may the force be with you

The owners of the privately held social-networking site hope to fetch as much as $2 billion. And media giants like Viacom may make a good match

Facebook, the Web site where students around the world socialize and swap information, has put itself on the block, BusinessWeek Online has learned. The owners of the privately held company have turned down a $750 million offer and hope to fetch as much as $2 billion in a sale, senior industry executives familiar with the matter say.

That may sound like a huge amount of money, especially when you consider that the company was launched just two years ago by a group of sophomores at Harvard University, led by Mark Zuckerberg (see BW Online, "Under 30, On the Cutting Edge"). But already, www.facebook.com has become the seventh-most heavily trafficked site on the Internet, according to market researcher comScore Media Metrix. It racked up 5.5 billion page views during the month of February, the latest month for which complete data are available. That's more page views than the Web sites of Amazon.com (AMZN), Ask.com, or Walt Disney (DIS).

GOOD FIT. It's not clear who would be willing or able to pay that much. Industry analysts think that Facebook might be a good match for Viacom (VIA), which owns the MTV, VH1, and Comedy Central cable networks. "I think Facebook would be a great strategic fit for Viacom," says Troy Young, executive vice-president and chief experience architect at Organic, an online advertising and consulting firm. "Viacom has people working on social networking. But I think they need to demonstrate to the market, through a major acquisition, that they are on top of the youth marketplace," Young said. Viacom declined comment. Facebook executives weren't immediately available for comment.

A Facebook deal would help Viacom founder and Executive Chairman Sumner Redstone fend off a growing challenge from News Corp. (NWS). The media conglomerate run by Rupert Murdoch has poured enormous resources into the Internet during the last year. It acquired social-networking pioneer MySpace.com last year for $580 million (see BW Online, 11/15/05, "Users Crowd into MySpace").

MySpace has continued to grow since the acquisition. It had 37.3 million unique visitors during the month of February, according to comScore. It logged 23.5 billion page views, making it the second-most trafficked site after Yahoo, which had 30 billion. MSN (MSFT) was No. 3, with 18 billion, and Google (GOOG) was No. 6, with 7.7 billion. News Corp. also acquired gaming and men's lifestyle site ign.com for $650 million (see BW Online, 08/22/05, "IGN Entertainment: Where the Boys Are").

ATTRACTIVE TO MARKETERS. Sites like MySpace and Facebook, and social-networking rivals such as the video-oriented YouTube are promising new channels for communication, entertainment, and marketing. Social-networking sites are a primary form of communication for millions of younger people in the U.S, and increasingly, around the world. It's not unusual for young people to spend an hour or more a day at such sites, posting photos, messages, and blog entries, and building up huge lists of online "friends." While advertising rates on such sites are low, marketers of music and consumer goods have flocked to MySpace and its rivals.

Facebook doesn't match the scale of MySpace, but Organic's Young says it presents a great opportunity for marketers. The site admits college and high school students, though it's more popular on a college level, and the atmosphere is more controlled than the free-wheeling MySpace.

In recent months, parents, politicians, and police have become concerned that criminals could be taking advantage of MySpace (see BW Online, 03/06/06, "Making MySpace Safe for Kids"). On Mar. 21, Connecticut Attorney General Richard Blumenthal called on the company to take steps to protect minors from potential harm. MySpace says that it shares the concerns about safety and security on the site and is working with the attorney general to bolster its safety practices and procedures.

WAY BEYOND CAMBRIDGE. Zuckerberg founded his company, originally known as The Facebook, as a way for classmates at Harvard to communicate. It was named after the books that colleges typically provide students, listing profiles and pictures of classmates. He asked friend Eduardo Saverin to help fund the site. Classmates Chris Hughes and Dustin Moskovitz joined as co-founders. The site was an instant hit at Harvard, and it quickly took hold at other schools, such as Stanford University. Since then, it has spread across the U.S. and other parts of the world.

