EU court to deliver Microsoft ruling By AOIFE WHITE, AP Business Writer

EU court to deliver Microsoft ruling By AOIFE WHITE, AP Business Writer
Sat Sep 15, 5:43 AM ET



BRUSSELS, Belgium - When Europe's second-highest court rules Monday on Microsoft Corp.'s appeal of its landmark antitrust conviction, more will be at stake for regulators than just the behavior of the world's largest software company.

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Experts say an affirmation of the European Commission's 2004 order and record 497 million euro ($613 million) fine could embolden regulators as they pursue probes of Intel Corp., Rambus Inc. and Qualcomm Inc., among others.

But a major victory for Microsoft could turn the regulatory landscape upside down, curbing the ambitions of European officials who have recently taken a more aggressive stance against alleged monopolists than regulators in the United States.

The 13 judges on the Luxembourg-based Court have been considering Microsoft's appeal for 15 months. Judge Bo Vesterdorf — on his last day on the job — will read the order that could change how the world's most powerful corporations are regulated by Europe.

The case started in the 1990s with complaints from Microsoft rivals about how the software giant used its presence on most desktop computers to elbow into new markets and block competitors. It's also always been about something more — nothing less than the role of Europeans in the regulation of U.S. companies.

If the Commission's tougher approach is upheld, that means U.S. companies with a global presence will have to conform to Europe's rules, said Keith Hylton, a professor at Boston University School of Law.

"The end result is, the EU ends up being the global regulator of dominant firms," he said.

Both sides can appeal the decision Monday to Europe's highest court.

The case, which originated from a 1998 complaint by U.S.-based server maker Sun Microsystems Inc., has become a classic David and Goliath tale. Here, however, both sides claim the role of David.

EU regulators say they're battling a corporate bully that stifled competition and used its Windows monopoly to muscle in on new markets — media players and servers. A similar U.S. Department of Justice case against Microsoft was settled in 2002.

Microsoft counters that it's the one being bullied by regulators who imposed heavy fines and buried the software maker under reams of criticism without suggesting specific remedies for their complaints.

On March 24, 2004, the European Commission found Microsoft guilty, ordering it to share the code that would help rivals' servers work well with Windows and make a version of its operating system available without its media player software. It also levied the record-setting fine.

How much Microsoft has complied with the code-sharing order is still up to debate. Last year, it was fined an additional 280.5 million euros ($357 million) for failing to supply the "complete and accurate" interoperability information. Microsoft has said it will appeal that decision.

The company also offered a version of Windows without its Media Player — a year and a half after the initial ruling. The software designed by EU lawyers was a total failure. No computer makers bothered to ship it with new PCs.

The case is about "whether or not the state can force a company to provide its research and development to its direct competitors at little or no cost," said Microsoft lawyer Erich Andersen.

EU spokesman Jonathan Todd said Microsoft does not have the right to exclude competitors "without constraint." By selecting who gets to play in the market, "Microsoft wants to make those choices for the consumer," he said

But a ruling in favor of Microsoft would have implications far beyond the current case, said Ted Henneberry, a lawyer in Heller Ehrman's London and Washington, D.C. offices and a former member of the Irish competition authority.

"There is an issue as to what the Commission's abilities are to restructure markets," he said. "This will set the bounds" for how aggressive the EC can be in regulating technology companies.

It's a question that applies to many more companies than just Microsoft.

In July, EU regulators charged Intel Corp. with monopoly abuse for allegedly offering customer rebates and below-cost pricing. They said Intel's actions undercut smaller rival computer chip-maker Advanced Micro Devices Inc.

Last month, the Commission charged Rambus Inc. with antitrust abuse, alleging the memory chip designer demanded "unreasonable" royalties for its patents that it said were fraudulently set as industry standards.

And it's also pondering further moves on Microsoft and its new Windows Vista operating system as well as investigating complaints about Qualcomm Inc.'s licensing fees for cell phone chip patents.

Ultimately, though, Microsoft isn't the same company it was in the 1990s, said Matt Rosoff of independent consultancy Directions on Microsoft. Today, it's an aging octopus struggling to match Google Inc. on Internet search and Apple Inc. on music players.

"Microsoft is not perceived as the all-powerful giant it was ten years ago," he said. "It's a combination of rapid change in the technology industry, the natural life cycle of any company growing and maturing."

___

AP Technology Writer Jessica Mintz in Seattle and Christopher S. Rugaber in Washington contributed to this report.

Beijing police launch Web patrols 59 minutes ago

Beijing police launch Web patrols 59 minutes ago



BEIJING - Police in China's capital said Tuesday they will start patrolling the Web using animated beat officers that pop up on a user's browser and walk, bike or drive across the screen warning them to stay away from illegal Internet content.

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Starting Sept. 1, the cartoon alerts will appear every half hour on 13 of China's top portals, including Sohu and Sina, and by the end of the year will appear on all Web sites registered with Beijing servers, the Beijing Public Security Ministry said in a statement.

China stringently polices the Internet for material and content that the ruling Communist Party finds politically or morally threatening. Despite the controls, nudity, profanity, illegal gambling and pirated music, books and film have proliferated on Chinese Internet servers.

The animated police appeared designed to startle Web surfers and remind them that authorities closely monitor Web activity. However, the statement did not say whether there were plans to boost monitoring further.

The male and female cartoon officers, designed for the ministry by Sohu, will offer a text warning to surfers to abide by the law and tips on Internet security as they move across the screen in a virtual car, motorcycle or on foot, it said.

If Internet users need police help they can click on the cartoon images and will be redirected to the authority's Web site, it said.

"We will continue to promote new images of the virtual police and update our Internet security tips in an effort to make the image of the virtual police more user friendly and more in tune with how web surfers use the Internet," it said.

China has the world's second-largest population of Internet users, with 137 million people online, and is on track to surpass the United States as the largest online population in two years.

The government routinely blocks surfers from accessing overseas sites and closes down domestic Web sites deemed obscene or subversive.

YouTube videos to have 'overlay' ads By ANICK JESDANUN, AP Internet Writer

YouTube videos to have 'overlay' ads By ANICK JESDANUN, AP Internet Writer
1 hour, 27 minutes ago



NEW YORK - Video advertising is coming to YouTube, but it won't be the type common at sites elsewhere. Starting Wednesday, the popular video-sharing site plans to feature semitransparent "overlay" ads at the bottom of selected video clips.

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The ad disappears after about 10 seconds if the viewer does nothing; the featured clip automatically pauses if the viewer clicks on the overlay to launch the full pitch.

YouTube said it was trying to avoid pre-rolls that precede the main feature at sites like Microsoft Corp.'s MSN, which partners with The Associated Press on a video news service.

Shiva Rajaraman, product manager for YouTube, said internal tests show more than 70 percent of people give up when they see a pre-roll. By contrast, less than 10 percent decide to close an overlay, which they can exit by clicking on an "X" in a corner.

The overlay format also gives advertisers more flexibility, he said, because they aren't constrained to keeping a video ad at 15 or 30 seconds to avoid defection. Because a viewer chooses to watch, a video ad can run much longer — clicking on one pre-launch overlay launched a 2-minute trailer for "The Simpsons Movie."

