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Week of August 5, 2001 News Archive

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Monday August 6, 2001 Top

Three Companies Readying New Pentium 4 Chipsets

The Pentium 4 could finally move into the mainstream with new chipsets that will let the processor use cheaper memory--but they aren't coming from Intel. Two Taiwanese chipset manufacturers are planning to beat Intel to the punch with their own new chipsets for Intel's Pentium 4 processor. Silicon Integrated Systems (SiS) and Via Technologies have rolled up the launch dates for the 645 and the P4X266 chipsets from September to mid-August, according to a report in Taiwan industry journal DigiTimes on Monday. Intel is releasing its 845 Pentium 4 chipset, which will be the first to support the SDRAM (synchronous dynamic RAM) memory standard, in September. Intel has been aggressively cutting Pentium 4 prices in an effort to push the chip into the mainstream and is expected to slash prices again on Aug. 26. But the new 845 chipset is also expected to be a major boost, since SDRAM memory is less expensive than the Rambus RDRAM memory now exclusively supported for Pentium 4. This should make for cheaper consumer systems. Both the SiS and the Via chipsets use DDR SDRAM, which falls between RDRAM and regular SDRAM in terms of price. Some motherboard suppliers are said to be looking to alternative chipset suppliers in case Intel cannot meet demand. However, SiS may not be able to launch its chipset production to full volumes until the end of the year, as the company completes debugging.

Analyst Don't Expect Windows XP to be Delayed

Microsoft is facing calls for the courts to block its upcoming Windows XP operating system because of competitive concerns, but political and legal issues make such a move unlikely, analysts say. Last month, Microsoft opponents stepped up pressure on the software giant, with Sen. Charles Schumer of New York saying the company should make Windows XP--the biggest update to the flagship product in six years--more open to rival software applications. Also, New York Attorney General Elliot Spitzer was said to be looking closely at the possibility of seeking a court order to block shipment of Windows XP, which is scheduled to launch on Oct. 25. Some Microsoft opponents say Windows XP should be stopped, arguing that by including new applications like instant messaging and a digital media player, the company is continuing the same tactics that sparked an antitrust suit against it by the U.S. Justice Department and 18 states.

That case centers on how Microsoft bundled its Internet Explorer Web browser into Windows 95 as it battled upstart Netscape for supremacy in software that enables people to easily view the Internet. So some have said sales of Windows XP should be stopped until the tying issue has been resolved. "There exists a worry that AOL (or the states on the company's behalf) will ask for an injunction of Win XP," Lehman Brothers analyst Michael Stanek wrote in a research note last week. But such an attempt to delay the launch of Windows XP is unlikely to succeed, analysts said. First, there are legal grounds that set a high bar for such a measure. Second, there are political reasons that boil down to the fact that for every opponent trying to trip Microsoft up, there is an ally throwing its weight behind the company. In a report issued Monday, Brendan Barnicle, a former lawyer who is now an analyst with Pacific Crest Securities, said any injunction against Windows XP would require showing that the product would inflict irreparable damage on competitors.

"It is highly unlikely for a couple of different reasons," Barnicle told Reuters. "The standard for giving an injunction is very difficult. The courts are loath to give injunctions and instead favor monetary damages." Moreover, while the browser was once viewed as a possible alternative to the Windows operating system, the new products aren't seen as threatening Windows, just Microsoft's ability to be a high-profile player in the next era of Internet services. "In the end we believe the attempts by the states to enjoin Windows XP will fail, as these injunctions are rarely ever granted. Their contentions are not at the heart of the case," Stanek said. The court would also have to weigh what impact halting Windows XP in its tracks would have on Microsoft and the public, Barnicle said.

