Pc News

[Rasputin]

The Interview
In an interview with IDG News Service, Google's Zaeske explained that the company sees Groups as a great vehicle for discussion, collaboration, and content generation. An edited transcript of the interview follows.

IDGNS: Google launched Groups about six years ago, after acquiring Deja.com's Usenet Discussion Service, whose archive of forums and messages dated back to 1995. Today people have other newer services to interact online, like social networks, blogs, wikis, and virtual worlds. Aren't discussion forums a bit dated?

Zaeske: With Groups we're going well beyond normal discussion forums by adding the ability to do great things like creating Web pages and the appearance for your group. We're trying to complement discussions with a lot of the great things going on on the Web right now that make it really exciting for people to collaborate. Blogs are mostly about self-expression, and social networks are largely about having fun. Wikis are about gathering knowledge. We see the new version of Groups as wikis for the masses, with discussions woven in.

IDGNS: Still, as these newer Web 2.0 services continue to expand and improve, won't discussion forums become obsolete in the near future?

Zaeske: Discussions in general are a feature that is useful for a number of reasons and that will never become obsolete and will be part of all of these services [like wikis, social networks, and blogs]. Discussions are a source of publicly searchable information--particularly of user expertise in certain areas--but it's also very convenient to get into discussions.

We think adding Web page creation and the ability to change the appearance of your forum will cause Groups to be perceived as more than just a discussion forum product. Our goal is to let people do all sorts of creative things and talk about them in Groups. I'd say that Groups is more about groupware going forward and less specifically about discussions. It offers a great discussion service, but with the new features it's a lot about collaboration and expression and content creation.

IDGNS: Do you foresee integrating other functionality, like blogging, into Groups?

Zaeske: There are all sorts of wonderful things we want to do to Groups. Blogging would be a great feature. I can't comment on whether we're planning on doing that, but it would be very useful for Groups to have a blog feature. It'd be a natural thing to add to a group.

IDGNS: What about a wiki feature?

Zaeske: What we've just launched is essentially a wiki for people who don't know what the term wiki is. You can create Web pages, collaboratively edit them, have discussions on them, set access privileges in the group. It's pretty much a wiki.

IDGNS: What are Groups' usage and popularity like?

Zaeske: I can't comment on specific metrics, but obviously we're very interested in revamping the whole product, and that's due to the popularity we see in Groups. We want to take it to the next stage. People search it a lot because of the public information and the discussions that are available. Often when you can't find your answer on the Web, you can find it in Groups because someone has talked about it there.

IDGNS: Do you foresee any synergy between Groups and the wiki service JotSpot that Google recently acquired?

Zaeske: We're looking very closely at opportunities there. We're very excited about that. JotSpot offers some amazing things that seem very similar to what Groups offers so we're looking very closely at working together.

IDGNS: What about embedding word processing and spreadsheet functionality into Groups, from Google Docs & Spreadsheets?

Zaeske: I think that would be a great feature to add to the product. I can't comment on whether we're looking at that. Groups offers a lot of collaborative features; but if you look at Docs & Spreadsheets, that's another type of collaboration--and we're always looking at how we can bolt all these features together and leverage them.

IDGNS: Google is under a mandate from co-founder Sergey Brin to simplify and consolidate its menu of products and services. Would Groups be considered an umbrella-type of service under whose interface other services could be grouped?

Zaeske: That'd be a great question for our VP of products. I think collaboration in general is a category that's very important to Google--and content creation as well. How we package that is something that is a secret kind of thing right now.

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Vista Update Already Set

On the verge of the release of Windows Vista, Microsoft is already accepting orders for features to go in the operating system's first service pack.

Compiling Wish List
Microsoft is taking feedback from testers who are part of its Technology Adoption Program (TAP), which lets certain partners evaluate prerelease software, a Microsoft spokesman in London said on Wednesday. Service packs typically consist of a mix of bug fixes and new features.

Microsoft is set to release Vista for consumers next Tuesday, although it has been available to volume-license customers since November 30.

The company doesn't mention future update plans for Vista on its service pack road map. The spokesperson said a release date for the first service pack was not yet available.

The company, however, will continue to push out "critical" fixes for Vista through Windows Update, Microsoft's automated patch rollout system, the spokesperson said.

Comparing XP's Schedule
With Windows XP, Microsoft released the first service pack in September 2002, 11 months after the initial release of the OS. XP's second service pack--which added a host of security features to combat increased hacking--was released in August 2004.

Microsoft has said another service pack will ship for Windows XP, but the company has pushed its release to 2008 and some customers are skeptical that Microsoft will continue to update the operating system once Vista ships.

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Windows Vista: 15 Reasons to Switch

Windows Vista is almost here. To anyone who has been sitting on the fence over whether to upgrade to Microsoft's new operating system, I'll say it loud and clear: It's time to make the jump. There are plenty of reasons to leave Windows XP and install Vista, and below are my top 15 favorites.

