What happened to the Sony PS3

As a lot of people who follow the gaming console industry know, a couple of years ago, there was a duet between 2 of the major contenders - the Sony PS3 and Microsoft's XboX 360 (during their development, the entire discussion was about which of these would be the winner). And then there was a sudden winner, Nintendo was the surprise leader, with its Wii gaming platform selling much higher than the other platforms. Both the PS3 and the XboX are much more powerful in terms of processing speed and raw power, but the incredible user-interactivity built into the Wii made it much more attractive to people, and it started out-selling the others within a short time. And no matter what Sony and Microsoft are trying, they are not able to compete with Nintendo, even with price cuts and a lot more marketing.
The latest selling season further amplifies this trend, with the Wii pulling ahead of its competitors, way ahead:

Sony's PS3 is dying on the shelves. Alone among the three major videogame consoles, sales of the PS3 are down about 19% from November 2007, according to the latest stats from the NPD Group. Sony was only able to sell 378,000 PS3s this November, compared to 466,000 last year.
And the problem for Sony isn't the recession, it's the PS3. Microsoft (MSFT) put up respectable numbers with its Xbox 360, selling 836,000 units vs 777,000 in November 2007. And Nintendo's (NTDOY) Wii continues to dominate the market, more than doubling sales from 981,000 to 2.04 million.

Sony is stuck with its initial plan to build a powerhouse, since that (along with a Blu-Ray drive) makes the PS3 much more expensive; in addition, since the Wii is much ahead, there aren't enough developers making quality games for the PS3 - causing further problems.

Yahoo's Yang steps down as CEO

As a previous post on this blog had mentioned, the Yahoo-Google-Microsoft drama will not end so easily. The number of twists and turns this story has been taking are pretty dramatic, and forms a soap opera worthy of spinning into a hard-balled corporate story. For a matter of many months now, it has seemed clear that Yahoo does not have what it takes to challenger Google and Microsoft in the online space; the only logical path forward was to tie up with another party and then make a pitch to fight for the top. However, when Microsoft made its bids for Yahoo in order to form a much stronger team to challenge Google, it was the Yahoo Board led by Yang which played hardball, pitching for more money.
This was a traumatic situation for shareholders, since the Yahoo stock was around half the offer price, and here was this company offering a pretty good deal for shareholders. And then you have the Yahoo management refusing this deal, or finally holding out for a higher offer that never came. And then, the collapse. The Yahoo share, which was quoting close to $20 during this offer period, is now quoting around $10. Yang made promises during this period, and they have not come true, probably the reason why he is stepping down now:

Shares of Yahoo Inc soared nearly 15 percent on Tuesday on hopes that the departure of Jerry Yang, its embattled chief executive, would clear the way for a deal with Microsoft Corp. Yahoo announced late on Monday that Yang, whose leadership had come under growing criticism from shareholders after he failed to agree to a deal with Microsoft, would step down from his role as soon as the board finds a replacement.
Analysts said Yang's decision to step down is a sign that the board was frustrated with his efforts to turn around the company, which he co-founded. Yang took on the CEO role in June 2007. "Jerry's resignation as CEO reflects failed promises he made while fighting off Microsoft's offers, and the board's displeasure with his go-it-alone strategy," wrote Jefferies & Co analyst Youssef Squali in a research note.

Yahoo's board must be hoping that this new management decision may lead to re-starting of discussions with Microsoft, even though Microsoft is not likely to offer above $30 now. And given the collapsed deal with Google (due to anti-trust), Yahoo would most likely die down rather than reach a top position on its own.

Sinowal Trojan: Stealing financial information for 2 years +

In the recent past, there has been a lowering of the apparent threat level of Trojans, it almost seems like people have taken them for granted. Well, here is news that should make you reconsider, should remind you that if you are unprotected, then there are many dangers out there that could affect your financial status:

RSA FraudAction Research Lab has discovered log-in information for about 300,000 online bank accounts and 250,000 credit and debit card accounts that have been gathered by a cybercrime gang over the past three years using the Sinowal Trojan. "This may be one of the most pervasive and advanced pieces of crimeware ever created by fraudsters," according to a blog entry posted Friday from RSA, EMC's security unit. The Sinowal Trojan infects computers without the owner knowing it by surrepticiously planting itself onto the computer while the owner is Web surfing in an attack dubbed a "drive-by download."
The Trojan is programmed to execute when the victim visits a particular banking or financial Web site; it is triggered by more than 2,700 specific URLs, according to RSA. The malware then inserts additional fields into the victim's browser prompting the victim to type in information such as PIN and Social Security number, which the Web site itself does not ask for.

This was truly a dangerous Trojan. Imagine being undetected for so many years, especially when the trade of user financial information is now manipulated by criminal gangs. With greater internet usage, the transfer of money is now much quicker and money can vanish from one place to another in no time at all. Further, there are a large number of people who would fall prey to such attacks and have their financial information revealed.

A paper vanishes from the printing area - Christian Science Monitor

For many years now, it has been predicted that the online news arena will continue to have rapid growth, and giving new credence to the phrase, 'a zero sum game', this will also result in a decrease in the number of print newspapers out in the market. This has been happening to some extent, not with the shutting down of major print media publications, but with a decrease in the classifieds and advertisements. However, now there is a clear marker to the extent of this change. The Christian Science Monitor, a 100 year daily, is shutting down and will take on a internet only avatar.
They are offsetting this to some extent with the introduction of a new weekly physical edition, but it is not the same as having a thriving daily print edition. With this event, many other newspapers and media companies (especially ones that have shareholders) will be weighing the impact of this news and wondering as to when their turn will come:

Stop the press, it’s finally happened. A national American newspaper, with an illustrious 100-year publishing |history and seven Pulitzer prizes, has gone totally digital. Last week, the Boston-based The Christian Science Monitor announced its decision to shift its daily news business entirely on to the internet. In April of next year, The Christian Science Monitor, a newspaper begun in 1908, will stop printing its newspaper and will, instead, invest all its daily news resources into its enhanced, advertising supported www.CSMonitor.com website.
A hundred years later, the internet publishing platform, with its instant global reach and shrinking technology costs, has turned the news business upside down. In today’s online world of instant publishing, where news junkies are hooked on up-to-the-minute information and commentary, a daily newspaper, printed or otherwise, is quickly becoming both a cultural and economic anachronism.

This is indeed a major event, and will be heralded as a major indicator to the massive growth of the internet platform and point out the print version to be an anachronism.