Open Source .Net May Have Patent Issues

Seasoned open-source code developers are concerned that an effort to produce an open-source alternative to Microsoft's .Net development platform may be held hostage by the software giant, if the endeavor ever gets off the ground. Open-source critics of Microsoft said the company would have the opportunity to strangle an open-source project by demanding a licensing fee and royalty payments each time an open-source version of its patent was implemented. They fear developers will flock to the new initiative, code-named Project Mono, only to find themselves trapped in payments to Microsoft later. A requirement for a volunteer developer group to pay license fees or royalties would be enough to end many open source projects, its advocates said. The .Net set of technologies, due late this year, interests developers because it offers to let a variety of languages work together in building Internet applications. But some say pieces of .Net could contain Microsoft patents. One patent is believed to underlie Windows' file transfer protocol, which will probably be used in .Net. The patent covers only the encryption procedures for how a user password is changed, but as part of the transfer protocol, it is a potential dependency for all developers who have to mimic the Windows file system and seek to interoperate with it. For example, successful interoperation with Samba might make the Samba project subject to Microsoft demands for patent licenses and royalties.

"The real danger is that there are hidden patents" on .Net technologies, said Eric Allman, chief technology officer of Sendmail and the original author of the dominant message transfer agent software on the Internet. Developers who use .Net may be subject at any time to demands for royalties. A patent owner that declines to issue a license may also go to court and ask for an injunction against the further use of its technology, said Tim Cahn, an attorney of Legal Strategies Group, an Internet law firm in Emeryville, Calif. Jan van den Beld, secretary general of ECMA, the European body that is overseeing efforts to fashion .Net specifications into an international standard, said Microsoft does not have to disclose any patents on .Net technologies, unless it is not willing to license them in a nondiscriminatory fashion. Most parties with patents are not required to disclose them in the standards setting process, van den Beld said. When Craig Mundie, Microsoft's senior vice president of advanced strategies, was questioned on the patent issue before the O'Reilly Open Source Conference in San Diego July 26, he said only that Microsoft would abide by the rules and procedures of ECMA on any patents that apply to .Net.

Future Sun Processor Will be Dual Mode

Sun Microsystems has only just started delivering its UltraSparc III processor, but already the company is touting the split-personality of its upcoming UltraSparc V chip. The UltraSparc V will be able to switch between two different modes depending on the type of work the computer is doing, said David Yen, general manager of Sun's processor group. One mode will be good for heavy-duty calculations, the other for business transactions such as recording or retrieving information in a database. "We'll have architecture that will explore instruction-level parallelism, like the Intel Itanium, and we will also explore thread-level parallelism, like the IBM Power4," he said. "But instead of having two separate chips, we'll design the chip so we have the ability to switch through software to support either of the workloads." With instruction-level parallelism, a chip sorts different types of instructions into several parallel "pipelines" that do their work simultaneously, explained Insight 64 analyst Nathan Brookwood. With the newer concept of thread-level parallelism, or symmetrical multithreading, several different computing tasks can work their way through a single pipeline at the same time.

"To the extent they go and do instruction-level parallelism and symmetrical multithreading in one fell swoop, that's a lot to bite off," Brookwood said. "There are some technical folks who would say it's better to do one big piece of technology at a time." The dual-personality approach will give the UltraSparc V relatively large dimensions, but because much of the chip will be used in either mode, the size penalty probably won't be severe, said Mercury Research analyst Dean McCarron. Chip size is critical because it has a direct bearing on how much it costs to make a chip, how much power the chip consumes and how much heat it gives off. Because Sun plans to use software to figure out which mode the chip operates in, "you wouldn't necessarily have to have a duplication of hardware," McCarron said. "Basically you're just deciding how best to allocate the execution units of the processor among the instruction streams coming in."

