Expect more for 2006, Microsoft’s Bill Gates says

With files from Jim Jamieson
Province

As the massive Consumer Electronics show opened its doors to about 150,000 exhibitors in Las Vegas yesterday, the hottest rumour had fast-expanding Google Inc. set to unveil a Google-based PC with its own Operating System today — one that would compete with Microsoft’s Windows.

The annual personal technology showcase is the pre-eminent trade show of its kind in North America and offers a glimpse of the newest products and trends that will be seen in the marketplace this year.

In his traditional show-opening speech, Microsoft Corp. chairman Bill Gates offered his latest vision of the digital lifestyle but he downplayed the Google rumour.

“Whatever they announce, they announce,” he said. “They will obviously branch out beyond Internet search, but I think the expectations won’t live up to reality.”

Gates touted the growth and maturation of the so-called “digital lifestyle,” where consumers’ lives will more and more be immersed in a computer-chip environment.

“2005 was a very big year for the PC [personal computer], but 2006 will probably be even bigger. It’ll be a big year for the digital lifestyle,” Gates said.

The new digital environment, he said, has come about thanks to the widespread availability of high definition video, new partnerships and user-friendly products.

Besides the new Xbox 360 video game and multimedia entertainment system launched in December, Gates hyped Microsoft’s next-generation operating system, Windows Vista, expected this fall.

Windows Vista will feature faster interaction with tools such as the cellphone and office computer.

This interactivity, aimed at boosting work and entertainment capacities, is the result of partnerships.

Microsoft is building a search engine into the next version of its Windows operating system and creating links to online versions of popular programs.

Google runs the most-used search site and has expanded its services to include free instant messaging, e-mail, maps and online photos. Microsoft posted its slowest ever sales growth last fiscal year.

Meanwhile, the high definition wars continued as manufacturers of competing next-generation video formats — Blu-ray and HD DVD — announced products for the North American market.

Microsoft’s Xbox 360 game platform will later this year have an external drive to play HD DVDs, and Japanese electronics maker Toshiba Corp. said it will sell high-definition players that support its HD DVD format in the U.S. in March.

But rival Sony Corp. also said it will start selling players supporting Blu-ray disc in the U.S. this summer.

© The Vancouver Province 2006

Virus writers take advantage of a flaw in Microsoft’s operating systems

Gillian Shaw
Sun

Security specialists are scrambling to build defences against an attack over the Internet that could shut down networks as virus writers take advantage of a flaw in Microsoft’s operating systems.

At the same time, the Internet is being hit by a separate attack in which Nazi propaganda virus creators in Germany scheduled Jan. 5 — the 87th anniversary of a precursor to the Nazi party — to trigger a long-dormant virus that could already be residing in millions of computers around the world.

The combination could hit the Internet with what is almost the perfect cyber storm today, and while security specialists have been preparing their clients for a possible attack with fixes available to defend against the viruses, Microsoft’s patch for its operating systems won’t be released until next Tuesday.

Gregg Mastoras, a senior security analyst with Sophos, said his company has already seen 200 separate attacks exploiting the Windows vulnerability, and with several days left before Microsoft issues a fix for the problem, security specialists are bracing for even more.

“It absolutely has the potential to wreak a lot of havoc,” said Mastoras. “This is going to be more than likely a very significant week.

“This is one of those storms — I’m not sure if it will be a perfect storm, but it’s like a big wave where you’ll have to brace yourself and hopefully the wave will pass over and you’ll be okay.”

The Windows vulnerability prompted a Threat Condition 3 alert from Symantec, the company’s second-highest alert level, and the highest it has issued in almost two years. The vulnerability in the way Microsoft’s operating systems handle images in the Windows Metafile format means opening a malicious WMF file could trigger hostile code which could spread through websites, HTML e-mail, peer-to-peer file-sharing services, and instant messaging.

“We don’t get to pick and choose when these things hit,” said Dean Turner, senior manager at Symantec’s security response. “Consumers and enterprises have to be prepared for the worst-case scenarios.

“What we are seeing now is not a worst-case scenario, but it is a bad scenario. The Windows vulnerability is definitely critical.

“This is a serious vulnerability, and what makes it more serious is that we still have to wait for an official patch to be released Tuesday.”

Microsoft’s beta version of the patch was inadvertently posted on a website before being taken down, and unofficial patches have been released by people outside of Microsoft. The official, fully tested version is only slated for release on Tuesday, following Microsoft’s regular cycle of releasing patches on the second Tuesday of the month.

