May 23, 2010
(Fortune) -- If not for founder Mark Zuckerberg's stubborn streak, social-media pioneer Facebook might be just another part of a giant media or tech outfit today. Instead it's a giant on its own, with close to 500 million users, some $20 billion in market value, and millions of investors eagerly awaiting an IPO. For his new book, The Facebook Effect: the Inside Story of the Company That Is Connecting the World, Fortune contributor David Kirkpatrick gained unprecedented access to the company and Zuckerberg, who turns 26 this month. In this adapted excerpt, Kirkpatrick reveals Zuckerberg's turmoil as he resisted takeover offers from a parade of moguls.
The Viacom executive figured he'd impress the kid with a ride on the company jet, but clearly it was the youth who was in the driver's seat. Of all the suitors courting Mark Zuckerberg in the fall of 2005, one of the most enterprising was Michael Wolf, president of Viacom's MTV Networks. He had heard college students in MTV's focus groups talking incessantly about the new site, and he was determined to snag it for his parent company. But first he had to "friend" Zuckerberg. Wolf had figured out that the best way to reach the Facebook leader was to instant-message him, so he IM'd Zuckerberg periodically to say he planned to be in Palo Alto -- whether it was true or not -- and suggest a dinner. If Zuckerberg agreed, Wolf would fly out. But as the end of the year approached, Wolf got in touch with a better offer. He was planning to be in San Francisco with the Viacom corporate jet, he claimed. Would Mark like a ride back to New York for the holidays?
Zuckerberg took Wolf's bait. Since Viacom's corporate planes were in fact unavailable, Wolf chartered a top-of-the-line Gulfstream V for the trip from the San Francisco airport to Westchester County Airport, near Zuckerberg's parents' home in Dobbs Ferry, N.Y. Wolf flew out that morning from New York on American Airlines (AMR, Fortune 500). The MTV executive was waiting aboard the G5 as if it were the most normal thing in the world when Zuckerberg arrived, late, about 5:30 p.m. Then, as Wolf had shrewdly planned, they spent five uninterrupted hours together aboard the plane. He was resolved to find a way for Viacom to buy Facebook.
For much of the trip, however, the 21-year-old was in control of the conversation. He interrogated Wolf about MTV's business. How did companies like Viacom make their money? How much did MTV charge for advertising? How do you build your audience?
During the trip Zuckerberg took to admiring the G5. "This plane is amazing," he said.
"Maybe you should just sell a piece of the company to us," Wolf replied. "Then you can have one for yourself."
Wolf invited his guest to sit in the jump seat in the cockpit as the powerful jet landed at Westchester. When it pulled up to the private aviation terminal, two cars were waiting. One was Wolf's corporate sedan to drive him into the city. The other was the Zuckerberg family minivan, from which Mark's parents emerged. They beamed and gave their son a big hug. It was as if he were merely coming home from a semester at college.
The MTV president kept up his pursuit after the holidays, flying to Palo Alto in January with an elaborate PowerPoint presentation and again the next month with a more personal appeal. He and Zuckerberg were becoming chums. They took a long walk around the palmy, well-groomed streets and stopped by Zuckerberg's one-bedroom apartment. The place was messy, with a mattress on the floor, piles of books, a bamboo mat, and a lamp. Then they headed for dinner at a nearby restaurant. Wolf popped the same question he'd asked on the plane. "Why don't you just sell to us?" he asked. "You'd be very wealthy."
"You just saw my apartment," Zuckerberg replied. "I don't really need any money. And anyway, I don't think I'm ever going to have an idea this good again." Viacom (VIA) would try money nonetheless, with a cash offer of $800 million and provisions that could make it worth as much as $1.5 billion. But like many other suitors, the Viacom executives discovered they were dealing with a formidable character. If his invention's early appeal was at a freshman level, exploiting the desire of college students to check each other out, his professed ambition was much higher: to change the world.
Fortune is on Facebook
Zuckerberg's financing needs were far from his mind when he launched the site on Feb. 4, 2004, from his dorm suite at Harvard. Zuckerberg, a code writer since middle school, had arrived at Harvard equipped with his own computer and a giant whiteboard, the geek's consummate brainstorming tool. He built the site using free, open-source software like the MySQL database and fueled his late-night coding sessions with plenty of Beck's and Red Bull. A month before the site launched, Zuckerberg paid $35 to register the web address thefacebook.com (the name was later shortened) and started paying $85 a month to a web-hosting company. But the infectious appeal of the service went beyond what anyone expected. At the end of the semester, when the user base had reached 100,000 students at 30 schools, a well-connected classmate took Zuckerberg around Manhattan to meet with potential investors. At one of those meetings a financier offered Zuckerberg $10 million on the spot for the company. Mark had just turned 20. His company was four months old. He didn't for a minute think seriously about accepting.
Instead, Zuckerberg decided to relocate his company for the summer to the promised land of technology, Palo Alto. Searching Craigslist, he found a four-bedroom house to sublet as an office and bunkhouse, and persuaded roommate Dustin Moskovitz to give up a summer computer-lab job at Harvard to become essentially his chief operating officer. Keeping Facebook running, which meant constantly adding more servers, was starting to cost real money. Zuckerberg spent about $20,000 in the first few weeks in Palo Alto, using money he had saved from programming jobs. But clearly much more cash would soon be necessary.
A block away in Palo Alto, Internet wunderkind Sean Parker was stressed out. It was a hot afternoon, and the skinny blond 24-year-old hated doing physical work. But his lease was up and he was short on cash. So there he was in June 2004 on the sidewalk in front of his girlfriend's family's house, unloading boxes from the white BMW he had bought when times were flush. When he noticed a group of boys heading toward him, he stiffened. His boxes contained expensive computer gear. He didn't like the look of these kids -- all wearing sweatshirts with hoods up despite the heat. He thought they had a menacing air, but the shortest one walked right up.
"Sean," the guy said. "It's Mark, Mark Zuckerberg." Suddenly it all snapped into place. This was the guy he had met at dinner in New York City two months earlier, the kid who had treated him like a legend for his role in helping Shawn Fanning launch Napster. Later Parker co-founded another Internet company, Plaxo, a contact-info-management venture that had raised millions of dollars from investors. Lately Parker had run into trouble with his backers, who found him brilliant but unreliable. Yet to these 20-year-olds, Parker was an industry sophisticate.
Over dinner in Palo Alto, Zuckerberg witnessed firsthand the denouement of Parker's battle with his Plaxo backers. While Zuckerberg was introducing Parker more fully to his Harvard chums, Parker got a call from his lawyer. The news was bad. The Plaxo board was not only kicking him out of the company but also refusing to allow about half of his remaining shares in the company to vest. Parker was enraged. He was getting screwed. The Facebook boys listened in awe and dismay. "VCs sound scary," Zuckerberg recalls thinking. It was a formative moment. Feeling for his friend, and thinking he might learn much from Parker, Zuckerberg invited him to move into the house with them. By September, Zuckerberg was calling him the company's president. Besides his sage advice, Parker came in handy for one other corporate role: The boys relied on him to buy the alcohol for house parties, since he was the only one in the group over 21.
