BSNL Teams Up With Microsoft, Launches Managed Business Mail

State-owned Bharat Sanchar Nigam Limited (BSNL) has entered into a long-term partnership with Microsoft to launch BSNL Managed SaaS (Software as a Service) in India. This partnership will enable BSNL to offer hosted solutions on core productivity, collaboration and line of business applications to business customers. BSNL has also launched BSNL Managed Business Mail today – the first offer resulting from this partnership.

Based on Microsoft Exchange platform, BSNL Managed Business Mail moves beyond conventional e-mail options to empower businesses with tools to increase productivity, mobility and collaboration at an affordable monthly fee. This will provide a range of services for businesses across enterprise, SMBs and public sector segments to enhance communication coordination by enabling them to share e-mail messages, contacts, calendars, task lists and documents from any device (PC or mobile phone).

The partnership and launch marks BSNL's foray into managed business solutions based on the SaaS model. Since this service will be delivered via the Internet, users will save on upfront costs related to hardware, licences and installation for their IT infrastructure. Business owners will also be able to focus on their core business tasks – without any disruptions and distractions pertaining to IT headaches like security patches, software updates, monitoring and backups. In turn, this will eliminate need for in-house IT management manpower.

Commented Kuldeep Goyal, chairman and managing director, BSNL, "We are proud to announce a long-term partnership with Microsoft India to offer a wide range of managed services based on the SaaS model and are confident of the value that this will deliver to our customers. We are equally proud to launch BSNL Managed Business Mail as our first SaaS-based managed service and the first under this partnership. Managed Business Mail is an innovative messaging and collaboration service for Indian businesses that will provide enterprises and SMBs with rich enterprise-class e-mail applications that deliver 24X7 access and significant productivity benefits – all at an affordable price."

BSNL Managed Business Mail will be available in four editions at affordable prices starting from Rs 420 per month.

"The unique feature of BSNL's Managed Business Mail will be its availability from the mobile platform. This implies that the service will be accessible on smartphones of any service provider. This unique facility will seamlessly extend the best in class experience benefits of the service to end consumers on the move," added Goyal.

Commenting on the partnership, Rajan Anandan, managing director, Microsoft India, said, "Customers find value in a combination of software plus services delivered via the Internet, thus making owning and managing IT more affordable and convenient. We believe that BSNL's foray into the S+S model will provide ample value to businesses looking to leverage technology to maximize productivity while ensuring lower spends - especially in today's cost controlled environment. We are excited about our partnership with BSNL for their managed services business and look forward to further strengthening our association."

"We believe that Microsoft Hosted Exchange is a compelling proposition that will help us deliver more choice, flexibility and affordability for customers. We shall continue to work closely with Microsoft India in the near future to bring a wider range of hosted applications to the market," added Goyal.

Thing Labs to Launch New Twitter App In Coming Weeks

Jason Shellen, founder of Thing Labs, the startup formerly known as Plinky, is keeping details about its new social media product tightly under wraps — except to say that initially it will only work in conjunction with Twitter. While other application developers focus their attention on multiple social network sites, Thing Labs decided to develop its latest application for the API friends and fellow ex-Googlers Biz Stone and Evan Williams created.

Thing Labs is primarily familiar with the Twitter API via the friendships of Shellen and VP of Technology Chris Wetherell with Stone and Williams, so it seemed natural to start building its new application on that platform first. Wetherell, a former senior software engineer at Google, even spent a few months working on projects at Twitter after he left the search giant earlier this year.

"Chris and I have been using Twitter for about three years now — we were in the first group of users." Shellen said. "We're big fans and believers in Twitter as a platform and it's a great place to invest our time."

The upcoming release of this new social media product — which is expected to launch in a few weeks — was also the impetus behind Thing Labs' name change. Shellen's startup was originally named after its first social media product, Plinky. Launched six months ago, Plinky is a web application that prompts users to answer a question — topics run the gamut from movies to travel — and lets them to post their answers on Facebook, Twitter or blogs.

Shellen said the Thing Labs' social media application will roll out in a few weeks. In addition to Wetherell, who joined the company a few months weeks ago, Dolapo Falola is leaving a senior engineering position with Google and will join the startup in July, making Thing Labs a popular destination for the growing network of ex-Googlers.

After Indians, Sri Lankan students attacked in Australia

After Indians, a group of students from Sri Lanka have been allegedly attacked in Australia, with three men smashing the windows of their home and taunting them with "racist insults" in capital Canberra.

Police are investigating allegations of attacks against a group of Sri Lankan students at their home, ABC News reported.

It is alleged that three men smashed the front windows of the students' house in Macquarie in north Canberra after an unsuccessful attempt to crash a party.

The students said a car window has also been broken and that they have been taunted with "racist insults".

One of the students, Dijula Wijesuriya, said he has been threatened with a knife. "This guy comes up and takes out a knife and says 'get out of our streets'," he said.

Wijesuriya said they have been living in fear, especially considering the recent violence against Indian students in Sydney and Melbourne.

"We really didn't go anywhere else, we just stayed at home, just go to uni and come back home straight away and lock the doors and stay inside."

India Australia Association of Canberra president Madhu Kalia said she is surprised by the incidents.

"So far Canberra, it has been alright, there have been no attacks on students," she said.

Police said they have investigated several incidents but have not received any reports that they have been racially motivated.

WHO declares swine flu pandemic

The World Health Organization told its member nations it was declaring a swine flu pandemic on Thursday - the first global flu epidemic in 41 years - as infections climbed in the United States, Europe, Australia, South America and elsewhere.

In a statement sent to member countries, WHO said it decided to raise the pandemic warning level from phase 5 to 6 - its highest alert - after holding an emergency meeting on swine flu with its experts.

The long-awaited pandemic decision is scientific confirmation that a new flu virus has emerged and is quickly circling the globe. It will trigger drugmakers to speed up production of a swine flu vaccine and prompt governments to devote more money toward efforts to contain the virus.

"At this early stage, the pandemic can be characterized globally as being moderate in severity," WHO said in the statement, urging nations not to close borders or restrict travel and trade. "(We) remain in close dialogue with influenza vaccine manufacturers."

On Wednesday, WHO said 74 countries had reported nearly 27,737 cases of swine flu, including 141 deaths.

The agency has stressed that most cases are mild and require no treatment, but the fear is that a rash of new infections could overwhelm hospitals and health authorities - especially in poorer countries.

Still, about half of the people who have died from swine flu were previously young and healthy - people who are not usually susceptible to flu.

Swine flu is also continuing to spread during the start of summer in the northern hemisphere. Normally, flu viruses disappear with warm weather, but swine flu is proving to be resilient.

The last pandemic - the Hong Kong flu of 1968 - killed about 1 million people. Ordinary flu kills about 250,000 to 500,000 people each year.

Many health experts say WHO's pandemic declaration could have come weeks earlier but the agency became bogged down by politics. In May, several countries urged WHO not to declare a pandemic, fearing it would cause social and economic turmoil.

"This is WHO finally catching up with the facts," said Michael Osterholm, a flu expert at the University of Minnesota who has advised the US government on pandemic preparations.

Despite WHO's hopes, raising the epidemic alert to the highest level will almost certainly spark some panic about spread of swine flu.

Fear has already gripped Argentina, where thousands of people worried about swine flu flooded into hospitals this week, bringing emergency health services in the capital of Buenos Aires to the brink of collapse. Last month, a bus arriving in Argentina from Chile was stoned by people who thought a passenger on it had swine flu. Chile has the most swine flu cases in South America.

In Hong Kong on Thursday, the government ordered all kindergartens and primary schools closed for two weeks after a dozen students tested positive for swine flu - a move that some flu experts would consider an overreaction.

In the United States, where there have been more than 13,000 cases and at least 27 deaths from swine flu, officials at the US Centers for Disease Control and Prevention said the move would not change how the US tackled swine flu.

"Our actions in the past month have been as if there was a pandemic in this country," Glen Nowak, a CDC spokesman, said on Thursday.

The US government has already taken steps like increasing availability of flu-fighting medicines and authorizing $1 billion for the development of a new vaccine against the novel virus. In addition, new cases seem to be declining in many parts of the country, U.S. health officials say, as North America moves out of its traditional winter flu season.

Still, Osterholm said the declaration was a wake-up call for the world.

"I think a lot of people think we're done with swine flu, but you can't fall asleep at the wheel," he said. "We don't know what's going to happen in the next 6 to 12 months."

France Telecom & Telstra in talks with Maxis to buy minority stake in Aircel

France Telecom and Telstra of Australia are in talks with Malaysia's Maxis Communication to buy a minority stake in Indian telecom operator Aircel, in yet another sign that the ongoing slowdown and credit crunch are having a negligible impact on deal activity in the telecom sector.