Derick Wong, senior security product manager for Microsoft Canada, said that still shrinks the patch process by several weeks and he said staff at the company’s Redmond, Wash., headquarters have been mobilized to work round the clock on a solution.

Microsoft isn’t the only company where security staffers are coming back from Christmas holidays to find a crisis. While the variant of the Sober virus being triggered Wednesday is not new, Randy Fougere, senior director of marketing for Fusepoint said some corporate and individuals computer systems must remain unprotected.

© The Vancouver Sun 2006

Jim Jamieson
Province

A Richmond wireless-communications company is hoping to ride the explosive growth of Internet-telephone service with an agreement to supply cordless phones specially designed to work with web wunderkind Skype.

The phones will be branded through major electronics firms.

Ascalade Communications Inc. [www.ascalade.com] has already begun shipping its first Skype-compatible phone in the U.S. and expects to see the product available in Canada in the next two months.

The wireless phone functions through a small device that plugs into the USB port of a computer that has a high-speed connection to the Internet. The phone allows users to make calls directly through Skype, and features a colour screen, caller ID and conference calling.

Skype has taken the Internet community by storm since its launch in 2003. It provides free, unlimited computer-to-computer voice and video calls worldwide to other Skype users.

For a fee, users can also make calls to traditional phone numbers (on land line or cellular).

Skype’s service is provided through Voice Over Internet Protocol (VoIP) technology, which industry analysts predict will eventually replace traditional land lines.

The Luxembourg-based company was purchased late last year for $2.6 billion US by online auctioneer EBay.

Ascalade president and CEO Edmund Ho said the deal, whose financial details were not revealed, is a major opportunity.

“We are building on our core competency in digital wireless,” he said. “We believe the market will change to VoIP. This is a step to move Ascalade into the future.”

Ascalade, which manufactures cordless phone products for major electronics players such as Philips, NEC and Toshiba, employs about 110 in its headquarters and research and development centre in Richmond.

All manufacturing is done in China, where 2,600 are employed.

– – –

FOR THE WEBWISE

What It Is: An Internet-based phone service that is free between Skype users and for-pay to or from traditional land-line or cellular users.

Founded: Mid-2003.

Growth: Currently has 70 million users, adds about 170,000 daily.

Starting: Download the free software [www.skype.com] and plug in your microphone-equipped headset.

© The Vancouver Province 2006

Province

NEW YORK — Microsoft Corp. plans to release a patch for a new security flaw at its next scheduled update release on Jan. 10, leaving users largely unprotected until then from a rapidly spreading computer-virus strain.

“Microsoft’s delay is inexcusable,” said Alan Paller, director of research at computer security group SANS Institute. “There’s no excuse other than incompetence and negligence.”

“It’s a problem that there’s no known solution from Microsoft,” said Alfred Huger, senior director of engineering at Symantec Corp.’s security response team.

SANS Institute, via its Internet Storm Center, has taken the unusual step of releasing its own patch for the problem until a Microsoft-approved fix is available.

The Internet Storm Center, which tracks viruses and other outbreaks on the web, increased the threat level to “yellow” — a warning that means a significant new threat is developing.

Microsoft said evaluation and testing affect the timing of security patches. “Creating security updates that effectively fix vulnerabilities is an extensive process. There are many factors that impact the length of time between the discovery of a vulnerability and the release of a security update,” Microsoft said.

“Quality is the gating factor,” said a Microsoft spokeswoman. The company views the issue as “serious,” but believes that “the scope of the attacks is not widespread,” she added.

The attack is the latest to hit Microsoft, despite redoubled efforts to respond to security threats. With more than 90 per cent of personal computers running Windows, it represents the biggest target for hackers.

The virus began spreading last week, as hackers took advantage of a previously unknown flaw in Windows Meta File code in what is known as a “zero-day attack.”

The bug was found in current server and desktop versions of Windows and is considered serious because it requires relatively minor user interaction to be unleashed. The virus is carried in picture files and can be triggered if an image is viewed in an e-mail or on an infected website. It is also being distributed through Instant Messenger.

© The Vancouver Province 2006

Quadruple play of TV, high-speed Net, land-line and mobile phone for 2006

Jim Ja
Province

Imagine you’re watching a fever-pitched hockey game on television and the Flames have just scored a soft goal on the Canucks.