As the fall semester of 2004 loomed, the company was on the verge of a crisis. Over the summer membership had almost doubled, to 200,000. That was good and bad. "We were just lucky it wasn't completely bringing down the architecture," says Moskovitz. Zuckerberg and Moskovitz had decided not to return to Harvard that fall so that they could focus on the company. But now they needed money. At this point a Silicon Valley startup would typically solicit venture capitalists to make a cash infusion in return for a very big chunk of the company, as much as a third. Zuckerberg didn't want to give up that much control.
Parker called his friend Reid Hoffman, the founder of LinkedIn and a key member of an important Silicon Valley subculture -- the wealthy former leaders of PayPal. Hoffman arranged for Parker and Zuckerberg to meet with PayPal's onetime CEO Peter Thiel, now a private investor. When the Facebook boys made their presentation (Zuckerberg in his usual Adidas flip-flops), Thiel was impressed, especially with what was happening at colleges where Facebook was newly introduced. Within days it typically captured almost the entire student body.
Thiel then made what may be one of the great investments of all time. He agreed to lend $500,000, which would convert into a 10.2% stake in the company, giving the company a valuation of $4.9 million. That was lower than other offers, but Zuckerberg was pleased to have found an investor who seemed to trust him. The extent of Thiel's early advice to Zuckerberg: "Just don't fuck it up." Thiel sold a large amount of his stock in 2009; his remaining shares are worth several hundred million dollars.
During the fall, the originally static Facebook had already started evolving into the revolutionary medium it is today by adding new features like "the wall," which allowed anyone to write on a friend's profile. Membership reached 500,000 by October, and it was soon clear that even Thiel's money wasn't enough to pay for the company's growing infrastructure. But Zuckerberg remained deeply wary of Silicon Valley moneymen. Their thinking was short-term, he felt. His was epic.
Through a classmate whose father worked at the Washington Post Co. (WPO, Fortune 500), Zuckerberg had struck up a friendship with CEO Donald Graham, a member of the family that has controlled the Washington Post since the 1930s. Graham, who was immersed in building the company's own web businesses, recalls being immediately taken. "I thought it was a simply stunning business idea," he says, and made Zuckerberg an investment offer more spontaneously than any he has made before or since. Zuckerberg was impressed with how different Graham was from a bloodthirsty VC. "I was just blown away by the difference in culture -- that it's just such a long-term focus there. I was just like, 'Wow, I want to be more like this guy.' And that's when I seriously started thinking about doing another [investment] round."
As soon as word got out that Facebook was contemplating an investment, the Silicon Valley greed machine kicked into high gear. By February, 12 venture capital firms, four major tech companies, and the Post company were pursuing an investing deal. Viacom suddenly expressed interest in buying the company outright for $75 million, which would have put about $35 million in Zuckerberg's pocket for a year's work. But he had no interest in selling. The Post offer came in at $6 million for 10% ownership, valuing the company at $60 million. Ron Conway, a veteran investor who was advising Parker, told him, "My God! Take it! Close that sucker!" After a bit more haggling, a deal seemed to be done. Until another party entered the picture.
The Accel Partners VC firm was looking for a bigger score. After making its mark in the 1990s with a series of software and telecom investments, the Palo Alto firm had missed out on social-media opportunities. Kevin Efrusy, a junior member of the Accel team, had heard about Facebook from a Stanford University grad student interning at Accel and started making overtures. Parker declined to return his phone calls at first, thinking the VC firm had lost its mojo. Finally, on April Fool's Day, 2005, Efrusy decided to just walk over to Facebook's office. The two executives he encountered, Moskovitz and Matt Cohler (a recruit from LinkedIn), were struggling to assemble office furniture from Ikea. Moskovitz's head was bleeding from hitting a piece of furniture, and Cohler's pants were torn after getting caught on a nail. But their presentation of the business was brilliant, Efrusy recalls. Four days later Efrusy again walked down University Avenue to Facebook's office, barged into a meeting, and slapped a term sheet on the table. It topped the Washington Post terms by far, a $10 million investment valuing Facebook at $80 million. (The deal eventually reached $12.7 million and a valuation of just under $98 million.) After Efrusy left, the young entrepreneurs looked at one another in jubilation. Eighty million? Amazing! "But what about the Post?" Zuckerberg asked. Nobody had a good answer.
That night Accel's co-managing partner, Jim Breyer, a Silicon Valley heavyweight who's also a director of Wal-Mart (WMT, Fortune 500), hosted a dinner for Facebook's leaders at the elegant Village Pub near Palo Alto. The Pub is known for its wine list, and Breyer, a connoisseur, ordered a $400 bottle of Quilceda Creek Cabernet. Zuckerberg, still only 20, ordered a Sprite. Breyer was doing everything he could to loosen Zuckerberg up. But Zuckerberg remained uncomfortable about something. Then he started to tune out, Matt Cohler noticed.
Zuckerberg went to the bathroom and didn't return for a surprisingly long time. Cohler got up to see if everything was okay. There, on the floor of the men's room with his head down, was Zuckerberg. And he was crying. "Through his tears he was saying, 'This is wrong. I can't do this. I gave my word!' " recalls Cohler. "He was just crying his eyes out, bawling. So I said, 'Why don't you just call Don up and ask him what he thinks?' " Zuckerberg took a while to compose himself and returned to the table.
The next morning he did call Graham. "Don, I haven't talked to you since we agreed on terms, and since then I've had a much higher offer from a venture capital firm out here. And I feel I have a moral dilemma," Zuckerberg began.
Graham was disappointed, but he was also impressed. "I just thought to myself, 'Wow, for 20 years old, that is impressive -- he's not calling to tell me he's taking the other guy's money. He's calling me to talk it out.' " Graham knew that even his first offer was very high for a company so tiny and so young. "Mark, does the money matter to you?" Graham asked. Zuckerberg said it did. It could, he went on, be the one thing that could prevent Facebook from going into the red or having to borrow money. "Mark, I'll release you from your moral dilemma," said Graham. "Go ahead and take their money and develop the company, and all the best." For Zuckerberg it was a huge relief. And it further increased his respect and admiration for Graham. (Zuckerberg eventually asked the publisher to take a seat on the Facebook board.)
Facebook entered a new kind of boom phase, hiring staff, adding new features like photo sharing, and attracting millions more users. But Facebook was not yet a real business, especially given Zuckerberg's disdain for intrusive advertising, so it was burning quickly through its capital at the rate of about $6 million a year. That failed to discourage the delegates from corporate America, who continued to enhance their temptations. Zuckerberg kept huddling with the moguls, which gave rise to grumbling at Facebook, especially among the growing number of executives whom Silicon Valley recruiter Robin Reed was bringing onboard. What did all these meetings mean, they wondered? Zuckerberg wasn't bothering to explain his thinking. He thought of these meetings as a learning process. Reed had become a close observer of all the unhappiness, partly because she had one of the only private offices at the company. Zuckerberg wouldn't listen, Facebook staffers said. Zuckerberg should be replaced. Zuckerberg didn't know what he wanted to do with the company.
Finally Reed reached the end of her rope. "The team was almost ready to mutiny," says Reed. She arranged to meet with Zuckerberg on his way back from an East Coast meeting. But his plane was delayed, so when they finally met it was at 2:30 a.m. in the neon glow of a diner. Reed unleashed her frustration. "Mark, nobody knows what's going on. If you want to sell your company, then stop dicking around and say you want a billion dollars. If it's 2 billion, say that. If you don't want to sell, then say that!"
