Microsoft's Piracy Fight Gains Momentum in China

In his first official visit to the United States in 2006, China President Hu Jintao arrived for dinner at Microsoft Corp. Chairman Bill Gates' house with a gift for the host. Shortly before Hu's Seattle visit, the Chinese government had issued a decree requiring all personal computers manufactured in China to come with a licensed operating system before leaving the factory gates. Now, nearly two years later, that gift keeps giving. The software company co-founded by Gates is seeing the benefits of more stringent intellectual property policies in China, with a decline in piracy rates and improved results at its mainstay Windows division. China is by no means the worst offender. More than a dozen other countries -- including Indonesia and Ukraine -- have higher software piracy rates, according to a study from the Business Software Alliance and IDC. None of those countries, however, offers the promise of China, the world's second-largest PC market, growing at more than 10 percent a year. China's piracy rates, the level of pirated software in a particular country, dropped to 82 percent in 2006 from 90 percent in 2004, the study said. "In China, where piracy is the way things are done with respect to software, any marginal money Microsoft gets back is super-important," said Kim Caughey, portfolio manager and senior analyst at Fort Pitt Capital Group. Reducing software piracy and selling more expensive versions of Windows are ways for Microsoft to generate sales growth that exceeds the overall PC market, a task made difficult since its global market share already tops 90 percent. Microsoft said improvements in fighting piracy accounted for about $164 million of the $822 million revenue gain at the Windows client unit in the quarter ended September. Windows is Microsoft's most lucrative product with an operating margin exceeding 80 percent. "Every pirated copy that Microsoft converts into a paying customer all flows to the bottom line," said Morningstar analyst Toan Tran. "It could have a dramatic effect on its profit margin."
Pirates at work Despite the progress being made, pirated software is still readily available on the streets of Shanghai. Fuzhou Road in the former British concession near the Bund, an area famous for bookstores and art boutiques, is also locally renowned as a place to buy pirate PCs and software. The small alleyways running off Fuzhou Road host dozens of pirate PC shops, which usually have no signs. Locals ask passersby if they want to buy "cheap" PCs or software before leading potential customers to the store. Once a computer is assembled, the customer is given a list of pirated software options, ranging from Microsoft Office to Adobe Systems' Photoshop. If a software program is not there, it can be ordered. The government decree requiring PC makers to pre-install an operating system sought to address the problem of Chinese consumers buying computers without software and then opting to buy less expensive counterfeit software. Beijing went one step further, calling on any Chinese companies wanting to do business with the government to run properly licensed software. "The whole situation is heading in the right direction," said Hao Jing, spokeswoman at Founder Technology Group, China's second-largest PC maker. "Pre-installing genuine copyrighted operating systems has become an industry standard." Earlier this year, the Chinese police and the U.S. Federal Bureau of Investigation seized $500 million worth of pirated software, including counterfeit Microsoft and Symantec products, from a Chinese piracy syndicate. "We've seen in the last two years significant emphasis on legitimate intellectual property use in China," said Cori Hartje, director of Microsoft's genuine software initiative. Microsoft said it needs to do more in educating consumers to the benefits of getting genuine software like access to software updates and better security. Improved technology also serves to deter piracy. Windows Vista, the latest version of its operating system, has been more effective in preventing piracy. Microsoft has said piracy rates for Vista are half the level of its predecessor Windows XP. In Vista's first major update due out next year, Microsoft said it plans to close two primary methods used by software pirates to illegally copy Windows Vista.

Japan's DoCoMo May Tap Google on Phones

Japanese telco NTT DoCoMo is considering a partnership with Google, adopting the Web giant's search and e-mail features in its mobile phone Internet service, company sources said this week. The move marks a strategic shift for Japan's largest wireless operator by seeking a partner, as the firm has been lagging behind much smaller rivals in luring new subscribers in recent months. For Google, the alliance will provide access to DoCoMo's 48 million users of "i-mode" mobile phone Internet service as it tries to expand its presence in Japan, where Yahoo Japan leads the Web search market. The alliance may eventually lead to the development of new functions and handsets, the sources said. As of 0409 GMT on Wednesday, shares of DoCoMo were up 3.3 percent to 190,000 yen by mid-morning, outperforming a 1.6 percent gain by the benchmark Nikkei average .N225. "We are currently studying the possibility of an alliance in search services with domestic or overseas partners, but nothing has been decided yet," DoCoMo spokesman Hiroto Nakagawa said. Starting as early as spring, users will be able to access Google searches, e-mail, scheduling and photo-saving features through DoCoMo's i-mode network service, the Nikkei business daily said. While rival KDDI has already been working with Google in search and e-mail on its mobile phones, DoCoMo eyes deeper ties in services and technology with the U.S. firm, including development of next-generation handsets featuring Google's operating system, the Nikkei said. In a note to clients, Nomura Securities analyst Daisaku Masuno said DoCoMo's move is expected to boost the firm's data traffic revenue as expansion in services should increase page views. DoCoMo, which controls over half of Japan's mobile market, has been losing its market share amid a fierce price war. Softbank, the smallest carrier, signed up a net 191,600 additional subscribers in November, beating its rivals for the seventh-straight month. DoCoMo got the smallest number of net users among the three, with 48,200.

U.S. Wavers Again on ITER

By Dennis Normile
with reporting by Daniel Clery and Adrian Cho.
ScienceNOW Daily News
21 December 2007

The countries planning the world's biggest fusion experiment have learned not to count on the United States. So this week's decision by the U.S. Congress to strip out a planned $149 million contribution in 2008 to the International Thermonuclear Experimental Reactor (ITER) won't halt next year's planned start of the project in Cadarache, France (ScienceNOW, 18 December). But ITER officials say that they will miss the 9%26#37; U.S. share if the latest budget decision means that the United States is pulling out--for the second time--of the $12 billion project.

"I don't think there would be a big impact on the overall ITER plan" if the U.S. contribution is delayed, says Hiroki Matsuo, director for fusion energy at Japan's Ministry of Education, Culture, Sports, Science, and Technology. He says that the project is at the stage at which partners are making components, and rescheduling could accommodate a late part or two. It would be a more serious matter if the United States withdraws from ITER or fails to provide the funding it has promised, says Norbert Holtkamp, principal deputy director-general of the ITER organization. Even then, however, Holtkamp says a 9%26#37; hole in the budget "will do harm, but it's not going to kill" ITER. The European Union, as host, has agreed to provide 49%26#37; of the budget, with the other partners--Japan, China, India, Russia, South Korea, and the United States--divvying up the rest.

This is just the latest U.S. flip-flop on ITER, which is intended to demonstrate the feasibility of harnessing the fusion reaction that powers the sun to produce electricity without the emission of greenhouse gases. In 1985, the United States and the then-Soviet Union announced the project, which soon became a global effort. Midway through the design phase, however, Congress cut all funding, and the United States dropped out (ScienceNOW, 7 May 1998). In 2003, the United States got back into the game for the implementation phase (ScienceNOW, 31 January 2003).

As much as money, what the other ITER partners now want from the United States is clarity. "ITER is waiting for a statement from the U.S. on how they will deal with this," Holtkamp says. So, it turns out, are officials from the U.S. Department of Energy (DOE), the agency responsible for providing the U.S. share. "The Department of Energy is reviewing the budget situation and its implications, as well as assessing options for the U.S. government to continue to meet its commitment to this important international research program," says a department spokesperson, calling the 2008 number a "disappointing" level of funding.