Just a few months ago, people scoffed at the hundreds of millions that Murdoch spent on News Corp.'s Net acquisitions. But those prices are likely to be surpassed in the near future, as M&A activity in the social-networking sector heats up.

source:http://www.businessweek.com/technology/content/mar2006/tc20060327_215976.htm

The U.S. Patent and Trademark Office has published three wireless-related patents filed by Google employees as the search giant seeks to delve deeper into the wireless market.

The patent applications, filed by Google employees Wesley Chan, Shioupyn Shen and former Google product management director Georges Harik, propose lowering the cost of wireless access by offsetting the costs via advertisements on the service. Google, which receives the bulk of its revenue from advertisers, is seeking to expand its potential advertising base by moving further into the wireless market.

The patent applications, filed in 2004 and published earlier this month, address three issues related to the wireless and advertising market.

Patent application No. 20060058019 seeks to develop a system for dynamically modifying the appearance of browser screens on a client device when connecting to a wireless access point. Under the patent, the browser's appearance would be modified to reflect the brand associated with the wireless access-point provider.

The patent application says that WiFi Internet access would be provided freely to customers in exchange for their agreement to receiving ads on their devices.

Google, however, noted its patent applications do not represent a guarantee it will head in a particular direction with its technology.

"Like many companies, we file patent applications on a variety of ideas that our employees may come up with. Some of those ideas later mature into real products or services; some don't," a company representative said. "Prospective product announcements should not be inferred from our patent applications."

The two other patent applications, No. 20060059044 and No. 20060059043, cover ads based on wireless access points and wireless access at a reduced rate, respectively.

"The gap between what Wi-Fi operators charge and what casual mobile users are typically willing to pay is relatively significant," according to the patent applications. "Therefore, WiFi Internet access as an industry has experienced a rather slow start."

source:http://www.zdnetasia.com/news/communications/0,39044192,39346317,00.htm

The forthcoming update to Intel's Viiv will see the media centre PC move from the living room to the home office. Asher Moses explains why.

Before anyone mentions it, no, we haven't been smoking any particularly potent herbal products lately, nor were we repeatedly beaten over the head with a two by four on the way to work this morning. Hear me out.

Thus far, every play to bring the PC into the living room has revolved around plonking an entire machine down in the lounge, right next to your existing home theatre equipment. In our opinion, this method was doomed from the outset.

The only moderate success of Windows Media Center-equipped PCs has highlighted the fact that most consumers aren't interested in having an all-singing, all-dancing computer in their lounge room. We're not interested in editing word documents, manipulating spreadsheets, browsing the Web or playing games in a three metre interface from the couch (as opposed to sitting directly in front of the screen like we normally do when interacting with a PC). Rather, we'd simply like to watch/record TV, view DVDs and play other audio/video files on-demand through a simple, intuitive interface.

This is where the genius of Viiv comes in. Shortly, Intel will release a range of "digital media adapters", which connect to your existing home theatre components (e.g. your TV, stereo system, etc) and can stream content wirelessly from any Viiv-certified PC. Bingo!

The existence of digital media adapters will totally remove the need to have a media centre PC taking up space in your living room, unless you're one of the few users that finds it practical to do anything other than passively soak up multimedia content whilst relaxing on the couch.

As a result, the PC in your home office will likely act as a digital media hub, distributing content wirelessly throughout your house to various media adapters. And since the Windows Media Center Edition operating system used by all Viiv-enabled machines is virtually identical to Windows XP when it's not in media centre mode, you can go about your regular office-related tasks -- word processing, web browsing, etc -- while others are seamlessly streaming content in the lounge.

Such multi-tasking makes dual-core processors a necessity, which explains why Intel requires all vendors of Viiv machines to adopt a dual-core processor before gaining certification.

Suddenly, the logic surrounding some manufacturers' decisions to offer Viiv machines in an office-like tower form factor -- for example, the Acer Aspire e650 -- is beginning to make sense.

What do you think? Will the PC pull out of the lounge room, leaving your home office machine to act as both a media hub and a productivity workhorse? Have your say below!

source:http://www.cnet.com.au/desktops/pcs/0,39029439,40061467,00.htm

Back in 1998, the federal government declared that its landmark antitrust suit against the Microsoft Corporation was not merely a matter of law enforcement, but a defense of innovation. The concern was that the company was wielding its market power and its strategy of bundling more and more features into its dominant Windows desktop operating system to thwart competition and stifle innovation.

