Chinese censors battle web users

The New York Times reports (4 March) on the issue of Chinese government control and censorship over internet providers, just ahead of the holding of the National People's Congress this weekend, saying that authorities summoned the managers of the country's main internet providers, major portals and internet cafe chains and warned them against allowing "subversive content" to appear online.

The paper says stern instructions from the authorities are in keeping with a trend aimed at assigning greater responsibility to internet providers to assist the government and its army of as many as 50,000 internet police, who enforce limits on what can be seen and said.

"If you say something the web administrator doesn't like, they'll simply block your account," said Bill Xia, a United States-based expert in Chinese internet censorship, "and if you keep at it, you'll gradually face more and more difficulties and may land in real trouble", reports the paper.

The NYT says that according to Amnesty International, arrests for the dissemination of information or beliefs via the internet have been increasing rapidly in China, snaring students, political dissidents and practitioners of the banned spiritual movement Falun Gong, but also many writers, lawyers, teachers and ordinary workers.

Already the most sophisticated in the world, China's internet controls are stout even in the absence of crucial political events, the NYT reports. The report goes on to say that in the last year or so, experts say the country has gone from so-called dumb internet controls, which involve techniques like the outright blocking of foreign sites containing delicate or critical information and the monitoring of specific e-mail addresses to far more sophisticated measures.

The paper says newer technologies allow the authorities to search e-mail messages in real time, trawling through the body of a message for sensitive material and instantaneously blocking delivery or pinpointing the offender. Other technologies sometimes redirect internet searches from companies like Google to copycat sites operated by the government, serving up sanitised search results.

According to the NYT.,if the government is investing heavily in new internet control technologies, many experts said the sophistication of Chinese users was also increasing rapidly, as are their overall numbers, leading to a cat-and-mouse game in which, many say, it is becoming increasingly difficult for the censors to prevail.

The paper says that at 94 million users, China has the world's second-largest population of internet users, after the United States, and usage, most of it broadband, is growing at double-digit rates every year.

Microsoft offer to China on piracy

Microsoft has extended its antipiracy olive branch to China, offering users of bootleg copies of Windows a 50 percent discount on a legitimate version if they come clean on how they got their pirated copy, reports The New York Times (3 Mar.).

The paper says that as part of a two-month promotion that started in February, the company is offering a Chinese version of Windows XP Home Edition and Professional Edition at 786 yuan (US$95), and 1,270 yuan (US$153), respectively. According to Microsoft's web site, the two products normally retail for about US$199 and US$299.

The NYT says that to qualify for this offer, users with unlicensed copies of Windows installed on their machines need to complete an online form in which they disclose how they obtained the bogus software.

For example, they will have to specify whether their existing Windows packages were installed by an independent reseller, bundled with their PCs at the point of sale or purchased from street peddlers, says the paper. A discount voucher will then be e-mailed to these users following their submissions, the report adds.

The paper says that in a further attempt to stem piracy, Microsoft now requires businesses and consumers in China to verify that their copies of Windows are genuine before they're allowed to download security patches and other OS updates.

The mandatory validation measure, which was also implemented in Norway and the Czech Republic last month, will be expanded to all other countries by the middle of this year, says the NYT.

Taiwan still top computer maker in 2004

Taiwanese firms produced US$67 billion worth of computer hardware in 2004, a 23 percent increase over the previous year and tops in the world, an industry report said Thursday. However, most of the goods were made in China by Taiwanese firms, according to a report in The New York Times (3 March).

The NYT says that Taiwanese companies, which have invested more than US$100 billion in China, are continuing to shift production to the mainland to capitalise on cheap labor and production costs.

The paper says that about 73 percent of the total value of the output by Taiwanese computer makers in 2004 came from their factories in China, according to the report.

The report said Taiwanese firms are making more goods in the Chinese mainland so as to achieve the best economic benefits, and this has helped them obtain orders from the big computer firms in the world, says the NYT.