Not everyone agrees with me, however. For the opposing point of view, check out PCW columnist Steve Bass's take in "Are You Sure About Upgrading to Vista?" and "Vista Upgrade: The Not-So-Rosy Picture."

To make up your own mind, read our Windows Vista FAQ. We also have our Vista review and our article on how to install Vista to assist you.

But I'm sold on upgrading to Vista. Why? Well...

1. It's the Interface, Stupid
Perhaps the best thing about Windows Vista is the most obvious: its new interface. With transparent animated windows that swoosh into place, subtle and elegant colors, a new Start menu, and plenty of other changes, this is the most beautiful version of Windows you've seen. If you've ever had Mac envy, this is the Windows you want--it's the most Mac-like interface yet.

2. Flip Over Windows Flip 3D
Switching between open windows using Alt-Tab in previous versions of Windows was always a shot in the dark, as you never quite knew to which window you'd switch, or even which ones were open. That has all changed in Windows Vista. Press Alt-Tab, and Windows Flip 3D springs into action, displaying thumbnails of all your open windows in a gorgeous, 3D stack. You can then flip through them until you find the one you want.

3. Live Thumbnails
Do you run a lot of programs and visit a lot of Web sites simultaneously? If so, you'll appreciate Live Thumbnails. Hover your mouse over any window on the Taskbar, and a thumbnail of the window pops up, with the program and document name, or the Web site name, just above it. The thumbnails are truly "live," so if a video is playing in a window, you'll see the video playing in the thumbnail too.

4. Boost Performance With ReadyBoost
Windows Vista includes a quick way to enhance system performance: ReadyBoost. It preloads files and programs you often use into RAM so that they're there when you want them, and you don't have to wait for them to load from the hard disk. You can buy an inexpensive USB flash drive and use up to 4GB of cheap RAM to boost your system performance.

5. Cool Performance Tools
If you're the kind of person who tends to peek under the hood and tinker, you'll find a lot to like in Windows Vista, which contains plenty of applets and utilities. Probably the best of them all is the Reliability and Performance Monitor. It keeps tabs on every aspect of your PC in exquisite detail, including the CPU, hard disk, network usage, and RAM use, and it includes plenty of charts, reports, and logs for your inner geek. The Reliability Monitor module is particularly noteworthy, as it charts the reliability of your PC over time and shows you every single problem or failure in a calendar format.

6. Better Security
At every level of Windows Vista, you'll find improved security. The firewall is now two-way, including inbound as well as outbound protection. Windows Defender offers spyware protection, and Internet Explorer has an antiphishing filter to protect against Web scams. A slew of security holes have been plugged in Internet Explorer, and the browser now operates in what's called Protected Mode, which guards system files against external attacks. There's plenty more under the hood as well, including Windows Service Hardening, which protects vital files and settings. (Note: BitLocker's automatic drive encryption and other advanced Vista security options are available only in the Business and Ultimate versions.)

7. Find Anything Fast With Search
Can't remember where you put an important file? It's no longer a problem. Windows Vista integrates a new search technology throughout the operating system--on the Start menu, within Windows Explorer, and just about everywhere else you look. It uses indexing and is lightning fast, and it literally searches as you type. A powerful advanced search tool lets you narrow your search by date, file size, author, tags, and location. It also accepts Boolean searching. You can even save your searches for future reference.

8. Nifty Software Gadgets
If you're a software gadget fan, you'll love Vista. It includes a variety of software gadgets that live on the desktop and do little tasks such as delivering stock quotes, showing weather forecasts, displaying RSS feeds, monitoring the state of your computer, checking your e-mail inbox, and more. Vista ships with a gaggle of them, but you can find dozens more online--and they're all free.

9. Better Wireless Networking
Anyone who uses a wireless network at home, at work, or on the road will appreciate the way Windows Vista handles wireless networking. You can more easily find new wireless networks, and save them and manage them as permanent connections. Wireless security has also been improved: When you connect at a public hotspot, security precautions (such as the shutting off of file sharing) automatically lock into place.

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10. Map Your Network
Want to see every single computer and device connected to your network--and get instant information about each, such as their IP addresses? The Network Map does that for you. It also lets you make instant connections to any device; double-click a PC, for example, and you'll connect to its shared folders.

11. Better Graphics With Windows Photo Gallery
Finally, with Windows Photo Gallery Microsoft has shipped a graphics utility that's worth using. It's a kind of jack-of-all-trades--you can view graphics and create slide shows, for example. But it also includes a surprisingly good set of simple-to-use image editing tools, including one for eliminating red-eye and another that cleans up photos with a single click.

12. Become a Director With Windows Movie Maker
Windows Vista comes with a new version of the much-maligned moviemaking tool Windows Movie Maker, and it's a big surprise--you'll actually want to use it. Importing video and music, creating transitions between scenes, and syncing music with video are easy. When you're done, you can burn your creation to DVD with Windows DVD Maker.