In addition to zeroing out the budget line for ITER, Congress expressly forbade DOE to shuffle money from other programs to satisfy its promise to the ITER partners. But John Marburger, science adviser to President George W. Bush, believes that the prohibition will not stand and that DOE will be forced to dip into other programs. "I can't see DOE not living up to its obligations," Marburger told Science earlier this week. "The department will have to use its money to stay in the project, so [the language] really just amounts to another earmark."

Ironically, Congress did provide DOE with $93.5 million to operate the three smaller U.S. fusion experiments--$6 million more than it requested. Ordinarily, the extra money would come as a great relief to fusion researchers, who in recent years have worried that DOE will sacrifice the domestic fusion program to fund ITER. But U.S. researchers don't want to sacrifice ITER to maintain the domestic program, either, says Stewart Prager, a physicist at the University of Wisconsin, Madison, and chair of DOE's Fusion Energy Sciences Advisory Committee: "This goes catastrophically the other way."

Related site

More on ITER

FTC Approves Google/DoubleClick Merger

The Federal Trade Commission approved Google's acquisition of DoubleClick today, bringing to a close its seven-month review of the $3.1 billion merger that had drawn strident protests from industry competitors and privacy advocates. By a 4-1 vote, the commissioners blessed the merger of two of the heavyweights in online advertising with an unconditional approval, concluding that the combined company is "unlikely to substantially lessen competition." The approving commissioners also stated that the privacy issues raised by merging the two companies' immense repositories of consumer data are "not unique to Google and DoubleClick"; moreover, they determined that questions not directly related to antitrust issues are beyond the legal scope of an FTC merger review. Still, consumer privacy remains a serious concern in the development of online advertising, the commissioners said. As a companion piece to the majority statement, today they also proposed a set of principles for privacy and behavioral marketing. Pamela Jones Harbour, the lone dissenting commissioner, wrote in her statement that an unconditional approval of the merger would fail to adequately address both the anticompetitive and privacy concerns. With the FTC's approval, the European Commission is the only hurdle the merger has left to clear. Many analysts are warning that Google could face a tougher fight in Europe. The EC will hold a meeting on Jan. 21 in Brussels where regulatory officials, industry representatives and consumer groups will address the anticompetitive and privacy issues raised by the merger. The BEUC, one of Europe's leading consumer groups, sent a letter to the EC this week warning that the combined company would harm Europeans' privacy and potentially drive up prices for advertisers. Google is the runaway industry leader in serving up ads targeted to search results; DoubleClick operates as an ad exchange, linking advertisers with publishers looking to monetize their sites by placing banners and other types of ads on available inventory. Google announced the acquisitionin April. The approving commissioners argued that there is already substantial competition in online ad intermediation, citing recent purchases that other industry strongmen have made, such as Microsoft's acquisition of AdECN and aQuantive, and Yahoo's purchase of the Right Media Exchange and BlueLithium. The Commission also concluded that Google and DoubleClick, as independent companies, "are not competitors in any relevant antitrust market." "The FTC's strong support sends a clear message: this acquisition poses no risk to competition and will benefit consumers," Google Chairman and CEO Eric Schmidt said in a statement. Dissenting Commissioner Harbour said that she reads the market differently. Describing the likely impact of the combined company as "transformative," Harbour said that without the merger, Google would have become a competing third-party ad-serving networks with its beta "Google for Advertisers" and "Google for Publishers" products. Likewise, DoubleClick was poised to move beyond display ads and become a major player in ad intermediation, Harbour wrote, expressing the general view that online advertising is consolidating, and that search and display can no longer be seen as distinct markets. Harbour's assessment is a marked contrast to the majority's insistence that the rapidly evolving industry is still fragmented, and that DoubleClick did not have a dominant market position. It remains unclear what impact Harbour's strongly worded dissent will have on the EC review of the merger. Jeff Chester, executive director of the Center for Digital Democracy (CDD), which has been one of the most vocal opponents of the merger, chastised the FTC for failing to adequately protect the interests of U.S. consumers. "The Federal Trade Commission sidestepped its responsibility today when it approved the merger of two companies whose new, extended data-collection reach will give it unprecedented access to track our very move throughout the digital landscape," Chester wrote in an e-mailed statement. Chester believes that the privacy and antitrust issues are related, because merging the databases of the two companies would aggregate more consumer information than any potential competitor could hope to match. While he praised Harbour's dissent, Chester had harsh words for the other four commissioners. "The majority is living under the illusion that there is legitimate competition in online advertising," he told InternetNews.com. The CDD and the Electronic Privacy Information Center (EPIC) last week called for FTC Chairman Deborah Platt Majoras to recuse herself from the Google/DoubleClick review over a potential conflict of interest. Majoras rejected their complaint, and voted in the affirmative for the merger. EPIC executive director Marc Rotenberg is still mulling strategies to mount a legal challenge to the FTC's vote. That the FTC approved the merger without adopting any of their recommended conditions came as a supreme disappointment for Chester and other privacy advocates. The CDD had proposed that the FTC place a five-year moratorium on the aggregation of the two companies' data sets, for instance. Chester also feels that the FTC shirked its responsibility by painting privacy as a general concern for all online advertising, with nothing uniquely troubling about the Google/DoubleClick deal. "Google brainwashsed the majority of the Commission that privacy is an industry-wide issue not relating specifically to the merger, when in fact it's both," he said. The FTC's privacy statement calls on companies to consider its proposal for self-regulatory principles to address the concerns of transparency and consumer control of data collection, security and limited data retention, proactive opt-in policies and other issues. The FTC is accepting comments on its proposals from consumer groups and enterprise through Feb. 22, 2008. Meanwhile, other groups have lost no time weighing in. The Center for Democracy and Technology released a statement calling on Google to make a public address on how it intends to protect consumer privacy going forward. The group said that the FTC's new proposals indicate that the current state of self-regulation in online advertising fails to adequately protect consumer privacy. In contrast, the Computer and Communications Industry Association (CCIA) applauded the FTC for its unconditional approval. %26#147;It is important that dynamic and innovative Internet companies not be artificially constrained as they experiment with new technology, products and business strategies," CCIA President and CEO Ed Black said in a statement. "Privacy remains an important issue, but these concerns will benefit from separate, industry-wide consideration. As the FTC's statement observes, privacy issues 'extend to the entire online advertising marketplace.' It would do a disservice to consumer interests to shoehorn privacy questions into competition analyses regarding individual companies."