The talks between the two overseas players and Maxis revolve around France Tele buying a 20-25% stake in Aircel, a dominant player in Chennai and Tamil Nadu. Aircel, which is one of the major regional players in India, is in the midst of a $5-billion expansion plan that will see it becoming a pan-India player.

Meanwhile, Saudi Telecom, which owns 25% in Aircel parent Maxis, is likely to increase its stake in the company to 35% for about $1 billion. The money from the sale of Maxis' stake will also be used to invest in Aircel. Goldman Sachs is advising Saudi Telecom in its transaction with Maxis. The deal with Saudi Telecom is expected to be completed within a month.

Estimates of the valuation of Aircel, which has a subscriber base of 19.6 million, vary between $7 billion and $8 billion. France Tele, which is not looking to buy a majority stake, will end up paying about $1.4-2 billion if the deal goes through at this valuation, people close to the development said.

The Indian telecom sector is perhaps one of the few sectors in the economy that is still witnessing strong M&A deal activity despite an economic slowdown. In the past 10 months, about $5 billion of deals have been concluded, including a mega $2.7-billion transaction that saw Japanese giant NTT DoCoMo buying 26% in Tata Teleservices.

Indian telecom companies, too, are growing at a scorching pace with monthly subscriber additions rising to more than 10 million a month. At this rate, Indian subscriber base is expected to leap past the 500 million mark in double quick time.

Aircel on course to widen pan-India reach by June 2010

The continued high growth is of great interest to foreign investors. Impending developments such as auction of spectrum for 3G (third generation) and broadband wireless access (BWA), besides the entry of MVNOs (mobile virtual network operators), offer further growth opportunities," said Salil Pitale, head (telecom & media), at Enam Investment Banking.

For France Telecom, Europe's third-largest phone company which owns the Orange brand, it will be an opportunity to re-enter the world's fastest growing telecom as it faces a slowdown in its home turf and in other mature markets.

In response to an e-mail, an Aircel spokesperson said, "We are not aware of any discussions with France Telecom about this matter. Maxis Communications and its partners remain firmly committed to the accelerated growth and development of Aircel to be a successful pan-India operator." A France Telecom spokesperson said, "We do not comment on market rumours."

France Telecom first approached Maxis in August last year, just before the global market meltdown. "At that time, it was also in talks with Tata Teleservices (TTSL). Negotiations with Maxis were revived after NTT DoCoMo clinched the deal with TTSL," a person familiar with the discussions told ET.

Maxis was also in talks with AT&T last year for selling a similar stake, but the deal could not go through because of differences in valuation. Talks between France Tele are still at a preliminary stage and the deal may also fall through because of Maxis' insistence that the prospective investor also purchase a small stake from Maxis. France Tele, on the other hand, wants the investment to go into the company, that is Aircel, and is not keen on buying directly from Maxis.

Maxis owns 74% in Aircel while the rest is held by Chennai-based Reddy family, promoters of Apollo Hospitals. France Tele had held a stake in Mumbai-based BPL Mobile for many years before exiting in 2003. In 2007, its group company Orange Business Services acquired GTL's enterprise and managed services division. Subsequently, it bagged NLD and ILD licences in India. A stake in a mobile firm now will complete France Telecom's India story.

Aircel is currently in a money-guzzling mode, with the target to complete pan-India footprint by June next year. Ananda Krishnan, the owner of Maxis, also needs money to pump into Natrindo Telepon Seluler, a telecom firm in Indonesia which has a 3G licence. Plus, he bought out NTT DoCoMo from Sri Lanka Telecom in 2007 and that business also requires continued investments.

In a bid to fund these plans, Ananda delisted Maxis in June 2007 in a $12-billion deal and within days, he sold 25% of it to Saudi Telecom for over $3 billion. Due to this, Saudi Telecom has an effective 18.5% stake in Aircel. Dilution of another 25% in Aircel will help Ananda's Maxis raise around $2 billion at a time when global credit scenario is not very positive.

At the same time, India's telecom growth story continues to attract international investor interest, with all the major telcos making a beeline for India. This is despite the presence of 12 players and entry of four more telcos later this year. For Ananda, stake sale could be an opportunity to raise money without giving any controlling rights.

Low-profile billionaire Ananda Krishnan, whose business empire stretches from telecom and media to power and construction, is known for buying and selling businesses. In May last year, he sold Excel, the giant exhibition venue in London's Docklands, for around $230 million, to a group backed by the crown prince of Abu Dhabi. He then bought a 20% stake in British regional newspaper chain Johnston Press and is widely believed to be interested in setting up a global media empire.

Infy, EDS & IBM bag $1.2-billion Telstra deal

Australian phone firm Telstra on Tuesday said it has awarded around $1.2-billion outsourcing contracts to Infosys, EDS and IBM, as
part of a major vendor consolidation exercise the company started last year.

ET had reported in March earlier this year that Infosys has won over $100 million contract from Telstra, and EDS and IBM were front-runners for new outsourcing contracts to be awarded by Telstra.

As part of Telstra' latest outsourcing contracts, EDS and Infosys will share $450 million application development and maintenance contract over five years, and IBM will walk away with $750 million deal for managing the phone firm's IT infrastructure.

"EDS, IBM and Infosys are important IT transformation partners and we look forward to continue our relationship," said John McInerney, Telstra CIO and GMD Information Technology.

While Telstra did not comment if Satyam continues to be a vendor, experts said Satyam (now a Tech Mahindra company) has lost the Telstra account.

Telstra had undertaken a vendor consolidation exercise to reduce its IT service providers from four — EDS, IBM, Infosys and Satyam — to three.

The consolidation was aimed at bringing down the cost of managing its IT systems. The phone firm plans to bring down the number of IT systems from about 1,350 now to almost 300 by 2010.

Foul play not suspected in Motwani's death: Police

Police do not suspect foul play from preliminary evidence gathered in the mysterious death of India-born Stanford professor Rajeev
Motwani, the mentor and adviser of founders of top companies like Google and PayPal.

There is no initial evidence of foul play in the drowning mishap, Atherton police Sgt Tim Lynch was quoted as saying by local newspaper San Jose Mercury News.

Lynch said an autopsy report is awaited to carry forward the probe into the incident.

"We're kind of in limbo... It could have been a simple accident or many other things," he added.

Motwani (47) was found dead in the backyard swimming pool of his Palo Alto home in California on Friday.

Local media reported that Motwani, who did not know how to swim, may have slipped into the pool and drowned. Paramedics were summoned when his body was found.

Lynch said firefighters and a police officer pulled Motwani's body from the bottom of the pool.

The news of Motwani's death sent shock waves throughout the Silicon Valley and the tech world globally, as he was known to be the master brain behind several key advancements in the world of Internet, including Google and PayPal.

Meanwhile, friends and family members of Motwani have opened the "Rajeev Motwani Foundation" in his honour, requesting people to send in their contribution.

Google, Microsoft hiring under scanner

The US Justice Department is probing possible collusion in hiring by Microsoft Corp, Google Inc and Yahoo! Inc and several other compa nies, said two people familiar with the investigation.

The investigation may include a dozen technology companies, said the people, who spoke on condition of anonymity.

The Justice Department faces the difficult task of proving that there is an explicit agreement between the companies that they wouldn't hire employees from their rivals, said David Balto, a former antitrust attorney with the Federal Trade Commission.

The investigation adds to the scrutiny of technology companies under President Barack Obama's administration. The makeup of Google's and Apple's boards has already drawn the scrutiny of the U.S. Federal Trade Commission, and the Justice Department is looking into a settlement with publishers over Google's book-scanning project.

Google, based in Mountain View, California confirmed it has been contacted by the Justice Department and is cooperating with the investigation, said spokesman Adam Kovacevich. Yahoo, based in Sunnyvale, California, is also cooperating, said company spokeswoman Kim Rubey. Microsoft spokesman Jack Evans, declined to comment.

Justice Department spokeswoman Gina Talamona declined to comment.

Technology companies often trade workers as they seek to lure the best talent, and sometimes end up in conflict. In 2005, Microsoft, the world's largest software maker, sued after Google lured away Kai-Fu Lee to run a development center in China. The companies settled the suit.

Satyam may lay off 5,000

full board meeting of Satyam Computer is likely to be held on June 11 after its new owner Tech Mahindra assumed charge and the boar d may draw a consensus on the sensitive issue of laying off as many as 5,000 employees in phases.

