Nokia, which sells more than one third of the world's cell phones and is seeking new sources of revenue as that industry matures, said its core market of making mobile handsets was just "not enough anymore."

"We are trying to make the cake bigger for everyone: our piece grows, but also operators will benefit through data revenues," Tapio Hedman, head of marketing for Nokia's multimedia unit said.

Nokia's shares jumped to their highest level in more than five years on the news. But some of its top customers -- mobile phone operators that have built their own music service offerings -- reacted with caution.

"Some operators in Europe will not like this at all," said Shaun Collins, managing director at research firm CCS Insight.

Nokia Chief Executive Olli-Pekka Kallasvuo said at an all-day event in London that the company would start to sell touch-screen phones -- Nokia's answer to Apple Inc's iPhone handsets -- using its popular S60 software next year.

Nokia shares jumped to levels last seen in April 2002 and then closed 4.6 percent higher at 23.31 euros in Helsinki.

Nokia said it would wrap mapping services, its new music store and gaming services into an Internet service offering under new brand "Ovi," a Finnish word for "door."

" Nokia is seeking to become a gatekeeper to services to increase brand loyalty -- one brand with several hooks," said Glitnir analyst Jussi Hyoty. Nokia said it aimed to introduce the brand to consumers on a step-by-step basis, combined with its other advertising campaigns.

Nokia unveiled a top-end music and gaming phone, the N81, and a new version of its top profit generator, the N95 handset, its key rival to the iPhone. Nokia also unveiled two mid-priced music phones: the Nokia 5310 and 5610.

"The range of new handsets with good storage steals a march perhaps on iPhone. If they can get the high-storage device out before the iPhone hits (Europe), that would be a good idea," said Daniel Winterbottom, an analyst at research firm Informa.

Apple, which broke into the cell phone industry this year, saw its long-awaited iPhone handsets fly off shelves when the sleek, touch-screen multimedia device hit U.S. stores in June. Its European launch is expected later this year.

Nokia said it would roll out its own music store in key European markets -- Britain, Germany, France, Italy and Spain -- later this year, with songs selling for 1 euro ($1.36) each, a similar price point to Apple's iTunes.

Nokia's music store will start with a couple of million songs, compared to more than 5 million titles in iTunes.

"This service isn't sufficiently differentiated to make a major impact in terms of convincing consumers to either start using legal download services, or wean them off of Apple's service and dedicated music devices," said analysts at Forrester.

Nokia said it hopes to benefit from its presence in more than 130 countries in tailoring music offerings to local tastes.

Analysts said the music industry would welcome a serious alternative to iTunes, which dominates the digital music distribution market. But shares in Apple rose nonetheless, fueled by excitement over the pending launch of new iPods.

Vodafone in mobile broadband fast lane

2007-08-30T08:55:00.000+01:00

Vodafone is upgrading its mobile broadband services to offer speeds that are 10 times faster than the current "standard".

From 3 September subscribers will be able to download content up to 14 times faster and upload at around 10 times the speed via HSUPA (high-speed uplink packet access) technology.

The upgraded service will be rolled out during the autumn, starting with central London and major airports - including the London airports, Birmingham and Manchester - before being pushed out to the rest of the country.

Laptop users will be able to subscribe to the service for 49 per month on an 18 month contract which can be purchased online or in-store.

Vodafone will offer a 'plug and go' USB modem as well as two datacards, known as ExpressCards, one of which is a 'plug and go' datacard and another said to be more suitable for corporate customers.

Each device will have two antennas to boost connectivity in weaker signal areas.

Download speeds of up to 7.2Mbps will eventually be possible but initially speeds will range between 1.7Mbps and 5.5Mbps, allowing users to download a 5MB file at a minimum of seven seconds, 14 times faster than standard 3G.

Upload speeds will also be boosted to 1.44Mbps, 10 times faster than 3G currently.

Vodafone cut its 3G mobile broadband prices at the beginning of July, with the monthly tariff falling from 45 to 25.

Security slows UK wireless uptake

2007-08-30T08:54:00.000+01:00

Employee mobility (43%), convenience (23%) and increased productivity (12%) are the key factors driving wireless network adoption by UK businesses according to recent industry rese Employee mobility (43%), convenience (23%) and increased productivity (12%) are the key factors driving wireless network adoption by UK businesses according to recent industry research conducted on behalf of wireless network assurance solution provider, AirMagnet. The research demonstrated that although British companies are increasingly aware of the benefits offered by wireless connectivity in the workplace, concerns about security and poor performance continue to hold back wLAN (wireless local area network) adoption for many firms.

The survey found that 43 per cent of companies who have so far resisted wireless adoption in the workplace have done so because they are concerned about how to ensure the wireless network’s security. A further 29 per cent are delaying implementation because they perceive wLANs to be slower or less reliable than traditional wired networks.

Wireless technology can be highly effective in giving firms a competitive advantage over their peers through increased productivity. Access to a wireless network enables increased productivity via remote working and offers businesses more efficient use of resources and infrastructure without sizeable installation costs. These benefits are clearly being felt by business who have already made the transition to wireless with almost two thirds (63%) of those already using the technology saying they intended to increase investment in their wireless network in the future.

Ian Schenkel, MD EMEA at AirMagnet comments: “The research demonstrates that although many companies have already moved to a combination of wired and wireless networks in the office to increase employee productivity, incorrect preconceptions are continuing to hold many more back. This means that most are still missing out on the increased productivity, mobility and convenience delivered by wireless networks.”

Schenkel continues: “The security concerns expressed by respondents are easily addressable using a variety of different methods.

For example, point monitoring using a mobile device or laptop solution allows users to identify isolated risks. Ad hoc or continuous monitoring with an enterprise level tool which alerts users to any potential threats or security weaknesses, in some cases proactively scanning the network for potential issues, adds a further level of security to protect users.”

“The perception that wireless networks are less reliable than their wired counterparts seems to linger on but this does not have to be the case. In order to ensure coverage and reliable performance as well as fast speeds users simply need to plan ahead. Today’s WiFi survey tools are able to analyse sites, locating the best position for access points and avoiding interference such as glass, lift shafts and metal doors prior to implementation. In the case of an installed network, a survey tool can offer a clear understanding of potential obstructions and where extra access points could be of use in the future –avoiding the concerns identified by respondents.”

Deutsche Telekom pins hopes on IPTV to lure customers

2007-08-30T08:52:00.000+01:00

Deutsche Telekom hopes to tap into the growing market for television over the Web with new packages and lower prices in its drive to keep and win back customers. Europe's largest telecoms group by sales said it plans to gain 100,000-200,000 new customers by the end of this year for its Internet-based TV, said board member Timotheus Hoettges at a press conference ahead of the start of a trade fair in Berlin.

Internet Protocol TV (IPTV) will be available to 17.2 million households by the end of 2007, Hoettges said. The service currently reaches 15 million households.

The Bonn-based company is offering new products to attract customers to compensate for a steady loss of customers in its traditional fixed-line business.

IPTV is television programming provided via broadband cable and allows viewers to watch what they want when they want. It also has high-definition images and fast downloads.

For fixed-line operators like Deutsche Telekom IPTV is seen as a chance to compete against cable companies' all-in-one packages of video, voice and Internet services.

"IPTV is ready for the mass market," Chief Executive Rene Obermann said, adding the company planned to expand its high-speed VDSL network across Germany. It currently reaches 27 cities.

Its ADSL2+ technology is installed in 750 towns and cities.

ADSL is a form of DSL (digital subscriber line) that enables faster data transmission over copper telephone lines. ADSL2+ doubles the speed of transmission.

Subscriptions to IPTV services across Europe are expected to rise to 5.6 million this year from 2.9 million last year, with subscription revenue rising to more than 1 billion euros from 470 million euros, according to media research company Screen Digest.

Eyes on the Road: Digital Dream, Driving Reality

2007-08-29T09:45:00.000+01:00

I am not a tech-savvy guy. Still, when I get into my car for the morning commute, I bristle with digital devices. I have an iPod full of music, a BlackBerry that doubles as a phone, and a CD loaded with MP3s of tunes passed along by offspring or friends who want to upgrade my musical tastes. On the way to work, I am tempted to fumble with the iPod's touchy selector wheel to find the podcast of that NPR quiz show I like. Or I might punch a number into my phone handset to make a call. Either way, I am endangering myself and other drivers. I know email messages are stacking up in the BlackBerry. I know I mustn't read them at 65 miles per hour, despite my anxiety about missing a note that will betray my abuse of the "present while absent" function that comes with a BlackBerry subscription.

But the dream of turning cars into digital communication hubs hasn't died. Now, car makers and technology suppliers are rallying to take another shot and to develop a safe way for drivers to manage their digital clutter and connectivity angst while on the road.

Ford Motor Co., for example, hopes to generate buzz with a system called Sync, developed in collaboration with Microsoft Corp. and being rolled out on about a dozen Ford, Lincoln and Mercury models.

Ford's effort grew out of the frustration of a small group of Ford engineers with the auto industry's tendency to lag behind personal-electronics trends, says Gary Jablonski, manager of infotainment system engineering for Ford in Dearborn, Mich. "Customers want the same stuff in their cars that they see in Best Buy," he says. "We are generally a year behind."

Their idea: Develop a system, using a variant of Microsoft's Windows CE software, that can link to various digital devices using either Bluetooth wireless technology or a USB port. Then, no matter what kind of device is involved, the system can operate it using a voice-recognition system or the buttons, knobs or touch screens provided for the car's basic audio system.

If I had a Sync-equipped car, my morning drive might go like this: I would plug the iPod into a USB port in the storage bin under the center armrest and pair my BlackBerry with the car's audio system using Bluetooth.

To get the iPod to play, I could tell the system, "Play genre jazz," and the iPod would start playing tunes in that category.

To make a call, I could say, "Phone," and then say the name of a person listed in the phone's contact list. I could also sound out numbers. Using the phone hands-free would keep me legal in states that have rules against juggling the handset while in motion. However, there's considerable evidence that just carrying on a phone conversation is a distraction that undermines driving performance, whether you have a hand on the phone or not.

Provided I had the right kind of phone, I might command the system to read aloud text messages -- a better choice than reading them from the phone screen at highway speeds. The Sync system will even translate text abbreviations, such as "LOL," or "CUL8R," Mr. Jablonski says.

Perhaps Ford and Microsoft could develop a home edition of to decode the speech of teenagers for their parents' benefit.

The most impressive trick Mr. Jablonski performed was finding a British radio site on his Web-enabled phone and then piping the broadcast wirelessly from the phone to the Edge's sound system. Not every phone could do that, he cautions.

So how will all this go over in the real world, where Internet radio broadcasts time out, phone calls drop, Bluetooth earpieces produce annoying echoes, and PC software crashes?

The market-research firm J.D. Power & Associates this month released an outline of its latest survey of consumer interest in new automotive technology, which offers some encouragement and some caution for products such as Sync.

The good news is that half of the consumers polled for Power's 2007 emerging-technologies study said they would be interested in paying as much as $100 to get a USB interface in their next car. Asked if they'd pay $150 to get an iPod interface, about 43% said yes.

At a theoretical price of $200, "wireless connectivity" came in at No. 8 among 19 different technologies listed, according to Power. Ford plans to charge almost double that, about $395, for Sync as a standalone option. (It will be standard on the Lincoln lineup.)

However, Power's survey indicates consumers are generally more inter ested in certain safety technology; smart air bags, backup assistance systems and run-flat tires ranked 1, 2 and 3, respectively.

When it comes to entertainment systems, consumers want to be able to use their digital music players in the car. But they also express considerable enthusiasm for premium sound systems, and particularly systems bearing recognized high-end audio brands, says Power's Mike Marshall.

Among consumers who say they are interested in "premium audio" at a cost of $500, about 80% are willing to pay double that to get a name brand, such as Bose, he says. The top three brands, Mr. Marshall adds, are Bose, Alpine and Sony. This is no longer a luxury phenomenon. Nissan Motor Co. is offering a Rockford Fosgate system on its Nissan Sentra compact.

By Joseph White

How to keep the lid on a good idea...

2007-08-29T09:43:00.000+01:00

Investors on the hunt for funds risk communicating their key concepts to potential rivals.

For the entrepreneur, balancing the need to protect a business idea and the need to share it with potential investors and partners can be tricky. That is especially so in Silicon Valley where thousands of would-be technology moguls are racing to create the next big thing, and where good ideas, sometimes based on merely a few fleeting bits of software code, have a way of spreading around.

'My advice to early entrepreneurs is be careful,' says Jerry Kennelly, co-founder and chief executive of Riverbed, a networking equipment maker. 'Don't disclose more than you have to.'

His is the voice of experience. In 2002, when Steven McCanne approached him with an idea for a new technology that would dramatically increase the speed of corporate computer networks, he knew he would be collaborating with someone he could trust.

The two men had worked together at Inktomi, a bubble-era online start-up whose pay-per-click revenue model was later perfected by Google. They also happened to be neighbours in the college town of Berkeley, just across the bay from San Francisco. In addition to being an entrepreneur, Mr McCanne is an engineering professor at the University of California at Berkeley.

'We had talked off and on,' says Mr Kennelly. 'We both wanted to be entrepreneurs again and to have our own company. I had gone over one Saturday to help him mow the lawn, and he mentioned he had this technology. So we met at a coffee shop in Berkeley. We had coffee, shook hands, and on Monday he went in and quit his job.'

By the time Mr Kennelly left his own job several weeks later, they were ready to get Riverbed off the ground. 'The first thing we did after we incorporated was pick a law firm to draw up a non-disclosure agreement,' says Mr Kennelly. 'We made sure we had clean title to any software code wedeveloped - we'd never pay anyone to do anything unless we hadfull ownership of all the intellectual property they made for us.'

Mr Kennelly, who had also worked at Hewlett-Packard and Oracle, says: 'I'm a trusting guy and, in general, people in big companies are decent, honest, moral people. When you get to the start-up world, it's different. It's people struggling to get by. It's people trying to finance, to get rich. They're not bad people, but everyone is on the make.'

But while non-disclosure agreements help protect an idea when shopping it around to potential employees or partners, they are of little use when it comes to pitching a company to venture capitalists. As a rule, VCs do not sign non-disclosure agreements.

'It's very different when you're recruiting co-founders or employees than when you're pitching for money,' says Furqan Nazeeri, a serial entrepreneur who now works as an entrepreneur-in-residence at SoftBank Capital, a Boston-based venture capital firm. 'When you are pitching for money, VCs talk to each other a lot, so it's more likely the information is going to be passed on.'

Paranoia about venture capitalists can be extreme in Silicon Valley. Jessica Livingston, a venture capitalist and author of Founders at Work, a book about the early lives of companies, points to the example of Sabeer Bhatia and Jack Smith, the founders of Hotmail.

The two knew they were on to something big when they started seeking funding for the world's first web-based e-mail service. They became so paranoid that they pitched venture capitalists a completely different idea.

'Once they sort of felt out the investors, and decided they wanted to work with them, it wasn't until then that they told them about the real idea, which was web-based e-mail,' says Ms Livingston.

Steve Jurvetson, a partner at Draper Fisher Jurvetson, one of Hotmail's venture backers, says entrepreneurs tend to go overboard when it comes to secrecy. Concerns about venture capitalists chatting about start-up ideas with each other or their portfolio companies, he says, are overblown. 'We don't share things with other VCs,' he says. 'Our ability to do our job is predicated on the trust entrepreneurs have in what we are doing.'

Not all venture capitalists may be so scrupulous.

'The first VC we went to didn't want to fund our company,' says Mr Kennelly. 'They wanted us to join an existing company of theirs. Lo and behold, about 15 months later the company came out with a copy of our original idea.'

In that case, the aggressive intellectual property strategy Riverbed adopted from the outset paid dividends. 'By then, we had already patented it. They folded and went out of business. Had they not folded, we would have challenged them,' he says.

Venturing groups inside big, established companies can present a bigger problem. 'I do caution entrepreneurs to treat corporate backers very carefully,' says Mr Jurvetson. Once the seed has been planted, he says, 'corporations can execute very well on an idea'.

Mr Kennelly's experience at Riverbed bears this out. 'VCs often bring in an outside expert to help them understand what you are talking about. The second firm we saw brought in a Cisco employee who was on their payroll onthe side. That made us verynervous.'

Cisco, the world's biggest maker of data networking equipment, eventually funded a Riverbed competitor, according to Mr Kennelly.

Noam Wasserman, a professor at Harvard Business School who specialises in entrepreneurship, says start-ups can lessen the risk of theft of their idea beforethey make a pitch to would-be investors.

'Entrepreneurs should do due diligence on the people who will be seeing the pitch,' he says. 'This can be done via word of mouth, or even online via sites like TheFunded and LinkedIn.'

Entrepreneurs should also think of an initial pitch as the first in a series of meetings in which a start-up team and its potential backers can feel each other out and try to establish a bond of trust.

'Just as trailers for movies show enough to whet the moviegoer's appetite for more, the initial pitch should also whet the investor's appetite for more,' Prof Wasserman says.

Another lesson founders should bear in mind is that ideas are just one part of what makes a successful company. Much of the success - most of it, many would say - comes down to implementation.

'It is only in retrospect that you know you have a big idea,' says Mr Nazeeri. 'Implementation is a lot of work but it's the thing that you can have a lot of impact with. Successful businesses have a combination of both.'

Sony software makes PCs vulnerable, researchers say

2007-08-29T09:42:00.000+01:00

Software included with high-end memory sticks sold by Sony Corp can make personal computers vulnerable to attack by computer hackers, according to researchers with two Internet security firms. Sony's MicroVault USB memory stick and fingerprint reader includes software that creates a hidden directory on the computer's hard drive, researchers with Finnish security software maker F-Secure Corp reported on the company's blog on Monday.

Such software that hides itself, which is known as a root kit, leaves room for hackers to secretly infect personal computers, they said.

Software that is installed on such hidden drives is not only invisible to the human eye; some types of computer security software are unable to detect viruses and other types of so-called malware, or malicious software, stored on them.

F-Secure's blog posting said it attempted to contact Sony before alerting the public about the software, but the company had not replied.

Sony spokesman Chisato Kitsukawa said he could not immediately comment on the situation.

On Tuesday, researchers with McAfee Inc. said they had confirmed the vulnerability described by F-Secure.

"The apparent intent was to cloak sensitive files related to the fingerprint verification feature included on the USB drives," said McAfee spokesman Dave Marcus. "However, software creators apparently did not keep the security implications in mind. The application could be used to hide arbitrary software, including malicious software."

This is not the first time F-Secure has found Sony software installing hidden directories on the drives of its customers. In 2005 there was a similar situation involving the electronics maker's digital rights management software, security experts say.

Google CFO Reyes plans to retire by end of year

2007-08-29T09:40:00.000+01:00

Google Inc said on Tuesday finance chief George Reyes plans to retire, ending a bumpy five-year ride for an executive charged with trying to manage ferocious growth while upholding a policy of refusing to give financial forecasts.

As chief financial officer, Reyes, a veteran Silicon Valley financial executive, worked out of the public spotlight in a company led by its two co-founders, Larry Page and Sergey Brin, and its chairman and chief executive, Eric Schmidt.

Reyes, 53, helped spearhead the initial public stock offering of the world's top provider of Web search and online advertising services in August 2004. The stock has risen fivefold in the three years since then.

But Google investors received a shock in July when a surprise 13 percent jump in second-quarter hiring and rising operating expenses led to a rare profit disappointment.

The stock, which traded upward of $550 in mid-July, has declined since then, closing at $506.40 on Tuesday.

"They need a higher-caliber CFO, many people on Wall Street will tell you," said Martin Pyykkonen, a financial analyst with Global Crown Capital. "He had a couple of snafus."

Pyykkonen said the recent quarter had exposed a lack of internal financial controls that could have helped to rein in Google's aggressive hiring and averted the disappointment.

As a financial manager, Reyes played a notably subservient role within a company famously led by and for engineers. Efforts by Google's leadership to keep Wall Street at arm's length further marginalized Reyes role as a senior executive.

Google's spectacular growth in revenue and profit served to mask investors' concerns about Reyes, the analyst said. Wall Street analysts expect Google revenue to more than double its 2006 level by the end of 2008, growing to $21.8 billion.

"When the machine has been running on autopilot, you can hide a lot of inefficiencies," Pyykkonen said.

Reyes will help in the search for his replacement, and the Mountain View, California-based company expects the transition to be completed by the end of the year.

His total compensation package was worth about $1.7 million in 2006, according to the company's annual proxy statement. He held stock options at the end of last year that would have yielded him $23.6 million, according to the government filing.

Reyes previously served as interim CFO of optical networking equipment company ONI Systems before it was sold to network communications gear maker Ciena Corp in 2002.

For 13 years, he held various financial executive positions at computer maker Sun Microsystems Inc .

Reyes serves on the boards of two Silicon Valley software makers: Symantec Corp and BEA Systems Inc . He was never a member of Google's 10-member board of directors.

He is the uncle of Gregory Reyes, the former chief executive of Brocade Communications Systems Inc , who earlier this month was found guilty on all counts in the first U.S. criminal trial for backdating of stock options.

AT&T puts media buying account into review

2007-08-29T09:38:00.000+01:00

AT&T Inc said on Tuesday it would review its media buying, seeking to cut the number of agencies that work on the key account from a handful down to just one. At the moment, the telecommunications company splits the work of buying advertisements among Omnicom Group Inc agencies GSD&M and OMD, Publicis Groupe SA agency Digitas, WPP Group's Mediaedge:CIA and Interpublic Group's Initiative agency.

"This move will consolidate all of AT&T's media planning and buying at one agency and is part of the company's ongoing efforts to maximize efficiencies created, in part, by AT&T's acquisition of BellSouth at the end of last year," it said in a statement.

AT&T hopes to have a final decision by the year-end. Only the incumbent media agencies will be included in the review.

In the first quarter alone, AT&T spent an estimated $512 million on advertising, according to recent figures from TNS Media Intelligence, which tracks expenditures, putting the telecommunications company among to biggest U.S. marketers.

The Skeptic: Questioning The BT Model

2007-08-29T09:36:00.000+01:00

Viviane Reding, the E.U. media commissioner, is holding up the leading U.K. telecommunications company, BT Group, as the model on which the rest of the union's former monopoly operators should be run.

But that's not comparing apples with apples.

The other telcos are right to object because the E.U. would be penalizing them for being strong where BT is weak, and for being weak where BT is strong.

Balancing customers' best interests and those of the shareholders in BT's continental European rivals, content their companies' different strategies, is going to prove a delicate business for Reding.

In 2005, BT split its wholesale and retail divisions, creating Openreach, a separate business to allow rival operators access to BT's own local network. Revenue BT lost as a result was offset by success in developing already diverse alternative revenue streams.

In 2006, BT Global Services, its IT unit, contributed 33% of overall revenue, more than BT's retail division at 32% and just less than its wholesale division's 35%.

But BT's rivals run their businesses differently. They are more focused on their fixed line and broadband businesses.

BT was never a dominant player in the U.K. Internet service-provision market, facing stiff domestic competition from numerous rivals. Allowing them greater access to its networks didn't have a significant impact on its operations.

Deutsche Telekom, by contrast, is the leading broadband provider in Germany, with 41% of subscribers in 2006. France Telecom had a 50% share of its domestic market in 2006. Even more dominant is Telecom Italia, with a 57.5% share.

DT does have a services division, T-Systems, but it's struggled for some time with an uncompetitive cost structure. DT is currently looking to transfer 16,000 jobs from T-Systems to a joint venture. France Tel's equivalent unit is also a straggler.

To force a split on the telcos and make them share their networks, and thereby increase the competition in their markets, would dent the telcos' dominant positions that they have fought hard to protect in face of occasionally tough but certainly persistent regulatory pressure.

In as much as that would be good for customers, Reding is on the right track.

But the telcos are right to wonder what incentive they'll have to keep up the massive investments in infrastructure required to deliver new services such as ultrafast broadband if revenue is to be hit by increased competition at the same time.

Telecom Italia plans to invest EUR6.5 billion over the next ten years in upgrading its network. France Telecom wants to spend up to EUR3 billion from 2009 on its new fiber network.

France Tel has said that it's willing to proceed with its investment only if France scales back regulations forcing it to unbundle parts of the network. DT is involved in a court battle with the E.U. regulator over denying competitors access to its new ultra-fast network.

So the lingering mission BT's former state-owned rivals have as providers of public services will ensure the E.U. has a fight on its hands if it wants to rush through a new phase of telecoms deregulation.

TV phone-inscandals hit RTL Group

2007-08-29T09:34:00.000+01:00

RTL Group, Europe's largest broadcaster, has been hit by the phone-in scandals plaguing the UK TV industry. It announced a writedown of its UK channel that marred news of strong growth in its German arm in the first six months of 2007.

The TV and radio group, controlled by Bertelsmann, the German media company, wrote down the value of Five by Euros 123m ($168m), or almost half of the goodwill from its acquisition of the UK broadcaster, because of collapsing revenues from phone-ins coupled with higher programming costs. Five was among several broadcasters fined for rigged TV phone-in competitions. The write-down comes in spite of a more bullish assessment of the UK advertising market but follows Five's aggressive £30m ($60m) a year bid to snatch Neighbours, the soap opera, away from the BBC.

RTL has invested in the launch of two digital channels in the past year and said the move had raised combined market share to 6.3 per cent from 6 per cent at the same point the previous year.

But start-up costs for the digital channels saw RTL's UK earnings before interest, tax and amortisation (ebita) fall to Euros 5m from Euros 15m in the first six months of last year. UK revenues rose 8.3 per cent to Euros 242m over the same period.

Telefónica facing further delay to Telecom Italia buy. Gobbles up another....

2007-08-29T09:32:00.000+01:00

Brazil's telecommunications regulator Anatel could delay even further its long-awaited decision on Telefónica's acquisition of a sizeable stake in Telecom Italia, which would give the Spanish telecoms giant an interest in both Vivo and Tim Brasil, Brazil's two largest cellphone operators. Anatel was expected to issue a ruling before the end of August, although reports in the Italian media yesterday suggested that the decision could be put off until at least September. Telefónica and several Italian investors are looking to acquire a 23.6-percent stake in Telecom Italia that would make the consortium the Italian group's largest shareholder. Telecom Italia in turn controls Tim Brasil, while Telefónica already possesses half of Vivo, a joint venture in Brazil with Portugal Telecom.

Buffalo flies the flag for Blu-ray format... sort of

2007-08-29T09:29:00.000+01:00

Buffalo appears to be throwing its weight behind Blu-ray Disc, sort of. The manufacturer has announced that it plans to release a drive capable of reading both Blu-ray and HD DVD, but which is only able to write to discs in the Blu-ray HD format.

The drive, which will be offered with a USB 2.0 interface, will provide a whopping 6x write speed to a single-layer, 25GB BD-R disc and a 4x write speed to dual-layer BD-R disc. It will also provide a 2x write speed to a single- or dual-layer rewriteable BD-RE disc.

BD and BD-R read speeds come reach 6x too, dropping to 4.8x for dual-layer media. Again, the drive reads BD-REs at 2x, no matter how many layers the discs contain.

The drive will read single- and dual-layer HD DVDs at 3x.

Buffalo's drive will also offer writing capabilities to more traditional formats, such as DVD, where users will benefit from faster data-write times than with BD media.

European Blu-ray fans will have to sit tight for the time being through, because the drive is only due to be released in Japan towards the end of next month, for ¥74,800 (£321/€473/$647).

Earlier this month, small form factor PC manufacturer Shuttle launched a custom-build PC available with either a Blu-ray writer or combo drive crammed into its tiny frame.

Amimon ships wireless HDMI chipset

2007-08-29T09:27:00.000+01:00

Your next TV and DVD player may prove capable of connecting wirelessly, according to chip manufacturer Amimon. The company has just started shipping a chipset based on its Wireless High-Definition Interface (WHDI) standard, that allows wireless streams of uncompressed HD video and audio to be broadcast around your home.

The chip enables the delivery of uncompressed 1080p HD content at datarates of up to 3Gbps through a 40MHz channel in the 5GHz unlicensed band. In addition, 720p, 1080i and 1080p at 24-30fps, with data rates of up to 1.5Gbps, can also be delivered through a 20MHz channel by the chip.

Amimon claimed that its chip is the only such one on the market capable of covering an entire house, with a range of over 30m and the ability to penetrate dividing walls.

It said the chip experiences a latency of less than 1ms and forecats that it will enable consumers to eliminate all their A/V wires and cables.

Amimon said its chipset will be integrated into consumer electronics products by the end of this year, with a wider variety of devices set to arrive during 2008. Manufacturers Loewe and Funai are both due to demonstrate devices based on the chip at the IFA consumer electronics show, which kicks off in Berlin later this week.

Earlier this month, Belkin confirmed that it was developing a form of wireless HDMI utilising the 5GHz spectrum. Unfortunately, it's keeping its lips shut about any further developments until CES in January.

Manhunt 2 tweaked to beat US sales ban

2007-08-29T09:25:00.001+01:00

Ultra-violent videogame Manhunt 2 has beaten the ban and will hit store shelves in the US at Halloween, publisher Take-Two Interactive has said.