"I don't want to sell the company," Zuckerberg answered.
"Then stop taking all these meetings! You're sending the wrong message." Then she unleashed her final barrage. "You'd better take CEO lessons or this isn't going to work out for you!"
"So now you're finally being straight with me," Zuckerberg replied, turning more animated. "This is the first time I feel like you're telling me what you really think." Over the next few weeks Reed noticed a distinct change in Zuckerberg. For one thing, he did agree to start seeing an executive coach to get lessons on how to be an effective leader. The week after the confrontation he called the entire staff together for Facebook's first all-hands meeting.
While the talks with Viacom eventually fell apart over the structure of the deals, other offers kept coming and reached numbers that Zuckerberg had trouble dismissing out of hand. In July 2006, Yahoo CEO Terry Semel offered to buy Facebook for $1 billion cash. Zuckerberg seemed more than relieved a few weeks later when Yahoo (YHOO, Fortune 500), its stock suffering, reduced its offer to $850 million. As soon as he heard, a grinning Zuckerberg strode over to Moskovitz's desk a few feet away and gave a big high-five. The deal was off.
As all this was underway, executives at other media and tech firms were starting to ask if they ought to buy Facebook. Microsoft CEO Steve Ballmer had flown to Palo Alto to visit his young counterpart twice. As Zuckerberg is wont to do, he took Ballmer on a long walk. Zuckerberg told Ballmer that Facebook was raising money at a $15 billion valuation. But Ballmer had come with something more sweeping in mind. "Why don't we just buy you for $15 billion?" he replied, according to a very knowledgeable source. Zuckerberg was unmoved even by this offer. "I don't want to sell the company unless I can keep control," said Zuckerberg, as he always did in such situations. Ballmer took this reply as a sort of challenge. He went back to Microsoft's headquarters and concocted a plan intended to acquire Facebook in stages over a period of years to enable Zuckerberg to keep calling the shots. But Zuckerberg rejected all the overtures. What Ballmer finally agreed to instead was an advertising deal that included a provision for Microsoft (MSFT, Fortune 500) to pay a huge amount, $240 million, for a sliver of Facebook, 1.6%. Microsoft's investment gave Facebook an implied value of $15 billion.
Since then the company has reached another level of dominance, where the most passionate buyers are likely to be the public when the company eventually launches an IPO. Facebook expects to become profitable this year and bring in close to $2 billion in revenues. Zuckerberg owns about 24% of the stock, which puts his stake at almost $5 billion. But he seems in no rush for an IPO or the next big thing. After all, what would he do all day? "Unless I feel like I'm working on the most important problem I can help with, then I'm not going to feel good about how I'm spending my time," he says. "And that's what this company is." The ultimate payday is not a priority. Changing the world is.
The Facebook Effect excerpt: Full version - May. 6, 2010
The University of Maryland is one of several schools teaching apps technology. Stanford, in the heart of Silicon Valley and just up the freeway from Apple (AAPL, Fortune 500), has had oversubscribed courses since last year; its lectures are videotaped and available free on both iTunes and YouTube. The University of Washington's continuing-education evening class includes Boeing (BA, Fortune 500) engineers in their sixties, a pharmacist, and former savings-and-loan employees. The Royal Melbourne Institute of Technology has a course too. Once upon a time, if you were a computer major, you learned to program mainframes and then PCs; you aspired to be the next Bill Gates, developing code that might revolutionize an industry. Now a single-purpose app, like a silly program that fogs up the screen like a bathroom mirror, can net the author a fortune. Such gold rush possibilities make iPhone development a very enticing academic offering.
Porter says the challenge of smartphones is to treat them as more than small computers and to harness their mobile capacity. "The device always knows where it is," he says. So, for example, his students are working on an app called I Remember UMD that would create an ongoing time capsule. If you had met your future spouse at the library, you could note that spot, and others could learn of it when they walked by with their iPhones.
The class concentrates as much on aesthetics as utility. For one lab exercise, students competed to make the best onscreen soap bubbles -- which ones floated most realistically, which ones seemed to reflect light accurately. None of these courses are for novices. Syllabuses refer to such geekspeak as Xcode, Modal Views, and Interface Builder, with nary a mention of shoot-'em-up games; about the most exciting it gets is a wrap-up lecture at Stanford on "The Dark but Powerful Heart of Objective-C." That's a programming language, but you knew that.
Colleges hope the courses lead to useful campus apps. Apple declines to discuss any of its arrangements with various schools, but sources say the company provides its engineers free and is an easy partner. It's no wonder why. The company gets an early look at potential engineering talent. And if any apps ultimately make it to market, Apple, as always, gets its 30% cut of sales. Now that's investing in education.
iPhone apps: The hottest course on campus - May. 19, 2010
- Google coming to your TV sets
- Service to mesh TV with surfing the web
- "We believe (this) will change the future of television"
"Google TV", developed in partnership with technology titans Sony, Intel and Logitech, fuses the freedom of the internet with television programming.
Google executives vowed their TV platform will succeed where offerings such as Apple TV have foundered.
"Google TV is a new platform that we believe will change the future of television,'' Google group product manager Rishi Chandra said, after unveiling the new service at a software developers conference in San Francisco, California.
"Users don't have to choose between TV and web; they can have both.''
Google TV, which is powered by Google's Android software and Chrome web browser, can be accessed using upcoming web-enabled televisions from Sony or set-top boxes from Logitech that route web content to existing TV sets.Sony and Logitech said the sets and boxes will be available in the United States in time for the year-end holiday shopping season and be rolled out internationally next year.
Pricing for the TV sets or the set-top boxes was not disclosed.
During today's demonstration of the Internet TV technology, Google conducted a series of internet searches in a drop-down box that appears at the top of television programs.
The search results pointed to internet videos and other content related to the television program on the screen.
A telecast of a sporting event can be shrunk into a small ``picture-in-picture'' box so a viewer can look at statistics or other material about the game on TV.
Viewers will also be able to make search requests by speaking into a remote that runs on Google's Android operating system.
And of course, users can simply use the entire screen for web surfing.
Three of Google's biggest rivals - Apple Inc, Microsoft Corp and Yahoo Inc - also have been trying to bring more internet video and services to televisions.
Apple chief executive Steve Jobs once described his company's device for tethering TVs to the internet as a "hobby''.
Forrester Research analyst James McQuivey expects Apple to become much more serious about its efforts now that Google is expanding into TV.
"The whole game for Google is to become the (operating system) for the living room and make sure Apple doesn't,'' McQuivey said.
Internet giant Google's coming to your TV set | News.com.au
Chatter about a "convergence" between TV and PC has been going on since the mid-1990s. Many companies have tried -- and failed. But this week, that convergence may finally happen successfully.
Google is reportedly working with Sony, Logitech, and Intel to develop a new "Smart TV" platform based on Android internally code-named "Dragonpoint." It's likely that they're working with other companies as well.
Google's announcement will most likely take place tomorrow morning at its Google IO Conference in San Francisco, Calif.