Yahoo Lands Mobile Partnership in Latin America

Yahoo announced Thursday that it has formed a partnership with America Movil, the leading wireless provider in Latin America, to deliver mobile services to 16 countries throughout Latin America and the Caribbean. The alliance will make its oneSearch product the default mobile search application for America Movil's 143 million wireless subscribers, its largest partnership with a mobile carrier to date. In October, Yahoo reached an agreement with Telefonica SA to deliver its mobile services to its customers in some European and Latin American markets. Once Yahoo gets the service up and running with America Movil and its subsidiaries, it will have the dominant share in the Latin American mobile-search market, according Yahoo spokesman Cory Pforzheimer. "We're continuously expanding our global presence for mobile search, Pforzheimer told InternetNews.com. "Our goal is to connect a billion people to Yahoo services through their mobile phone." Last month, Yahoo made oneSearch available for download to mobile subscribers in Mexico, Brazil and Argentina, irrespective of their carrier. Yahoo bills its oneSearch as a smarter way to retrieve information on the mobile device. Search results are presented with the limitations of the small screen in mind, so users do not have to wade through a series of PC links to access content. Results are refined for location, so a search for New York City will retrieve information about local traffic, weather and news, in addition to a link to explore the Web with the search term. It also provides quick access to Mobile Web sites, Yahoo's Flickr photo-sharing service and other content. "We will be working with each country to customize the product for mobile search," Pforzheimer said, adding that Yahoo will work with America Movil's subsidiaries to tailor the oneSearch application to deliver content that conforms to the linguistic nuances of the countries throughout Latin America. The deal with America Movil may be the largest partnership with a mobile carrier it has ever reached, but it is by no means the first. The company said that it has signed similar agreements with 20 other wireless carriers around the world. Yahoo struck 16 of those 20 partnerships with wireless carriers operating in the Asia Pacific region, Pforzheimer said. Yahoo unveiled oneSearch in the United States in January; it is currently available in 19 countries, with more coming through Thursday's partnership. Yahoo is in active talks with all the major U.S. carriers, but has yet to reach an agreement with any to deliver oneSearch as a default setting. The terms of the America Movil deal were not disclosed, but Pforzheimer said that it is structured as a multi-year revenue-sharing agreement between the two companies.

Paul Allen Wants In On Wireless Auction

WASHINGTON (Reuters) - A venture led by Microsoft Corp co-founder Paul Allen has applied to bid in an upcoming U.S. auction of coveted wireless airwaves, according to auction documents released late on Tuesday. Allen was listed with an entity called Vulcan Spectrum LLC among the applicants who filed to bid in the Federal Communications Commission (FCC) auction of 700-megahertz spectrum, which is scheduled to begin on January 24. Allen heads an investment company called Vulcan Capital and is also a majority shareholder in U.S. cable operator Charter Communications. Allen and Vulcan Spectrum were on a list of scores of potential bidders who filed applications ahead of a December 3 FCC deadline. The list was made available on the FCC's Web site late on Tuesday. The auction applicants also included, as expected, Internet leader Google and U.S. wireless providers AT%26T and Verizon Wireless, a joint venture of Verizon Communications and Vodafone. Also listed was Qualcomm. A Reuters search of the documents did not turn up any application by EchoStar Communications. There was speculation earlier this month that the satellite television operator might apply to enter the auction. Representatives of EchoStar could not be reached for comment. The FCC-run wireless auction is expected to take several weeks, with the spectrum to be auctioned off in several blocks. The radio waves are being returned by broadcasters as they move from analog to digital signals early in 2009. The signals can go long distances and penetrate thick walls. The auction is seen as a last opportunity for a new player to enter the wireless market. Google and other Silicon Valley leaders see the wireless spectrum as a way to create more open competition for mobile services and devices than those available on existing networks.

Microsoft, Google, Yahoo Pay up on Gambling Fines

WASHINGTON -- Microsoft Corp, Google Inc and Yahoo Inc agreed to a settlement worth $31.5 million to resolve accusations that the companies promoted illegal Internet gambling, the Justice Department said on Wednesday. The companies were accused of receiving money from online gambling businesses to advertise illegal betting from 1997 through 2007. As part of the settlement, the companies will pay cash to the U.S. government and provide millions of dollars worth of public service advertisements informing young adults and teenagers that Internet gambling is illegal. U.S. Attorney Catherine Hanaway in St. Louis, Missouri, who prosecuted online gambling company BETonSPORTS Plc earlier this year, announced the settlement. "These sums add to the over $40 million in forfeitures and back taxes this office has already recovered in recent years from operators of these remote-control illegal gambling operations," Hanaway said in a statement. Microsoft will pay $4.5 million to the U.S. government, $7.5 million to the International Center for Missing and Exploited Children, and provide $9 million worth of public service advertising. David Bowermaster, a Microsoft spokesman, said that Microsoft stopped accepting ads from online gambling sites nearly four years ago. "This agreement reflects our ongoing commitment to online safety," he said. Yahoo's settlement of $7.5 million includes forfeiting $3 million to the U.S. government and providing $4.5 million worth of online ads for a public service advertising campaign. Google will pay $3 million, the department said. The United States made it illegal in October 2006 for credit card companies to accept charges for online gambling, effectively closing the market to foreign companies. Many are based in Europe, such as 888 Holdings, PartyGaming and Sportingbet Plc. As part of a U.S. crackdown on Internet gambling, two founders of payments processor NETeller Plc were arrested in January. In May, BETonSPORTS pleaded guilty to U.S. racketeering charges and agreed to cooperate in a case against the company's founder and other co-defendants. On Monday, the European Commission accepted a U.S. offer to open U.S. markets for courier services, storage and warehouses in exchange for Europe dropping its fight for compensation for closing the U.S. gambling market to foreign firms. PartyGaming, bwin Interactive Entertainment and other European firms had hoped the European Commission would fight on. U.S. restrictions on online gaming wiped out billions of dollars of the European firms' market value.

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Ape See, Ape Do

By Mitch Leslie
ScienceNOW Daily News
13 December 2007

Apes can wield tools, learn sign language, and get hooked on TV. New research credits them with yet another ability once thought to be exclusively human: duplicating the facial expressions of others. The work suggests that this capability, which might help individuals synchronize their emotions, precedes the origin of our species.

Whether we're watching a movie or having coffee with an old friend, often we rapidly and unconsciously mirror the facial expressions of people we are looking at. Smiles, laughs, and grimaces of disgust are contagious. Why we're such copycats isn't clear. Youngsters might be learning the right moves for communication. Facial mimicry may also aid interpretation: To understand an expression, the brain recreates it. Some researchers think that emulating an expression might elicit the same feelings in the viewer, creating empathy.

To determine whether the ability extends to apes, behavioral biologist Marina Davila Ross and colleagues at the University of Veterinary Medicine Hannover in Germany videotaped pairs of young orangutans at play. They analyzed instances in which one of the playmates produced a neutral expression or a so-called open-mouth face (see video), which might be equivalent to the human smile. As the team reports this week in Biology Letters, if an orangutan showed the open-mouth face, its partner was likely to follow suit in less than half a second. When the researchers broke down the interactions by age, they found that mimicry was more common among juveniles and adolescents and when the two playmates were more than 2 years apart in age.

"The study showed for the first time that involuntary mimicry is present in animals, at least for facial displays," says lead author Davila Ross, who's now at the University of Portsmouth in the U.K. However, orangutans didn't always emulate their playmates, and the researchers now want to determine what other factors influence the behavior.

"It's important to demonstrate that facial expression and mimicry have an evolutionary context," says behavioral neuroscientist Stephanie Preston of the University of Michigan, Ann Arbor. That knowledge might help researchers work out how the behavior originated and what role it plays in social situations, she says.