The NYT says the institute's report said the US$67 billion worth of laptops, motherboards and other hardware produced by Taiwan's computer makers in 2004 was the highest in the world. It didn't say what countries came after Taiwan.

In 2004, Taiwanese companies produced US$21.8 billion worth of laptops, or 72.4 percent of the world total, says the paper.

The NYTY further reported that output of liquid-crystal-display monitors totaled US$14.4 billion, for a global share of 68 percent. Taiwanese firms produced 78 percent of the computer motherboards used in the world, and 54 percent of the traditional monitors, according to the industry report.

Apple wins court ruling

Apple Computer can force three online publishers to disclose where they got confidential information about new Apple products, a judge in the US has tentatively ruled.

The New York Times/Bloomberg News report (4 March) that Judge James Kleinberg of state court in California, refused to shield the publishers from Apple's inquiries.

Lawyers for the Electronic Frontier Foundation, a group that seeks to protect civil liberties related to technology, sought the order on behalf of the publishers, says the NYT.

Napster raises 4Q revenue forecast

Napster on Thursday boosted its fourth-quarter revenue estimate after last month's launch of Napster To Go propelled interest in its subscription music-downloading service, a rival to Apple's popular iTunes.

The New York Times/AP report (3 March) that the Los Angeles company now expects to take in revenue of US$15 million for the three-month period ending 31 March, topping the current estimate of US$14.1 million from analysts polled by Thomson First Call. Previously, Napster forecast its quarterly revenue at US$14 million.

The paper says that Napster, once a renegade file-sharing network, pinned the revised forecast to "robust" growth in subscriptions to its online music service, which allows users to download an unlimited number of songs for a monthly fee of about US$10. Napster To Go, released in early February, can transfer those songs to a portable player for US$5 more per month, says the paper.

The NYT says observers have been skeptical about Napster's approach because its songs can no longer be heard once a subscription expires. The company, however, said Thursday that it is seeing "unprecedented" interest in its service: It has added a "significant" number of new, yearlong subscribers and sold out a promotion offering three months of service with the purchase of an MP3 player within a few hours, the paper reports.

The paper says that last quarter, Napster's subscriber base grew 50 percent from the prior period to end the year with 270,000 users. By comparison, Apple said Wednesday that users have downloaded more than 300 million tracks from iTunes since the service launched in 2003.

Global microchip sales strong

Global microchip sales were strong in January, rising a better-than-expected 17.5 percent from a year earlier and falling only slightly from December, the Semiconductor Industry Association said on Thursday.

The New York Times/Reuters report (3 March) that the SIA called the results encouraging. January is usually a weak month for microchip sales following the typically robust holiday season.

The paper says January sales totaled US$18.3 billion and were down just 0.5 percent from December, which analysts attributed to high demand for pricier consumer electronics such as digital cameras and music players like Apple's iPod.

The SIA said the excess inventories that slowed growth in the second half of 2004 have been largely depleted, with the association pointing to recent data from market researcher iSuppli that showed excess inventories fell from US$1.6 billion at the end of the third quarter to US$1 billion at year-end, the NYT reports.

Meanwhile, chip factory utilisation continued to decline, as expected, throughout the second half of 2004, the SIA said, according to the NYT. Overall, factories operated at 86 percent of capacity in the fourth quarter, SIA said, and leading-edge capacity utilisation was 93 percent.

The NYT says that industry capital spending increased to about US$47 billion in 2004, roughly 22 percent of total sales.

Nokia now won't develop fuel cells

Nokia has dropped plans to develop mobile phones with fuel cells for at least the next few years, a spokesman for the Finnish company said Thursday.

The New York Times/AP reports (4 March) that the world's largest cell-phone maker, which only eight months ago signaled its commitment to fuel cells, said the technology isn't yet mature.