According to the rumored plan, Sony will make Internet-connected TV sets powered by Intel Atom chips. Google will provide the operating system and system software. Logitech is working on a line of keyboards that would replace remote-control units.
Unlike previous efforts, which involved either connecting a PC to a TV, or watching TV on a PC, the Dragonpoint system would involve an appliance that is both a PC and a TV. It would look exactly like a big-screen TV, but the insides would also feature an Internet-connected computer.
This new type of TV may be called "Smart TV." Dragonpoint-based "Smart TV" form factors could include all-inclusive TVs, Blu-Ray players and set-top boxes.
Intel CEO Paul Otellini told the Financial Times that "The revolution we’re about to go through is the biggest single change in television since it went color." He just might be right.
The benefit for consumers is that they will be able to search for TV shows using Google searches, searching not only for titles, actors and other things, but also for dialog (by searching close-captioning streams).
But that's just the beginning.
Your TV Gets Apps
Google announced today a new App store for its browser called the Chrome Web Store, which becomes available to users "later this year," according to Google. The company envisions something similar for your TV.
Google will cultivate developer activity around Dragonpoint, so we can look forward to a TV "app store" filled with downloadable programs.
Sundar Pichai, vice president, Product Management, said at the IO Conference that he wants web apps to do "everything desktop apps can do." That's a goal of the Android-based Dragonpoint platform as well.
One example is an app called Clicker.TV. Google allowed a company called Clicker to show off its Clicker.TV app, which is an HTML5 application that runs in a web browser, but also designed for a TV set. The app offers TV shows that have been posted on various sites on the Internet, which you can choose and watch anytime you like from a single "catalog."
The Clicker web site boasts of "more than 650,000 episodes, from over 10,000 shows, from over 2,000 networks, 30,000 movies, and 80,000 music videos from 20,000 artists. "
(The company reportedly plans an iPad version in the future.)
Other apps could enable TV watchers to monitor Internet data, such as sports scores, financial information or even their own social networks, while watching TV.
One part of the business model is to be able to bring advertising individualized to each household to TV.
Your TV Gets Social
Trip Chowdhry, managing director at Global Equities Research, has called Dragonpoint a "social Internet computing platform."
He believes "Smart TV" will bring personalization and social networking to the living room. For example, two people on opposite sides of the country could watch the same Internet-based show (one that isn't live) at the same time, and chat with each other about the program.
It's easy to see how TV could be integrated with social networking. In fact, it's already happening on Twitter. TV shows and events always trend very high on Twitter searches. Users discuss TV shows as they're broadcast, and very often reference shows with links that enable followers to watch the show online.
If you move all this activity to the TV set, and provide users with a keyboard, it's not hard to imagine the social stream and TV show displayed at the same time, or social networking links that play the show on the TV set.
Your TV Goes Mobile
One of the overarching goals of Google's Android initiative, including its Dragonpoint variant, is to enable developers to build once and deploy everywhere. That means the "Smart TV" idea can be deployed on an Android tablet, with cross-platform interaction.
For example, you should be able to watch TV on a tablet, and pause a show. Later, at home, you could be able to continue watching from the same point.
You'll likely be able to use an Android tablet as a remote control, and record programs to a virtual DVR from the tablet that you intend to enjoy later on the HD TV in your living room.
Why Google's 'Smart TV' Will Succeed — Datamation.com
Developers at a conference applauded "Google TV," and a slew of tech industry titans, including microchip maker Intel Corp and TV maker Sony Corp, sent their chief executives to announce that they had joined the project and that TV sets would be ready in time for Christmas buying.
The key to Google TV is an on-screen search box, just like on Google's Web site. The TV search box accesses Google's search engine to look through live programs, DVR recordings and the Web, delivering a relatively compact list of results that can be accessed with a push of the button.
Internet television has been a minefield for the world's most creative and deep-pocketed companies, and in a sign of the challenge, embarrassed Google engineers struggled initially to get their TV running, asking the audience to turn off their cellphones, which were interfering with TV remote controls.
Web surfers have never left their desktops for the living room, and television watchers have kept their remotes pointed toward familiar territory despite attempts by Microsoft Corp and by Apple, which was the focus of frequent verbal jabs and jokes.
Sony will build devices, marketed as Sony Internet TVs, to launch in the United States in the fall -- in time for the 2010 holiday season -- with Intel providing its small Atom processors to run machines. Sony did not release pricing and said it had not decided on plans for the TVs in other markets.
Logitech International also will create a Google TV appliance that can work with current high-definition TVs.
Television represents an attractive market in which to expand Google's Internet advertising business, which generated the bulk of its $23.7 billion in 2009 revenue.
Walkman creator Sony has seen its dominance in electronics eroded and has been looking for new technology, including 3D, to goose TV sales.
"Video should be consumed on the biggest, best and brightest screen in the house. And that's a TV. It's not a PC or a phone or anything else in between," said Google project senior product manager Rishi Chandra.
Best Buy Co Inc will sell devices and DISH Network Corp will integrate its satellite television service into Google TV. Chief executives from those companies -- as well as Google, Sony, Intel, Logitech and Adobe Systems Inc -- all appeared on stage at Google's developers' conference for the announcement.
The move fits with Sony's strategy to focus more on its content business and to forge alliances rather than try to develop and produce everything on its own, said Mizuho Securities analyst Ryosuke Katsura.
"Sony is trying to be asset-light and increase earnings from content distributed online," he said. "For device development, it is seeking alliances rather than going it alone like it has been doing up until now, and this deal is a part of that move."
Shares in Sony, the world's No. 2 LCD TV maker behind Samsung Electronics Co, rose 0.4 percent in afternoon trade in Tokyo, outperforming a 2.7 percent fall in the benchmark Nikkei average.
Google executives said previous efforts had failed because they dumbed down the Web for television, were closed to participation by others, and made people choose between using the Web or television.
"It's much harder to marry a 50-year-old technology and a brand new technology than those of us in the brand new technology industry thought," Google Chief Executive Eric Schmidt acknowledged to the audience of developers.
TV presents a potential new audience for the trove of online videos that Google offers through its website YouTube, which demonstrated on Thursday a new service called Lean Back designed to create automated video playlists for Google TV users.
A YouTube spokesman said the content currently available on YouTube would also be available to consumers surfing the web with the browser on Google TV, but that it was still determining what exactly would be on the Lean Back service.
It was not immediately clear whether media companies might object to having the online video content that they have offered for PCs available on Google TV, fearing such a move could harm their traditional TV business.
A spokesman for video website Hulu, owned by Walt Disney Co's ABC, News Corp's Fox and General Electric Co's NBC, declined comment on Google TV.
Hulu and its owners have already blocked its content from other Web TV devices like a set-top box from privately held Boxee and Sony's PlayStation 3 game console.
Chief among the questions hanging over the newfangled televisions is the price.
"If this thing costs 900 bucks forget it. This is going to have to be right about where a phone is, 250 bucks," said Gartner analyst Ken Dulaney in reference to the set top box that Logitech said will bring Google TV to existing high-definition television sets.
Hudson Square Research analyst Daniel Ernst said consumers could be disappointed if TVs appeared before developers had made many applications for the system.