YouTube, which Google Inc. bought last year for $1.76 billion, is still trying to justify its hefty sales price. Despite its huge audience, YouTube generated about $15 million in revenue last year, based on figures provided in Google's annual report.

The site already has been showing display ads, but video ads look to be far more lucrative, particularly as they attract brand-name advertisers already used to buying video spots on television.

Initial video advertisers on YouTube include Warner Music Group Corp., News Corp.'s 20th Century Fox and Time Warner Inc.'s New Line Cinema. They will accompany video clips from selected partners, including Warner Music, the band Killswitch Engage and dozens of heavy video contributors accepted into a user-partner program.

Marketers can target their ads by user demographics, location, time of day or genre, such as music videos or sports. They won't be able to buy ads by keywords, though, the way Google allows merchants to purchase text ads triggered by a user's search terms.

And unlike Google's pay-per-click search ads, advertisers will be charged by eyeball — $20 per thousand viewers — regardless of whether the user clicks on the overlay.

Revenues will be split with the video owner, although officials won't say how. The video owner can decline all ads or selected ones, such as those from competitors.

Despite differences with Google's keyword ads, which generate the bulk of the company's revenues, officials said the two share a common goal of being nonintrusive.

"Ads need to provide value to the user community," said Eileen Naughton, Google's director of media platforms. "We've proved over and over again on Google that ads are really useful information when users raise their hands and engage with them."

Navy pulls YouTube video made by airman 18 minutes ago

Navy pulls YouTube video made by airman 18 minutes ago



SAN DIEGO - The Navy has removed a video from YouTube shot aboard the aircraft carrier Ronald Reagan because it shows sailors using safety equipment inappropriately, a Navy spokesman said.

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The video, titled "Women of CVN76: 'That Don't Impress Me Much,'" was shot by an airman and not sanctioned by the ship's commanders or the Navy. It includes fleeting shots of the door to the ship's nuclear power plant and of a sailor dancing while wearing a full-body radiation suit.

Both could alarm Navy nuclear-propulsion officials, who are sensitive about security. Under Pentagon rules, images of any part of a ship's nuclear plant cannot be shown to foreign nationals.

Nothing in the video — which was posted May 23 — compromised operational security, but officials were worried about the "lack of propriety" involving the safety equipment, said Lt. Cmdr. Charlie Brown, a spokesman for the San Diego-based Naval Air Forces command.

Navy commanders have counseled the airman who produced it, said Brown.

Set to a tune by country singer Shania Twain, the theme is that women serving aboard the Reagan can do the same jobs as men. Until 1994, the Pentagon barred women from serving on combat ships.

"The video was a lighthearted and positive depiction of the service of women officers and sailors aboard aircraft carriers and in Navy squadrons," Brown said.

Computer glitch causes delays at LAX By AMANDA BECK, Associated Press Writer

Computer glitch causes delays at LAX By AMANDA BECK, Associated Press Writer
1 hour, 43 minutes ago



LOS ANGELES - Weary international passengers were stuck at Los Angeles International Airport for several hours, unable to set foot in the United States after a computer failure prevented customs officials from screening arrivals.

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About 6,000 international passengers, both Americans and foreigners, sat in four airport terminals and in 40 planes starting about 1:30 p.m. on Saturday, when the computer system broke down, said Los Angeles World Airports spokesman Paul Haney.

The system contains names of arriving passengers and law enforcement data about them, including arrest warrants, said Mike Fleming, a U.S. Customs and Border Protection spokesman.

"That system allows our officers to make decisions on who we can allow to enter the United States," Fleming said. "You just don't know by looking at them."

Some of the computers were functioning by 7:45 p.m., and authorities began processing passengers in order of their arrival.

However, the system was functioning at reduced capacity, and officials did not know how long it would take to clear the huge backlog.

The cause of the shutdown was not known, and there was no estimate on when the system would be repaired, Fleming said.

Officials diverted seven incoming flights to an Ontario airport and advised international passengers departing Sunday to check the status of their flights before leaving for the airport.

Terminals that normally accept international passengers were full by 2:30 p.m. Saturday, and passengers arriving afterward had to remain on the runway until their was room inside the terminal buildings.

"This is just unbearable," said Gaynelle Jones, 57, who landed on a 13-hour flight from Hong Kong at about 2:15 p.m. and was still sitting on her plane five hours later. She said she had missed her connecting flight to Houston.

"We've already been on a plane for several hours, and they have no timeframe for when we'll be able to get off," Jones said during a cell phone interview.

Airport officials said the stranded planes were connected to ground power and passengers had access to food, water and bathrooms.

"People are getting a little stir-crazy, feeling claustrophobic," said Chris Cognac, 39, who was returning with family and friends — including 10 children — from a week in Puerto Vallarta. The group had been sitting on the tarmac for five hours when he spoke by phone.

Passengers on his plane were in the aisles, holding their carry-on luggage, and ready to disembark when the flight crew asked them to return to their seats, Cognac said.

"Everybody's pretty angry with customs at the moment because they're not informing any one of anything," Cognac said. "It's becoming a logistical issue with diapers."

AT&T errs in edit of anti-Bush lyrics By MICHELLE ROBERTS, Associated Press Writer

AT&T errs in edit of anti-Bush lyrics By MICHELLE ROBERTS, Associated Press Writer
2 hours, 42 minutes ago



SAN ANTONIO - Lyrics performed by Pearl Jam criticizing President Bush should not have been censored from a webcast by AT&T Inc., a company spokesman acknowledged Thursday.

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AT&T, through its Blue Room entertainment site, offered a webcast of the band's headlining performance Sunday at Lollapalooza in Chicago. The event was shown with a brief delay so the company could bleep out excessive profanity or nudity.

But monitors hired by AT&T through a vendor went further and cut two lines from a song to the tune of Pink Floyd's "Another Brick in the Wall." One was "George Bush, leave this world alone" the second time it was sung, and the other was "George Bush find yourself another home," according to the band's Web site.

AT&T spokesman Michael Coe said that the silencing was a mistake and that the company was working with the vendor that produces the webcasts to avoid future misunderstandings. He said AT&T was working to secure the rights to post the entire song — part of a sing-along with the audience — on the Blue Room site.

Blue Room offers live concerts, sports interviews, video game advice and other entertainment content that requires a high-speed Internet connection. Although viewing the content is free, San Antonio-based AT&T uses the site as a way to promote its DSL broadband services.

Besides Pearl Jam's show, AT&T showed 21 other performances ranging from Pete Yorn to G. Love and Special Sauce during the three-day Lollapalooza music festival. Coe said no other complaints have been made about censoring.

Pearl Jam said in a posting on its Web site that in the future, it would work harder to ensure live broadcasts or webcasts are "free from arbitrary edits."

"If a company that is controlling a webcast is cutting out bits of our performance — not based on laws, but on their own preferences and interpretations — fans have little choice but to watch the censored version," they said.