Take-Two said that the game has been altered to achieve a lower age-rating than it was previously granted in the States. The US Entertainment Software Rating Board (ESRB) has now granted the game a Mature rating, marking it as suitable for players aged 17 or more.

In June, the ESRB awarded Manhunt 2 an Adults Only rating, signalling it to be suitable only for folk aged 18 or over. The US rating system is merely a guide - there's no legal weight behind it - but many major chains refuse to sell AO-rated titles, and the games console makers forbid games with that classification being branded as compatible with their systems.

The original rating effectively blocked Take-Two's plan to release Manhunt 2 in the US on 10 July for both the Nintendo Wii, and Sony's PS2 and PSP consoles.

Earlier in June, the UK's game rating body banned Manhunt 2 by refusing to award it a rating. The British Board of Film Classification (BBFC) certification is backed by legislation: it is illegal to sell an uncertified game here, or to sell a certified title to a buyer who's too young.

Take-Two did not say whether it has re-submitted Manhunt 2 to the BBFC.

Social Networking Goes Professional!

2007-08-28T12:34:00.000+01:00

Social Networking Goes Professional --- Doctors, Salesmen, Executives Turn to New Sites to Consult, Commiserate With Peers; Weeding Out Impostors

When radiation oncologist Michael Tomblyn recently saw a 21-year-old patient whose eye was protruding from its socket, he turned to his fellow physicians for help. Dozens of doctors offered suggestions, including fungal infection, HIV-associated lymphoma or a cocaine-associated sinus problem, eventually steering him toward the correct answer: rhabdomyosarcoma, a fast-growing cancer most often observed in young children. The diagnosis didn't take place in a doctor's lounge. It happened on Sermo.com, a social-networking site for licensed physicians, which Dr. Tomblyn and 25,000 doctors like him visit regularly to consult with colleagues specializing in areas from dermatology to psychiatry.

"It is a way for us to commiserate and know we are still talking to others like us," says 36-year-old Dr. Tomblyn, who works for the University of Minnesota Medical Center.

Social networking, popularized by teens sharing information with their friends online on Web sites such as Facebook Inc., is now blooming in the business world, thanks to new social networks that enable professionals and executives in industries such as advertising and finance to rub virtual elbows with colleagues.

Millions of professionals already turn to broad-based networking sites like LinkedIn to swap job details and contact information, often for recruiting purposes. Business executives also have turned to online forums, email lists and message boards to sound off on information related to their industries.

Now, online services are trying to promote a more personal type of business networking. Unlike relatively simple message boards that are open to all, these new sites -- including Sermo.com for doctors and INmobile.org for the wireless industry -- have features such as profile pages showing professional credentials; personal blogs that function like a kind of online diary; links to "friends" online; electronic invitations to real or online events; and instant-messaging.

Social networking is just one of many consumer technologies, including blogs, wikis and virtual worlds, to cross over into the corporate world. It is happening as social networking is moving more into the mainstream. Leading consumer social-networking sites attracted more than 110 million unique monthly U.S. visitors in July, up more than 40% from the previous July, according to comScore Inc.

For a variety of reasons, social networking has been slower to take off in the business world. Employees are wary of disclosing too much to potential competitors, and loose-lipped executives can easily embarrass themselves and their companies online. Policing these services' memberships to weed out impostors can be difficult, and the sites are still in the early stages of turning their networks into sustainable businesses. Also, business users typically have less time to devote to socializing online and are willing to do so only if they believe they are getting a unique benefit from the site.

"Professionals are fairly protective about their social networks which they spend their whole lives to build," says Mikolaj Jan Piskorski, assistant professor of business administration at Harvard Business School. He adds that the appeal of social networking is limited largely to industries where workers are fairly isolated from their colleagues on a day-to-day basis, like medicine, construction and sales.

Many of the new services are free to members. Revenue comes from advertising or charging outside businesses access to data and member discussions. For example, Sermo Inc. of Cambridge, Mass., generally charges $100,000 to $150,000 a year to nonmedical businesses like hedge funds, which use it to research such things as how doctors feel about new drugs. They can monitor online discussions, with the doctors' names omitted, or see a tally of topics being discussed on the site -- like a new medical device or a controversial cancer treatment -- to determine what's rising or falling in popularity.

The site, founded by Daniel Palestrant while he was a surgical resident in Boston and launched last year, discloses its business model to users when they register. Members say they don't mind that their conversations are accessible to others, particularly since their identities are concealed. In this, Sermo is different from many other sites. Doctors are generally more interested in getting treatment advice and access to other doctors' experiences than in networking for new business partners. As a result, the site doesn't require users to use their real names, although Sermo itself verifies and holds the identities of everyone who registers.

INmobile.org -- a social network for the wireless industry launched last year by Adam Zawel, former director of the Yankee Group's Wireless US Research Program and the executive search firm IdealWave Solutions, based in Harvard, Mass. -- has a different business model. Its basic services are free to its members, about 730 high-level executives at cellphone makers, wireless operators and media companies. But members can choose to pay $2,000 a year to list promotions and ads in a special "marketplace" section.

Some of the new sites simply charge a membership fee. This fall, for example, Reuters Group PLC is planning to launch a new social-networking service, tentatively named "Reuters Space," for fund managers, traders and analysts. For a fee, which hasn't yet been set, they will be able to log on to create profiles with industry-relevant information like their "asset class" and "instruments," check financial news feeds and ruminate about the industry on personal blogs. However, the Reuters service will only allow employees to join if their companies are Reuters customers. It also plans to allow companies to block certain features like blogging and to archive employees' online activities for compliance purposes.

Online networking services are trying to broaden their appeal with new ways of making sure their members are who they say they are. For example, Sermo authenticates each of its members by checking their credentials against several of the 10,000 databases they have access to. The service also requires users to answer three verifiable personal questions, ranging from their phone number to where they got their medical degrees before they can sign up.

INmobile.org relies on member referrals and email confirmations, but says it is looking into stricter methods, like calling up the person or their colleagues, since emails can be easily faked. The service says it turns away more than half who apply, admitting only director-level employees and above from large companies, top-level executives from smaller companies and vice-president level and above from midsize businesses.

Even after these measures, it can be difficult getting business people to converse freely with each other online. Alexander Pigeon, vice president of international for MLB Advanced Media LP, the interactive media and Internet arm of Major League Baseball, is guarded about what he shares on INmobile.org, which he recently joined to stay on top of big trends in wireless. "I certainly wouldn't post something about my company that wasn't publicly released," says Mr. Pigeon, who instead sticks with "pontifications" on broad trends like the future of mobile music.

But taking a risk on an advertising social-network paid off for Angela Glenn of Long Beach, Calif. The 40-year-old graphic designer first joined a free social network created by the blog AdRants as a "lurker," reading but not contributing to the site. Before long, she gained the confidence to debate topics like Web-site design, and she and one sparring partner grew so fond of each other's styles that they eventually started an ad agency together, the GASP Company LLC. "You get to hear potential partners out and see how they think about things," she says. "It's the closest thing you get to a personal recommendation."

Acer Buys Gateway, Bulks Up for Global Fight

2007-08-28T12:30:00.000+01:00

The banding together of Taiwan-based personal-computer maker Acer Inc. and Gateway Inc. of the U.S. underlines how crucial scale is in the consolidating global personal-computer market, where margins are thin and competition is increasing. Acer's latest push into the U.S. also marks a new stage in one of the PC industry's biggest turnaround stories.

Acer yesterday announced its $710 million acquisition of Irvine, Calif.-based Gateway, vaulting the combined company into the No. 3 spot in global PC-market share by unit shipments. The new Acer would supplant China's Lenovo Group Ltd., which rose to the third spot in the industry two years ago by purchasing the PC operations of International Business Machines Corp.

"Scale is important and will become even more important in the future," Gianfranco Lanci, president of Acer, said in an interview. He added that for the time being, he planned to consolidate Gateway's supply chain into Acer's to gain efficiencies but keep Gateway running as a separate company.

"This transaction provides the scale to compete in today's global market," Acer Chairman J.T. Wang said on a conference call.

PC companies have their components built by suppliers that discount their prices based on the size of an order. Now, Hewlett-Packard Co. and Dell Inc., which together accounted for more than 52% of the U.S. PC market in 2006, can put in the biggest orders and get the biggest discounts. They then often use such discounts to underprice their competition, which helps maintain or increase their share. The vicious cycle makes it nearly impossible for smaller PC players to compete profitably.

While Gateway and Acer were respectably sized, their market shares were tiny compared with H-P and Dell. Together, however, the combined company would have had revenue of more than $15 billion for 2006, and it expects to ship about 25 million PCs this year, executives said. Acer executives said they will continue to use the Gateway and eMachine brand names after the acquisition.

Mr. Wang acknowledged the multibrand move is a "major change in corporate strategy" for single-brand Acer, but he said it would be a strength to have three brands as it would enable the company to better target different segments of the consumer market. Mr. Lanci added, "The other good reason is that the Gateway brand is a very well-recognized brand in the U.S., and we want to continue to leverage on the brand in the U.S. and to expand [it] outside the U.S., because we see opportunity in some emerging countries in Asia."

Acer executives said they expect the union to save the combined company about $150 million next year, by giving it better purchasing power for components and by cost cuts through combining parts of overlapping operations like customer services. Gateway is in talks to sell its unit that sells PCs to education, government and businesses, the company has said.

Under the terms of the deal, Acer will launch a cash tender offer for all outstanding shares of Gateway for $1.90 a share, a 57% premium to the closing price of Gateway's shares on the New York Stock Exchange on Friday. Yesterday, Gateway's shares rose 61 cents to $1.82. The companies said the deal was approved unanimously by the boards of both companies and is expected to close by December.

Acer has been plotting an acquisition for about a year. Mr. Wang first disclosed the company's intention to do a deal in March, though he didn't specify any possible targets. Monday he said Acer and Gateway have been in contact for some time but that serious discussions about the deal began about six weeks ago.

Gateway decided to sell itself when its board determined that a combined Acer-Gateway would benefit from greater scale and efficiencies, making it more competitive, said a person familiar with the matter. The once highflying PC maker, known for boxes with a cow-hide print, referring to the company's 1985 founding by Ted Waitt in an Iowa farmhouse, had in recent years been buffeted by stiff competition and declining sales. Its purchase once again narrows the ranks of U.S. PC manufacturers, which once included powerhouses such as Compaq Computer Corp. Nevertheless, the U.S. still has the world's two biggest makers, Hewlett-Packard and Dell.

For Acer, a company that once made PCs for big-name Western brands and is now buying one, the purchase marks a major -- though potentially risky -- step. Owning Gateway, which has roughly 1,645 employees, will dramatically increase Acer's foothold in the U.S., a market long dominated by Dell and H-P but where Acer has been making some headway selling its laptop PCs through big retail chains like Best Buy Co.

That's a contrast to the mid-1990s, when Acer tried to grab market share in the U.S. before effectively retreating in 1999. Later, Acer's chairman, Mr. Wang, jokingly called the U.S. the company's "land of sorrow." Acer has since recovered and successfully pushed into Europe, where it is a dominant seller.

But while a combined Acer and Gateway would hold about a 10.8% share of the U.S. PC market, it still remains far smaller than H-P and Dell. In the second quarter of this year, H-P had a 23.6% share of the U.S. PC market, while Dell had 28.4%. Overall, a combined Acer and Gateway would have about 9% of the global PC market, compared with H-P's 19.2% and Dell's 16.1%, according to IDC.

If the deal goes through, managing three different brands could increase the complexity of Acer's operations. Retailers may want to condense the shelf space they allot to the brands, for example, now that they're all owned by one company.

The new tie-up could also strike a blow to China's Lenovo, which in 2005 acquired IBM's PC business and this year has been battling with Acer for the industry's No. 3 spot.

Earlier this month, Lenovo disclosed that it was in talks to buy a stake in Packard Bell BV, a Netherlands-based PC maker. But in a separate statement issued yesterday, Gateway appeared to throw cold water on those talks, saying it intends to exercise a "right of first refusal" to acquire all the shares in Packard Bell's parent company, PB Holding Co. Gateway said it had acquired that right in June 2006 from John Hui, the Chinese-American businessman who owns Packard Bell.

Gateway said it had recently received a notice from Mr. Hui offering to sell all the shares of Packard Bell's parent to Gateway. It's unclear what the price would be.

Lenovo says it remains interested in acquiring Packard Bell. A Packard Bell spokesperson didn't immediately respond to requests for comment.

Many analysts said they weren't surprised Gateway is being acquired. The PC maker hit its peak in the late 1990s with its quirky cow logo and Gateway Country retail stores. However, it suffered when competitors such as Dell priced their wares more cheaply. In 2002, Gateway expanded into consumer electronics such as flat-screen TVs, but the efforts didn't bolster its sagging PC business. By 2004, it had closed its stores and refocused on PCs. Its stock price, which once hit $82.50, has fallen around 98% to its current level.

It's unclear who will manage the Gateway business and what happens to current Chief Executive Ed Coleman, says a person familiar with the matter.

Sky makes up for share price drop

2007-08-28T12:26:00.000+01:00

THE satellite broadcaster BSkyB has made a discretionary payment totalling more than £100,000 to tens of senior managers after an administrative delay left them with a reduced bonus. The managers had asked the company to sell shares that vested in their Long Term Incentive Plan (L-Tip).

However, by the time Sky had processed their request, the company's shares had fallen in the recent stock market rout, leaving them with a lower award than they expected.

They were doubly aggrieved because Sky made a cash payment to chief executive James Murdoch in lieu of his L-Tip shares at a higher share price than the managers received.

On August 13, both Mr Murdoch and the managers received shares accruing from the group L-Tip.

The group agreed to make a cash payment to Mr Murdoch equal to the 582,750 BSkyB shares in his L-Tip scheme, netting him a near £4m bonus. The payment for Mr Murdoch's shares was made at 671.5p a share, the mid-market price on August 13.

For administrative reasons, all managers who wanted to sell their L-Tip shares were pooled together over the week, meaning they were unable to cash in their awards until August 17.

By then, however, the jitters caused by the sub-prime mortgage crisis had hit the stock market, with BSkyB shares ending the week at 655p, having traded even lower.

Sky sources said the managers had not complained, but the company had decided to make up the shortfall.

A spokesman said: "The company has decided to make a discretionary payment in respect of the difference between the actual sale price on August 17 and the closing price on August 14. This will be received by managers who chose to sell their share awards at that time.''

He denied that the company was using shareholder funds to compensate executives for falls in the market, saying: "We are not correcting the market movement, we are correcting a failure in our administrative process which disadvantaged a number of people.

"We want to treat everyone fairly and reward our people for their contribution to our success.''

The company did not seek permission from the remuneration committee to make the payment.

Jeremy Darroch, Sky's chief financial officer, also fared less well than Mr Murdoch when it came to exercising his L-Tip award. He sold 263,750 shares at only 653.42p on August 16, collecting £1.72m, while retaining 60,000 more shares.

However, as a board director, he will not receive any payment to make up the shortfall.

BT makes call for IT market

2007-08-28T12:23:00.000+01:00

Telecoms giant sets its sights on wider market after branching out of traditional space with fourth reseller acquisition.

BT has claimed there is enough space in the SME market for both the telco behemoth and its reseller base.

Following its acquisition last week of VAR Basilica (CRN Online, 20 August), BT’s fourth reseller buyout in two years, the telco admitted that the move adds IT capabilities to its portfolio putting it squarely in its channel’s path.

However, Ricky Ricketts, head of BT Indirect Sales, told CRN that its resellers already operating in the 50 to 1,000 seat market would already believe they were going head to head with BT.

“We estimate that there are 1.2m SME businesses in the UK, which is a huge community. This [buyout] does add capabilities to BT’s direct sales force, but we are reviewing a way that we can then add value to partners and possibly link in Basilica.

“We have had an IT strategy for some time and I don’t think resellers will see this as a major threat,” he said.

Ricketts said if any conflict should occur the vendor will review each case and speak to the customer.

“The end-user should choose the solution and the supplier.”

John Carter, managing director of DMSL, said: “BT bought SkyNet and TNS last year so it is targeting the mid-market. It will not do this on its own, so it is acquiring to enable it to get traction.

“With the introduction convergence there is likely to be more changes to come. BT’s route to market is firstly its web site, then BT Direct and the channel after that at the moment it is focusing on going direct to the end-users.”

“BT does not see itself as a phone company, now it wants the whole IT marketplace, and there will be other acquisitions on the horizon.”

Mark Evans, director at BT VAR ME consultancy, said: “It’s another route to market for BT. The business community won’t deal with Basilica just because it’s owned by BT

BT will have to build trust with customers and many customers already have trust with their reseller.”

Antoine Barre, EMEA vice president for Solution Partners Organisation at HP, said: “Both Basilica and BT are partners of HP and we see an opportunity with the two firms merging. Basilica can bring a lot of skills to BT and apply them to BT’s customer base.”

Tom Gutteridge, head of marketing and business development at Damovo, said: “I can understand why BT wants to make this move. Unified communications is key to our sector and BT has a skills shortage in this area. There is the expectation now that BT is operating in the IT space and end-users expect it to have solutions that include Cisco and Microsoft.”

3G's gift to humankind

2007-08-24T10:09:00.000+01:00

Net Results: Connectivity on the move used to be a luxury - if I could get an ethernet line in a hotel, or even wireless, I'd be pretty darn happy, despite the usually ridiculous charges, writes Karlin Lillington. If I couldn't, I could still get e-mail and even file stories to my editors using my mobile phone. For a long time I just used O2's XDA smartphone with its portable, folding keyboard accessory rather than carry a laptop, as I could write a story in the cut-down version of Word on the XDA, then send it by e-mail.

Then along came GSM plug-in cards for laptops, which meant you could get e-mail and internet to your laptop anywhere you could get a mobile signal. Those were nice for e-mail, but sluggish for web use, as the smallish bandwidth provided by a GSM connection was less than ideal.

In the past couple of years I'd gone back to using a laptop for travel. On the road, I would get my e-mail and surf the web sporadically, whenever I could get a free wireless connection, which usually meant in the press room at events, or in hotel lobbies.

At least that meant I could download my e-mail directly to my inbox and not have to get it through webmail - webmail is always clumsy, as it would suck all my spam into my webmail account too, making for lots of click and delete work. And I preferred to get my e-mail into my normal inbox.

But it's been a pain when I need to send an urgent e-mail or file a story and am in a hotel room late at night. In the past, either I'd have to pay a big daily fee to use the internet for all of 30 seconds to get this done, or I'd have to run down to the hotel lobby to file and check mail then run back up to bed.

Recently, a true gift to humankind has emerged: the 3G modem. I've been using one from Vodafone for a couple of months now - O2 and 3 also now offer them - and they really are the business.

The modem is about the size of a small portable mouse but much thinner, and plugs into a USB port on a PC or Mac, desktop or laptop. It weighs almost nothing and is thus highly portable - you could tuck it in a pocket. Once you install the software and enable the modem, all you do is plug it in and connect.

If the modem can get a good 3G signal, you'll get download speeds that will likely surprise - generally faster than your home broadband connection (if you have one). If there's no 3G available, it will connect over the GSM network, which is handy enough for any urgent tasks.

What I love about this gizmo is that it will connect anywhere there's a phone signal. No more searching for a wireless network, much less a free wireless network. No more running to hotel lobbies or having to wait until the next day when I'll have access to the press room to get e-mail or send files or do some online research.

The 3G modem has totally changed what I'm able to do and made my travelling work life far more efficient and simple. Now, if I am in the airport, I can get a good chunk of work done in that waiting time and get a story filed (or alternatively, pass time on the net). I can do some research on my destination or fire off some e-mails.

I also can get a connection for Skype, the voice over internet protocol (VoIP) phone service. I have a handy little USB Skype phone for my laptop and can make low cost calls or send texts. This can be a big moneysaver depending on what roaming charges apply.

3G modems are also a possible solution for anyone who cannot get home broadband. A 3G modem may also provide a better and more versatile solution for some people as your broadband can follow you wherever you and your laptop go. I know a few people who only use a 3G modem for home broadband and it works very well for them.

Some caveats: you won't always get a good 3G signal, roaming charges apply abroad, and there's a five to 10 GB monthly limit on downloads (depending on the operator) before charges apply. Operators all have different offers and pricing plans, so read the small print to find what's best for you if a 3G modem sounds like an answer to your connectivity hassles.

Google: Personalisation is the future

2007-08-24T09:46:00.000+01:00

From search to ads - and everything in between... Marissa Mayer, Google's vice president of search products and user experience, likes her iPhone and she's a big fan of social networks, especially Facebook.

During her keynote this week at the Search Engine Strategies Conference in California, Mayer demonstrated Google Maps on her iPhone and said iPhone users could also use Google's free voice-activated yellow pages service, Goog 411. You can say 'map it' and it sends you an SMS message with a link to the map, she said.

During her keynote she also talked about the parallels between Google's Gadgets and iGoogle, and Facebook, which she said is her favourite non- Google product.

She said: There is a similar vein between both programs in that they are open platforms [and thus get broader distribution]. Anyone can create a Gadget or create a Facebook app.

Such applications are a new form of advertising that's free, she added.

Mayer said she likes the way Facebook collects information about relationships between people, including when they met and how they know each other. The type of information they're building about the social graph between people is something that is intelligent and will be particularly useful in the future, she said.

For general web search, personalisation is the future, according to Mayer. Ten to 15 years from now search sites will understand more about searchers, where they are located and what their personal preferences are, she predicted.

Mayer said one of the most important data points for improving search relevance based on personalisation is the previous query, although web history and address books could also be helpful signals to the search engine.

To avert the problem of inappropriate personalised results - such as the Amazon.com suggestions based on one abnormal purchase - Google searchers can see their search history and remove particular searches to tweak the personalisation, Mayer said. Google is considering indicating to the searcher when the results are personalised or offering a way to toggle between personalised and default results, she said.

It is important that the ads are personalised too, she said. The company is looking at changing the presentation of its Universal Search page to guide users' eyes so they can see the results and the advertisements, she said. My philosophy is that the ads and the search results should match.

And when it comes to targeting, Mayer added: For me, search and ads are almost the same.

In the future, Google may incorporate blog search, scholar and other types of searches into its Universal Search results page, which today weaves together results from news, video, maps and image search. This is a pretty straightforward first attempt and we're looking at things that are much more radical, she said.

Meanwhile, mobile is taking off. This year was the first that Google noticed an increase in the use of Google mobile applications during the summer instead of a dip, she said. Usually web searches drop during the summer months as people go on vacation or spend more time outside in the nice weather. You could see people almost switching off their computers and switching on their handhelds, she said.

Usage of Google mobile apps rose 10 per cent each week for the first three weeks in June and saw a 40 per cent to 50 per cent spike almost overnight after the iPhone was launched, Mayer said in comments after the keynote.

US video game sales rise 37 percent in July

2007-08-24T09:44:00.000+01:00

U.S. sales of video games and hardware rose 37 percent in July, with Sony Corp's struggling PlayStation 3 console getting a major boost from a price cut in the month, industry data showed on Thursday. Total sales hit $925.5 million in the month, compared with $675.6 million a year earlier, spurred by strong interest in consoles from Sony, Microsoft Corp and Nintendo Co Ltd , figures from market research firm NPD showed.

Sony sold 159,000 units of the PlayStation 3, which had seen monthly sales drop to less than 100,000 units in each of the previous three months, after cutting the price by $100, to $500.

"That was exciting and very much in line with expectations, especially since we're talking about the doldrums of summer," Jack Tretton, head of Sony Computer Entertainment America, said in an interview.

It was the best month for the PS3 since January, when U.S. consumers bought 244,000 of the machines. The PS3 includes a 60-gigabyte hard drive and a Blu-ray high-definition DVD player, but its high price and dearth of must-have games have hampered sales.

"It certainly has us very optimistic, along with the software lineup we have for the fall," Tretton said. Sony also sold 222,000 units of its older PlayStation 2 console.

NPD said console sales rose more than 140 percent from a year earlier, to $286 million. Total software sales rose 11 percent on the year to $419 million.

Nintendo's Wii console held onto the top spot with sales of 425,000 units. The machine's $250 price is the lowest of any new console, and its unique motion-sensing controller has drawn buyers outside of the core gaming crowd.

Microsoft sold 170,000 of its Xbox 360 console, down 18 percent from a year earlier but better than some analysts had expected given the company's admission last month that widespread failures of the machines could cost it more than $1 billion in repairs and warranty extensions.

On the software front, "NCAA Football 08" for the Xbox 360 was the top title, selling 397,000 copies. The PS2 version of the game sold 236,000 units, while the PS3 version sold 156,000 units. The game is published by Electronic Arts Inc .

Activision Inc's "Guitar Hero" franchise also took three of the top 10 spots, with "Guitar Hero Encore: Rocks the 80s," released only on the PS2, placing second with 339,000 copies sold.

Nintendo's best game was "Wii Play," which is bundled with an extra controller and whose 278,000 units sold was good enough for second place. Nintendo's "Mario Party 8" came in fifth place while "Pokemon Diamond" for the DS handheld was seventh.

Has wireless broadband become mainstream?

2007-08-24T09:42:00.000+01:00

Penetration of mobile-only households, limited fixed broadband coverage and appropriate pricing help drive market share of wireless broadband. The success of wireless broadband is increasing the debate on how wireless is able to compete with the lower-cost, higher-bandwidth fixed services provided by fixed broadband.

Wireless broadband's success in selected markets is reflected in the market shares, which range from 6% to 21%, even where fixed broadband is readily available.

The cumulative share of net adds since launch - reflecting the market share since the launch of the service - shows an even more remarkable range of 8% to 40%, as summarised in Exhibit 1.

Exhibit 1: Market share of wireless broadband [Source: Analysys estimates, 2006 and 2007]

Analysys has identified key market factors and service proposition factors that are driving the success of wireless broadband. The key factors that enable the success of wireless broadband include:

• the presence of a large number of mobile-only households, either due to low fixed penetration in developing countries or termination of PSTN services (e.g. in Austria)

• limitations on the coverage of the fixed broadband network

• pricing for wireless broadband that is similar to, or lower than, fixed broadband services (e.g. in Austria, Singapore and Sydney).

The key challenge facing wireless broadband operators (WiMAX or HSDPA) is the choice of the appropriate technology to deploy in order to take advantage of the opportunity.

WiMAX has focused on urban areas, and this is expected to be a compelling proposition, particularly in developing markets.

• GDP per capital in urban areas tends to be significantly higher than national averages (20%–100% more), and as a result, urban areas in developing markets resemble middle-income emerging markets (e.g. Eastern Europe) rather than low-income developing economies.

• The WiMAX business case in urban areas of developing markets looks quite different to a cellular business plan in terms of cashflows.

Despite significant cash outflows in the initial years, the capex typically starts peaking in years five and six, due to increasing capacity demands rather than coverage demands. In that time frame, the business tends to be cashflow positive and therefore it is seen as less risky to make further investments.

Amrish Kacker is a principal consultant at Analysys.

Mobile TV

2007-08-24T09:40:00.000+01:00

Earlier this year, EU commissioner Viviane Reding announced that the preferred mobile TV standard will be DVB-H, leaving British users a little bit out of pocket. BT and Virgin Mobile had already started selling phones that use their Movio system, based on a competing standard called DAB, and BT has shut down further development of the project.

It will be some time before DVB-H TV is running in this country because the radio spectrum to use it hasn’t been assigned formally. But if you do want to watch broadcast TV or listen to digital radio on your mobile in the future make sure you pick a DVB-H handset.

Hutchinson hangs onto mobile group

2007-08-24T09:37:00.000+01:00

MOBILE phone group 3, a £13bn gamble for Hong Kong conglomerate Hutchison Whampoa, is finally throwing off enough cash to wash its face. But customer growth is sluggish, despite eyecatching product launches, and the number of subscribers quitting is still high.

Investors expect Hutchison, which has interests spanning some of the world's busiest ports, Canadian oil sands and beauty retailer Superdrug, to cash out in due course.

In the UK, 3 has 4.1m customers, up 3pc since December, when it launched its mobile broadband XSeries service.

But more than 1m of those users are 'inactive', meaning they have not made or received a call for three months.

Globally, 3 lost £724m in the first half. However Hutchison, headed by former plastic flower street seller Li Ka-Shing, made a £2bn profit after a £2.3bn gain from the sale of its Indian mobile phone arm to Vodafone.

UK goes a bundle for bundles

2007-08-24T09:33:00.000+01:00

40% of U.K. households take bundled telecoms services, according to Ofcom, while mobile usage overtakes fixed-line for the first time. Increased competition between telecoms service providers is forcing prices down and driving the uptake of bundled services in the U.K., according to the latest market trend report published Thursday by industry regulator Ofcom.

The watchdog said that last year consumers would have paid on average £6.51 per month less than in 2005 for a typical bundle of telecoms services.

As a result, 40% of UK households now subscribe to bundled services, an increase of a third on last year.

Ofcom also found that UK households are on average spending more time than ever, if not more money, using telecoms services.

The average daily Internet use in 2006 rose 158% to 36 minutes a day, while mobile voice usage was up 58% to on average four minutes a day.