Suddenly a text box opens on your TV screen. It’s your cousin from Calgary. “Flames rule!” says the text message. “Your goalie couldn’t stop a beachball.”

You have your own response, ready to type into wireless keyboard, but decide to wait until Naslund picks the top corner.

The preceding isn’t available yet, but Telus Corp. plans to include it soon in a TV service it has begun rolling out in Calgary and Edmonton and expects to offer in the Lower Mainland by mid-2006.

Telus vice-president of consumer product marketing Fred Di Blasio gave The Province a preview of the company’s long-awaited Telus TV product yesterday.

He said it would be price-competitive with TV services from cable company Shaw and satellite providers Bell ExpressVu and StarChoice, but will offer more flexibility and a wider range of services.

“What makes this so exciting is what you can do with an [Internet-based] infrastructure,” said Di Blasio. “It’s the ability to bring all those services together in one unit and provide all sorts of functionality.”

The current offering includes incoming call display on your TV screen, Video On Demand (VOD; $5 per movie), a multi-functional remote-control interface and the ability to display information such as weather or sports scores while watching regular programming in a split-screen format.

The 200-digital-channel lineup begins at $22 a month for a basic package of 23 channels as well as 45 music channels. Customers can add theme packs of certain types of content such as sports, news, entertainment, family or lifestyle at $6 a month for up to four packs and declining rates for more.

Telus also offers 43 other niche channels at $2 a month each.

Shaw, for example, charges $25 for its basic cable package of 36 analog channels.

Customers will need to purchase ($150) or lease ($10 a month) a set-top box to receive Telus TV, after a technician performs a free installation.

Telus TV doesn’t yet offer channels in high definition — as do Shaw and the satellite providers — but Di Blasio said it expects to launch HD content by mid-year.

Eventually, he said, Telus plans to offer bundles that combine the so-called quadruple play of TV, high-speed Internet, and land-line and mobile-phone service.

However, you’ll have to be patient because Telus is being very cautious not to repeat the less than smooth roll-out of its high-speed Internet service a few years ago. The demand was so high that Telus couldn’t build out its network fast enough.

“We want to make sure we do this right,” said Di Blasio.

Early in the New Year, Telus will begin a trial program with some employees. By mid-year it expects to begin offering the service to selected areas in the Lower Mainland.

© The Vancouver Province 2005

People who Christmas shop on the Internet need to protect themselves as criminals bump up their scams for the season

Peter Wilson
Sun

Better watch out, better not to pout when Santa Claus comes to the Internet this holiday season.

Now’s the time to learn how to protect yourself because jolly old St. Nick is sure to be accompanied by spams, scams, fake websites and even evil-twin wireless networks.

Last Christmas 3.5 million Canadian adults spent an average of $228 each on presents. And, as always at this time of year, Net nasties simultaneously bumped up their cash snatching schemes to match e-sales activity.

“It’s Christmas, so this is absolutely going to happen,” said senior analyst Gregg Mastoras of security firm Sophos Inc, which has a major spam lab in Vancouver. “Unfortunately, it’s a bit like clockwork.

“In 2004 we saw a tripling in the number of spams that were offering Rolex watches and other luxury goods,” said Mastoras. “So expect to see more spam offering that kind of thing.”

As well, said Mastoras, there will be a rise in what are called phishing attacks — especially e-mails containing fake offers of the likes of loans, credit cards, increases in credit card limits and lines of credit.

Phishing was estimated by Financial Insights to have cost global financial institutions at least $400 million U.S. in 2004.

Phishing, said Mastoras, takes on two aspects. The first is simply an e-mail that asks you to forward such information as passwords, identities and account numbers.

“The second sends you to a website that looks like the one that belongs to your bank or your credit card company. It’s going to ask you for information there.”

A recent e-mail, carrying the logo of the Royal Bank of Canada, said that there was a suspicion that the recipient’s account might have been “accessed by an unauthorized third party.”

The e-mail continued:

“We are asking you to immediately log in and report any unnoticed password changes, unauthorized withdrawals or deposits, and check your account profile to make sure no changes have been made.”

Clicking on to the link led to a website that was an exact duplicate of that of the Royal Bank. Once the user signed in, of course, the account number and the password would go straight to the phishers.

As well, there are false stores and the usual fraudulent eBay sites.

“Another thing is that you’ll see is a lot of people writing viruses, trojans and worms trying to take advantage of the holidays,” said Mastoras.