The alternative rock band and Internet advocates were also using the incident to try to draw attention to the prospects of Internet service providers like AT&T deciding to give preferential treatment to content they favor or have deals with, leaving the rest on slower-moving Internet bandwidths.

Jenny Toomey, executive director of the Future of Music Coalition, said that although net neutrality wasn't being violated in this case, it still raises questions about whether AT&T and other service providers can be trusted not to hurt artists.

Internet speeds that depend only on the size of files, not the kind of content that's in them, is a democratizing force, she said.

"We've got to protect that, and artists get that," Toomey said.

AT&T and other providers would like the ability to charge more for transmitting certain kinds of data, like live video, faster or more reliably than other data but have insisted such premium services would help, not hurt, consumers.

Coe said, regardless, the issue of net neutrality is entirely separate from the mistake during the Pearl Jam show.

"This was our own Web site," he noted.

___

On the Net:

Edited Webcast as posted on YouTube by the Future of Music Coalition:

http://tinyurl.com/37wst3

AT&T Blue Room: http://attblueroom.com

Pearl Jam: http://pearljam.com

AT&T errs in edit of anti-Bush lyrics By MICHELLE ROBERTS, Associated Press Writer

AT&T errs in edit of anti-Bush lyrics By MICHELLE ROBERTS, Associated Press Writer
2 hours, 27 minutes ago



SAN ANTONIO - Lyrics performed by Pearl Jam criticizing President Bush should not have been censored from a webcast by AT&T Inc., a company spokesman acknowledged Thursday.

ADVERTISEMENT

AT&T, through its Blue Room entertainment site, offered a webcast of the band's headlining performance Sunday at Lollapalooza in Chicago. The event was shown with a brief delay so the company could bleep out excessive profanity or nudity.

But monitors hired by AT&T through a vendor went further and cut two lines from a song to the tune of Pink Floyd's "Another Brick in the Wall." One was "George Bush, leave this world alone" the second time it was sung, and the other was "George Bush find yourself another home," according to the band's Web site.

AT&T spokesman Michael Coe said that the silencing was a mistake and that the company was working with the vendor that produces the webcasts to avoid future misunderstandings. He said AT&T was working to secure the rights to post the entire song — part of a sing-along with the audience — on the Blue Room site.

Blue Room offers live concerts, sports interviews, video game advice and other entertainment content that requires a high-speed Internet connection. Although viewing the content is free, San Antonio-based AT&T uses the site as a way to promote its DSL broadband services.

Besides Pearl Jam's show, AT&T showed 21 other performances ranging from Pete Yorn to G. Love and Special Sauce during the three-day Lollapalooza music festival. Coe said no other complaints have been made about censoring.

Pearl Jam said in a posting on its Web site that in the future, it would work harder to ensure live broadcasts or webcasts are "free from arbitrary edits."

"If a company that is controlling a webcast is cutting out bits of our performance — not based on laws, but on their own preferences and interpretations — fans have little choice but to watch the censored version," they said.

The alternative rock band and Internet advocates were also using the incident to try to draw attention to the prospects of Internet service providers like AT&T deciding to give preferential treatment to content they favor or have deals with, leaving the rest on slower-moving Internet bandwidths.

Jenny Toomey, executive director of the Future of Music Coalition, said that although net neutrality wasn't being violated in this case, it still raises questions about whether AT&T and other service providers can be trusted not to hurt artists.

Internet speeds that depend only on the size of files, not the kind of content that's in them, is a democratizing force, she said.

"We've got to protect that, and artists get that," Toomey said.

AT&T and other providers would like the ability to charge more for transmitting certain kinds of data, like live video, faster or more reliably than other data but have insisted such premium services would help, not hurt, consumers.

Coe said, regardless, the issue of net neutrality is entirely separate from the mistake during the Pearl Jam show.

"This was our own Web site," he noted.

___

On the Net:

Edited Webcast as posted on YouTube by the Future of Music Coalition:

http://tinyurl.com/37wst3

AT&T Blue Room: http://attblueroom.com

Pearl Jam: http://pearljam.com

Ark. airport fast lane will cost you By PEGGY HARRIS, Associated Press Writer

Ark. airport fast lane will cost you By PEGGY HARRIS, Associated Press Writer
51 minutes ago



LITTLE ROCK - A traveler's speed of passage through security at Little Rock National Airport could soon depend not on how many other people are in line, but on whether they paid an extra hundred bucks beforehand.

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New York-based Verified Identity Pass began enrolling travelers Wednesday in its Clear program, which provides a card they can use to get through the line faster.

For the privilege, cardholders must provide two forms of government identification, their fingerprints and iris prints, pass a federal security check and pay $99.95.

The fee is good for a year. But for federal, state and local government workers, it is good for 13 months.

Verified Identity Pass began its Clear program two years ago at the Orlando, Fla., airport and has been adding enrollment centers at airports around the country at a brisk pace.

The company has kiosks at John F. Kennedy International Airport in New York and airports in Albany, N.Y., Cincinnati, Indianapolis, Newark, N.J., and San Jose, Calif. Its cards also are recognized at the Reno, Nev., airport, where competitor Unisys operates a similar service.

Chairman and chief executive Steven Brill said the cards have cut the time in line at the Orlando airport by about 30 minutes. For the typical cardholders — business people and other frequent flyers — the time savings is more than just convenience.

Wednesday, Randy Wolf had heard of the program and made the trip to the Little Rock airport specifically to enroll on opening day. Wolf works in Little Rock for Balcones Fuel Technology but lives in Dallas.

"I travel 50 weeks out of the year and anything I can do to shave off the amount of time I can spend in an airport to me is personally and financially a plus," Wolf said.

While the time to get from the parking lot to an airplane in Little Rock sometimes takes only five minutes, he said, the process at other airports is painfully long.

"Places like Orlando can be a nightmare," Wolf said.

The Little Rock airport has about 1.3 million passengers a year who board planes, said airport executive director Deborah Schwartz. Verified Identity Pass has a concessionaire-type relationship with the airport and its service accommodates travelers without jeopardizing security, she said.

To obtain a card, applicants can begin the process online at http://www.flyclear.com. Next, they must bring two forms of government identification, including one with a photo, to a Clear enrollment center at an airport or major business that has a Clear kiosk.

At the enrollment center, applicants receive an account number and get their fingerprints and iris prints taken. The company sends the information to the U.S. Transportation Security Administration, which conducts the background check. If the applicant passes, the card arrives to them in the mail. The process takes two to four weeks.

At the airport, the cardholder still has to go through check in, baggage and security checks. But cardholders pass through a special lane operated by Clear employees who give them the OK to go to the front of the airport security line.

Virgin America enters airline fray By JOHN WILEN, AP Business Writer

Virgin America enters airline fray By JOHN WILEN, AP Business Writer
48 minutes ago



NEW YORK - Just as major airlines are beginning to return to profitability after cutting capacity to lower costs and boost profits, Virgin America entered the fray.

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Virgin America's inaugural flights began Wednesday linking its San Francisco hub with New York's John F. Kennedy International Airport and Los Angeles. They which could mark the beginning of stiffer price competition.