Women kills husband in an online game, arrested

Online games where people live in a virtual reality using 'avatars' have become wildly popular, with millions using such games. But if people think that online worlds are a more utopian alternative to the real world, they are mistaken. There are the same kind of emotions, same kind of strange behavior, same weaknesses that exist in real life; they are making their existence felt in such online games as well. Consider the case of this lady who was married in virtual reality to a person who actually lived more than 620 miles away. One day she found herself divorced, and this unnerved her so much that she decided to kill the 'avatar' of her online husband (no implication in real life, but his online character died):

A 43-year-old Japanese woman whose sudden divorce in a virtual game world made her so angry that she killed her online husband's digital persona has been arrested on suspicion of hacking, police said Thursday. The woman, who is jailed on suspicion of illegally accessing a computer and manipulating electronic data, used his identification and password to log onto popular interactive game "Maple Story" to carry out the virtual murder in mid-May.
"I was suddenly divorced, without a word of warning. That made me so angry," the official quoted her as telling investigators and admitting the allegations.

There have been other cases like this, with people swindling virtual money (with this virtual money capable of being converted into real currency, this is a crime), people objecting when their spouses spend too much time in these games or get married in the virtual world to somebody else, and so on. As time passes by, the probability of such incidents happening would increase.

Google launches Adsense for Games

Google is always on the lookout for how to keep on increasing its ad portfolio. Getting ads into more and more platforms, into different devices, and accordingly getting a higher amount of revenue is what Google has always been interested in. Its corporate acquisition program has also been geared towards this effort, buying more and more companies that it believes can help it in its ad serving platform.
The popularity of online Flash based games has been soaring over the last few years, with usage figures soaring. For a long time, there was a feeling that Google will jump into this space, and the acquisition of Adscape Media in 2007 increased this feeling into a near certainty. The ongoing Beta by Google in this space, involving some of the Game developers since earlier this year made the intention clear:

More than a year in the works, Google finally launched its in-game advertising platform Wednesday. Called AdSense for Games, the platform will offer advertisers access to millions of Web-based Flash games. The in-game advertising market is small. The games industry scored only $1 billion from advertising and subscriptions in 2007, according to research firm Parks Associates. Google's entry is expected to make it explode.
Google's new ad platform, which grew out of its 2007 acquisition of Adscape Media, has operated in beta since early 2008. Game developers like Konami, Playfish and Zynga participated in the beta, but now other developers and publishers will also be able to apply to the program. The most prevalent ads throughout the company's beta test were short video spots from Esurance, but the network will also provide contextual and text ads.

Some of the success stories from developers using Adsense for Games has made the likely success of Adsense for Games more of a certainty, and is likely to increase the space between Google and its competitors in the Ad space.

Another iPhone attacker: BlackBerry Storm from RIM

Ever since Apple came out with the iPhone, and made it a tremendously hot selling gadget, most of the other providers of smartphones have been jealous of the success of the iPhone, and have been casting around for a successful product that could appeal to people. At the same time, it has been difficult going for them, there have been a number of phones that have been launched that have been advertised unofficially as iPhone-killers, but none of them have managed to stand upto the marketing might of the iPhone.
Here comes another of these devices. At some point, RIM realized that its safe world of selling gadgets to office workers was under threat; the iPhone has started acquiring acceptance among office IT administrators over the world; this is threatening the sale of devices of RIM:

Research In Motion is taking on Apple's iPhone 3G head on with the introduction of the touch-screen BlackBerry Storm. The much-awaited smartphone sports many of the features of Apple's handsets, and even outshines it in certain categories. The touch-screen smartphone may give Verizon Wireless a legitimate rival to the iPhone 3G, and it may help stem the loss of subscribers to AT&T.
The Storm has 3.25-inch touch screen that has a 360 by 480 resolution. Like the iPhone, the Storm has support for multi-touch interface, but RIM's device will have haptic feedback for its virtual keyboard, and it will be capable of cut and paste. The keyboard will have RIM's SureType layout in portrait mode, and it will be a full QWERTY layout in landscape orientation.

It will be a tough call. Getting consumers to switch from the ultra cool iPhone to the dull RIM Blackberry phones (most Blackberries have the reputation of being thick, wide and very boring). It does have several advantages over the iPhone, but will not likely appeal to normal consumers. That is a big killer, with trying to compete on the office platform / business user only. Does not give it the volume to compete with a phone that is spread over the entire consumer buying span.

Adobe launches Creative Suite 4

For some time now, Adobe (the maker of such softwares such as Acrobat, Photoshop and Flash) has been bundling its major softwares such as Photoshop, Illustrator, Digital Video, etc under one bundle (with variations) called the Creative Suite. As a result, when the Creative Suite is finally released, it is a major release; for some time before it is to be released, people put a slow-down on buying the previous version; they would rather get the latest and greatest.
A big part of the CS release is the release of a new version of Photoshop, and it is one of the most eagerly awaited products of the Creative Suites. Now Photoshop CS4 has been announced, and would be available in October. The major changes in this release include being able to use the GPU for greater speed, something that is eagerly awaited. Using the GPU allows the application to do its graphics processing faster (and that is typically one of the most time consuming portions of the overall time taken in the product).
Another major change in the release details support for 64 bit processors on the Windows platform, not much of a benefit for regular users, but more easily appreciable once the user starts moving onto much more memory-intensive work. Another areas where there is much better support is by making it easier for 3rd party developers to deploy extensions - they can create their own control panels in the form of Flash and just drop it in. Photoshop will also be integrating the latest Camera Raw Plugin (v 5.0) so that the latest version of RAW files from newer cameras are supported.
The upgrade price for Photoshop is $199 for the Photoshop CS4 and $349 for CS4 Extended; full purchase prices are $699 and $999.

Google's chrome - shaking the browser market

Just a few years ago, Microsoft would have thought that it had sewn up the browser market; then came Firefox (backed by Google as well). Firefox won a lot of converts, and seemed like the open source alternative to a market that Microsoft had almost totally won, and it won a significant minority of the browser market. For the first time after Netscape, there seemed like an open source alternative in the form of Firefox; and now, Google seems suddenly to buck all the open source support and launch its own browser called Chrome - in the process, it seems to have withdrawn support from Firefox.
Chrome however promises much more to people everywhere, an open source software that can actually serve as the backbone for an alternative to the standard desktop - no longer will applications have to choose between the desktop and the internet:

Far from a betrayal, Chrome represents the best possible future for open source developers everywhere. What Google has delivered is a giant-slayer, a self-contained WebOS that could one day supplant Microsoft's desktop hegemony. Chrome is the ultimate end-run -- around Windows, Win32/.Net, the whole entrenched ecosystem.
This is the future of FOSS, a future where Chrome becomes the OS and Linux is relegated to its rightful place as a glorified boot loader. You know that's where they're headed. You know that's Google's master plan. The wunderkinds envision a world where the OS is irrelevant, where everything revolves around their pumped-up browser and advertising-laced SaaS offerings.

Right now Chrome only exists for the Windows platform, but versions for other operating systems will be available; and one can bet that pretty soon we will start seeing applications that are made for Chrome, that showcase this platform and live up to all its promises.