However, Nokia's Matti Naskali left the door open for future use of the technology, saying that "Fuel-cell technology is promising and Nokia continues to follow it closely,"

The NYT says that in a cell phone, a fuel cell would remove the need for a rechargeable battery, instead allowing a user to recharge it the same way a cigarette lighter is refilled when it runs out of butane.

A fuel cell would also allow longer talk and standby times and increased stamina for power-hungry applications such as television.

The NYT says that companies including Motorola, Toshiba, Fujitsu, NEC and Hitachi are also researching fuel-cells for mobile phones and portable computers.

Hacker helps school applicants

In the US.,a computer hacker gained access to internal admissions records at Harvard, Stanford and other top business schools, then helped applicants log on and learn their fate weeks ahead of schedule, officials said Thursday.

The New York Times reports (3 March) that few of the people who followed the hacker's directions managed to find out if their applications have been accepted, according to school officials. But many of them could end up getting rejected now that the schools are checking to see who tried to exploit the security breach.

The paper says that the unidentified hacker tapped into Business Week's online forum early Wednesday and posted instruction on how applicants could log onto the schools' web sites to check their admission status.

Dozens of business schools, including those at the Massachusetts Institute of Technology, Stanford, Duke, Carnegie Mellon and Dartmouth, were affected by the breach, with their web sites vulnerable for roughly nine hours before the problem was fixed, says the NYT.

All of the schools use ApplyYourself, an online application and notification program made by a company in the US., says the paper.

However, the paper reports that ApplyYourself's chief executive said applicants could access only their own admissions records, and there were only a small number of students who actually had a decision," "For the vast majority of applicants, decisions were not available in the system to be displayed. A blank page would appear," the chief executive said, reported the NYT.

The paper says that more than 100 applicants to Harvard tried to access the school's admissions records.

Firefox browser fixes security flaw

A new version of the Mozilla Firefox browser fixes a flaw that made users vulnerable to online fraud. The flaw allowed fraudsters to set up fake Web sites with names indistinguishable from legitimate companies, reports The New York Times/AP (3 March).

The NYT says it worked because, to a Firefox user, a web address with one Cyrillic letter in place of the Latin-script letters used in English could look indistinguishable from an address written completely in Latin script. For instance, a Cyrillic "a" looks just like the Latin "a," but if used in a Web address, it will send the surfer to a different site.

The paper says that Firefox 1.0.1, released last week, shows web addresses with foreign scripts in code, preceded by the letters "xn. So "paypal.com" with a Cyrillic "a" becomes "xn--pypal-4ve.com."

The Mozilla Foundation, which distributes the browser, said the change is temporary, but a long-term solution requires industry cooperation, reports the NYT.

The NYT says the latest "beta" version of the Opera browser, also released last week, makes a similar change. It displays web addresses in the original script only if they are registered in countries that Opera considers to have proper controls against scam addresses.

Japanese internet mogul takeover atempts

Takafumi Horie, the internet entrepreneur at the center of a takeover fight that has riveted Japan, said Thursday he welcomed the talk about restrictions on acquisitions his bid has set off in the nation.

The New York Times/AP report (3 March) that the president of internet-services company Livedoor said rules about takeovers are too undefined and ensuring fairness will protect his interests as well. Livedoor has grown over the past several years, largely from acquisitions.

The paper and AP say Horie has stirred up a controversy in recent weeks with his takeover of radio broadcaster Nippon Broadcasting System, which will give him influence over a major TV network, Fuji Television Network. Fuji TV is at the centre of a media empire, including a film studio, recording company, publisher and newspaper.

The NYT says hostile takeovers are still relatively rare in Japan, and fears are growing about not only young internet businessmen like Horie, 32, rocking the boat but also foreign investors taking over Japanese companies.

Horie said the advantage for winning a stake in old-style media is the ability to reach a massive audience because radio listeners and TV watchers still outnumber internet users, reports the NYT.