Sources said the meeting is scheduled to be held on next Thursday or Friday and for the first time the full board -- six government-nominated members and four member from Tech Mahindra (through its arm Venturebay Consultants) -- will discuss the business strategies.

A company spokesperson said as and when the meeting takes place, there will be comprehensive discussions on all related issues. He, however, did not divulge details of the agenda or whether or not the meeting would look at ways on how to rationalise the employee strength.

Sources said given the sensitivities of the situation, the board is likely to draw a consensus on the 'lay offs' to be undertaken which may take the shape of keeping 5,000-10,000 people on the bench (reserve).

Tech Mahindra CEO Vineet Nayar had recently said Satyam has 10,000 surplus staff and the company would look at the 'least painful' ways to handle the situation.

"It is a question of revival and viability", they said. Last week, Corporate Affairs Minister Salman Khurseed had said the government will not turn a blind eye to any lay offs in Satyam.

Google launches 'Google Squared'

Google, already the king of Internet search, rolled out an experimental new search product called "Google Squared."

Google Squared does not provide a list of links to Web pages, like with a traditional Google search, but presents information derived from a query in a spreadsheet-like grid called a "square."

Users of google.com/squared can then build, modify and refine their "square" through further Web searches.

"Unlike a normal search engine, Google Squared doesn't find webpages about your topic -- instead, it automatically fetches and organizes facts from across the Internet," Google said in a preview of the product last month.

In a blog post on Wednesday, Google said Google Squared could be useful when a user needs to make multiple searches to find the information they want.

"It essentially searches the Web to find the types of facts you might be interested in, extracts them and presents them in a meaningful way," Google said.

"If your square isn't perfect at the beginning, it's easy to work with Google Squared to get a better answer," Google added.

The Mountain View, California-based Internet search giant cautioned that Google Squared remains experimental and the technology behind it "is by no means perfect."

Yahoo, eBay look to sell start-ups

Many Internet and media companies that were busy buying start-ups in the boom years could shed assets they no longer deem central to the ir business, as the recession imposes an age of frugality.

Scathed by the heavy losses they incurred when the dotcom bubble burst in 2000, tech companies moved quickly to cut costs and focus on staying profitable as the current recession hit.

Now, as the doldrums linger, many are taking a hard look at the start-ups they bought during the good times, many of which were never a good fit. Some of those acquisitions could wind up right back on the sales block.

Venture capitalists, who invest in start-ups and recover their money by taking them public or selling them, say the dealmaking has already begun. Many expect more sales and spin-offs in the next few months as companies squeeze their assets for cash and reassess business strategies.

"In good times, companies acquire, in bad times, they divest," said Todd Dagres, a venture capitalist whose firm Spark Capital funded hot microblogging site Twitter.

Dagres and other venture capitalists said companies increasingly are seeking out private investors to gauge their interest in dealmaking. The talks usually center on small units that don't carry their own weight, or are no longer considered strategic.

"What you're seeing is very active triage," said Dan Nova, a venture capitalist at Highland Capital Partners. "As Fortune 500 companies focus or refocus their core strategic mission, they're deciding if those acquisitions are still consistent with that mission," Nova said. "If they're not, (they will) try to sell or shut them down."

In recent months, top Web companies like Yahoo Inc and eBay Inc have begun cleaning out their closets. As part of a turnaround strategy under its new chief executive, Carol Bartz, Yahoo has begun axing money-losing properties, such as Geocities, which it acquired in 1999.

Online auction giant eBay recently said it would spin off Skype, the popular Web-based phone company it bought for $2.6 billion in 2005. eBay also sold back StumbleUpon, a start-up that helps people discover online content, to its founders and venture capitalists, two years after buying it for $75 million

Google Tests Scripting Feature for Online Apps

Google will add scripting capabilities to Google Docs, allowing organizations to customize its online applications and automate tasks, the company said Wednesday.

Google plans to sign up about 1,000 customers over the next few weeks to test the feature, called Google Apps Script. It isn't saying yet when Apps Script will be widely available. Google Docs users can apply here to try it out.

It will be tested initially in Google Spreadsheets and extended to other Google Docs applications over time, said Jonathan Rochelle, product manager for Google Docs, in a press briefing at the Google I/O conference.

The scripting will allow organizations to build custom functions in spreadsheets, like translating figures from inches to millimeters, or translating text from one language to another. It will also enable applications to be linked together, allowing a user to send an email from within a spreadsheet, for example, or access a calendar from a list of addresses.

The company posted a video and some information about Apps Script in its Enterprise Blog.

The scripting should help Google to compete better with Microsoft's widely used Excel spreadsheet software, but it will also open a new front for security attacks and other potential issues.

"The nature of scripting is such that it could be easily abused," Rochelle acknowledged. "We want to make sure people can't make a mistake [such as] they coded something they don't know is happening."

Google will work to make it "bulletproof" before it's released to the public, he said. The company described it as "a puppy who's still in training," suggesting it has more work to do on it.

Google Apps Script is based on JavaScript, with object-based extensions added by Google, making it easy to learn, according to Rochelle. "It really is JavaScript, except there are certain things we don't let you do," he said.

There is not currently a way to import Excel macros, he said, but Google is considering that for the future. It expects Apps Script to appeal especially to systems integrators, who have been asking for it, he said.

Excel still has many more features and capabilities than Google Spreadsheets, but Rochelle argued that "user satisfaction" is a better measure by which to compare the products. "If 80 percent of people don't use the features then it doesn't matter" he said.

Several partners are at the show who offer integration services and develop add-on tools for Google Docs. Ed Laczynski, CTO of LTech, said his company has migrated "hundreds of thousands" of users from on-premise software to Google Apps. The company just released a tool that lets users download and backup their documents to a local disk.

Oracle is also in on the act. The company is about to release a beta tool that will let users of its Siebel customer relationship management software import and export data from Google Docs, said Dipock Das, a senior director with Oracle's CRM group.

 

Lawyer seeks trimmed prison time for Phil Spector

A lawyer for Phil Spector said in a court document filed Wednesday that the music producer maintains he did not kill actress Lana Clarkson and is not responsible for her death.

Attorney Doron Weinberg wrote in a memorandum to the sentencing judge, however, that Spector's prison sentence on a second-degree murder conviction should be 18 years to life in prison.

The court document asked that a sentencing enhancement for use of a gun be trimmed to three years, instead of the four requested by Deputy District Attorney Alan Jackson. The murder conviction alone mandates 15 years to life in prison.

Spector, 69, was scheduled to be sentenced Friday. He was found guilty April 13 in the shooting death of Clarkson at his home in 2003. Clarkson, who starred in the 1985 cult film "Barbarian Queen," died of a gunshot fired in her mouth as she sat in the foyer of Spector's mansion.

Weinberg had said the conviction would be appealed.

Weinberg also said in the court document that an account of Clarkson's death provided by Jackson in a memorandum last week was "based on conjecture, not facts."

Jackson had offered a theory of the shooting that was not proven by evidence at the trial, suggesting that Spector threatened Clarkson with a loaded gun as she attempted to leave his house and "the end result ... was Lana being shot through the mouth as she recoiled in fear."

Jackson suggested those facts could be deduced from the fact that Spector had threatened women with guns in the past in similar circumstances.

There were no eyewitnesses to the shooting. Weinberg wrote that his client "asserts, as he has steadfastly maintained since February 3, 2003, that he did not kill Lana Clarkson, and he is not responsible for her death."

In arguing for a lesser sentence on the gun charge, Weinberg disclosed that during a private conference with the judge over jury instructions before the verdict, prosecutors had argued "that the facts proven at trial could support the conclusion that the death of Lana Clarkson resulted from an accidental discharge of the weapon during a misdemeanor brandishing."

Weinberg said given that suggestion, the additional term for gun use should be reduced to the minimum of three years.

Time Warner to spin off ailing AOL

Time Warner announced plans Thursday to spin off its troubled AOL Internet unit by the end of the year, bringing to a close one of the most disastrous corporate mergers in history.

The US media-entertainment giant said its board had approved a separation from AOL, formerly known as America Online, to make it an independent, publicly traded company.

"We believe that a separation will be the best outcome for both Time Warner and AOL," Time Warner chairman and chief executive Jeff Bewkes said in a statement.

"We believe AOL will then have a better opportunity to achieve its full potential as a leading independent Internet company."

Time Warner said that before the spin-off goes ahead it will purchase the five percent in AOL owned by Internet search and advertising giant Google, which paid one billion dollars in 2006 for the stake.

Time Warner owns the remaining 95 percent of AOL, which saw its heyday as a provider of dial-up service in the early days of the Internet but has been losing ground as consumers switch to high-speed or broadband services.