The new carrier got a taste of the challenges other airlines face when its first flight out of Kennedy Airport was delayed due to the severe storms that hit New York Wednesday morning. Airport officials said the storms caused flight delays of up to an hour and a half and much worse ground delays.

Virgin America's scheduled 10 a.m. flight lifted off about 10:50 a.m., said spokesman Gareth Edmonson-Jones. Onboard were billionaire Richard Branson and Chief Executive Fred Reid, who was late arriving at the airport.

Comedian Stephen Colbert, scheduled to attend a ceremony at the airport, didn't make it.

"He was in a car for 4 1/2 hours and turned around in the end," Edmonson-Jones said.

The New York flight and one from Los Angeles landed seconds apart at San Francisco International Airport to cheers from hundreds of Virgin America employees and other spectators at the highly coordinated arrival. Fire trucks sprayed the planes with water cannons, and at the terminal, Branson waved a giant American flag as he and Reid hung out the cockpit windows.

"Everyone knows the quality of service of the big carriers in America has always been rather sad," Branson said later after a news conference with San Francisco Mayor Gavin Newsom. "The carriers have never cared about their passengers, never given their staff the tools they need, never entertained their passengers, and they keep going bankrupt, going into Chapter 11. The industry needs new blood, it needs Virgin America."

The airline, a brainchild of Branson, plans to add direct New York to Los Angeles flights beginning Aug. 29 and more routes later this year, including service between Washington's Dulles International Airport and the West Coast. It will also fly into Las Vegas.

Virgin America is offering round trip fares of $278 between New York and the West Coast. First-class round trips start at $778. Some airlines, including JetBlue Airways Corp., have already been forced to match Virgin America's economy fares, while other airlines are offering even cheaper fares.

"(The) last thing needed now is another airline," said Ray Neidl, an analyst at Calyon Securities. "(It) will have a negative effect on pricing."

Others say the relatively small number of transcontinental and California routes Virgin America will serve are already highly competitive and in such demand that a few new daily flights will hardly dent other airlines.

Virgin America's 19 daily U.S. flights represent a minuscule percentage of the air system's 10.3 million annual departures.

"If you're going to start an airline, right now may be the best time — everybody's full and there's limited ability to competitively respond," said Mike Boyd, a consultant whose firm, The Boyd Group, is based in Evergreen, Colo. "I don't think it'll hurt anybody."

Most at risk from Virgin America's competition is JetBlue, the JFK-based low cost carrier from whose playbook Virgin America appears to be stealing a page with its trendy, plush styling and free in-flight television. Virgin America routes overlap about 10 percent of JetBlue's network, said airline consultant Robert Mann, of R.W. Mann & Co. in Port Washington, N.Y.

JP Morgan Securities analyst Jamie Baker estimates as much as $220 million of JetBlue's annual revenue, or about 9 percent of its $2.4 billion in annual sales, is at risk from Virgin America.

JetBlue spokesman Bryan Baldwin said the majority of JetBlue's business is flying people from the Northeast to Florida — routes Virgin America has no announced plans to enter.

Neither JetBlue nor Virgin America offer the lowest fare on their shared routes. Northwest Airlines Corp. and ATA Holdings Corp.'s ATA Airlines both offer slightly cheaper flights, according to Web travel site Sidestep.com.

Other airlines facing new competition from Virgin America include UAL Corp.'s United Airlines and AMR Corp.'s American Airlines, both of which have more revenue at risk in northern California, Baker says.

The added flights could increase congestion at airports in New York and California that are already experiencing one of the worst summers ever in terms of flight delays and cancellations. But the additional seats might be welcomed by passengers stranded by delays and cancellations because other carriers are sold out.

Airline passengers increased by 0.3 percent in the year ended in April, even though overall airline departures fell by 1.5 percent, according to the Bureau of Transportation Statistics.

___

AP Business Writer Jordan Robertson in San Francisco contributed to this report.

Study finds Pacific coral reefs dying By MICHAEL CASEY, AP Environmental Writer

Study finds Pacific coral reefs dying By MICHAEL CASEY, AP Environmental Writer
47 minutes ago



BANGKOK, Thailand - Coral reefs in much of the Pacific Ocean are dying faster than previously thought, according to a study released Wednesday, with the decline driven by climate change, disease and coastal development.

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Researchers from the University of North Carolina in Chapel Hill found that coral coverage in the Indo-Pacific — an area stretching from Indonesia's Sumatra island to French Polynesia — dropped 20 percent in the past two decades.

About 600 square miles of reefs have disappeared since the 1960s, the study found, and the losses were just as bad in Australia's well-protected Great Barrier Reef as they were in poorly managed marine reserves in the Philippines.

"We found the loss of reef building corals was much more widespread and severe than previously thought," said John Bruno, who conducted the study along with Elizabeth Selig. "Even the best managed reefs in the Indo-Pacific suffered significant coral loss over the past 20 years."

The study, which examined 6,000 surveys of more than 2,600 Indo-Pacific coral reefs done between 1968 and 2004, found the declines began earlier than previously estimated and mirror global trends. The United Nations has found close to a third of the world's corals have disappeared, and 60 percent are expected to be lost by 2030.

The Indo-Pacific contains 75 percent of the world's coral reefs and provide a home for a wide range of marine plants and animals. They provide shelter for island communities and are key source of income, mostly from the benefits of fishing and tourism.

"Indo-Pacific reefs have played an important economic and cultural role in the region for hundreds of years and their continued decline could mean the loss of millions of dollars in fisheries and tourism," Selig said in a statement. "It's like when everything in the forest is gone except for little twigs."

While the study didn't examine the cause of the decline, Bruno said he believed it was driven by a range of factors including warming waters due to climate change. He also blamed storm damage, runoff from agriculture and industry, predators like fast-spreading crown-of-thorn starfish and diseases like White syndrome.

Bruno said the study demonstrated the need to better manage reefs and prevent threats such as overfishing, but acknowledged local measures would have little impact without a reduction of greenhouse gases.

"It is just one more example of the striking, far reaching effects of climate change and our behavior," Bruno said of the link between climate change and reef destruction. "It is the folks in North Carolina driving their SUVs. It is their behavior that is having an effect way out in the Indo-Pacific."

Ove Hoegh-Guldberg, director of the Center for Marine Studies at The University of Queensland in Australia, said the study should put to rest any suggestion that reefs like the Great Barrier Reef are untouched by "human pressures."

"This is a solid study that produces mounds of evidence that suggests reefs are changing counter to the untested and ungrounded claims that it isn't happening," Hoegh-Guldberg, who was not involved in the study, said in an e-mail interview."

____ On the Net:

Bruno's homepage: http://www.unc.edu/brunoj

Vonage subscriber recruitment stalls By PETER SVENSSON, AP Technology Writer

Vonage subscriber recruitment stalls By PETER SVENSSON, AP Technology Writer
Thu Aug 9, 8:31 AM ET



NEW YORK - Internet telephone company Vonage Holdings Corp. on Thursday reported a much reduced loss for the second quarter as it scaled back marketing, but it also saw a drastic drop in new subscribers.