These will seem innocent enough, with subject lines like “Open me, holiday jingle” and “funny card.”

Last year at about this time the Zafi-D worm, which accounted for 16.7 per cent of all viruses reported to Sophos in the last 12 months, began appearing with such subjects as “Merry Christmas,” “Joyeux Noel,” and “Feliz Navidad.”

Some e-mails, perhaps appearing to come from an online bookstore, will ask people to “click here for your rebate” or offer some other enticement. And those who have recently shopped at the site represented in the e-mail may do just that.

“You click on them and the next thing you know is you’ve downloaded a virus,” said Mastoras.

This is a particularly dangerous problems because downloading viruses could lead to much bigger problems than the user’s computer being rendered inoperative.

“There are some viruses out there that if they do get into your system they actually do things so that they know, for example, when you’re typing in www.ebay.com and they’ll basically take that information and redirect you [to a fake site],” said Mastoras.

And, as with the sites that took advantage of Hurricane Katrina, there are certain to be others that pluck at your heart strings to give money to sites purporting to help the down and out and the homeless, said Mastoras.

Then there’s the chance, if you’re sitting in a coffee shop with a wireless connection that, if you don’t have protection in place, your hard drive could be available to someone else on the network or someone could be operating an evil-twin network that captures everything that you’re doing online, including paying for goods with your credit card.

All of this evildoing, and reports of the evildoing have tended to make Canadians nervous about buying things online and far more apprehensive than their counterparts in the United States.

“I think what we’re starting to see is a little bit of fear, which is causing people to wonder if they should do online shopping to begin with,” said Mastoras. “Maybe it’s gone a bit too far in pushing people away from using the Internet as a tool.”

And Mastoras looks to be correct. A recent survey, conducted for the Canadian Alliance Against Software Theft, showed that 40 per cent of Canadians will back away from cyber shopping this Christmas because of their fears about a lack of Internet security.

That figure compares with just 24 per cent of those with Internet access in the U.S. who say they’ll be avoiding online shopping for security reasons.

Of those Canadians who do shop online there are some who do so despite being worried, because 88 per cent of us say we feel some Internet retailers haven’t done enough to protect their online customers.

Strangely, it’s not that Canadians aren’t doing anything to protect themselves.

Ninety-six per cent of survey respondents said they believe it’s important to protect themselves online and 68 per cent said they have at least three to five security software products on their computers.

Anti-virus software leads the way at 85 per cent, followed by firewalls used by 67 per cent of Canadians , e-mail filtering by 64 per cent and anti-spyware software at 60 per cent. Just 33 per cent report they have Web content filtering or blocking software.

That sounds impressive, but the survey, conducted by Forrester Research, also showed that a huge 81 per cent of Canadians aren’t confident in their own ability to protect themselves from losing information to an online threat.

And 74 per cent say they’re not confident they can protect themselves against unsolicited e-mail or spam.

And that could be because, although people like the convenience of computers and the Internet, when it comes to their inner workings they’re just not sure of what to do.

“Most people focus on the functionality and the features of their computer,” said Simon Tang of the consulting firm Deloitte, which provided much of the security information in the accompanying story.

“If it’s working, then why touch it.”

But to really combat this, people need to develop a real sense of online awareness, said Tang.

“Most, if not all, banks have come on and said that they would never ask someone to send back their credit card information or their account numbers,” said Tang, Toronto-based senior manager of Deloitte’s security services practice. “So, if in doubt, always call the financial institution.”

Tang also warned about wireless networking problems in the home, considering that a lot of users never bother to turn on encryption on their wireless modems. This, he said, is especially a problem for those who have large houses and have used signal boosters to beef up their networks.

“Then you can send signals out up to a kilometer or two or more surrounding the radius of your house.”

A wireless security expert from California was recently in town for a security conference and made an interesting discovery.

Sheila Luskin, western regional manager for AirMagnet, said that while she was demonstrating her products in Vancouver she was approached by a British Columbia retailer who had discovered a hacker outside a store, wirelessly collecting credit card information on purchasers.

“I think that Canada is more lax with security and I think that’s why people are concerned,” said Luskin.

SAFE HOLIDAY SHOPPING:

Tips from Deloitte on safe online shopping during the holiday period:

– Make sure the firewall and anti-virus software on your computer are updated and running. Scan the computer to detect any malicious programs (Trojan horses, spyware) that may have been planted to disclose sensitive information or to misdirect you to a fraudulent website.