SAP, Nakisa Tackle Workforce Management

SAP on Tuesday announced it had made a multimillion-dollar investment in Nakisa, a Canadian developer of software applications used to visualize employee depth charts and develop succession-planning strategies. In addition to the cold, hard cash, SAP also inked a global reseller agreement to sell Nakisa's OrgManagement and SuccessionPlanning applications (renamed as SAP's Talent Visualization by Nakisa) as part of the human capital management (HCM) (define) module within its core ERP (define) software suite. The investment, which SAP said is between $1 million and $10 million, was funded by the SAP NetWeaver Fund, a $125 million war chest set aside by the German software firm to invest in companies and applications built on and supported by its bedrock NetWeaver middleware platform. Since its inception in May 2006, SAP has now made a total of five similar-sized investments in companies including Questra, ArisGlobal, Visiprise and Conformia. Roughly one-quarter of SAP's 43,000-plus customers are running SAP's HCM application, SAP said. "Our customers are looking for end-to-end solutions and ISV services are a critical component," Kevin Ichhpurani, vice president of SAP's Global Business Development group, said in an interview with InternetNews.com. "We're committed to open ecosystems of ISVs that can contribute to the platform. We%26#146;re looking for gaps in the 28 different industries we service that we can fill with our partners through these investments." SAP found a gap that Nakisa could fill in the human resources department. Its OrgManagement software is a multilingual, Web-based data visualization and modeling application that connects to a company's HCM and ERP systems and displays the employee information as an organizational chart, directory or floor plan. Its SuccessionPlanning application provides analytical tools to help companies make hiring decisions and develop real or hypothetical succession planning programs for top-level executives. Talent management and, especially, succession planning have become increasingly important to large companies in the face of increasing compliance standards and the costs of on-boarding and off-boarding employees in the enterprise. For publicly traded companies, succession planning is considered a corporate governance issue because shareholders have a right to know of all material information that may affect a company's current and future performance. Having%26#151;or not having%26#151;a plan in place to replace a superstar CEO when he or she moves would surely have an impact on the company's performance. "We're seeing huge growth in the talent management area," Ichhpurani said. "Employee retention is becoming more and more important and we're really feeling a push from our customers for succession planning solutions." Last year, a study by the Society of Human Resource Professionals (SHRM) found that companies spend or lose an average of $4,745 for each new employee hired. These costs include time spent by recruiters and managers sourcing and screening candidates, time and costs spent training new hires and all the other minutiae required to get new employees up and running so they can actually do their jobs. In June, BearingPoint and Oracle launched an On-Boarding and Off-Boarding Diagnostic application to streamline the process. The software incorporates business process management and human capital management applications through Oracle's Fusion middleware in a service-oriented architecture (SOA) to bring clarity and structure to a process that impacts multiple business units within every enterprise. "Most of our clients have a lot of disparate systems that play a role the on-boarding process," Daniel Staley, managing director for BearingPoint's enterprise solutions group, told InternetNews.com in November. "There's HR from PeopleSoft or HCM from another vendor or a home-grown application for provisioning equipment. There are so many different silos and biggest issue is integrating all these pieces into one location to manage the on-boarding and off-boarding process." SAP's Ichhpurani said the company will continue to vet ISVs across all industries to fill in what he called the "key white spaces" that SAP's existing applications portfolio don't currently address. "Our objective is to spawn innovation on top of the platform," he said. "Unlike a traditional VC fund, instead of financial returns, we're looking first and foremost for synergies with SAP to solve specific customer problems."

EMC Tries Again With Invista

EMC has been lagging competitors such as IBM and Hitachi in block-based storage virtualization, but the company hopes to change that with Invista 2.0. EMC's SAN virtualization product combines application software and hardware with intelligent switches from Brocade and Cisco to provide "non-disruptive data mobility," said Rob Emsley, EMC senior director of software product marketing. Emsley described Invista 2.0 as a "watershed" event in EMC's virtualization development efforts. "Block-based virtualization is just starting to get traction," compared to the more established file virtualization market, he said. The new version of Invista includes higher availability, greater scalability and improved management, along with stronger VMware integration. Purdue University is one of about 200 Invista customers. Michael Rubesch, director of infrastructure for Purdue's Office of Information Technology, said the Indiana-based university didn't spend much time looking at block-based virtualization products before settling on Invista. "We have a fair amount of EMC gear, so it was a natural fit for us," he said. Invista has helped the university migrate from Symmetrix DMX-2 to DMX-3 arrays and add Clariion arrays to create a tiered storage environment. With an environment that's grown from 9TB to 220TB in seven years with only two storage admins, "Invista's been very helpful" coping with all that growth, said Rubesch. Invista's been easy to implement and Rubesch likes the direction it's heading in, but he said the product needs better integration with EMC ControlCenter management software, which can't yet display Invista targets. EMC has boosted Invista's availability with a new distributed control path cluster (CPC) architecture, which lets the nodes of the CPC be separated by campus distances for continuous operation in case of localized failures. EMC has also doubled the number of virtual volumes and storage elements and boosted the number of simultaneous mobility sessions by a factor of five, from eight to 40. With front- and back-end load balancing, EMC has also improved performance and throughput. Heterogeneous pooling and mirroring helps customers manage tiered storage environments by assigning applications to storage levels based on their importance. EMC has also added support for IBM DS4000 series arrays, HP PVLinks and SUN MPxIO path management software, along with EMC RecoverPoint integration for replication. Bryan Byun, VMware vice president of global partners and solutions, said Invista and VMware Infrastructure integration "helps to deliver the benefits of 'flat IT,' where a customer's significant changes can be coherently managed and handled online without disruption to servers, networks or storage." Pricing for Invista starts at about $100,000. Invista 2.0 is available now, while version 2.1 %26#151; which includes heterogeneous mirroring and storage pooling %26#151; will be available later this month, along with Invista support for VMware ESX Server 3.0.2, which will be posted to the VMware SAN Compatibility Guide. Back to Enterprise Storage Forum

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IBM Blasts Taiwan's Asustek Over Patents

IBM is asking the U.S. government to ban imports of some computers made by Taiwan's Asustek Computer, alleging that the products infringe three IBM patents. IBM said on Thursday it filed a complaint against Asustek and its North American subsidiary, ASUS Computer International, with the U.S. International Trade Commission. It said the patent infringement occurs in Asustek's own-brand computers as well as in products the Taiwan contract manufacturer makes for other brands. IBM did not name the other brands. Asustek's customers include large computer companies such as Apple and Dell. "They use the patented technology for computers they make for others as well as their own brand computers," said IBM spokesman Ari Fishkind. He would not say if companies besides Asustek could be affected by the complaint. "It's in the commission's hands. It's not for us to determine," he said. Asustek continued to sell computers using IBM technology after a licensing agreement between the companies expired on Dec. 31, 2004, he said. Asustek denied the allegations. "We have consulted our lawyers in the U.S. and they have concluded that the complaint has no merit," said Beck Lee, a spokesman for Asustek in Taipei. IBM said the infringing products include notebook computers, servers, routers and some components. It said the patents cover important aspects of computer systems, including power supplies, computer cooling and computer clustering capabilities. Asustek has been trying to establish its own brand, following in the footsteps of Taiwanese rival Acer. It has set a goal of becoming the world's fifth-largest notebook computer vendor by 2010. It launched a cheaper line of laptops called the Eee PC earlier this year and has said it expects to sell 5 million units globally next year. IBM shares were up 84 cents or 0.8 percent to $109.00 in afternoon trading on the New York Stock Exchange. Asustek shares closed down 2.37 percent in Taiwan on Friday.