UK police dedicated paedo-protection unit

In the UK., police are proposing a new dedicated unit to tackle internet child pornography - staffed by officers, charity workers and computer experts - with resources to monitor suspect internet activity 24/7 and carry out covert ops against net paedophiles.

The Register reports (4 March) that Stuart Hyde, of the Association of Chief Police Officers, told the BBC that "law enforcement agencies, children's charities and internet service providers are united in calling for a national centre" in the face of the apparently burgeoning market for child pornography.

According to The Register, Home office figures show that, during 2003, 2,234 people were charged or cautioned in connection with downloading images of child pornography - a massive increase over 2001 when 549 offenders had their collars felt. Kids' charity NCH's internet safety advisor John Carr called the increase "astonishing", and added that it reflected the sheer number of web paedophiles identified during the 2002 Operation Ore crackdown on net child pornography, reported The Register.

The NCH says the 2003 figures - possibly representing "not a blip but a new normality", as Carr put it - require the establishment of a "UK Internet Safety Centre". How this will be funded remains a matter a concern, but Stuart Hyde admitted: "We're not expecting the government to suddenly put massive amounts of money into this," The Register further reported.

FCC strikes against VoIP blocking

The Register reports (4 March) that in the US.,Federal Communications Commission chairman Michael Powell backed enforcement action to protect VoIP traffic as the agency yesterday announced a settlement with a carrier that blocked internet users' voice calls.

The Register reports that local telco Madison River LLC has pledged to refrain from blocking VoIP calls over its network and ensure that such blocking "will not recur". It will also pay US$15,000 to the US treasury as part of the settlement.

The FCC chief has struck an anti regulation stance during his tenure, reports The Register, and says that in a statement yesterday, he backed an "enforcement context" to preserve "net freedom". He claimed this would "ensure hypothetical worriers give way to concrete facts and '” as we have shown today '” real solutions."

The Register says the burgeoning VoIP industry may take some comfort from Powell's pledge to use the FCC's enforcement unit to chase down VoIP blockers. Longer term though, they might prefer a blanket prohibition to case by case action.

Intel demonstrates entertainment PC system

Intel demonstrated its latest Entertainment PC system this week, a major update that will take advantage of the chip maker's dual-core desktop processors and 945/955 chipset - "not to mention some nifty audio enhancement software," report The Register's Tony Smith in San Fransisco.

The Register says the EPC, developed by Intel's motherboard division, was launched in 2004 based on Intel's Pentium 4 processor, 915 or 915X chipset, and Windows XP Media Center Edition 2005. It's available in the US and the UK from a number of system builders.

The report in The Register says that the new version will bring the dual-core, HyperThreading-equipped Penitum Extreme Edition into the box, along with either the 945P or 955X chipset. Both system logic products support Intel's HD Audio spec, and the new EPC will utilise SigmaTel's 9221 codec chip, which can process eight-channel uncompressed audio for distribution via an ADAT optical port. The part also boasts a 95dB signal-to-noise ratio.

The updated EPC design is due to ship with AS 2.0 in the Q3/Q4 timeframe, says The Register.

CEBIT - gadget parade to confirm tech and telecom rebound

After three slow years, the world's biggest tech and telecoms trade show CeBIT expects an increase in visitors again, as enthusiasm returns to an industry which showed in 2004 it can still generate stellar growth.

The New York Times/Reuters report (6 March) that the north German town of Hanover will be the nerve center of the US$2 trillion technology industry for the next two weeks, as the latest gadgets compete for the limelight at the annual fair.

The paper and Reuters report that m obile phone unit sales increased 30 percent last year and computer shipments rose 15 percent, thanks to a combination of price cuts and new standard features such as wireless internet access, built-in radios and high-quality digital cameras.

"Only two years ago, Intel used CeBIT as a launchpad for Centrino, and now you can hardly buy a laptop computer without Wi-Fi," said Magnus McEwen-King, the head of Broadreach, which provides Wi-Fi wireless Internet hotspots, reported the paper.