Eight years later, long after Microsoft lost and then settled the antitrust case, it turns out that Windows is indeed stifling innovation — at Microsoft.

The company's marathon effort to come up with the a new version of its desktop operating system, called Windows Vista, has repeatedly stalled. Last week, in the latest setback, Microsoft conceded that Vista would not be ready for consumers until January, missing the holiday sales season, to the chagrin of personal computer makers and electronics retailers — and those computer users eager to move up from Windows XP, a five-year-old product.

In those five years, Apple Computer has turned out four new versions of its Macintosh operating system, beating Microsoft to market with features that will be in Vista, like desktop search, advanced 3-D graphics and "widgets," an array of small, single-purpose programs like news tickers, traffic reports and weather maps.

So what's wrong with Microsoft? There is, after all, no shortage of smart software engineers working at the corporate campus in Redmond, Wash. The problem, it seems, is largely that Microsoft's past success and its bundling strategy have become a weakness.

Windows runs on 330 million personal computers worldwide. Three hundred PC manufacturers around the world install Windows on their machines; thousands of devices like printers, scanners and music players plug into Windows computers; and tens of thousands of third-party software applications run on Windows. And a crucial reason Microsoft holds more than 90 percent of the PC operating system market is that the company strains to make sure software and hardware that ran on previous versions of Windows will also work on the new one — compatibility, in computing terms.

As a result, each new version of Windows carries the baggage of its past. As Windows has grown, the technical challenge has become increasingly daunting. Several thousand engineers have labored to build and test Windows Vista, a sprawling, complex software construction project with 50 million lines of code, or more than 40 percent larger than Windows XP.

"Windows is now so big and onerous because of the size of its code base, the size of its ecosystem and its insistence on compatibility with the legacy hardware and software, that it just slows everything down," observed David B. Yoffie, a professor at the Harvard Business School. "That's why a company like Apple has such an easier time of innovation."

Microsoft certainly understands the problem, the need to change and the potential long-term threat to its business from rivals like Apple, the free Linux operating system, and from companies like Google that distribute software as a service over the Internet.

In an internal memo last October, Ray Ozzie, chief technical officer, who joined Microsoft last year, wrote, "Complexity kills. It sucks the life out of developers, it makes products difficult to plan, build and test, it introduces security challenges and it causes end-user and administrator frustration."

Last Monday afternoon, James Allchin, the longtime engineering executive who leads the Vista team, held a meeting with 75 Windows managers and senior engineers to discuss the status of Vista. On Tuesday morning, Mr. Allchin met with a handful of his lieutenants and told them of the decision to push back the consumer introduction, a move that was announced publicly later that day, after the close of the stock market.

Brad Goldberg, a general manager of Windows program management, who attended the Tuesday morning meeting, said he was not surprised, because he had been involved in the decision. "But it's a different place than Microsoft a few years ago would have wound up," he said.

Like other Microsoft executives, Mr. Goldberg bristles at the notion that little innovative work has come out of the Windows group since XP. In the last five years, he said, Microsoft has released two versions of the Windows Tablet PC software intended for pen-based notebook computers, and four versions of Windows Media Center. To combat viruses plaguing Windows, much of the engineering team focused for 18 months on fixing security flaws for a downloadable "service pack" in 2004.

"The perception that nothing new has come out of the Windows group since XP is just so far from the truth," Mr. Goldberg said.

But last Thursday, Microsoft reorganized the management of its Windows division. Steven Sinofsky, 40, a senior vice president, was placed in charge of product planning and engineering for Windows and Windows Live, a new Web service that lets consumers manage their e-mail accounts, instant messaging, blogs, photos and podcasts in one site.

Mr. Sinofsky, a former technical assistant to Bill Gates, the Microsoft chairman, was one of the early people in the company to recognize the importance of the Internet in the 1990's. He comes to the Windows job from heading Microsoft's big Office division, where he was known for bringing out new versions of the Office suite — Word, Excel, PowerPoint, Outlook and other offerings — on schedule every two or three years.