IBM Acquires Arsenal Digital

EMC's acquisiton of Mozy two months ago put the storage world on notice that the online backup market was maturing. A pair of moves today by IBM and Hitachi Data Systems (HDS) confirms the trend. IBM announced that it is acquiring Arsenal Digital Solutions, one of the oldest players in the online backup space, and HDS and Data Islandia announced the development of a unique 'green' archiving center in Iceland. CommVault also unveiled a data storage software as a service (SaaS) offering today, while Seagate added to its services story with the acquisition of an e-discovery company. All this comes as IDC reports that storage hardware revenue growth continues to chug along at a 5 percent clip, half its growth rate from two years ago %26#151; and the bulk of opportunities are coming in the small and mid-sized business market, one of the target markets for online backup services, along with consumers and small and home office users. IDC research analyst Liz Conner said that "The growth of low-end networked storage is being fueled by an increased understanding and confidence among SMB users who are seeking more effective solutions to manage an increasingly complex and expanding set of requirements related to data storage." The trend is fueling growth in technologies like iSCSI SANs and online backup services. Nine-year-old Arsenal Digital is one of the oldest online backup firms, having survived the fallout from dot-com era storage service providers. It boasts 3,400 business customers, several of them Fortune 500 firms, and its reach exceeds 20 petabytes in 67 data centers on five continents. Partners include EMC, Hitachi, AT%26amp;T, Cisco, HP, Sun and Symantec, among others. IBM won't say what it paid for the North Carolina-based firm, which it will combine with IBM Global Business Continuity and Resiliency Services (BCRS) and its 150 recovery centers worldwide. Big Blue said it will make Arsenal solutions available worldwide through its BCRS services business, through Arsenal%26#146;s existing channel partners, including telecommunications providers, as well as direct through IBM.com and from select business partners. IBM BCRS Vice President Philippe Jarre stated that "IBM's leading business continuity and resiliency services, combined with managed services from Arsenal, give IBM the most comprehensive range of information protection services, and provide clients the ability to back up and protect their information in a way that is integrated with their business continuity plan." HDS Goes to Iceland Hitachi and Data Islandia, meanwhile, launched what they claim is the "world's most environmentally friendly outsourced data archiving service." Data Islandia has built facilities in Iceland with 100 percent green energy to offer international archival services. Using technology from Hitachi, Data Islandia manages the data for compliance, risk containment, governance and operational advantage. The facilities are powered completely by geothermal and hydroelectric energy. "Organizations are focused on making their data centers more efficient, but virtualizing six-month old information, which is effectively digital toxic waste, is a very poor use of resources. Instead, they should be looking to completely remove this data from the corporate network," stated Sol Squire, executive member of the Board of Directors and CBDO for Data Islandia. "We offer an ideal solution, with our geographic, regulatory and environmental advantages combining to offer very stable long-term rates on archival storage." The infrastructure's current capacity is a whopping 500 petabytes %26#151; and the companies say there is no limit to either real estate or power availability. The service's ambitions are global, with support services offered in European and East Asian languages, and is targeted at "multinational organizations with multiple data centers and complex data management requirements" in industries such as telecommunications, healthcare, government, high-performance computing and finance. Data Islandia will use the Hitachi Content Archive Platform as the core digital indexing and archival platform, and will use Hitachi's flagship Universal Storage Platform V to store the archived data. The two are also at work at some intriguing data mobility technology dubbed the "Data Scooter" and are launching a Web site devoted to it at DataScooter.com. Data Scooter appears to be an appliance capable of shipping as much as a petabyte of data between data centers, although officials declined to provide details of the offering. Also today CommVault announced a program that allows its resellers and partners to offer managed data protection services to SMB customers, using CommVault%26#146;s Simpana software suite as part of a packaged SaaS solution. And Seagate said it has signed an agreement to acquire e-discovery firm MetaLINCS, which makes software that helps companies search large volumes of electronic data for legal and regulatory information. MetaLINCS will become part of the Seagate Services Group, giving the company "one-stop sourcing for archive, recovery and collection, review tools and services inclusive of EVault's Insight E-Discovery services." Back to Enterprise Storage Forum

O RLY? Thank Photoshop For Internet's Goofy Memes

In the 1970s, a quintet of spray paint artists called The Fabulous Five turned New York trains and subway cars into their canvases. New Yorkers were impressed with art that stretched as far as 10 cars while the Transit Authority and hardware stores where the five stole their paint were furious. Thirty years later, the Five are gone, New York subways have been replaced with JPEG images and Adobe Photoshop has become the spray paint of the new century. The old saying "a picture is worth a thousand words" has never been more apparent as jokesters on the Internet use doctored images in place of text to get their messages across. The original "O RLY?" With the rise of Web-based message boards, images with a caption stamped on them have become a common form of response to a posting. One of the first notable examples of this was the "O RLY?" owl. In 2001, a photographer posted a picture he took of a snowy white owl with a ludicrous expression on its face. Someone interpreted the expression to say "oh really?" and used Photoshop to stamp "O RLY?" in large letters at the bottom. Very quickly, the O RLY? owl became a standard response to a disputed statement. Britney Spears is a great singer? O RLY? XBox is better than PS2? O RLY? Other owls followed up, like the "YA RLY" and a number of others with captions that seemed to convey the bird's expression. The original bird died in a zoo in 2005 but lives on in images, several video game references and a virus, W32/Hoots-A, which appeared in 2006. It would send pictures of the owl to a printer attached to the infected computer. A number of video games feature O RLY? references, as did an Australian sketch comedy show, where Hamlet's "To be or not to be" soliloquy was translated via subtitles to include "O RLY?", "YA RLY", and "NO WAI!". Adobe, not surprisingly, is rather amused at how its software is used. "It's actually pretty exciting to us to know that the same tool that sits at the core of the designer's and the photographer's workflow also can be used for everything from medical imaging to comic photo manipulation," said Kevin Connor, senior director of product management of Adobe%26#146;s professional digital imaging products. Drew Curtis, who runs the news aggregator FARK.com, knows a thing or two about Photoshop art. There have been Photoshop contests on FARK as far back as 2000. "I had an idea for a caption contest," he told InternetNews.com. "What happened was people started submitting Photoshops to the caption contest, so we decided to see if we could do a Photoshop contest and it took off so well that we stopped the caption contest. Not as a whole, but %26#91;Photoshop contests%26#93; pretty much replaced it." FARK now holds multiple Photoshop contests, including the "Iron Photoshop" contest, a reference to the kitschy Japanese cooking show "Iron Chef," in which artists are given a challenge, like doing a drawing using a limited palette of colors. Curtis said it attracts pros and amateurs alike. "Some people are so talented they can rip those things out in no time flat," he said. "There's more pros involved using Photoshop than you'd think." He also said that during the past few months, he has been contacted by a number of universities' photo-editing teachers. Increasingly, they're having their students enter photo editing contests like the ones on FARK. "They say it's a great teaching tool for that kind of thing," he said. Story continues on Page 2

