Among the many improvements offered by 10.4.7, one new feature isn't likely to be eagerly welcomed by users. One sharp-eyed blogger noticed that 10.4.7 has been phoning home to Apple, as often as twice within a seven-hour period. What is 10.4.7 so busy reporting? The answer is as confusing as it is seemingly innocuous:
You can now verify whether or not a Dashboard widget you downloaded is the same version as a widget featured on (www.apple.com) before installing it.
It seems that Apple added a process called "dashboardadvisoryd" that phones home for two widget-related URLs:
The first appears to be a public key or something. The second appears to be empty but its header values may convey something of interest to Apple’s client.
While the dashboard advisory process doesn't seem to be sending much personal information, it also can't be easily turned off, which sets a bad precedent.
Privacy is a touchy subject right now. In the United States, phone calls are being monitored, bank accounts are being monitored, and the recent firestorm over Windows Genuine Advantage shows that people are pretty fed up with it all. Is this really the best time for OS X to start contacting the mothership? If so, at least offer some features that are a reasonable tradeoff for the loss of privacy and let people opt-out, please! Really, how often have you laid in bed at night fretting that perhaps you downloaded a widget that was a different version from the one on Apple's site? If that's all this process is doing, it feels rather like killing a gnat with a bazooka (specifically, a bazooka that shoots bad PR in every direction).
Perhaps some of our readers have ideas on why Apple would solve this particular problem with a fairly controversial solution?
Intel Capital has been busy. We reported yesterday on their multimillion dollar investment in videogame advertising, but that amount is pocket change compared to the US$600 million Intel has just invested in Clearwire. The investment is the largest ever for Intel Capital, and it signals the company’s continued interest in the WiMAX-style technology pushed by Clearwire.
Who is Clearwire? The firm, headquartered up in Washington state, offers wireless Internet access based on the IEEE 802.16e-2005 standard, with plans to adopt full WiMAX compatibility when the technology finally gets up and running. They already operate networks along the West coast and in Texas, Florida, North Carolina, Denmark, and Mexico. Connection speeds top out at 1.5Mbps and the company says that monthly charges range from US$30 to US$37, with an additional five-spot a month for the modem rental.
Clearwire plans to use the massive cash infusion to help fund a nationwide build-out of its technology, hopefully getting a jump on more established telecommunications companies which have not yet fully committed to WiMAX deployments. Intel wants to push the technology anyway it can, since it hopes to be a major manufacturer of WiMAX chipsets. The first WiMAX laptop cards should be ready by the end of this year, and Intel has already announced plans to incorporate the new technology into its Centrino platform.
While Clearwire races to expand its reach, it faces competition from the established players in the industry. Rupert Murdoch of News Corp. has perhaps been most vocal about his interest in building a national WiMAX network in the US, a move that could suddenly secure the company a major role in Internet distribution (though such a move would have its own difficulties).
Given all the interest that now surrounds WiMAX, it looks like the long-delayed technology will at last get its day in the sun. If it turns out to offer reliable broadband speeds without also requiring a telephone line or cable TV connection, expect this to be a deeply disruptive technology over the next decade.
We all remember collecting giant stacks of “free” AOL CDs (and for the really old techies among us, free AOL floppy disks, which could at least be reformatted and used for something else). Now it turns out that AOL may be offering something else for free: access to their Internet service.
Those still on dial-up (yes, they are out there) will continue to pay a fee to use the AOL service. However, subscribers to the “AOL for Broadband” service, where you bring your own high-speed Internet connection to the party, will no longer have to pay subscription fees. The plan, which could see AOL losing up to US$2 billion in revenue from subscription fees, is intended to boost AOL’s numbers and ultimately the company’s advertising revenue. AOL hopes that up to 8 million of its existing dial-up customers will take advantage of the offer. An earlier attempt to move people from dial-up to broadband by increasing dial-up access prices met with limited success.
The proposed change comes at a crucial point for AOL. While the company still has an impressive number of subscribers, they are losing customers rapidly as broadband access becomes more widespread. In 2002, AOL had 26.5 million subscribers in the United States; by 2006 this figure was down to 18.6 million. AOL estimates that the company lost approximately 850,000 members in the first quarter of this year.
The plan to drop access charges from broadband essentially turns AOL from a subscription-based service to an advertising-supported one. While companies like Google and Yahoo have shown that you can make very good money from online advertising bundled with free content, it remains to be seen whether the corporate culture at AOL will adapt well to this change.
According to the Wall Street Journal, the new plan was proposed to top Time Warner executives by AOL CEO Jonathan Miller, in a meeting held last week in New York. Time Warner, which was “acquired” by AOL in a stunning stock swap deal in 2001, right before the dotcom crash, has been distancing itself from its AOL portion. AOL reported a colossal US$99 billion loss in 2002, and in response, Time Warner removed “AOL” from its name and removed Steve Case from his position as executive chairman. Case left the Time Warner board in 2005. The media giant has considered selling its AOL property many times before, but decided to partner with Google instead. It is likely that the partnership with the search engine company provided the impetus to move to an advertising-supported business model.