The move is seen as an effort to bring greater discipline to the Windows group. "But this doesn't seem to do anything to address the core Windows problem; Windows is too big and too complex," said Michael A. Cusumano, a professor at the Sloan School of Management at the Massachusetts Institute of Technology.

The Vista delay, Microsoft executives said, was only a matter of a few more weeks to improve quality further, not attributable to any single flaw and done to make sure all its industry partners were ready when the product was introduced. Vista will be ready for large corporate customers in November, while the consumer rollout is being pushed back to January 2007.

Mr. Allchin conceded in an interview that the decision was "a bit painful," but he insisted it was the "right thing." Mr. Allchin, 54, will continue to work on Vista until it ships and then retire, as he said he would last year.

Microsoft will not say so, but antitrust considerations may have played a role in the decision that Mr. Allchin called the right thing to do. As part of its antitrust settlement, Microsoft vowed to treat PC makers even-handedly, after evidence in the trial that Microsoft had rewarded some PC makers with better pricing or more marketing help in exchange for giving Microsoft products an edge over competing software.

In the last few weeks, Microsoft met with major PC makers and retailers to discuss Vista. Hewlett-Packard, the second-largest PC maker after Dell, is a leader in the consumer market. Yet unlike Dell, Hewlett-Packard sells extensively through retailers, whose orders must be taken and shelves stocked. That takes time.

Hewlett-Packard, according to a person close to the company who asked not to be identified because he was told the information confidentially, informed Microsoft that unless Vista was locked down and ready by August, Hewlett-Packard would be at a disadvantage in the year-end sales season.

Vista was also held up because the project was restarted in the summer of 2004. By then, it became clear to Mr. Allchin and others inside Microsoft that the way they were trying to build the new version of Windows, then called Longhorn, would not work. Two years' worth of work was scrapped, and some planned features were dropped, like an intelligent data storage system called WinFS.

The new work, Microsoft decided, would take a new approach. Vista was built more in small modules that then fit together like Lego blocks, making development and testing easier to manage.

"They did the right thing in deciding that the Longhorn code was a tangled, hopeless mess, and starting over," said Mr. Cusumano of M.I.T. "But Vista is still an enormous, complex structure."

Skeptics like Mr. Cusumano say that fixing the Windows problem will take a more radical approach, a willingness to walk away from its legacy. One instructive example, they say, is what happened at Apple.

Remember that Steven P. Jobs came back to Apple because the company's effort to develop an ambitious new operating system, codenamed Copland, had failed. Mr. Jobs convinced Apple to buy his company Next Inc. for $400 million in December 1996 for its operating system.

It took Mr. Jobs and his team years to retool and tailor the Next operating system into what became Macintosh OS X. When it arrived in 2001, the new system essentially walked away from Apple's previous operating system, OS 9. Software applications written for OS 9 would run on an OS X machine, but only by firing up the old operating system separately.

The approach was somewhat ungainly, but it allowed Apple to move to a new technology, a more stable, elegantly designed operating system. The one sacrifice was that OS X would not be compatible with old Macintosh programs, a step Microsoft has always refused to take with Windows.

"Microsoft feels it can't get away with breaking compatibility," said Mendel Rosenblum, a Stanford University computer scientist. "All of their applications must continue to run, and from an architectural point of view that's a very painful thing."

It is also costly in terms of time, money and manpower. Where Microsoft has thousands of engineers on its Windows team, Apple has a lean development group of roughly 350 programmers and fewer than 100 software testers, according to two Apple employees who spoke on the condition that they not be identified.

And Apple had the advantage of building on software from university laboratories, an experimental version of the Unix operating system developed at Carnegie Mellon University and a free variant of Unix from the University of California, Berkeley. That helps explain why a small team at Apple has been able to build an operating system rich in features with nearly as many lines of code as Microsoft's Windows.

And Apple, which makes operating systems that run only on its own computers, does not have to work with the massive business ecosystem of Microsoft, with its hundreds of PC makers and thousands of third-party software companies.