Maxtor Releases First USB 2.0 Hard Drive

Maxtor Corp. today announced a more convenient upgrade path for adding storage to existing PC and Macintosh computers: the new Maxtor Personal Storage 3000LE, the world's first 40GB external hard drive with high speed USB 2.0 interface. This value-priced solution quickly and easily expands computer storage without opening up the computer. Ideal for digital photos and video, MP3 songs, electronic games and other large files, the 3000LE with USB 2.0 also delivers up to 40 times faster performance than current generation USB 1.1 hard drives. The 3000LE's high speed USB 2.0 interface enables easy and instant connectivity with virtually all existing USB ports -- including backward compatibility with USB 1.1. "USB 2.0 makes data transfers easier when upgrading from older PCs, and also protects a consumer's investment when purchasing new computers with the new USB port," said Jason Ziller, Intel technology initiatives manager and USB Implementers Forum chairman. "From the user's perspective, USB 2.0 has the same benefits and ease of use as USB 1.1 but with considerably higher bandwidth which greatly benefits the performance of devices such as Maxtor's personal storage solution." Priced at $199.95 and currently shipping to retail stores and, the 3000LE provides users with a convenient and speedy alternative to the complexity of installing internal hard disk drives. Operating at 5400RPM and providing 40GB of capacity, the 3000LE meets the demanding needs of today's computer users.

Tuesday August 7, 2001 Top

Three Companies Readying New Pentium 4 Chipsets

The computer memory industry, notorious for roller-coaster swings between bust and boom cycles, has never been this low--and hopes for a quick rebound are fading. Prices have sunk to the point where memory manufacturers are selling their chips for well below cost and are unable to cut costs deeply enough to squeeze out a profit, despite repeated rounds of layoffs. Hopes for a quick end to the carnage have faded since memory makers have reported several weak quarters. That's good news for consumers, who can add memory for a fraction of last year's prices, but disastrous for manufacturers. To illustrate the extent of the plunge, take a look at pricing for 128-megabit synchronous dynamic random access memory (SDRAM) chips, the most common type of memory used in PCs. A year ago, SDRAM chips averaged $18.40 each. Now, the same chip sells for about $1.50 on the spot market. On average, prices on DRAM decline by about 32 percent per year, according to Dataquest.

"Relative to cost of production, it is at the lowest point it's ever been," said Andrew Norwood, an analyst with researcher Gartner/Dataquest. Still, memory makers and industry analysts hold fast to the idea that the notoriously cyclical memory market will come back around, as it always has. The only variable is when, they say. "Now, it's only a matter of time (and) of sitting tight and not blinking," said Norwood. "Maybe by this time next year, the market will recover." With memory manufacturers losing so much money, speculation has mounted that one or more manufacturers might close up shop or sell out to competitors. But analysts believe it's unlikely any of the larger players, including Samsung, Micron Technologies or Hynix Semiconductor (formerly Hyundai), will do so.

One way to turn things around is to manufacture more expensive memory forms. Technologies such as double data rate (DDR) memory, championed by Micron, and Rambus DRAM, sold by Samsung, command a higher price and offer fatter profits than standard SDRAM. Samsung officials say they believe that RDRAM and DDR will make up about 25 percent each of its memory mix, with SDRAM accounting for the remaining 50 percent, by the end of the year. Currently, the memory maker's mix is about 20 percent RDRAM, less than 10 percent DDR SDRAM and 70 percent SDRAM, company executives told recently. A resurgence of the PC market is likely to help popularize the new memory technologies, further boosting fortunes for those who last out the downturn. "If they grit it out now, they should rake it in in the future," Dataquest's Norwood said. "That's the allure of the DRAM industry. It's very hard to kick the habit."

Intel Announces Future Processors Upgrades

During a U.S. Bancorp Piper Jaffray conference for financial analysts, Anand Chandrasekher, vice president of Intel's Architecture Group, all but confirmed that the chipmaker would launch its 2GHz Pentium 4 later this month, cut prices and go for the jugular of rival Advanced Micro Devices. Repeating statements made by Executive Vice President Paul Otellini during the company's second-quarter earnings conference call, Chandrasekher said Intel will move aggressively to make Pentium 4 the standard chip for PCs. The main weapon will be price cuts, prompted by more efficient chipmaking methods and the introduction of Intel's 845 chipset, which will allow PC makers to pair the Pentium 4 with cheaper SDRAM memory. That means, Chandrasekher said, that Intel's 1.5GHz and 1.6GHz Pentium 4 processor will take the place of its 900MHz and 1GHz Pentium III chips that are currently used in PCs priced between $800 and about $1,200. All this shows "a pulling away from the competition at this point," Chandrasekher said. "By the end of this quarter, August, we'll be at a 500MHz" advantage over the fastest AMD chip, he said. "It's our intent to maintain that (lead) over time."