13. Better Notebook Support
In previous versions of Windows, the mobile-computing features seemed bolted on after the fact. That's not true with Windows Vista, as the Windows Mobility Center puts all the tools you need in one place.

You can turn your wireless adapter on or off, change your battery settings, and connect to an external display from a single location. And the new Presentation Settings feature is a big leap forward for anyone who often gives presentations with a notebook. You can customize settings--such as the resolution, mute, background, and so on--and then save them. Afterward you can switch from normal mode to presentation mode in a snap.

14. File Sharing and Syncing
With Windows XP it was possible to share files among PCs on your network--possible but often impossibly hard, it seemed. That changes with Windows Vista. The Network and Sharing Center lets you turn on and configure file sharing with single clicks. And the Synch Center lets you automatically synchronize files and folders among separate PCs. You won't have to do anything to keep them in sync; Windows Vista will do it for you.

15. Protect Your Kids With Parental Controls
Worried that your children may be exposed to inappropriate content online? Want to make sure they're not playing violent games? Parental Controls put you in the driver seat. Not only can you determine the kinds of sites they visit and games they play, but you can also enforce rules about when they'll be able to use the computer at all.

Vista goes on sale Tuesday, January 30; tech superstores across the United States will open at midnight to let you get a jump.

[Rasputin]

Nintendo Wii, DS Lite Sales Surge

Sales and profits at Japanese games maker Nintendo are surging on strong sales of its new Wii console and DS handheld gaming device.

The company sold 3.2 million Wii consoles in November and December, together with 17.5 million pieces of software, it said today. The console launched first in the U.S. on November 19 and sales totaled 1.25 million units by the end of the year. In Japan, where it debuted on December 2, sales were 1.1 million units and in Australia and Europe, where it was on sale within a week of the Japan launch, sales reached 800,000 units before the year ended.

The successful launch of the console had a direct effect on Nintendo's financial results.

The company reported sales in the first nine months of its financial year, the period from April to December, were $5.9 billion, up 73 percent on the same period a year earlier. Net profit jumped 43 percent to $1 billion and operating profit, which more closely tracks performance of the core business more than doubled to $1.4 billion.

The popularity of Nintendo's DS also contributed to the performance. Nintendo sold just under 19 million units in the April to December period and the handheld became the fastest rising gaming platform ever in Japan. New Super Mario Bros sold 8.6 million units and other popular titles continued to perform well, including Touch! Generations, Brain Age: Train Your Brain in Minutes a Day! and Nintendogs, the company said.

Net Profit, Game Sales Forecast
Earlier this month Nintendo, which is based in the western Japanese city of Kyoto, raised its financial forecasts for the full year because of the strong performance.

The company said it expects sales for the year to be $7.4 billion, a 22 percent increase on its previous forecast of $6.1 billion. Net profit is expected to be $992 million, 20 percent higher than previously predicted.

Nintendo kept the Wii console sales target for the full year unchanged at 6 million units but raised its Wii software sales forecast from 17 million games to 21 million games.

[Rasputin]

[Rasputin]

News Corp. Subpoenas YouTube Over Pirated Shows

News Corp.'s Fox television division has subpoenaed YouTube regarding programs posted on the video-sharing Web site, YouTube confirmed today.

Fox advised YouTube that the programs were on the site without its permission and YouTube removed them in accordance with its policy, it said. YouTube has since received a subpoena and said it will comply with U.S. legal processes.

The subpoena asks YouTube to provide information that could help Fox to identify the person who posted the videos, which include recent episodes of "24" and "The Simpsons," according to a report in Friday's Wall Street Journal.

Ongoing Copyright Problems
YouTube has faced several challenges regarding the unauthorized display of copyright content on its site, particularly since it was bought by search giant Google last year.

Japanese content producers have been trying to work with YouTube to prevent copyright materials from reaching its site, for example. Google has also received at least one legal challenge for displaying copyright videos: A French film company is suing it for including one of its films on Google Video.

Separately, Google announced Thursday that it will integrate YouTube more tightly with Google video, although the sites will remain separate. For example, YouTube video results will appear in the Google Video search index. When users click on YouTube thumbnails they'll be taken to YouTube.com to see the videos. The company also alluded to plans for international versions of YouTube.

[Rasputin]

Palm Finally Delivers Real Push E-mail

After many months, even years, of promising an e-mail push technology equivalent to what the RIM Blackberry service offers, it looks like Palm has finally done it.

At least it has come close, with a management component still missing.

Available next week, The Treo 680 and Treo 700p Smartphones will update Palm's VersaMail to include Microsoft Direct Push technology.

Although the push capability was promised via the next Microsoft Exchange ActiveSync Update, the push component of ActiveSync was delayed.

Immediacy of E-mail
The benefits of push over push-like are in battery life and real-time immediacy of e-mail.

Prior to the availability of Direct Push, a device had to remain on and ready to receive a packet from the server, with the server essentially asking whether the user was available to receive an e-mail. The necessity of always waiting for a ping reduces battery life.