The importance of news in today's world

Computers have been blamed for a number of problems that occur in today's world, but the malfunction of news reporting (causing an older page to appear and seem as current news) and the impact on a company's stock price is not something that we hear too often; neither would the investors who lost money on such a thing happening have imagined that they were watching a computer glitch. They did not bother to check elsewhere, and sold at panic levels, such is the dependency that people have on news items. Read on:

Information can live in cyberspace forever. And that cost some investors in United Airlines parent UAL Corp. a load of money Monday. Shares of UAL briefly plummeted as low as $3 early in the day -- from $12.30 on Friday -- after a 6-year-old story on the company's 2002 bankruptcy filing resurfaced on the Web and was reported as news by an investment letter.
But investors who sold at the day's lows are stuck: The Nasdaq Stock Market, where UAL stock is listed, said trades triggered by the erroneous report wouldn't be rescinded. What's more, shares of other carriers, including Continental Airlines Inc. and AMR Corp., the parent of American Airlines, also briefly dived with UAL before rebounding.

All this was caused by a series of events in which an old story got posted on the home page of a newspaper, and then got included in Google's automatic story picker (because the story had appeared as a top item on the newspaper site), which was then forwarded as part of an investment bulletin (where the researcher saw it on both the company page and on Google news and concluded it was authentic). By the time that UAL saw the news posted on Bloomberg and issued a retraction, the share had nose-dived and people had sold in panic.
People are too much in a hurry nowadays to be the first with the news, and traditional methods of confirming news and such data no longer seem to be in vogue.

Microsoft ropes in Seinfeld to bring more zest to advertising

The Windows Operating System is a massive money-earner for Microsoft; together with Microsoft Office, the software earns a huge portion of the total revenues for Microsoft. However, it has been 2 decades now since Microsoft rolled out the Windows brand and took a commanding share of the computer desktop software market. Users are slowly getting tired of this brand name, and seeking a cooler alternative, are latching onto the Mac platform in bigger numbers (they have not moved on in very high figures, but even a percentage decrease in Windows sales would be worrying for Microsoft). Another section of users have got introduced to the Mac through the Mac option of being able to load both the Mac and Windows on the same Mac machine; and there would be a number of such users who would find the Mac software more compelling (and of course, there are a number of Ads that show Mac users as cool, while Windows users are shown as nerdy). So what does Microsoft do ? It recruits Seinfeld to star in some ads designed to bring a cool look to the Windows platform:

Microsoft Corp., weary of being cast as a stodgy oldster by Apple Inc.'s advertising, is turning for help to Jerry Seinfeld. The software giant's new $300 million advertising campaign, devised by a newly hired ad agency, has been closely guarded. But Seinfeld will be one of the key celebrity pitchmen, say people close to the situation. He will appear with Microsoft Chairman Bill Gates in ads and receive about $10 million for the work, they say.
The attempted image overhaul comes as Microsoft executives privately acknowledge that Windows - the company's most important brand - has grown stale and has been battered by Apple's “Mac vs. PC” ads. Microsoft's immediate goal is to reverse the negative public perception of Windows Vista, the latest version of the company's personal-computer operating system.

The company must be really worried. Normally, the Mac has always been derided by Microsoft, and not worthy of attention; so the campaign to hire a popular comedian (even though his shows stopped production in 1998) along with a new Ad agency smacks of an effort to try and get back some freshness, some new enthusiasm among its market base.

Google's future besides search

Google is a company that has a lot going for it. It has a reputation of being a great place to work, the leader in the area of search (a field that it essentially took over and made it the big size that it currently is), and has some solid public relations going for it (the fact that it continues to vanquish Microsoft means that more people see it in a positive light). The stock of the company continues to remain high. But all good things have to come to an end. Slowly, the sheen is starting to wear off and there are more critical analysis of the company that are starting to emerge. One major area for critical analysis is about the success of the company in fields other than search:

Google has been the world's hottest technology company for almost six years now. The Mountain View company not only completely dominates the search engine business, but it's had an absolute lock on Silicon Valley's psychology. Every new beta product that debuts generates enormous attention and seems to promise to revolutionize one more slice of the Web and communications. Just this week came the latest numbers from comScore indicating that Google increased its search market share over Microsoft and Yahoo. And the takeover squabble between those two has just reinforced the perception that Google has an almost unassailable position as the leading technology company.
"Name me anything they've been successful in beside search," Chowdhry said. "I think the board and management of Google need a total overhaul." OK, that's harsh. On the other hand, according to Google's own securities filings, the company expects its margins on advertising to continue to shrink and its revenue growth in this area to continue to slow. In addition, all those high-profile ventures the company has launched, and the acquisitions it's made, have yet to contribute much to the bottom line. In a filing with the Securities and Exchange Commission, the company noted that revenue from services such as YouTube, Google Checkout and a host of others "were not material."

Youtube in particular was much mocked (especially among the online community), since a purchase of $1.6 billion is not a small amount and a lot of analysts were unable to figure out as to how Google will make money on this transaction. It's other purchases such as Picassa, and initiatives like Google Earth, are seen as cool, and fitting into the ad space in the long term theme of things, but are a very long way away from making money. No one of its stockholders would grudge the purchase of something like Doubleclick, but stuff such as Picassa do not seem to make sense.

Apple willing to let BestBuy sell iPhones

Apple has a gold mine in the shape of it's iPhone, a device that continues to generate significant customer demand, and in fact so much demand, that if a customer wants to buy an iPhone in a AT & T store, there is a waiting time of around a week. Outrageous, some people would say, it's a device after all. But the iPhone has turned out to be such a hot device that people queue up to buy the iPhone, and Apple has sold millions of them so far. However, Apple hasn't exposed the phone in the retail market outside of the Apple and AT&T stores, and this restriction must still be limiting the number of phones they are able to sell. Well, it looks like they have re-considered; there seems to be an agreement to allow BestBuy to stock iPhones in BestBuy stores. Given that BestBuy is the largest electronics goods retailer, seems like Apple could expect a bump in the sales:

In a move that will significantly expand its retail presence in time for the holiday season, Apple has agreed to let retailing giant Best Buy sell the new iPhone 3G through its nationwide chain of Best Buy Mobile outlets starting early next month. Best Buy markets cell phones in the United States through 970 full-size stores and 16 stand-alone Best Buy Mobile shops. All U.S. Best Buy stores will carry the iPhone except for a handful of outlets located in areas where AT&T does not provide cell phone coverage.
For Best Buy, which has been angling for the iPhone business for more than a year, the deal will add Apple’s cachet to its expanding smartphone offerings and help drive traffic to new Best Buy Mobile departments within its stores. Best Buy is aggressively marketing a variety of smartphones, from RIM BlackBerry Curves to Palm Treos, and is the exclusive reseller, with Sprint (S), of the Samsung Instinct, one of the iPhone’s nearest competitors.