"The basic concept that they are doing is great, but it (parts of it) looked a little half baked to me. Someone like Apple is going to do this, and they are going to do it well," he said.
Apple in 2007 debuted Apple TV, which plays computer-based video on television sets. Its popularity has paled in comparison with devices like the iPhone and iPad.
Google's increasingly tense relationship with Apple was clear throughout the conference. Engineers showed off new versions of the Android mobile phone platform, which competes with Apple's iPhone.
Android also will run Google TV, turning Android phones into controls that can be used in the same room as the television or remotely across the Web.
Apple has criticized Adobe's Flash video product, a popular product which has been left out of Apple's iPad tablet but was embraced by Google.
"It turns out that on the Internet -- people use Flash!," one Google executive said in a typical joke at Apple's expense.
Google Unveils Web TV — Datamation.com
American Solar Energy Society Executive Director Brad Collins talks to RenewableEnergyWorld.com's Stephen Lacey about the growth in the solar industry and how it's helping ASES further its goals.
SOLAR TODAY: Video: ASES' Brad Collins on Solar's Progress
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German prosecutors have launched a criminal investigation over whether Google broke data protection regulations when it collected fragments of Wi-Fi data while shooting imagery for its mapping application.
The probe, conducted by the Hamburg Prosecutor's Office, follows Google's admission that it mistakenly collected the content of communications from non-password protected Wi-Fi networks using its Street View vehicles, which photograph streets for the Google Maps service.
The Hamburg prosecutor's office is at an early stage in the case, spokesman Wilhelm Möllers said Thursday.
Möllers said his office will investigate how Google was collecting the data, but that it may be at least two weeks before a decision is made whether to file charges.
Google said it collected Wi-Fi network data, such as SSID (Service Set Identifier) information and MAC (Media Access Control) addresses. The company said it only collected fragments of personal Web traffic as its Wi-Fi equipment automatically changed channels five times a second. Wi-Fi networks can carry several megabytes of data per second.
The criminal probe marks an additional problem for Google in Germany, which has been under ongoing scrutiny from Hamburg's Data Protection Agency.
The Data Protection Agency has the power to assess penalties against Google, and has asked the company to turn over by next Wednesday a hard drive from one the vehicles collecting the data, according to an official from the agency.
"We have several problems with Street View and more problems with WLAN" scanning, she said.
Although Google has collected Street View data for Germany, the service has not been launched there. Google has not yet fully responded to a set of 13 points compiled by the Data Protection Agency that it says are necessary to comply with German laws, she said.
One of those points is agreeing to delete images of peoples' homes from Street View before those images go live, she said. In other locales, Google will remove an image on request, but only after publication.
Germany's privacy laws generally restrict photographs of people and property without a person's consent, except in very public situations, such as a sporting event.
The Data Protection Agency also requested that Google more thoroughly blur peoples' faces and that those partially censored images be permanently deleted from its databases.
Italy's data protection authority and the French National Commission on Computing and Liberty (CNIL) are also reviewing Google's Wi-Fi scanning. The U.K.'s Information Commissioner's Office said Google appeared to have breached data protection requirements, but that it would not pursue the company after Google agreed to delete the data.
Germany Launches Criminal Investigation of Google - PCWorld
It has been three years, an eternity for gadgets, since Apple Inc. unveiled the iPhone, and by now, other phones do some things better. Yet Apple is selling more iPhones than ever.
What is it about the iPhone? Its success shows how Apple has triumphed at two crucial qualities: status and simplicity. And it's a reminder that although intense Apple fans will obsess over the upgrades the iPhone is expected to get this summer, such details won't matter as much to everyday buyers.
Other phones have higher-resolution cameras and can shoot high-definition video. The processor seems faster in new phones such as the Droid Incredible. A more energy-efficient, touch-screen technology is eclipsing the one used in the iPhone screen. And competitors are matching features that once set the iPhone apart, including its slim shape and its store with thousands of applications and games.
"This thing is not state of the art," said Michael Morgan, an ABI Research analyst.
But whether the iPhone has the best technology doesn't seem to be the question most people ask. Instead, many people crave the aura of cool that iPhones seem to convey.
"When you see people with them, I'm like, 'Oh, OK, they get it,' " said Jason Sfetko, a designer at Complex magazine in New York. When he sees someone with a BlackBerry, "I might think, maybe they're an accountant or something. They're answering too many e-mails."
About 2 1/2 years ago, the iPhone's Web browser was a selling point for Sara Maternini, 35, who works in public relations in Milan, Italy. She needs to always be online and says the iPhone was the only device that made Web surfing feel as it does on a computer.
Apple has sold more than 51 million iPhones since they hit the market in 2007, including 8.75 million in the most recent quarter. That was more than double the number it sold in the comparable quarter last year.
The surge also has helped Apple's stock double over the past year, and investors are betting that the iPhone still has room to grow. The iPhone ranks third in the global smartphone market, with a 14 percent share. Nokia Corp. has 47 percent and Research in Motion Ltd., maker of the BlackBerry, has 20 percent. However, phones that use Google Inc.'s Android software are increasing sales faster. Android accounts for 4 percent of the market, up from less than 1 percent last year, according to Gartner Inc., a market-research company.
Carolina Milanesi, who lives in Britain and analyzes the mobile market for Gartner, has tried to switch away from the iPhone but gets hung up on something every time. She spent 20 minutes trying to set up e-mail on an Android phone, only to fail. The iPhone is so simple her 2 1/2-year-old daughter can operate her spelling and animal-noises apps herself.
The iPhone isn't as flexible as others, and Milanesi bristled at things Apple wouldn't let her do. "But then you kind of get used to it, and you don't miss it," she said.
It's an iPhone world
May 22, 2010
Unusual sticker can separate you from other iPad owners. This post features the most creative Apple iPad vinyl decals and stickers.
Iron Man iPad Sticker
This awesome Apple iPad sticker is perfect for the fans of Iron Man. [link]
Boba Fett iPad Sticker
Star Wars fans will love this cool decal of the famous bounty hunter. [link]
Lady Gaga iPad Sticker
Lady Gaga inspired vinyl decal will look great on your Apple iPad. [link]
Star Trek iPad Sticker
Go where no man has gone before with your Star Trek themed iPad. [link]
Headphones iPad Sticker
This black headphones vinyl sticker is perfect for your Apple iPad. [link]
I Smell a Rat iPad Sticker
Can you smell it? This rat will make your iPad stand out in a crowd. [link]
Snoopy iPad Sticker
Cute Apple iPad vinyl decal created by Amanda Davis. [link]
Monkey iPad Sticker
Now you can have your very own tiny ape on your Apple iPad. [link]
Apple Pi iPad Sticker
Clever Apple iPad decal made from black high grade quality vinyl. [link]
Darth Vader iPad Sticker
Lord Vader will be forever by your side on your Apple iPad. [link]
Joker iPad Sticker
This is a digitally printed and cut vinyl decal, which fits nicely on an iPad to make it look like the Joker is holding the apple. [link]
True Blood iPad Sticker
Stylish sticker inspired by famous television series about vampires. [link]
12 Cool Stickers for your iPad
Paul Sakuma / AP Microsoft's Kin Two, left, and Kin One, are geared toward social networking-obsessed teens and twenty-somethings that want a cool, affordable handset without feeling the need for additional apps like Apple's iPhone offers.