Interactive Tube at Play in Gemstar-TV Buy

NEW YORK -- Macrovision Corp said on Friday it would buy Gemstar-TV Guide International Inc for $2.8 billion in cash and stock to form a broad video entertainment distributor, but investors concerned about the deal's price sent shares of both companies sharply lower. Macrovision shares dropped 25 percent after the company said it would raise $800 million in new debt to finance the deal, while Gemstar slid more than 17 percent as its shareholders thought the deal price was too low. "It's a reaction to the size of the deal and the fact they're %26#91;Macrovision%26#93; buying a larger company and taking out debt to do it," said SMH Capital analyst Scott Berry. "Strategically I think it makes sense. I think there are significant risks. It's a big pill to swallow," Berry added. Macrovision said it would combine its anti-piracy technology with Gemstar's interactive television program guide, which is used by cable and satellite operators, to make protected TV shows, films, photos or music available on many more devices. Gemstar also publishes TV Guide magazine. "For the consumer, (this deal) is all about discovery, making it very easy to find stuff (and) to acquire it, doing an automatic download," Macrovision Chief Executive Fred Amoroso said in an interview. Amoroso would remain CEO after closing of the deal, expected by early in the second quarter. "I want to take this movie, store it in my PC and then play it ... in my daughter's bedroom TV," he said. Gemstar shareholders would get $6.35 per share in cash or 0.2548 of a share of common stock in a new holding company that would own both Gemstar and Macrovision. Each existing Macrovision share would equate to one share in the merged company. Macrovision shareholders would own about 53 percent of the combined company. Former Gemstar stockholders would own about 47 percent of the new entity, which would seek continued listing on Nasdaq. Gemstar stock fell $1.04 to $4.94 on Nasdaq. "I think Macrovision's stealing Gemstar," said Janco Partners analyst April Horace who estimates Gemstar's value at $7 a share. She suggests that the purchase could have made more sense for a strategic buyer such as Microsoft Corp (MSFT.O: Quote, Profile, Research) or Google Inc (GOOG.O: Quote, Profile, Research), which could have paid up to $9 per share. News Corp (NWSa.N: Quote, Profile, Research) owns about 41 percent of Gemstar-TV Guide and has agreed to vote in favor of the deal. "We think it's a smart combination of businesses," a News Corp spokeswoman said. "We look forward to seeing how it performs. We will continue to evaluate it." Next Page: Double-Digit Revenue Growth?

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Fox's Faith-Based Acquisition

Media conglomerate News Corp. yesterday said it's planning to acquire Beliefnet, the world's largest community site built around religion and spirituality. News Corp. is hoping that its latest acquisition will provide the media giant with an online venue to promote its existing faith-based businesses, as well as another platform for content distribution and advertising revenue. Terms were not disclosed in the deal, which will see the site being added to News Corp.'s Fox Entertainment Group (FEG) unit. According to a Fox statement, the unit plans to roll Beliefnet into its growing digital media division, which promotes the company's television and film businesses online. Beliefnet aims to provide a forum for a thoughtful and tolerant exchange of spiritual ideas. The site includes discussion groups on a number of topics relating to spirituality, including prayer, meditation, major religions and the "God-O-Meter," where blogger Dan Gilgoff weighs in on the presidential candidates' invoking of the Almighty in their campaign rhetoric. On a blog posting on Beliefnet's site, Editor-in-Chief Steve Walden responded to readers' complaints about the merger, reminding them of Fox's other faith-related assets, such as the religious book publishers Zondervan and HarperOne and the Fox Faith unit that produces spirituality-based films. Walden also said that Beliefnet for years had been approached by suitors looking to acquire the site. He added that it chose to remain independent until now because none of those earlier bidders would have been able to help the site better meet its mission. "We created Beliefnet primarily to make a difference, not a killing," Walden wrote. "As I explored the possibilities with News Corp., it became clear that, with their help, Beliefnet would be able to take %26#91;a%26#93; quantum leap in what we do." "The best spiritual and religious teachers -- from %26#91;evangelical minister and author%26#93; Rick Warren to the Dalai Lama -- pass through News Corp. doors," he added. "News Corp.'s reach is enormous. Its proficiency in the areas of video, social networking and media in general is unsurpassed." Walden's effort to reassure Beliefnet members about the acquisition may have fallen on a few deaf ears, however, as some members fired back at the deal in a comment thread. "All it means is more in-your-face ads, spam in your mailbox and some corporate types who think spirituality is a commodity that's bought and sold on the 50th floor of some office tower run by caffeine addicts who whine about ratings," one member wrote this morning under the handle "Capt-Kirk".

Is Android in Verizon Wireless's Future?

Did Verizon Wireless CEO Lowell McAdam misspeak? Just last week, Verizon Wireless made its surprising open access announcement that will let third party devices on its network by the end of next year. Now, according to one published report, Verizon will also support Google's Android open software development platform for mobile devices. "We're planning on using Android," Verizon Wireless CEO Lowell McAdam told BusinessWeek. "Android is an enabler of what we do." If that sounds like there will be Verizon Wireless phones with Android software, that's not quite the official company line. "Verizon Wireless has not yet decided whether we will use Android in any of the devices we ourselves offer," Verizon Wireless spokesperson Nancy Stark said in an e-mail to InternetNews.com. "We certainly expect some in the development community to embrace the Android platform in the open access devices and applications that they develop." As for McAdam's quote, Stark said it was in the context of "Android as an enabler of what we are doing with our whole Open Access initiative %26#150; i.e. it introduces another mobile platform for developers to work with %26#133; in developing handsets and applications." Announced last month, Android is the software platform the Google-led Open Handset Alliance is promoting for the development of mobile applications. Telecom and phone-related companies pledging support for OHA include Qualcomm, T-Mobile, Sprint Nextel, Motorola and Taiwan's HTC. New phones using the software aren't expected out till the second half of 2008; a software development kit for Android was released November 12. Android, which Google acquired in 2005, includes an integrated software stack consisting of an operating system, middleware, user interface and applications. The OHA said at the announcement that Android will be made available "under one of the most progressive, developer-friendly open source licenses, which gives mobile operators and device manufacturers significant freedom and flexibility to design products." Analysts said whether Verizon Wireless (a joint venture of Verizon Communications and Vodafone) supports Android directly in its own devices or not, the bigger issue is the seismic shift in the industry around openness. "It does look like the ice floes are breaking up, the locked-in, sub-optimal device we had as standard is opening up," said analyst Roger Kay, president of Endpoint Technologies Associates. Kay thinks Google's move to launch the Open Handset Alliance and bid on the government's auction of 700 MHz spectrum to create a more open wireless network, has pushed the carriers to respond. "Individual companies are always motivated to create a walled garden to extract monopoly rent, but buyers want as much choice as they can," said Kay. "If you left it up to the carriers, they'd keep separate walled gardens forever. But now that change seems inevitable, I think companies like Verizon Wireless see a value in leading the open charge and getting some brand association value out of that." Gerry Purdy, chief analyst for mobile %26 wireless at Frost %26 Sullivan, said OHA promises to bring more devices to the Verizon Wireless network whether the phone giant includes the software in any of its own devices. It's all part of the changing economics of the phone business. "Companies are wising up to the benefits of recurring revenue ad revenue as Google has shown, versus trying to own everything," Purdy told InternetNews.com. Purdy said Apple's iPhone revenue-sharing deal with AT%26T started a kind of ecosystem realignment that is still playing out. "You have the potential, for example, of location-based services for 3 billion devices. I think what Verizon Wireless did is look at whether it wanted to continue trying to squeeze out six or seven percent in subscriber growth every year or look at a paradigm shift that has the potential to grow it's share 20 to 30 percent." And unlike AT%26T's deal with Apple, Purdy noted that Verizon Wireless won't have to pay to get these new devices on its open network. But just how easy it will be to get on the Verizon Wireless's network remains to be seen. The company said it would publish the technical standards the development community will need to design products to interface with the Verizon Wireless network early next year. Devices designed to meet those standards will be able to plug into the the network nationwide by the end of 2008. According to a company statement, any device that meets the minimum technical standard will be activated on the network. Devices will be tested and approved in a $20 million state-of-the-art testing lab which received an additional investment this year to gear up for the anticipated new demand. Any application the customer chooses will be allowed on these devices, said Verizon Wireless.