This will push the iPhones into the hands of a larger number of consumers, and given impulse purchases, may lead to a bump up in sales for the iPhone. After all, a consumer going to buy some other phone may come across the iPhone and decide to buy. What is not yet clear is about how the activation will be handled for these iPhones.

Yahoo shareholder meet ends tamely

With the recent agreement between the Yahoo board and the shareholder challenge of Carl Icahn which gave Carl 3 seats on the board, the issues confronting Yahoo in terms of shareholder challenge seem to have died down. Otherwise why would the proceedings from the Yahoo board meeting end like this ?

It's almost as if the past six months never happened. Yahoo's much anticipated annual meeting on Aug. 1 left its current board and co-founder and Chief Executive Jerry Yang intact, in control, and still insisting they can return to contention with runaway rival Google. Despite rampant shareholder anger that the Internet icon couldn't close any of a series of deals with Microsoft since the software giant's unsolicited $45 billion buyout bid Feb. 1, the long-delayed annual meeting was remarkable mostly for how little happened.
Nonetheless, the vote still indicates that a significant portion of shareholders remain dissatisfied with Yahoo's direction. The most pointed criticisms during the meeting came from Eric Jackson, who runs a Florida-based firm called Ironfire Capital He called for Bostock and two other directors to step down and for Yang to give up the CEO seat to a more experienced executive. "They're basically saying, 'Believe in us,'" Jackson said after the meeting. "There are too many people who have been there too long and we need new management from outside."

I don't think that this is the last anyone has heard of this entire issue. Yahoo is not likely to be able to outwit Google, and shareholders will remain dissatisfied with the performance and the share prices. Future revolts cannot be ruled out.

Net neutrality: FCC scolds Comcast, but does not fine

The subject of net neutrality has been occupying a lot of discussion bandwidth over the past several months; the basic discussion point has been about whether the internet service providers can discriminate between the different types of content flowing through their pipes. The current policy is that users have the right to do whatever they want with their internet connectivity; so if they want to do file-to-file sharing or downloading videos, then the service provider is not supposed to tell them whether this is a permissible activity or not. The various internet providers in the United States have been advocating that such a policy prevents them from being able to make improvements in their networks.
After all, the biggest flow of internet information is typically with sites that promote P2P (and for torrent and others, this is a client to client exchange without going through a central server), or with users downloading videos or watching live videos. The ISP's have wanted to be able to set limits on this, and this is something that has just been blocked by a divided decision of the Federal Communications Commission:

Federal regulators issued a warning to all Internet service providers Friday with a sharp rebuke of Comcast Corp. for blocking some customers from using file-sharing technology. By a 3-2 vote, the Federal Communications Commission found that the cable company failed to tell its subscribers about the blocking, lied about it when confronted by the commission and tried to cripple online video sites that compete with its on-demand service.
Supporters said the FCC decision would set a landmark precedent in the battle over whether Internet service providers can give priority to certain types of traffic, an issue known as network neutrality. The FCC ordered Comcast to stop the blocking and provide details about its Internet practices, but declined to fine the Philadelphia-based Internet service provider, the nation's second-largest. Public interest groups, online activists and large Internet companies fear that cable and phone companies will start charging websites for faster delivery of their content or block access to sites that offer competing services.

It is not at all difficult to believe that if ISP's are given the permission to be able to set limits on certain types of data movement, then they could take this a bit further and set up deals with sites to promote their content or let it move faster. The internet cannot be made hostage to the machinations of ISP's and their corporate interests.

Nintendo keeps on leading

The Nintendo Wii seems like magic. Good user design and usability considerations along with a great word of mouth publicity has done what no amount of marketing push and technical specifications could have done; for the past considerable period of time, it has kept on pushing both the PlayStation 3 and the Xbox360 by the side, and kept on generating a huge amount of buzz for itself. If you look at these figures, you can see why both Microsoft and Sony are despairing:

Nintendo DS topped the selling hardware chart with 783,000 units sold, followed by Wii (666,700 units), PlayStation3 (405,000 units), PlayStation Portable (337,400 units), Xbox 360 (219,000 units) and PlayStation 2 (188,000 units). Nintendo maintained strong top 10 positions in terms of software sales, for DS and Wii: Guitar Hero On Tour at number 2, Wii Fit with Board at number 4 (372,700 units), Wii Play with Remote at number 5 (359,000 units), Mario Kart Wii with Wheel at number 7 (322,400 units), Lego Indiana Jones: The Original Adventures for Wii (294,000 units) and DS (267,800 units) at number 8 and 9.

Both Microsoft and Sony are trying every trick in the trade, whether that means reducing the price of the unit (Microsoft) or releasing upgraded versions for the same prize (Sony). Both of them are more or less clueless right now as to how to catch up with Nintendo; the Wii is way ahead in terms of customer perception.

Yahoo proxy fight comes closer to resolution

It's almost like a soap opera in the financial sense. The fight between a Microsoft looking for ammunition in its battle against Google, and a Yahoo that is fighting a losing battle in front of a rampaging Google and a fighting Microsoft seems to be approaching a point where Yahoo is still struggling to stay afloat as an independent entity. In the end, it comes down to a point where the shareholders of Yahoo (institutional shareholders) have to decide whether to stay independent or to join up with Microsoft in order to get a better price for their shares:

It looks like the bar room tete-a-tete in Sun Valley, Idaho last week may have helped one of Yahoo Inc.'s biggest institutional shareholders make up his mind.
Friday's news from Bill Miller, chairman and chief investment officer of Legg Mason, that he intends to support Yahoo management in its proxy fight with activist investor Carl Icahn was a big coup for embattled Jerry Yang & Co.
Now that Miller has indicated which way he is voting Legg Mason's 4.4% stake in Yahoo, all eyes will be on other institutions with large holdings in the Internet portal. Perhaps one of the most influential is Gordon Crawford, a portfolio manager at Capital Research Global Investors. Its parent company, Capital Group Cos. has at least three funds with a combined stake of nearly 17% in Yahoo, making it the largest institutional holder. Some pundits have speculated large institutional shareholders do not typically lead activist campaigns. But Miller coming out with a statement in support of Yahoo management two weeks ahead of the much-anticipated shareholder meeting scheduled for August 1 could inspire other funds to try and persuade other investors to take their side.

If it comes to a resolution where the shareholders back Yahoo, then the issue does not get resolved. It is a fact that Yahoo is losing in the fight, and unless this gets resolved, shareholders of Yahoo will not be able to see the value of their shares rising.

