DEAL: Analysts say merger would be good for both firms

Province

SAN FRANCISCO — Internet search leader Google Inc. is in talks to acquire the popular online video site YouTube Inc. for about $1.6 billion US, The Wall Street Journal reported Friday, citing a person familiar with the matter.

Mountain View, Calif.-based Google and San Mateo, Calif.-based YouTube are still at a sensitive stage in the discussion, the newspaper reported.

The blog TechCrunch had reported on rumours of the acquisition talks. Google spokesman Jon Murchinson said the company “doesn’t comment on rumours and speculation.” YouTube officials didn’t return telephone calls.

Analysts said a Google acquisition of YouTube would make sense for both companies if the reported talks lead to a deal, especially considering Google’s $10 billion in cash on hand.

“It’s damn cheap for a company that already has a global presence,” said Trip Chowdhry, an analyst with the San Francisco-based Global Equities Research. “YouTube’s brand identity is no less than Google’s and is no less than Coke’s.”

As YouTube’s popularity continues to soar, she said, Google can help make sure the site’s infrastructure can keep pace.

The acquisition would also immediately propel Google to the top of the online video heap, an area where Google is lagging. YouTube eclipsed traffic on Google’s video site in February. By July, about 30.5 million people visited YouTube, compared with 9.3 million to Google Video and 5.3 million to Yahoo Inc.’s Yahoo Video, according to Nielsen/NetRatings.

YouTube users watch more that 100 million videos daily.

Google’s video service lets everyday users post clips, too. Unlike YouTube, Google also gives them the choice of selling videos. All YouTube clips are free.

YouTube was founded in February 2005 by three former employees of EBay Inc.’s PayPal electronic-payment unit.

© The Vancouver Province 2006

 

Lowell Conn
Sun

Delphi has a good thing going: Plenty of contracts to make profitable OEM equipment and a powerful foothold in entry-level satellite radio — after-market dominance by any measure. And, with the launch of the NAV200 GPS, the company seems destined to rise to the top of the navigation field. Feature-rich at a mind-blowing entry-level price, one can only rationalize that the NAV200 was intended to be a loss leader, subsidized by the zillions of dollars Delphi makes through other sector supremacy.

Chock full of MP3 and movie-playback modes, photo viewer, games, world clock, calculator and SD-card capability, it arrives pre-loaded with Canada and United States map data, all of which plays out on a bright 3.5-inch anti-glare LCD screen. It is easily among the most impressive low-cost GPS/entertainment hybrid systems on the market. Delphi is going to sell plenty of these puppies. $400; www. delphi.com.

MULTIMEDIA MACK

Mvix’s MV-5000U Multimedia Player is a consumer device fraught with existential angst. Is it an external hard drive capable of connecting to your home PC via USB and backing up important files? Or is it a portable entertainment device capable of playing a wide array of video and music formats? The sold-separately car kit seems to suggest this is meant to be an entertainment device capable of answering rush-hour boredom.

But the design and shape make it look more at home in your living room connected to both stereo and television. The car kit hardwires the device to your car stereo, but the MV-5000U already arrives with FM transmission. That makes one wonder whether the carkit is worth purchasing in the first place, not to mention whether this device even qualifies as a car product.

In fact, the only clear answer when it comes to the MV-5000U is that it is extremely cool. This, of course, makes up for all the ambiguity. $280; www.mvixusa.com.

© The Vancouver Sun 2006

Peter Wilson
Sun

Rogers Communications moved into the heart of Telus territory Thursday, with a declaration by one of its top executives that it’s out to grab small and medium business customers in the West.

“We’re signalling to the market here that Rogers is moving into the business area in a much more aggressive way,” Randy Reynolds, president of Rogers business solutions said during a visit to Vancouver.

“Our goal is to become the No. 1 alternative provider in Canada,” said Reynolds, who formerly headed Bell’s wireless operations.

“In the East, Bell may be first and we’d be the next provider, the number 1 alternative. In the West it would be the same thing, where Telus is first and we’d be the next guy.”

Reynolds said that while Rogers is primarily known to Canadians as a consumer-based wireless provider — with about 80 per cent of its revenues in that area — it now sees an opportunity to provide wired IP networks and local voice connectivity.

Small business customers in particular, said Reynolds, are ready for a change.