SAN FRANCISCO - The search for a cell phone starts with one big question. Should you get a smart phone that lets you customize your device with all kinds of applications, or should you save money and get a not-so-smart phone that has fewer functions?
Microsoft thinks it has two new phones that could bridge the gap. Its Kins, which cost $50 or $100 through Verizon Wireless, are geared toward social networking-obsessed teens and twenty-somethings who want an affordable way to keep in touch on the go without diving into additional apps like Apple's iPhone offers.
It's a potentially shrewd move because the world's largest software maker has been losing ground in the mobile market to newer players such as Apple and Google, which makes the Android operating software. (Msnbc.com is a joint venture of Microsoft and NBC Universal.)
$30 monthly data plan
The Kins' simple software, moderately good looks and low upfront cost could turn hip young heads. Unfortunately, the phones have aggravating shortcomings. They're saddled with a sluggish processor, lack instant messaging and mapping applications and require a full-price data plan ($30 per month).
The first thing you'll notice about the Kins is their shape. Kin One ($50 with a rebate and two-year Verizon Wireless contract) is short and squat with a keyboard that slides out from its bottom, while Kin Two ($100 with a rebate and two-year contract) is longer, with a keyboard that slides out from its side.
Kin One has a touch screen that measures 2.6 inches diagonally, a 5-megapixel camera and 4 gigabytes of built-in memory; Kin Two includes a touch screen that measures 3.4 inches diagonally, an 8-megapixel camera and 8 gigabytes of memory.
Software too limiting
The Kin's software, which Microsoft developed just for these phones, is a mixed bag. It's well designed and extremely simple, but it's too limiting.
It starts in a promising way, with a home screen populated by a rotating list of your friends' updates to blogs and social networks like Twitter and Facebook. There's also a nifty feature called the "Spot" that lets you send photos to friends by pulling them into a little circle at the bottom of the screen.
The Kin home screen is flanked by two hidden side screens you can swipe to see. One is meant to be plastered with a collage of your favorite contacts, and the other houses the Kin's limited list of applications and settings.
No way to IM friends
Once I started perusing the applications, I was vexed that there was no way to instant-message my friends, or look up directions on a built-in map application to meet up with them. Sure, you can send text messages or use the phone's Web browser to look up directions, but why not just include these functions on the phone if you're already forcing customers to pay for a full-size data plan?
This was all made worse by the phone's pokey performance. On numerous occasions the touch screen had a delayed response, such as when I scrolled through a list of albums in the music player, swiped between the main screens or tapped to open a link or contact. At times, the mechanical "back" button on the face of the phones took a little while to respond.
Surfing the Internet was possible but painful as the Kins languidly loaded websites. A Kin often refused to update my status on Facebook, claiming Verizon's network wasn't available.
Zuner player a plus
It's not all bad. The Zune music player is attractively laid out and super simple to navigate. It was easy to find and download music straight to the Kins once I signed up for a Zune Pass subscription ($15 per month).
I also liked the Kin Studio site, which users can access to see a big timeline of everything they've done with their phone, from photos and videos taken to texts sent.
Phone calls sounded OK, and it was nice to see the Kins come with Wi-Fi access.
Both Kins have no-fuss, decent cameras with bright LED flashes, numerous picture-taking settings and dedicated camera buttons. I found it easier to focus my shots with the smaller, lower-resolution Kin One, because the phone fit better in my hand than its bulkier brother. I also liked that the Kin screens respond to multiple finger gestures for zooming in and out of photos and, if you dare load them, Web pages.
Review: Microsoft Kin phones not smart enough - Wireless- msnbc.com
May 16, 2010
It's not just Hollywood that breaks out the blockbusters every summer. The big publishers have plenty of star authors lined up this year, including Arizona's own vampire queen, Stephenie Meyer.
"The Short Second Life of Bree Tanner" is just a spinoff novella, but at the end of April, a month before its May 31 release, it was the No. 1 advance order on barnesand noble.com. No. 2 was the e-book version of the same title.
That's a mark not only of Meyer's popularity but also of the growing acceptance of e-books. Earlier this month, Simon & Schuster announced that first-quarter sales from its digital division (which includes audiobook downloads) had more than tripled, to $12 million, and now account for nearly 8 percent of income for the publishing house.
But although it's clear that e-books are here to stay, it's not quite as clear what that means to the industry as a whole or, more important, to the future of the good old-fashioned hardcover or paperback book as a mass medium.
E-books have been gaining ground steadily since the Sony Reader hit the market in 2006 with its paperlike display, followed by Amazon.com's Kindle and the Barnes & Noble Nook.
The latest game-changer is Apple's iPad, which, despite some initial skepticism from the technophiles, reached the 1 million sales mark in a mere 28 days, less than half the time the iPhone took.
"I think the true breakthrough will come this summer" when Apple's new iBooks app is released for the iPhone and iPod Touch, says Michael A. Stackpole, a Valley-based sci-fi and fantasy author who has been following closely as the publishing industry has responded to changing technology.
"Electronic publishing is absolutely the wave of the future. You will watch in the next two to five years, and I'm betting more on two than five, a collapse of publishing very similar to what happened with what digital did to music."
Of course, the Internet has inspired many such apocalyptic predictions, most of which turned out to be overblown. But the iPad as e-book reader is not what has the Apple acolytes genuflecting, anyway. Sure, its successful release has spurred e-book sales - Apple reported 1.5 million iBooks downloaded as of April 30 - but compared head-to-head with the specialized readers, it does have some drawbacks, particularly the lack of that "virtual ink" look.
Instead, the iPad has generated excitement because its larger display, coupled with a touch-screen interface like the iPhone's, opens up the possibilities for multimedia on the go.
"People become more used to reading on a screen, so their very definition of 'book' is something you read on your iPhone or another device," Stackpole says. "You can have beautiful books with illustrations, but they can also be interactive with video files and sound files. Books can take on other dimensions that you didn't expect."
That's exactly the idea behind Vook, launched last fall as a website and iPhone app, which pairs text titles with video and Internet links.
"The iPad tripled our sales," says Brad Inman, CEO of the San Francisco-based startup.
Vook's fast-growing lineup is a mix of non-fiction (cookbooks, "Crush It!"), public-domain classics ("The Call of the Wild," "The Phantom of the Opera") and some current fiction (Anne Rice is a top seller).
The experience of reading one of those titles will be familiar to the Web generation, except that instead of searching YouTube for a clip from the 1925 "Phantom" film, all the extras have been curated for you.
And, Inman adds, although Vooks can be viewed with a Web browser, the iPad app looks a lot sleeker.
Which is the point of the excitement about iPad, as the first successful "slate computer." Its form and functionality will reshape the content of media, just as surely as Gutenberg's printing press gave rise to the novel and the long-play record led to pretentious '70s concept albums.
As the Washington Post's Michael Gerson put it in a recent paean to the iPad, "The Information Age is now affordable, portable, intuitively organized and infinitely customizable. All future content, including books and newspapers, will need to assume the shape of this innovation."
Not. So. Fast, say bibliophiles everywhere. The iPod may ultimately slay the CD player, but the book isn't going to disappear. This isn't Betamax or the 8-track we're talking about. The original mass medium has proven popular for more than half a millennium.