Scheduled e-mail delivery also uses power by forcing the system to check for e-mails even when no new messages have arrived at the server.

In contrast, push technology wakes the device up with the arrival of the e-mail.

Difference Negligible
As far as real time goes, however, some industry analysts such as Ken Dulaney, senior mobile analyst at Gartner, claims if a corporate user can get an e-mail within 15 minutes of it being sent, the difference between real push and simulated push is negligible.

"Once e-mail uses a more or less a delivery-activated system as opposed to a periodic check, RIM will no longer have a major advantage," Dulaney said.

Those in the financial services industry might disagree with that assessment.

Direct Push adds other benefits as well. Push as a technology gives the server a remote, control channel. With push, IT can implement a theft loss-protection strategy to delete data or add password policy enforcement over the air.

In addition, cellular companies typically charge more for a BlackBerry data service to allow push e-mail, so Palm devices with an equivalent feature will have a service price advantage.

Direct Push will be available as a free download for VersaMail on Monday.

[Rasputin]

Google Dusts Off Discussion Groups

Online discussion forums date from the Internet's early days, and many people consider them passe in the Web 2.0 era of blogs, wikis, and social networks. But Google has no plan to put its Groups service out to pasture.

On the contrary, Google today unveiled an updated version of Groups. The discussion forum now sports a redesigned interface and new features such as the ability to create and edit Web pages and to upload and share files. According to Andrew Zaeske, Groups' engineering manager, this is just the beginning of the service's makeover.

Many of the new features have been available in a beta test version since last October; but the test is now over, and the improvements have been implemented in the main Google Groups service, the company said today.

The revamp gives Google Groups a facelift designed to keep it relevant as a tool for people to use in sharing information online. Once the most common way for people to form online communities, discussion forums must now compete with blogs, social networks, photo and video sharing sites, social news and bookmarking sites, virtual worlds, multiplayer games, and wikis.

Groups Still Valid?
At least one analyst believes that keeping Google Groups alive is wise because discussion forums remain useful to people interested in exchanging information on specific issues in a simple, mostly text-based, controlled online environment.

"Yes, you can argue that in the Web 2.0 world maybe discussion forums look a little dated," said Allen Weiner, a Gartner analyst. "But while discussion forums may not seem very 2007, the inherent beauty that made the Usenet model so appealing is that it allows passionate, like-minded people with a very granular interest to come together, in more of a closed community."

For now, Web 2.0 sites such as social networks and blogs seem to work best when they appeal to a broad, massive audience, and they seem to wither and wilt if they can't reach a certain scale, Weiner said. "Google Groups is certainly not Web 2.0, but I would label it Web 1.5," he said.

Current Google Groups users will see the new interface and features the next time they visit the site. Other enhancements include the ability to customize the look of forums, along with a new layout for threaded conversations done in the style of Google's Gmail Web mail service.

To join a Google Groups forum, visitors need only provide a valid e-mail address. Users who have a Google Account get access to more features.

The new version of Google Groups is available in 19 interface languages: U.S. English, U.K. English, French, Italian, German, Spanish, Dutch, Brazilian Portuguese, Danish, Finnish, Norwegian, Russian, Swedish, Polish, Turkish, Korean, Traditional Chinese, Simplified Chinese, and Japanese.

The Interview
In an interview with IDG News Service, Google's Zaeske explained that the company sees Groups as a great vehicle for discussion, collaboration, and content generation. An edited transcript of the interview follows.

IDGNS: Google launched Groups about six years ago, after acquiring Deja.com's Usenet Discussion Service, whose archive of forums and messages dated back to 1995. Today people have other newer services to interact online, like social networks, blogs, wikis, and virtual worlds. Aren't discussion forums a bit dated?

Zaeske: With Groups we're going well beyond normal discussion forums by adding the ability to do great things like creating Web pages and the appearance for your group. We're trying to complement discussions with a lot of the great things going on on the Web right now that make it really exciting for people to collaborate. Blogs are mostly about self-expression, and social networks are largely about having fun. Wikis are about gathering knowledge. We see the new version of Groups as wikis for the masses, with discussions woven in.

IDGNS: Still, as these newer Web 2.0 services continue to expand and improve, won't discussion forums become obsolete in the near future?

Zaeske: Discussions in general are a feature that is useful for a number of reasons and that will never become obsolete and will be part of all of these services [like wikis, social networks, and blogs]. Discussions are a source of publicly searchable information--particularly of user expertise in certain areas--but it's also very convenient to get into discussions.

We think adding Web page creation and the ability to change the appearance of your forum will cause Groups to be perceived as more than just a discussion forum product. Our goal is to let people do all sorts of creative things and talk about them in Groups. I'd say that Groups is more about groupware going forward and less specifically about discussions. It offers a great discussion service, but with the new features it's a lot about collaboration and expression and content creation.

IDGNS: Do you foresee integrating other functionality, like blogging, into Groups?