Microsoft teams up with Icahn for a Yahoo bid

After the bid by Microsoft died, there was a lot of resentment against the cussedness of Yahoo in refusing this bid. Many institutional holders of Yahoo stock were thoroughly frustrated by the refusal of the Yahoo management to agree to the Microsoft offer, since that would have meant that they would have been able to get a higher return than what the market was offering. One result of that was that the stock raider, Carl Icahn made a bid to acquire control of Yahoo through hostile action. And now Microsoft has teamed up with Icahn:

A statement by Microsoft Corp. (MSFT) that it remains interested in acquiring some or all of Yahoo Inc. (YHOO) has increased the likelihood activist shareholder Carl Icahn may gain control of the Internet company's board in a proxy fight next month. Microsoft confirmed on Monday that Chief Executive Steve Ballmer had met with Icahn recently to discuss the prospects of resuming its bid for Yahoo in order to bolster its Internet presence.
The blog said Gordon Crawford of Capital Research Global Investors, Yahoo's second largest shareholder with a 6.5% stake, told Yang and other board members that he was seriously considering voting against Yahoo. Some analysts said discussions between Icahn and Microsoft may allow the activist to push through his nominees. "This is enough to sway Yahoo shareholders," said Clayton Moran, an analyst at Stanford Group.

This whole Microsoft effort to gain control of Yahoo is now going on for many months, and does not look likely to go away anytime soon. They have support of quite a few shareholders, but at what point will a majority of shareholders decide that Yahoo just does not have it anymore to remain independent and switch over to a Icahn-Microsoft bid ?

Apple iTunes store has sold 5 billion songs

This is a landmark for the music industry. For many years, the traditional music industry (with their physical media) has bemoaned the presence of digital music downloads. Initially, the presence of ripped off MP's (illegal MP3's) were blamed for the decline in sales of the traditional music media. The industry fought these networks with full fury, and managed to kill most of the organized rippers (although they are facing more challenges fighting the more dispersed Bittorrent networks). In the midst of this fight, Apple initiated the combination of the Ipod and iTunes (store combination) in 2003 and managed to slowly increase its market share. The traditional delivery industry slowly accepted digital availability of songs due to the legal restrictions and use of technology to prevent copying that were bundled along with these songs; and the combination of iTunes and iPod became such a huge success that it has beaten all the other retailers (even a behemoth such as Walmart):

Apple Inc. has surpassed Wal-Mart to become America’s No. 1 music store, the first time that a seller of digital downloads has ever beaten the big CD retailers. Apple sold more albums in January and February than any other U.S. retailer, market research firm NPD Group said Thursday, underscoring how the music industry is on the front edge of a digital media shift that is upending businesses as diverse as bookstores and video game makers.
U.S. consumers still buy more CDs than digital downloads, but the gulf is narrowing rapidly. Only five years after launching its iTunes digital store, Apple has dominated the fast-growing download market so completely that it jumped ahead of individual CD sellers such as Wal-Mart, Best Buy and Target. “It’s a major milestone,” said Tom Adams, president of consulting firm Adams Media Research. “It is the first instance of an electronic venue surpassing a [bricks-and-mortar] retail venue for any kind of media delivery.”

And this is not the only field; traditional newspapers are feeling the heat from online versions; even iTunes itself is slowly making its name for itself in the field of movie downloads.

The Browser wars - a new version

Just a couple of years ago, it seemed that the browser wars were from a different era. After the initial clashes between Microsoft and Netscape and the victory by Microsoft in these wars (ignoring any possible challenge by the nascent Opera at that time), the era of the Browser soon stagnated. Microsoft puts development work on a new version of Internet Explorer seemingly in cold storage.
And then came in the 2 aspects that changed the game: The emergence of Firefox as a strong contender for the title of the most popular browser (it helped that it was seen as a better and more standards compliant browser + a number of add-ons started getting developed for the browser); the other major game that has changed the rules was the emergence of Google as a company that makes most of its money from ads (with most of these ads coming in from the ads that appear when a user makes a search). Now it seems that the competition is hotting up, with Opera and Firefox releasing new versions, and Microsoft currently working through the public beta. Already, the release of Opera and Firefox has lead to an evaluation of which is better, and the answer depends on which way you look at things of Internet Explorer 8:

Firefox 3 is, of course, the big news of the week, pulling down eight million or so downloads in its first 24 hours in the wild. However, the Opera browser updated to its much-awaited version 9.5 last week. Empirically, the two most-cited complaints about browsers are speed and memory.
Using the SunSpider JavaScript test, Firefox 3 scored around 5500 microseconds to process the tested scripts, with a margin of error at around three percent. Opera 9.5 scored about 7280 microseconds on the same test, with a margin of error around 1.5 percent, making it nearly one and a third times as slow as Firefox 3.

And we have not even included the effort by Apple to make the Safari browser more mainstream, depending on the iPhone bundling Safari to really give it a push. The winner may not be the best (and anyhow, it depends on which test you use).

Eye-Fi Card card helps catch thief

This is a story seemingly out of science fiction, but in reality happened. People unfortunately have a recurring tendency to forget their belongings; remember the times when somebody claimed that they lost their laptop or phone in the cab or train, or left the purse or wallet in the restaurant / hotel. By the time you remember, it is too late, it is only rarely that you get your belonging back. And of course, if it has been stolen, then the chances of getting it back is almost nil.
Well, here is a case where the camera that was stolen (and from which previous personal photos had not yet been retrieved) phoned back through the medium of the Eye-Fi card and even sent back photos of the thieves (the precious personal photos were also sent back). This happened through some coincidences, but is still remarkable:

Here's a new use for the Eye-Fi wireless SD card that we hadn't considered: A virtual private eye. Eye-Fi user Alison DeLauzon lost $1,000 worth of photo gear while on holiday in Florida. The Eye-Fi SD card, once plugged into your camera, hooks up to the internet and sends your photos to either an online sharing site or directly back to your home machine. In this case it was the latter, and the hapless thief not only sent the precious vacation shots back to Alison's computer, but -- according to the email we received from Gadget Lab reader Joe Volat -- "pictures [of] the thieves proudly displaying Alison's lifted camera equipment."

Japan's phones - the wonders of the world ?

Anytime when one looks at advanced phones, the market that most comes into mind. Top non-Japanese phones such as the iPhone, and Nokia's N series don't even come close to the advancement of the phones sold in Japan. It was many years ago that the NTT DoCoMo network had reached 3G capabilities and sold phones that amazed the rest of the world. However, such advancement comes with own problems; trying to pack in so many features and yet meeting goals of being able to make the phone very usable makes the task of designers very difficult. In the end, there is only so much that one can do with the limited number of keys and overall phone size, and the various combinations that Japanese phone makers have come up with to provide the range of applications available can confuse the most advanced of users. If you remember the old joke about not being able to set the time on the VCR, this is way beyond that. Get a glimpse of how things actually are:

Indeed, Japanese handsets have become prime examples of feature creep gone mad. In many cases, phones in Japan are far too complex for users to master. "There are tons of buttons, and different combinations or lengths of time yield different results,'" says Koh Aoki, an engineer who lives in Tokyo. Experimenting with different key combinations in search of new features is "good for killing time during a long commute," Aoki says, "but it's definitely not elegant."
Japan has long been famous for its advanced cellphones with sci-fi features like location tracking, mobile credit card payment and live TV. These handsets have been the envy of consumers in the United States, where cell technology has trailed an estimated five years or more. But while many phones would do Captain Kirk proud, most of the features are hard to use or not used at all. Japan is a culture of spec sheets. When consumers go to electronics stores to buy a cellphone, they frequently line up the specifications side by side to compare them before deciding which one to buy.