"E-books are going to become like audiobooks, part of all the platforms, but I don't buy into the idea that they're going to completely replace the printed technology," says Barbara Peters, co-founder of the Poisoned Pen Press, a boutique mystery publisher in Scottsdale.
"E-books have several advantages. Instant gratification; a lot of people really like that. They are cheaper. They have less mass."
Peters is no technophobic Luddite (she called from France via Skype). But as a regular traveler, she's noticed that e-book readers have a downside, for instance, at the airport.
"It has to go through security," she says. "You can't read it while you're sitting on the runway because it's a portable electronic device. . . .
"In a blackout, you can still read a book by candle, but you're going to have a hard time recharging your Kindle."
Now that e-books have proven their economic viability, the publishing industry is going through the same kind of shake-up that already has changed the balance of power in the music business. But that doesn't necessarily spell the doom of a literary format.
"I think their concern in the book world is much more, 'How is it going to be distributed and who is going to get the money?' " says Dave Barry, the best-selling humor writer who muses on the digital present, among other topics, in his latest book, "I'll Mature When I'm Dead."
"Digital this, digital that. There's a lot of talk about rights and distribution, but when people are talking about stuff like that it's because there are people buying books.
"Now, some of these books are not that great. But they're selling in huge quantities."
Robert Rosenwald, co-founder and publisher of the Poisoned Pen Press, thinks e-books are destined to be the "budget" end of the publishing price spectrum.
"I have priced our e-books at $6.95, which is the price of a mass-market paperback," he says.
"This differs from what most publishers feel and how they deal with e-books. Many view it as some sort of competition to their print books, so they tend to price e-books anywhere from 60 percent of the hardcover print price to 100 percent, which I think is off the charts. I don't understand why anyone would pay $25 for an e-book."
His partner, Peters, is convinced that e-books are a complementary technology rather than a replacement.
"Some publishers have been bundling e-books with hardcovers," she says, targeting the commuter market: Read the e-book on the go, then curl up by the fire at home. Old school, baby!
As for Barry, who ended his long-running Miami Herald column in 2005, he offers grim predictions for the newspaper business in his new book, but the book itself gets a rosier outlook.
"I write these young-adult fiction books for Disney with Ridley Pearson, and I have a 10-year-old daughter, so one of my feet is in that world," he says. "And kids read a lot. My daughter reads a lot. Partly it's because her parents are writers, but her friends read a lot, too. The 'Harry Potter' books, no books ever sold like that in the history of the world. . . .
"I have to think that books have a chance."
Reading world turns a new page
May 15, 2010
Battery-powered covers? Holographic windmills? Playboy isn't the only publication trying to inflate readership with marketing tricks
With its June issue, Playboy thinks it's concocted an idiot-proof way to boost its sagging sales: A 3-D version of Playmate of the Year, Hope Dworaczyk. (Yes, special glasses are required.) "Today's print environment," says Playboy editorial director Jimmy Jellinek, requires that you "create newsstand events." (Watch an AP report about Playboy's "3D centerfold" gimmick.) But the 57-year-old magazine, which has lost over half its circulation since 2006, is not the only publication that's tried to pop out at the newsstands as digital media has overshadowed print. Here's a look at four of the more desperate cover stunts in recent history:
Esquire's E-ink experiment
Harnessing the same technology used in the Amazon Kindle e-reader, Esquire created the first-ever e-ink magazine cover for its 75th anniversary issue. Powered by a special mini-battery (that died after 90 days), the flashy cover blinkily declared, "The 21st Century begins now." While Esquire editor David Granger said he hoped the issue would be put "in the Smithsonian," the cover faced a barrage of bad reviews. Particularly damning: Esquire's "little experiment," said Anya Kamenetz in Fast Company, had a carbon footprint 16 percent greater than a typical print publication.
Rolling Stone's historic 3-D cover
For its 1,000th issue and 40th Anniversary, Rolling Stone created a holographic, 3-D cover, allegedly the first in magazine history. Though the cover, a collage image of 100 cultural figures the editors judged "most influential" since its 1967 launch, reportedly cost nearly $1 million, the investment apparently paid off. The issue sold out at many newstands, reported Jack Shafer in Slate. "Nobody in magazine publishing will say no to anniversary issues until readers do," Shafer said at the time, and "I don't think that day has arrived."
Popular Science's boggling "augmented reality" cover
For its "Future of Energy" issue, Popular Science embedded an "augmented reality" module on its cover. The idea was that a reader would hold the cover upright in front of his computer's webcam, triggering the computer's monitor to display a "3-D" image of spinning windmill blades. "The investment was significant," said PopSci Media group publisher Gregg Hano. But "we felt the technology would be well-received by our readers. It is certainly something that we plan to utilize again." They haven't used it since.
Playboy's daring Marge Simpson expose
Playboy attracted a swarm of media attention when it showcased a "nude" Marge Simpson — the first cartoon character to land the coveted spot. Playboy CEO Scott Flanders (no relation to Ned) said the cover would help the publication reach a younger audience. "We thought it would be hip, cool and unusual," he told the Chicago Sun-Times. But "objectifying" the blue, beehived mother of three struck Gawker as "creepily fanboyish." Still, fortunes may be looking up for Playboy: After cutting its frequency, the magazine is back to publishing 12 issues a year, reports Folio.
Playboy's 3D centerfold and other dubious magazine gimmicks - The Week
By Peter Svensson Associated Press May 9, 2010
New York — In 1998, a hacker told Congress that he could bring down the Internet in 30 minutes by exploiting a certain flaw that sometimes caused online outages by misdirecting data. In 2003, the Bush administration concluded that fixing this flaw was in the nation’s “vital interest.”
Fast forward to 2010, and very little has happened to improve the situation. The flaw still causes outages every year. Although most of the outages are innocent and fixed quickly, the problem still could be exploited by a hacker to spy on data traffic or take down Web sites. Meanwhile, our reliance on the Internet has only increased. The next outage, accidental or malicious, could disrupt businesses, the government or anyone who needs the Internet to run normally.‘Hijackings’
The outages are caused by the somewhat haphazard way that traffic is passed between companies that carry Internet data. The outages are called “hijackings,” even though most of them are not caused by criminals bent on destruction. Instead the outages are a problem borne out of the open nature of the Internet, a quality that also has stimulated the Net’s dazzling growth.
“It’s ugly when you look under the cover,” says Earl Zmijewski, a general manager at Renesys Corp., which tracks the performance of Internet data routes. “It amazes me every day when I get into work and find it’s working.”
How information travels
When you send an e-mail, view a Web page or do anything else online, the information you read and transmit is handed from one carrier of Internet data to another, sometimes in a long chain. When you log into Facebook, your data might be handed from your Internet service provider to a company such as Level 3 Communications Inc., which operates a global network of fiber-optic lines that carry Internet data across long distances. It, in turn, might pass the data to a carrier that’s connected directly to Facebook’s server computers.
The crux of the problem is that each carrier along the way figures out how to route the data based only on what the surrounding carriers in the chain say, rather than by looking at the whole path. It’s as if a driver had to get from Philadelphia to Pittsburgh without a map, navigating solely by traffic signs he encountered along the way — but the signs weren’t put up by a central authority. If a sign pointed in the wrong direction, that driver would get lost.