Facebook Apologizes For Beacon Blunders

A month after announcing Facebook's advertising "revolution," humbled CEO Mark Zuckerberg issued a statement Wednesday apologizing for the way his company rolled out the Beacon ad platform and for its sluggish response to the maelstrom of criticism that followed. Significantly, Zuckerberg's apology also comes with the assurance that Facebook members who do not wish to participate in Beacon can turn the program off entirely, bowing to pressure from privacy advocates and many Facebook users. "We've made a lot of mistakes building this feature, but we've made even more with how we've handled them," Zuckerberg wrote in a posting to the Facebook blog. "We simply did a bad job with this release, and I apologize for it." The Beacon advertising program posts notices to Facebook members' news feeds about actions they have taken on the external Web sites of Facebook's advertising partners. In addition to causing the unwitting publication of holiday gifts that Facebook users bought for their friends, the program elicited a host of challenges from privacy, security and legal experts. Zuckerberg said that Facebook's goal with Beacon was to create a simple mechanism for members to share information with their friends about their lives outside of the site. It had to be "lightweight," he wrote, so it wouldn't get in the way of what people were doing on the Web. Zuckerberg hadn't figured that "lightweight" would translate to "stealthy" on implementation. He said that's where Facebook miscalculated, and that it took too long to respond to users' complaints that their actions got posted if they didn't click the "No, thanks" icon quickly enough. Zuckerberg's tone of general contrition about Facebook's handling of the Beacon controversy paired with the complete opt-out offering stands in sharp contrast to the company's earlier efforts to placate critics with incremental tweaks to the system and breezy public statements which critics found evasive. While Wednesday's statement represents a significant shift in Facebook's policy, some of Zuckerberg's staunchest critics are still unmoved. "Today's announcement that Facebook users will be able to turn off Beacon, following last week's opt-in changes, is a step in the right direction," Jeff Chester, executive director of the Center for Digital Democracy (CDD), wrote in an e-mail to InternetNews.com. "But Mr. Zuckerberg isn't truly candid with Facebook users. Beacon is just one aspect of a massive data collection and targeting system put in place by Facebook." Chester is referring to Facebook's first concession to the outraged privacy groups and members, which came last week when the company announced that it would not post any actions that users made on external sites to their News Feeds without their permission. That was enough to get MoveOn.org, the civic action group that has been one of Beacon's most vocal critics, to declare a cautious victory in its fight to get Facebook to take its users' privacy more seriously. Then came the news from security researchers at Computer Associates that Facebook was still collecting data about actions users took on external sites even if they clicked an icon to prevent the item from being posted to their news feed. In his statement, Zuckerberg said that Facebook will not store the actions on third-party sites that users who opt out of Beacon altogether take, "even when partners send them to Facebook." The fact that he acknowledges Beacon partners can still send information about the actions of users who have opted out of Beacon to Facebook leaves the Zuckerberg and Facebook open to further criticism. Judging by the early reactions posted on the discussion board sections of MoveOn's Facebook petition group, a data-collection policy that takes on faith that Facebook is true to its word is not going to be good enough for some users. And for privacy groups like the CDD, the Beacon controversy is simply the highest-profile example of the troubling intersection of commerce and social media. The CDD is still moving ahead with the complaints it planned to file with the Federal Trade Commission (FTC) and other regulators about the data-collection practices of Facebook and other social sites. "Mr. Zuckerberg can't simply now do a digital 'mea culpa' and hope that Facebook's disapproving members, privacy advocates and government regulators will disappear," Chester says.

Study: I/O is Main Hindrance on Virtualization

UPDATED: Xsigo Systems on Monday released a study that it says identifies a major complication in the deployment of virtualization servers: the data bottleneck from all of the I/O that takes place in a virtualized world. The current I/O (define) infrastructure in servers was designed for traditional usage, which is typically one application or use per server. If a machine was acting as a Web server, it would connect to a database or e-commerce system, while a mail server would connect to a storage system. This allowed for servers to run in a 1U "pizza box"-style server with a single gigabit network connection. But in a virtualized system, multiple application servers require multiple connections and multiple Ethernet ports to handle several gigabits of data going in and out of the server. "Think about this: The race to virtualization is all about density," Greg Schulz, founder and senior analyst with The StorageIO Group told InternetNews.com. "You can squeeze multiple servers onto a virtual machine, but as you put more and more of those servers, you have to do something about the connectivity." "If you put the equivalent of eight servers on one machine and each needed one gigabit of bandwidth, that's eight gigabits," he said. "A one-gigabit Ethernet port isn't enough." Xsigo Systems is a startup, launched in September specifically to address the I/O connection bottlenecks. Not surprisingly, its report suggests there's indeed a need for its products. Its flagship offering, the 780 I/O Director, provides a single interface into a 1U server for all virtualized connections. Using one or two InfiniBand connections instead of multiple Ethernet connections, the Director can reduce the amount of cabling required by up to 70 percent, according to Jon Toor, vice president of marketing at Xsigo. At the same time, it can provide a full 10-gigabit bandwidth for all virtual applications. A dual-rate InfiniBand port can hit 20 gigabits. To accommodate virtualization I/O, servers require six to 10 ports, which means a 4U box to handle all those cards and ports. The Xsigo survey found that 75 percent of virtualized servers have seven or more I/O connections per server, compared to two to four connections for a server running without virtualization software. So while virtualization may allow a datacenter to consolidate from 500 servers to 100 servers, you end up with a spider web of cabling. "What ends up happening is you end up connecting everything to everything," Toor told InternetNews.com. "People can overrun traditional I/O with services they have in a virtualized environment, unless you put a lot of the load in the same physical box." Managing the physical cabling is as important as managing the I/O and the adapters, Schulz said. "For users looking to save money, it's about an ease of management and reducing the amount of adapter cards and cabling," he said. In a standard virtual server, each port runs at 1 gigabit and the ports are separated. With the Director, the full 10 gigabits are available to any application that needs it. So if one application requires several gigabits and the others don't require it, that app can have full access to all of the bandwidth. Adding to the problem is the fact that ports are often being assigned to applications by MAC address, so it's difficult and time-consuming to move an application to a new physical server because the networking has to be reconfigured on top of moving the application. Xsigo found that 35 percent of virtualization users had to reconfigure I/O connections six or more times in the past year, usually when they moved a virtual server to new physical hardware. The survey also found that 58 percent of virtualization users had to add connectivity to a server specifically for virtualization requirements, and because of this, had to use larger hardware -- 4U instead of 1U -- which consumes more power. Privately-held Xsigo features some heavyweight venture backing from the likes of Kleiner Perkins, Khosla Ventures and Greylock Partners. Update adds comments from Schulz.