– Verify that your browser has the latest security upgrades and that it supports 128-bit encryption. Your browser’s encryption level can be found in the tools menu under the “about” option.

– Make sure your wireless network has strong wireless security and controls built in such as wired equivalent privacy (WEP) or Wi-Fi protected access (WPA).

– Never respond to e-mails requesting that you log into a shopping-financial transaction website, claiming that your login credentials need updating or that your account is in arrears.

– Type in the URLs of websites that interest you and avoid clicking on those sent in an e-mail link.

– Confirm any online seller’s physical address and phone number in case you have questions or problems.

– Never send your financial information via e-mail because it is not secure.

– If you want to send your financial information through a website, look for indicators that the sight is secure, like a lock icon on the browser’s status bar or an URL that begins with https: (the “s” stands for secure. However, be careful, no indicator is foolproof.

– Don’t open e-mail attachments, even if it seems to have come from a friend or co-worker, unless you are expecting it or know what it contains.

– Consider shopping at sites that offer strong encryption (128-bit vs. 40-bit). You can find out the level of encryption by clicking on the lock item in the browser’s status bar.

– Avoid opting for the “remember password and user name” option. Although this can be a convenience, anyone who uses your computer can then gain access to your account and personal information.

– Print and save records of all your online transactions, including the product description and price, the online receipt and copies of correspondence with the seller. Read your credit card statements as you receive them and be on the lookout for unauthorized charges.

Edited tips based on information provided by Deloitte’s security services group.

PHISH OR CUT BAIT:

How to avoid the costly hook of phishing:

– Be suspicious of any e-mail with urgent requests for personal financial information.

– Unless the e-mail is digitally signed, you can’t be sure it wasn’t forged or “spoofed.”

– Phishers typically include upsetting or exciting (but false) statements in their e-mails to get people to react immediately.

– They typically ask for information such as user names, passwords, credit card numbers, social security numbers, etc.

– Phisher e-mails are typically NOT personalized, while valid messages from your bank or e-commerce company generally are.

– Don’t use the links in an e-mail to get to any web page, if you suspect the message might not be authentic.

– Instead, call the company on the telephone, or log on to the website directly by typing in the Web address in your browser.

– Avoid filling out forms in e-mail messages that ask for personal financial information.

– You should only communicate information such as credit card numbers or account information via a secure website or the telephone.

– Always ensure that you’re using a secure website when submitting credit card or other sensitive information via your Web browser.

– Regularly log into your online accounts:

– Don’t leave it for as long as a month before you check each account.

– Ensure that your browser is up to date and security patches applied.

Edited version of suggestions by the Anti Phishing Working Group at www.antiphishing. org

© The Vancouver Sun 2005

Traditional phone and cable companies battle it out for business as they offer more services in common

Gillian Shaw
Sun

The latest skirmish in the war to win the eyes and wallets of today’s digital consumer has come with the soft rollout of Telus’s new digital television service that has the traditional phone company taking on Shaw Communications in its core business.

The move comes after Shaw started poaching phone customers with its voice-over-Internet telephone service in parts of Alberta and Victoria.

This week’s announcement has Telus looking to sign up TV viewers, starting with Calgary and Edmonton and rolling out to B.C. by next fall.

At a time when the lines are blurring among traditional phone companies and cable TV firms, as they all fight to be the one-stop source for consumers’ entertainment and telecommunications dollars, Telus is taking a lead by turning your television into yet another Internet device.

At stake — depending on the latest estimate — is the more than $250 a month that household are shelling out for a smorgasbord of communications and entertainment offerings.

In a demonstration of the new Telus TV service at Telus‘ downtown centre in Vancouver Tuesday, Fred Di Blasio, Telus‘ vice-president of consumer product marketing, pointed to the IP connection as the differentiator the company expects will sell its new TV service.

First thing you’ll notice is the telephone alert. It flashes a caller ID on your TV screen so you can decide whether it’s worth taking the call.

“It is all digital,” Di Blasio said of the new TV service which is being rolled out gradually as Telus upgrades its subscriber lines to deliver the capacity Internet-protocol-based television demands. “It gives it a really crisp picture and a whole host of truly amazing features.”