Electronics have long been recognized as a weak link when it comes to secure conversation. From bugs hidden in lampshades to phone taps to keystroke tracking software, electronics provide the easy path to monitoring and censoring communications. In no area is that so apparent, perhaps, as in text messaging, as some users around the globe are discovering the hard way.
Text messaging and the first level of censorship begins at the phone. While it’s certainly possible to enter any word using the alphabetic method in which a=2, b=2-2, c=2-2-2, d=3 and so on, it isn’t very convenient. This has led manufacturers to develop alternate systems like T9, which make it easier to enter common words. T9 works by using algorithms to determine what word a user is trying to enter. Punching 2-2-8 might default to "cat" for example, since that’s a common word which uses the letters associated with those numbers. It might also give you "bat" however, which is another logical guess based on the letters available through those keystrokes. Usually, a provision is made for selecting words other than the algorithm’s first guess.
Where things start to get hairy is when a user enters something like 3-8-2-5, which can spell either "dual" or a somewhat naughty word which you won’t find in your family newspaper. (Raise your hand if you aren’t looking at a phone right now. I thought so.) In that case, the manufacturer could design the phone to provide the second word as an alternate, or more likely, avoid it altogether. In a nation like the US, avoiding a word which some might find objectionable is a business decision that probably prevents some complaint letters. In other countries, it could be a government mandate, and the banned word might not be 3-8-2-5, but something like "liberty" or "Taiwan."
At first, that sounds inconvenient, yet relatively benign. After all, a user could still switch to alphabetic entry and write anything they want, right? Perhaps, but the second level of control involves monitoring and censoring the messages of users, as the Chinese government has been doing since the SARS outbreak of 2004. At that time, word about the SARS epidemic spread like wildfire despite very little coverage by the government-controlled press. Since realizing the informative power of mobile phones, Chinese authorities have monitored and filtered text messages as a matter of course.
The problem doesn’t begin or end with China. Security agencies in countries as diverse as Iran and Germany have been spotted responding to text messages regarding political leaders or outlawed ideologies. Much of this communication scanning is done with the compliance of the mobile phone providers, which simply consider it the price of doing business in various countries. We’ve seen this before, as in the case of Google and other portals filtering search results to suit local authorities.
The good news is that censoring communication continues to remain something of an arms race. While aficionados of such evil words as "Taiwan" or 3-8-2-5 might sometimes find themselves under scrutiny by the Powers That Be, there’s nothing to stop them from switching to slang which means the same thing. Taiwan might be referred to as "the neighbors," for instance, while 3-8-2-5 could be "frak."
The phone companies’ plans to roll out video services across the nation have been slowed by the need to negotiate individual contracts with most municipalities. AT&T for instance, hit a wall in talks with the Chicago suburb of Roselle, owing to the fact that AT&T neglected to mention that the new lines it wanted to lay would carry video. (AT&T has insisted that its new IPTV service is wholly different from cable television and forms a data service, not a video network.) Now Verizon has run into trouble of its own as it attempts to bring its fiber-optic FiOS service to Montgomery County, Maryland.
The county, located just outside of Washington, DC, has apparently demanded that Verizon reimburse county lawyers and consultants for their time spent on negotiations. This, among other issues, did not sit well with Verizon, which decided to drag the county to court. They plan to argue that the local government’s actions violate federal law. For their part, the county argues that Verizon simply won’t play by long-established rules that govern the cable industry. Chief Administrative Officer Bruce Romer said that the lawsuit “is evidence that Verizon is unwilling to play by the same rules that apply to their cable competitors.”
Verizon and AT&T are newcomers to the world of municipal video franchising, and both appear frustrated by the tedious nature of the negotiations. Imagine having to secure deals with every municipality or county across the nation in which you want to introduce a new video service. Not a pretty picture, is it? On the other hand, municipalities don’t want to sign away valuable access to rights-of-way without a little something in return (Montgomery County, for instance, wanted Verizon to set aside 65 channels for local public access programming).
The telecommunications companies aren’t opposed to sharing the money, exactly, but they don’t want different regulations and contracts in every county. AT&T’s strategy has been to offer municipalities a “memorandum of understanding” that guarantees them five percent of local revenues with no room for negotiation (Roselle did not like this approach). The companies would far prefer to negotiate at the state or federal level and secure uniform franchising agreements.
That wish may be coming true, as recent legislation looks ready to take the matter out of the hands of local authorities. While this approach will mean that cities have fewer options for regulating and negotiating with the telcos, it does mean that the companies can roll out their technology much faster and at lower cost. Whether this ultimately benefits consumers remains to be seen, but it’s not a bad idea in theory.