In contrast, phone makers such as Apple and Nokia have been behind on the feature list, but are seemingly way ahead on making phones look good and be very usable.

A leading retailer drops Microsoft's Zune

Microsoft a few years decided to step into the field of consumer electronics in a limited way, with efforts for both gaming consoles and MP3 / Media players. Both of these are fast moving items, with fierce competition, an extreme focus on features, and ability to turn users into die-hard fans. In both these areas, there were entrenched players in the field when Microsoft made its entry - in gaming consoles, Sony's Playstation and Playstation 2 (and Nintendo in a smaller way), as well as Apple's iPod in the field of MP3/ Media player were both established players with very strong market shares.
Microsoft on the other hand has a very strong marketing strength, as well as presence in the customer software segment; however, Microsoft had to build up a mind and market presence in the actual consumer devices retail positions. This takes time and effort, and you need to show increasing market share. This has now suffered a setback, with one of the leading retailers, GameStop deciding to stop stocking the Zune (Microsoft's personal media player) due to inadequate sales:

Microsoft's entry into the consumer electronics space came with a thorny channel problem. To succeed in capturing a broader audience, Microsoft had to broaden its retail channel. The Xbox business helped take care of that problem: once Microsoft proved that it was serious about developing and promoting the first Xbox, and once it began to show reasonable sales figures, a new class of retailers--including game-specialty stores like GameStop--were happy to make shelf space for Microsoft's consoles and games, right alongside Sony and Nintendo.
Apparently, after giving it a year and a half, GameStop has found that's not the case. Looking at recent NPD figures, it's easy to see why--compared with the first Xbox, the product just isn't moving nearly as many units (2 million in 18 months) or capturing enough market share.

Still a bit early to write off the Zune, but it just is not capturing any imagination, and in the meantime Apple has moved ahead with the iPod Touch / iPhone, capturing the wow effect.

Nintendo Wii Fit going to increase Wii sales

The Nintendo Wii has been the leader in the field of video game consoles, leaving the much more powerful Sony PlayStation 3 and the Microsoft Xbox 360 way behind. Consumers have been attracted by the power of the simplicity of the console and its usability, specially the motion sensing capability of the Wii remote that allows users to be more interactive with the game and brings a much better handling of the games. This has continued, with the Wii steadily out-selling the other gaming consoles, and more games being written for the Wii over a period of time (inspite of the much more powerful marketing power of Sony and Microsoft).
Now, Nintendo is coming out with a game that is very eagerly awaited, and promises to let people overcome the couch potato effect of a video game console, instead they get a way to become fit:

Nintendo will be releasing the newest of its exercise games, the Wii Fit on May 19th and you can expect it to fly off of the retailer shelves. But just who will be buying it? Many expect that our mom's will be buying them, at least according to some analysts and some research. The Nintendo Wii has been more popular among women than the Microsoft Xbox 360 and the Sony PlayStation 3, but some analysts believe that this game that combines exercise and entertainment will help put Wii sales over the top again.
Wii Fit will retail for $89.99 and will include a balance board to facilitate the more than 40 yoga, aerobics, and strength training exercises. The user sets their own fitness goals and keeps track of their progress over time.

If this truly turns out to be well designed, then this well and truly ensure that Nintendo keeps its lead over the other game consoles; further, there are not many analysts now who actually believe that Sony and Microsoft will be able to challenge this dominance in the near future.

iTunes to allow movie download same day as DVD release

Apple's iTunes had always been seen as somewhat of a threat / opportunity for the industry. The opportunity was always there since it was the legal way for the recording industry to make money from the downloading of music, while the way in which Apple behaves (driven by Steve Jobs) scares the recording industry. Apple is the one which always seeks more control over the entire process and does not seem to care as much for the dictates of the recording industry as other channels do. In a step forward, and scaring the conventional sales channels of the movie DVD industry, Apple has now declared that it will make downloads of movie available on the same day as DVD releases:

Although the vast majority of all sales of movies are done on DVD, likely at mass market locations such as Wal-Mart, there is a slowly growing population of those who are playing for digital downloads. Such a phenomenon is becoming well established in the realm of music, where users of iTunes will pay 99 cents to download a song. Apple is now hoping to bring the same level of success it did to music over to movies.
Movies purchased from iTunes can be viewed on an iPod with video, iPhone, Mac or PC or on a widescreen TV with Apple TV. New release movies will be priced at $14.99 and older catalog titles at $9.99. The iTunes Store current carries over 1,500 films at present.

This is likely to covert into an increased share of the market. So even though there will be people who will be wanting a physical DVD, there will be a large number of people who will settle for the convenience of being able to download a movie onto their device of convenience and jump onto the iTunes bandwagon. This is bound to have an effect on the regular store sales of DVD's and will make them more unhappy.. tough luck, this will not go away.

Impending News: Microsoft to increase offer for Yahoo

There is a lot of buzz in the press that Microsoft may increase its offer for Yahoo so that a deal becomes much closer. The press reports claim that Microsoft is very close to increasing its bid so that the impasse can get over and Yahoo becomes amenable to a negotiated deal rather than a hostile offer. From Bloomberg.com:

May 3 (Bloomberg) -- Microsoft Corp., closing in on the biggest acquisition in its 33-year history, may seek to end an impasse with Yahoo! Inc.'s board by raising its takeover offer, a person familiar with the matter said. Talks intensified this week after Yahoo spent three months hunting for alternatives to the deal.
A higher offer may win over Yahoo's board, eliminating the need for Microsoft Chief Executive Officer Steve Ballmer to go to shareholders with a hostile offer, which might have spurred an employee exodus. A deal also may halt Yahoo's efforts to forge an online advertising partnership with rival Google Inc.

The deal remains important for both Microsoft and Yahoo. The more that the deal remains out of touch, the more likely is that Yahoo and Google will come to sort of agreement that will pass regulatory approval, and leave Microsoft way behind Google. For Yahoo, it is a now a diminishing third player and no longer seems to have the ability to move to second position.
Ultimately, from all the discussion, it would seem that the entire issue now resolves around the price to be paid. Yahoo claims that the offer under-values the value of Yahoo, and many of the prime shareholders seem to agree. So if Microsoft increased the offer, it may break the impasse and convince the board.