On Telus TV, viewers will be able to set up a customized list of their preferred programs, much like their favourites list in their computer Web browser. The pre-school set will be able to hit a button on the handheld controller and find out every kid’s program that’s on at any given time. Likewise, sports aficionados can find out what games are playing in the categories’ listings that offer just one way of finding something to watch.

Worried about missing Survivor, or wondering when the next OC is up? Your television will text message you a timely reminder so if you’re in the middle of a meeting, or at the grocery checkout, you can drop everything to race back and catch your show.

If you run out of shows that pique your interest, the new service brings you video on demand — a digital version of your local movie rental shop where you can pay five bucks for a movie that will be available for viewing anytime over 24 hours and won’t sting you for a late fee if you forget that you have it.

Parents can guard their children’s viewing habits and at the same time their escalating television bill by blocking channel or rating programs they don’t want their kids to see and a password protecting access to such added cost features as video on demand.

Di Blasio said there are currently more than 300 movie titles available through VOD, but he said that number is constantly increasing.

“It just like watching a DVD, you can stop it, rewind or turn if off and come back later,” Di Blasio said.

In another nod to customizing for consumers, the service will shop around the networks if your favourite show isn’t playing at a convenient time and pick it up from another time zone if that works for your schedule.

A recording feature, now offered by Shaw at close to $600 in its high definition and personal video recorders, is not on the menu yet for Telus TV, but Di Blasio said the company is talking to vendors with a view to adding that capability in the future.

The pop up phone alert has been a hit in Alberta, according to Di Blasio.

“It’s a wonderful little bit of technology that people have glommed on to and they really like it,” he said.

Telus has made its customized ‘my Telus channel,’ a changeable entry page similar to its personalized ‘mytelus‘ Web site. For younger age groups, accustomed to a busy screen demanding heavy multi-tasking, it combines a live Internet feed with a TV window and various other features like text messaging. For the grandmother who sees it as just too much information, the screen can be simplified with the video feed taking over more screen space.

“You can personalize it to your neighbourhood so you can make reservations, order pizza,” said Di Blasio. “That is the unique advantage of having an IP network.

“In an IP environment your imagination is the only thing that stops you.”

The service requires a user to have Telus‘ high-speed DSL (digital subscriber line) Internet service, which costs about $30 a month and comes in various packages and options, starting at $22 for the most basic ‘essentials,’ version. Channels can be added in packs or at $2 a pop per month and the price of movies drops from its one-off $5 per video to four-packs as low as $10 when they’re included in a higher priced bundle.

Currently Telus TV offers more than 200 channels. High definition television is not yet available with the service but Telus promises that will come when more high definition programming becomes available.

The service works with conventional televisions but each TV requires it own Telus TV box that has to be wired in by a Telus technician. Like the modems that come with Telus‘ Internet service, pricing on the boxes depends on the length of the service contract. Signing a contract, anywhere from one to three years, gets you two free Telus TV boxes with their remote controls.

If you choose the month-to-month option, you can buy the boxes for $150 or rent them for $10 a month. Although the service is delivered through the same phone line that brings DSL and landline service to your house, it doesn’t interfere with those services.

TELUS TV:

Here is Telus‘ TV pricing, not including the telecom’s high-speed Internet service, which averages about $30 a month:

– Essentials: $22 a month

Includes 24 basic channels, from ABC to CBC along with 45 audio music channels and local radio stations, myTELUS and video on demand.

– Five Theme Packs: $25 a month

Includes a range of selections from Time Choice, Sports, Family, News and Lifestyle

– Combo 1: Essentials with five theme packs for a total of $47 a month

– Combo 2: Essentials, with five theme packs at $25 a month and a movie four pack for $14 for a total of $61 a month

– Combo 3: Essentials, with 10 theme packs for $45 and a movie four pack for $10 for a total of $77.

– Telus TV box with controller: Two per customer come free with contracts of one to three years; otherwise you can buy the box — one is needed for each television — for $150 or rent it for $10 a month.

– Individual channels: $2 per month.

© The Vancouver Sun 2005

Company says it’s looking like an incredibly successful Christmas, which accounts for 55% of sales

Marke Andrews
Sun

Richmond-based Nintendo Canada is enjoying strong Christmas sales of both hardware and software, despite the launch of the sophisticated Microsoft Xbox 360 console in late November.

“It’s looking like an incredibly successful Christmas, especially for Nintendo DS,” says Pierre Trepanier, marketing director of Nintendo of Canada, who said 55 per cent of the company’s sales are made over the Christmas shopping season.