Once the proposed separation is complete, Time Warner shareholders will own all of the outstanding interests in AOL, according to the plan.

Time Warner said it aims to complete the separation, which will have to be approved by the Securities and Exchange Commission, around the end of the year.

An independent AOL would be free to focus on growing its Web brands and services and its advertising business, according to Time Warner.

"This will be a great opportunity for AOL, our employees and our partners," said AOL chairman and chief executive Tim Armstrong, who was hired away from Google in March to run the division.

"Becoming a standalone public company positions AOL to strengthen its core businesses, deliver new and innovative products and services, and enhance our strategic options," Armstrong said.

Time Warner merged with America Online in 2001 at the height of the dot-com boom, with AOL using its inflated stock as a currency for the transaction.

But the marriage of old and new media behemoths baptised as AOL Time Warner quickly went sour as the benefits promised to shareholders failed to materialize.

AOL was valued at more than 150 billion dollars when the ill-fated merger was announced but its worth collapsed dramatically as the dot-com bubble burst.

Time Warner was forced in 2002 to massively write down the value of the Internet unit and the AOL name was removed from the group's corporate title in 2003.

In the years since the merger, AOL weathered an accounting scandal and was relegated to being just one of the divisions in Time Warner's empire, which includes Time magazine, Warner Bros. studio and the CNN and HBO television networks.

Billionaire corporate raider Carl Icahn once described the merger as a "colossal mistake."

AOL is currently the number four Web gateway after Google, Microsoft sites and Yahoo! and has been trying to refashion itself recently as a popular one-stop portal.

Time Warner shares were down 0.96 percent in New York at 22.78 dollars

Microsoft revamps search engine, dubbed "Bing"

Microsoft Corp is revamping its search engine to counter the dominance of Google Inc in the web search and related advertising business.

The world's largest software company, which is still in talks with Yahoo Inc over a potential partnership, has long been determined to play a major role in the lucrative web search market after watching upstart Google take a stranglehold.

Microsoft, which has been testing the search engine internally under the name Kumo for several months, plans to introduce the new service, re-christened "Bing," over the next few days, with a full launch next Wednesday.

Advertising Age reported earlier this week that Microsoft was planning a $80 million to $100 million ad campaign to promote Bing. Microsoft declined comment on the report.

The Redmond, Washington-based firm has lots of ground to make up. Last month Google took 64.2 percent of U.S. Internet searches -- up half a percentage point from the month before -- handling 9.5 billion out of a total of 14.8 billion searches.

Yahoo was a distant second with 20.4 percent of searches and Microsoft third with 8.2 percent, both down slightly from the month before, according to data firm comScore.

Both Google and Yahoo have recently introduced new features in their search engines to attract users, making Microsoft's task even harder.

Telstra - Nine new SME apps

Telstra has released a raft of online software applications, available to Australian SMEs with the Telstra T-Suite software-as-a-service platform, says WebWire.
 
According to the company, the T-Suite applications will be available to lease online for a monthly fee without expensive upfront licensing fees, meaning businesses can preserve vital cash reserves during the current tough economic climate.

Telstra adds that Australian small businesses in all industry sectors will be able to generate employment agreements and manage everyday staff issues with easy-to-use HR processes and templates from Workforce Guardian that are updated online to reflect changes in employment law.

McAfee, EMC team up vs Symantec in online backup

McAfee Inc, the No. 2 computer security company, plans to team up with EMC Corp to offer online PC backup services, and announced the acquisition of a company that protects ATMs against hackers.

The company plans to offer consumers unlimited Web-based backup for personal computers with EMC Corp's Mozy division for $50 to $60 a year, Executive Vice President Todd Gebhart said at a McAfee's analyst meeting on Friday.

Earlier in the day, McAfee said it would pay $33 million to buy Cupertino, California-based SolidCore Systems Inc, adding products that help companies protect ATMs, cash registers and other point-of-sale systems used by retailers, along with multifunction printers and other specialized computer devices.

It would pay another $14 million if SolidCore's business meets certain financial targets.

SolidCore's products are used by more than 100 financial institutions and in more than 15,000 retail stores, McAfee said.

McAfee Chief Executive Dave DeWalt said he would continue to look to make small- and mid-sized acquisitions of products that the company can cross-sell with existing products.

"I think people here would expect three or four more things like SolidCore," said Cowen & Co analyst Walter Pritchard.

McAfee said it expects the acquisition of SolidCore to be slightly dilutive to profit, excluding items, in the current quarter, ending June 30, which is when it expects the deal to close.

The company plans to introduce the PC backup service in the second half of the year, making it a late player into a market dominated by bigger rival Symantec Corp, its partner EMC and privately held Carbonite.

A few years ago McAfee beta tested a backup service that it hoped to launch, but ditched plans to bring that to market.

DeWalt reiterated his comments from a Thursday interview with Reuters, saying that business had improved in May from April. "So far, good pace. We are on a roll here," DeWalt said.

Shares in Santa Clara, California-based McAfee rose 27 cents, or 0.7 percent, to $38.30, while the Nasdaq Composite Index was little changed.

Google Pulls Trademark Restrictions for U.S. Ads

Google is loosening its grip on trademarks included in advertisements through its AdWords service. The search giant said Thursday it will allow companies to place the terms of a trademark in the copy of text advertisements.

"Under this policy change, advertisers will be able to create more specific, less generic ad copy targeted to narrowly tailored landing pages," said Deanna Yick, a Google spokesperson. "Users and consumers shopping online will have more options and relevant choices."

The move will bring Google's policy on the use of trademarks in ad text more in line with the industry standard, according to Dan Friedman, a representative from Google's Inside AdWords team, in an official blog post.

Companies with certain criteria will be able to use trademark terms in ad text in the U.S. even if the company doesn't own the trademark or doesn't have approval from the trademark owner.

"For example, under our old policy, a site that sells several brands of athletic shoes may not have been able to highlight the actual brands that they sell in their ad text," Friedman said. "However, under our new policy, that advertiser can create specific ads for each of the brands that they sell."

In Hot Water

While Google says it's doing companies and users a favor, brand advertisers may think otherwise.

Google's move may land the company in more hot water and put the company on the defense against potential trademark lawsuits similar to one already filed against the company.

On Monday, FPX LLC, also known as Firepond, filed a class-action complaint against Google for using trademarks it owns, including Firepond and Firepond CSQ.

In court documents, Firepond says it has suffered and has been injured in its business and property and the damage it has suffered is both economic and non-economic in nature.

"Google's change in policy is further indication of the company's failure to honor and respect the right of federally registered trademark owners," said Scott Kline of Andrews Kurth LLP, one of the law firms representing Firepond. "Even competitors Yahoo and MSN are willing to take down infringing links upon notification of a federally registered trademark. We are disappointed by the change in policy, but believe it only serves to strengthen our client's claims."

Move Is Pro-Consumer

Others, however, believe the move by Google is pro-consumer. The Computer & Communication Industry Association said Google's change will be good for consumers.

The change aligns Google's policy more closely with current industry standards on sponsored search text, said CCIA counsel Matthew Schruers. "By allowing ad text to make references to others' trademarks -- a practice permitted and encouraged by trademark law -- Google's new policy will improve consumers' ability to find products online and to obtain better information about the products they want to buy," he said.

Paul Levy, counsel for Public Citizen, a Washington, D.C.-based nonprofit public-interest organization, said it's a modest step in the right direction.

"Generally speaking, it seems to me that modifying their procedure so that it is easier for those that have information to communicate to consumers that they have Web sites in which they may be interested, enabling them to communicate more truthful information about what is in those Web sites, is a good thing," Levy said.

"I would also say that I'm particularly glad Google is not in retreating but rather is moving forward with the AdWords program that provides potential for increased competition for comparable goods and services," Levy added. "My regret is that they are not allowing use of keywords for direct-competitor ads."

Citrix Leverages Amazon’s Cloud

Citrix has pushed out a cloud solution called Citrix C3 Lab so its followers can use Amazon's EC2 and S3 as part of their standard technology infrastructure and prototype cloud projects.

Citrix says C3 Lab is the first of several ways it plans to leverage Amazon Web Services (AWS).

Citrix dreamed up Citrix Cloud Center (C3) last year. It's a bunch of Citrix gear packaged and marketed to the cloud service provider market. This week it added XenApp and XenDesktop so service providers can deliver Windows applications and desktops as a service.

C3 Lab is supposed to provide an inexpensive, preconfigured environment that starts with access to Citrix XenApp alongside key Citrix C3 technologies such as Citrix Access Gateway and Citrix Repeater.