That ballast is also Microsoft's great strength, and a reason industry partners and computer users stick with Windows, even if its size and strategy slow innovation. Unless Microsoft can pick up the pace, "consumers may simply end up with a more and more inferior operating system over time, which is sad," said Mr. Yoffie of the Harvard Business School.

source:http://www.nytimes.com/2006/03/27/technology/27soft.html?ex=1301115600&en=d0c02cd75d5822fb&ei=5088&partner=rssnyt&emc=rss

Pricey pill combo could keep at-risk populations from catching the virus

ATLANTA - Twenty-five years after the first AIDS cases jolted the world, scientists think they soon may have a pill that people could take to keep from getting the virus that causes the global killer.

Two drugs already used to treat HIV infection have shown such promise at preventing it in monkeys that officials last week said they would expand early tests in healthy high-risk men and women around the world.

"This is the first thing I've seen at this point that I think really could have a prevention impact," said Thomas Folks, a federal scientist since the earliest days of AIDS. "If it works, it could be distributed quickly and could blunt the epidemic."

Condoms and counseling alone have not been enough — HIV spreads to 10 people every minute, 5 million every year. A vaccine remains the best hope but none is in sight.

If larger tests show the drugs work, they could be given to people at highest risk of HIV — from gay men in American cities to women in Africa who catch the virus from their partners.

Promise of a parachute
People like Matthew Bell, a 32-year-old hotel manager in San Francisco who volunteered for a safety study of one of the drugs.

"As much as I want to make the right choices all of the time, that's not the reality of it," he said of practicing safe sex. "If I thought there was a fallback parachute, a preventative, I would definitely want to add that."

Some fear that this could make things worse.

"I've had people make comments to me, 'Aren't you just making the world safer for unsafe sex?'" said Dr. Lynn Paxton, team leader for the project at the Centers for Disease Control and Prevention.

The drugs would only be given to people along with counseling and condoms, and regular testing to make sure they haven't become infected. Health officials also think the strategy has potential for more people than just gay men, though they don't intend to give it "to housewives in Peoria," as Paxton puts it.

Some uninfected gay men already are getting the drugs from friends with AIDS or doctors willing to prescribe them to patients who admit not using condoms. This kind of use could lead to drug resistance and is one reason officials are rushing to expand studies.

"We need information about whether this approach is safe and effective" before recommending it, said Dr. Susan Buchbinder, who leads one study in San Francisco.

source:http://www.msnbc.msn.com/id/12039614/

The tech convergence has George Lucas’s gaming and movie divisions working hand-in-glove. R&D honcho Steve Sullivan and project lead Chris Williams explain how it’s working

There's a natural affinity between the fantasy worlds created in movies and video games. At Lucasfilm Ltd., George Lucas' privately held entertainment company, the convergence of technology and manpower is hastening that collision. The ultimate goal is to boost collaboration between Industrial Light & Magic, the vaunted effects shop and biggest Lucasfilm unit, and its smaller game division, LucasArts.

The payoff is two-fold. ILM's legendary technological prowess helps improve the next generation of video games. Exposure to LucasArts is expected to help imbue ILM with some of the game unit's faster-paced culture -- and it will yield more video-game-like tools for use in movie-making.

The core technology driving the convergence is a proprietary internal software platform called Zeno, which both ILM and LucasArts will now use. Having a common technology lays the groundwork for each division to access the other's work and -- the hope is -- will lead to increased collaboration and borrowing.

COMING TOGETHER. The convergence is also aided quite literally by Lucasfilm's new facility at the Presidio in San Francisco, which brings together units previously separated by geography and corporate culture. LucasArts moved in last July, and most of ILM was in house by October.

On Friday, Mar. 24, Steve Sullivan, ILM's head of research and development, and Project Lead Chris Williams, a LucasArts producer, spoke to the Game Developer's Conference in San Jose about the convergence between the two units. BusinessWeek Corporate Strategies editor Brian Hindo caught up with them by phone. Here are edited excerpts of their chat:

What was the impetus of this drive for more collaboration between LucasArts and ILM?
Sullivan: I think George [Lucas] has intended this for quite a long time. It was hard before because we were geographically separate. The technology wasn't far enough that ILM and LucasArts could actually trade all that much.