"Driving this growing role in our lives is the widening availability of increasingly sophisticated telecoms services and a greater number of audiovisual services accessible via the Internet," said Ed Richards, CEO of Ofcom, in the report.

"Yet despite this, real household monthly spend on communications services fell for the second year running in 2006, down 1.5% to £92.65, driven by falling fixed and mobile call prices amid growing competition in the telecoms sector," he added.

Another key finding showed that more UK households are now relying solely on a mobile phone to make calls rather than a fixed-line handset.

For the first time, 93% of households have at least one mobile connection, compared to 90% with a fixed line. By the end of 2006 mobile call minutes totalled 82 billion, accounting for over a third of the total number of all call minutes, which stood at 234 billion.

Furthermore, in 2006 BT saw its share of voice volumes fall below 50% for the first time, while indirect operators increased their voice call share from 25% in 2005 to 28% in 2006.

Ofcom found that by April 2007 broadband penetration had risen to 53% of UK households, and by June average headline broadband speed stood at 4.6 megabits per second, compared to an average of 1.6 Mbps in 2005.

These increases have been helped by continued local loop unbundling, with the number of premises with access to an unbundled exchange increasing to 72% in 2006 from 45% in 2005.

Overall, Ofcom found the UK telecoms industry was worth $50 billion in 2006.

"[This] survey shows how our communications sector continues to develop at a fast pace, with consumers of all ages using a range of devices to find the services they want at lower prices," said Peter Phillips, Ofcom partner of strategy and market developments.

"Industry innovation and competition continue to deliver significant benefits to the UK economy and consumers," he added.

Euro commission informed of KC's monopoly

2007-08-24T09:28:00.000+01:00

Kingston Communications' monopoly of telephone and broadband in the city has been raised with the European Commission. Yorkshire and Humber MEP Diana Wallis has written to the Commission calling on it to investigate the company's presence in Hull.

She said: "I have had so many letters from constituents over the years about the price of broadband and there being no competition in the area.

"Circumstances have changed since the original European legislation about telecoms, with the sale of the council's shares.

"I think it's time to look at it again."

Hull customers are unable to take advantage of offers such as free broadband with an Orange mobile telephone contract.

Hull City Council severed its 105-year link with the group in May when the authority sold all of its 157m shares in the company.

The group recently re-branded as Kcom, but retains the name Kingston Communications for its domestic telecoms service.

Ms Wallis said: "We all ought to be and are very proud of the white telephone boxes.

"But we all know if you try to use another provider it's very complicated and they just won't touch the Kcom area. Clearly there's a feeling among people there could be a better solution.

"Maybe Kcom needs to look at its prices."

A spokeswoman for Kcom said: "The market is free for any other company to enter. They just choose not to."

BT loses majority share of fixed-line market

2007-08-24T09:23:00.000+01:00

Incumbent telco sees its share of the traditional fixed-line call market drop below 50 percent for the first time, although new lines of business are growing BT's share of fixed-line call volumes fell below 50 percent for the first time last year, an annual report by Ofcom has revealed.

This year's edition of The UK Communications Market, the regulator's annual survey of the nation's media consumption, shows that BT's share of the fixed-line market stood at only 48 percent in 2006, compared with 52 percent in 2005.

Taking into account mobile as well as fixed-line calls, BT's market share was only 23 percent in 2006, compared with 26 percent in 2005.

Mobile operators all saw their market share remain flat or increase from 2005 to 2006, with the big winners being virtual operators such as Virgin Mobile, who resell other networks' connectivity rather than having their own infrastructure. The virtual operators' share of the market stood at 10 percent in 2006, up from nine percent the year before.

The report also surveyed the business market, where in 2006 BT had a smaller market share of fixed-line calls at just 38 percent - a drop ofone percent from 2005.

Meanwhile, mobile data revenues in the business market increased by a hefty 60 percent between 2005 and 2006, up from 500m to 800m. Ofcom attributes the rise largely to the increasing prevalence of smartphones with PDA functionality, which are able to access emails and web services. Mobile voice revenues in the business sector also rose, up 12 percent from 4.6bn to 5.1bn.

A spokesperson for BT told ZDNet.co.uk on Thursday that the calls and lines business is increasingly less what BT's business is about. We have certainly seen a reduction in retail customers, but that's a result of competition. The spokespersonadded that BT's new lines of business - particularly in IT, content and global network services - were booming. BT's retail broadband revenue grew by 19 percent in the last quarter, while the company's internet telephony business grew by 23 percent in the same period.

During 2006, O2 overtook Vodafone for the first time as the mobile network achieving the highest revenue. O2, which is now owned by Spanish telco Telefonica, gained the largest number of subscribers in 2003 but it is only now that revenues have caught up.

There are now two mobile subscriptions in the UK for every fixed-line subscription. However, while the number of fixed-line connections continues to decline, it is now doing so at a slowing rate - possibly reflecting therequirement to have a fixed-line subscriptionin order to have a broadband connection.

Avatars will soon outnumber humans!!

2007-08-23T08:53:00.000+01:00

Gartner research indicates that in four years' time 80% of internet users will have avatars - virtual replicas of themselves - working or playing online. Given the pace of internet adoption, and the fact that people often have more than one avatar, there will soon be more avatars than humans, at least in the industrialised world.

How, if at all, this will change society is fascinating to predict. Dozens of companies are researching advanced versions of virtual worlds. And as computers get more powerful, screens bigger and slimmer, with high definition television around the corner, the prospects are endless. Admittedly, the flagship of three-dimensional worlds, Second Life (SL), has been having a bad time of it this month. It had its first big financial crash when the Ginko bank failed with debts worth $700,000 (£350,000), leaving depositors in the real world suffering the consequences. Second Life was also forced to ban gambling activities. Some commentators keep reminding us that only a small proportion of its 9 million "residents" actually come back regularly to participate. On the brighter side, next month the Royal Liverpool Philharmonic Orchestra will become the first professional classical ensemble to give a concert in Second Life, in a virtual version of the city's Philharmonic Hall.

It is true that SL's residents come and go but this is unsurprising since, unless you are actively involved in building, shopping or partying, then a space that is already eight times the size of Manhattan can be a pretty empty place to get lost in (just like the real world). It is barely a year since SL came on to the public radar yet already there is an unstoppable momentum towards building more 3D worlds that will eventually be able to interact with each other, so an avatar in one can move in and out of a rival system.

The race to build a better virtual world is already leaving the Arctic land grab in the shadows. The winner could be Google Earth, which recently added photographs of streets to its zoom-in model of the planet. It already has 250 million users who add content and interact with each other. It doesn't take a big leap of the imagination to envisage your avatar talking to friends and strangers in your own street in a few years' time. But it faces big competition from others such as Entropia Universe, the Swedish virtual world that recently signed a deal with the Beijing municipality to build a virtual universe able to handle 7 million users at any one moment. The company believes virtual worlds could lead to people working from home in a big way. Since barely 50,000 of Second Life's 9 million residents are online at any one moment, the same ratio of active to inactive users could make China's virtual space bigger than most countries in the world. The company promises "stunningly realistic graphics, environmental physics and believable animations".

Second Life, of course, isn't standing still. It regularly introduces new features, such as 3D sound (which gets louder as you get closer to people) and the benefits of opening its code to developers has yet to be felt. But it may need a fundamental system upgrade to ward off increasing competition.

Virtual worlds are a natural space for social networks such as MySpace, Bebo and Facebook to migrate to in the future since friends can meet and chat together and maybe even watch real football matches together online. The likes of Bebo don't think this will happen. Their plans are dominated by a mass migration of social networks to mobile phones. But in a few years - as mobile devices get bigger, lighter and smarter - they might be the natural hosts for such networks.

As Baroness Greenfield observed: "Offering people the chance to have a permanent soap opera going on in which they can participate will be even more pervasive than reality TV such as Big Brother."

Digital revolution could spell the end of advertising as we know it

2007-08-23T08:50:00.000+01:00

television broadcasters are facing further pressure on revenues after news that almost eight out of 10 people with a digital video recorder use it to skip through the adverts. The revelation is included in Ofcom's second annual report into electronic communications. The report collates existing studies and fresh research to supply a snapshot of a market in which consumers spent more than pounds 50bn last year.

It confirms the scale of the task facing traditional media and telecoms companies, whose customers' consumption habits are shifting rapidly with the rise of the high-speed internet and new digital devices.

Television:

In the first quarter of the year the proportion of households with a digital video recorder (DVR), which allows viewers to pause and rewind live TV, leapt from 8pc to 15pc. And 78pc of those viewers said they always or almost always use their DVR to fast-forward through commercial breaks.

''The widespread availability of DVRs will force broadcasting advertisers to look at how to create more compelling advertising that is more impervious to fast-forwarding,'' said Steve Gettings, Ofcom's senior broadcasting manager.

For advertising agencies it may be just another challenge, but increasingly cheap DVRs such as Sky's popular Sky+ box are piling the pressure on commercial broadcasters such as ITV, Channel 4 and Five. Their advertisers are already fleeing to the web to find audiences. Ofcom's study found television advertising revenue in 2006 fell by 2.2pc to GBP 3.5bn, the first fall since 2002.

Meanwhile, online advertising spending surged 47pc to break the GBP 2bn mark. That figure is equivalent to: almost half the amount spent on all TV advertising; 83pc of advertising spend on ITV1, Channel 4 and Five; and a quarter of all press advertising.

The company dominating the new space is Google, which Ofcom says grabbed almost 40pc of all UK online advertising spending with its ubiquitous search engine.

TV has tried to make up its revenue shortfall by alternative sources of income such as quiz television channels and participative voting in programmes, which increased by 18.3pc during 2006 to GBP 123m.

But Ofcom warned ''this new source of income may be affected in the future as broadcasters review their approach to interactive TV'' after a slew of premium-rate phone-in scandals.

Telecoms and broadband:

While the average time spent watching television was down 4pc last year, average daily internet use more than doubled as ever more households connected to the high-speed internet.

More than half of UK homes now have broadband and connection speeds, or at least the speeds advertised, have risen almost eight-fold over the past four years.

This massive shift has been triggered by rule changes which make it easier for BT's rivals to access its exchanges, take over the line and supply their own broadband services. But the broadband market has not proved to be the sure-fire money-spinner many such companies had hoped. Competition is fierce and prices have tumbled, thanks in great part to ''free'' broadband offers from Carphone Warehouse and BSkyB.

Ofcom's analysis of the cost of a typical basket of residential telecoms services (a fixed line, two mobiles and a broadband connection per household, all at 2006 usage levels) shows that consumers would have paid GBP 6.51 (9pc) more for the same bundle of services in 2005 than in 2006. In the five years to 2006 the cost saving on the same bundle was GBP 34.97 in real terms.

Mobile:

But as our broadband usage has increased, our reliance on the home phone line has diminished. The report shows by the end of 2006 there were more than double the number of mobile connections (69.7m) than landline connections (33.6m). An increasing number of people also have more than one device, either one for business and one for personal calls, or one they use to make cheaper calls on at different times of the week.

Not only that, but more households now rely only on a mobile phone (9pc) than rely on a landline (7pc) and for the first time, total mobile call minutes accounted for over one third of all call minutes.

According to Peter Phillips, Ofcom's partner for strategy and market developments, ''networks are offering bigger bundles of minutes, encouraging people to use their mobiles more''.

But they are not just using them for calls. Some 41pc of mobile phone users regularly use their phone as a digital camera, 10pc listen to radio broadcasts, and 21pc use it for games.

But while mobile users in the UK sent 20pc more texts than the previous year with an average of 12 text messages per mobile per week, take up of the mobile internet remains limited. Just 13pc use their mobiles for web access and less than 12pc of the population had a 3G phone by the end of last year, despite the hype surrounding the technology.

Radio:

Radio's own wonder technology, DAB, has seen the number of stations rise to 389, but the total number of radio listening hours dropped significantly.

This was felt hardest in commercial local radio, where average listening fell by 4.1pc as consumers found different things to do with their time, such as surf the internet.

In fact, since 2001 radio's slice of the UK advertising market has fallen more than 14pc, ''almost exclusively due to cannibalisation from advertisers going to the internet''.

However, James Thickett, Ofcom's director of research, pointed to recent evidence that commercial radio has increased its share of listening against the BBC. ''One shouldn't jump to conclusions of a catastrophic decline in radio,'' he said.

Nevertheless, the BBC still has over half of all radio audiences and is investing for the future. Helped by an increased licence fee, the Corporation is spending more on radio than at any level in five years. Meanwhile, commercial radio's investment is at its lowest since 2002.

Social-Network Sites Are Asked to Impose Tighter Age Controls

2007-08-23T08:49:00.000+01:00

The attorneys general of all 50 states have joined forces to pressure MySpace, Facebook Inc. and other Internet social-networking sites to put in place greater parental controls and age-verification tools so minors can't access the sites so easily. Led by Richard Blumenthal and Roy Cooper, the attorneys general of Connecticut and North Carolina, respectively, the group is working together to pressure the social-networking sites for changes and push for new laws.

In recently ended sessions, legislation was introduced in Connecticut and North Carolina that would have placed stricter controls on the operators of networking Web sites. In both cases the bills were unsuccessful, but the attorneys general and lawmakers have pledged to try again. Georgia and other states are considering similar action.

"These sites say they want to cooperate, but they have resisted the concept of age or identity verification," Mr. Blumenthal said.

In Washington, Rep. Melissa Bean (D., Ill.) and Sen. Ted Stevens (R., Alaska) have introduced bills to address the issue and raise awareness.

Ms. Bean's bill would earmark money for the Federal Trade Commission to embark on a public-awareness campaign to alert parents to the potential dangers of children's accessing the sites. Sen. Stevens's effort would require schools to educate children about the potential risk of the social-networking sites, and launch a similar public-awareness campaign.

Popularity of social-networking sites has exploded over recent years. MySpace has around 115 million users and Facebook more than 35 million. Subscribers use the sites to contact friends and to keep acquaintances around the world up-to-date on developments in their lives. Even politicians are realizing their potential, with several of the 2008 presidential candidates establishing presences on the sites to reach out to supporters and donors.

The sites are also used by sexual predators, who pretend to be minors in order to groom victims. In July, a Connecticut man, David Leonard, was convicted and sentenced to 20 years in prison for having sexual contact with underage girls he met on MySpace. The majority of the users of both sites are young -- the average age of Facebook members is 21.

MySpace, owned by News Corp., acknowledged recently that it had detected some 29,000 registered sex offenders on its site, and that was only those who signed up using their real names. ( News Corp. has agreed to acquire Dow Jones & Co., publisher of The Wall Street Journal.)

Facebook says it has found some offenders and immediately removed their privileges, but wouldn't say how many.

Beyond such steps, though, the companies argue that effective age-verification tools for minors don't yet exist and point out they have controls in place to empower parents and protect children. They also say that requiring parents to verify the ages of their children wouldn't work, because there isn't any way to determine the individual is in fact the parent.

Chris Kelly, chief privacy officer of Facebook, which is based in Palo Alto, Calif., said the site requires new users to have a valid email address in order to confirm their registration, which he said is one safeguard to prevent children under the age of 14 from joining.

Members of online groups of friends that are based around a high school lose access once they turn 19. And, in other groups of friends, such as those living in the same city -- the most popular kind on Facebook -- members over 18 are prevented from seeing the full profiles of those who are under that age. New members also must be invited in by existing members.

"The fact is the average user on Facebook has access to significantly less than half of 1% of the profiles on our network," Mr. Kelly said.

MySpace doesn't allow children who are under 14 on its site, and regularly trawls its membership lists to search for inconsistencies that would indicate that a member is under that age. But new members aren't required to give their ages when they sign up.

Google says mobile usage has surged this summer

2007-08-23T08:47:00.000+01:00

Google Inc has seen a spike in usage of its mobile services since May, partly offsetting the traditional summer slump in computer-based Web surfing for the first time, an executive said on Wednesday. "We are seeing more and more mobile activity," Marissa Mayer, Google's vice president of search products, told a Web marketing conference in Silicon Valley.

Traffic to Google's maps, e-mail and mobile searches on mobile phones and wireless handheld devices rose 35 percent between May and June. That reversed the previous annual pattern in which both mobile phone and computer use declined, the Google official said.

The much anticipated U.S. launch of Apple Inc's iPhone Internet phone in late June led to a jump of 40 percent to 50 percent in use of Google Maps on mobile phones, according to Mayer, Google's vice president of search.

Google Maps is one of the handful of featured applications on the iPhone.

Mobile use remained high into August, even as overall traffic searches surged then fell in the summer months. The traffic traditionally drops by 20 percent to 40 percent between May and June, as computer users in the Northern Hemisphere go on vacation.

"I think this is sort of a sign that people are becoming savvier with their mobile devices, and that there are better devices" available for the Web, while away from computers, Mayer told reporters after a presentation to marketers at the Search Engine Strategies Conference in San Jose.

"The technology curve is catching up," she told reporters after the presentation. "The phones are just better."

While the numbers of mobile users of Google search services remain tiny compared to the hundreds of millions of computer users of Google, the higher traffic reflects the growing acceptance of the mobile Internet, Mayer said.

While there are tens of millions of mobile searches on Google each day, they are a far cry from the billions of daily Google service requests done via computer.

So far, Google services are mainly designed for use on higher-priced "smart phones" that have faster browsers and bigger screens than typical mass-market mobile phones that are commonly used for voice-calling and text-messaging.

Mayer said internal traffic data appears to show a growing number of users switching off their computer and signing on to Google services via their mobile phones.

Google's mobile traffic still comes largely from U.S. users, reflecting the wider number of services available in the company's home market, including Google Maps, which offers detailed real-time traffic maps in more than 30 U.S. cities.

Japan and Europe are also seeing growing demand for Google services such as Gmail and mobile search, Mayer said.

Overall growth in the usage of Google services has begun to pick up again in the current week, as U.S. students go back to school and vacationers begin to return to work. (Editing by Jeffrey Benkoe)

Use of video and computer games declines among children

2007-08-23T08:46:00.000+01:00

Children's much-touted media multi-tasking has its limits, according to a study by Ofcom, the media and communications regulator. It found that children's rising use of the internet, mobile phones and iPods had led to sharp declines in their use of DVDs, the radio and even video games consoles. Just 38 per cent of the eight to 15-year-olds polled by Ofcom in April and May this year said they watched videos or DVDs regularly, down from 59 per cent two years ago. Use of computer games has also declined, from 61 per cent to 53 per cent, and now peaks among 11-year-olds before trailing off.

Radio, which has not been a major medium for the under-15s, has become more marginal, with just 20 per cent saying they listened regularly, half the rate of two years ago and a third of those saying they do so because 'it is just on in the background'.

The media and communications regulator, which described the study as the first wave of an ongoing research project looking at the consumption of five to 15-year-olds, found over 20 per cent of five-year-olds used mobile phones, rising to 85 per cent of 11-year-olds.

Almost 40 per cent of five-year-olds use internet-enabled computers at home, rising to almost 80 per cent of 15-year-olds. The biggest growth was in use of digital music devices such as Apple's iPod, now used by 61 per cent of eight to 15-year- olds, up from 26 per cent.

Half of all children between 12 and 15, are using the internet to download media content, with music videos more popular than user-generated content, film and TV clips or full-length TV programmes. The study confirmed that multi-tasking is alive and well, with almost 60 per cent of five to 15-year-olds saying they did other things while watching television. The mobile phone was the most popular distraction, with 30 per cent using their handsets in front of the TV, compared with 22 per cent using the internet.

They are more likely to be texting than talking, with 82 per cent saying they used their mobiles for messages compared with 65 per cent for calls.

While around half of eight to 15-year-olds use their handsets to take photos, play games or listen to music, 5 per cent or less use them for internet access or watching videos. The mobile feature most likely to displace stand-alone devices, however, is not the digital camera but the alarm clock.

Ofcom's analysis of the demographics of new media use also found that the stereotype of the spotty male user no longer holds true. Although older and younger users are still more likely to be male, women aged between 25 and 49 now spend more time online than their male peers for the first time.

The over-65s are a third as likely to be online as the broader population, but 'silver surfers' spend a disproportionate amount of time online, at 42 hours a month, half as much again as the total internet audience.

Ofcom found that the over-50s now account for a quarter of all internet users, and over 30 per cent of all the time spent online.

The study is likely to be read closely by advertisers eager to reach specific audiences such as young men who are turning their backs on magazines and other traditional media and older consumers with high disposable incomes.

It contained little consolation for commercial radio operators, who earlier this week had seized on reports showing they had clawed back some listeners from the BBC.

The radio audience is ageing, according to Ofcom's data, with a 17.3 per cent decline in the number of 25 to 34-year-olds listening.

BT, Sony unveil PlayStation with video calling

2007-08-23T08:45:00.001+01:00

Britain's BT Group Plc and Japan's Sony Corp have unveiled new software that will allow millions of gamers using portable PlayStations to make video and voice calls and send instant messaging. Britain's top fixed-line carrier and the Japanese electronics and media group said on Wendesday the Go!Messenger wireless software for Sony's PlayStation Portable (PSP) handheld game player was set for commercial launch in January 2008. In a battle for supremacy against Japanese rival Nintendo's hot-selling DS rival game player, Sony and BT said the software allowed PSP gamers to keep in touch by connecting to any broadband wireless Internet point at home or out and about using VoIP (voice over Internet Protocol) Internet telephony.

"By offering a variety of communications options to help stay in touch with other gamers, Go!Messenger truly brings the entertaimnent potential of PSP to life," said Steve Andrews, head of mobility and convergence at BT.

As Sony's lead wireless partner, BT said it would initially promote the software, which was developed in its research centre, in the UK, France, Germany, Spain and Italy before extending its reach to over 100 countries across Europe, Middle East and Africa.

It also plans to allow regional wireless Internet providers and manufacturers to buy the service wholesale and sell it on under other brands.

BT and Sony, which has shipped 24 million PSPs globally since launching the device in December 2004, signed a four-year deal in May.

BT is battling to transform itself from a hardware-based fixed-line telecoms provider into a software-based supplier of telecoms and entertainment applications.

It has invested around 10 billion pounds ($19.83 billion) into its so-called 21 Century Network telecoms infrastructure, which provides quality voice and video calls at cheaper costs over the Internet.

Mobile spending falls for first time

2007-08-23T08:42:00.000+01:00

Household spending on mobile phones fell for the first time last year even as consumers' dependence on them grew, according to an Ofcom report released today. The 2 per cent fall, to £31.72 per month, was attributed by the media regulator to price cutting by telecoms companies as competition grew more fierce.

The figures emerged in a review of the UK's fast-changing £50bn media and communications landscape, which also highlighted the extent to which the rise of the internet is affecting radio and television audiences and advertising.

Ofcom's annual survey found that 35 per cent of all calls last year were made over mobile phones, up from 30.7 per cent a year earlier. Mobiles accounted for about 82bn of the 234bn minutes consumers and businesses spent making calls, up from 71bn out of 231bn minutes a year earlier.

Peter Phillips, Ofcom partner for strategy and market developments, said competition in fixed and mobile telecoms pricing had been the main driver behind a 1.5 per cent fall in the average amount households spent on media and communications services a month, to GBP 92.65.

The fall in spending on mobiles came despite a 6.4 per cent rise in the number of mobile connections, with many individuals now using more than one mobile device to distinguish between work and personal calls or to take advantage of different cheap tariffs, Mr Phillips said.

The conditions may finally be in place for the long-awaited take-off of mobile internet use, Ofcom added. Penetration of 3G mobile phones increased from 7 per cent to 11.2 per cent last year, with rivals such as Orange, T-Mobile, O2

More households now rely only on mobile phones than on landlines alone, butthe decline in the numberof fixed-line connections slowed as companies such as British Sky Broadcasting, Carphone Warehouse and Virgin Media promoted bundles of landline, broadband and pay-TV services.

Take-up of such bundles shot up in the year to 40 per cent in the first quarter of 2007 from 29 per cent a year earlier, Mr Phillips said, as headline broadband speeds increased from 1.6MB per second in 2005 to 4.6 MB per second.

The below-inflation 1.3 per cent increase in total telecoms revenues was mirrored by a 1.4 per cent rise in television companies' revenues. For the third year, subscription revenues exceeded advertising revenues, but the 30 per cent jump in uptake of the Freeview digital terrestrial service slowed the growth in pay-TV.

James Thickett, Ofcom's director of research, said a 47 per cent jump in internet advertising last year had 'squeezed' both television and radio broadcasters. The GBP 2bn spent on advertising online exceeded the combined advertising revenues of ITV1 and Channel 4, the two largest analogue channels, he said.

Google, the US search engine, accounted for about £800m of the UK internet advertising spend, Ofcom estimated, well above the £512m spent on radio advertising, which was down 3.4 per cent year on year.

Ofcom's report highlighted a further reduction in the hours spent listening to radio last year, but noted that the decline had happened in local BBC and commercial stations rather than those with national reach.

Stations including Radio 1, Radio 4 and Classic FM had expanded their weekly reach by the first quarter of 2007, while Radio 3, Capital Radio and Virgin Radio declined.

Ofcom also released figures showing that 15 per cent of all households used digital video recorders such as BSkyB's Sky+ device by the first quarter of this year, almost double the average for the whole of 2006.

Of those, 78 per cent claim to use the technology to skip advertising breaks, a higher proportion than some surveys had estimated. Mr Phillips said the numbers should be treated with some caution, as respondents tended to claim they skipped ads more than they actually did, but the findings may concern television advertisers.

More women, people over 65 go online in UK - Ofcom

2007-08-23T08:41:00.000+01:00

Britons are changing their media habits as more women and people over 65 go online and as more consumers opt for a single provider for their Internet, entertainment and phone services, an industry report says. Among the changing trends in 2006, children are cutting back from using computer games to spend time on mobile phones and the Internet, British media regulator Ofcom said in its annual report.

As technologies, platforms and devices have come together due to increased broadband penetration, more people are making phone calls over the Internet, listening to radio via television and watching TV over mobile phones.

In response, advertisers diverted more money to the Internet and away from traditional sources, Ofcom said.

"Our communications sector continues to develop at a fast pace, with consumers of all ages using a range of devices to find the services they want," said Peter Phillips, Ofcom partner of strategy and market developments.

Average daily Internet use was 36 minutes in 2006, up 158 percent on 2002, while time spent on the mobile phone also increased, up 58 percent at almost 4 minutes per day.

On the down side, time spent watching TV fell 4 percent during that period, although it still dominated with average daily viewing at 3 hours and 36 minutes.

Listening to radio was down 2 percent at 2 hours and 50 minutes, and time spent on a fixed-line phone was down 8 percent at 7 minutes.

As a result, TV advertising spend fell 4.7 percent in 2006 from 2005, coinciding with the spread of video content available online and the growth of digital video recorders, which can skip adverts.

Radio advertising spend fell 7.8 percent in the same period, while Internet advertising spend rose 47 percent.

In other changes, more people over the age of 65 used the Internet, spending an average of 42 hours online every month, more than any other age category, while one quarter of all British Internet users are over the age of 50.

The Web also attracted more women, with those aged 25 to 34 spending more time on the Internet than men of that age.

Some 20 percent of respondents to a survey said they made phone calls over the Internet offered by so-called VoIP (voice over Internet protocol) providers, while headline Internet speeds increased. By April 2007, 53 percent of households had a broadband connection.

The growth of broadband penetration has been driven in part by groups such as satellite operator BSkyB and Virgin Media , which offer broadband as part of their packages.

The number of consumers taking services in bundles rose to 40 percent of the population by April 2007, up by a third over the 12 months.

BSkyB extends deadline for offer

2007-08-23T08:40:00.000+01:00

Media Broadcasting giant BSkyB has extended the deadline for acceptances of its £125 million offer for set-top box maker Amstrad by two weeks after receiving support from 85.9 per cent of shareholders, just shy of the 90 per cent needed. The offer remains open until September 4.

BT pumps millions into customer service system

2007-08-23T08:38:00.000+01:00

Right here, RightNow... BT is to roll out an upgraded system for its online customer service after signing a multimillion dollar contract with CRM software company, RightNow.

The five year deal will see RightNow provide BT with a knowledge management system for 10,000 contact centre staff, to use when dealing with customer queries.

It will also include a system to respond to email queries more quickly and a live IM-style service for customers to have queries answered by support staff.

Information on the database can be updated in response to the kinds of questions being submitted and the answers that are given.

David Thomson, senior business director at BT Retail, said the technology means the company can offer a superb customer experience and keeps it ahead of the competition.

Thomson said: The technology point is important in its own right but really the reason we're doing this is that it improves customer service for our end users.

Among the benefits of the new system will be giving call centre staff better access to customer and product information when answering queries.

The system will also improve call handling times - as information will be easier to locate - as well as increasing the rate of call queries resolved on the first call and improving customer self-help on the group's websites.

Previously, the email management and knowledge database were managed by two separate companies. RightNow provided the latter but will now take on the email management side as well.

Thomson said: Really we want to bring [the two elements] together.

He added the bulk of the knowledge base is already in place and the migration of the email systems over to RightNow is due to be completed by the new year.