Users will be able to test application compatibility and staging and gain experience of the AWS cloud. Other C3 products and scenarios are supposed to be added over time.

As a help there are C3 Lab Blueprints of guidelines and best practices available for testing virtualization, security and application services in a cloud environment.

 

The C3 Lab will be made available for public use as a set of Amazon Machine Images (AMIs) in EC2.

The only charges will be Amazon's.

XenServer, a key component of C3, will soon be enhanced with a new distributed virtual switch add-on that Citrix say will enable secure, multi-tenant, highly scalable public clouds. The switch will partition network traffic on a per-application basis, with resource and security guarantees, and offer full visibility into and control over inter-VM traffic both within a server and virtual network overlay.

A technological preview should be available for a free download on June 1.

At the same time a partner program will kick in designed to give hosted service providers the "right to use" Citrix products as the underpinning of their delivery infrastructure along with flexible monthly "active subscriber" pricing and licensing.

See http://community.citrix.com/display/cdn/Citrix+C3+Lab.

Terminator Salvation game released for iPhone, iPod touch

Gameloft on Thursday announced the release of Terminator Salvation for the iPhone and iPod touch. It costs $10.

Terminator Salvation follows the storyline of the upcoming blockbuster movie starring Christian Bale. It's the latest in the long-running Terminator series, in which John Connor leads the human resistance against Skynet and an army of Terminator robots.

Previewed by Macworld in April, the Terminator Salvation iPhone game pits you against T-800 Terminators, tanks, motorcycles and drones controlled by Skynet. You get an assault rifle, shotgun, grenade launcher, chaingun and other weapons to take down the enemy robots.

Terminator Salvation requires iPhone 2.2.1 software update.

Not-for-Sale Twitter Is Expanding Search Functionality

In recent days the spotlight has been on Twitter and rumored acquisitions of the micro-blogging company by contenders such as Apple, Google and Microsoft. Twitter's founders, however, have pulled the plug on the speculation, saying the San Francisco-based company is not for sale.

"No. We are not for sale," Biz Stone, Twitter's cofounder, told ABC's The View host Barbara Walters after she asked about the acquisition rumors.

While Stone and cofounder Evan Williams put the acquisition rumors to rest, Twitter Vice President Santosh Jayaram discussed Twitter Search and its future.

Twitter Search will be used to crawl information from links by Twitters to analyze and then index the content for future use, Jayaram, a former vice president for search quality at Google, told Webware. Currently Twitter Search is only used to search words included in tweets, but not words in links.

Along with its new crawling functionality, Twitter Search will also get a ranking system. When users do a search on trending topics -- the top-10 topics people tweet about, which get their own link on the Twitter sidebar -- Twitter will analyze the reputation of the tweet writer and rank search results partially based on that.

Changes Expected

Updates to Twitter's search functionality were expected, since Twitter has access to a lot of data and needs to find a way to get revenue. Twitter's founders also hinted about such functionality when they first announced Twitter Search.

"Twitter teaches us new and amazing things every day, and a big lesson learned is that search is so much more than a box and a button," according to an official Twitter blog post. "As public tweets fly in from around the globe, we analyze them to detect when certain words or phrases occur with higher frequency."

The company added that the trending phrases surfaced on the Twitter home page as its updated throughout the day, and are a compelling if rudimentary way to explore a collective global consciousness.

Attractive for Buyers

With all the links to Web sites of interest to Twitters, the company and its search capabilities are attractive to potential buyers because it can help users find information about what is happing in real time.

There have been several examples of the effectiveness of Twitter already. When a US Airways flight made an emergency landing in New York's Hudson River, the first photo to hit the Internet was through Twitter because a passenger on a nearby ferry took a photo of the aircraft in the water.

Another example was the terror attacks in Mumbai. People caught up in the attacks used Twitter to alert friends and family that they were safe.

Jayaram also personally benefited from Twitter real-time search while at Twitter's San Francisco office on March 30. He said Twitter engineers noticed an earthquake trending upward and seconds later the building began shaking, he told Webware. An earthquake struck 60 miles outside San Francisco and tweets about the earth rumbling hit Twitter's office before the quake did.

SugarCRM Chief Steps Down

The CEO of open-source customer-relationship-management software vendor SugarCRM has stepped down.

John Roberts, who cofounded the company in 2004 with Clint Oram and Jacob Taylor, will be replaced on an interim basis by Larry Augustin, a board member and former CEO of Linux systems vendor VA Linux. The company did not give a reason for Roberts' departure, except to say that he was pursuing other opportunities.

SugarCRM makes software that sales and service departments can use to keep track of current and prospective customers. The company boasts more than 5,000 customers, who can either host the SugarCRM software themselves or buy it as a service from one of the company's partners. SugarCRM competes with industry giants Microsoft and Salesforce.com.

In a blog post, Augustin said he had taken over as interim CEO, effective Wednesday, while the company searches for a permanent chief executive.

"I have an immense amount of respect for the founding CEO, John Roberts," Augustin wrote. " Few people have taken a company from concept to major growth the way John did at Sugar."

Star Trek game beams onto iPhone, iPod touch

Electronic Arts (EA) on Thursday announced the release of the Star Trek game for the iPhone and iPod touch. It's available from the App Store for $5.

Just in time for the premier of the new motion picture that "reboots" the legendary science fiction franchise with a new cast reprising the roles of "Classic" Trek characters Kirk, Spock, Scotty, Sulu, Uhura and Chekov, the Star Trek iPhone game lets you pilot the U.S.S. Enterprise on a mission to seek out and … destroy your enemies.

Spock and Kirk make appearances as you journey through space and time, battling ships from alien races including the Klingons, the Romulans and the Cardassians. You will battle Khotak elite fighters, the Bird of Prey and Vor'cha Battle Cruiser, listen to music from the original Star Trek soundtrack, and more.

Star Trek: The Mobile Game requires iPhone 2.2.1 software update or later.

Google CEO doesn't see problem with his Apple role

Google Chief Executive Eric Schmidt is taking a government inquiry into his role on Apple Inc.'s board in stride, expressing confidence that the probe won't find any evidence that the ties between the two companies throttle competition in mobile phones and other technology fields.

In a media session held Thursday before Google's shareholders meeting in Mountain View, Schmidt said he hasn't considered stepping down from Apple's board because he doesn't view the maker of the iPhone, iPod and computers as a "primary competitor." He echoed that sentiment when a shareholder later asked him to step down from Apple's board to avoid further government scrutiny.

Google attorney Kent Walker confirmed the Mountain View-based company is in talks with the Federal Trade Commission about whether its overlapping board relationships with Apple violates federal antitrust laws. The inquiry was reported by The New York Times earlier this week.

Both Schmidt and former Genentech CEO Arthur Levinson are directors at Google and Apple.

Walker told reporters that Google is "comfortable" that it doesn't generate enough revenue in the same markets as Apple for Schmidt's and Levinson's dual roles on the companies' boards to violate antitrust law.

Google makes most of its money from online advertising driven by its market-leading search engine. But it is the chief architect of an operating system called "Android" that already runs some mobile devices similar to the iPhone. Android also is going to be in some low-cost computers, called "netbooks," later this year.

Schmidt, who joined Apple's board in 2006, told reporters he always recuses himself from all Apple board discussions involving the iPhone, but doesn't avoid talks about any other subject.

Cupertino-based Apple and Google also both make Web browsers that are vying to lure users away from Microsoft Corp.'s Internet Explorer and the Mozilla Foundation's Firefox. As its YouTube video site expands, Google also conceivably could clash with Apple's iTunes store.

The shareholder who asked Schmidt to quit Apple's board during Google's annual meeting thinks the interlocking board relationships eventually will cause headaches for Google.

"There is no reason for it because it isn't adding any value for shareholders," said Brandon Rees, a representative for the AFL-CIO's holdings in Google. "There is really nothing to gain and a lot to lose. We don't want Google to become an antitrust devil like Microsoft did."

Schmidt scoffed at a similar analogy during his session with reporters, asserting "there is no comparison" between Google's behavior and Microsoft's attempts to stifle competition in the computer software market during the 1990s. Microsoft's tactics eventually triggered an antitrust battle that forced the software maker to change its ways.

Still, the FTC inquiry is one of several signs that the government is taking a closer look at Google and its increasing dominance in Internet search and advertising. Last year Google scrapped a proposed Internet advertising partnership with Yahoo Inc. to avoid a legal battle with the U.S. Justice Department.

Before retreating, Schmidt had repeatedly predicted the Yahoo alliance would withstand antitrust scrutiny.