Zaeske: There are all sorts of wonderful things we want to do to Groups. Blogging would be a great feature. I can't comment on whether we're planning on doing that, but it would be very useful for Groups to have a blog feature. It'd be a natural thing to add to a group.

IDGNS: What about a wiki feature?

Zaeske: What we've just launched is essentially a wiki for people who don't know what the term wiki is. You can create Web pages, collaboratively edit them, have discussions on them, set access privileges in the group. It's pretty much a wiki.

IDGNS: What are Groups' usage and popularity like?

Zaeske: I can't comment on specific metrics, but obviously we're very interested in revamping the whole product, and that's due to the popularity we see in Groups. We want to take it to the next stage. People search it a lot because of the public information and the discussions that are available. Often when you can't find your answer on the Web, you can find it in Groups because someone has talked about it there.

IDGNS: Do you foresee any synergy between Groups and the wiki service JotSpot that Google recently acquired?

Zaeske: We're looking very closely at opportunities there. We're very excited about that. JotSpot offers some amazing things that seem very similar to what Groups offers so we're looking very closely at working together.

IDGNS: What about embedding word processing and spreadsheet functionality into Groups, from Google Docs & Spreadsheets?

Zaeske: I think that would be a great feature to add to the product. I can't comment on whether we're looking at that. Groups offers a lot of collaborative features; but if you look at Docs & Spreadsheets, that's another type of collaboration--and we're always looking at how we can bolt all these features together and leverage them.

IDGNS: Google is under a mandate from co-founder Sergey Brin to simplify and consolidate its menu of products and services. Would Groups be considered an umbrella-type of service under whose interface other services could be grouped?

Zaeske: That'd be a great question for our VP of products. I think collaboration in general is a category that's very important to Google--and content creation as well. How we package that is something that is a secret kind of thing right now.

[Rasputin]

Analysis: What Windows Vista OS Means for Microsoft

It's just days before the consumer launch of Windows Vista, and by now most everyone has heard about Vista's new and improved Aero user interface, desktop search, security, and various multimedia enhancements.



But there's far more to Windows Vista than the features consumers will experience when they use the OS. Five years in the making, Vista--an evolutionary move rather than a revolutionary one--has broad implications for Microsoft. Inside Vista are clues about the future of Windows, and how Microsoft plans to position its number-one core product going forward.

More Modular
Windows Vista represents a pivotal change for Microsoft for several reasons. For one, the company has been very public about how it changed its own internal development style to create Vista's new architecture.

Because previous versions of Windows had so many interdependencies between different parts and layers of the OS, Microsoft tried to create Vista as a modular OS with fewer interdependencies, which would ultimately make it more stable, said Al Gillen, an analyst with research firm IDC.

"With the way the OS has become modularized, it gives Microsoft the ability to bring features and functionality out in a much less disruptive fashion," he said.

In the future, this also positions Windows better to take advantage of virtualization technologies, which are becoming integral to the OS environment on both the server and the desktop, Gillen said. Virtualization allows multiple OSes and applications to run simultaneously in environments where previously only one OS or application could run.

"Virtualization is going to have a big impact on all OSes, and the more we use it and integrate it with our hardware and OSes, the OS has less to do because virtualization covers some of the features," he said. An OS has to be modular to take full advantage of future virtualization enhancements, Gillen said.

32-Bit to 64-Bit Computing
Secondly, Vista comes at a time when Microsoft--and the industry--is making the transition from 32-bit to 64-bit computing. The first version of Windows to come out in 64-bit was Windows XP, and Vista will follow suit, but both XP and Vista are primarily 32-bit OSes. It's widely believed, and Microsoft has hinted, that Vista will be the last version of Windows client to come in a 32-bit version.

Michael Silver, analyst for Gartner, said most PCs sold now are capable of running 64-bit applications, but that capability has not been widely used because the device drivers are not available for those applications.

However, by the time the next version of Windows client OS is available in 2009 or 2010, "the device vendors should be caught up in terms of 64-bit drivers," he said.

Still, Microsoft's huge partner ecosystem for Windows limits its ability to make drastic changes to its OS, and this may hamper its move to a 64-bit only version of the Windows client OS, Gillen said.

"If Microsoft brings out a release that disrupts 10 percent of their customers, that creates a lot of negative press for them," he said.

That comment rang true when Microsoft unveiled that the next version of Exchange would run only on 64-bit systems. Partners and customers protested because many of them already run Exchange on 32-bit servers, and the transition to Exchange 2007 will require them to either purchase new servers or retool their IT architectures to run the application on 64-bit servers.

Making big transitions to new technology is not the case for Microsoft rival Apple, which can be nimble in the innovations it wants to make in its OS and related hardware. "The Apple community grumbles for a while, and then they move on," Gillen said.

This factor also could affect the notion that Vista will be the last packaged version of Windows, and that Microsoft will deliver future versions as updates over the Web. Windows Vista is the first OS to be available that way, at least in upgrade form. Microsoft is giving consumers the ability to upgrade to higher-end versions of Vista over the Internet with an activation key.