The NYT says well over 510,000 visitors are expected to brave the polar weather conditions currently ravaging northwestern Europe to roam the 27 hanger-sized halls, the fair's organisation said.

The paper further says that the lines between telecommunications and internet are also blurring as dozens of companies introduce devices to make free calls with Voice over Internet Protocol (VoIP) technology.

The NYT says that an added irritation to telecoms operators is growing speculation that internet telephony companies such as Skype are eyeing mobile devices as their latest target as they threaten to revolutionise the telecoms market. Several corded and cordless Skype phones will be shown by Siemens, Motorola, Good Way Technologies, Greatwall Infotech.

There will even be the first payphones that run on VoIP and announcements to offer WiFi on trains in Britain and Germany, reports the NYT.

The paper says that it appears inevitable that mobile phone prices in western Europe -- which rank as the most expensive in the world -- will fall as companies battle for customer loyalty in a region which has a mobile phone penetration rate of nearly 90 percent.

The NYT/Reuters report says the breadth of the show is illustrated by a range of new navigation products and global positioning systems, fuel cells by Toshiba to replace environmentally unfriendly batteries, a CD-ROM to boot a computer in Linux, face recognition to replace passwords, a 40 Gigabyte wallet-sized hard-disk drive, and even an automatic CD and DVD destroyer.

Court overturns ruling against Microsoft

A federal appeals court in California has overturned a US$521 million patent infringement ruling against Microsoft and ordered a lower court to retry the case against the world's largest software maker.

The New York Times/Reuters report (5 March) that the US Court of Appeals for the Federal Circuit said the original verdict, which found that parts of Microsoft's Internet Explorer web browser had infringed on technology developed by privately held firm Eolas Technologies and the University of California, had ignored two of Microsoft's key arguments.

The paper says the case sparked concerns that Microsoft would have to alter its internet browser, making it unable to run certain applets, or mini-applications, that run on web pages. Microsoft's browser is used by 9 of every 10 Web surfers.

But a year ago, Microsoft won a ruling by the US Patent and Trademark Office, which invalidated a claim by the plaintiffs to the browser technology that allows other mini-applications to work with Microsoft's Internet Explorer, says the NYT.

Microsoft said it was looking forward to presenting its case again. No date has been set for a retrial, the paper reports.

Apple suit pits web reporters, protections

Free speech advocates have asked a state judge in California to grant the same protections mainstream journalists enjoy to three independent Web publishers embroiled in a lawsuit that Apple Computer filed over company trade secrets they obtained.

The New York Times/AP report (4 March) that Superior Court Judge James Kleinberg had tentatively ruled that that the three must reveal their confidential sources, who are presumably employees of Apple.

During a hearing Friday, Kleinberg appeared to take a dim view of the idea that the media have the right to publish information that could only have been provided by someone breaking the law, says the paper.

Apple last year sued several unnamed individuals, called ``Does,'' who leaked specifications about an upcoming music product, code-named ``Asteroid,'' to independent web site operators Monish Bhatia, Kasper Jade and Jason O'Grady.The three publish reports on Apple Insider and PowerPage, reports the NYT/Reuters.

The paper says that if they refuse to tell Apple attorneys the names of their sources, they could be subject to criminal violations of the US Trade Secrets Act, and might not be protected by laws that ordinarily shield journalists.

The NYT says that the online reporters have refused to cooperate, and attorneys representing them argued that forcing them to divulge prized sources would create a "chilling effect" that weakens the media's ability to report in the public's interest.

Gartner: Outsourcing costs more than in-house

Outsourced customer service operations can cost almost a third more than those retained in-house, according to a new study by Gartner, reeports The New York Times/CNet (6 Mar.)

The NYT/CNet report says the research firm found that outsourced operations are 30 percent more expensive than the top quartile of in-house customer service operations. Gartner said businesses often fail to take hidden costs, such as in-house backup support to the outsourced function, into account.