Trepanier says Nintendo hasn’t really felt the effects of the Xbox 360 launch.

“They are completely different markets,” says Trepanier. “When you’re spending a thousand bucks for a new system, you’re in a very different segment than people buying GameBoy. You can get a GameBoy and game for $100.”

Trepanier’s figures are somewhat exaggerated. Microsoft released the Xbox 360 on Nov. 22, selling the premium model for $499, and the core model for $399. The less-expensive core model requires a 20-gigabyte hard drive, which sells for $130. Microsoft projects sales of 2.75 million to three million consoles by late February.

By comparison, both the GameBoy and the GameCube console, which is not a portable, sell in the $100 range. The GameBoy Micro, launched in September, sells for $129 and the Nintendo DS goes for $169.

Since launching the GameBoy player in 1989, Nintendo has been head of the hand-held pack, withstanding challenges from a score of portable players, including Nokia’s N-Gage. The biggest challenge has come from the Sony PlayStation Portable, which launched in Japan last December, and in North America in March.

In sales of hand-held games units in Canada, PSP is third to GameBoy Advance and Nintendo DS, a dual-screen player which Nintendo launched last November and has sold 8.8 million units worldwide in 12 months. From October, 2004, to September, 2005, GameBoy Advance’s sales in Canada were 427,780, Nintendo DS sold 119,069 and PlayStation Portable sold 109,224.

GameBoy, in its various forms, has sold more than 67.6 million units worldwide to date. GameBoy software sales exceed 280 million games sold.

Trepanier says the relatively low cost of Ninetendo players, and the variety of games available for all units, explains why they sell so well.

“The library of games for GameBoy is up over 800 games now,” says Trepanier, who claims Nintendo has “90 to 95 per cent” of the portable market.

Nintendo has had great success with the virtual-pet game Nintendogs, which is popular with girls as well as the traditional male games player. Many consumers who bought Nintendogs also bought portable machines to play them on, meaning they were just getting into video games.

“Games like that have the potential to expand the gaming population, and Nintendo has always focused on expanding the gaming population,” says Trepanier.

The company continues to produce new software. This week, Nintendo released Super Mario Strikers, a five-on-five soccer game with armed players, explosive goal-scoring and electrified fences that opposing players can be slammed into. Vancouver’s Next Level Games developed Super Mario Strikers for the Nintendo GameCube.

Nintendo of Canada has donated 150 copies of the new game to children’s hospitals across Canada.

Nintendo recently announced that purchasers of next year’s new Revolution game machine, which still does not have a release date, will be able to get a password-controlled play control system, whereby parents buying the unit for their children can block them from playing games meant for older gamers.

The system rates games in four categories: E for Everyone; E10+ for 10 and Older; T for Teen; and M for Mature.

Meanwhile, Vancouver games studios Radical Entertainment and Electronic Arts Canada are counting on big sales from their games.

Kelly Zmak, COO and senior vice president of product development for Radical Entertainment, said both Crash Tag Team Racing, released two weeks ago, and Hulk: Ultimate Destruction, released in October, “are doing very well in the marketplace,” although he would not give numbers of units sold or shipped..

Trudy Muller of Electronic Arts expects Need for Speed Most Wanted, which is available for 11 games platforms, to be a good seller, in addition to The Sims 2, FIFA 06. NHL 06 (in Canada) and Madden NFL 06 (in the U.S.).

 

© The Vancouver Sun 2005

Telus taking it slow to ensure it’s done right

Paul Marck
Sun

Television, your future is calling — by phone. After years of planning and testing, Telus TV is finally bringing TV to viewers over phone lines in Alberta and B.C., using technology developed in Edmonton.

However, if you want to sign up for Telus TV in the Lower Mainland, you’ll have to wait for a phone call or an invitation in regular mail from Telus.

In other words, don’t call them, they’ll call you,

There’s a simple reason for the many delays in launching the new service, says Fred Di Blasio, Telus’s vice-president of consumer product marketing.

“We wanted to make sure we got it right,” said Di Blasio, a Montreal native and former executive with AT&T in New York and at Britain’s Cable & Wireless.

Now a quiet rollout is offering an alternative to cable and satellite TV in selected neighbourhoods in Edmonton, Calgary and the Lower Mainland.

“We have to upgrade our customers to six or seven megabits [per second] on their lines before they can get it,” Jim Johannsson, Telus service development director, said of the B.C. rollout. “Generally, most customers have just under two megabits now.