MySpace will launch MySpace Music

MySpace is a very popular social networking site with the tens of active million users making it a very important portal overall. One of the popular features that keeps a lot of users on the site is the music feature. This has always annoyed the music labels, and finally they are getting a solution that is making them happy.

The social networking heavyweight announced Thursday that it has deals with Sony/BMG, Universal and Warner music labels to transform its current music offerings into a full-fledged jukebox of streaming and downloadable music. As the new features are rolled out in the coming months, MySpace Music will evolve into "what we think is going to be a transformative music experience for the user," says MySpace cofounder Chris DeWolfe.
Under the new agreement, De Wolfe says that labels plan to offer artists' entire catalogs for free listening and for-pay downloads. "We are considering a subscription model as well if it makes sense," he says. In an earlier interview, DeWolfe did not announce a pricing scheme nor would he say whether downloads would be MP3s or another format, or whether they would contain digital rights management. "Not all the music companies have embraced full non-DRM downloads," he said. "I personally think that is where the market is going but that will be a decision all the music companies will have to make."

From initial trends, it seems that the deal is something that record labels are happy with, and that will translate into terms that a lot of users may not end up liking. One has to wait and see how this will turn out.

Microsoft not going to increase offer for Yahoo

A typical takeover effort typically starts with a negotiating bid, that is normally not exceptional, and then over a period of time, there is pressure for the bid to go up. What typically happens at this time is that more contenders will jump into the fray, putting pressure for increasing the bid; also, what may happen is that the board of the company being acquired pushes for a higher bid as a condition of accepting the bid; and in some cases, influential shareholders holding significant shares may agree to tender shares if the price being paid is increased.
However, the saga of Microsoft's takeover of Yahoo is not following any of these trends. The refusal of Yahoo's management to accept this offer was not a surprise, but everything else is. The value of Yahoo's bid is overall so high, that no white knight could be found who would be willing to fork out that kind of money. Not much of relief to Yahoo in this regard. Microsoft has also steadily refused to increase its bid so far, maybe in the expectation that eventually the pressure of investors and employee morale decrease will force Yahoo to accept, and there are signs that this may be happening:

Microsoft Corp is evaluating its bid for Yahoo Inc because the Internet company may have lost value since Microsoft made its offer, people familiar with the matter said on Friday. The news, first reported by Reuters, sent Yahoo shares down more than 5 percent in extended trade.
After weeks of silence, recent comments from various sources to journalists suggest the software maker is hardening its stance and pushing Yahoo for action. The sources told Reuters that Yahoo has lost key personnel, making the company less valuable, while generous severance packages it handed out to executives and full-time employees in the case of a takeover have made it more expensive.

Of course, if Yahoo starts to lose key personnel and the industry sees much lower growth, then any hint of Microsoft lowering its bid may have a very strong impact on Yahoo. To some extent, analysts have made this deal a done deal in the end, that is, no matter the discussions, the deal will be made (in order to give the 2 companies a fighting chance against Google).

Sony changes plan to charge for removing 'bloatware'

When you buy a new OEM machine, it comes with a lot of programs that are on trial, such as anti-virus software trial versions, and numerous other software. There are 2 advantages for the makers of these software as well as for the computer manufacturers. The software makers depend on a proportion of consumers becoming attracted enough towards these applications that they are willing to pay for buying these programs. Getting these softwares pre-installed on the machine helps expose them to a much higher number of consumers and increases the chances of conversion. For this advantage, these trial software makers pay computer manufacturers for the chance of placing their software on these machines. It is estimated that xomputer manufacturers can make more than $50 per machine from such software.
For a vast majority of the final consumers / buyers of the machine, these software consume hard disk space, as well as run all the time slowing the machine down. Most consumers will not know how to remove such software, and suffer. For an advanced user, the options include removing the programs one by one, or by doing a fresh install on the machine that will remove these software, called 'bloatware'. So, imagine the pleasure of consumers when Sony declared that it will give a machine that does not come pre-loaded with such software; then this pleasure turned to shock when they found out that Sony will charge them $49.99 for removing this bloatware. There was a strong reaction to such a move; imagine paying extra to have the manufacturer not loading extra stuff on the machine:

"Bloatware" is a term that is familiar to many new computer buyers. Most new computers come saddled with HDD and memory-robbing applications like trial versions of antivirus programs, various desktop search and chat applications, or perennial offenders like Adobe Acrobat. Computer makers rely on these add-on programs to generate additional revenue in the age of decreasing computer prices -- bloatware can add as much as $60 in additional revenue for each computer sold.
Sony, however, made the unwise decision to charge customers a $49.99 fee for the bloatware removal. Whether the charge was intended to somewhat makeup for the estimated $60 windfall from the application publishers or just an effort to squeeze more money from its customers remains to be seen. News of the $49.99 Fresh Start fee quickly spread around the Internet Saturday with sites taking Sony to task over the blunder. Sony quickly recoiled and removed the Fresh Start fee.

This quick reaction by consumers and Sony's quick acceptance of this customer outrage shows that corporations are quickly cottoning onto the fact that customers, especially in this age of quick communications can turn reactions against a company very fast. Sony last suffered such a bad reaction over their Rootkit fiasco, and the prolonged bad press at that time would have made them much nimbler this time.

Some of Microsoft's dealings with Intel and HP revealed

It is not often that the internal dealings of a company such as Microsoft are released to the public for analysis, especially when it deals with the interaction of the company with other major chip and computer manufacturers such as HP and Intel. But, a federal class-action lawsuit provides access to internal emails that are worrisome to customers who have bought machines labeled Vista capable; they can no longer be sure that the certification provided by Microsoft to such machines is genuine. Read this article and these excerpts to understand more:

But documents show that in early 2006, a full year before Vista's release, there was intense discord within Microsoft over its dealings with Intel, HP and others in preparing to roll out the new system. The documents suggest Microsoft bowed to Intel's pressure in certifying certain chips as capable of running the new operating system to enhance sales. Intel declined to comment on assertions that it had pressured Microsoft. "It's private litigation between plaintiffs and Microsoft, and we're not a party to it," Intel spokesman Chuck Mulloy said.
At issue is whether Microsoft misled customers by labeling PCs carrying the Intel 915 chipset as "Vista Capable" when they were put on sale in spring 2006, ahead of the much-anticipated launch of the Vista operating system. Only computers labeled "Premium Ready" carried the more advanced Intel 945 chip and could operate Vista's touted features, such as Aero graphics.

If all this is true, it is tantamount to deceiving computers. Customers buying computers do not have the technical competency to evaluate whether a particular chip and computer were capable of running Vista; if the certification says that the chip is capable, the customer would believe so.