Now, the Justice Department is reviewing a proposed legal settlement with authors and publishers that would expand Google's digital library of books. Regulators are responding to complaints lodged by some librarians and consumer activists who are worried the proposed settlement will give Google a digital monopoly on millions of books.

A federal judge in New York recently granted a four-month extension to object to the settlement, setting a new deadline of Sept. 4.

Schmidt predicted the book settlement will lead to a "fundamentally good outcome" by giving more people around the world a better chance to buy and read out-of-print works.

He also said Google understands it's more likely to attract government scrutiny because of its dominance of Internet search and its sheer size. By some measures, Google now processes more than 70 percent of U.S. searches, helping it to generate nearly $22 billion in annual revenue.

"Information is incredibly important and we should expect governments around the world to be interested in what we do and hold us to the principles we have articulate," Schmidt said, referring to Google's corporate motto to "do no evil."

The Google shareholder meeting was a mostly amiable affair, just like the previous four that the company has held since its August 2004 initial public offering. This year marked the first time that neither of Google's co-founders, Larry Page and Sergey Brin, appeared on stage with Schmidt to take questions. Brin also missed the 2007 meeting because he was getting married then, but Page was on hand.

Spammers flood Internet with trick flu emails

Cyber crooks are capitalizing on influenza fears with torrents of email promising "Swine flu" news but delivering malware or dubious offers for potency drugs or penis enlargement.

"Zombie" computers infected with a dreaded Conficker virus that became an online scourge this year are among machines being used to spew flu spam crafted to trick email recipients, according to computer security firm Trend Micro.

"The thing making it worse is the misinformation out there about swine flu," Trend Micro threats research manager Jamz Yaneza said Thursday.

Google puts flu tracker to work on swine flu

Using a new tracking tool, search engine giant Google said on Wednesday it saw a spike in searches for information about flu among people in Mexico last week even before news of the outbreak became widely known.

Google said it has put together a flu trends tracking system for Mexico based on the U.S. Google Flu tool launched last fall that is used by U.S. Centers for Disease Control and Prevention to figure out where influenza is heating up.

It is based on Google's observation that people who are sick with flu tend to search for the same types of information on the Internet, and these searches can be used to predict where an outbreak may be occurring.

"We have seen evidence in Mexico that Google users also search flu-related topics when they are experiencing flu-related symptoms," Jeremy Ginsberg, lead engineer for Flu Trends at Google, said in a telephone briefing.

Studies show that between 35 and 40 percent of all visits to the Internet are started by people looking for health information.

Ginsberg said the Mexican data have not been cross-checked with years of data on actual flu cases in Mexico like the U.S. flu tracker has, so the data may not be reliable.

But he said the company is optimistic that the system, which generates maps based on peaks in flu-related searches, "may reflect actual flu activity."

"We did see a small increase in many parts of Mexico before major news coverage began last week," he said.

Ginsberg said people search for different things when they are sick -- like the word thermometer -- than they do when they are looking for news about flu outbreaks.

Ginsberg said the group has also seen a spike in U.S.-related flu searches that correspond with increases in U.S. cases being reported.

He said the hope is that the tool might offer one more way to predict hot spots in an outbreak as they happen.

"If it spreads quickly, it may give public health officials the chance to respond quickly," he said.

Google's flu tool for Mexico can be found at http://www.google.org/flutrends/intl/en_mx/

Benioff Calls for 'the End of Maintenance'

CEO Marc Benioff is well-known for brash pronouncements and on Tuesday delivered his latest, calling for "the end" of traditional software maintenance fees.

In an internal e-mail to his management team Tuesday, Benioff described a conversation he had with an Oracle Siebel CRM (customer relationship management) user at a recent event.

"This customer currently uses Siebel software to run her call center. She pays more than $15 million a year for the privilege of having to implement the updates that Siebel sends her," he wrote in the e-mail, which was seen by IDG News Service. "That does not include backup. Or disaster recovery. And of course, it does not guarantee that she will be using the latest technology. The maintenance agreement only assures her that her outdated software will continue to work."

The unnamed Siebel customer, Benioff said, "is paying tolls on a road to nowhere."

Salesforce.com's on-demand CRM model can provide that customer and others "much more for a fraction of what they currently pay in maintenance," Benioff added.

While at heart, Benioff's remarks aren't radically different from Salesforce.com's long-time marketing mantra, "the end of software," the e-mail comes at a time when enterprises around the world are looking to pare back wherever possible on IT spending, with reducing maintenance costs a top priority.

Meanwhile, rival vendor Oracle and its customers are currently in the throes of end-of-fiscal year contract renewals. And SAP, which announced a richer-featured but more expensive maintenance service last year to outcry from many customers, has been working with user groups on a set of KPIs (key performance indicators) meant to document the new service's value.

In his e-mail, Benioff characterized traditional maintenance, paid as a percentage of total license costs, as far inferior to SaaS (software as a service) like Salesforce.com.

"Maintenance fees cover updates that are mostly patches and fixes, but they stop far short of the kind of innovation every that enterprise needs to survive," he wrote. "We sell our customers a service and every customer is able to use the latest. Innovations are included. Upgrades are automatic and invisible. ... The service gets better, not just less buggy."

Benioff's remarks may not contain many new talking points but they do signal Salesforce.com's intentions to attack on-premise vendors' enterprise installed bases, according to 451 Group analyst China Martens.

"How do they grow to the next billion [in revenue], that's what everyone keeps asking. I don't know if he thinks this kind of grandstanding is one way to do it," Martens said.

And Benioff's critiques should be taken in the proper context, said Forrester Research analyst Ray Wang.

First of all, Salesforce.com's prices take the cost of customer support into account, he said. Second, while in some cases, SaaS may be cheaper for customers than on-premise software, it may not be in all, according to Wang. "It depends on how much you use it, how many people are using it."

SaaS is "really a lifestyle decision" for companies that don't want to deal with the hassle of maintaining infrastructure, he added.

Also, while SaaS vendors have been able to deliver on the promise of easier upgrades and faster innovation, there's no guarantee that this will be the case uniformly or forever, according to Wang. "We could be in the same boat one day, where SaaS vendors' margins are squeezed, and instead of doing four releases a year, they do one."

Overall, however, companies like Salesforce.com ought to offer compelling savings over on-premise software because of their built-in cost advantage, said Frank Scavo, managing partner of the Irvine, California, consulting firm Strativa, via e-mail.

"A large part of the so-called investment that traditional on-premise software vendors, such as SAP and Oracle, make in product development does not go toward new products or new functionality," he said. "Rather, it goes into porting and regression testing every product change against myriad combinations of databases, versions, server and desktop OS releases, middleware, and third-party products."

SaaS vendors can avoid many of these costs because they only need to write to their own platforms, and "therefore, they ought to be able to deliver the same functionality for lower cost," he said.

Sun Micro loss deepens prior to acquisition

Computer server maker Sun Microsystems Inc reported a wider quarterly loss as sales fell because of lower technology spending and uncertainty over the company's future.

Analysts said Sun's business was hurt in the last few weeks of the quarter by news that it was in talks to be acquired by IBM (IBM.N), prompting some customers to hold off on making purchases until they knew the outcome.

Oracle Corp (ORCL.O) later swooped in and agreed to buy Sun for more than $7 billion, a deal that was announced April 2.

Revenue fell 20 percent to $2.61 billion in Sun's fiscal third quarter ended March 29, compared with the average analyst forecast of $2.85 billion, according to Reuters Estimates.

Businesses were hesitant to buy Sun's computers out of concern that it might not be around to service that equipment if the unprofitable company failed to sell itself, analysts said.

"There was probably some pressure from the IBM saga that impacted the top line," said Cross Research analyst Shannon Cross. "It would have made it hard to close the quarter."

Excluding restructuring charges and related impairment of long-lived assets, Sun lost 21 cents per share in the quarter, compared with the loss of 19 cents a share expected by analysts, according to Reuters Estimates.

Computer sales dropped 29 percent to $1 billion, while storage equipment sales fell 20 percent to $425 million. Software sales rose 27 percent to $187 million, while services revenue fell 13 percent to $1.1 billion.

Gross margin shrank 2.2 percentage points from a year earlier to 42.7 percent.

Sun reported a net loss of $201 million, or 27 cents per share, versus a year-earlier loss of $34 million, or 4 cents.

The shares of the Santa Clara, California-based company were quoted at $9.14 in extended trade, down slightly from their Nasdaq close of $9.16.

Shares of Redwood City, California-based Oracle were quoted at $19.66 in extended trade, down from their Nasdaq close of $19.74.

Oracle spokeswoman Deborah Hellinger declined comment on Sun's results. The company is not holding a conference call with analysts.