“So, when it’s available in the neighbourhood, we’ll contact them and give them the materials and pitch them the offer.”

Telus gave The Journal an exclusive preview of its new TV service, which operates on its ADSL high-speed Internet network and runs into customer homes on existing copper telephone wire.

What consumers will get, some of which is different from standard cable, is an Internet-based digital service, with video on demand, telephone call display on their TV screens and a host of special features such as program reminders.

They’re all displayed in an on-screen menu that has interactive features similar to those of a computer.

Initially, Telus TV, which uses Internet bandwidth, can connect to a maximum two TVs per household, in addition to telephone and Internet service. Telus promises that will go up to three sets per home after the company upgrades to the next-generation ADSL2+ network sometime over the next couple of years.

Telus is making a low-key launch of the new service through direct-mail advertising in neighbourhoods where it is available — a far cry from the lavish news conferences and wine receptions Shaw staged last year for the start of its telephone service.

It will take some time for network upgrades in Alberta and B.C.’s major cities before Telus TV is generally available, expected after next summer.

Johannsson said that Telus, which has been quietly offering its TV service for a month, doesn’t have the capacity to roll it out all at once.

“What’s hurting us is our experience with ADSL a few years ago. Everybody had to have ADSL and we couldn’t build it fast enough. “And we had people just frothing mad, because we couldn’t serve their neighbourhood quickly enough and we had customers on wait lists.”

Johannsson said this time, Telus wants to contact customers and then be able to come and install Telus TV and show them what it can do.

Telus TV’s programming ranges from Canadian and U.S. standards, to specialty sports, culture, movies, kids’ and adult entertainment and 45 commercial-free radio channels.

“You get unbelievable picture quality, with more than 200 digital channels,” Di Blasio said. “Plus you get choice, with video on demand; you get call display. It’s a plethora of different services that today no one else can match.

“It’s exciting and it’s leading edge. It is what I left the U.S. for,” said Di Blasio, who joined Telus 18 months ago.

While competitors package a TV offering with telephone and high-speed Internet, Telus said it is the first company in Canada to offer add-on features in a basic package.

In Alberta, it starts with a basic lineup of 24 channels for $22 a month. Customers can add theme “packs” of sports, entertainment, lifestyle, news and family choices at $6 a month for up to four packs and declining rates for more.

But unlike cable, Telus offers up to 44 individual channels at $2 a month each. Like cable, movie, feature, international and adult entertainment packages are available at from $8 to $20 a month. Video-on-demand movies are $5 each.

The TV project faced some big technical hurdles.

“The technology has not been around for 40 years, the way cable technology has,” Di Blasio said.

It started in the late 1990s, when 3,200 new homes in Edmonton and Calgary were built with special wiring for a possible new Telus TV product. But several years of testing concluded that TV couldn’t be delivered over standard, twisted-pair copper telephone wires.

The project was abandoned.

But as Internet technology became more refined, Telus took another stab at it. By 2002, the company had developed a special Internet infrastructure in Edmonton for media services.

Not only was the product developed there, the operations centre is in Telus’s downtown Edmonton Toll Building, where TV content from satellite and other sources is distributed to Telus customers in Alberta and B.C.

Quebec is to be added later.

With racks of file servers, banks of monitors and a central control desk, the set-up looks like something out of the Starship Enterprise. As insurance against potential power failures, all systems are backed up by batteries and there are gas turbines on the roof.

Telus won’t say how much it has spent bringing its TV offering to market, but indications are that it has been hundreds of millions since the late ’90s. Nor will the company say what kind of subscriber numbers it expects.

“I think with Telus you get a premium product, with differentiated elements to it. I think that’s a great deal for customers. That’s what they want, and that’s what we’re going to provide them with.”

The TV service is part of an overall consumer plan Telus calls the “Future-Friendly Home,” which is designed to integrate a growing number of products and services seamlessly into a customer’s life. What began with wireline phone service years ago has been augmented by DSL high-speed Internet, Internet home security and, now, TV.

Now, with an ugly four-month labour dispute behind it, Telus is ramping up. More product announcements are expected next year. It expects to hire up to 800 new staff in Alberta and B.C. over the next couple of years for customer service and installation to backstop its new TV offering.

“I think the company is viewed as a trendsetter in the industry,” Di Blasio said.

© The Vancouver Sun 2005

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