Sun Ready to Launch x86 Virtualization Management

Sun announced the pricing, availability and further details of the xVM Ops Center virtualization management software it unveiled last month at the Oracle OpenWorld conference. Ops Center goes hand-in-hand with Sun's other announcement at the conference, its xVM virtualization software. Another part of today's announcement is that Sun will release the source code used to build xVM Ops Center to its OpenxVM.org community starting December 10. Developers will "be able to play around with the agent infrastructure and modify it," Oren Teich, director of marketing for xVM," told InternetNews.com. Sun xVM Ops Center is designed to reduce datacenter management complexity by combining a range of lifecycle management functionality into an all-in-one tool. The idea, Sun said, is to simplify discovery, monitoring, operating system provisioning, comprehensive updates and patch management, firmware updates, and hardware management from power up to production in cross-platform Linux and Solaris Operating System-based x86 and Sparc environments. Teich said patches can be more easily scheduled using Ops Center with compliance as well as physical inventory reports, "Things you don't want to have to do manually because they take too long," he said. Sun plans to make money on support and service for Ops Center, which will be available for free download. The first commercial release is set for January 8, 2008 at what Sun said is an "aggressively priced" rate of $100 per managed server. The price can rise to $350 depending on other features selected. A $10,000 Satellite Server subscription includes an on-site enterprise installation service and hands on training. Sun also plans to release its own hypervisor by the second quarter of 2008, when Teich said it will also update Ops Center. He said Sun's software works with leading hypervisor's from VMware and Citrix (XenSource). "VMware and Xen enable a huge amount of sales for us," said Teich. "We love them." At Oracle OpenWorld, Sun's xVM announcement was somewhat overshadowed by it's other announcement of a rapprochement with Dell. CEO Michael Dell took the stage with Sun's CEO Jonathan Schwartz to announce an agreement to distribute Sun's software, though the computer giant also is remains a leading supplier of VMware and inked a deal in October to distribute XenSource as well. Ops Center will include a unified management console designed to help users manage both the virtualized and physical components of their IT environments. Schwartz said Sun xVM Server, Sun's virtualization server, will include code derived from its work with the Xen open source community. Teich said Ops Center is best-suited for mid- to larger sized companies with 100 to 300 servers or more. "We also have some installations with many thousands of servers that will benefit," he said.

Antibody Therapy Shows Promise for Diabetes

By Jennifer Couzin
ScienceNOW Daily News
3 December 2007

An antibody therapy that's approved to treat certain cancers and arthritis has helped prevent--and even beat back--type 1 diabetes in mice. The news is heartening to researchers, who had already launched a human trial of the therapy, rituximab. But it also raises concerns that diabetes patients and their doctors will start trying the drug before it's been shown to work in humans.

Type 1 diabetes occurs when the immune system attacks and destroys insulin-producing cells in the pancreas. For years, T cells were considered enemy number one, because they commit the actual attacks. But more recently, scientists have eyed another potential culprit: B cells, which may be setting the T cells off by presenting them with antigens, proteins that stimulate the immune system. The drug rituximab, made by Genentech, is an antibody that depletes B cells and has been shown to combat rheumatoid arthritis, another autoimmune disease. With that in mind, an international network of researchers successfully lobbied for a clinical trial of the drug in type 1 diabetes, even though mouse studies were lacking. That trial, begun last year, has enrolled 82 people--the youngest being 8 years old--and will take another year or so to finish.

The absence of mouse studies was "a concern in our scientific community," says immunologist Li Wen of Yale University. With that in mind, she, along with Yale immunologist Mark Shlomchik and their colleagues, genetically engineered a mouse model to test the drug. Wen's animals are predisposed to diabetes and have the human version of CD20, the molecule rituximab targets, on the surface of their B cells. Because mice have an immune response to rituximab, Wen and her colleagues designed a rituximab-like antibody that wouldn't cause this problem.

The researchers tested the drug in mice of various ages, including 4- and 9-week-old animals that didn't have diabetes and older mice within 6 days of diagnosis. In the animals that were still healthy, about 70%26#37; of those receiving the antibody therapy were diabetic by 35 weeks of age, compared to nearly 100%26#37; of those that received a placebo. This translates to a 10- or 15-week delay in developing diabetes--the equivalent of 10 or 15 years in humans, says Wen. In the 14 mice with established diabetes, five stopped needing insulin for more than 2 months, some for up to 5 months, the researchers report in the 3 December issue of the Journal of Clinical Investigation.

As the animals regained their B cells, Wen and her colleagues found that those cells were better behaved than their B-cell predecessors that were wiped out by the drug. For example, the new B cells were less likely to produce autoantibodies that often precede type 1 diabetes, suggesting that the drug had somehow recalibrated the immune system.

Mark Pescovitz, a transplant immunologist at Indiana University, Indianapolis, and head of the rituximab clinical trial, is heartened by the results. "[I'm] even more confident that our study will succeed," he says. Still, Pescovitz worries that the new mouse findings will cause physicians to jump the gun. "I would hope that [doctors] aren't going to run out there with their next diabetic and throw rituximab at them, but there's nothing to stop them," he says. The drug is not without side effects such as infections and rashes, and although Pescovitz is impressed with the mouse work, he notes that many drugs that work in mice fare less well in people.

Waste Energy, Fight Disease

By Steve Mitchell
ScienceNOW Daily News
4 December 2007

Mice genetically engineered to burn energy less efficiently live longer and are resistant to several age-related diseases, including cancer, hardening of the arteries, and obesity. The finding suggests that drugs based on this strategy could one day help stave off these age-related conditions in people, the researchers say.

Cells produce a molecule called ATP in their mitochondria that provides energy for the body. The weight loss drug 2,4-dinitrophenol (DNP) blocks this process, causing mitochondria to produce heat instead of ATP and forcing cells to metabolize stores of carbohydrates and fat for energy. Although popular in the 1930s, DNP use was discontinued in 1938 after several people died from overheating. More recent research in mice indicates that uncoupling proteins, which reside in the mitochondria and work like DNP, may offer an alternative strategy for weight reduction. Now, a team led by endocrinologist Clay Semenkovich of the Washington University School of Medicine in St. Louis, Missouri, has found that uncoupling protein 1 (UCP1) may also help ward off other conditions.

UCP1 is normally found in body fat, but the researchers genetically engineered mice to express low levels in their skeletal muscles. The mice had higher rates of metabolism but appeared healthy otherwise, and their core body temperature was only 0.5?C higher than that of normal animals. The UCP1 mice lived longer on average, dying at 30 months compared to the 27-month life span of normal animals. Although cancer of the lymphatic system was the most common cause of death in the normal animals, killing 12 of 53, only four of the 51 UCP1 mice died from the disease.

That wasn't the only benefit. Mice that normally develop hardening of the arteries were protected from the condition after being bred to express UCP1 in their skeletal muscles. When UCP1 expression was triggered in the skeletal muscles of mice that were already obese, weight and blood pressure decreased, whereas weight increased in the normal obese animals, the researchers report in the December issue of Cell Metabolism.

Semenkovich's team speculates that the beneficial effects of UCP1 may be due to increased metabolism. Such activity can trigger molecular pathways that result in less of the chronic inflammation that has been associated with age-related diseases. Physiologist Kevin Conley of the University of Washington Medical Center in Seattle thinks something else is going on. The inefficient muscles may spur the genesis of more mitochondria, he says, which could lead to "a rebuilding of the cell that reverses cellular damage that occurs with age and age-related diseases."

Regardless of the mechanism, Semenkovich says the approach may be applicable to humans. "If we can figure out a way to target therapies to do this in skeletal muscles of people, it might be a way to treat age-related diseases," he says. Biologist Patrick Schrauwen of Maastricht University in the Netherlands agrees, but he adds that little is known about uncoupling proteins in humans and more investigation will be necessary before attempting to manipulate them to prevent disease.