When IPTV and other new services are at last deployed, the challenge is convincing people to buy them. While cable television is a well-understood technology, IPTV is not. AT&T has taken the unusual step of previewing its service for small groups of consumers in San Antonio, where its U-verse IPTV system first launched. This approach, dubbed “Selling TV like Tupperware” by the Wall Street Journal, tries to convince customers to switch by inviting them into an upscale house and showing them side-by-side televisions, one with IPTV, the other with cable. The company is also seeking out neighborhood leaders who will host similar “TV parties” in their own homes.
Advertising has so saturated every facet of American life that it’s starting to lose potency—sort of like crack. And just like crack, long-term ad viewers need higher doses of the drug to achieve that elusive high. That’s the appeal (to advertisers, at least) of in-game advertising: it’s new, it’s fresh, and it just might make an impression on jaded eyeballs. In short, video game advertising has gone mainstream, and if you want proof, just follow the money.
Microsoft dropped a bundle to acquire market leader Massive a few months back, and now Intel has gone and purchased a piece of the advertising pie. The company recently invested a few million bucks in IGA, a firm that recently named Chris Deering, former president of Sony Entertainment Europe, to its board of directors. IGA now has partnerships with some of the largest tech firms in the market, industry insiders on the board, and US$17 million from a Series A round of venture capital funding.
Though the company is still not a household name, they’ve been mentioned before on Ars. At the beginning of this year, they were players in the dust-up over Subway ads in Counter-strike games, something that really steamed Valve (dreadful pun quite definitely intended), the game’s creator.
The intriguing thing about in-game advertising is that gamers don’t seem to mind. Though television viewers long ago found ways to avoid the siren song of commerce (the VCR, the mute button, TiVo), gamers often welcome the arrival of “name brands” in their digital worlds. What’s odd about this is that it seems to offer so little value to the customer. Consider the following statement from Intel’s Damien Callaghan, Strategic Investment Manager at Intel Capital. “The explosive growth of digital gaming is attracting millions of new users and is a key element of Intel’s vision for the Digital Home,” he said “IGA’s products enhance this opportunity by enabling game developers and publishers to earn additional revenue ensuring the continuation of a vibrant industry—an issue of importance to Intel and its customers.”
Note who’s left out of the equation: consumers. Basically, the gaming industry wants users to buy their products at retail and then watch constantly updated in-game ads. Unlike the TV model, which offers consumers a compelling free product in return for the advertising, the gaming industry offers nothing, not even a discount (though one could argue that games would be even more expensive without this extra revenue; whether this is true or not is a question for another day). Perhaps when the novelty of the practice wears off, gamers will be less tolerant of having their attention sold to advertisers. Or perhaps not; big-name ads lend a certain legitimacy to gaming that players seem to enjoy, which is good news to companies like IGA and to financial backers like Intel.
Electronic Arts has come a long way since its founding in 1982 by game pioneer Trip Hawkins. As of 2005, it had grown into the largest third-party game publisher, with revenues of over US$3 billion. The company grew rapidly through dominating the sports game market (including acquiring exclusive contracts with leagues such as the NFL), acquiring smaller studios, and obtaining licenses to popular IP such as the Harry Potter series.
While the company’s growth has been impressive, its recent stock performance has not. From a high of nearly US$70 in March 2005, the stock has dropped to its current value of US$42.81. To address the problem of underwater stock options, the company has proposed a new plan that will offer top executives additional shares and options. According to a proxy statement issued by the company, “underwater options may not be sufficiently effective as performance and retention incentives” and the company needs to “maintain competitive employee compensation and incentive programs that will assist us to motivate and retain our employees.”
The gaming industry in general has been suffering as sales have dropped off in anticipation of the next generation of console hardware. However, EA has had additional problems that have caused its stock prices to fall even more precipitously than rivals such as THQ and Activision. A combination of poor earnings results, layoffs, and settlements involving overworked staff have driven the stock down over the last year.
While the majority of these new stock rewards will go to upper management, EA has offered smaller stock programs for their rank-and-file employees for many years. When I worked there, even the lowliest peon was allowed to purchase a limited number of options at 75 percent of the current stock price. Even if the stock stayed flat, you could still make a small amount of money on this plan. If the stock continues its fall, however, employees currently under this plan will be in trouble.
The plan is subject to shareholder approval at EA’s annual meeting on July 27.
Research into the emotional and cognitive processes of other animals is a challenging thing, because you can't ask an animal what it's thinking at any given moment. Nevertheless, in recent years, evidence has piled up that indicates that many of the qualities once thought to be unique to humans, such as advanced planning and empathy for the needs of others exist in limited forms in other primates. Other works has found tentative indications that non-primates may share some of these traits.