Although he did not mention the competition by name, Chandrasekher was referring directly to AMD's Athlon processor. Intel's fastest chip is a 1.8GHz Pentium 4 and AMD's is a 1.4GHz Athlon. The introduction of the 2GHz Pentium 4 will widen the gap to 500MHz once AMD introduces its 1.5GHz Athlon, expected later this quarter. Intel's chip will offer 500MHz more in clock speed, giving Intel an advantage when it comes to marketing the Pentium 4. But analysts say the new Athlon should be able to keep up by posting strong overall performance numbers rivaling the Pentium 4. Meanwhile, Intel will beef up its Celeron chip considerably. Now targeted at PCs priced at $800 and less, the Celeron will gain clock speed and be made under a new manufacturing process before the end of the year. Intel will push the chip to 1.2GHz by the end of the year, Chandrasekher said. It is likely that Intel will introduce its 1GHz Celeron relatively soon. A 1.1GHz chip is also expected. The company has said it will transition Celeron to the 0.13-micron manufacturing process later in the year, which should lead to a 1.2GHz chip.

PC's Likely to Ship With Windows XP in September

Microsoft has given PC makers the go-ahead to ship Windows XP as much as one full month before the operating system's official Oct. 25 launch date, sources close to four major PC makers told CNET Computer makers plan to debut PCs and notebooks with the new operating system in late September, a move that could help jump-start stagnant sales. How soon customers could receive the PCs from the manufacturers is not clear, however, because the testing process could be more complicated for this release of Windows than for its predecessors. For Microsoft, the early release of Windows XP has an additional benefit. The company is advancing its release schedule to ship Windows XP ahead of any possible injunction that would delay the new operating system's debut, analysts said. Microsoft could send PC makers the final--or gold--code for Windows XP as early as Aug. 15, or about two weeks ahead of schedule, the sources said. That would allow PC makers to sell systems with Windows XP installed in September. But the sources warned that Microsoft could change plans at any time, and that nothing is certain until the code actually ships. Consumers looking to upgrade existing PCs would have to wait until October for the retail version of Windows XP to ship. Businesses subscribing to one of Microsoft's licensing programs could begin upgrades by late September, sources said.

Along with Windows XP's shipment, Microsoft also is set to release Internet Explorer 6 sometime in the next week. The Web browser will be included with Windows XP and will be available for other Microsoft operating systems. Jim Cullinan, Windows XP lead product manager, declined to discuss the timing of Windows XP's release or Internet Explorer's ship date, other than to say, "we are on schedule to launch (Windows XP) on Oct. 25." Sources close to four PC makers said that they had been instructed by Microsoft not to promote the Windows XP systems before Oct. 12. Those computer manufacturers selling through dealers could ship PCs to stores starting Sept. 17. Neither move--early release of the gold code or availability on new systems--would be unprecedented. PC makers, for example, also started selling previous releases of Windows, including Windows Me and 2000, ahead of their launch dates. In the case of Office XP, Microsoft released gold code nearly two months ahead of the official May 31 launch, with some PC makers selling the productivity suite on new systems about 30 days earlier.

Apple Settles Lawsuit With "Worker Bee"

Apple Computer has quietly settled a lawsuit against a former worker who allegedly posted company secrets on the Internet under the pseudonym "worker bee." According to documents filed at California's Santa Clara County Superior Court, Apple reached a deal in April with Juan Gutierrez, a former temporary worker whom Apple alleged was responsible for the "worker bee" postings. As part of the settlement, Apple and Gutierrez jointly agreed that he would turn over any confidential information he still had in his possession and refrain from sharing any more information he may have learned during his time at the Mac maker. Gutierrez had originally signed a nondisclosure agreement with Apple in October 1999, according to court documents. Edward Davila, an attorney for Gutierrez, told CNET on Tuesday that his client is grateful that Apple decided to settle the case. He described Gutierrez as a smart, young Mac fan who got caught up in the excitement of knowing what Apple was developing.