Young Money: A New Generation Reinvents Philanthropy

2007-08-22T10:13:00.000+01:00

Young Money: A New Generation Reinvents Philanthropy --- Blogs, Social-Networking Sites Give 20-Somethings a Means To Push, Fund Favorite Causes

Joe Alamo didn't set out to become a do-gooder. But late last year, when the Geneva, N.Y., Web designer was surfing on MySpace, he chanced onto the profile of Kiva.org, a nonprofit that allows people to make zero-interest "microfinance" loans over the Internet to needy entrepreneurs in developing countries.

Soon after, Mr. Alamo not only became a lender through Kiva, but he also started a new Web site, Kivafriends.org, devoted to Kiva enthusiasts. He also now volunteers to run Kiva's MySpace page. "This is the first time I've ever gotten so involved with a charity," says Mr. Alamo, now 30 years old.

Young donors and volunteers, snubbing traditional appeals such as direct mail and phone calls, are satisfying their philanthropic urges on the Internet. They're increasingly turning to blogs and social-networking Web sites, such as MySpace and Facebook, to spread the word about -- and raise funds for -- their favorite nonprofits and causes. They're sending Web-based fund-raising pitches to their friends and families, encouraging them, in turn, to forward the appeals to their own contacts.

At the same time, a growing number of charities -- ranging from start-ups to established names such as the Salvation Army -- are launching profiles on popular social-networking sites, hoping that young people will link up to the pages. Some are also encouraging bloggers to mention the causes on their sites, raising thousands of dollars in small donations from readers.

Many of the nonprofits that have embraced social networking are themselves run by people in their 20s and 30s, who already spend a good portion of their lives online. Some of them also appeal to donors by offering them tangible results of their gifts by directly linking contributors with recipients.

Social-networking sites, for their part, are offering new tools to help attract nonprofits and contributors. In May, a social-action start-up called Project Agape launched a new program on Facebook called "Causes," in which users can create online communities to advocate for various issues, charities and political candidates. Since then, the program has attracted more than 2.5 million Facebook users, raising some $300,000 for nonprofits and politicians, says Joe Green, 24, the project's co-founder.

That move comes after MySpace -- which already hosts thousands of nonprofits' profiles -- launched its "Impact" awards late last year, honoring individuals and nonprofit groups that have successfully used the site to make a difference. MySpace members vote on the winners, who get $10,000.

Visitors to another social-networking site, Change.org, which also launched in May, can join "virtual foundations" of peers dedicated to specific causes, such as fighting AIDS in Africa, and raise money for the charities or political candidates that support those issues. So far, its 30,000 members have raised nearly $50,000, says founder Ben Rattray, 27. Before launching the site, Mr. Rattray had never made a charitable donation, finding charities' traditional pitches to be "unengaging."

Some young philanthropists are turning to "viral fund raising" -- sending appeals to their network of contacts that are forwarded on to others -- to maximize the power of small donations. Users of SixDegrees.org, a program launched by nonprofit site Network for Good, can create a "charity badge" listing their favorite cause and send it out to their acquaintances. The badge keeps a running tally of how much has been raised and how many donors have contributed. Since the program was launched in January, users have created some 6,000 charity badges, raising some $740,000.

"When you're young and starting out, it's very difficult to take this meager paycheck you have and donate part of it to something else," says Samantha Millman, 26, of Los Angeles, who works for a real-estate investment firm.

Several months ago, Ms. Millman created a badge on behalf of Bet Tzedek -- the House of Justice, a legal-aid program in Los Angeles. "I basically blasted everyone I knew," says Ms. Millman, raising more than $15,000 from 406 donors. "I was not only surprised by the dollar amount, but to have 400 people somehow hearing about this through word of mouth was phenomenal," she says, adding that many of the donations were for just $10.

Bloggers are also pounding the drums for their favorite causes. Sarah D. Bunting, 34, who writes Tomato Nation, a culture and humor blog, offered to shave her head if her readers donated $30,000 to DonorsChoose.org, a charity that allows contributors to directly purchase school supplies for needy classrooms. The funds were raised within days. (For a video of Ms. Bunting's head being shorn last year, go to http://www.tinyurl.com/32svqs .) DonorsChoose.org now features a "Blogger Challenge" on its site where bloggers compete to raise money among their readers.

Established charities, to be sure, have long had programs targeted to young donors, and many of them, especially health-related causes, have used peer-to-peer fund raising to help raise money, often in connection with races and other sporting events. But many of these charities either tend to target wealthier donors or are focused on occasional events, rather than on ongoing operations.

Some of the newer Web-based nonprofits, such as DonorsChoose and Kiva, are attractive because contributors say they allow them to connect directly with their recipients. Donors or lenders can hand over money directly to, respectively, teachers and students in urban public schools or individual entrepreneurs in developing countries, rather than sending a check that ends up with an abstract recipient.

"You can donate money to a charity, but it seems like it just goes into a pile and you never know what really goes on there," says Mr. Alamo, the Kiva lender. "With Kiva, you just pick someone out and lend to them directly and watch what they do and how they succeed. That was the main appeal."

Kiva, which started in the fall of 2005, has already drawn more than 89,600 lenders who have lent $10 million. Mr. Alamo's Kivafriends.org Web site has attracted about 600 members since it was launched in March.

Some older charities are grappling with how to best take advantage of social-networking sites. The Salvation Army, for instance, has had a MySpace profile for "Red Kettle," its online persona, since last year. But the site has only roughly 80 online "friends," or people who have linked to it. (By contrast, Kiva has some 7,000 online friends on MySpace.)

Melissa Temme, 28 years old, a Salvation Army spokeswoman who came up with the MySpace page, says that in order to be successful on social-networking sites, charities need to spend a lot of time updating content and communicating with members, which can be difficult for a stretched nonprofit staff. "There has to be a certain level of interaction with other people and their pages," she says.

In order to keep its online postings up-to-date, DoSomething.org, which seeks to get young people involved in social action, enlisted an Ohio University college student. "We're trying to use social networking as much as possible," says Aria Finger, 24, DoSomething's business development director. "We want to reach young people where they already are." The charity boasts roughly 5,500 MySpace friends and more than 2,200 on Facebook.

Who pays your broadband bill?

2007-08-22T09:51:00.000+01:00

Quocirca's Straight Talking: Maybe your boss should... As more people work from home, more employers are paying for home broadband service. But, asks Quocirca's Rob Bamforth, how wise is this?

At one time computers and networks were found only in certain workplaces, were often selected and managed by specialists - the high priests of IT - and were certainly far in advance of anything even geeky hobbyists would have experienced at home.

Now not only have computers evolved from techie gear into mainstream affordable consumer electronics, domestic communications networks have changed as predicted in the 1990s from plain old telephone systems (Pots) to pretty awesome new stuff (Pans).

For consumers, Pans means mobile connectivity wherever they go and high speed broadband - all at a relatively affordable price. I say relatively because the typical home with two mobile phones, broadband and a fixed phone calling plan could easily be spending 100 per month on connectivity.

So is there a problem with individuals spending their own money on communications needs for work too?

Depending on their job role, many employees will find their employer provides them with some form of mobile device - phone and/or laptop - and some connectivity plan.

The once-simple proposition of providing a mobile phone on a corporate tariff is now more complex as individuals have their own preferences, styles and usage requirements. The business-supplied mobile phone has also at times necessitated a more intricate sharing of beans counted between employee, employer and taxman as the line between personal and work use blurs.

Remote access to IT increases this complexity. While remote working once might have involved a hotel network connection for a road warrior's laptop, it is now far more likely to encompass other locations, in particular the home.

This further blurs the divide between personal and business use, especially if an employee is regularly expected to work in these locations, while still remaining in a technical environment controlled and secured by the IT department. The remote employee might be using other business critical applications in addition to email, or they may be using IP telephony bridged into the corporate PBX to appear like any other extension even when working from home.

This begs the question - who then pays for the home broadband and who is responsible for ensuring it meets the company's needs?

According to recent Quocirca research, the answers are by no means clear.

More than a third of medium to large enterprises across Europe already have employees using broadband to work from home, with another third starting to become active in this area. Around a quarter of companies are providing and paying for their employees' connections and of the rest, 17 per cent have employees claiming back all or some of the costs.

Home broadband is rarely going to be used solely for business purposes, so the employees are bound to be getting some benefit by being able to bank, shop, download content etc over that connection. This means the connection might be heavily used and by some less than friendly or even unsafe applications.

Are these appropriate network conditions for those employees working from home who have to conduct confidential business or who use mission-critical processes? Probably not but then can an employer really take full control of the broadband connection, compelling the employee to get another for personal use? And what happens when two members of the household work from home with different employers?

Ultimately it's unlikely employers will be able to dictate the network equipment used at home, such as a secure router at the entry point to the employee's household network. So how then do they retain at least some control, to ensure that corporate security and protection needs are met and that services used by the employee at home meet suitable service criteria?

The first step is to realise that once IT access is granted from outside the physical corporate perimeter, the infrastructure is outside of the business' control and the focus must be turned to the endpoints - the PCs, laptops and mobile devices.

If this hardware is provided and controlled by the business, it can usually be configured to meet security and connectivity needs. If not, then the endpoint has to be treated as untrusted and corporate services have to be delivered through virtually private managed network connections.

Some of the risks can be reduced if businesses take an active interest in the specification, cost and availability of domestic broadband services on offer to their employees. It might be possible to work in partnership with carrier suppliers to ensure more commonality across employees' network access.

However, the caveat as always is the uncertainty of 'events' as employees move on, and all too often carrier partners become yesterday's suppliers when a cheaper deal comes along. Perhaps the virtual extension of the corporate network into employees' homes offers an incentive and opportunity to take a slightly longer term view - especially if the carrier can take on some of the complexity of dealing with the network load-balancing of work and life.

India's five-year IT lead over China

2007-08-22T09:49:00.000+01:00

Emerging market China is unlikely to catch up with India's lead in global IT outsourcing in any "significant" manner over the next three to five years, according to a report by the National Association of Software and Service Companies (Nasscom).

The report said China's IT sector, which is estimated at more than £75 billion, is still less than a third of India's, but represents a "substantial" market for IT software and services.

IT hardware accounts for about 90 per cent of the total Chinese information technology market.

The software and services sector contributed just over £6 billion last year, and made up about 0.5 per cent of the country's gross domestic product (GDP) in 2006.

Dispelling the myth that China will overtake India as the preferred IT outsourcing destination in the short to medium term, the industry association said China was still in its early phases of evolution.

High-tech hospitals boost Cisco growth

2007-08-22T09:38:00.000+01:00

Company's healthcare unit is 'growing at a pace that is faster than Cisco overall and the industry overall', executive says Cisco is best known for selling routers and switches to telecommunications companies, but its strongest sales growth these days comes from an area that seldom gets much attention: hospitals.

Cisco has sold routers and switches to hospitals and insurance companies for years but, in 2005, it created a business segment focusing on healthcare. Since then, it has launched a wide range of equipment designed for hospitals.

It's growing at a pace that is faster than Cisco overall and the industry overall. We have doubled our sales over the last two years, Jeffrey Rideout, head of Cisco's healthcare practice, told Reuters in an interview.

While the company does not disclose financial results from the segment, Rideout said annual revenue is well over a billion dollars, out of Cisco's overall sales of about $35bn (17bn).

He forecast more growth ahead, as hospitals install wireless technology, and Cisco teams up with medical-device makers to ensure that more data can be shared on internet protocol networks.

Networks can help cut administration costs and improve productivity, and with the population ageing in much of the industrial world, hospitals had much to gain, Rideout said.

In addition to standard network equipment, Cisco offers hospitals gadgets to deliver and track health records electronically, and its internet-based system helps hospitals monitor medical equipment and respond quickly to nurse calls.

Cisco also incorporates its videoconference technology into Health Presence, a real-time conferencing system that connects patients and doctors, as well as interpreters. Along with more electronic data sharing, that can improve care and offer better access to people in remote areas, Rideout said.

Trained as a doctor of internal medicine, Rideout was formerly chief medical officer and senior vice president for not-for-profit insurer Blue Shield of California.

After serving on various advisory boards exploring ways of improving healthcare, Rideout said he thought that Cisco, one of Silicon Valley's most respected technology companies, offered the medical industry an interesting vehicle for change.

Chief executive John Chambers, raised by doctors in West Virginia, calls healthcare one of his chief concerns, saying he knows every serious illness among his employees and their families.

Often, when my parents were on duty, I spent the night in the hospital, and so I understand how the hospital works - both the efficiencies and the inefficiencies, he said.

While Nortel Networks and Juniper Networks also sell to healthcare companies, Rideout said Cisco's advantage was scale and experience of adding partners.

Cisco has partnered with GE Healthcare. Rideout said such partnerships are crucial to ensuring that data from devices such as blood pressure readers and X-ray machines are digitally formatted and deliverable over an internet protocol network.

Cisco plans to tie up with even more device makers. What we don't want to be is a medical-device company or a medical-advice company, Rideout said. But we want to help it work.

Sprint Nextel Bets on WiMax

2007-08-22T09:33:00.000+01:00

Sprint Nextel Corp. wants its WiMax network to serve more than just cellphones and laptops, a move that would change the business model of its wireless operations. Besides selling wireless service to subscribers, the wireless carrier is seeking to embed access to the network in more novel products, such as digital cameras and even billboards. Sprint thinks that move, along with other advertising opportunities, will diversify its wireless business away from its traditional subscription model.

"I'm absolutely convinced this model will work," Chief Technology Officer Barry West said at Sprint's Technology Summit last week. "It is a completely new, game-changing model."

The early WiMax revenue generated by Sprint will likely come from the subscription model. Longer term, though, the company hopes to make money from advertising. For example, it has a deal with Google Inc. in which more than half of the mobile-advertising revenue from the WiMax network goes to Sprint. It expects to post revenue of $2 billion to $2.5 billion from the network in 2010.

As a sign of the plan's significance to Sprint, the company has unveiled a new brand, Xohm, for the business. However, the company's history in building new brands is mixed.

"Sprint is a powerful telecom brand," Mr. West said. "We want to create an Internet brand."

WiMax is a wider-ranging form of Internet access similar to its cousin Wi-Fi, but it uses licensed spectrum and is considered more dependable.

Sprint Chief Executive Gary Forsee said demand for WiMax services won't grow without a large number of products that use the network. As a result, the company has teamed with Intel Corp., Motorola Inc., Samsung Electronics Co. and Nokia Corp. to release 50 million WiMax products over the next three years. Mr. West said Sprint was in discussions with other makers of consumer-electronic products.

One example presented was with a digital camera. Sprint could sell service, either as a one-time fee or regular subscription, that would allow consumers to send photos to their home computer from the camera through the WiMax connection.

Down the line, billboards with WiMax chips in them could link up with an individual's WiMax-enabled cellphone and present the bystander with a personalized advertisement. Cars traveling down the highway will be able to pick up and play video stored in computers at home.

The "embedded model" gives Sprint a chance to expand beyond selling just cellphones. It also gets the company away from using subsidies to push its service.

The 50 million devices expected over the next three years still pales in comparison to Wi-Fi-enabled devices. Roughly 200 million consumer-electronic devices are expected to carry Wi-Fi chips by 2010, according to ABI Research.

Sprint is making a costly bet -- $5 billion through 2010 -- that its WiMax network, which it dubs 4G technology, will pay off by winning new customers.

The company needs the help. The wireless carrier has been steadily losing customers over the past several quarters, and only in the recent quarter did it turn itself around. Management has warned that things could get worse in the third quarter.

"We believe the success of Sprint's 4G strategy is critical to its ability to arrest the company's current market-share decline in the U.S. post-paid market," UBS analyst John Hodulik said in a note.

The network won't just benefit Sprint. Fred Wright, who heads up cellular-network products and WiMax for Motorola, said he sees revenue opportunity in providing consumer devices, modems and networking equipment to support WiMax. In the 2010 to 2012 time frame, the market will be worth "billions of billions of dollars," he said.

"As 2G tapers off, broadband wireless will take off," Mr. Wright said. "It represents a good replacement technology."

The low-key debut of Xohm (pronounced "zome") was meant to replicate the quiet groundswell of support that Google or Facebook enjoyed in their early days. It is unclear, however, whether the Xohm name will garner the same following as its more-famous Web predecessors.

Mr. West said it was necessary to create a separate brand so Sprint and Xohm products can be sold at the same locations but at different price points. Laptops and other electronic devices will boast Xohm stickers similar to Intel's Centrino stickers.

"That's a great long-term goal," said David Placek, chief executive of brand-consulting firm Lexicon Branding Inc. "But I think those things are difficult to pull off."

Sprint has had varied success with its brands. The company initially caused confusion by attempting to tie the Sprint and Nextel brands following those companies' merger, which partly resulted in the defection of Nextel customers.

Its Pivot brand, which is a wireless joint venture between Sprint and four cable companies, took more than a year to get off the ground and hasn't made much of a dent.

Sprint, however, has done well in positioning Boost Mobile as a youth-oriented brand, and is seeing sporadic success in going after Leap Wireless International Inc. and MetroPCS Communications Inc. with its expanded Boost Unlimited service.

Google unveils YouTube advertising format

2007-08-22T09:32:00.000+01:00

Google will today unveil a new advertising model for YouTube which it claims is five to 10 times more effective than other advertising formats currently carried on the video sharing site. YouTube will introduce semi-transparent animated 'overlays', which appear across the bottom fifth of the video window a few seconds after each clip begins and can be clicked on to show the full advertisement.

The US internet search company is hoping the new format will help address investors' concerns about YouTube's business model. Since spending $1.65bn buying the video site in October 2006, Google has been under pressure to explain how it would make a return on the investment amid fears its 100m users would reject attempts to commercialise the site.

'We have tried a lot of formats (and this is) the most interesting and the most respectful of the user community,' said Eileen Naughton, Google's director of media platforms.

A test of formats with 200 advertisers and content partners such as Warner Music, BMW and 20th Century Fox had shown that viewers were five to 10 times more likely to click through to the advertisement than with any of its other standard formats such as banner ads, shesaid.

After the overlay appears, about 15 seconds into a clip, a viewer can choose to close it, wait for it to expire automatically, or click on it to launch an 'in-video' advertisement, which plays while the original video clip is paused.

In trials, fewer than 10 per cent closed the overlay, Ms Naughton said, while 75 per cent of those who clicked through watched the entire advertisement.

Despite the rapid development of the internet advertising market, whichPwC estimates will grow from $31.6bn to $73.1bn between 2006 and 2011,marketers have expressed concern at signs thatmany users of popularwebsites were put off bycurrent formats such as 'pre-roll' ads shown before video clips.

Google said its research had shown users had little patience with pre-roll advertising, adding that 'video abandonment' rose in direct relation to the length of the pre-roll clips.

But Shashi Seth, YouTube group product manager, said the new format would overcome that problem. 'Our audience does not mind in-video advertising as long as it is not intrusive and does not meddle with their user experience.'

The new format, which allows users to rate or comment on the advertisements they see, will be restricted at first to the 'partner' sections of the YouTube site, which are sponsored byparticular advertisers orprofessional content providers.

Ms Naughton said this was to 'acclimatise' marketers to the format before deciding whether to roll it out to the user-generated video clips for which YouTube is best known.

Fraudsters target social networkers

2007-08-22T09:29:00.000+01:00

Millions of people signing up to Facebook, MySpace and other social networking sites could be leaving themselves, and their companies, open to online crime, IT security experts are warning. The practice of posting up personal information such as birth dates, addresses and phone numbers is proving to be a goldmine for identity fraudsters.

Businesses, meanwhile, are at risk from hackers who use details posted on em-ployees' social networking sites to find passwords and other details to help them get past corporate security.

David Porter, head of security and risk at Detica, the IT consultancy, says social networking sites are a treasure trove for hackers searching for details about companies. 'Even the most innocuous information about a business - people and the departments they work for, day-to-day processes, jargon and codes - can be valuable stepping stones for persistent criminals who want to infiltrate corporate security,' he says.

This week Monster.com, the US-based jobs website, suffered an attack in which hundreds of thousands of user details were accessed. While Monster.com is not a social networking site, the details it holds - names, e-mail and home addresses and phone numbers - are similar to those displayed on social networking sites.

Experian and Equifax, the credit information compan-ies, warn people to limit the information they display.

'People should be thinking twice about what they share on the sites because this information is gold dust to criminals. Your date of birth and name of your first school may seem like innocuous bits of information, but they are the building blocks to your identity,' says James Jones, consumer affairs manager at Experian.

He says Experian has seen a huge rise in identity fraud that was well researched and highly targeted.

MessageLabs, the internet security company, also says it has seen a large increase in highly targeted 'phishing' e-mails, which purport to be from trusted contacts and try to trick people into revealing details such as bank account numbers and passwords. Millions of phishing e-mails are sent each day, but a relatively small proportionare carefully targeted, getting details such as job titles correct.

In 2005 MessageLabs was intercepting about two of these a week and by early 2007 it had risen to 10 a week. In June the numbers exploded, with MessageLabs picking up more than 500 targeted e-mails in a few hours, all addressed to top executives.

'They were all headed toward board level executives. The names and job titles corresponded to the real ones. Somebody somewhere had really done their homework. It looked like the information on who to go for had been gleaned from a social networking site,' said Mark Sunner, chief security analyst at MessageLabs.

Security officials say companies should tell staff not to post details about their jobs online. Sophos, the IT security company, says about 50 per cent of employees are already blocked or restricted from using sites such as Facebook. Thisis mainly because ofconcerns about decreased productivity.

'Something seems to happen to people when they go online - they drop all caution,' says Mr Porter. 'A generation of potential workers is growing up who think it is perfectly OK to disclose everything.'

Social networking sites such as Bebo, MySpace and Facebook have recently increased their security tips to users and included privacy settings, specifying what is displayed and who can see it. Generally, full details can be seen only by people accepted as 'friends'.

However, only 20 per cent of Facebook users change the default privacy settings, and research shows many people are accepting strangers as 'friends'.

Sophos created a Facebook profile featuring a small frog called 'Freddi Staur' - an anagram of 'ID fraudster' - and invited random people to become friends. Some 41 per cent accepted. Of these, 72 per cent revealed e-mail ad-dresses, 78 per cent their address or location and 23 per cent a phone number.

'What is worrying is how easy it was for Freddi to go about his business. He now has enough information to create phishing e-mails or 'malware' (malicious software) specifically targeted at individual users or business, to guess users' passwords, impersonate them or even stalk them,' says Graham Clueley, senior technology correspondent.

Tellingly, many security professionals are reluctant to join Facebook themselves. 'I have just one line on Friends Reunited mentioning which county I live in,' says Mr Porter. 'Perhaps I'm more paranoid because of this job.'

Skills Survey 2007: Offshoring still a hot potato

2007-08-22T09:24:00.000+01:00

Is it a threat to your job? Offshoring is viewed with increasing ambivalence in the IT industry, according to the exclusive silicon.com 2007 Skills Survey.

A third of respondents to the survey agree or strongly agree with the statement 'I feel that offshoring is a threat to my current job' - a very slight increase on last year's result when 32 per cent feared their job could be sent abroad. At the same time, the number of people who don't view offshoring as a threat dropped to 41 per cent, from 44 per cent last year.

The proportion who aren't sure whether offshoring is a threat stands at 23 per cent - a rise of six percentage points on 2004's figure, suggesting increasing ambivalence about the impact offshoring is having on UK tech jobs.

A recent report by not-for-profit research organisation, The Work Foundation, found little direct evidence of significant job migration due to offshoring in Europe, yet public opinion often runs counter to that.

A recent silicon.com Reader Comment typifies the fears generated by offshoring. Discussing the issue, reader Karen Challinor wrote: If this [offshoring] keeps up we won't have an IT industry in this country as the only people working in IT will be non-technically literate managers.

However, according to The Work Foundation report: Indian business insiders see future offshore outsourcing as an advantage for Europe enabling it to focus on the 'thinking part of the job', providing opportunities for 'better jobs' and 'knowledge work' in Europe.

When it comes to specific job roles, rank-and-file IT workers have the biggest fears about offshoring. More than two-fifths of software/web developers responding to the silicon.com Skills Survey agree or strongly agree offshoring is a threat to them, while two-fifths of IT pros feel the same way. This compares to less than a third of CIOs, and just over a third of board-level executives and IT managers.

Nearly two-thirds (63 per cent) of survey respondents agree or strongly agree that IT jobs that involve business skills are less likely to be offshored than jobs which involve only technical skills.

Facebook banned by half of employers

2007-08-22T09:19:00.000+01:00

'Get yer nose out of that 'Book... ' Half of businesses are restricting employees' access to Facebook, due to concerns about productivity and security.

According to research by security company Sophos, 43 per cent of workers polled said their employer blocks Facebook access completely.

A further seven per cent said access is restricted depending on whether it's required for a particular job.

Graham Cluley, senior technology consultant at Sophos, told silicon.com: I think it's a growing concern for employers for a number of reasons. The most pressing concern at the moment is one of productivity.

He said: Some people are spending an inordinate amount of time on non-work related websites.

Cluley added it is difficult to tell when people are using a social networking site when they are sat at a computer.

The issue of security was also raised by the Sophos research. In a separate poll by the company, 66 per cent of workers said they are concerned about colleagues sharing information on Facebook.

Details such as employment history and mobile numbers have been found on the site and could be used for identity theft or to launch corporate phishing attacks.

Sophos research found 41 per cent of Facebook users are willing to divulge personal information to complete strangers.

Cluley said: Everyone's just sort of letting it all hang out online without thinking who might be watching.

Facebook told silicon.com it provides users with the ability to hide personal information and welcomes every opportunity to educate users about how to protect their data online.

Of the 50 per cent of companies that allow access to Facebook, Cluley said some view it as a valuable networking tool while others are nervous about the possibility of an employee backlash to a ban.

lol.

Vodafone and Verizon struggle to work together

2007-08-22T09:15:00.000+01:00

In public, Vodafone and Verizon Communications like to laud each other's contributions to Verizon Wireless, their US mobile phone joint venture. Sir John Bond, Vodafone's chairman, last month spoke of the 'good relationship' the UK mobile phone operator has with Verizon. Denny Strigl, Verizon Communications' chief operating officer, described Vodafone earlier this year as a 'very good partner'.

But Verizon Wireless has always been an uneasy marriage of convenience be-tween the two shareholders, with each company jostling for position.

The latest power play came this month, when Vodafone's board decided against exercising a put option that would have en-titled the world's largest mobile operator by revenue to sell up to $10bn worth of Verizon Wireless's shares to Verizon Communications.

Before reaching that conclusion, Vodafone and the UK company's advisers considered a range of options for the US mobile business. These included Vodafone buying Verizon Communications, the second-largest US telecoms company with a market capitalisation of $119bn, which could have provided a lasting solution to the tension inside the joint venture.

Verizon Wireless was formed in 2000, when Vodafone's and Verizon Communications' predecessor companies pooled their mobile assets after realising the importance of creating a US mobile operator with national scale.

Vodafone owned AirTouch, a mobile operator on the west coast of the US, while Bell Atlantic, a New York-based fixed-line phone company, had a wireless business covering the east coast. Chris Gent, then Vodafone's chief executive, opted against spending an enormous amount of time and money transforming AirTouch from a regional to a national mobile operator.

Instead, he decided to throw in his lot with Bell Atlantic, which was already merging with GTE, another regional US fixed-line phone company, to form Verizon Communications.

Verizon Communications, partly by contributing more mobile customers, ended up with a 55 per cent stake in Verizon Wireless, leaving Vodafone with 45 per cent.

The move might have created what was then the largest US mobile operator, but this was never going to be a straightforward partnership, partly because Vodafone had antagonised Bell Atlantic in 1999 by trumping its bid for AirTouch.

Two subsequent events underlined the two partners' different agendas. First, in 2004, Vodafone made a $38bn bid for AT&T Wireless, a rival US mobile operator but was outbid by Cingular.

The next year, Vodafone received its last dividend from Verizon Wireless, worth GBP 923m ($1.8bn). The payments dried up afterVerizon Communications instead decided to use those cash flows to pay down the mobile operator's debt.

Some analysts interpreted the move as an attempt to squeeze out Vodafone.

Ever since Vodafone's failed bid for AT&T Wireless, Verizon Communications has made plain its wish to secure exclusive ownership of the mobile joint venture.

Vodafone, however, has refused Verizon Communications' overtures to sell its 45 per cent stake, in spite of pressure from some of the UK company's investors.

Arun Sarin, Mr Gent's successor at Vodafone and a former AirTouch executive, has fended off calls for a sale, partly by pointing to the prospect of a resumption of dividend payments by Verizon Wireless in 2009.

Mr Sarin has also sought to placate investors by highlighting the increasing value of Vodafone's 45 per cent stake in Verizon Wireless. Analysts raised their estimates of its value from $38bn last year to Dollars 54bn this year.

Mr Sarin acknowledged last month that Vodafone would have to decide when the value of its Verizon Wireless stake would peak.

He argued that Vodafone had time on its side because the US mobile market would not be saturated for at least another three to four years - one reason that Vodafone decided earlier this month not to exercise its put option.