The somewhat ambiguous evidence for empathy in non-primates are nicely summarized in a recent article that presents evidence that mice possess a specific form of empathy: they suffer when they see familiar mice in distress. The scientists subjected the mice to a painful procedure that caused a physical reaction, and placed a second mouse in a place where they could observe each other. Watching a mouse in pain was not enough to cause a physical response in a regular mouse, but when both mice were in pain, the response was significantly increased. This suggests that mice would have their display of distress enhanced by seeing others in distress.
By itself, that may not imply any emotional content, but the researchers also showed that familiarity with fellow mice enhanced the response even more: if mice had shared a cage prior to the procedure, they displayed even higher levels of pain-response behavior. A second protocol using a different trigger and resulting pain display showed that this form of empathy is not restricted to a single type of behavior. Mixing the stimuli, so that the two mice displayed different responses entirely, also confirmed the empathetic response.
The other result that stood out came when the mice were given two different doses of the pain stimulus. In these experiments, the effects averaged out: high dose animals responded less, while lower dosed mice acted as if they had received a slightly higher dose. Add it all up, and it looks like a mouse feels more distress when it sees another mouse in pain, and the situation is worse if it is familiar with that other mouse. The one thing the study wasn't able to detect was any display of distress in a mouse that wasn't subjected to pain, but it's possible that an examination of brain activity would reveal something that we can't detect by observation. All this, of course, would allow empathy to be assayed in the panel of mutant mice that are being developed, which we reported this morning.
Somewhere between journalism’s two worlds of “hard news” and “secondhand rumor” lies a third category: “your tax dollars at work.” These stories generally combine the veracity of real news with the craziness of watercooler gossip, making them especially tasty at the end of a long workday. To that end, let’s talk a little about the Defense Department’s interest in blogs.
Imagine yourself as a military planner for the US, someone charged with thinking about “information analysis” and “actionable information.” Where would you go to learn things that the world’s most expensive military does not already know? If you said “the blogosphere,” please consider a new career with the Air Force Office of Scientific Research, which is currently funding a US$450,000 study that attempts to mine blogs for “invaluable help in fighting the war of terror.”
How is this going to work? The study’s name is cryptic; it’s called an “Automated Ontologically-Based Link Analysis of International Web Logs for the Timely Discovery of Relevant and Credible Information” (“Ontologically-based”? Aren’t we all?). The three-year project will seek to separate the wheat from the chaff using a radical new approach to information processing: counting the number of hyperlinks that point to a source. As the press release points out, “Within blogs, hyperlinks act like reference citations in research papers thereby allowing someone to discover the most important events bloggers are writing about in just the same way that one can discover the most important papers in a field by finding which ones are the most cited in research papers.”
This Brand New Approach™, one with no similarities to that used by the world’s largest search engine, will help analysts learn what topics are most popular among bloggers. Basically a Google Trends focused on blogs, the research hopes to clue warfighters into topics that have not yet made it onto the military’s radar screen, things like the Danish cartoon controversy that outraged the Muslim world, which was discussed on the blogosphere before it made headline news. Had the US military known about the controversy earlier (perhaps through a hypothetical, full-time US government presence located in every capital city in the world; call it an “embassy,” perhaps), Denmark could have been bombed before the situation got so out of control. Or something.
Somewhere in the caves of Waziristan, Osama bin Laden quakes beneath his turban.
Creative Technology has not had a good year, what with lackluster sales, inventory write-offs, and the shadow of a Microsoft media player looming ever larger. It's no surprise then that CREAF has been trading at historic lows. What is surprising is that in the last month the stock has rebounded significantly, up 20 percent. Why? Because of a patent fight with Apple Computer—but not like you may think.
After suing Apple over the "Zen" patent, the patent awarded to Creative for its "invention" of the portable media player user interface, Creative has found itself countersued by Apple for infringement. Lawsuits are currently pending in Wisconsin, Texas, and California, as well as trade complaints filed with the U.S. International Trade Commission. In Wisconsin, an interesting part of the court record has been reported.
“The parties will remain open to the possibility of
settlement,'' they wrote in the joint report to the judge. “No
specific settlement discussions are planned.''
Apparently, the mere possibility of settlement talks has given a significant boost to CREAF on the NASDAQ. But how can Creative settling over a patent they own help the company? Sound card enthusiasts know. They will remember the patent battles between Creative Technology and Aureal Semiconductor, which Aureal ultimately won. Unfortunately, that victory bankrupted the company. With a market cap that is approximately one-hundredth that of Apple, Creative is likely remembering that history too.
While it might be delicious ironing for Apple to do unto Creative what Creative did to Aureal, it would be far better for Apple if they could end this fight now. A cross-licensing agreement with a token settlement is a better deal than the chance—no matter how small—of Creative winning in court. After that, the marketplace would likely decide the fate of Creative, and the result of that contest is far more predictable.