Windows No Longer Top Microsoft Priority?:
But no matter how the next version of Windows Vista is delivered, it's clear that the OS is entering an era where it may not be the number-one priority for Microsoft that it once was.

"Microsoft is hoping that they diversify their revenue a bit more," said J.P. Gownder, principal analyst with Forrester Research. "This is obvious with consumer stuff like Zune and the Xbox, but also you see it with IPTV, where they've created a whole platform to sell to service providers. They recognize the OS will remain an important part of the business, but they will have to move into other areas."

It remains to be seen how successful Microsoft will be with Vista and its moves to derive revenue from other sources. But it's possible that years from now the industry will look back at Vista's launch on Tuesday as a major shift, both in perception and strategy, for the software vendor.

[Rasputin]

Virtual Gold Could Draw Real Taxes

Imagine getting a tax form and a warning to report taxable income from the IRS every time you collected rent on your hotel-stuffed Boardwalk and Park Place. Only in a bad dream, you might think; but don't underestimate the U.S. tax code's potential for surrealism. While the IRS won't be taxing Monopoly cash anytime soon, another variety of play money--earned and spent by millions of online gamers each day--may not be so safe.

Sometime in the next few months, the Joint Economic Committee of Congress will publish the results of an ongoing investigation into the economies of World of Warcraft, Second Life, and other massively multiplayer online game spaces (MMOs). The report's number-one bullet point will address a question that the inhabitants of these spaces may soon wish had been left unasked: Do the tax laws of the real world apply to virtual-world transactions?

For most people unacquainted with MMOs, of course, it's a mystery how the question could be asked at all. If you're among the mystified, you are probably unaware of the key feature that distinguishes most virtual game currencies from Monopoly money: an exchange rate.

Real-Money Trades
At this writing, the Azerothian gold coin--the in-game currency used by World of Warcraft's 7.5 million players to buy and sell the game's magic armor, weaponry, and other items--trades on eBay at an unofficial rate of seven to the U.S. dollar. Though most game companies try to ban or discourage these free-wheeling out-of-game markets, Second Life actively encourages a real-world type of economy with an official market-driven rate of roughly 50 cents per 100 Linden dollars (Second Life's currency). But whether the game companies like it or not, where there's an MMO, there's a way for players to buy what they want in the game with real money.

And naturally, where there is a way to pay real money, there is a way to collect it. From the player who sells his WoW character on eBay for a quick $300 profit to the laid-off factory worker making $7000 per month selling Second-Life animations he creates that let game couples dance and assume other poses, virtual worlds have blurred the line between work and play almost past recognition. Successful entrepreneurs like Second Life real-estate magnate and real-life millionaire Anshe Chung are the pixel-perfect face of a fast-growing "real-money trade" that is estimated by Steve Salyer, former CEO of online game item and currency retailer IGE, at nearly $1 billion worldwide--every penny of it as taxable as any other industry's real-money revenues.

[Rasputin]

Watch Out for Online Ads That Watch You

Online ads are not only booming--and scrolling, spinning, shaking, shouting, and singing--they are also watching you even as you are viewing them, capturing your click patterns to create more detailed profiles than traditional browser cookies do.

Behavioral marketing networks such as BlueLithium, Revenue Science, and Tacoda display ads based on your browsing habits. Spending on these behavioral ads will grow from $1.5 billion in 2007 to more than $2 billion next year, according to eMarketer, a market research firm. And the company expects video ads to account for more than a third of that total.

The networks say that behavioral ads are more effective for advertisers, and usually less intrusive for consumers, than are standard pop-ups or adware. But the potential for abuse is troubling, privacy advocates claim, and the vast majority of Netizens have no idea that their actions are being tracked so closely.

Visit any of the 1000-plus sites on BlueLithium's ad network, and your PC will get a cookie that records the Web pages you visit, the ads you click, and whether you bought anything. The network then delivers ads based on your interests: Shop for cell phones at one site, and you might see ads for handsets at another, unrelated site, while someone with other interests would see a different ad. Unless you keep a close watch on your browser cookies, though, you'd never know you were being targeted. BlueLithium chief marketing officer Dakota Sullivan declines to name any of the company's clients, but says that they include 70 of the 100 most popular sites.

Sneaky Cookies
Last November, the Center for Digital Democracy and the U.S. Public Interest Research Group filed a 50-page complaint with the Federal Trade Commission, claiming that such techniques by behavioral ad networks were unfair and deceptive marketing tactics.

"There's nothing wrong with serving an ad targeted to what users are interested in," says Jeff Chester, the CDD's executive director. "But you need to tell consumers exactly what you're doing and get their permission before you follow them from site to site."

Shortly after the complaint was filed, Tacoda said that it would periodically run ads on its network disclosing how it uses tracking cookies, and that it would set the cookies to expire after a year.