Vodafone also decided against exercising the option because there was insufficient certainty it could secure a one off dividend derived from a revaluation of Verizon Wireless. It could have resulted in long running litigation between Vodafone and Verizon Communications, which neither company wanted.

Apple secures Europe iPhone revenue deals

2007-08-22T09:14:00.000+01:00

Apple has succeeded in committing European mobile phone operators that want to sell exclusively its new iPhone to share some of their revenues with the US computer maker. Contracts between Apple and three mobile operators require them to hand over 10 per cent of iPhone revenues derived from phone calls and data functions to the US computer group, people familiar with the situation have told FT Deutschland, the Financial Times' sister paper.

The contracts with T-Mobile of Germany, Orange of France and Oin the UK were signed in recent days, according to these sources. T-Mobile, Orange and O2 declined to comment.

'These are not negotiations among equals. Apple clearly had the upper hand,' one industry expert told FT Deutschland.

The deals mark a shift in the balance of power between mobile phone makers and network operators.

The operators have previously resisted efforts by handset manufacturers to secure revenues derived from mobile usage.

The only previous example is Research In Motion, the Canadian maker of the BlackBerry handheld device, which has a revenue share with mobile operators.

AT&T, the largest US mobile operator, agreed to a revenue share as part of its exclusive deal with Apple to sell the iPhone in the US.

Apple's deal with Deutsche Telekom, owner of T-Mobile, could be significant because Germany's leading telecoms company is trying to shed its image as a slow-moving business that gives poor customer service.

It has issued two profits warnings since August last year and is relying heavily on T-Mobile for growth.

Hamid Akhavan, head of T-Mobile, is said to have pressed for personal talks with Steve Jobs, Apple's chief executive.

France Telecom, which issued a profits warning last year, could also get a boost from iPhone. Like Deutsche Telekom, France Telecom is relying on mobiles for growth because its fixed line phone business is in decline.

AT&T experienced an initial surge in iPhone sales. Almost 150,000 devices were activated in the first day-and-a-half the iPhone was on sale in June, AT&T said at its second-quarter results last month. It is unclear whether that has continued.

Apple has wooed the European mobile operators with a financially risk-free business, as it will not allow the iPhone to be subsidised; most mobiles sold by operators to customers are subsidised heavily. In the US, the iPhone sells in two formats for $499 and $599.

Apple plans to limit iPhone's European launch this autumn to the UK, France and Germany. It will continue the roll out elsewhere in Europe next year, when it will launch in Asia.

Apple declined to comment.

Unhappy time at Virgin Media ends for Burch

2007-08-22T09:12:00.000+01:00

The 'family and personal reasons' cited as explanations for Steve Burch's decision to leave Virgin Media were said yesterday to be genuine, rather than the euphemism usually trotted out to cover up a sudden corporate or political parting of the ways. But they were only one factor, capping an unhappy period since Mr Burch was brought in by Jim Mooney, chairman of what was then NTL, to make sense of its merger with Telewest and the acquisition of Sir Richard Branson's Virgin Mobile.

Mr Burch, a veteran of Comcast who had taken some credit for the US cable group's rapid integration of 2m AT&T Broadband subscribers, was a hands-on executive who could bring 'gold-standard' practices to the UK's under-invested cable industry, Mr Mooney said at the time.

But just over 18 months later, Mr Burch has become the third chief executive of the former NTL to leave suddenly since Mr Mooney arrived in 2003. Rumours about Mr Burch's position have circulated for months, amid reports of tension with his powerful chairman.

Mr Mooney, based in the US, took the lead on the company's negotiations with private equity groups and other suitors, leaving potential bidders with the impression Mr Burch had been sidelined from strategic discussions.

Analysts said Mr Burch should take credit for integrating the former NTL and Telewest, improving customer service and harmonising technology systems, but said he had not stemmed the market share losses to aggressive competitors.

Second-quarter figures released this month showed the group losing market share in every area. Underlying revenues from its core consumer business were down 4 per cent, and just 125,000 of its 4.7m customers had signed up for its 'quadruple play' bundle of pay-TV, broadband, mobile and fixed-line telephony.

Mr Burch's arrival was followed by the entry of both Carphone Warehouse and British Sky Broadcasting into the broadband market, triggering a bruising price war, analysts noted.

'The arrival of Carphone and Sky would have been a challenge to any manager, particularly a manager coming in from the US,' said Claire Enders of Enders Analysis.

Mr Burch's operational achievements were also overshadowed in the past six months of his tenure by a bitter public relations battle over the cost of carrying BSkyB's channels, which cost Virgin Media 40,000 customers in the second quarter.

Mr Burch's departure leaves to Neil Berkett the challenge of promoting the new Virgin Media brand, solving its customer service and technology problems and finding revenue growth in an intensely competitive pricing environment.

Shareholders, analysts and people close to the company expressed faith in the new acting chief executive, saying he had the full support of Mr Mooney and the rest of the board.

'There is a lot of confidence in Neil,' a person close to the company said.

With intensifying competition, the prospect of a sale and the challenge to ensure his job becomes permanent, however, Mr Berkett's task seems no easier than the one Mr Burch faced.

Toshiba crams 320GB onto 2.5in HDD

2007-08-22T09:08:00.000+01:00

Toshiba has created the world’s largest capacity 2.5in hard disk drive, packing a stonking 320GB into the device. The storage monster is just one of nine-strong range of 2.5in drives destined for a selection of devices, including high-end notebook PCs.

The manufacturer said that the MK3252GSX 320GB boasts an improved read-write head and an enhanced magnetic layer that helps boost areal density. It uses two 160GB platters and has a rotational speed of 5,400rpm, a significant improvement on its 200GB perpendicular recording MK2035GSS 2.5in notebook hard drive, which also has a twin-platter and four-head design.

The MK3252GSX drive can also withstand a 350g operating shock and 900g non-operating shock, which is also a slight improvement over the MK2035GSS’s 325g operating and 850 non-operating shock resistance levels. It also features 8MB of buffer memory, average seek time of 12ms and an ATA8 interface operating at 3Gbps.

Toshiba’s eight other new 2.5in drives range in capacity between 250GB and 80GB, with one 250GB drive offering 5,400rpm, 8MB of buffer memory, two heads and an ATA8 interface, with 12ms average seek time. In addition, a 200GB drive offers the use of four heads, a 7,200rpm and 16MB buffer memory.

There are also two ranges of 160GB, 120GB and 80GB drives. One range incorporates near-identical capabilities to the 250GB drive, but uses single platters. The second range mirrors the 200GB drive’s capabilities, but offers a range of heads and platters.

All nine drives feature a Free Fall Sensor function, which Toshiba claims detects a drive falling and then parks its head before it crashes.

The range is expected to be incorporated into devices during the fourth quarter of this year.

No news is good news.....

2007-08-17T08:50:00.000+01:00

.... Or is it?

Just to let you all know i'll be afk (Away from keyboard ;] ) Monday so there won't be any news that day.

If I have time Tuesday i'll try and post the best of the rest for you.

Whilst I am here, feel free to email me at madmatt86[at]bluebottle[dot]com with any suggestions, thoughts or requests!

Thanks, as always,

Matt

The resurrection of free: Companies rethink paid content

2007-08-17T08:46:00.000+01:00

With The New York Times and The Wall Street Journal said to be looking at removing the “pay wall” around their online content, and others – including CNN, Google and AOL – having already done so, one question springs to mind: Are we seeing the death of paid content online, and the return of free as a business model? A recent report in the New York Post said that the Times would soon do away with its Times Select service, which charges readers $50 (U.S.) a year for access to columnists, editorials and other features. News Corp. founder Rupert Murdoch, meanwhile, has talked openly about the possible benefits of doing away with the online subscription model at the Journal, which he recently acquired with his purchase of parent Dow Jones.

Such a move by the prominent business daily would be a significant event. As one of the early adopters online, the Journal has not only been at it for a fairly long time, but is also routinely held up as a shining example of how charging readers for content can be a profitable business.

But if both the Times and the Journal are making money from their online subscription services – which they reportedly are – why would they do away with them? The simple answer is that opening their content up to a broader audience could provide even more revenue in the form of advertising, and more growth potential (since neither service is growing very quickly, if at all).
CNN apparently came to the same kind of conclusion about its online video service, formerly known as CNN Pipeline. The news network charged users $3 a month for access to news videos, but last month it shut down the service and made its video content free.

One CNN executive admitted that while the venture made some money, not enough people were signing up to make continuing with the project worthwhile.

Although the news network didn't mention it specifically, it seems likely that the rise of
YouTube and similar free video-sharing sites made it difficult for CNN to continue trying to charge users for access to video.

Google – which now owns YouTube – appears to have come to a similar realization, and recently closed its Google Video service, which charged users to download movies online.
One of the most prominent services to switch from a paid subscription model to a free one is America Online, the former Internet giant that merged with media conglomerate Time Warner in 2000, in one of the most ill-fated business deals in modern memory.

After watching millions of subscribers vanish from its accounts every year, AOL moved last year to make much of its content free online. Even Hot or Not, a popular online dating service, recently dropped its membership fees and went free.

Not everyone has abandoned the idea of charging users for digital content, however, and some companies have managed to create substantial businesses by doing so.

One obvious example is Apple, with its iTunes music business. Another is Major League Baseball, which generates hundreds of millions of dollars a year by charging for access to video and statistics from games. And while it is difficult to get reliable numbers, there are reports that some online porn operators make a decent living.

At this point, charging for online content only seems to work if the content is seen as exclusive in some way – and even then, the size of the market that can be accessed in that fashion appears to be fairly small, as indicated by the slow or even non-existent growth at both the Times and the Journal.

The flip side of the decision to go free, meanwhile, is that companies choosing to do so add to the already growing number of online businesses whose sole revenue generator is advertising.
And while the number of advertisers interested in the online market is also growing, it may not be growing quickly enough.

If you're a fan of online content, the move to free no doubt seems like a great idea. If you're a company whose business is charging for content, however, things are a little more complicated.

nazzy new technology has made me fall even deeper in love with radio. And I'm clearly not alone

2007-08-17T08:42:00.000+01:00

While across the land radio station executives look to the usual explanatory suspects in the wake of yesterday's Rajar quarterly audience figures - any minute now I expect someone from London's ailing Capital Radio to blame the miserable weather or stock market wobbles - one thing is beyond doubt: the way we listen to radio in Britain is changing. In 2003, 900,000 of us tuned in via digital radio. Yesterday's Rajars, the first to measure how people listen as well as what they listen to, revealed that 12 million people now access digital radio through DAB sets, satellite or digital television, and the internet. Podcast downloads are up too, with a jump from 1.9m downloads of radio material to 2.7m, and there is also a steady increase in the number of listeners aged 15 and over tuning into radio via their mobile phones.

Heartening though these figures are to those of us already smitten with radio, they should come as little surprise. What has happened in the past few years is that radio technology has finally been able to enhance what we already enjoy about the medium and deal impressively with its less lovely aspects. So, thanks to internet radio, it no longer matters where you are listen ing from; issues of signal, broadcasting licenses and geography are just so analogue. These days you hear requests on-air from people tuning in live across the miles and time zones, and there is nothing to stop a spot of radio globetrotting from the comfort of your own home. I've just spent the morning at my desk in Cardiff listening to an American station dedicated to the twin pleasures of running and fine beers.

Digital radio also puts an end to the masochistic challenge of listening, say, to Five Live, the World Service or Virgin on medium wave. The only place I don't have DAB access is in my car, because I drive so little, and it's there that I get a reminder of just how egregious this experience is, with its warping and waning of output that seems to be coming from the bottom of a very deep, and intermittently electrocuted, well.

The new ways of listening embellish radio's unique selling point: the fact that it forms an amiable, well-behaved backdrop to your life. You can multitask around radio simply because you don't have to look at it - imagine the results of simultaneously driving and watching television - and each of the advances in radio delivery consolidates this relationship. My DAB sets are eminently portable, moving around the house and garden with me, and include snazzy features such as the ability to pause, rewind and even fast-forward output (I use this last one almost exclusively for the more trying moments in The Archers).

Listening online brings the obliging joy that is the BBC's Listen Again service, so you can tune into favourite programmes when it suits you, and podcasts for radio on the go. If anything, such advances have made an already personalised relationship between listener and broadcast - it's well documented that audiences regard favourite stations and presenters as friends - into something even more intimate and bespoke. That one-to-one connection you feel with radio, even if you listen while frantically busy or stressed, has been admirably strengthened by the technological developments. It is this pairing up of increased, flexible access to radio and seemingly unshakeable loyalty to the medium that gives such cause for optimism in radio circles these days.

One last statistic to bolster that feeling: across all ways of listening, not just the new, hi-tech sexy ones, radio audiences are up, and 91% of the population now accesses radio regularly. That's cheering news, and shows radio in much better health than television, with its dwindling audiences, much-publicised fakery an addiction to cheap reality formats. But as a radio fan and critic, I can't help worrying about that other 9%. They really don't know what they are missing these days.

China Mobile put off by high asset prices overseas

2007-08-17T08:40:00.000+01:00

High valuations for telecommunications assets in emerging markets are discouraging more overseas acquisitions by China's largest mobile phone company, China Mobile, its chief executive said yesterday. 'We will focus on emerging markets,' Wang Jianzhou said of his company's acquisition strategy. 'Unfortunately it is a bad time for buyers in emerging markets because (telecom assets) are very expensive.'

In January, China Mobile's parent company paid $284m for an 89 per cent stake in Paktel, the Pakistan telecommunications company. It was the group's first step beyond its own borders.
China Mobile had earlier abandoned what would have been a much bolder, $5.3bn offer for Paktel's controlling shareholder, Millicom.

The Chinese telecom group is investing to expand Paktel's network. 'Pakistan is a very big market with huge potential but (Paktel's) network coverage has been poor. We have to do more construction there,' said Mr Wang, who also predicted that Pakistan would become an important new 'growth spot' for his company.

China Mobile has the right to purchase Paktel from its parent at a future date.

Earlier this year, Vodafone of the UK agreed to pay $11bn for Hutchison Essar, India's fourth-largest mobile operator, controlled by Hong Kong tycoon Li Ka-shing, after a protracted and bitterly contested bidding war highlighted the intense demand for telecom assets in developing markets.

Cash-rich China Mobile yesterday announced a 26 per cent increase in net profit to RMB37.907bn ($4.98bn). But the company's expansion opportunities at home have been frustrated by a long delay in the issue of 3G licences.

Mr Wang said tests of China's homegrown 3G standard across an experimental eight-city
network would be completed by China Mobile's parent at the end of October. However, he declined to predict when the country's long-awaited 3G licences would be issued.

In its search for growth at home, China Mobile is continuing an aggressive push into the country's rural areas. The company's subscriber base grew more than 20 per cent to 332.4m over the first six months of the year.

'There was remarkable growth in the number of new customers,' the company said. New customers from rural areas 'represented half of all newly acquired customers'.

Fujitsu tells of French request for investment

2007-08-17T08:35:00.000+01:00

Fujitsu, which was thwarted this week in an unsolicited bid for France's GFI Informatique, said yesterday it was surprised as Paris had asked the Japanese group to invest in the French market. Fujitsu launched an unsolicited takeover bid for GFI, the French IT services group, in
May in a rare move by a Japanese company.

However, after a vote this week Fujitsu only managed to receive 41 per cent of all outstanding shares, well below the 66.7 per cent it needed. GFI fought Fujitsu's offer, calling it 'hostile and unsolicited'.

Takanori Katayama, president of Fujitsu's global strategies and alliances unit, said the company had discussed its rationale and its price with GFI. 'Someone interpreted it as a hostile bid. I thought we had established a good relationship between France and Japan. I spoke with (government officials) and they asked us to make an investment in the French market, and we discussed how we could penetrate and expand our business in the French market.'

Fujitsu, which reported a 80 per cent drop in quarterly operating profit last month because of sharp price falls for systems chips and hard drives, is trying to move away from hardware towards high-margin IT consultancy work.

The Japanese group has been keen to gain a foothold in Europe's IT services market. Although it is a dominant player in the Japanese market, it lags behind industry giants such as IBM in overseas operations - particularly in France, one of the biggest markets in Europe.

Mr Katayama said: 'France is the most significant market where we do not have a footprint. We will continue to seek out every possible opportunity to expand our business in the French market, including strategic alliances and possible future acquisitions.' Fujitsu's bid for GFI was valued at Euros 395m ($532m). GFI said the Euros 8.50-a-share offer 'undervalued' the company.

With the Japanese IT services market expected to grow only 2 per cent over the next two years - compared with7 per cent for Europe, the Middle East and Africa and 13 per cent for China - Fujitsu is keen to pursue overseas acquisitions and tie-ups. The group bought TDS, a German systems developer, in January for Euros 100m.

Mr Katayama said: 'In order to compete with IBM we need a differentiating strategy. We need to strengthen our Indian operations and offshore capabilities with regard to Russia.'

But in a coup for the company, Fujitsu said it had been awarded a Pounds 500m, 10-year contract by Reuters to provide IT services for the media services group. Fujitsu Services will provide IT services for 17,500 Reuters employees across more than 100 countries.

iPhone rumour mill continues to turn

2007-08-17T08:32:00.000+01:00

Latest twist sees pricing details for O2, Vodafone contracts with Apple handset published on U.K. website. With each new day comes a new rumour about the arrival of the iPhone in Europe, but Thursday's twist is perhaps the strongest hint yet as to which carrier will actually launch the uber-hyped handset.

Online retailer mobiles.co.uk – which was acquired Thursday by Carphone Warehouse for an undisclosed sum – is advertising the iPhone on its website. Furthermore, the company is offering customers the chance to pre-order the handset on contracts with either O2 or Vodafone.

Some have dismissed the appearance of the handset on the site as little more than a publicity stunt, designed to draw attention to Carphone's acquisition of mobiles.co.uk, a move that will boost the service provider and retailer's online presence. Incidentally, Carphone plans to continue to run mobiles.co.uk as a separate entity.

However, albeit one of many in the industry in recent months, the rumour that Vodafone and O2 will share the iPhone spoils is not new. So maybe what is being described as a "glitch" on mobiles.co.uk's site is a genuine indication of how the handset will come to market.
Furthermore, the site includes pricing information for customers wanting to pre-order the phone.

A contract with O2 through the retailer will cost £35 per month, including 400 bundled minutes and 50 text messages, while the phone itself is priced at £99.99. There are no pricing details on the site for a Vodafone contract, but customers are still being invited to pre-order.

It remains to be seen how accurate that information proves to be.

A disclaimer on the website notes that "pricing and information for the Apple iPhone is based on the best information available to us at this moment in time", and is subject to change.

Meanwhile, across the Channel, incumbent operator Orange is this week's favourite to bring the iPhone to France.

The mobile operator has secured a deal with Apple and plans to launch this autumn, French newspaper Le Figaro reported Wednesday, citing "several independent sources".

The newspaper corroborated a similar story that appeared on MacScoop, an online network for Apple Mac and iPod users, earlier in the week.

According to MacScoop, Orange's sales teams have been preparing launch campaigns for the iPhone for a month, just in case the operator were to win the coveted deal with Apple, the paper said.

It added that Orange may distribute the phone through French retail chain FNAC.
At launch, which the paper says is likely to happen after the Apple Expo show in Paris in late September, the operator is expected to have 50,000 of the handsets available.

But until a formal announcement is made, the industry will just have to wait and wonder.
In the meantime, if you want to have your say, why not vote in our new Total Telecom poll, Who will launch the iPhone in Europe? Click here to vote and to view the results so far.

BBC iPlayer broadband row - who's really to blame

2007-08-17T08:27:00.000+01:00

Bandwidth dreams and nightmares for ISPs claims by ISPs that the BBC should fund the extra bandwidth needed by users that want to download content from its online TV service iPlayer seems a little out of touch.

Tiscali says as the BBC is responsible for the content and the distribution service, it sees no reason why the corporation shouldn't fund the extra bandwidth that users will be using.

Downloading of rich video content is only going to grow over the next few years and ISPs will need to be able to cater for this. If ISPs can't cope, they're not going to last much longer in the changing online landscape.

The specific issue seems to be that iPlayer is a peer-to-peer system so that it uploads and downloads data at the same time, making it potentially bandwidth-heavy.

Added to this, the programmes take around half an hour to download so a lot of bandwidth is used over a sustained period of time.

But to charge a content provider to distribute material just because it takes up more bandwidth cannot be justified in the long term. More and more services will appear which demand as much, if not more, bandwidth and so perhaps one day soon the demands of the iPlayer will seem positively thrifty.

With the number of users for iPlayer likely to be ramped up over the coming few months it's really down to the ISPs to adjust so their customers can make full use of what the service has to offer.

Eventually, ISPs will have to accept they need to offer greater bandwidth and download limits so customers can use the growing number of services but for now some at least may continue to stick their heads in the sand.

Sure, the ISPs might work on thin margins for consumer broadband. But there is certainly a sense that now the iPlayer has arrived, something that might actually make consumers want to use the high speed home broadband they have been sold, that the ISPs are turning round and asking for more money.

It's not an argument that's going to impress businesses out there working on the next big thing - be it a media player or a website - that demands lots of bandwidth. They won't want to pay the ISPs for the extra bandwidth used and nor should they. If ISPs were allowed to tax content providers in this way it would have a chilling effect on the industry.

Consumers have been sold a fully fledged broadband service at a set price and if that service can't handle the rich video content users want to see then it's a problem for the ISP and its pricing structure, not the BBC.

The ISPs have sold the broadband dream - now they must make sure it doesn't turn into a nightmare.

Is outsourcing too expensive?

2007-08-17T08:20:00.000+01:00

Small businesses certainly think so... The cost of outsourcing is still too high for smaller businesses, many of which are reluctant to put outsiders in charge of their IT systems.

A Datamonitor survey of 500 UK SMEs (companies with 10 to 100 employees) found that while outsourcing may have advantages such as freeing up employees to work on other business issues, only 25 per cent of smaller businesses have embraced it.

Almost 60 per cent of the SMEs surveyed said they can never imagine their IT function will be fully outsourced.

Customer service and quality of service are the top priorities for SMEs when selecting an IT vendor, and the businesses that responded to the survey said they are more likely to choose a national ISP or telecoms provider for managed services, with local or specialist providers being their last choice.

With the exception of telephone and mobile comms, there is no dominant IT supplier for SMEs. For example, when asked to name their current supplier for network services, more than 100 different vendors were mentioned, the analyst group found. The exceptions are telephone and mobile telephone solutions - more than 70 per cent of the SMEs purchase their telephone services from BT, and it is also the most popular supplier for network services and managed server hosting.

Datamonitor technology analyst Aphrodite Brinsmead said SMEs are unaware of the outsourcing options available and this may stem from vendors having previously overlooked the SME space.

Compact Disc: 25 years old today!

2007-08-17T08:15:00.000+01:00

The Compact Disc is 25 years old. Though the digital audio format's development stretches back many years before 17 August 1982, that was the date on which the world's first CD pressing plant punched out its very first disc.

According to Philips - with Sony, the format's co-developer - the first disc off the Hanover, Germany production line was Abba's The Visitors.

While CD production commenced in August 1982, the format wasn't formally brought to market until November, and then only in Japan. US and European music lovers had to wait until March 1983 for the first discs specifically tailored for them.

They embraced the format wholeheartedly. In the UK, Dire Straits' 1985-released Brothers in Arms was immediately snatched up by early adopters keen to put their new CD players through their paces. It was one of the first CDs produced from a digital master made from digital recordings - a so-called 'DDD' album.

But other albums proved even more popular. For many years, it was claimed record label EMI had a single CD pressing plant to producing copies of Pink Floyd's Dark Side of the Moon, such was the demand for that album. Dark Side of the Moon remains the archetypal CD album - who wants to get up and turn an LP over when you're happily getting intergalactic to the Floyd's spaced-out sounds?

The development of the CD stretches back to 1979 when Sony and Philips established an engineering team to create a disc capable of stopring music in digital form. According to Philips, the original design spec called for a 11.5cm-diameter disc capable of holding an hour's music, but this was later extended to 12cm and 74m minutes - sufficient to accomodate the whole of Beethoven's 9th Symphony. Some writers claim this was driven by Sony co-founder Akio Morita, in order to ensure his favourite symphony could be stored on a single disc.

In June 1980, the development specification was frozen and enshrined in what the partners called the Red Book. Later, the arrival of the Yellow Book would see the publication of the CD-Rom specification for computer use.

It might be assumed that the CD's digital encoding is sufficient to ensure perfect fidelity. Not so. Poor laser focusing, discs that wobble as they spin introduce noise into the signal, and the inevitable dust and fingerprints that accumulate on the surface, forcing the format's developers to come up with some clever error-correction technology to compensate. Indeed, listen to a disc without the special encoding, and there's almost as much hiss as music, and arguably worse than the sound produced by cassette tape.

To get around the problem, CD uses a technique called eight-fourteen modulation (EFM) developed by Dutch digital recording boffin Kornelis Antonie Schouhamer Immink. The data stream is broken into blocks, each eight bits long - and half of the 16 bits used to encode the sample of the soundwave taken 44,100 times a second. The eight-bit block is matched against a list of possible bit patterns and a 14-bit code read off the table, hence eight-fourteen.

The 14-bit codes are cleverly crafted to ensure any two binary ones in the code is separated by 2-10 binary zeros. Three further bits are used to separate the 14-bit codes on the disc. While this approach may be less efficient from a storage space perspective - 17 pits on the disc's data surface are used to encode half that number of bits - it makes it much easier for the optical head to read the data correctly.

CD encoding also employs Cross-Interleaved Reed-Solomon Coding (CIRC), which adds an extra, parity byte for every three bytes of data. The upshot: the player's electronics can easily and efficiently 'guess' what data masked by errors should have been, eliminating clicks and pops.

More advanced versions of this technique would later be used in DVD and Sony's Super Audio CD (SACD) format.

The SACD has yet to win the broad appeal enjoyed by the CD, which proved a major driver for the music industry as consumers dashed to replace old or scratched vinyl LPs and hissy cassettes with shiny new compact discs. By the late 1990s, however, in part due to the growing popularity of computer games, and first sell-through videotapes and later DVDs, but also the advent of both the MP3 music format and peer-to-peer file sharing networks, CD sales began their inevitable decline.

CD remains the dominant format for legitimately purchased recorded music - some 200bn have been sold in the past 25 years, Philips reckons - but it's lead is being eaten into by downloads. Fans are finding they'd rather buy individual tracks than albums of songs. This week, the UK recording industry's Annual Survey forecast that Apple's iTunes store will outsell other music suppliers within two years - on other words, downloads will have become more popular than the CD.

LCD will dominate display market by 2011

2007-08-17T08:14:00.000+01:00

If you’re thinking of buying a plasma display, or already own one, then it seems you could be in a minority by 2011. Analyst In-Stat has predicted that within four years LCD displays will account for almost 75 per cent of the market, while plasma will only take home around 15 per cent.

The analyst also forecast that worldwide digital TV unit shipments will grow from 68m units in 2006, to over 144m by 2011. Total revenue will also increase from $71bn in 2006 to $76bn by 2011, but with retail prices putting pressure upon revenue growth. In-Stat’s figures are based on research surveys in six countries, including the USA, UK, France and Japan.

The analyst’s research also revealed a mixed pattern of interest in HD TVs internationally. For example, only 13 per cent of US consumers exhibited an interest in HD TVs, while in France and South Korea 44 and 40 per cent of consumers were interested in the technology.

In 2006, Q4 figures from market watcher DisplaySearch said display manufacturers made more money from LCD TVs than they did from sets based on CRT technology, despite far more CRT TVs being shipped during the quarter.

The 2006 figures also discovered that plasma TVs accounted for 3.9 per cent of global display shipments during the quarter, up 109 per cent year on year.

Why Wi-Fi Networks Are Floundering

2007-08-16T14:57:00.000+01:00

Why Wi-Fi Networks Are Floundering; Faced with weak user demand, AT&T and other telecoms are vowing to tear up their muni Wi-Fi contracts if cities don't foot more of the bill.

The static crackling around municipal wireless networks is getting worse. San Francisco Wi-Fi, perhaps the highest-profile project among the hundreds announced over the past few years, is in limbo. Milwaukee is delaying its plan to offer citywide wireless Internet access. The network build-out in Philadelphia, the trailblazer among major cities embracing wireless as a vital new form of municipal infrastructure, is progressing slower than expected.

These potholes in the nation's wireless rollout of civic ambition -- criticized by many as an improper use of tax dollars -- are hardly the exception. For the road is getting bumpier for cities and the companies they have partnered with in a bid to blanket their streets with high-speed Internet access at little or no cost to users.

Telecoms Get Cold Feet

While 415 U.S. cities and counties are now building or planning to build municipal Wi-Fi networks, "deployments are slowing down slightly," says Esme Vos, founder of consultancy MuniWireless.com. Vos's tally still marks a nearly 70% jump from mid-2006, when there were 247 muni Wi-Fi projects on tap, but that's down from the torrid pace of a year earlier, when deployment plans doubled.

Perhaps the clearest hint of trouble ahead is that some of the companies partnering with cities on these projects, including EarthLink (ELNK) and AT&T (T), are having second thoughts about remaining in the municipal Wi-Fi business.