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The drop in recruitment means that Vonage is no longer the country's largest provider of Internet-based telephone service, a field it pioneered. Cable company Comcast Corp. reported 3 million digital phone subscribers at the end of the second quarter, surpassing Vonage's 2.45 million, an increase of just 57,000 lines from the first quarter.

The Holmdel, N.J., company is struggling in court with another old-line telecommunications company, Verizon Communications Inc. In March, a jury found that Vonage infringed on three Verizon patents. The judge barred Vonage from signing up new customers, but that decision has been stayed while an appeals court considers it. In the mean time, Vonage is trying to work around the patented technologies.

Vonage posted a net loss of $34 million, or 22 cents per share, for the April-June period, down from $74 million, or $1.16 per share, in the same period last year.

Excluding one-time charges, Vonage lost $18 million, or 12 cents a share, substantially better than the average analyst estimate compiled by Thomson Financial at 34 cents a share. Analyst estimates generally exclude charges.

Revenue came to $206 million, $2 million short of analyst expectations but up 43 percent from $144 million in the second quarter of 2006.

Vonage, which once blanketed the Internet with its banner ads, spent $68 million on marketing in the second quarter, down from $91 million in the first quarter. However, it got less for its money: the market costing per added subscriber rose by $14 to $287.

Vonage's interim chief executive, Jeffrey Citron, said a more focused marketing effort has reduced the cost to about $250 per subscriber in June and July, and the company expects that cost level to be sustained through the third quarter.

Rather than focusing on building the Vonage brand, Citron said, the company is now directing its money to where it's most likely to recruit subscribers. For instance, its Web ads are now only showing up on the "highest-performing" sites.

Citron also said he expects subscriber additions to rise in the third quarter as new marketing initiatives take hold.

"I believe we're turning the corner on one of the most difficult periods of Vonage's history," he said.

The business of selling Voice over Internet Protocol service, or VoIP, independently of cable and phone companies has looked increasingly shaky in recent months. Vonage's legal troubles have no doubt scared off some potential subscribers. In July, rival SunRocket abruptly shut down, stranding more than 200,000 subscribers.

On June 30, Vonage had cash reserves of $344 million, down from $410 million three months earlier. Of the total, $66 million were tied up as collateral for a bond tied to the Verizon patent verdict. The company said it expected its "cash burn" to decline in the third quarter.

___

On the Net:

Vonage Holdings Corp.: http://www.vonage.com

Army denounces 3 articles written by GI By JOHN MILBURN and ELLEN SIMON, Associated Press Writers

Army denounces 3 articles written by GI By JOHN MILBURN and ELLEN SIMON, Associated Press Writers
1 hour, 11 minutes ago



NEW YORK - A magazine gets a hot story straight from a soldier in Iraq and publishes his writing, complete with gory details, under a pseudonym. The stories are chilling: An Iraqi boy befriends American troops and later has his tongue cut out by insurgents. Soldiers mock a disfigured woman sitting near them in a dining hall. As a diversion, soldiers run over dogs with armored personnel carriers. Compelling stuff, and, according to the Army, not true.

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Three articles by the soldier have run since January in The New Republic, a liberal magazine with a small circulation owned by Canadian company CanWest Corp. The stories, which ran under the name "Scott Thomas," were called into question by The Weekly Standard, a conservative magazine with a small circulation owned by Rupert Murdoch's News Corp. The Standard last month challenged bloggers to check the dispatches.

Since then, Pvt. Scott Thomas Beauchamp, of the 1st Battalion, 18th Infantry, has come forward as the author. The New Republic said that Beauchamp "came to its attention" through Elspeth Reeve, a reporter-researcher at the magazine he later married.

The Army said this week it had concluded an investigation of Beauchamp's claims and found them false.

"During that investigation, all the soldiers from his unit refuted all claims that Pvt. Beauchamp made in his blog," Sgt. 1st Class Robert Timmons, a spokesman in Baghdad for the 4th Brigade, 1st Infantry Division, based at Fort Riley, Kan., said in an e-mail interview.

The Weekly Standard said Beauchamp signed a sworn statement admitting all three articles were exaggerations and falsehoods.

Calls to Editor Franklin Foer at The New Republic in Washington were not returned, but the magazine said on its Web site that it has conducted its own investigation and stands by Beauchamp's work.

In its note posted Aug. 2, it said, "We checked the plausibility of details with experts, contacted a corroborating witness, and pressed the author for further details. But publishing a first-person essay from a war zone requires a measure of faith in the writer. Given what we knew of Beauchamp, personally and professionally, we credited his report."

After the pieces were questioned, the magazine said it extensively re-reported his account, contacting dozens of people, including former soldiers, forensic experts, war reporters and Army public affairs officers.

The New Republic said it also spoke to five members of Beauchamp's company, all of whom corroborated Beauchamp's anecdotes but requested anonymity.

In the note, the magazine said the incident with the disfigured woman took place in Kuwait, not Iraq. The magazine also said the Army took away Beauchamp's mobile phone and his computer and he "is currently unable to speak to even his family."

The Associated Press has been unable to reach Beauchamp, and the Army said details of the investigation were not expected to be released. "Personnel matters are handled internally; they are not discussed publicly," said Lt. Col. Joseph M. Yoswa, an Army spokesman.

Bob Steele, the Nelson Poynter Scholar for Journalism Values at The Poynter Institute school for journalists in St. Petersburg, Fla., said granting a writer anonymity "raises questions about authenticity and legitimacy."

"Anonymity allows an individual to make accusations against others with impunity," Steele said. "In this case, the anonymous diarist was accusing other soldiers of various levels of wrongdoing that were, at the least, moral failures, if not violations of military conduct. The anonymity further allows the writer to sidestep essential accountability that would exist, were he identified."

Steele said he was troubled by the fact that the magazine did not catch the scene-shifting from Kuwait to Iraq of the incident Beauchamp described involving the disfigured woman.

"If they were doing any kind of fact-checking, with multiple sources, that error — or potential deception — would have emerged," Steele said.

He added that he was also troubled by the relationship between Beauchamp and Reeve, his wife, who works at The New Republic. "It raises the possible specter of competing loyalties, which could undermine the credibility of the journalism," he said.

Paul McLeary, a staff writer for Columbia Journalism Review who has written about the matter, said The New Republic failed to do some basic journalistic legwork, such as calling the public affairs officer for Beauchamp's unit.

"There is a degree of trust and faith editors have to put in their writers," McLeary said. "If you're on a tight deadline, you have to go as far as you can. The New Republic definitely didn't go as far as it could in terms of checking out its stories."

This isn't the first time New Republic's credibility has been called into question.

In 1998, the magazine fired Stephen Glass after reports surfaced that he had enhanced a story about computer hackers. Editors at the magazine researched his work and said they found fabrications in 27 of the 41 articles he had written for the publication over three years.

___

Milburn reported from Topeka, Kan.

Blockbuster to buy movie download firm By GARY GENTILE, AP Business Writer

Blockbuster to buy movie download firm By GARY GENTILE, AP Business Writer
2 hours, 27 minutes ago



DALLAS - Although Blockbuster Inc.'s Total Access program has been adding subscribers faster than Netflix Inc.'s DVD rental service, Netflix was able to tout that only it offered the ability to instantly download movies and TV shows to a computer. Not for long. Blockbuster said Wednesday it is buying the digital movie-download service Movielink, giving it a stronger online foothold to compete with its rival.