The Tacoda site features a prominent link to the Network Advertising Initiative's opt-out page, where consumers can turn off the tracking cookies from Tacoda, Revenue Science, and five other online ad networks (click on the thumbnail screenshot at the top of this article for a view of this page). NAI executive director Trevor Hughes says that, in addition, consumers can protect themselves by reading privacy policies and by carefully managing their cookies.

Revenue Science chief executive officer Bill Gossman says the way his company captures Web surfing data makes it "nearly impossible" to merge clicks with users' personal information. "If a new corporate owner, the government, or anyone else asked us to provide data on an individual user, we most likely could not do so," he says.

BlueLithium's Sullivan claims that linking a person to a surfing history would be relatively easy for companies with information on both, but doing so would ignite a firestorm of public criticism.

Database Risk
As Web entities continue to consolidate and corporate giants such as Microsoft enter the behavioral ad business, consumer advocates fear that the razor-thin boundaries between anonymous clickstreams and personally identifiable data could dissolve.

The risk? "Once a database exists, people often dream up ways to use it," says Peter Swire, an Ohio State University law professor and former privacy advisor to the Clinton administration. "Notice and effective choice by consumers are the way to go."

[Rasputin]

Hardware Vendors Launch Powerful Vista PCs

PC vendors rushed to launch souped-up computers today, offering faster chips and larger hard drives to handle the demands of Microsoft's new Windows Vista operating system.

Microsoft will begin selling Vista to consumers at 12:01 a.m. Tuesday, following its launch for corporate users in November. The Vista launch fever sparked the introduction of new desktops and notebooks from Dell, Gateway, Hewlett-Packard, Lenovo Group, and others.

Vista offers users a brazen graphical interface, demanding PC upgrades to provide optimal performance for its Aero glass translucent desktop windows and other features. In an era when sinking prices for chips and memory have pushed PC makers to slash their prices, vendors are jumping at the opportunity to add advanced components to each PC--and add dollars to its sticker price.

Dell's Vista PCs
Dell recommended that Vista customers upgrade their PCs from single-core to dual- or quad-core processors, from 1GB to 2GB of memory, from graphics integrated on a motherboard to a dedicated graphics card, from standard display to wide-screen, and from standard to fast-spinning hard drives. Vista can run on slower PCs as well, but it will automatically disable certain features, said Alex Gruzen, senior vice president of Dell's product group.

"If you installed Vista on an older system with a minimum performance level, you would frankly be overpaying if you paid for Premium or Ultimate, because the operating system scales itself to the capability of your hardware platform," he said.

Dell opened a Vista-oriented Web site with advice for consumers looking for the best PC to support their flavor of Vista--whether Vista Home Basic, Home Premium, or Ultimate.

"Vista has changed the user experience. In the past, for gaming you might get a discrete graphics card, but otherwise all those recent hardware advances went largely untapped if you were simply editing a document or browsing the Web," Gruzen said. "What's exciting about Vista is that it brings those hardware advances to bear in your day-to-day experience, instead of saving all that horsepower for discrete applications."

Vista, for example, allows users to play a video instead of displaying a static photograph as the "wallpaper" on their everyday desktop. Dell began taking orders for those computers on Saturday, and reported a 20 percent rise in Web activity compared to the previous weekend, leading to the sale of 10,000 Vista-loaded PCs. Microsoft will allow vendors to start shipping those PCs tomorrow.

HP's Offerings
Hewlett-Packard launched its own fleet of Vista-ready PCs, including its full HP Pavilion and Compaq Presario lines, led by the TouchSmart IQ770 PC desktop and the Pavilion tx1000 notebook, which allow users to augment Vista's graphical interface by navigating via a touch-screen display instead of a mouse. Some of those PCs are further upgraded to support the greater computing demands of Vista Premium.

The company is also selling migration consulting services, helping users transfer files, photos, and system preferences to a new PC. Its technicians can even do the work remotely by connecting to a user's PC over the Internet. HP charges $60 for a 45-minute session of that SmartFriend service. The company also has a Vista information Web page.

Vista: The New Standard
PC vendors acknowledge that many consumers and businesses will wait to upgrade their PCs until they are more comfortable with Vista's new features. But the makers say that Vista is here to stay, whether a buyer is upgrading tomorrow or next year.

"Vista will become the new standard. The only question will be which version of Vista you want--are you a gamer, a writer, someone who does 3D design work or digital video?" said Ken Walker, chief technologist for Gateway.

"You will be hard-pressed after [this] week to find an XP system available on store shelves," though Gateway will continue to sell the old OS through its online store, Walker said.

Gateway's designers used the Vista launch as an opportunity to make more changes than just the necessary graphics and memory upgrades, Walker said. They also switched from Intel's BTX desktop motherboard design to the more common ATX, and moved from a USB 1.0 to a high-speed 2.0 data port. Gateway, which also has a Web page devoted to Vista, will support Vista on its DX430 desktops, NX270S notebooks, and eMachines Q1 line.