That’s essentially what happens when an Internet route gets hijacked. Because carriers pass information between themselves about where data should go — and this system has no secure, automatic means of verifying that the routing information is correct — data can be routed to some carrier that isn’t expecting the information. The carrier doesn’t know what to do with it, and usually just drops it. It falls into a “black hole.”
On April 25, 1997, millions of people in North America lost access to all of the Internet for about an hour. The hijacking was caused by an employee misprogramming a router, a computer that directs data traffic, at a small Internet service provider.
A similar incident happened elsewhere the next year, and the one after that. Routing errors also blocked Internet access in different parts of the world, often for millions of people, in 2001, 2004, 2005, 2006, 2008 and 2009. Last month a Chinese Internet service provider halted access from around the world to a vast number of sites, including Dell.com and CNN.com, for about 20 minutes.
In 2008, Pakistan Telecom tried to comply with a government order to prevent access to YouTube from the country and intentionally “black-holed” requests for YouTube videos from Pakistani Internet users. But it also accidentally told the international carrier upstream from it that “I’m the best route to YouTube, so send all YouTube traffic to me.” The upstream carrier accepted the routing message, and passed it along to other carriers across the world, which started sending all requests for YouTube videos to Pakistan Telecom. Soon, even Internet users in the U.S. were deprived of videos of singing cats and skateboarding dogs for a few hours.
In 2004, the flaw was put to malicious use when someone got a computer in Malaysia to tell Internet service providers that it was part of Yahoo Inc. A flood of spam was sent out, appearing to come from Yahoo.
“Hijacking is very much like identity theft. Someone in the world claims to be you,” said Todd Underwood, who worked for Renesys during the Pakistan Telecom hijacking. He now works for Google Inc., trying to prevent hijacking of its Web sites, which include YouTube.
In 2003, the Bush administration’s Critical Infrastructure Protection Board assembled a “National Strategy to Secure Cyberspace” that concluded that it was vital to fix the routing system and make sure the “traffic signs” always point in the right direction.
But unlike Internet bugs that get discovered and fixed relatively quickly, the routing system has been unreformed for more than a decade. And while there’s some progress being made, there’s little industry-wide momentum behind efforts to introduce a permanent remedy. Data carriers regard the fallibility of the routing system as the price to be paid for the Internet’s open, flexible structure. The simplicity of the routing system makes it easy for service providers to connect, a quality that has probably helped the explosive growth of the Internet.
That growth has also increased the risks exponentially. Fifteen years ago, maybe 8,000 people in the world had access to computers that use the Border Gateway Protocol, or BGP, which defines how carriers pass routing information to each other. Now, Danny McPherson, chief security officer at Arbor Networks, believes that with the growth of Internet access across the world and the attendant increase in the number of carriers, that figure is probably closer to 1 million people.
Peiter Zatko, a member of the “hacker think tank” called the L0pht, told Congress in 1998 that he could use the BGP vulnerability to bring down the Internet in half an hour. In recent years, Zatko — who now works for the Pentagon’s Defense Advanced Research Projects Agency — has said the exploit would still work. However, it would likely take a few hours rather than 30 minutes, partly because a greater number of Internet carriers would need to be hit.
Plenty of solutions have been proposed in the Internet engineering community, going back as far as 1995. The U.S. government has supported these efforts, spurred in part by the Bush administration’s 2003 strategy statement. That has resulted in some trials of new technology, but adoption by data carriers still appears distant. And the federal government doesn’t have any direct authority to force changes.
One reason is that the weaknesses in the system are in the routing between carriers. It doesn’t help if one carrier introduces a new system — every one it connects with has to make the change as well.
“It’s kind of everybody’s problem, because it impacts the stability of the Internet, but at the same time it’s nobody’s problem because nobody owns it,” says Doug Maughan, who deals with the issue at the Department of Homeland Security.
Our fragile Internet: An unfixed glitch could leave you stranded / LJWorld.com
The free internet calling service Skype will allow group video chats for the first time.
From next week users will be able to chat with up to four other people at the same time.
Although it will be free during an initial testing period Skype will start charging for it along with some other upcoming features in three or four months.
Skype users can make video calls to each other around the world for free. The new group chat feature will be charged
Skype will continue to allow people to make normal voice or video calls and send instant messages to other Skype users for no charge.
Users pay for services such as making calls from a PC to a landline or cell phone.
Skype consumer manager Neil Stevens, said group video chat will first be available to those who use the software on Windows PCs, and the company expects to roll out a Mac version later this year.
Mr Stevens said the feature is the one users have requested most.
He added that the company also plans to focus on getting Skype on devices beyond computers, such as smart phones. Skype has been installed on 12 million of Apple's iPhone and iPod Touch devices and calls are made over WiFi. An app is being developed for Apple's iPad.
Skype will also expand its monthly subscription offerings to include calls to both mobiles and landlines in more than 170 countries from next week.
The company's existing subscription plans include one that allows calls to more than 40 countries, but they focus mostly on calls to landlines. That is generally cheaper for the company than routing calls from the internet to cell phones.
Next Wednesday Skype plans to unveil new subscriptions that let users choose which countries they want to call and whether they want to call landlines and mobiles or just one of the two.
Skype helped to pioneer internet calls and says it now has more than 560 million users world-wide.
The company was sold late last year by eBay for about £1.3billion to an investor group that includes Skype's founders.
Skype to offer group video chat for the first time | Mail Online
May 12, 2010
StreetInsider.com - Baidu (BIDU) Passes Split-Adjusted Average Daily Volume Already, On Pace for 100M Shares
Before the split
Shares of Baidu have already traded 16 million shares and it is only 10:40AM ET. Shares are on-pace to
Shares of Baidu are up $4.50 to $76. Pre split that would have been a move of $45 to $760.
StreetInsider.com - Baidu (BIDU) Passes Split-Adjusted Average Daily Volume Already, On Pace for 100M Shares
May 2, 2010
HELSINKI - Ericsson said on Tuesday it would deepen co-operation with Chinese rival Datang, giving the world's top network gear maker a better position in the growing TD-LTE field of mobile wireless.
TD-LTE technology, which incorporates LTE and time division (TD) technology like in WiMax, has recently won operator support in many large markets.
The world's largest mobile operator by subscribers, China Mobile will use TD-LTE for its next generation network. Russian operator Svyazinvest has picked TD-LTE, and Qualcomm is bidding in an Indian mobile broadband auction for TD-LTE spectrum. The new co-operation aims to combine Ericsson's leading position in mobile networks, plus experience in deploying LTE networks, with Datang's time division technology, the firms said.
As part of the agreement, Ericsson will start integrating Datang's radio network equipment using China's own 3G technology (TD-SCDMA) into its own 3G offering.
Datang owns many core patents in TD-SCDMA technology, which is expected to see seven-fold growth in subscriber numbers this year.
"We believe that our joining forces will drive the globalization of TD-SCDMA and play an important role in the industrialization of TD-LTE in the long run," Datang's Chief Technology Officer Chen Shanzhi said in a statement.
Ericsson, China's Datang in new tech co-operation
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