The Dallas-based video rental chain said it would continue to operate Movielink as a stand-alone service but eventually make elements of it available through Blockbuster's online-ordering, mail-delivery service.

Terms of the deal were not disclosed.

Blockbuster was in advanced talks to buy Movielink earlier this year but backed off. The chain renewed the talks in July, about the time that it named a new chief executive, James Keyes.

"Many of our stores still say 'Blockbuster Video,'" Keyes said in an interview. "We're taking a fresh look at the future of Blockbuster. The popularity of (online rentals) convinced us that customers are ready for more convenient forms of digital delivery that we think Blockbuster can successfully enter."

The deal gives Blockbuster access to Movielink's large catalog and, for the first time, gives its customers the ability to download movies.

Netflix, which has more subscribers but isn't growing as fast, has been offering a download service since early this year.

Both services face limits, however. Netflix's catalog is mostly older movies, although it recently began offering current television shows such as NBC's "The Office."

Movielink "puts us in business," Keyes said, "but longer-term we must have faster and more effective streaming capability" and consumer-friendly features.

Keyes added that Blockbuster could make additional acquisitions in the download business.

Movielink, based in Santa Monica, Calif., was launched by five studios in 2002, marking the first time that a large supply of recent, popular films was available for rental on the Internet.

The studios hoped to stave off enormous losses from people downloading illegal copies of movies over the Internet. The company is owned equally by Sony Pictures Entertainment, Universal Studios, Paramount Pictures, Metro-Goldwyn-Mayer and Warner Bros.

Movielink has struggled to gain popularity, even as it allowed the purchase of films and signed licensing agreements with all major studios and a large number of independent film companies.

Blockbuster and Movielink were in serious talks in February for a deal with a price that people familiar with the situation said then was less than $50 million in cash and stock.

Keyes said Wednesday that the final terms "are substantially different than our previous discussion," and that Blockbuster agreed to pay in cash, but he declined to describe the terms beyond that.

Blockbuster considers Movielink "a first step" toward making movie downloads available to computers, televisions and even portable devices such as cell phones, Keyes said.

Blockbuster's Total Access service, which allows customers to select DVD rentals online and receive them through the mail, has about 3.6 million subscribers. Netflix has 6.7 million subscribers.

Blockbuster added 600,000 subscribers in the second quarter, while Netflix lost 55,000 — its first quarterly decline since the service began in 1999.

Netflix spokesman Steve Swasey said the company lets customers download about 4,000 movie and TV titles directly to a personal computer, and that customers have used the service 5 million times.

___

AP Business Writer Gary Gentile in Los Angeles contributed to this report.

'Green' tech shops have a way to go By BRIAN BERGSTEIN, AP Technology Writer

'Green' tech shops have a way to go By BRIAN BERGSTEIN, AP Technology Writer
2 hours, 54 minutes ago



The extremely air-conditioned computer farms known as data centers are the gas-guzzling jalopies of the technology world. Some require 40 or 50 times more power than comparably sized office space. So with energy costs high and environmental friendliness making for good public relations, more tech companies are touting ways they are "greening" data centers, which serve up Web pages, swap Internet traffic, and process and store business information.

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But it's a lot easier to put out a news release than to build a data center with a significantly smaller environmental footprint. Even as efficiency improvements are reducing the energy gulped by many kinds of hardware, the industry's overall electricity consumption could double from 2006 to 2011 as demand grows.

"It's somewhat analogous to someone who decides to purchase an energy-efficient automobile and says, `Gee, I'm using 30 percent less gasoline with this, that means I can drive 30 percent more miles than I used to, and still do something for the environment,'" said Charles King, an analyst with Pund-IT Research. "It's an interesting philosophical question."

A new report from the Environmental Protection Agency estimates that the easiest, least inexpensive changes to data center operations — involving tweaks to software, layout and air conditioning — could boost efficiency by 20 percent.

But even that level of improvement would still lead to higher overall electric use in the coming years. Going further, and actually reducing information-technology's strain on the electric grid, will require a more aggressive commitment. The EPA says 45 percent improvement — enough to lower electricity usage by 2011 — can be achieved with existing technologies.)

To understand the scope of the problem, it helps to grasp why data centers are so power hungry.

Depending on the configuration and the equipment involved, as little as 30 to 40 percent of the juice flowing into a data center is used to run computers. Most of the rest goes to keeping the hardware cool, since heat saps performance.

Unlike in other office space, that A/C cranks year-round, to overcome the 100-degree-plus air that the computers themselves throw off. That challenge has increased in recent years with the rise of compact "blade" servers that are crammed into server racks.

This is why big data centers can devour several megawatts of power, enough for a small city.

Neil Rasmussen, chief technical officer of data center equipment supplier American Power Conversion Corp., calculates that even a 1 megawatt data center will ring up $17 million in electric bills over its 10-year life span. Even so, few data centers have taken obvious steps to reduce that load.

"I don't know too many people who have really tackled this and pushed things to the limit with what we already have," said Mark Bramfitt, a program manager for Pacific Gas & Electric Co., a California utility that has offered cash incentives for data centers to reduce their energy bills — and found relatively few takers. "We've got a whole lot of room for improvement."

For example, almost all the energy that goes into the air conditioning systems is used to run giant chillers that make the air pumped through the rooms' raised floors a brisk 55 degrees or so, sometimes as low as the 40s. Such extremely cold air is blasted in to guarantee that no single server's temperature gets much above the optimum level, which is around 70 degrees.

But the A/C doesn't have to be so cold if the layout of server rooms is better designed to improve air flow, smoothing out all the various microclimates that can develop.

And in many places, the outside air is plenty cold enough much of the year, for free. Yet only recently have data centers adopted systems that can take filtered outside air for cooling the computer rooms.

To be fair, some data centers are buried too deep within buildings to gulp fresh air. But the main reason for the A/C over-reliance is that data centers were built for one thing — to maximize the performance of the Web sites, computer programs and networking equipment that they run. If the air conditioning is colder than necessary, so be it.

"There are probably two key metrics for the IT guy: no downtime — if the boss' e-mail doesn't work, he hears about it right away — and `no security breaches on my watch,'" says Eric Birch, executive vice president of Degree Controls Inc., which sells a system that increases electronics cooling efficiency. "They normally do not know, don't care and aren't measured by their electric bill."

In fact, in many companies, any given department's responsibility for the overall utility bill is determined by such factors as employee head count or square feet of office space. By that measure, the IT department comes out way ahead.

Steve Sams, a vice president for data-center services at IBM Corp., estimates this is still the state of affairs 70 to 80 percent of the time. The tech shops "aren't actually paying their real energy bill," Sams says. "What it shows me is how immature we are in this area as an industry."