In San Francisco, recent developments have left many observers scratching their heads over whether that city's Wi-Fi project, announced more than a year ago, will ever get off the ground. In July, the president of the city's Board of Supervisors revealed that he was seeking to change the terms of the preliminary contracts awarded to EarthLink and Google (GOOG).

Earthlink Halts Build-Outs

While it's unclear whether he was referring to San Francisco in particular, EarthLink's new chief executive officer, Rolla Huff, promised in his company's July 26 earnings call to "delay any further build-outs and scale back operating expenses" on existing muni Wi-Fi projects. Though EarthLink doesn't disclose specific operating results for that business, there's little hope it will turn profitable soon. "The Wi-Fi business as currently constructed will not provide a return," Huff said during the conference call. EarthLink did not respond to requests for additional comment, while Google directed all questions about the San Francisco project to EarthLink.
AT&T, which made a splash as the only major telecom player to embrace the muni Wi-Fi market, is also showing some doubt. The company is "evaluating" whether to pursue any new deployments or even whether to continue working on its four existing projects, says Ebrahim "Eb" Keshavarz, vice-president for business development at AT&T.

Such comments contrast sharply with the optimistic terms that network operators have agreed to in many of these Wi-Fi deals.

Developers Seek Revised Contracts

When EarthLink and MetroFi first bid for Wi-Fi contracts several years ago, they often agreed to foot the bill for network build-out, operations, maintenance, and upgrades. They also frequently agreed to pay cities to lease public facilities, such as light poles, to hold Wi-Fi transmitters. If that wasn't enough, the companies also promised some cities a chunk of their subscription and advertising revenues, as well as free usage of the Wi-Fi networks by city workers. EarthLink's troubled San Francisco contract, for example, contains many of these terms.

One major flaw in these arrangements has been that initial forecasts for Wi-Fi subscriptions used to justify the investment in these networks have proven to be overly optimistic by a wide margin. In many cases, 15% to 30% of an area's population was expected to sign up for muni Wi-Fi. But only 1% to 2% have signed up so far figures Glenn Fleishman, editor of an industry blog called Wifinetnews.com.

While rising demand for advertising on municipal Wi-Fi networks is helping offset the shortfall in subscription revenue, there's a catch-22 at play here: Higher user numbers might generate more ad revenue, but network operators might need to cut fees to attract more users.
Subscribers Are Lured by Rivals

For now, a tiny user base can't even begin to cover an operator's costs. Take Lompoc, Calif., population 42,000. The city deployed its 11.3-square-mile Wi-Fi network last September, at a cost of more than $2 million so far. Today the network brags of just 442 users. Though Mayor Dick DeWees hopes to reach 1,000 users by year-end, the network needs 4,000 paying customers just to cover its annual operating costs. In Lompoc's case, the city is wealthy enough to absorb the expense for several years to fund a project it deems a public good. But companies are bound to be less patient.

Complicating the drive to boost subscription is competition: Wherever muni Wi-Fi networks are announced, phone and cable companies tend to lower their prices for broadband Internet access, says Fleishman. In Lompoc, where muni Wi-Fi access costs $16 per month for a family of three, Comcast (CMCSA) offers high-speed Internet access to new customers for $33 a month. In Beaverton, Ore., where there's no muni Wi-Fi service, the same product sells for $52.95. In addition, though Wi-Fi enables a user to gain access to the Internet as they roam a city's streets, the wireless signal can be weak indoors as compared to DSL service from a phone company or cable broadband.

To make the business more profitable, Wi-Fi service providers are trying to pass more of the cost to the cities. "There's no one that I am aware of right now who'd build a network without the city as a paying customer," says Lou Pelosi, vice-president for marketing at MetroFi, which six months ago stopped bidding for projects unless the city agreed to become the network's anchor tenant.

Cities Need to Cough Up

Cities unwilling to pay up may find their Wi-Fi projects with no takers. Gwinnette County, Ga., had to revise its approach when its first request for proposals in October, 2006, offering no payments from the county, brought no qualified bidders. The second time around, when the county offered a $750,000 grant to help build the network and develop applications for municipal use, only two small companies replied. "Wi-Fi doesn't have a solid enough business model for companies to be interested in this," says Barry Puckett, information technology services manager for the county.

Similarly, cities that have deals that don't currently require a government investment are being asked to renegotiate existing muni Wi-Fi contracts. In Portland, Ore., MetroFi says it is pushing the city for a formal commitment to buy network services. Thus far the network is about 20% complete, and serves the downtown area.

The payments cities face are sizable: The city of Corpus Christi, Tex., pays EarthLink about $200,000 a year to operate its Wi-Fi network, which covers 146 square miles, says City Manager George "Skip" Noe. Corpus Christi also effectively subsidized some of the network's construction: The city built out its initial network for between $6 million and $7 million, then sold it to EarthLink earlier this year for $5.5 million. The city uses the wireless network to collect data on gas and water usage, saving on labor costs.

Municipal uses like these -- as well as exploiting a Wi-Fi network for video surveillance and emergency communications -- can help justify a government investment. "We did an analysis, and over 20 years, there are multimillions in savings to the city," says Noe.

Either way, "The days of a service provider coming in without a city commitment are over," asserts Pelosi of MetroFi. "It's to help us out, but also to help them out."

FCC Opposes Silicon Valley VCs' Plan For Free Broadband

2007-08-16T14:50:00.001+01:00

The Federal Communications Commission is seeking to shut the door on a plan by a group of Silicon Valley entrepreneurs to offer free wireless broadband Internet service everywhere in the U.S., the chief executive of the group said Wednesday. M2Z Networks Inc. issued a statement Wednesday in which it said it would take the FCC to court in an attempt to force the agency to conduct a thorough analysis of the plan before it determined whether it would back it or not.

The company has proposed taking 25 megahertz of spectrum that is currently vacant and using it to build a wireless broadband Internet network to provide free service to 95% of Americans within a decade.

In addition to the backing of well-known Silicon Valley venture capitalists who count among their earlier investments Amazon.com Inc. (AMZN), Netscape, Google Inc. (GOOG), social networking site MySpace and TiVO Inc. (TIVO), the plan has the backing of a number of prominent lawmakers.

According to John Muleta, a former head of the FCC's wireless bureau and now chief executive of M2Z, the group was informed last week by FCC Chairman Kevin Martin's office that he had circulated a plan with the other four commissioners to deny M2Z's plan.

"We strongly believe that the FCC should fully and fairly review the detailed record associated with M2Z's license application...and make a decision consistent with the law Congress enacted," said Uzoma Onyeije, vice president of regulatory affairs for M2Z.

In order for the M2Z plan to succeed, it would require the FCC to hand over 25 megahertz of spectrum, which goes against a principle established a decade ago that the agency should sell off any spectrum in an auction.

In exchange for being given the spectrum M2Z would return 5% of any gross revenues its network derived to the U.S. Treasury.

The company would then use that spectrum to construct a wireless broadband network covering 95% of the U.S. population within 10 years.

The Menlo Park, Calif., company would seek to gain a return on its investment by offering access to the network on a wholesale basis. A group of high-tech companies including Google, Intel Corp. (INTC), eBay Inc. (EBAY) and Yahoo Inc. (YHOO) had aggressively lobbied the FCC that it mandate that another swathe of spectrum being sold early next year be operated on a wholesale basis. The companies were ultimately unsuccessful in their campaign.

M2Z would also offer a premium broadband service that it said would be faster than current DSL speeds offered by the telephone companies like AT&T Inc. (T) and Verizon Communications (VZ), for which it would charge between $20 to $30 a month.

It has pledged to filter indecent content distributed on the network and it would offer free access to the network to any federal, state or municipal public safety organization.

M2Z filed its plan with the FCC in May 2006, and until this week, hadn't heard anything back from the agency.

Muleta said the FCC was obliged to determine whether the proposal is in the public interest by May 2007, something it has so far failed to do. He also said it was facing a separate deadline of Sept. 1 to decide whether it approved of the plan.

In a filing to the FCC made this week, M2Z said one its advisors was contacted by a legal advisor to Martin, who said that the chairman's office was going to circulate a decision to the other commissioners that would deny the M2Z petition.

At the same time the Martin advisor said a rule-making procedure over what to do with the 25 megahertz of spectrum would be initiated.

An FCC spokesman declined to comment for this article.

Public interest groups have been strong advocates of the M2Z plan. Andy Schwartzman of the group Media Access Project said he was disappointed that it appeared the FCC had decided against M2Z's plan.

Noting that Martin has repeatedly publicly stated that it is a key policy objective of his to promote more rapid deployment of broadband, Schwartzman said the FCC should be willing to "take chances to enable broadband deployment."

"We think M2Z has a creative and potentially viable concept and we think the FCC should be promoting experimentation," he said.

Incumbent companies like Verizon and AT&T have lined up in opposition to the plan.
In March, CTIA, the wireless industry's Washington lobby group, urged the FCC in a filing to "move immediately to dismiss or deny M2Z's application."

The group opposes the proposal because it said it would circumvent the agency's auction process.

Now it's operators vs handset makers

2007-08-16T14:46:00.000+01:00

The battle for control of your mobile phone is about to enter an interesting stage. You may think that you are in charge. After all, you press all the buttons. But in reality the operators have been calling the shots for years. They have been trying to keep you within their walled gardens of paid-for services and charging by the amount of data consumed, leaving you with open-ended bills. They have even been fiddling with handsets to discourage use of the wireless connection appearing in an increasing number of handsets that can make near-free phone calls if you are in a Wi-Fi area.

This is understandable in terms of a desire to recoup the billions shelled out on 3G licences, but unacceptable when they pretend this is what consumers want. What consumers want is cheap phone calls and affordable music downloads from the web. They don't want to find out that the 99p track they downloaded ends up costing them £10 because operators have charged them for all the data passing through their networks.

This is why operators are up in arms about Nokia's upcoming N81 "music phone". It will offer what is being hyped as a seamless music download service that could gobble up some of the operators' revenues. If Apple, with its brilliant iTunes, is moving into the phone business then we should be unsurprised that phone companies are moving into the music business.

Nokia, which sells 1bn phones a year, is already the world's biggest supplier of mobiles, cameras and MP3 players. Its move into music downloads could make its long-held ambition to capture 40% of the world mobile phone market (against a current 38%) less of a pipe dream that it seemed a year ago.

Mobile music is potentially a far bigger market than cameraphones because listening to music is a more continuous experience than taking snaps. And surveys show that users want to download tracks to their phones as well as, or instead of, sideloading them from a computer at home.

Nokia reckons that all the technology is now in place and that the battle is now over design and usability. This is why Nokia has extended its links with archrival Microsoft to use the latter's PlayReady digital rights management (DRM) technology which enables music, games or videos to be shared between devices in a platform-neutral way. Although content access (the new euphemism for DRM) is still restrictive, it is much less so than before and could be popular with punters.

Operators argue that they have to subsidise the handsets and don't want phone manufacturers muscling in on their turf. To which Nokia replies that operators don't have to subsidise handsets (it doesn't happen in some countries) and no one is stopping operators doing what others are now doing in providing affordable music downloads and the ability to abandon your Sim card to make calls from your phone through the internet. Nokia rightly argues that if the operators don't provide these services then other companies will provide them instead.

They already are. During my summer holiday in France I tested yet another VoIP service (from WiFiMobile) offering voice calls over the internet using my Nokia N80. Phoning Britain (without a Sim card) worked well for nearly all calls. It cost 2p a minute to phone a fixed line anywhere in the world or 14p a minute to UK mobiles (after paying a monthly fee of GBP 7.99). The catch is you have to phone from a Wi-Fi hotspot. However, Wi-Fi is slowly being rolled out across Britain, though implementation of the more powerful WiMAX, with a longer reach, is hampered by lack of suitable spectrum. Meanwhile, operators had better prepare to offer more cheap Wi-Fi phone deals as well as music packages because, if they don't, others will. Led by giants such as Nokia.

Mobile social networking 'to ring up $6bn'

2007-08-16T14:43:00.000+01:00

Move over "dead time"... Social networking fans will drive mobile user-generated content revenues to nearly $6bn by 2012.

User-generated revenues from social networking services, dating and content uploaded to third party sites will increase from $572m in 2007 to more than $5.7bn in 2012, analyst house Juniper Research predicts.

Social networking is expected to bring in half of the $5.7bn total revenue by the end of the 2012 forecast period, according to Juniper.

Windsor Holden, principal analyst at Juniper Research, told silicon.com: People using social networking at the moment are sat in front of a PC. The advantage of the mobile means that people can use their dead time to continue using such social networking sites.

Holden said: There is an enormous advantage to either putting a version of those sites on the mobile or - through convergence - putting exactly those sites on the mobile.

The number of mobile users accessing social networking sites via their phones is also forecast to rise - from 14 million in 2007 to nearly 600 million in 2012.

Holden said making money on user-generated mobile content is a challenge, with the major fixed brands not yet fully established in the mobile environment.

Mobile dating and chatrooms currently account for 57 per cent of user-generated revenues, with this proportion falling to 21 per cent by 2012 as other services increase in popularity, Juniper predicts.

Separate research by mobile media company M:Metrics found 12.3 million consumers in the US and Western Europe accessed a social networking site through their mobile in June 2007.

The US has the largest number of on-the-go social networkers, with 7.5 million phone-toting social surfers during the month of June this year. Italy is next with 1.3 million and the UK is in third place with 1.1 million, the research found.

Apple's iWork Package Is Elegant but Wimpy Compared With Office

2007-08-16T14:41:00.000+01:00

When you hear that Apple has released a new product, you think of a sleek Macintosh laptop, or perhaps a beautiful program for editing videos. But a spreadsheet? Not a spreadsheet. After all, expertise with spreadsheets is the sort of computing skill about which the "Mac guy" in Apple's TV ads mocks the "PC guy." And yet, last week, Apple brought out a new spreadsheet program called Numbers, thus completing one of its least-known products: a productivity suite called iWork. The iWork '08 suite, which competes with the Macintosh version of Microsoft Office, also includes a word-processing program called Pages and a presentation program called Keynote.

The two were upgraded last week. IWork costs $79, about half the price of the lowest-cost version of Microsoft Office, which sells for $149.

In the past 10 years, Apple has out-designed Microsoft and its hardware partners in a number of key areas. But can Apple really take on Microsoft in the category of productivity software, where Office rules on both Windows and the Mac? To find out, I've been testing the new iWork, which runs only on the Mac, against the Mac version of Office.

My verdict: iWork '08 is a nice product, capable of turning out sophisticated and attractive word-processing, presentation and spreadsheet documents. It can even read Microsoft Office documents, whether created on the Mac or on Windows computers, and can save documents in Microsoft Office formats so they can be opened in Office on the Mac or on Windows.

But iWork simply isn't as powerful or versatile as Microsoft Office, especially when it comes to word processing and spreadsheets. And it suffers from a design that places far more emphasis on making documents look beautiful than on the nuts and bolts of the actual process of writing and number-crunching.

There's one big omission in iWork: It has no integrated email, contacts and calendar module comparable to Outlook in Windows or to Entourage, the Outlook equivalent that's a part of the Mac version of Microsoft Office. Apple decided to rely on the very good email, calendar and address book programs that it builds into every Mac.

But iWork has one big plus: It's the first Mac office suite that can open (though not create) files in the new formats Microsoft introduced in the Windows version of Office earlier this year. The Mac version of Office won't do that until Office 2008 is out in January.

The new Numbers spreadsheet has some refreshing innovation that makes it far more approachable for casual spreadsheet users than Microsoft Excel often is. Numbers allows you to place multiple spreadsheet tables, plus charts and graphics, on a blank canvas that you can arrange any way you want. Each of the spreadsheet tables functions like an Excel spreadsheet with individual cells able to hold numbers, text or formulas.

Numbers has some other nice features to make things simpler. Any cell meant to contain a value you type in can be controlled with a slider or up-and-down arrows, so you can rapidly see how different numeric values would alter calculations without a lot of retyping.

I also found that Numbers made it easier than Excel to sort columns, and to add or move columns and rows. It's also easier to create formulas using the actual names of columns and rows rather than their number/letter coordinates. And Numbers lets you drag and drop common formulas, such as Sum and Average, to the bottom of a column of numbers.

For real spreadsheet jockeys, however, Numbers is wimpier than Excel. It has only about half as many functions for making calculations and doesn't do pivot tables.

The Pages program was originally more of a page-layout program than a writing tool. The new version attempts to fix this imbalance with a less artsy word-processing mode. But the effort is only partly successful. It still de-emphasizes some writer-friendly features. For instance, its auto-correct function is much weaker than Word's. Another example: In Word, to see how many words your document contains, you just glance at the bottom of the screen. In Pages, you must dig down into a submenu to find the answer. The command for showing invisible formatting marks also is harder to find than in Word.

The strongest part of iWork is Keynote, the presentation program, which still makes it easier than Microsoft's PowerPoint does to make rich, beautiful slide shows. The new version isn't a major overhaul, but it includes a new feature called Instant Alpha that makes it easy to eliminate unwanted backgrounds from photos.

In my tests, importing and exporting documents between iWork and Office worked fine for simple files. But fidelity isn't always perfect, especially in Numbers, where missing Excel functions or Numbers-only features don't carry over.

If you're a Mac user with basic word-processing and spreadsheet needs, and a strong emphasis on design, iWork is good choice, especially if perfect compatibility with Microsoft Office isn't a high priority. But for office-suite users more concerned with function than form, I'd recommend sticking with Office.

Bonus for BSkyB chief

2007-08-16T14:36:00.000+01:00

The chief executive of broadcaster BSkyB has received a £4 million cash bonus after operational targets were hit. James Murdoch, son of media mogul Rupert, received the bonus on top of the near £3m remuneration package he got for the year to the end of June.

Bandwidth threat as on-demand TV grows

2007-08-16T14:31:00.000+01:00

Eyebrows were raised this week when the BBC's iPlayer suddenly lurched towards confrontation. Just two weeks after the video-on-demand software became publicly available, internet service providers were going on the offensive - claiming that they could be forced to throttle such services in order to save bandwidth. So-called "traffic shaping" measures - restricting the use of high-bandwidth applications - already happens with excessive downloaders, and is used to try to retain the speed of most broadband connections. But the threat to introduce similar measures against a public service such as iPlayer has resulted in confusion and anger on all sides.

Software makers say the ISPs should be running networks that can cope with the demand for video, while service providers are concerned that they are being forced to invest heavily in order to satisfy the commercial demands of others.

One assessment by media regulator Ofcom suggested it would cost the internet industry more than GBP 800m to keep up with the growth in online video. It's a debate reminiscent of the US argument over so-called "net neutrality", and stuck in the middle are the customers who have paid their ISP for "unlimited" downloads and handed over their licence fee to the BBC.

"I pay my ISP for a package that includes unlimited downloads," wrote one commenter, AJWimble, on our Technology Blog (tinyurl.com/yr88ll). "That means that if I download something from the BBC, I have paid the ISP for the bandwidth I am using so they have no right to complain. On the whole it sounds like this is a case of ISPs complaining because they may be asked to actually deliver what they already advertise."

The situation is made increasingly murky by the fact that many of the provid ers leading the charge - such as BT and Tiscali - also offer their own internet-based TV services. Some observers feel that it's just an attempt to kill off legitimate peer-to-peer services in favour of their own products - though the service providers reject the accusation.

"Something like iPlayer has the potential to become really mainstream; it's higher quality than YouTube and the downloads are 10 times as long," says Jody Haskayne of Tiscali. "It's 30 times the bandwidth."

The providers can foresee a number of solutions they may be happy with: the main one is revenue-sharing to pay for the cost of transmission, where the ISP in effect takes a cut of the cash made from the download. But while that could work for pay-per-view services like Channel 4's 4oD, it's trickier for the iPlayer, where video is free at the point of delivery.

Either that or, they suggest, people might start having to pay more for their broadband. Given that until now the industry has been focused on driving down prices while simultaneously driving up connection speeds, it is not hard to see why customers are left confused.

Revenue-sharing with the ISPs would be problematic for the BBC's iPlayer.

Young shun 'sell-out' MySpace for Bebo

2007-08-16T14:29:00.000+01:00

Bebo has overtaken MySpace as the UK's leading social networking site as young people increasingly shun the News Corporation-owned site. It had 10.7m unique users in July, compared with 10.1m at MySpace and 7.6m at Facebook, figures from internet tracker Comscore show. Bebo has been running almost neck and neck with MySpace for the past year, but July was the first month it inched ahead in the ratings, which are closely followed by advertisers.

John Delaney, analyst at technology consultancy Ovum, said: "What we saw, particularly after News Corp took MySpace over, was that the average age of MySpace users went up. It seems to be losing its youth appeal.'' Rupert Murdoch's News Corp bought MySpace for $580m ( GBP 290m) in 2005.

"You have feedback areas on these sites and you see a lot of comments saying, 'We like you guys because you haven't sold out like MySpace','' Mr Delaney said. "You are getting a lot of younger people who are shunning MySpace because it is seen to be part of the establishment.''

Bebo's owners have said they would prefer to go public via a flotation, rather than sell the site to another company.

Facebook is fast catching up with the two leaders. July data showed it entering the top 20 most popular sites in the UK, while back in January it did not even make it into the top 100 visited sites.

The site has been growing by 375pc since the beginning of the year, compared with 63pc at Bebo and 25pc at MySpace.

Cable and Wireless network deal with Virgin

2007-08-16T14:27:00.000+01:00

New three-year contract will see C&W providing IP VPN services to Virgin Atlantic, Virgin Trains, and others. Cable & Wireless Wednesday announced it has added to existing agreements with Virgin Group by securing a three-year multi-million pound contract to provide data communications services.

Under the new deal, Cable & Wireless will provide IP VPN services including security and WiFi application support services, to over 130 sites in the U.K.

The U.K.-based communications provider will work with a number of Virgin operating companies including Virgin Management, Virgin Trains, Virgin Atlantic and leisure business Virgin Active.

"The increased bandwidth will allow Virgin Atlantic's applications to work more effectively; and Virgin Trains to implement an IT refresh that is fundamental to its business," Cable & Wireless said in a statement.

" Virgin Active also has an increasing reliance on real-time systems for operational processes so a robust, reliable, secure and speedy network is essential to its success," the telco added.

In May C&W won a four-year contract to provide Virgin Media with wholesale broadband services, becoming the media group's exclusive local loop unbundling (LLU) provider through 2011.

"We're a complex business, made up of a diverse number of different companies each with very specific requirements – Cable & Wireless gets this," commented Gareth Lewis, CIO, Virgin Group.

Cable & Wireless has been providing various parts of the Virgin Group with hosting, security and contact centre services for the last seven years.

Reuters in £500m deal with Fujitsu

2007-08-16T14:13:00.000+01:00

Reuters has signed a £500m global deal with Fujitsu that will see the news and financial information group outsource almost its entire internal IT department to the Japanese company. Under the 10-year contract, Fujitsu will provide IT services for Reuters' 17,500 employees and contractors in over 100 countries.

More than 300 Reuters staff and 200 contractors will transfer to Fujitsu as part of the deal, which Reuters hopes will save it as much as £150m over the period.

Just 25 people will be left on Reuters' IT payroll under the contract, which has been planned for 18 months and will consolidate some of the company's existing IT contracts.

David Lister, Reuters' chief information officer, said the deal had been approved before Reuters' recent £8.75bn takeover by Canada's Thomson but that there would be ''opportunities to leverage'' the relationship with Fujitsu across the enlarged group. No job losses are planned.

''Reuters has built its business by acquiring different companies, which means, for instance, that journalists might currently need to access four or five different systems, which they may not be able to do remotely.''

Reuters said Fujitsu's upgrades would allow a reporter to access all of the systems whether they were at a computer at home, in the office, or an internet cafe in Baghdad.

Likewise, a Reuters salesman in Los Angeles could find themselves calling one of Fujitsu's IT call centres in Lisbon or Kuala Lumpur if they had desktop computer problems.

Savings will partly come from Fujitsu hosting the new IT infrastructure, allowing Reuters to get rid of kit such as on-site email servers.

David Courtley, chief executive of Fujitsu Services, said he did not anticipate problems with unions when transferring staff. "We think there is a very good future in Fujitsu for the Reuters people we are inheriting, but nor is there a requirement particularly for them to relocate in any sort of dramatic way.'

Fujitsu's existing IT outsourcing clients include Lloyds TSB, Her Majesty's Revenue & Customs and the DVLA.

Sony threatens to evict naughty gamers from Home

2007-08-16T08:31:00.000+01:00

Woe-betide any gamer looking to cause a nuisance on the forthcoming PS3 Home entertainment network, because Sony’s got its eye on you. The company has announced that it will not hesitate in banning any such gamers and their machines from the service.

For anyone not in the know, the PlayStation 3 Home environment has previously been described by Sony executives as a 3D virtual world inhabited by user created Avatars. It is expected to go live during October.

However, a Sony executive, speaking at the Edinburgh Interactive Festival, has said that serious abusers of the service would soon find themselves locked out by the company.

The executive claimed that “ultimately we know a user's details, we know machine details and we know where they live. If you really, really misbehave you can have your console disconnected at a machine level, so you would actually have to move house and buy a new PS3 before you could get online again”.

He stressed that Sony didn’t want to become a virtual police force for the network, but said it would create age-restriction areas within it to keep younger gamers locked out of any inappropriate content. The intention is for Home to be a self-policing network, by granting players the ability to block interactions with any other users as they wish.

Case Study: Rural Broadband Providers Look Skyward

2007-08-15T10:48:00.000+01:00

Rural Broadband Providers Look Skyward; Companies such as Hughes Communications are launching satellites in an effort to reach millions of people without high-speed Internet connections.

Just after nightfall on Aug. 14, a new state-of-the-art satellite owned by Hughes Communications (HUGH) will blast off from Kourou, French Guiana, into an orbit more than 22,000 miles above earth. The satellite, Spaceway 3, is part of the company's bid to reach a bigger slice of a sizable but untapped U.S. broadband market that remains beyond the reach of cable or DSL Internet service providers. For years, as major telecom and cable operators such as Comcast (CMCSA), AT&T (T), Verizon Communications (VZ), and Time Warner (TWX) have rolled out a bevy of new bundled telephone and Internet packages for urban centers, many rural regions languished with dial-up access as just about the only option for Internet access. For the most part, investments in the hinterlands bear considerable risks: Absent the economies of scale that come with densely packed customers, providers are forced to hope that their services are widely adopted. If not, such investments may never pay off.

That leaves a potentially huge market without high-speed Internet access. Hughes Chief Executive Pradman Kaul estimates there may be as many as 15 million homes and small businesses in areas deemed too remote for cable modem or DSL connections. With a current subscriber base numbering about 353,000, that leaves plenty of room for Hughes to grow.

Hughes' launch follows less than a year after its chief competitor, WildBlue Communications, launched its own new satellite. Like Hughes, WildBlue had been leasing space on another satellite, but since it launched its own last December, it has seen subscriptions grow briskly, CEO David Leonard says. WildBlue, based in Greenwood Village, Colo., has added 1,000 to 1,500 new users weekly since the satellite became operational in March, says Leonard.

Of those households and businesses without access to DSL or cable Internet services, Hughes and WildBlue serve only a tiny fraction of that market: Hughes had about 353,000 subscribers at the end of June, and WildBlue has between 225,000 and 235,000. By Kaul's reckoning, there is more than enough room for both companies to grow without crowding each other: "If we each get a couple million subscribers, we'll both be very happy campers."

The size of this untapped market may be a boon to Hughes and WildBlue, but it exposes a trend that some analysts believe portends ill for the U.S.'s global competitiveness. While the U.S. boasts more than 58 million broadband users -- more than any other nation -- it trails many smaller countries in penetration, according to a study performed last December by the Organization for Economic Cooperation & Development [OECD]. For example: Denmark, first in the world in per-capita broadband use, boasts 31.9 subscribers per 100 residents, while the U.S. ranks 15th behind Iceland, Belgium, and Luxembourg, among others, with 19.6 users per 100 people.

There are other technologies in the works, like wide-area wireless networks -- known as WiMAX -- or broadband delivered over power lines, that could make a difference for underserved parts of the country. But both Kaul and Leonard say they don't consider either technology a near-term threat to their satellite ambitions. Neither does Christopher Baugh, an analyst with Northern Sky Research, a telecommunications consultancy in Cambridge, Mass. The truly rural customers that Hughes and WildBlue are targeting are still beyond the grasp of both entrants. "WiMAX won't touch that market for another five years or so," Baugh says.

It's easy to see why Hughes, through its HughesNet brand, and WildBlue, partnered with AT&T or under its own name, are focused on rural areas. For one, urban and suburban customers pay less for DSL or cable Internet than their country cousins must for satellite. Verizon DSL, for example, costs $14.99 per month for the first year of service, while WildBlue costs $49.95 per month and HughesNet is $59.99. But in the places Hughes and WildBlue are targeting, the only alternative often is a dial-up modem.