"He exercised some non-maliced, bad judgment," Davila said of Gutierrez, who is in his 20s. "I think it was kind of youthful enthusiasm and exuberance." Davila said the stipulations that were part of the court record represent what Gutierrez agreed to as part of the settlement. "There were no side deals or anything like that," said Davila, adding that Gutierrez is still working in the technology industry. The low-profile settlement came in sharp contrast to the intense interest generated last August when Apple sued "worker bee" as an unnamed individual for allegedly misappropriating Apple's trade secrets. Apple then obtained a court order forcing Yahoo to turn over records in an effort to identify "worker bee." The postings of "worker bee" to various Mac sites and to a Yahoo GeoCities Web site started in February 2000. The postings offered details on several upcoming Apple products, including iBooks, the Power Mac G4 and the Pro Mouse.

Netscape Readies New Version for Release

AOL Time Warner is close to releasing the first final upgrade to its notoriously buggy Netscape 6 browser, promising a smoother and faster ride for Netscape loyalists. The upgrade comes nearly nine months after Netscape released Netscape 6, which itself was two-and-a-half years in the making. That browser, the first based on the open-source development effort, was roundly judged to be not ready for prime time. Now sources close to Netscape are calling Netscape 6.1--a beta of which appeared in June--a vast improvement over the buggy 6.0 release. Most of the last nine months' work has been fixing bugs and improving performance and stability, according to sources. Other changes include a new cache for storing frequently accessed files, an upgraded mail program, new search functionality, and--borrowing a page from competitor Microsoft's Internet Explorer browser--drop-down auto-complete for Web page forms. Whether Netscape 6.1 can rally the Netscape faithful remains to be seen. While Netscape 6 encountered first delays and then scathing reviews, Microsoft assembled an overwhelming lead in the browser market.

Wednesday August 8, 2001 Top

VIA Readying Pentium 4 Chipsets Despite Legal Issue

Taiwan's VIA Technologies is pressing ahead with the launch of a controversial chipset designed for use with Intel processors, despite legal tangles after unveiling a similar product last year. VIA is targeting an August or September launch for its P4x 266 chipset, which it claims is 25 percent cheaper than Intel's competing Brookdale product, said Ted Lee, the Taiwan firm's sales and marketing vice-president, on Wednesday. "If our chipset product is better, and scheduled ahead of Intel's, we can grab more market share," Lee said, adding that it may happen in the second half. There's just one problem: Intel has not said it would grant VIA a license to build the P4x 266, unlike rival chipset makers Silicon Integrated Systems and Acer Labs. Lee said VIA's chipset was not only cheaper than Intel's Brookdale 845 chipset unveiled in June, it also yielded better performance. The Brookdale is due to hit the market in the second half.

VIA Chief Executive Officer Chen Wen-chi has said his legal team advised him that launching the Pentium 4 chipset without an Intel license would not run into legal trouble, although he did not elaborate. In fact, Lee envisions VIA and Intel reconciling and working hand-in-hand to further the P4's cause. He said VIA's cheaper but comparable--performance-wise--chipset solution could actually make Intel's microprocessor more widely accepted. "We can become a major partner of Intel's. This is a business judgement," Lee said. "If Intel wants to generate more visibility and interest, then our chipset will be the best solution to enable Intel's P4 platform." For now, Via is confident that Intel's top echelons would see the logic of the situation. "If you talk to the (Intel) chipset guys, of course VIA is their major competitor. But if you talk to the corporate decision-makers, they have to justify which is better," Lee said.