Not until recently have the industry's concerns about the issue crystallized. Chip manufacturers such as Intel Corp. and Advanced Micro Devices Inc. have ratcheted up the electrical efficiency of their microprocessors — a metric that no one cared about until the past few years. IBM and Hewlett-Packard Co. have invested in better ways to manage cooling systems.

One data-center operator, Rackspace Inc., just announced a new facility in Slough, England, powered by renewable sources such as biomass. Some smaller providers have gone solar, including California-based Affordable Internet Services Online (AISO) Inc., which recently ran the Web infrastructure for the Live Earth concerts.

The "green" value in other steps is harder to discern.

One commonly talked-about effort involves virtualization, which lets one computer handle the functions of multiple machines at once. Rather than having dozens of servers operating at far less than their maximum level of utilization, data centers can use virtualization to consolidate those same machines' functions on just a few computers.

The result can be striking — in its solar-powered center, AISO uses virtualization to mimic the functions of 120 servers on just four machines — and clearly it saves electricity.

IBM claims it will save $250 million — partly in reduced power costs — by taking 16,000 internal servers out of action and shifting their work on 30 big mainframe computers. IBM also is using virtualization and better cooling technologies to expand the capacity of its largest data center, in Boulder, Colo., by nearly half, while leaving it with "the same energy footprint" as before, Sams says.

That's a solid step, to be sure. But it's fair to say the information-technology industry — which, after all, makes machines packed with toxic chemicals — will have to do much more to truly merit green credentials.

By consolidating servers and taking other steps to overhaul its internal computing setup, Sun Microsystems Inc. says it cut IT energy usage by a few percentage points in its last fiscal year — and expects to slice it by another 20 percent this year. Dave Douglas, Sun's vice president for eco-responsibility, says the company is still learning how to make deeper improvements.

"We view green as a destination, in which case we focus on what we have left to do," he says. "When we look at that, we say, geez, we're not really green yet. We're greener — but we're not green."

___

On the Net:

Consortium of IT companies on the environment:

http://www.greengrid.org

The recent EPA report can be found here:

http://tinyurl.com/2dldlx

IBM launches system to track medications By BARBARA ORTUTAY, AP Business Writer

IBM launches system to track medications By BARBARA ORTUTAY, AP Business Writer
2 hours, 49 minutes ago



NEW YORK - To help the pharmaceutical industry combat drug counterfeiting, IBM is launching an electronic pedigree system Thursday that tracks medications through the supply chain until they reach consumers.

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The system employs radio-frequency identification, or RFID tags, which are already used to track packages of drugs, especially ones popular with counterfeiters. Pfizer, for example, uses RFID chips to track packs of its erectile dysfunction drug Viagra, and Purdue Pharma LP has been using them since 2004 to track its pain reliever OxyContin.

IBM's ePedigree system helps drug companies create electronic certificates of authenticity for medications — down to the individual bottle — as they move from manufacturers and distributors to pharmacies and hospitals.

"The whole time, the system is watching what's happening, it records (the drug's) life history," said Chris Clauss, director of sensor information management at IBM Software.

While there is no guarantee that RFID tags will get rid of all counterfeits, he added, "what we can do is raise the bar," and make it substantially more difficult.

Drug companies' prior attempts at fighting fakes — such as holograms, watermarks and the like — were often reproduced within months, to the point where even their brand managers could not tell the difference between the counterfeit and the real thing.

IBM, which first worked with RFID more than 10 years ago, said its ePedigree system will help companies comply with a slew of new regulations, such as ones going into effect in California in 2009.

California's ePedigree law will require that any medication distributed in the state have its life history attached to it — starting at the drug manufacturer until it ends up in the pharmacy.

In recent years, much of the market has focused on the hardware of RFID — how the data is scanned and collected in the chips — said Michael Liard, research director of RFID and Contactless at ABI Research. IBM's ePedigree system, however, focuses on how that information is distributed along the supply chain.

The ePedigree system is useful not just for battling fakes, Clauss said, but for keeping track of expiration dates, batch numbers in case a drug is recalled, and so on.

International Business Machines Corp. is based in Armonk, N.Y.

Blockbuster to buy movie download firm By GARY GENTILE, AP Business Writer

Blockbuster to buy movie download firm By GARY GENTILE, AP Business Writer
2 hours, 21 minutes ago



DALLAS - Although Blockbuster Inc.'s Total Access program has been adding subscribers faster than Netflix Inc.'s DVD rental service, Netflix was able to tout that only it offered the ability to instantly download movies and TV shows to a computer. Not for long. Blockbuster said Wednesday it is buying the digital movie-download service Movielink, giving it a stronger online foothold to compete with its rival.

ADVERTISEMENT

The Dallas-based video rental chain said it would continue to operate Movielink as a stand-alone service but eventually make elements of it available through Blockbuster's online-ordering, mail-delivery service.

Terms of the deal were not disclosed.

Blockbuster was in advanced talks to buy Movielink earlier this year but backed off. The chain renewed the talks in July, about the time that it named a new chief executive, James Keyes.

"Many of our stores still say 'Blockbuster Video,'" Keyes said in an interview. "We're taking a fresh look at the future of Blockbuster. The popularity of (online rentals) convinced us that customers are ready for more convenient forms of digital delivery that we think Blockbuster can successfully enter."

The deal gives Blockbuster access to Movielink's large catalog and, for the first time, gives its customers the ability to download movies.

Netflix, which has more subscribers but isn't growing as fast, has been offering a download service since early this year.

Both services face limits, however. Netflix's catalog is mostly older movies, although it recently began offering current television shows such as NBC's "The Office."

Movielink "puts us in business," Keyes said, "but longer-term we must have faster and more effective streaming capability" and consumer-friendly features.

Keyes added that Blockbuster could make additional acquisitions in the download business.

Movielink, based in Santa Monica, Calif., was launched by five studios in 2002, marking the first time that a large supply of recent, popular films was available for rental on the Internet.

The studios hoped to stave off enormous losses from people downloading illegal copies of movies over the Internet. The company is owned equally by Sony Pictures Entertainment, Universal Studios, Paramount Pictures, Metro-Goldwyn-Mayer and Warner Bros.

Movielink has struggled to gain popularity, even as it allowed the purchase of films and signed licensing agreements with all major studios and a large number of independent film companies.

Blockbuster and Movielink were in serious talks in February for a deal with a price that people familiar with the situation said then was less than $50 million in cash and stock.

Keyes said Wednesday that the final terms "are substantially different than our previous discussion," and that Blockbuster agreed to pay in cash, but he declined to describe the terms beyond that.

Blockbuster considers Movielink "a first step" toward making movie downloads available to computers, televisions and even portable devices such as cell phones, Keyes said.

Blockbuster's Total Access service, which allows customers to select DVD rentals online and receive them through the mail, has about 3.6 million subscribers. Netflix has 6.7 million subscribers.

Blockbuster added 600,000 subscribers in the second quarter, while Netflix lost 55,000 — its first quarterly decline since the service began in 1999.

Netflix spokesman Steve Swasey said the company lets customers download about 4,000 movie and TV titles directly to a personal computer, and that customers have used the service 5 million times.

___

AP Business Writer Gary Gentile in Los Angeles contributed to this report.