But as urban areas continue to expand into areas where farms and forests once dominated, the number of customers beyond the reach of cable or DSL is also shrinking. Asked if he thought Kaul and Leonard's estimates of the size of the potential market for satellite Internet were accurate, Northern Sky's Baugh demurred. "I'd err more on the 10 million side," he said, noting that a few years ago such estimates were considerably higher.
Slow Speeds

In addition to reaching the underserved, Hughes says its Spaceway 3 will also help address some of the more common customer-service complaints that have plagued satellite Internet. Chief among those complaints are service interruptions caused by bad weather, sluggish downloads and browsing, and restrictions on heavy bandwidth usage. Speed is an issue because satellite signals must travel from the user's dish to space and back before, say, a Web page can be displayed. "In a direct competition with DSL or cable, satellite can't touch them," Baugh says.

Yet because Spaceway 3 will carry a router on-board, some of the lag time between a customer requesting a Web page and its appearance on his browser screen should be reduced, says Arunas Slekys, the company's vice-president of corporate marketing. And because the satellite will be able to retarget its coverage areas to accommodate demand, users with heavy bandwidth needs will be less likely to find their connectivity throttled back in response. "We will give consumers more bits at higher speeds than they're getting today," Slekys says.
High Expectations

Growth in Hughes' consumer and small-business operations helped power the company to a strong second quarter. The company said in its quarterly earnings report on Aug. 10 that it added 30,000 new broadband subscribers between April and June and saw revenue grow by 17%. Wall Street pushed Hughes shares 4.5% higher on the news.

The Hughes satellite is scheduled to become fully operational in the first quarter of next year. "I think by the end of 2008 we should start to see an impact on our numbers," Kaul says. And the added capacity from Spaceway 3 will allow Hughes to pursue new customers more aggressively, Kaul says: The company already is planning for its next satellite. Spaceway 3 is Hughes' first new satellite since News Corp. (NWS) sold its stake in the company to private equity group Apollo Management, taking its DirecTV satellite television business and the Spaceway 1 and 2 satellites with it. [News Corp. eventually sold DirecTV to Liberty Media in exchange for Liberty's News Corp. stake.]

WildBlue's Leonard says his company is also looking ahead to its next satellite launch. He expects WildBlue will reach 750,000 subscribers in the next few years, requiring further capacity. "That falls in the timeline to deploy another satellite," he says.

Microsoft shakes up online services arm

2007-08-15T10:45:00.000+01:00

Microsoft yesterday shook up the organisation and management of its online services business following its $6bn purchase of advertising services company Aquantive, marking its latest attempt to catch up with Google and Yahoo. The overhaul included a new organisational structure that closely resembles one that had been planned at Yahoo by Terry Semel, its former chief executive officer, although Yahoo has since turned its back on the arrangement.

Microsoft said it had split the management of its online services business, giving control of all its advertising activities to Brian McAndrews, the former chief executive of Aquantive. Advertising had previously been overseen at Microsoft by Steve Berkowitz, the executive in charge of its internet group, who will now head only the part of the business that is responsible for attracting the company's online audience.

The split between advertising and audience groups would create a clear division of responsibilities that would let both sides focus more clearly, said Mr McAndrews, adding: 'It makes perfect sense to me.'

Yahoo recently abandoned a similar plan after naming Jerry Yang as its new chief executive, saying at the time that it was unnecessary.

Mr McAndrews' appointment also marks the arrival of an injection of new blood designed to make Microsoft more than an also-ran in the advertising business. The senior management team for Microsoft's new advertising group is made up of former Aquantive executives, with the exception of Satya Nadella, who will be responsible for the advertising technology platform.

Yusuf Mehdi, Microsoft's former chief advertising strategist, had been appointed to a new role as senior vice-president in charge of strategic partnerships for the company's broader platforms and services division, Microsoft said.

Integrating Microsoft's AdCenter search engine advertising business into the other Aquantive online operations would position the new division for the changes that now are likely in online advertising, said Mr McAndrews.

While the growth of search had been the big trend in the first part of the decade, he said, advertisers were now interested in a broader mix of display, rich media and web video, and search was set to take its place in these more integrated online campaigns.

DirecTV to Offer High-Speed Internet From Current Group on Power Grid

2007-08-15T10:44:00.000+01:00

Satellite-television provider DirecTV Group Inc. is expected to announce a wholesale agreement today with Current Group LLC to provide high-speed Internet service over electric-power lines.
Under the agreement, DirecTV will market a bundled package of Current's broadband and voice over Internet protocol, or Voip, services under the DirecTV brand. The satellite-TV company also resells high-speed Internet services from AT&T Inc., Verizon Communications Inc. and Qwest Communications International Inc. under those phone companies' brands.

Broadband over power line is a new technology that allows customers to plug a modem device the size of a cellphone into an electric outlet and connect a cable from their computer for Internet access that is capable of speeds that are faster than some popular Internet plans from cable and phone companies. Current is building out broadband networks in Cincinnati and Dallas-Fort Worth and is in talks with a number of utilities around the world about a commercial rollout.

The new DirecTV broadband and Voip services will be available to residents in Dallas-Fort Worth area at the end of 2007 or beginning of 2008. DirecTV hasn't determined the pricing yet but says that the package of TV, Internet and phone services will be competitive, compared with those offered by phone companies.

Fujitsu's Tender Offer for France's GFI Ends in Failure

2007-08-15T10:42:00.000+01:00

Fujitsu Ltd. said Wednesday its tender offer for French information technology service firm GFI Informatique SA has ended in failure. In the tender offer that ran from July 2 to Aug. 8, Fujitsu Services, a wholly owned London-based unit of the Japanese computer maker, intended to acquire 66.67 pct or more of outstanding GFI shares at 8.5 euros each.

But the unit received sell offers for only 40.6 pct of the GFI shares, Fujitsu said.

The tender offer, aimed at reinforcing the Fujitsu group's IT services in Europe, drew opposition from both the management of employees of GFI.

Deutsche Telekom to cut 2,000 more jobs

2007-08-15T10:39:00.000+01:00

Deutsche Telekom , fresh from resolving a standoff with unions that had threatened the company's first major strike in a decade, could cut more jobs than the 32,000 already planned, a company spokeswoman said.

In response to a newspaper article that said the company planned to cut an extra 2,000 jobs, mainly at Deutsche Telekom's headquarters in Bonn, the spokeswoman said on Wednesday management was constantly seeking additional opportunities to cut costs. But she declined to comment on any specific number.

The Berliner Zeitung had cited company sources as the basis for its report on Wednesday that Europe's biggest telecoms group by sales planned to cut the extra 2,000 jobs by 2009.

Deutsche Telekom aims to cut up to 4.7 billion euros ($6.4 billion) in costs by 2010, including 2 billion this year, as it struggles with increased competition and a decline in its fixed-line business.

The Deutsche Telekom spokeswoman said about 20,000 of the 32,000 redundancies planned by the end of 2008 had already been achieved. Of the 32,000, 1,500 had been planned for the company's headquarters in Bonn.

"Changes in terms of efficiency have already been made since 2006, and we see the need for more such changes," she said.

Deutsche Telekom shares edged up 0.2 percent to 13.22 euros by 0802 GMT, outperforming a 0.8 percent weaker German blue-chip DAX index <.GDAXI>.

Deutsche Telekom said last week it was on track to achieve its 2007 financial targets but would not let up on efforts to cut costs.

"We are on the right track with our activities to become more competitive and keep our costs under control. However, we should not let this hide the fact that our journey is far from over," Chief Executive Rene Obermann said last week.

Lothar Schroeder, an executive of trade union Verdi and deputy chairman of Deutsche

Telekom's supervisory board, said the union had not been notified of any plans to cut more jobs.
"We knew that Deutsche Telekom was reviewing shared services, but this figure of 2,000, if it's true, is shocking, especially after the big conflict we just had with management," he told Reuters. "It brings renewed uncertainty into the company."

Deutsche Telekom and Verdi reached a deal in June allowing the company to move 50,000 staff into new, lower-paying service units in exchange for job guarantees, preventing a month-long selective strike from escalating.

Deutsche Telekom employs about a quarter of a million people worldwide, 180,000 of those in Germany.

Dr. Google and Dr. Microsoft

2007-08-15T10:29:00.000+01:00

In politics, every serious candidate for the White House has a health care plan. So too in business, where the two leading candidates for Web supremacy, Google and Microsoft, are working up their plans to improve the nation's health care. By combining better Internet search tools, the vast resources of the Web and online personal health records, both companies are betting they can enable people to make smarter choices about their health habits and medical care.

''What's behind this is the mass consumerization of health information,'' said Dr. David J. Brailer, the former health information technology coordinator in the Bush administration, who now heads a firm that invests in health ventures.

It is too soon to know whether either Google or Microsoft will make real headway. Health care, experts note, is a field where policy, regulation and entrenched interests tend to slow the pace of change, and technology companies have a history of losing patience.

And for most people, typing an ailment into a Web search engine is very different from entrusting a corporate titan with personal information about their health.

Google and Microsoft recognize the obstacles, and they concede that changing health care will take time. But the companies see the potential in attracting a large audience for health-related advertising and services. And both companies bring formidable advantages to the consumer market for such technology.

Microsoft's software animates more than 90 percent of all personal computers, while Google is the default starting point for most health searches. And people are increasingly turning to their computers and the Web for health information and advice. A Harris poll, published last month, found that 52 percent of adults sometimes or frequently go to the Web for health information, up from 29 percent in 2001.

If the efforts of the two big companies gain momentum over time, that promises to accelerate a shift in power to consumers in health care, just as Internet technology has done in other industries.

Today, about 20 percent of the nation's patient population have computerized records -- rather than paper ones -- and the Bush administration has pushed the health care industry to speed up the switch to electronic formats. But these records still tend to be controlled by doctors, hospitals or insurers. A patient moves to another state, for example, but the record usually stays.

The Google and Microsoft initiatives would give much more control to individuals, a trend many health experts see as inevitable. ''Patients will ultimately be the stewards of their own information,'' said John D. Halamka, a doctor and the chief information officer of the Harvard Medical School.

Already the Web is allowing people to take a more activist approach to health. According to the Harris survey, 58 percent of people who look online for health information discussed what they found with their doctors in the last year.

It is common these days, Dr. Halamka said, for a patient to come in carrying a pile of Web page printouts. ''The doctor is becoming a knowledge navigator,'' he said. ''In the future, health care will be a much more collaborative process between patients and doctors.''

Microsoft and Google are hoping this will lead people to seek more control over their own health records, using tools the companies will provide. Neither company will discuss their plans in detail. But Microsoft's consumer-oriented effort is scheduled to be announced this fall, while Google's has been delayed and will probably not be introduced until next year, according to people who have been briefed on the companies' plans.

A prototype of Google Health, which the company has shown to health professionals and advisers, makes the consumer focus clear. The welcome page reads, ''At Google, we feel patients should be in charge of their health information, and they should be able to grant their health care providers, family members, or whomever they choose, access to this information. Google Health was developed to meet this need.''

A presentation of screen images from the prototype -- which two people who received it showed to a reporter -- then has 17 other Web pages including a ''health profile'' for medications, conditions and allergies; a personalized ''health guide'' for suggested treatments, drug interactions and diet and exercise regimens; pages for receiving reminder messages to get prescription refills or visit a doctor; and directories of nearby doctors.

Google executives would not comment on the prototype, other than to say the company plans to experiment and see what people want. ''We'll make mistakes and it will be a long-range march,'' said Adam Bosworth, a vice president of engineering and leader of the health team. ''But it's also true that some of what we're doing is expensive, and for Google it's not.''

At Microsoft, the long-term goal is similarly ambitious. ''It will take grand scale to solve these problems like the data storage, software and networking needed to handle vast amounts of personal health and medical information,'' said Steve Shihadeh, general manager of Microsoft's health solutions group. ''So there are not many companies that can do this.''

This year, Microsoft bought a start-up, Medstory, whose search software is tailored for health information, and last year bought a company that makes software for retrieving and displaying patient information in hospitals. Microsoft software is already used in hospitals, clinical laboratories and doctors' offices, and, Mr. Shihadeh noted, the three most popular health record systems in doctors' offices are built with Microsoft software and programming tools.

Microsoft will not disclose its product plans, but according to people working with the company the consumer effort will include online offerings as well as software to find, retrieve and store personal health information on personal computers, cellphones and other kinds of digital devices -- perhaps even a wristwatch with wireless Internet links some day.

Mr. Shihadeh declined to discuss specifics, but said, ''We're building a broad consumer health platform, and we view this challenge as far bigger than a personal health record, which is just scratching the surface.''

Yet personal health records promise to be a thorny challenge for practical and privacy reasons. To be most useful, a consumer-controlled record would include medical and treatment records from doctors, hospitals, insurers and laboratories. Under federal law, people can request and receive their personal health data within 90 days. But the process is complicated, and the replies typically come on paper, as photocopies or faxes.

The efficient way would be for that data to be sent over the Internet into a person's digital health record. But that would require partnerships and trust between health care providers and insurers and the digital record-keepers.

Privacy concerns are another big obstacle, as both companies acknowledge. Most likely, they say, trust will build slowly, and the online records will include as much or as little personal information as users are comfortable divulging.

A person might start, for example, by typing in age, gender and a condition, like diabetes, as a way to find more personalized health information. If a person creates a personal health record and later has second thoughts, a simple mouse click should erase it. The promise, the companies say, will be complete consumer control.

There are plenty of competitors these days in online health records and information from start-ups like Revolution Health, headed by AOL's founder, Stephen M. Case, and thriving profit-makers led by WebMD.

Potential rivals are not underestimating the two technology giants. But the smaller companies have the advantage of being focused entirely on health, and some have been around for years. WebMD, for example, traces its lineage to Healtheon, a fallen star of the dot-com era, founded by the Netscape billionaire Jim Clark.

Google and Microsoft are great companies, said Wayne T. Gattinella, WebMD's chief executive, but ''that doesn't mean they will be expert in a specific area like health.''

Specialized health search engines -- notably Healthline -- are gaining ground and adding partners. AOL recently began using Healthline for searches on its health pages, even though Google is a close partner.

Still, 58 percent of people seeking health information online begin with a general search engine, according to a recent Jupiter Research report, and Google dominates the field. ''Google is the entry point for most health search, and that is a huge advantage,'' said Monique Levy, a Jupiter analyst.

Indeed, it is the market reach and deep pockets that Google and Microsoft can bring to consumer health information that intrigues medical experts, and has lured recruits. Dr. Roni Zeiger, a graduate of Stanford's School of Medicine, a medical informatics researcher and a former primary care doctor, joined Google last year. The 36-year-old, who still sees patients some evenings and weekends at a nearby clinic, said, ''At Google, I can use my expertise and knowledge to potentially help millions of people each day.''

Whose head should roll when mistakes are made? Four experts offer professional advice

2007-08-15T10:21:00.000+01:00

THE PROBLEM

Warren Spector recently resigned as head of capital markets at Bear Stearns following the collapse of two hedge funds at the US investment bank. In the space of a month, Peter Wuffli, UBS chief executive, was ousted; and Paul Corley, managing director of GMTV, the UK television company, resigned following the rigging of phone-in competitions.

When investors and the media are baying for blood, experienced managers may have to go in spite of having little involvement with the crisis. At other times, ousting a manager merely exacerbates a company's difficulties if they are seen as too junior to have made a difference. How can senior managers and the board judge the right level at which the sacrifice needs to be made, if at all?

THE ADVICE

THE ACADEMIC, Bill Fischer

Saint or sinner? The distinction can blur in fast-changing industries where huge rewards hang on being just a little more daring, faster and cleverer than the other fast, daring, clever guys. The speed of the day-to-day action and uniqueness of individual expertise involved make it difficult for senior management to be on top of every play. Instead, they must bet on individual performance and monitor decision processes - 'trust and verify'.

Warren Spector's oversight of both performance (asset management) and process (risk controls) at Bear Stearns may explain his forced resignation, despite the high regard inwhich he was held within the firm. In a very real sense, he was doubly exposed.

It is also an illustration of the lengths to which senior management will go to emphasise that it is still in control, despite appearances to the contrary. When high-profile crises go public, 'correction' is no longer the objective, and 'symbolism' becomes imperative. Managing external and internal perceptions becomes the new priority, despite the loss of expertise, the disruption incurred and the attendant risk of confusing symbols and scapegoats.

The writer is a professor at IMD

THE EXECUTIVE, Miles Templeman

First, think about the past performance of the individual. How well have they done? If they have contributed valuable ideas, won sales or played a vital team role, they will certainly be harder to lose. But are they likely to do as well in future?

Second, take soundings on how others will see the decision. What will be said in the City, by others in the industry and by your employees? If the axing is seen as a one-off that solves a widely recognised problem, it could be advantageous. If interpreted as scapegoating, it could simply postpone further - and potentially more painful - departures.

Much depends on the company's performance. If it is charging along apace, the crisis may be seen as a blip, requiring nothing more than the departure of the person immediately responsible - however junior. But a crisis that strikes a troubled group can trigger a wholesale senior management clear-out.

Third, consider the upside. Does a sacking give managers an opportunity to restructure or promote new talent? How rare are the skills of the person in question? If they are easily replaced, it could be a chance to bring in fresh thinking. Senior managers and the board should weigh all these factors - even where it casts doubt on their own position.

The writer is director-general of the Institute of Directors

THE PR GUY, Gay Collins

When facing a choice of sack, be sacked or do nothing, the question for chief executives is whether they can buy sufficient time to repair the damage. With solid board endorsement and a bold plan, the chief may be the right person to carry it off. However, he or she will have to convert the sceptics.

The sacrificial lamb approach staves off the disenchanted faster, but much depends on the recovery plan and who is brought in to replace the departing chief. If the crisis was caused by fundamental issues, a new broom may find it easier to make changes. If the issue was merely unfortunate then the winners are the headhunters and the losers are the shareholders, the former chief and management.

The worst scenario is when the leader stands his ground, the situation worsens and the board caves in and makes the chop. The share price rarely recovers and the reputational cost to the company is limitless.

The writer is managing director of Penrose Financial

THE CONSULTANT, Rich D'Amaro

The contemporary C-suite often resembles a high-stakes game of tag. To be sure, some leaders are ousted 'for cause', but all face a variety of newly heightened pressures: tightened regulations, volatile economic conditions, audit committee demands, board and investor scrutiny, peer-group pressures and increased liability of ethical lapses.

Still, the law of unintended consequences holds sway. Premature dismissal of a C-level executive can create more problems than it solves, especially when it only serves to disguise the weaknesses that led to failure in the first place. Sometimes regime change is the best option. But could things be fixed by modifying a product portfolio, beefing up sales and marketing, or injecting new capital?

A costly termination and executive search can hobble an organisation for months, even years. It is the board's duty not simply to fill posts with good candidates, but also to help ensure success.

That responsibility involves more than swinging an axe.

The writer is chairman and chief executive of Tatum LLC

Back office for the world

2007-08-15T10:19:00.000+01:00

This year, a rumour swept through the global stock markets that the information technology services outsourcing industry was about to witness the deal of the century. According to the speculation, Infosys Technologies, India's number two outsourcing group, was contemplating buying France's Capgemini, a deal that would for the first time combine the back office strengths of India with the front-end firepower of a western IT consulting giant. The rumours turned out apparently to be just that, baseless speculation. But the fact they were taken seriously at all is itself testament to the amazing achievements of India's IT services outsourcing industry.
From virtually zero little more than a decade ago, India has emerged as the global hub of the outsourcing industry. The sector has become in the process the most important driver of the country's economic emergence.

'There may be some people who claim they foresaw this happening,' says Lakshmi Narayanan, vice-chairman of Cognizant, theIT outsourcing company, and chairman of the National Association of Software and Services Companies (Nasscom), the sectoral industry body.

'But even when we started Cognizant, in 1994, we never thought that in 10 years we'd become a billion dollar company.'

India's IT outsourcing sector has its roots in the liberalisation of the telecom market in the early 1990s, which ushered in a new era of connectivity. Indian companies began to realise the potential of using the country's large pool of highly educated English language speakers as a back office for the outside world.

But it was not until 1997-1998, when the world began relying on India to prepare its computer systems for the millennium bug, that the industry came into its own.

This coincided with the frenzied deal-making of the technology bubble era, when Indian entrepreneurs began to emerge on the global stage, such as Sabeer Bhatia, who together with his partner Jack Smith sold hotmail.com to Microsoft in 1997.

Today the industry employs 1.6m people and handles everything from the IT functions of retailers such as J Sainsbury in the UK to the computer systems of chip manufacturers such as AMD. Indian companies now also take care of the back office paperwork of almost any type of foreign business or government department imaginable.

But as the industry has matured, so have the challenges, among them the supply of talent. Nasscom calculates the country is facing a shortfall of about 500,000 'skilled knowledge workers' by 2010 unless 'remedial action' is taken.

The shortage has led to wage inflation of between 10 and 15 per cent and higher for more experienced and specialised professionals.

The talent issue is so acute, Infosys, for example, is investing $300m in its own training centre in the southern city of Mysore.

'You have to see it in the context of growth,' says Nandan Nilekani, executive chairman of Infosys. 'It took 30 years for this industry to go from zero to $30bn, and when you look at all these numbers it implies that what took 30 years in the past, will take three years in the future.'

Then there is the physical infrastructure of India's choked cities, such as Bangalore and Mumbai.
'Infrastructure growth, in terms of the roads, power and the telecommunications that we are dependent on, while we are seeing some activity, it is not happening fast enough,' says Cognizant's Mr Narayanan.

More threatening, however, is a growing push by the global IT companies to match the Indian outsourcers at their own game.

These operators, such as IBM, Accenture, Capgemini and Electronic Data Systems, are setting up their own centres in India and at other low-cost locations around the world.

They possess what their much smaller Indian peers sorely lack - strong capabilities in higher-margin consulting. If they can come up to speed at offshore outsourcing, it could be checkmate for the Indian companies.

But even as the western companies are starting to look more Indian, so too the Indian outsourcers have begun to quietly change themselves to look more like the multinationals. India's biggest outsourcing group, Tata Consultancy Services, now has centres as far afield as China, Mexico and Morocco. Today about 9 per cent of its staff are non-Indian.

Mr Naryanan predicts that in the longer run, there will be consolidation, leading to five to 10 industry giants from India, Europe and the US. The common thread will be the importance of India in their operations. 'They will have development centres all over the place but with significant headcount in India.'

Mobile operators see 10 times more potential in social networking

2007-08-15T10:17:00.000+01:00

Mobile operators see 10 times more potential in social networking: Phone companies seek a share in the UGC boom Facebook is courted by a queue of networks.

The success of social networking sites such as Facebook, Bebo and even YouTube could represent the next boom for the mobile phone operators. Revenues from putting so-called user generated content - meaning content such as videos and blogs created by consumers rather than media organisations - onto mobile phones, is expected to rise more than tenfold over the next five years, according to estimates by Juniper Research published yesterday.

Allowing the legion of bloggers, Facebook posters and comedy clip makers, upload and view each other's every movement on their mobile phone could be worth $5.74bn (GBP 2.87bn) by 2012, according to Juniper, from just $576m this year.

"One of the most attractive elements of social networking on a mobile phone is that it's universally accessible so people can look up their friends, update their status or whatever on the move, which for the young demographic is particularly appealing," according to the study's author Dr Windsor Holden.

Social networking has become one of the fastest growing internet trends of the past two years. According to internet metrics firm Comscore, Facebook saw users increase 270% from June last year to June this year. It now has more than 52 million users worldwide. MySpace registered lower growth of 72% but still leads the market with 114 million users. Bebo, with a majority of users in Europe, grew 172% to more than 18 million users. The mobile phone companies reckon, the people who are using sites like Facebook are exactly the sort of people likely to be interested in using the internet on a mobile phone.

Further research by Comscore shows that people who are already experimenting with the internet on a mobile phone are younger than users who access the web only on a computer. In Britain, more than 25% of mobile internet users are aged 15 to 24, compared with 20% who go online using a computer; a further 41% of mobile internet users are 25 to 34 compared with less than 20% using a computer.

The concern for the mobile phone companies, however, has always been that offering the sort of flat-rate mobile internet access packages likely to lead to an explosion of usage, would leave them as little more than big dumb pipes in the air. Their worry has been that once they offer fixed rate packages, all they can compete on is price and over time they will end up as sidelined as internet service providers (ISPs) have become in the fixed line internet world.

Some mobile phone companies have tried to retain their position in the 'value chain' by setting up their own UGC services. For instance 3 has scored with its SeeMeTV portal, which lets users upload clips and share them with other 3 customers. SeeMeTV has also created its own social networking service called Moko (formerly Kink Kommunity) with users paying GBP 2.50 a month to keep in touch.

But Frederic Huet, director at Greenwich Consulting, says that the mobile operators have a real opportunity to persuade more customers to use their mobiles to access the internet by "mobilising" sites such as Facebook.

"I would not be too dismissive of data revenues, if the mobile operators can start increasing take-up of data services they will increase revenues for quite a few years before commoditisation and price competition sees those revenues erode again," he said. "By then the operators will be in a position to offer other services such as mobile advertising."

"The trick is to start building an audience now and the mobile phone operators are starting to understand that."

Sensing this opportunity, several mobile phone companies - such as T-Mobile, 3 and Vodafone in Britain - have launched flat-rate mobile internet tariffs.

Facebook, in fact, is already available on mobile phones in the US through the AT&T, Verizon and Sprint/Nextel networks, with users able to update their profiles and check on their friends. Several of the UK's mobile phone networks are understood to be eagerly chasing deals to add Facebook to their mobile web offerings. In addition, Vodafone has signed an exclusive deal to put YouTube clips on its mobile internet service.

Juniper Research's Dr Windsor, meanwhile, points out that the transition from social networking on the fixed line internet to the mobile internet could allow new entrants to muscle in.

One such new entrant is Itsmy.com, owned by German tech company Gofresh, which has already signed up over half a million users.

But these new entrants are going to have a real fight on their hands once people can easily update their Facebook status to "I'm on the train" using their mobile.

VMware leaps 75% on debut as investors seek the 'new Google'

2007-08-15T10:14:00.000+01:00

Shares in VMware, the software company, soared 75 per cent on their debut on the New York Stock Exchange yesterday as investors rushed for the most hotly-anticipated technology offering since Google. The shares rose well above their $29 offer price, the high end of expectations, briefly trading as high as $55 before falling back to $50.75 by midday.

The gains put the company on track to deliver the biggest opening-day gain for an IPO this year, an honour that belonged to asset manager Fortress Investment Group, which rose 67 per cent on its first day in February.

Sales at VMware have been growing at a breakneck pace amid strong demand for its software, which helps companies increase the efficiency of their computer systems by allowing multiple processes to run on a single computer server.

VMware's sales grew 95 per cent in the first quarter to $256m, putting the company on course to top $1bn in sales this year.

EMC, the data storage equipment company that bought VMware in 2004 for $635m, this year announced plans to float a 10 per cent stake in the company to unlock value for shareholders.

VMware's stock price yesterday implied an overall market capitalisation of just over $19bn, placing it just behind AdobeSystems and ahead of Symantec in a list of the world's biggest software companies. It is also ahead of Ford Motor's market capitalisation of $17bn.

'It is always difficult to know how the market is going to react, but this is certainly at the high end of our expectations,' said David Goulden, EMC's chief financial officer.

VMware, founded in 1998, has said it planned to use its $957m in IPO proceeds to fund a dividend to EMC and to buy a new corporate headquarters.

Diane Greene, VMware's co-founder and chief executive, said the company was looking forward to using its newly public shares as currency to make acquisitions and to reward its 3,000-or-so employees for its strong performance.

'For them to have equity that's pure VMware is a big deal,' she said. The company has granted 37m shares as options to employees, according to regulatoryfilings.

VMware sold a 2.5 per cent stake in the company to Intel, the world's biggest chipmaker, for $219m last month.

What Did Peter Moore Cost EA?

2007-07-19T14:08:00.000+01:00

Would you like to know exactly what Electronic Arts had to fork out to lure Peter Moore away from Microsoft? Well courtesy of a filing with the United States Securities and Exchange Commission, we have the details.EA were obliged to file a Form 8-K with the SEC on the same day that their press release announcing his hire as the President of EA Sports was released (17 July 2007). Here's the details:

Mr. Moore’s annual base salary will be $550,000 and his discretionary target bonus percentage will be 75% of his annual base salary. EA has agreed to pay Mr. Moore a one-time bonus of $1,500,000 (minus applicable taxes) in recognition of the future compensation value he would be foregoing by leaving his position at Microsoft. Although Mr. Moore will earn this one-time bonus at the completion of his second year of employment with EA, he will receive it within 30 days of starting employment. If Mr. Moore voluntarily leaves his employment with EA before the completion of two years, he has agreed to repay to EA the full net amount of the bonus.
EA has agreed to grant Mr. Moore a stock option to purchase 350,000 shares of the company’s common stock pursuant to EA’s 2000 Equity Incentive Plan. The stock option will vest as to 24% of the shares twelve months from the first day of the month in which the grant is made, and will then vest in additional 2% increments each month thereafter for the following 38 months.
EA has agreed to grant Mr. Moore 50,000 restricted stock units, which vest as to 50% of the shares on the second anniversary of the grant date, and as to the remaining shares on the fourth anniversary of the grant date.
EA will assist Mr. Moore with relocation-related expenses, which are currently estimated to be approximately $330,000. In the event Mr. Moore voluntarily leaves his employment with EA or is terminated for any reason other than a reduction in force that eliminates his job position (a) prior to the one-year anniversary of his date of hire, he has agreed to pay EA an amount equal to all relocation and gross-up expenses incurred by EA through the date of his termination; or (b) on or after the one-year anniversary of his date of hire and prior to the second anniversary of his date of hire, he has agreed to pay EA an amount equal to a pro-rata portion (24 minus number of full months of employment / 24 months) of all relocation and gross-up expenses incurred by EA through his date of termination.