XP-Based Systems in the Bargain Basement
Indeed, retailers like Micro Electronics' Micro Center offered deep discounts for Windows XP-based PCs from Acer, HP, and Toshiba over the weekend, granting $150 rebates in an effort to clear the outmoded notebooks off their shelves. The stores also plan to stay open between 12:01 a.m. tonight and 1 a.m. tomorrow to accommodate eager buyers.

[Rasputin]

Another Spammer Goes Down

An Internet-based provider of sexually explicit entertainment has agreed to pay a $465,000 civil penalty for sending unwanted e-mail, the U.S. Federal Trade Commission announced Tuesday.

The settlement with TJ Web Productions is the fifth after the FTC announced a crackdown on sexually explicit e-mail spam in July 2005, when the agency charged seven companies with violating a U.S. law requiring warning labels on sexually explicit e-mail. Sexually explicit e-mails sent by TJ Web affiliates have been "widely distributed" since May 2004, according to an FTC complaint.

Including the TJ Web settlement, the FTC has collected more than $1.6 million in civil penalties from the five companies, the FTC said.

The FTC's Adult Labeling Rule and the CAN-SPAM Act, passed by Congress in late 2003, require commercial e-mailers of sexually explicit material to use the phrase, "sexually explicit," in the subject line, and to ensure that the initially viewable area of the message does not contain graphic sexual images. The rule and the law also require that unsolicited commercial e-mail give recipients a way to opt out of receiving future e-mail and provide a postal address.

Details of Settlement
Under the proposed settlement, TJ Web is permanently prohibited from violating the FTC's Adult Labeling Rule. The company also is permanently prohibited from violating the CAN-SPAM Act by initiating commercial e-mail without clearly and conspicuously displaying a physical postal address without also including an opt-out mechanism.

TJ Web, based in Henderson, Nevada, did not send e-mail directly to consumers, but it operated an affiliate marketing program and paid others to send e-mail on its behalf, the FTC said. TJ Web operates "dozens" of adult Web sites containing sexually explicit photographs and videos, according to the FTC complaint.

The proposed settlement, which requires court approval, also forces TJ Web to obtain agreement from affiliates that they will comply with the terms of the court order.

Although TJ Web has a Web site, there is no contact information listed nor does the company have a published telephone number, so no one there could be reached for comment.

[Rasputin]

Microsoft Tailors Vista to Meet EU Requirements

As Windows Vista appeared in computer stores worldwide, Microsoft said today that part of the design of the new operating system is the work of the European Commission.

"Following discussions with European Commission, Microsoft committed to make a number of changes to the Windows Vista operating system prior to release," the software maker said in a statement, pointing to three functions of the operating system: security, search, and fixed document formats.

Default Search Settings Changed, New APIs
Windows Security Center, which looks like a dashboard, gives the user an overview of what security software is running on the system and the status of checks and upgrades of firewalls and antispyware protection.

Rival security software firms and the European Commission suspected this could give WSC an unfair advantage. Microsoft said it agreed to develop a new set of application programming interfaces for release in the first service pack, scheduled for later this year, which can be invoked by third-party security programs to turn off the alerts presented by WSC.

Similarly, PatchGuard--software that protects against the modification of the operating system kernel--has been added to Vista. Some security vendors have in the past made modifications to the kernel as part of the implementation of their security software.

PatchGuard prevents such modifications in the 64-bit version. Microsoft is now working with vendors to develop new kernel-level APIs that will provide access to the kernel to address this issue, Microsoft said.

The APIs will be available in Windows Vista 64 with the first service pack, scheduled for later this year.

Regarding search, Microsoft has changed the way default settings are made for Internet search within both Windows Vista and Internet Explorer 7.

"These changes now ensure for users that they are able--through a series of windows and options--to make a clear, conscious, and open decision on their default search provider. Furthermore, users will retain at all times the ability to change this and all further defaults in the operating system at will," Microsoft said.

Changes Made to XPS Licensing
Microsoft's own fixed document format software is known as XPS. "In response to the Commission's concerns, the company has made fundamental changes to the licensing structure of the XPS fixed-format technology and has committed to submit the technology to an international standards body for adoption as an open industry standard," Microsoft said.

The XPS standard will be made available under licensing terms that do not exclude any industry or licensing model including the General Public License, it said.

"In response to Commissioner Kroes' letter of March 2006, Microsoft created a single application programming interface so that independent software developers can create applications to allow users to save documents in XPS or other formats, such as Adobe's PDF," Microsoft said.

Microsoft said it has also disclosed through a licensing program the relevant information to enable the implementation of XPS technology on competing client and server operating systems.

Microsoft has also responded to a further European Commission demand to submit XPS (as well as future extensions) to a standards setting body. Microsoft will submit XPS to the Ecma International.

Microsoft said it will also enable the implementation of XPS under an open-source business model (GPL) through use of a covenant not to sue--a model that Microsoft has applied to Web services and open XML document formats and that has, it said, "been welcomed by the Open Source community."