“The smaller the business customer, the less happy they are with the incumbent provider. And so we’re combining the strengths that we’ve had in the consumer market and we’re rolling out services to the business client, with a real focus in the small and medium segment.”

Although Rogers does have some well-known clients here — including BC Hydro, Vancity, TransLink and Ticketmaster — Reynolds admits that Rogers is not a name with huge business recognition in British Columbia.

“We don’t yet have the profile that we’d like to have,” said Reynolds. “One of my jobs is to figure out, working with the team here in B.C., how do we get that profile. We’re going gangbusters, winning a good percentage of the business that we bid on, but we’re still relatively small compared to Telus and Bell.”

As well, said Reynolds, he has to make it known to customers that Rogers, through its Sprint acquisition, has a cross-country business IT network that runs from Victoria to Newfoundland.

Rogers thinks it can score new customers when companies switch from ordinary wireline services to VoiP.

“We’re moving in now to try to find the customers that are changing their systems,” said Reynolds. “One of the things that’s happening in the market is that customers are changing at a fairly quick pace from the old style data networks to the new IP networks.

“So there’s an opportunity for us to get in there and become their networks provider.”

While pushing the business services, Reynolds also said that Rogers continues its innovation in the business market with its announcement this week that it has exclusive Canadian rights for a year to the new and highly hyped BlackBerry Pearl phone, aimed at those who want to get e-mails on the run, but don’t have a business connection.

“It’s really cost effective. You can get an e-mail pack on the Pearl for as low as $15 a month. And it’s designed to be easy to use.”

Reynolds said that since the Pearl was only introduced this week, he doesn’t yet have feedback from the retail level to know how its doing.

“But the hype is pretty hot, so I’m sure it’s going to be one of our big sellers.”

© The Vancouver Sun 2006

 

Rob Zoricic
Other

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Program checks to see if you are using your normal routines

Peter Wilson
Sun

A pleasant 10-second digital trip down memory lane could soon be the way your financial information — and your money — stays safe when you use Internet banking.

And that might be thanks to innovative security software called UNOMI (just sound it out) developed in Vancouver by recently launched, angel-funded start-up Cogneto Inc.

For example, you sign in and the site will ask you — based on information you supplied the first time you signed in — a series of questions about, say, that romantic trip you took to France four years ago.

How did you get there? Who did you go with? Where did you stay? Basically the who, what, when, where and why of it.

But UNOMI, to arrive at what Cogneto calls your “passthought,” rather than password, isn’t just looking for the correct answers.

It’s also tracking the way you use your mouse, the amount of hesitation between clicks, the speed with which you supply your answers.

It’s also looking at where you are as you do this. At your home computer? At the office? In Istanbul?

How are you connected? Over dial-up? With Shaw? On ADSL from Telus?

“It’s the same as if you were interviewing someone and you watch their body language, the tone of their voice, things like that,” said Cogneto’s chief technology officer, Patrick Audley, whose firm is headquartered in London, and financed with European money, but does its research and development in Vancouver.

And, said Audley, every person logging in has a unique profile.

“No matter whether it’s first thing in the morning and you’re a little muzzy in the head because you haven’t had your coffee yet or if it’s late at night, people respond the same way every time.”

Audley said people also tend to sign in at the same time of day from the same machine.

At the same time, from the banks’ end of things, UNOMI is assessing the general threat level that day.

Have there been a lot of failed sign-in attempts and is there a lot of strange activity going on in online banking generally?

Then the user gets a score, say a 90, or maybe a less reliable 75, and they are allowed on to the site and the various possibilities for moving money around, based on that score.

With a lower score, a client might not be able to send money to someone halfway across the world, but, however, be able to make normal credit card payments and transfer money between accounts.

“We don’t look at security from a pass/fail perspective,” said Audley. “We look at it in terms of risk, in the same way that humans make security decisions,

“So when we look at you we say, okay from the cognitive perspective you’re reacting exactly the same and from the way you’re moving the cursor it’s a little off, but we think that’s because you’re using a trackpad.”

And UNOMI, which learns more about you and your habits each time you log on, might also see that while you’re still in Vancouver, you’re signing in from a machine you don’t normally use.

“So we’re going to sign you in, but we’re going to assign you a slightly riskier score because you’re slightly off your normal behaviour.”