What will Google do against Microsoft and Yahoo ?

Microsoft really threw a major push when it announced an offer for Yahoo. For some time now, Microsoft has been smarting at being beaten by Google fair and square in the world of online search and advertising. This was a field that was essentially (not completely true, but approximately) invented by Google, and they have a commanding lead over both Microsoft and Google. Google has essentially been a seach / advertising company that is now trying to do other things, while Microsoft has been a major desktop company that is struggling to replicate its success in the online world (through a spate of new technologies and purchases), while Yahoo has tried to be a massive directory (and seeing the success of Google, tried to also focus on the advertising world). Google has had the benefit of some focused approach on the advertising world, and has reaped the benefits.
Yahoo has been seen as a company on the downward path, and all its efforts have not been able to push it up; it has been seen as having been outplayed by Google, and recently suffered the fate of having to layoff people (not a good sign for a company trying to be the best). It makes tremendous sense for Microsoft to suddenly gain a massive catch up by getting all of Yahoo's business.

According to a Reuters report, Yahoo said it would consider joining forces with Google in order to prevent Microsoft from acquiring it. What sort of partnership could it strike with Google that would hold Microsoft at bay while not triggering antitrust issues? Oh, and Yahoo says $31 per share isn't good enough.
Yahoo's managers have a lot of thinking to do. Microsoft's offer of $44.6 billion was not exactly a low-ball first bid. That represented a 61% premium over Yahoo's stock price on Thursday (Yahoo's stock has since gone up). Yahoo feels that the $31 per share offered undervalues the company. It didn't say that it had requested a higher number from Microsoft, which has indicated it will use cash and loans to buy Yahoo. Sanford C. Bernstein analyst Jeffrey Lindsay suggested that Yahoo's real worth is closer to $39-$45 a share.

The fact remains that the final decision rests with shareholders, who may feel that unless a white knight comes into the picture (who can afford to pay more than $50 billion), Microsoft represents the best bet in terms of growing the business and taking on Google.
Google is not likely to take this lying down. A good first bet would be to appeal to Yahoo's management who would be apprehensive (or rather sure) about their diminished status in a Microsoft pecking line; in addition, there is the entire history of Microsoft's uncompetitive behavior to be thrown up, another good approach is to talk about the obvious problems of pairing the market leaders in online email and messenger. Microsoft would have likely prepared for all this, and one can be sure that there will be a lot more focus on making the Yahoo shareholder see this as a good step forward.

Apples doubles capacity of iPhone and iPod Touch for $100

The iPhone and iPod Touch (and earlier the iPod) have done wonders for Apple, given the massive customer demand and the can't get enough of iPhone need of customers. I was watching a couple of iPhone users give a demo of the phone to friends who did not have the iPhone, and you literally see these people (admittedly geeks) were positively in love with the gadget; you really don't see that happen to people having other phones and gadgets.
Now Apple has decided to try and squeeze more money from people. Given that a lot of the buying of the iPhone used to happen for the higher-capacity 8 GB phone, it was natural for Apple to add more storage, and in the process, charge an additional $100. After all, why not make money when people are willing to give.

Apple doubled the capacity of the iPhone and the iPod Touch on Tuesday for an additional $100. The iPhone once again comes in two capacities: 8GB for $399 and now 16GB for $499. Apple sold 8GB and 4GB varieties on iPhone Day, but it discontinued the 4GB model after it cut the price of the 8GB model to $399. Something like 90 percent of all early iPhone buyers opted for the 8GB version.
And the iPod Touch can also store more music and videos now, with 32GB of capacity for $499. That device is now available in three versions, with Apple also selling a 16GB model for $399 and an 8GB model for $299.

There was a slight reduction in the sales figures for the previous quarter, something that should scare Apple to some degree. So the announcement of these new models should be a good answer to industry analysts, since there will be a number of users who will buy the highest capacity device, netting Apple an extra $100 in the process. The question however remains as to when Apple will overcome some of the shortcomings in the device, such as addressing 3G connectivity, and providing an inbuilt GPS solution.

HBO joins the online TV content fray

HBO, one of the last holdouts in the age of providing digital entertainment media online, has finally given up (or maybe acknowledged that it will lose out on a whole bunch of subscribers if it does not enter the race) and launched a service called HBO On Broadband that features 400 hours of both movies and serials that can be downloaded onto a computer. However, as of now, there are several restrictions, with these restrictions across computer platforms, and locations:

The catch: To gain access, you must be a digital cable customer who subscribes to HBO, and you must use your cable company as your Internet provider. And, at least initially, you must live in Milwaukee or Green Bay, where Time Warner Cable will first test the service. (There's no extra cost for online access.)
HBO Broadband offers a broad selection of programming, including 130 movie titles that rotate monthly and top hits ranging from The Sopranos to Sex and the City, as well as documentaries. Usually, about six episodes will be offered at any one time, but for one series every month, every episode ever produced will be available. HBO co-president Eric Kessler blames technological issues for the delay in offering online video but says the new service continues the network's plan to "enhance the value of the HBO subscription by giving viewers greater access to our content."

This is almost like testing the waters, and one can forecast that geographical locations will get added, and so will more controls to prevent piracy. And right now this service is free, but one can be sure that at some point, HBO will want to make money with this.

The porn industry and the Blu-Ray and HD DVD format wars

The last time there was a major battle for the next generation of video formats, Sony was on the losing side, and the porn industry had a major role in deciding the winner. Sony, being unwilling to have any association with the porn industry, made it difficult for the porn industry to employ the Betamax format, and this played an important role in the loss of the Betamax against VHS.
And now there is a new format war, with Sony on one side with its Blu-Ray and Toshiba with its HD DVD format. However, this time, the porn industry is not that much of a factor. There are many other players, such as the major studios, players such as Microsoft (with its gaming console having a video drive), and so on. And there are pros and cons for each. Blu-Ray is seen to be more expensive, and more complex to use, but then Warner Bros last week decided to move over to Blu-Ray giving it a major shot in the arm.

The adult film industry is still taking a wait-and-see approach to the Blu-ray /HD DVD wars. But while Blu-ray's perceived costs have pushed some companies into the arms of the HD DVD camp, Warner Bros.' decision last week to exclusively support Blu-ray has some thinking that the end of HD DVD is nigh.
The Blu-ray camp, led by Sony, has been fighting Toshiba and its HD DVD format for years in a battle reminiscent of the VHS versus Betamax battle. In that fight, Betamax maker Sony's refusal to work with the porn industry helped usher in a VHS victory when the adult industry capitalized on the burgeoning popularity of VCRs and video rentals.

Right now most industry players are straddling the fence, keeping both options open. The porn industry has been playing both formats, and has not really taken a firm stand. A good probability is that they will watch the way things trend and then take a decision.