Company pulls plug on `Fallujah' war video game

The publisher behind a video game based on one of the Iraq war's fiercest battles has pulled the plug on the title, called "Six Days in Fallujah."

A spokeswoman for Japanese game company Konami Corp. confirmed Tuesday the company is no longer publishing the game, which was set to go on sale early next year.

The game, which was still in development, sought to re-create the November 2004 Fallujah battle from the perspective of a U.S. Marine fighting against insurgents. Fallujah had been an insurgent holdout until U.S. forces stormed it in one of the war's most intense ground battles.

"Six Days" was developed by another company, Atomic Games, with input from more than three dozen Marines. Before deciding not to publish the game, Konami had advertised it as a realistic shooting game "unlike any other," combining "authentic weaponry, missions and combat set against the gripping story of the U.S. Marines on the ground."

But the game was criticized by some veterans, victims' families and others who called it inappropriate.

Konami did not give a reason for its decision to cancel the game.

Atomic's president, Peter Tamte, said the company was surprised.

Video game publishers don't always shy from controversy, which can even boost sales, especially if the game is of high quality. The "Grand Theft Auto" series from Take-Two Interactive Software Inc., for example, has long been under fire for its violent content, but it brings in the bulk of the company's sales. It is more common in the current economy for companies to pull the plug if the game is not going to be a hit.

Konami is known for other war games such as the popular "Metal Gear Solid" series, as well as "Dance Dance Revolution," in which players dance on a mat in synch with music.

Other titles by Atomic Games include the "Close Combat" and "World at War" series. The company also develops training systems for military and intelligence organizations

Twitter users not sticking around

More than 60 percent of Twitter users have stopped using the micro-blogging service a month after joining, according to Nielsen Online research released on Tuesday.

"Twitter has enjoyed a nice ride over the last few months, but it will not be able to sustain its meteoric rise without establishing a higher level of user loyalty," said David Martin, Nielsen Online's vice president for primary research.

Martin, in a post on the company blog, said that more than 60 percent of Twitter users fail to return the following month.

"Or in other words, Twitter's audience retention rate, or the percentage of a given month's users who come back the following month, is currently about 40 percent," he said.

"Let there be no doubt: Twitter has grown exponentially in the past few months with no small thanks to celebrity exposure," he said in a reference to new users such as US talk show host Oprah Winfrey and promoters such as actor Ashton Kutcher.

"People are signing up in droves, and Twitter's unique audience is up over 100 percent in March," Martin said.

"But despite the hockey-stick growth chart, Twitter faces an uphill battle in making sure these flocks of new users are enticed to return to the nest," he said.

"A retention rate of 40 percent will limit a site's growth to about a 10 percent reach figure," he said in a reference to the number of potential users.

Martin said that when Facebook and MySpace were emerging networks like Twitter their retention rates were twice as high and they now have retention rates of nearly 70 percent.

Martin did say that Twitter's current 40 percent retention rate was better than the 30 percent it enjoyed pre-Oprah.

Companies mine Web clues for signs of pandemics

Weeks before the Centers for Disease Control and Prevention and the World Health Organization alerted the public to a growing number of swine flu cases, a startup based in Seattle's suburbs already had a hunch something was up.

Veratect Inc., a 2-year-old company with fewer than 50 employees, combines computer algorithms with human analysts to monitor online and off-line sources for hints of disease outbreaks and civil unrest worldwide. It tracks thousands of "events" each month — an odd case of respiratory illness, or a run on over-the-counter medicines, for example — then ranks them for severity and posts them on a subscription-only Web portal for clients who want early warnings.

Internet abuzz with swine flu chatter

Swine flu chatter has been criss-crossing the Internet as the global spread of the virus became the hottest subject at micro-blogging service Twitter.

By Tuesday afternoon, Google's trend-tracking website rated swine flu a "spicy" Internet search topic due to a sudden spike in interest that earned it a spot in a Top 10 online Hot Trends list.

Meanwhile, a Google Flu website designed to use search query data to map the spread of influenza virus in the United States indicated the respiratory illness did not appear to be spreading rampantly there.

"Current estimates of flu activity are still generally low across the United States, as is expected given the confirmed swine flu case count," Google.org said in a message atop its Flu Trends home page.

Google's Flu Trends map indicated that influenza activity was "low" in all US states except Hawaii, where activity was rated as "high."

"Hawaii is a challenging model, but we aren't terribly surprised that it's marked 'high' on Flu Trends," Google.org said in response to an AFP inquiry.

"The state government says they tend to see flu year-round because of the tropical climate and tourist populations."

Swine flu chatter was rife on Twitter, as people shared news stories, headlines, fears, perceptions and misperceptions.

"Overheard in a bar: Swine flu is the new Susan Boyle. Still chuckling but I'm not sure why," tweeted a Twitter user by the online name CBCType."

Scottish singer Susan Boyle, who became a sensation after appearing on a television program "Britain's Got Talent," was the hottest topic on Twitter before being bumped from the throne by swine flu.

The US Centers for Disease Control is using Twitter to send real-time alerts and updates regarding swine flu. CDC Emergency had 37,431 followers on Twitter as of early evening.

The United States cautioned it may soon see its first deaths from the virus, which thus far has proved fatal only in Mexico, where more than 150 people are believed to have died from the flu.

"Yikes!" wrote Twitter user xenon21. "They are expecting people to die of swine flu in America."

Security Guidance for Critical Areas of Focus in Cloud Computing

The Cloud Security Alliance has released it's inaugural whitepaper called "Security Guidance for Critical Areas of Focus in Cloud Computing". The whitepaper is being presented today at RSA, outlines key issues and provides advice for both Cloud Computing customers and providers within 15 strategic domains.  It is now available on the Cloud Security Alliance website at www.cloudsecurityalliance.org/guidance.

Qualcomm to pay Broadcom $891 million to settle litigation

Wireless chip supplier Qualcomm Inc agreed to pay smaller rival Broadcom Corp $891 million over four years to settle long-standing and increasingly bitter legal battles over technology patents.

Qualcomm, which has lost several key battles in patent infringement cases with Irvine, California based Broadcom in the last few years, said on Sunday it would make its first payment of $200 million to Broadcom in the current quarter.

On Thursday, Qualcomm had rescheduled its quarterly earnings call at the last minute saying it was in advanced settlement talks with Broadcom, with which it had been fighting since 2005 in a battle spanning three continents.

Charter Equity Research analyst Ed Snyder said it made sense for Qualcomm to end the legal uncertainty even though this was a big payout for Qualcomm, which analysts expect to report quarterly revenue of $2.35 billion on April 27.

"It's clearly costing Qualcomm a lot but it's best for both companies to move on." said Snyder. "It's a win for Broadcom."

The settlement will result in the dismissal of all litigation between the companies, including patent infringement claims Broadcom brought against Qualcomm at the International Trade Commission and a court in Santa Ana, California.

The companies also agreed not to assert patents against each other for their respective chip products and certain other products and services. And Broadcom said it will withdraw its complaints against Qualcomm to the European Commission and the Korea Fair Trade Commission as part of the deal.

The settlement does not necessarily mean that the Korean and European regulators drop their investigations. But Qualcomm general counsel Donald Rosenberg told Reuters in a interview he hoped they would look favorably on the Broadcom deal and on Qualcomm's settlement last year with leading cellphone maker Nokia after their drawn out legal fight.

Telstra launches T-Suite without Salesforce

Aimed at small to medium sized businesses low on cash reserves, T-Suite will offer a range of software-as-a-service (SAAS) products, such as email, customer relationship management, collaboration, financial applications and security products, as well as online storage, for a subscription fee starting from $4 a month.

Telstra has been trialling T-Suite since late last year with select customers but is now ready with the full launch which will see the telco offer nine online applications including Microsoft's Exchange Mail and Sharepoint programs, security products from MessageLabs and McAfee and Workforce Guardian , an industrial relations tool to help manage human resources.

Although SaaS-style software has been around for a while in Australia from outlets such as Salesforce.com, SAP and local operators such as PK Business Advantage, it has yet achieved mass penetration.

But as the global financial crisis continues to wreak havoc on financial markets, the tide for SaaS has started to turn as businesses look to cut capital costs in favour of relying more on outsourced computer and telecommunications services.

Leading the charge in SaaS popularity has been Salesforce.com which was surprisingly absent from Telstra's raft of T-Suite launch partners.

Although Telstra has been in discussions with Salesforce since October last year, but no deal has yet emerged from the talks.

A Telstra spokesperson said there was no plan to include Salesforce products into T-Suite but that discussions were continuing with the company.