And if you want to know why you got a lower score UNOMI will say something like: ” You appear to be logged in from a public terminal. To improve your security you might consider logging in less frequently from public locations.”

Another advantage of UNOMI, said Audley, is that users don’t have to worry about getting their log-in information stolen.

“In fact, someone could steal the entire data base of all the log-in information and it wouldn’t help them to get into any of the accounts,” said Audley.

Audley said that the initial primary market targets for UNOMI are large financial institutions like banks, governments and large online e-commerce sites.

As for clients at present, Audley said: “I can’t discuss what we have on the table right now. We’re currently in proof-of-concept phase with two very large customers.”

© The Vancouver Sun 2006

 

Sun

An Ottawa company is developing a light bulb that can last two decades — yes, even if you use it. Group IV Semiconductor Inc. is being supported by EnCana and Sustainable Development Technology Canada in the design of the light bulb of the future. It would employ an electrical current passed through silicon semiconductors (instead of gases or filaments) with almost all of the energy involved producing light instead of heat. The solid-state lighting design would consume one-tenth of the energy of a regular bulb, using semiconductors to produce light instead of gases or filaments. The global lighting market is estimated at $12 billion annually.

© The Vancouver Sun 2006

 

USA Today

SEATTLE (Reuters) — Microsoft said Thursday its new Zune music player will be sold at a price matching Apple Computer’s market-leading iPod and, as a result, lose money this holiday season.

Microsoft’s 30-gigabyte Zune will retail for $249.99 — 99 cents higher than the iPod with the same amount of storage — when it goes on sale Nov. 14. Songs available for download at the Zune Marketplace service will cost about 99 cents a song, on par with prices at Apple’s iTunes, Microsoft said.

The world’s largest software maker faces an uphill climb in trying to topple the popular iPod after conceding a five-year head start to Apple’s media player.

The Zune aims to compete on features, not price, said an analyst. “They’re not getting into a pricing war,” said Michael Gartenberg, an analyst at technology and media research firm JupiterKagan Inc.

“It will be a competition of features versus features, form factor versus form factor, winning the hearts and minds of consumers with something other than price,” Gartenberg said.

Microsoft said it needed to put a comparable price on Zune, even if it meant that the company will suffer a loss from the device’s sales this holiday season.

“We had to look at what was in the market and offer a competitive price,” said Scott Erickson, Microsoft’s senior director of product marketing for Zune. “We’re not going to be profitable this holiday but the Zune project is a multiyear strategy.”

The Redmond, Washington-based software giant has said it plans to invest hundreds of millions of dollars to develop and market the Zune, and acknowledged the investment may take years to bear fruit.

The rectangular Zune media player has a round click wheel and is similar in appearance to the iPod, though slightly bulkier and has a larger 3-inch screen.

Unlike the iPod, Microsoft aims to attract users to the Zune’s ability to share photos and songs, on a limited basis, to one another.

Gartenberg said such features, although clearly different from Apple’s approach, has yet to garner consumer interest, based on Jupiter polls. About 11% of U.S. online consumers were interested in such legal file-sharing features, according to JupiterKagan research.

Interest rose to 18% in the younger 18 to 24 age group, Gartenberg said. “Because consumer interest is low, there needs to be some education in the market,” he said.

Shares in Microsoft, which hired Japanese electronics maker Toshiba Corp. to manufacture the Zune, rose 2 cents in early Nasdaq trade on Thursday to $27.46.

The music player is the first step in creating a new brand of portable devices, according to Microsoft officials, who also said a Zune phone is in the works.

Microsoft said it will sell a music subscription pass for $14.99 a month, allowing users to listen to any of the songs on Zune Marketplace. It pledges to offer 2 million-plus songs at launch. After the pass expires, users will not be able to access those songs.

For consumers looking to own a song, the Zune Marketplace will sell tracks for 79 Microsoft points. A user can buy 80 Microsoft points for $1 and points will also be redeemable at its online video game store, Xbox Live Marketplace.

Microsoft said it will initially sell only music — and no video — at the Zune Marketplace. The company said it was negotiating with major record companies and labels.

Each Zune device will come preloaded with an array of songs, music video, images and short films, Microsoft said.

 

The threat has shifted, says report by Symantec

Gillian Shaw
Sun

Home users are now the top target for Internet attackers, who are launching increasingly sophisticated attacks.