SpiralFrog aims for end of year launch By ALEX VEIGA, AP Business Writer

SpiralFrog aims for end of year launch By ALEX VEIGA, AP Business Writer
56 minutes ago



LOS ANGELES - SpiralFrog.com, an ad-supported Web site that allows visitors to download music and videos free of charge, has begun testing its service with plans to launch by the end of the year.

The New York-based company recently began allowing an unspecified number of users in North America to try out the site, which has about 700,000 tracks available for downloading, said SpiralFrog founder and Chairman Joe Mohen.

The company plans to expand its "beta" test in the coming weeks and will launch the service in the United States and Canada after receiving feedback from users, advertisers and recording labels.

"We're really testing the user experience to make sure it satisfies the needs of demanding young consumers," Mohen said.

SpiralFrog lets users download audio tracks and music videos for free, but requires that they register and log on at least once a month to continue to play the content. Though free, the audio and video files carry copy protections like those found on tracks available for sale at Apple's iTunes Store and elsewhere.

It takes 90 seconds to download a track — more for a video. During that time users are enticed to browse the site and, its advertisers hope, become exposed to more ads.

"The consumer is paying for the music with some time," Mohen said.

Downloads cannot be burned to a CD, but can be transferred to dozens of digital music players. The content, however, is not compatible with Apple's Macintosh computers or its market-leading iPod.

SpiralFrog aroused interest last fall after it announced licensing deals with Vivendi SA's Universal Music Group, the world's largest recording company, and performing right organization Broadcast Music Inc. But the company missed its early 2007 launch and instead underwent an executive shuffle that ended with the ouster of then-CEO Robin Kent.

Mohen blamed the launch delay on the time-consuming process of obtaining rights from music publishers, who will be getting 10 percent of ad revenues, and the need to expand its data storage and bandwidth capabilities.

"With SpiralFrog we have an entirely new business model," Mohen said. "In most cases we have to clear the publishing rights ourselves, and that takes a long time."

Mohen said SpiralFrog continues to hold licensing talks with other labels and hopes to have a catalog of around 1.5 million tracks at launch.

___

On the Net:

SpiralFrog: http://www.spiralfrog.com

EMI releases kebab seller's single By JOHN LEICESTER, Associated Press Writer

EMI releases kebab seller's single By JOHN LEICESTER, Associated Press Writer
37 minutes ago



PARIS - Lil'Maaz's path to glory is coated with mutton grease.

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EMI, The Beatles' music distributor, released a debut single this week by the Turkish immigrant who sells kebabs in Paris. The story behind "Eat Kebab" ("Mange du Kebab") is as unlikely as they come and an example of how the Internet is shaking up the music business.

This is how EMI tells it.

Yilmaz Karaman — aka Lil'Maaz — moved to France in 2003 and got a job at an eatery. A cheerful chap, he composed a song about his work ("Eat kebab, eat kebab my friend!") to regale his regulars. Fortuitously for him, they included employees from a nearby recording studio, who invited Lil'Maaz to record his song.

A friend shot video of Lil'Maaz dancing and rapping in the restaurant, meat roasting on the spit in the background. Posted on a sharing site, Daily Motion, the video has drawn more than 435,000 views over the past month. That buzz interested EMI, which released the single in stores on Monday.

Lil'Maaz is not the first singer — but is surely among the most bizarre — to get a break via the Internet.

"Straight away, we thought it was great, funny," said Xavier Chevalier of EMI Marketing. "It's a bit of an Unidentified Flying Object ... It started as something that wasn't taken seriously."

Chevalier said that although it was still to early to tell how the single was selling, "on the Internet, it was a real tidal wave. Everyone shared the video."

"My head is spinning," Lil'Maaz, 27, said of his sudden success.

He said he was unsure whether he'll now quit his restaurant job. "I still have my love for kebabs," he said. "My goal was to have a laugh, and to make people laugh."

___

On the Net:

http://www.mangedukebab.com

Prototype Internet device fails FCC test 13 minutes ago

Prototype Internet device fails FCC test 13 minutes ago



WASHINGTON - The government gave a failing grade to a prototype device that Microsoft Corp., Google Inc., Dell Inc. and other technology companies said would beam high-speed Internet service over unused television airwaves.

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The Federal Communications Commission on July 31 said the devices submitted by the technology coalition could not reliably detect unused TV spectrum, and could also cause interference.

Despite the setback, FCC chairman Kevin Martin said Tuesday the agency still would like to find a way to transmit high-speed Internet service over the unused airwaves.

In a statement, the technology coalition — which also includes Hewlett-Packard Co., Intel Corp. and Philips Electronics North America Corp., a division of Netherlands-based Royal Philips Electronics NV — said it will work with the FCC to resolve any questions.

The technology companies say the unlicensed and unused TV airwaves, also known as "white spaces," would make Internet service accessible and affordable, especially in rural areas and also spur innovation.

However, TV broadcasters oppose usage of white spaces because they fear the device will cause interference with television programming and could cause problems with a federally mandated transition from analog to digital signals in February 2009.

Vodafone won't sell Verizon stake By JANE WARDELL, AP Business Writer

Vodafone won't sell Verizon stake By JANE WARDELL, AP Business Writer
57 minutes ago



LONDON - British mobile phone operator Vodafone Group PLC said Wednesday it has no plans to sell its stake in Verizon Wireless, attempting to end speculation about the future of its U.S. operations.

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Vodafone, the world's largest mobile phone company, said it had decided not to exercise its rights to sell the stake to Verizon Communications Inc., which owns the remaining 55 percent of Verizon Wireless.

"Verizon Wireless is a market-leading business with strong growth prospects and the board of Vodafone continues to believe that retaining its full 45 percent interest is in the best interests of shareholders," the company said in a statement to the London Stock Exchange.

Analysts estimate that Vodafone's holding in Verizon Wireless, which has 52 million customers in the United States, is worth between $45 billion and $55 billion. Vodafone had until Thursday to exercise a put option and sell up to $10 billion worth of its stake. The company had come under heavy pressure from a rebel shareholder group to do so.

Activist investor group Efficient Capital Structures had called on Vodafone to spin off, or issue a tracking stock for, Vodafone's stake in the U.S. mobile operator — hugely increasing the company's debt to return more cash to investors.

ECS suggested that ditching Verizon would leave Vodafone better placed for growth in Europe and Asia as markets become more competitive and pressure grows to generate extra revenues from each customer. It was also frustrated that Verizon's value is not fully reflected in Vodafone's share price and that the business is not expected to reinstate dividend payments until 2009.

However, shareholders overwhelmingly rejected ECS' position when Vodafone put it to a vote at its annual general meeting last month.

Chief Executive Arun Sarin told shareholders at that meeting that the company saw a great future for the business.

"We're comfortable that we have a reasonable window where we can maximize the value" of the stake, he said.

Vodafone reported last month that Verizon added 1.6 million customers during the first quarter, matching the gain in the previous three months.

Vodafone shares rose 1.2 percent to 161.3 pence ($3.29) on the London Stock Exchange.

Verizon Communications shares fell 39 cents to $42.72 in New York.