The paper and CNet further reported that Gartner also said 80 percent of organisations that outsource their customer management operations purely to cut costs will fail to do so, while 60 percent of those who outsource parts of the customer-facing process will have to deal with customer defections and hidden costs that outweigh any potential savings offered by outsourcing.

The worldwide market for customer service outsourcing is predicted to grow from US$8.4 billion in 2004 to US$12.2 billion in 2007, although the offshore element will still only account for five percent of that market by 2007, according to Gartner.

The NYT and Cnet reported that the Indian business process outsourcing, or BPO, start-ups--as opposed to the big established players like Infosys Technologies, Tata Consultancy Services and Wipro Technologies--are also set to undergo radical consolidation, with Gartner predicting 70 percent of the top 15 will be acquired, merge or disappear by the end of 2005.

ChoicePoint up against law suits

In the US., ChoicePoint, the commercial data broker that inadvertently sold tens of thousands of consumer records to thieves masquerading as small-business clients, has announced that it is the subject of at least two consumer lawsuits, a barrage of inquiries from state attorneys general and two federal investigations - including one into stock sales made by two executives before the theft was made public.

The New York Times reports (5 March) that ChoicePoint also announced that as a result of the security breach, it would no longer sell sensitive consumer data to small-business clients, focusing instead on the large corporate and government accounts that make up its core business.

Both the Securities and Exchange Commission and the Federal Trade Commission, the company said, were looking into the security breach, as well as into its actions before and after the security breach was discovered. The FTC confirmed that an investigation had begun but would not discuss the details. The SEC would not comment, reported the paper.

The NYT says the trade commission will examine the company's compliance with federal US commerce laws, including the Fair Credit and Reporting Act, which governs the handling of consumer data. Privacy rights groups have argued that companies like ChoicePoint were selling data in ways that violated the Fair Credit Reporting Act, among other laws.

According to the paper, the agency has requested information and documents regarding the company's process for establishing the credentials of its customers, who have access to an assortment of public and private records, including court filings and credit information.

The NYT says the accusations of inappropriate trading have been gathering steam since the company announced two weeks ago that as many as 145,000 American consumers had been affected by the breach, which the company said it discovered in late September.

ChoicePoint has said that it delayed disclosure of the breach for nearly five months at the request of law enforcement officials in California, who were working with the company, the paper reports.

The paper says a ChoicePoint spokesman said the effect of the inquiries, the lawsuits and other fallout from the security breach appears to have contributed to ChoicePoint's decision to curtail sales to small-business customers - which represent about 3 percent of its overall business.

The move, the company predicted, would reduce 2005 revenue by US$15 million to US20 million.

Nortel's new president

Nortel Networks, North America's largest maker of telecommunications equipment, said Friday that Gary Daichendt, a former official of Cisco Systems, would become president and chief operating officer.

The New York Tmes reports (5 March) that those responsibilities were previously held by William Owens, who has been chief executive since April. Mr. Owens was recruited from the board after the firing of the former chief executive over financial irregularities. Mr. Daichendt will assume his new duties on 14 March.

Yahoo launching mobile games studio

Yahoo says it has acquired technology to take its popular web-based parlor and card games from personal computers to mobile devices.

The New York Times reports (4 Mar.) that in a deal announced Friday, Yahoo said it will integrate technology from New Jersey-based Stadeon to permit multiplayer games across multiple platforms. Terms of the acquisition weren't disclosed.

The paper says it means that someone on their cell phone could play dominoes in real time against a friend playing the same Yahoo game on a PC. Likewise, two cell phone users on different service providers could compete against each other.

According to the NYT.,Yahoo has been increasing its presence in the emerging mobile game market, which saw estimated US revenues of about US$204 million in 2004, according to In-Stat/MDR, a market research firm.

The company recently launched a mobile games studio to develop casual multiplayer titles. Currently, six games are available for Verizon Wireless customers, but there are plans to make them available for other major US carriers, the paper reports.