Computers had to get to a certain speed before it could really be meaningful to use film graphics in games. The consoles had to be powerful enough to support that kind of thing. We really had a sweet spot where the companies have co-located in the same building. And George is really strongly dedicated to this now that Star Wars is done.

What's the hope for all this collaboration?
Williams: George views LucasArts as a company that can do things very, very quickly and in real time. But we still have a lot of room to grow in terms of our visual quality and our visual target. And ILM is a company that can do things with very high visual quality. But that takes them a lot of time. So this is not just ILM helping Lucasarts make our games look better. It's really a shared benefit.

Sullivan: We're definitely not real time. We're more concerned with "can we do it," rather than "how fast can we do it." Because our pipeline is built on taking a long time to get a perfect image, it slows down that period of iterative process, where you're looking at something -- "Is this right? Now, let's change that." The game engines they're building at LucasArts and the way they're pushing their tools, they're going to provide us with techniques that are maybe approximate, but really fast -- like real time. You can converge very quickly to 95% and then send it off to the render farm (where computer generated images are rendered).

So that can save you time and money?
Sullivan: Yeah. It also changes the content of the projects, because you can iterate very quickly through ideas, brainstorm things. You might get two or three stabs at some big idea.

What else might more collaboration with LucasArts enable ILM to do?
Sullivan: Pre-visualization, which is a big thing that George has been pushing lately. It's a tool that directors would use to quickly mock up the ideas of a story and see what's going to work. It's really like building up a preview of a movie in a video game world. Instead of using static story boards, you can really just get in and create 3D content and camera moves directly. It's the best example of the kind of collaboration we've got going on. It came from George -- it didn't come from either division. But it requires things that both divisions have expertise in.

What's different about movie people vs. game people?
Williams: Fundamentally, movie people are all about shots. How they get to the shot, and the process that they go through, is new and different and there are unique challenges associated with that. But at the end of the day the final output is something that goes on film. In game development you're making a software application. It's code that needs to run on a piece of hardware. So that's a very fundamental shift in terms of what your output is.

You also just have to do a shot once, while a game has to work over and over again, in different ways.
Sullivan: Quality assurance (QA) is a fundamental part of their culture and we don't have it at ILM. They have to have QA, and it's really rigorous, because it's not just for their development process. The product going out the door is going to be judged on whether there are bugs in it.

As a result of the convergence, moving into new offices and using a new software platform, Zeno, what sorts of cultural shifts have been going on at LucasArts?
Williams: What LucasArts needed to do, from a cultural standpoint, was really embrace this notion of developing a cross-company tool with a pretty well established code base. And obviously not everything about that code base is going to be optimal for what we want to do, so there were certain concessions and compromises that we made early on. But now we're in a really good place where the tool's working really well for us. That was a challenge. The history of game development is one of small groups of engineers growing it from scratch. And this was us embracing a huge set of already established code.

This collaboration seems to imply that the traditional way video games and films are made will change.
Sullivan: An example would be, ILM is doing a shot for a film, but LucasArts artists can have that exact shot sitting on their desk, and they can start building a game environment around it or incorporating that somehow.

Is that happening already?
Williams: It's not happening right now, in that there's no project that ILM and LucasArts are both collaborating on right now. But there is full intention that we get to that place. That's certainly a key part of the vision.

We're not in a space right now where we just want to be cranking out movie games. To the extent that we did that with the Episode III game, we're kind of done with that. We want to be telling new stories, new experiences, and really taking advantage of the interactive medium. And not just rehashing or serving up a film experience in a sort of interactive way. We're not sitting here right now waiting for ILM to come to us with some big film project so we can just crank out a movie game of it. The goal is use these tools, techniques, and knowledge to make a really exciting, innovative, next-gen product.

source:http://www.businessweek.com/innovate/content/mar2006/id20060327_719255.htm