Web radio faces its death knell

2007-07-19T10:29:00.000+01:00

Small internet radio stations face being wiped out by a change in the way royalties are calculated. But stay tuned - the fight is far from over, says Danny Bradbury: How the numbers add up: ≥ Web radio faces its death knelll

Tim Westergren never thought he'd run a dotcom startup. He was a musician, sleeping in tour vans on the road and recording the occasional film score. When he did decide to start a business, he put six years of his life into it. This week, he is preparing to shut down his nascent UK operation and mulling the future of the US one, as legislators on both sides of the Atlantic threaten to kill his business. Westergren founded Pandora, an online streaming music service based in California that lets people build personalised stations. A ruling by the US Copyright Royalty Board that technically came into force last Sunday at least tripled the royalties that Pandora and other internet radio companies pay. A day later, the UK Copyright Tribunal unveiled its own royalty charges that made his business in the UK untenable and left other large webcasters fuming.

Retrospective royalties

Outraged appeals from the net radio industry failed to overturn the US ruling, which applies retrospectively from January last year. As of this week, Westergren and others are in hock to royalty collector SoundExchange for unpaid record label royalties. Under the ruling, the royalty rate will rise each year until 2010. But Pandora could be gone long before that. "In the face of those rates, we can't carry on," says Westergren.

Music has two copyright holders. The publisher or composer holds the rights to the lyrics and the melody, while the record label or performer holds the rights to the sound recording. Radio stations have historically paid royalties for the musical work to the publishers but not for performance rights.
This was a sore point for the labels, which finally won the right to charge for performance rights over internet radio in 1998. The US government created a statutory licence under which webcasters would pay a set fee to the labels for performance rights. In 2002, the Small Webcasters Settlement Act created a haven of sorts for webcasters with revenues of less than $1.2m (GBP 589m) - who make up the bulk of the US's 30,000 webcasters. This restricted royalties to 12% of their income - even though terrestrial broadcasters with substantially greater revenues pay no performance royalties at all.

Nevertheless, webcasters and the labels had reached an uneasy peace - until the royalty board's ruling this March. That swept away the revenue-based royalty scheme for small webcasters, forcing them to pay a per-song royalty like every-one else. Smaller webcasters could find their royalty payments multiplying by up to 12 times, says SaveNetRadio.org.

The board also approved a minimum charge of $500 per internet radio station, which would be
disastrous for those webcasters who create personalised channels for each listener. Every time a user creates a channel in Pandora - and many users have more than one - Westergren would have to make another payment. "90% of the internet radio stations in the US will go out of business," warns David Van Dyke of analyst Bridge Ratings.

"Our goal is to continue to grow with internet radio," says John Simson of Sound Exchange, which set up four years ago by the Recording Industry Association of America (RIAA) to collect performance royalties. "We want to help our members to get value for the music being used."
But the labels benefit from internet radio's promotional role, protests Kurt Hanson of Accu-Radio, a small webcaster. "Net radio is one of the few good things the record industry has going for it," he says. "It's giving airplay is to thousands of artists that have never been able to get airplay before."
But something is bugging SoundExchange, and falling CD sales is probably it. CD sales fell 15% in the first half this year compared to the same time last year, according to Nielsen SoundScan, and that's an ongoing trend, says Van Dyke.

Falling CD sales are causing the labels to push for revenue from play services rather than product sales, suggests Bob Hamilton, who owns radio analyst New Radio Star. But he suspects that they were surprised when no one pushed back. "SoundExchange bought in a proposal so high and ridiculous believing they'd have to negotiate," he says. "I think they were shocked at what they got."

This might explain why SoundExchange offered three separate compromises to the industry in the weeks following the ruling. It extended the conditions of the Small Webcaster Settlement Act until 2010, in effect nixing the increased royalty payments for small webcasters. Second, it offered to cap the per-station radio fee at $2,500 per station. Last Thursday it increased that offer to a maximum of $50,000 in per-station payments per webcaster. That offer applies only if webcasters work to avoid listeners recording music streams, which hints at the use of digital rights management technology.

But now the webcasters want a better deal, and they're trying to renegotiate the Small Webcaster Settlement Act. "It says that if you make more than $1.2m, your royalty payments go through the roof and you risk bankruptcy," says Jake Ward of SaveNetRadio.org.

Simson protests that most webcasters are far below the $1.2m ceiling, and Ward admits that ad
revenues are low. However, they are growing. Ad revenues for internet radio grew by two-thirds to $66m in the US this year and will reach $104m next year, says Bridge Ratings.

Meanwhile, representatives are trying to push the Internet Radio Equality Act through Congress. This would fix performance-based royalties at 7.5% per year, which is more in line with what satellite radio providers like XM and Sirius pay.

Limited options

If webcasters lose their battle, the options are limited. "We would move outside the US, probably," says Bill Goldsmith of small webcaster Radio Paradise. Another option is more ominous: Hanson believes that webcasters might cut direct deals with the labels. The labels would offer cheaper licences, he says, but those could come with a caveat: encroaching control of the stations' playlists.

New Radio Star's Hamilton says that many of the larger web stations have already cut deals with the labels, although because these deals are private there is no way of knowing what the terms are. In the UK, where performance licencing is more complex, direct deals are commonplace. UK-based Last.fm has signed deals with EMI, Warner and Sony BMG for access to their catalogues.

Internet radio didn't die on Sunday when the ruling came into effect. SoundExchange left the Small Webcaster's Settlement Act in place, so little will change for them as they thrash out the deal's terms. The 20 or so large webcasters are technically expected to comply from this week, but Simson has left the door open for an ongoing discussion with them. For the time being, companies like Pandora "aren't likely to be charged immediately", he says.

But the UK ruling, announced on Monday and effective from July 1, creates a new problem. In addition to a percentage of total revenue, for every track they play webcasters will have to pay a minimum charge which is nine times higher than the US royalty board's projected per-track rate for 2010.

The terms were originally agreed last September, in a royalty settlement between record companies and parties including mobile phone operators, music download companies and the MCPS-PRS Alliance, which collects music royalties for publishers. Three webcasters - AOL, Real Networks and Yahoo! - failed to settle.

Now, webcasters face a war with regulators on both sides of the Atlantic. Very large webcasters may be able to stomach the fees, but Pandora is preparing to shut its service in the UK - the only country served outside the US - as early as this week, says international managing director Paul Brown. The service, which had been offered informally while Pandora negotiated UK music licensing deals, was to formally launch by the end of the year, but it could never be profitable under the new rules, he says.

"We want to bring this good service to the UK, but it has to be on an economic base and if you're losing money for every hour then there's no business there," laments Brown. For Pandora UK at least, it turns out that Monday really was the day the music died.

Tim Westergren of Pandora says that says that his radio station 'can't carry on'

$104m - The prediction for next year's ad revenues for internet radio in the US
30,000 - The number of webcasters in the US, most of whom count as 'small'
12% - The maximum percentage of revenues that small webcasters paid as royalties
≥2 - 'Our goal is to continue to grow with net radio. We want to help our members to get value for the music'

Free food, free car, and even free beer ..and the boss says it's OK to play video Games. No wonder everyone wants to work for PERKPLACE

2007-07-19T10:25:00.000+01:00

You've just come back from a game of beach volleyball followed by a fine Italian lunch.
This afternoon you've organised a "brain break" with your pals over a game of pool.
Then, before catching the free luxury bus home, you might have a quick dip in the pool. Or, as it's Friday, why not catch a live band and sink a free beer or two?
No, this isn't a a five-star luxury resort. It's just another day at the office for the lucky staff at internet giant Google.

The IT megastar's sprawling head office occupies more than three million square feet in San Francisco's Silicon Valley, California. And it's not only the scale that impresses.
Company perks include a choice of 15 upmarket restaurants serving complimentary cuisine around the clock, two swimming pools, a volleyball court, pool tables and an on-site gaming arcade. And we haven't even mentioned the massages...

Within moments of entering, it's easy to see why more than 100 people fight to be inducted as Googlers every week - almost doubling the workforce from under 7,000 a year ago to more than 12,000 today.

In the reception areas, fridges dispense unlimited pricey smoothies to guests. And they're just a taste of the goodies to come. "Google feels strongly that the space belongs to the employees," says global communications and public affairs manager Sunny Gettinger. "The company encourages us to make the offices our own."

Not that they need much encouragement. In one building, blown-up snaps of staffers' families are projected on to a wall. And bumping into workers' dogs - and children - is commonplace.
"If someone who works in your 'pod' has a dog allergy, then obviously you don't bring your mutt in," explains Sunny. "But most people love having the pets around."

It's anything but a dog's life for any creature lucky enough to cross the threshold of the Googleplex.

But then they are a rare breed. To flush out the brightest and the best, the company recruits by anonymously posting complex equations on billboards which, once solved, lead to the jobs website.

Other offbeat ruses to lure premier talent include a computer-coding competition and a brain-twisting aptitude test that mixes geek humour with a daunting mathematical workout. Still, it's nice work if you can get it.

Staff start and finish at times that suit them and after being transported to and from their homes in air-conditioned luxury Wifi-enabled buses, their perks just keep on coming.

As well as the restaurants - serving everything from tapas to tacos (and offering daily recommendations from a full-time nutritionist) - the software engineers, programmers, salespeople, admin and ancillary staff that populate Google can feast on snacks in dozens of "microkitchens".

Fancy some fruit (pre-washed for your convenience)? Probably not, with delicious cookies, nuts and candy never more than six strides away.

"The Google 20 has two meanings around here", Sunny says. "The company wants all staff to spend 20 per cent of their working hours on a project that has nothing to do with their day-to-day work.

"It can be totally out there, but as long as it's creative and could potentially help Google in some way, it's encouraged.

"The other meaning is that most people put on 20lbs in their first few months here, because the food is so amazing!"

The complex was reportedly designed by Google founders Sergey Brin and Larry Page - who started the £90billion giant just nine years ago - to ensure that no worker would be more than 150 feet from a food source.

"A lot of people like their M&Ms. But the easy access is actually what's bad for them," Sunny admits.

However, there's no excuse for those chocolate morsels to spend a lifetime on any Googlers' hips.

The Mountain View HQ is home to five free full-spec gyms with heavily-subsidised personal trainers.

Then there's the "beach" volleyball court, complete with imported sand, and the climbing wall. And don't forget to warm down afterwards with the £15-an-hour full body massages in the wellness centre.

Or perhaps you'll just take a scenic drive in one of the company's fleet of hybrid Toyota Prius cars offered free for day use for employees.

Even answering the call of nature is a joy. "The toilets are shipped in from Japan," says Sunny. "Happiness really is a heated toilet seat!"

So it's no wonder that Google recently won the coveted title of America's Best Company To Work For. After all, employees can get haircuts and free medical check-ups on-site, and they enjoy weekly "TGIF" (Thank Google It's Friday) afternoon sessions with live bands and free beer on tap.

There's annual ski trips for every member of the company (free, naturally) and regular invited speakers of the calibre of Mikhail Gorbachev and Presidential candidate Hillary Clinton.
And the subsidies! New parents get up to £250 to buy takeaways for the first four weeks of a new sprog's life.

Workers who cycle in collect "stamps" - every 20 times they arrive at work in their Lycra, Google pays £50 to a charity of their choice. And if you prefer four wheels you'll get £2,500 towards the cost of an environmentally-friendly car.

But Google's green credentials don't stop there. The company has recently unveiled the world's largest corporate solar-panel installation. Carpet across the campus is recycled and the tens of thousands of light bulbs are all energy-efficient - and ingeniously designed to mimic natural daylight.

The working environment is pretty healthy, too. "We're all about creativity," says vice-president Douglas Merrill.

"The space has been designed to ensure that you'll get people from totally different departments sitting next to each other at lunch or challenging each other to a chess game."

"You never know, the next great idea could come about while thinking about the next ball to pot during a game of pool," Sunny says. "And happy people work better."

British software engineer Bruno Bowden certainly isn't complaining.

"I always dreamed of working in Silicon Valley," he says. "But Google has surpassed all my expectations."

As I leave, I pass two staffers who, fresh from a yoga class, are debating whether to have Chinese or Italian for dinner.

"I haven't been to the supermarket since I joined six months ago," one remarks smugly.
Which just leaves one more question. Where do I send my application?

Google Facts:
The name is based on the figure googol - number 1 followed by 100 zeroes.

The site started life as a research project for Larry Page and Sergey Brin while students at Stanford University, California.

They launched Google from a friend's garage in 1998, and are now billionaires.

Google-users can search in 36 languages, including Chinese, Hebrew and Klingon.

Users make more than 200 million searches a day, the site handles 60 per cent of web searches.

BT thinking 'quite far' advanced on case for ultra-fast broadband

2007-07-19T10:22:00.000+01:00

BT is considering the case for an ultra-fast broadband network that could deliver internet download speeds of up to 50 mega bits per second. Sir Christopher Bland, the BT chairman who stands down in September, said the company was looking at whether to install fibre optic cable as far as the street kerb, where BT phone line cabinets are found.

The roll-out of fibre relatively close to homes and businesses could deliver download speeds of 40-50 mbps, according to BT, compared with the 8 mbps most telecoms companies offer.

Investors are nervous about BT making any commitment to an ultra-fast broadband network because of the likely capital expenditure, which some analysts have estimated at GBP 4bn.

BT has said there is no economic case for taking fibre all the way to homes because of the cost involved. But Sir Christopher said BT's thinking had advanced 'quite far' on the case for fibre to the kerb.

'That is the more likely development going forward,' he said, while stressing no decisions had been taken.

BT is planning to offer speeds of up to 24 mbps from next year, as it rolls out a GBP 10bn 'backbone' network and introduces technology known as ADSL2+.

Sir Christopher questioned whether 'most consumers' would need speeds of more than 16 or 24 mbps, but accepted some businesses might. He said any fibre roll-out would be in 'selected areas'.

The Broadband Stakeholder Group, a government advisory panel, claimed in April that the BT network would be too slow to meet the demands of the most bandwidth hungry by 2012. It said ministers and regulators had two years to find ways to encourage investment in high speed broadband or UK competitiveness would suffer.

BBC shame over deception

2007-07-19T10:12:00.000+01:00

The BBC faced a grave crisis of public trust last night after admitting that a series of flagship children's and charity phone-in programmes had deliberately deceived viewers. Children in Need, Comic Relief and Sport Relief all featured fake competition winners, the corporation said.

An internal investigation, ordered after the BBC's apology to the Queen last week, also disclosed serious breaches of editorial standards involving a series of other phone-in shows. In some instances production staff posed as competition winners.

After the scale of the deceptions became clear, Mark Thompson, the director-general, immediately suspended all phone-related competitions on television and radio. Interactive and online competitions were also halted.

The inquiry identified cheating on six television and radio programmes. The audit - of a million hours of output since January 2005 - followed the row over a BBC1 trailer that wrongly implied that the Queen stormed out of a sitting with the photographer Annie Leibovitz.

Mr Thompson presented the inquiry's findings at a meeting with the BBC Trust, the corporation's governing body, which had demanded an explanation over the royal fiasco.

The trust called the editorial breaches "deeply disappointing'' and ordered an immediate investigation.

A number of executives face suspension over the deceptions. Mr Thompson last night warned that dismissals were inevitable.

The BBC has also decided not to commission any new programmes from RDF, the production company whose incorrectly edited trailer of the documentary about the Queen appeared to show her walking out of the Leibovitz photographic session in a "huff''. The company has been dropped until the result of a separate inquiry into the misrepresentation of the Queen is completed in the autumn.

The six new cheating cases follow the GBP 50,000 fine imposed on the BBC last week after Blue Peter faked a competition. The watchdog Ofcom criticised the programme for making a young studio visitor "complicit'' in the deception by asking her to pose as a winner.

In a sign of the panic pervading the corporation, it announced an unprecedented staff training programme that would focus on issues of "honesty'' with the audience. All 16,500 programmes and content employees will attend the mandatory training programme "Safeguarding Trust''.
The disclosures came as Ofcom criticised television broadcasters for a "systemic failure'' in operating premium rate phone services. Ofcom said last night that the BBC's "significant failures of control and compliance'' raised "serious questions'' and asked for further information.

After briefing the trust on the scale of the dishonesty, a shaken Mr Thompson said: "There is no excuse for deception. We have to regard the deception as a very grave breach of discipline which will normally lead to dismissal.

"Deceiving the public is utterly unacceptable, it is a gross breach of discipline. We have to get our house in order.'' Challenged over whether he would resign, he said: "My task is not to think about my own position but to roll up my sleeves with the rest of the BBC and make sure we sort this out.''

A senior BBC figure said: "It is hard to see how heads will not roll. It is just a question of how high up the executioner goes. This is shocking and serious . . . it will undermine the BBC's most precious commodity: trust.''

The BBC1 controller, Peter Fincham, already faced calls to resign over the royal fiasco and the new disclosures will increase pressure on him to go.

Mr Thompson told staff: "There is no excuse for deception. I know the idea of deceiving the public would simply never occur to most people in the BBC. If you have a choice between deception and a programme going off air, let the programme go.''

The fake winners were put on Comic Relief on BBC1 in March, TMi on CBBC in September 2006, and Sport Relief on BBC 1 in July 2006. On Children in Need in November 2005 on BBC1 Scotland a fictitious winner's details were broadcast because no telephone calls had got through from the public.

The Liz Kershaw Show on BBC 6 Music and White Label on the World Service were repeat offenders. Neither their competitions nor the prizes existed and all callers featured were members of the production team or their friends.

Jeremy Hunt, the Tory culture spokesman, said: "This is a grim day for the BBC. Mark Thompson has uncovered a hornets' nest of deception at what was Britain's most trusted broadcaster. The most worrying thing is the impact it will have on charitable giving, as many of the fake winners were in programmes raising money for good causes.

"Tough words are fine but the proof of the pudding is what actually changes.''

Michael Grade, the former chairman of the BBC who now heads ITV, said the fact that even Comic Relief had been implicated shows "how pernicious this erosion of ethics has been in the industry''.

The problem was made worse by the casualisation of employment and expansion of short-term contracts. Workers had "mortgages to pay'' and needed the next job or order.

BT chairman departs with pride in turnround

2007-07-19T10:04:00.000+01:00

Sir Christopher Bland will use his last annual meeting today as BT chairman to tell investors that while the UK's leading telecommunications company has made great progress on his watch, it still has much to do. In an interview with the Financial Times, Sir Christopher says his message to investors would be 'we have come a long way, but there is plenty more to come'.

He can look back with some satisfaction on his record as BT chairman since May 1 2001.

He arrived to find BTsuffocating under a GBP 30bn debt mountain, and clinging to outdated telecoms technology. He leaves in September, having played a leading role in BT becoming one of the better performing European telecoms companies.

Sir Christopher, 69, outlines three main achievements. First, the hiring of Ben Verwaayen, the chief executive; second, persuading BT to embrace broadband communication; third, developing a global capability to serve the telecoms and IT needs of large companies.

Sir Christopher and Mr Verwaayen have become one of the City's favourite double acts. They are chalk and cheese. Sir Christopher comes across as a rather grand individual, partly because of his dry sense of humour, which has resulted in some acerbic put downs for analysts and journalists.

He has held a variety of business and regulatory jobs, as well as advisory positions with the last Conservative government, but his most high-profile roles, previously, have been in broadcasting. Before BT, he was chairman of the BBC board of governors.

Mr Verwaayen is Dutch, and somewhat abrasive. Sir Christopher describes him as 'quirky'. He is steeped in the telecoms industry. Before joining BT in 2002, Mr Verwaayen held senior positions at Lucent Technologies, the US telecoms company.

Sir Christopher says he and Mr Verwaayen have 'complementary skills'. While the chairman knew 'instinctively' that BT had to embrace broadband, Mr Verwaayen could make it a reality.

They had to end the BT attitude towards broadband that amounted to telling customers 'you can have it if you really insist'. That existed because broadband threatened the company's revenue from the outdated ISDN technology.

The huge subsequent expansion of broadband pleased ministers and regulators.
But BT's relationship with Ofcom, the telecoms watchdog, was transformed by an agreement in 2005 that the company would create a subsidiary giving rivals access to its network.

Rivals had long complained about inadequate access, so BT last year set up Openreach, which
gives them control of landlines running from the company's phone exchanges to homes and offices.

Openreach's performance, however, has been criticised by Charles Dunstone, chief executive of Carphone Warehouse, and John Pluthero, chairman of Cable and Wireless' European business.

Sir Christopher insists Openreach has performed 'outstandingly', and des-cribes Mr Pluthero as a 'serial complainer'. He says Mr Dunstone's problems with his broadband business 'have been largely of his own making'.

Perhaps Sir Christopher's biggest gamble at BT was his willingness to stake the company's future on serving the telecoms and IT needs of multinationals.

Back in 2001, BT had a joint venture with AT&T, the US telecoms company, that supplied multinationals, but it generated an operating loss of Dollars 800m.

Sir Christopher says the collaboration, called Concert, was an 'epic disaster', and BT and AT&T decided to dismantle it.

But BT's board was persuaded by a senior executive to take remnants from Concert and make a second tilt at serving multinationals. Sir Christopher says the board took a 'big leap of faith', but
BT Global Services, as Concert's successor is known, is becoming the company's growth engine, alongside broadband.

He denies the development of BT Global Services was partly a response to how the company spun off its mobile phone business in 2001. BT's European peers rely heavily on their mobile operations for revenue growth and the demerger of BT Wireless had been set in train before Sir Christopher joined the company.

Before his final interview for the chairman's position, he asked for six months to consider the case for demerger, but was instead given a few days. He says 'on balance' the demerger was correct, and highlights how regulators would not let BT offer combined fixed-line and mobile phone deals.

Improving the margin on BT Global Services' earnings before interest, tax, depreciation and amortisation is one of several challenges facing the company.

Sir Christopher expresses confidence that a 15 per cent margin target will be hit by 2009-10, even though BT Global Services' main rivals, AT&T and Verizon, are stepping up their efforts to win business.

The other glaring challenges are improving customer service and expanding BT Vision, the company's fledgling television service.

'I am leaving the ship but the ship is still firing on, and there is a long journey ahead, as well as behind,' he says.

The enemy at the cyber-gates

2007-07-18T09:52:00.000+01:00

The internet provides an open market for trade in malicious software. Dan Ilett finds out who the hackers are, what they do and what businesses can do to keep them at bay Research in all areas of the security industry suggests that the supply of data-stealing products and services is growing.

Economic signals indicate productivity and returns are high for criminal hackers. For instance, in the UK recorded online banking fraud increased from £23.2m in 2005 to £33.5m in 2006, according to Apacs, the UK payments association.

Hackers and those after their services have found the internet to be the perfect trading floor. Hacking expert John Safa, CTO at security company DriveSentry, says that through forums and other communication services, the internet plays host to a thriving hacker community.

"Most of these guys [hackers] are about 30 and are talented programmers who want some more money. They would be paid to develop code. This could be posted on malware forums. Then they talk via IRC [Internet Relay Chat] and people will advertise," says Safa.

"You can tell by the way they talk they have had a busy day at work. The kids are open about hacking. The older ones are discreet. There are two ways to get involved - someone can approach you and ask you to break into something. Or organised crime may ask 'can you develop me some ransomware'"

But it is not just criminal organisations that can access malware. The internet provides an open market for these services, says Graham Cluley, senior technology consultant at anti-virus company Sophos. "When it comes to things like spyware, you can buy these things on the web. These tools are free for anyone to purchase - it is easy to get them."

He adds, "The most obvious threat is spam. There is advanced fee fraud such as 419 scams that are still working."

Spam accounts for up to 90% of e-mail traffic, estimates e-mail security firm SoftScan. Although laws, such as Australia's policy to fine spammers £10,500 a day, are slowly catching up with the fight against spam, it is just the tip of the iceberg.

One problem is that spamming is becoming more sophisticated. Like the rest of the technology industry, hackers have embraced convergence. Spam is now often sent from compromised computers, known as botnets, which are used for extortion attacks, but are created by malware made by hackers.

An entire trade exists in making malware, such as backdoor and password-stealing Trojan horse programs that log keystrokes from hijacked PCs.

A Trojan infrastructure with support services can be purchased for £500. Phishing kits cost £100-£150, and for £500 you can buy a universal kit to target any financial institution, according to research from security firm RSA.

One hacker, called "0x80", earns almost £3,500 a month from sending spam through self-made botnets, the Washington Post reported last year.

And unlike three years ago when malware was designed to simply make a mess of the internet, hackers are now producing malware that tends to have two purposes: to steal data and to connect an infected computer to a botnet.

Many companies are failing to react to the changing threat, says Roger Thompson, CTO at online security firm Exploit Prevention Labs. "Companies are not understanding this at all. They think they are protected by anti-virus software and a firewall. But people have got to be patched or run anti-exploit software. The trouble with web browsing is that it pokes a hole through the web browser," he says.

Security companies have also started to find that a higher proportion of intercepted attacks are targeted attacks. E-mail security firm MessageLabshas seen a sharp rise in messages sent directly to senior management, addressed with names and job titles. Family members of these people were also said to be targeted as an indirect way for hackers to get information on companies.

Botnets are at the heart of a large portion of criminal hacking cases. For this reason, US police last month began the enormous task of telling one million people their computers are under hacker control. The FBI launched the initiative, Operation Botroast, in a bid to reduce the high number of PCs hijacked and networked together for criminal use.

Thompson says these attacks tend to originate from two key bases. "The Russians are still very prominent in this. They have good waves of attacks at the moment. The other group is Chinese-based - and it is not just one gang, but a bunch.

"They are trying to get user IDs, passwords and financials. In the case of China, it is kids because they are mostly interested in online game passwords for virtual gold. With the Russians, it is organised crime for cash," he says.

However, the source of botnet attacks is not just limited to China and Russia. In the US, 21-year-old Jeanson James Ancheta was jailed for almost five years in May 2006 for hijacking 400,000 computers. Ancheta earned commission from adverts he programmed to display on the hijacked computers, and rented the botnet to other hackers.

Simon Heron, managing director at security firm Network Box, says, "Ancheta claims to have had about 30 transactions for the use of his botnet for spam and other purposes. He also made money by installing adware. To do this he became an affiliate of different advertising service companies and those companies paid him based on how many installations he could do.

"In Ancheta's case he made a good living for six months, earning about £30,000 from adware and another £90,000 from hiring out his botnet. It was hardly a fortune, but then again he was only 20."

When hacking is exposed there can be valuable lessons for businesses. In 2005, hackers attempted to steal £220m from the London offices of the Japanese Sumitomo Bank. Rumours spread in the financial industry that it was a hardware keylogging device attached to a computer that gave thieves the data they thought necessary to make a clean getaway.

"Hardware keyloggers are tiny and keep track of the past few hundred keyboard sessions. Everything is dropped into a file. You need physical checks to protect this," says Cluley.

"It is much harder to get a grip on an internal threat. It is things that people can leak by instant messaging services or e-mail that are hard to police. Employees do know passwords."

The UK's Centre for the Protection of Critical National Infrastructure advises companies to screen contractors, cleaners and caterers to help protect against internal threats.

So how should companies approach their overall security "Defences have to be multifaceted and diverse. One strategy is making sure that defences exist within multiple levels of business and overlap as necessary," says Gunter Ollmann, director of security strategy for IBM Internet Security Systems.

"But perhaps the most important component is education. Having an understanding of how hackers do these things and what motivates them are key in reducing an organisation's risk profile."

Companies should look at web threats and implement some sort of real-time protection product, because chasing attacks after the event is always too late, says security company Finjan. It advises to keep IT products updated and patched, and to look out for malicious websites, where many of the new threats are coming from.

Companies must also be aware of the threats posed by Web 2.0 sites where hackers can approach naïve staff directly, says Safa. "A lot of the crime works through social engineering and the amount of people on instant messaging services or MySpace. It is exploiting the weaknesses of being able to communicate," he says.

What is critical is that companies recognise the threat from new technology and realise that as the way they work changes, the way they approach security must change. "Companies can no longer rely on traditional anti-virus suppliers to cater for their security needs. Do this and it is like going out in the sun without sunblock - you will get burnt," says Safa.

"Second, as workers become more and more mobile, organisations need to provide software that works in a secure environment. We have moved on from the one-size fits all approach."

He adds, "Combining people and process and monitoring what is coming in and going out of an organisation is the best way for firms to assess threats. You are always going to have the naïve employee opening every file or application that is sent to them. Automating the process by having black and white lists eases the pressure, but however much security technology evolves, hackers will always try and win."