That’s the sobering warning from Symantec’s latest Internet security threat report, released today.

And those attacks can be triggered simply when someone visits a website, according to Symantec.

The attackers capitalize on successful computer break-ins by stealing confidential data such as banking passwords and also by using the captured machines — known as bots — to launch full- scale attacks against financial institutions and other lucrative targets.

From January to June 2006, the period of the report, home users attracted 86 per cent of targeted attacks, followed by financial institutions at 14 per cent.

In Canada, Symantec said Desjardins tops financial institutions for the number of phishing attacks against it, followed by RBC taking No. 2 spot, the Bank of Montreal at No. 3 and Toronto Dominion and CIBC at Nos. 4 and 5 respectively.

“The motivation is the same, but what is really starting to change is the way these guys are going after this information,” said Dean Turner, Symantec’s Calgary-based executive editor of the report. “In the past they were focused on networks and infrastructure vulnerabilities.

“They have shifted their focus to home users. Home users are the weakest link in the security chain.”

The cyber-fraud artists are finding a bonanza in exploiting software weaknesses, with Symantec recording 2,249 new vulnerabilities in the first six months of this year, up 18 per cent over the previous six months and the highest number ever recorded for a six-month period.

Vulnerabilities are glitches in software that can leave the computer open to unauthorized entry and tampering from outside, providing openings for such malicious software as Trojan horses and keystroke loggers to infiltrate computer systems.

In the first six months of 2006, 80 per cent of the vulnerabilities identified were considered easily exploitable, meaning Internet attackers would have little trouble in capitalizing on them to launch their attacks.

While Mozilla Web browsers had the most vulnerabilities at 47, compared with Windows Internet Explorer at 38, Microsoft’s IE had an average window of exposure of nine days, meaning it took that long between the time the vulnerability was identified and a fix issued for it. By comparison, Mozilla’s window of exposure was only one day.

Also, Turner said that with IE accounting for 83 per cent of the browser market, is it the most attacked browser software by far.

“What we are talking about is a move to more targeted attacks,” said Turner. “We are seeing much more sophisticated malicious code.”

Turner said there has been a shift to polymorphic viruses, viruses that change every time they replicate and infect a new machine in a way that makes it difficult for antivirus programs to track them.

China is the world leader in terms of the number of bot computers within its borders — 20 per cent of the 4.6 million bot computers active around the world at any one time are in that country. The bot computers are controlled by command and control servers, often in other countries.

© The Vancouver Sun 2006

 

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DIGITAL I Microsoft’s new Zune is a Christmas no-show

Peter Wilson
Sun

Microsoft’s highly hyped new Zune music and video player — complete with its own music download system — will soon be on the attack.

Also on the offensive are SanDisk’s just-announced Sansa e200, with yet another music download offering. Oh, and Samsung should soon be launching its own service for its own players.

And then there is the powerful Creative Zen W and even Disney’s new kiddie-oriented Mix Max.

Yes, it’s the annual — and so-far ineffective — attack on the hugely dominant Apple iPod. The player in its various forms had 64.2 per cent of the Canadian market in sales in the first six months of 2006 and also led in units sold at 44.5 per cent, according to NPD Group Canada. And, in case there was any doubt about the overall popularity of the digital player, the amount spent on them rose 40 per cent and the number of units were up 49 per cent.

Leading the latest digital charge in the MP3-video player wars is the Zune, which Microsoft hopes will reduce Apple’s sway over the lucrative market.

The Zune, made for Microsoft by Toshiba, will have 30 gigabytes of memory and a three-inch screen — which puts it ahead of the latest iPod’s 2.5-inch screen — and the ability to transfer songs wirelessly from one Zune to another.

Sounds interesting, except for one little niggling thing.

In Canada — where retailers are already getting inquiries from tune and video-hungry consumers — the Zune will be a no-show under the Christmas tree.

“The Zune will not be available in Canada for the holidays,” said Jason Osborne, Vancouver-based Best Buy Canada’s merchandising manager. “I can’t imagine us seeing anything before the second quarter of next year.”

The reason, said Osborne, who has had e-mail confirmation of this from Microsoft, is that the Zune is tied to its strategy of having its own download system, similar to Apple’s iTunes.

“There’s no Microsoft service provider in Canada for digital audio and video. And, honestly, we’ve been pushing them.”