Telstra Business group managing director Deena Shiff also said Telstra was in discussions with more than 50 local and multinational software developers who could offer their technology through T-Suite.

Ms Shiff said Telstra was positioning T-Suite as an affordable service for businesses eager to avoid laying down big investments for new hardware and upfront software licensing fees.

"It's something that can help you stay in front without burning your balance sheet ," Ms Shiff said.

"In the current economic climate, those small businesses are looking for ways to improve cash flow and better manage risks and compliance obligations and we believe the T-Suite service provides a cost effective answer at the right time.

"We didn't foresee the global economic crisis and now is a difficult time for all business owners specifically and especially small business. It's become terribly relevant to use tools with no or very low up front costs."

Telstra said it would be engaging in a revenue sharing model with its T-Suite partners

Traders Atwitter Over New Apps

QUITE A FEW BROKERAGE FIRMS ARE PUSHING THEIR OWN social-media applications in an effort to get new customers -- and to keep current customers engaged.

TradeKing (www.tradeking.com) and Zecco (www.zecco.com) have integrated electronic conversations between customers into their trading platforms, and Charles Schwab now allows its high-asset clients to talk among themselves. But several firms now offer customer service -- and customer-to-customer communication -- via San Francisco-based Twitter (www.twitter.com), the ubiquitous service that lets anyone broadcast messages ("tweets") of up to 140 characters over the Web and via registered cellphones.

Twitter co-founder Biz Stone, appearing on Comedy Central's The Colbert Report this month, said that the service started as a side project. "It's the messaging service we didn't know we needed -- until we had it," Stone told host Stephen Colbert. The outside world first got to Twitter in 2007. Twitter is free now, but won't be forever.

AS IT TURNS OUT, FREQUENT TRADERS are engaging more and more with one another by using Twitter in various ways. The benefits of Twittering run from gossip-sharing and info-sharing among customers to on-the-spot guidance from the brokers' customer-support Twitterers. The service can provide information on bargains, too. Scottrade customers, for example, got a tweet about a 30% discount on TurboTax.

As new as the Twitter phenomenon is, there are already conventions focused on Twittering about trading. For Twitters on stocks and options, you place a dollar sign in front of the ticker symbol. You can then filter the Twitter feed to display only entries with dollar signs in them, or specific tickers you want to follow.

The newest broker on the block, tradeMonster (www.trademonster.com), decided to implement a Twitter integration rather than launch its own social-networking site just for its customers. Smart move. The customer base at tradeMonster isn't very large right now, as the site just launched last fall -- but having a presence on a very popular medium gets the name out there for others to see.

TradeMonster customers, as well as those who have signed up for a tradeMonster "paper trading" account -- a trading simulator -- can quickly tweet a stock or option they are following. The Twitter integration places a small lowercase "t" that resembles the Twitter logo in quote, chart, and position displays within the platform on your personal computer. To tweet what you are looking at right now, you just point your mouse at the "t" and click on it.

A Twitter window displays the price of the item you are looking at -- say, Goldman Sachs stock, or an option position -- or even a multi-leg position that you are considering trading. You can edit the generated tweet, or add to it, up to the 140-character limit.

It is clear that, when the chatter around a certain trade is significant, this form of communication can add significantly to price pressure.

Skip Shean, vice president of marketing and business development at tradeMonster, said the firm decided to implement a Twitter integration -- rather than build a social-networking platform that only its customers could access -- in order to generate responses quickly. "We decided to go where the audience already is, rather than trying to draw it off of there and bring it to our house," says Shean.

Especially for a new firm, I think, that is a good call.

Speed of response is particularly important to an online trader. A private network might give you interesting replies, because they will come from (by definition) members of your own network. But the replies might be slow and shallow if the community is small.

TradeMonster's Twitter integration provides its customers with a wider discussion arena, and also shows off the firm's offerings to the huge Twitter audience.

Getting started on Twitter is easy; the hard part is keeping up with the huge number of messages posted. The challenge is to filter out the junk (Is it really important to know what celebrity Ashton Kutcher is doing right now?) and find something interesting.

ONE SERVICE THAT IS AIMED RIGHT at traders is StockTwits (www.stocktwits.com), which lets you enter tickers on the "Portfolio" page, and thus filter the incessant stream of incoming posts.

There are quite a few other Twitter-filtering programs out there. My two current favorites are TweetDeck (www.tweetdeck.com, obtainable by downloading and installing a small application) and Twitterfall (www.twitterfall.com), which runs on a Web browser.

TweetDeck organizes the tweets into columns, so it is easier for you to see responses sent directly to your user name, or to filter a variety of topics and have those posts show up in separate places. If you really are interested in hearing everything Ashton Kutcher has to say, you can put his tweets in a column separate from those that pertain to your investments.

Twitterfall also has a powerful filtering engine; the tweets drop onto your screen as small illustrated boxes. You can control the flow of the posts; those that meet your criteria are queued up and displayed at an interval that you set. I have Twitterfall set up to show me messages aimed at customer-support representatives of various online brokers. Scottrade, tradeMonster, Fidelity and several others have customer-support reps who are Twittering away all day.

While interviewing Biz Stone, Stephen Colbert uttered and Twittered this investing tip: "Note to self: Send robot to past to invent Twitter before this guy."

Great idea, but tough to put into action. By the way, my Twitter address is twitter.com/twcarey.

EBay works to improve its focus on key areas

EBay Inc. said Thursday that it is focusing its efforts on business areas "where we can win," which include the company's core electronic commerce market but not the Internet telephony business the company paid a large sum to enter less than four years ago.

In a conference call with analysts, eBay also cautioned that it will face plenty of strong competition in the e-commerce market, where the company competes with dozens of smaller players as well as sector giant Amazon.com , which has been able to gain market share against eBay of late.

"We will continue to be one of the winners in a changing e-commerce landscape. It is not a winner-take-all," CEO John Donahoe said on the call, adding that the industry "will have multiple winners, each focused on target segments."

The call on Thursday morning came after the company announced plans to make a tender offer to buy a majority stake in Gmarket  , a Korean company that operates a large, fixed-price e-commerce site in that country. The purchase price could reach $1.2 billion if all the company's outstanding shares are tendered; eBay says it has already reached agreement with holders of 67% of the shares. 

Donahoe said the Gmarket purchase will strengthen the companies' presence in Korea and Asia. This, in turn, will help broaden the market for the company's PayPal business -- on which eBay is banking heavily for future growth.

"This business has tremendous potential, and we expect PayPal to approximately double over the next three years," Donahoe said.

EBay shares were trading up 0.4% to $14.38 by early Thursday afternoon.

Analysts liked the deal, overall. Colin Sebastian of Lazard Capital Markets called the move "a positive step" for eBay in establishing itself in the South Korean market and could be a stepping stone in the broader region.

"Historically, eBay had limited success in gaining a foothold in Asia, where local players tend to dominate online shopping," Sebastian wrote in a note to clients.

Justin Post of Bank of America said the deal will give eBay nearly 40% of the e-commerce market in South Korea. But he added that the deal looked expensive, with eBay paying about four times Gmarket's 2010 revenue estimate compared to its own current valuation of about two-times projected revenues.

"Despite synergies, it's possible deep value shareholders may have preferred cash repatriation and buybacks," Post wrote in his report.

Shedding Skype

The move to buy Gmarket came just a day after the company announced plans to eventually shed itself of Skype, the Internet telephony provider eBay acquired in 2005 for $2.6 billion.

EBay has struggled to fit Skype into its overall business. The unit brought in revenue of $551 million last year -- about 6% of eBay's total revenue base. Analysts have worried that running Skype distracts eBay from focusing on its core business, which has suffered over the past couple of years from slowing growth and heavier competition.

Late Tuesday, eBay announced that it plans to commence an initial public offering for sometime over the next 14 months or so, depending on market conditions. On the call Thursday, Donahoe left the door open to considering another type of deal, but maintained that the company eventually plans to completely separate Skype from the rest of the business.

"If we were to receive an unsolicited offer, naturally we would evaluate against what we believe can be achieved through a public offering," Donahoe said. "And we believe that an IPO during the first half of 2010 is very feasible, contingent upon market conditions."

Heath Terry of Friedman Billings Ramsey said a Skype IPO could fetch a valuation between $1.5 billion and $2.5 billion. In a report, he added that separating Skype "should allow management to resume returning capital to shareholders and focus on stabilizing the Marketplaces business."

In a much smaller deal, eBay also recently sold back StumbleUpon, a Web-based tool for locating media content, back to its original founders. Financial terms of that deal were not disclosed.