Microsoft Canada representative Jason Anderson said in a statement issued to The Vancouver Sun: “The U.S. launch of Zune is scheduled for this holiday season. Microsoft is planning to introduce Zune to additional markets however we have no specific details around a Canadian launch to share at this time.”

And Samsung’s music service, through media provider MusicNet, will launch before Christmas, but only in the United Kingdom, Germany and France and then Asia.

But that doesn’t mean, said Osborne, that there’s not going to be a lot of excitement at Christmas with the arrival of other players, like the SanDisk Sansa

e200 — even if it can’t offer Canadians the planned pre-loading of 30 hours of music from the likes of Coldplay, Jay-Z and the Rolling Stones. (You only get those tunes for 30 days if you sign up with the Rhapsody music service from RealNetworks, which isn’t yet available in Canada.)

“Whether [the Sansa e200] comes with loaded content, it remains to be seen,” said Osborne, who said he didn’t expect the SanDisk player to arrive in Best Buy stores before late October or early November.

“And the price point they’re targeting in Canada, $329, is quite high for an eight-gigabyte video player, actually more than the new iPod 30 gig.”

SanDisk was fourth in the Canadian market with 4.9 per cent of dollar sales and 8.9 per cent of units sold.

But Apple’s iPod — that comes in several models including the Shuffle and the Nano — has stayed the dominant player here, even if it has a lower percentage of the market than in the U.S., where it took in a whopping 75.6 per cent of sales in the first three months of 2006.

And it intends to keep that place with its latest models, the flagship of which is the $399 80-gigabyte model capable of holding up to 20,000 songs, 25,000 photos or 100 hours of video, but not all at once. You’ll have to make your own selection.

As well, there’s a 30-gigabyte model for $299. The nano comes in two-, four- and eight-gigabyte models, starting at $169. Finally, there is the one-gigabyte shuffle at $89.

While some analysts have warned that the iPod might be slipping in terms of cachet, this has yet to show up in sales figures, as Apple always seems to have a new must-have model, just as the glamour of the old one wears out.

One of the advantages in the Canadian market for companies like Creative — which was in second place with 7.5 per cent of the dollars spent and 8.8 per cent of units sold — and its 30-gigabyte audio and video player the Zen W, is that there is a lot of downloading unconnected to services such as Canada’s own PureTracks and the iTunes Store.

“People get their music in other ways, whether it’s peer-to-peer or other non-traditional download sites,” said Osborne. “So the content is readily available for Canadian consumers without being forced to pay for it.”

The smaller digital player brands — among which are companies that are otherwise electronics giants like Sony, with six per cent of sales, and RCA, with 3.8 per cent of sales — always seem to struggle for market share.

“The challenge those companies have had, and I’ll be quite frank, is that they’re always reacting and not leading,” said Osborne. “And they’re spread so thin in terms of their product assortment that they’re often gun shy to put their focus on this category, because Apple has such a strong share.”

Osborne said that Canadian consumers have not yet been swept up in any kind of video mania when it comes to digital players.

“I think right now consumers are looking at video as a nice-to-have feature, as opposed to a necessity. Again, it comes back to the content and how readily available it is.

“If you’re going to do video, what type of video can you put on these players that’s viewable?”

Osborne said that based on his conversations with Best Buy workers, buyers are generally loading them with music videos and small clips rather than full-length movies. Still, there is a definite trend towards adding video capabilities, even on one-gigabyte flash players with screens that have one to 1.8-inch screens.

“By Christmas over half, if not 65 per cent, of the players will have video.”

Osborne said what Canadians look for in a digital player are style, capacity and then content.

And, he adds, there are two types of customers. Those who value the style of the player and only want to carry a small music collection with them. They buy flash memory based players. “And then you get into the audiophile who has this mass storage device that’s an ultimate media player that carries audio and video and photos with a 30 to 80 gigabyte capacity.”

Oh, and that Disney Mix Max we mentioned at the beginning. Well, it’s priced at $99 US, has a 2.2-inch colour screen and has the capacity of six hours of video or about 240 songs.

While you could download movies to it, Disney is hoping that, instead, you’ll use memory cards, at $19.99 each that will contain popular movies like High School Musical, Confessions of a Teenage Drama Queen and Lizzie McGuire.

© The Vancouver Sun 2006