AMD Plans to Try to Demphasize Clock Speed

Chipmaker Advanced Micro Devices will start prodding consumers to jump over the megahertz gap next month. AMD is preparing to launch its next desktop Athlon processor, a 1.5GHz chip, in late September, sources said. The new desktop processor will be AMD's fastest chip. But despite performance boosts, the 1.5GHz Athlon will still be a clock speed underdog compared with rival Intel's Pentium 4 processor line, set to hit 2GHz later this month. As a result, AMD faces a huge marketing challenge: shifting the terms of its ongoing speed battle with Intel from pure clock speed to pure performance. "I would expect to see (AMD) marketing shift to emphasize...the architectural value of a (processor) core and the fact that for the same amount of clocks, you're getting more performance," said Dean McCarron, principal analyst with Mercury Research in Scottsdale, Ariz. "That's a challenge. It's not easy to convey." The clock speed issue has dogged AMD before, but the chipmaker intends to address it head-on this time with a marketing campaign that will stress that numbers don't tell the whole story, according to sources familiar with the company's plans. It will be up to AMD to convince PC buyers otherwise. As a result, the chipmaker must wage a battle to change PC buyers' decision-making process away from clock rate to a wider view of total PC performance. AMD executives declined to comment on unannounced products.

The company could adopt a performance rating, similar to measurements used in the past by AMD, Cyrix and other Intel competitors to rate chips based on their equivalency to an Intel processor. But it's unlikely AMD will go down that path. Instead, it is likely to take a more direct approach with customers, likely using advertising to spell out its position. The issue is more pressing now because AMD will lag Intel by a full 500MHz in clock speed--the speed at which a processor executes instructions. The new Athlon will also be boosted by a pre-fetch Level 2 cache, which anticipates data needed by the processor core and stores it ahead of time in high-speed "cache" memory. The chip will also sport the SSE multimedia instruction set, aimed at enhancing multimedia performance. To date, AMD "hasn't done anything from a marketing point of view to help its case," Krewell said. He suggested that advertising would help AMD deliver its performance message and also build its brand name among less-sophisticated PC buyers as the back-to-school and holiday buying seasons approach. If AMD is unsuccessful in educating PC buyers, analysts say, the chipmaker will likely be forced to keep pace with Intel price cuts, selling its flagship 1.5GHz Athlon chip at lower prices than a chip of its performance could otherwise command. Such a situation could further drag down average selling prices for AMD chips, an important element in the company's goal to break even in its current third quarter.

Internet Explorer and Netscape Receive Updates

Netscape 6.1, the latest update to the Netscape browser suite, greatly enhances the performance and stability of Netscape 6 while improving functionality and adding a number of key features. Netscape 6.1 lets you accomplish more online with efficiency in completing tasks, power through more choice and safety with more control. Auto complete in the URL bar initiates a search with one click. A streamlined Navigator interface that has fewer main buttons and toolbars to reduce distractions and give you more space for your web page. New download interface lets you see where a file has been downloaded on your computer with one click. The Quick Launch feature in Netscape 6.1 helps get you going faster by dramatically reducing the startup time of the browser. When you run into a web page in a foreign language, use the AutoTranslate feature to automatically translate the text into your native language. New translation additions: French to German and back, French to Russian and back. New Mail interface includes a startup view that helps you get started in a particular email account more quickly by providing one click access to your inbox, account settings, email filters, and more. Netscape 6.1 includes Netscape Navigator, Netscape Mail, Netscape Instant Messenger, Netscape Composer, and Netscape Address Book. Netscape 6.1 also delivers cutting-edge add-on applications that help you get more from the Internet. Netscape 6.1 offers Java for running web applets, Nullsoft Winamp for audio playback, RealPlayer8 for streaming media, Macromedia Flash for high impact web content, Net2Phone for FREE PC-to-Phone calls anywhere within the US, and Print Plus from Hewlett Packard for easy access to printing supplies, services and features.

Microsoft is keeping mum amid leaked e-mails and builds suggesting that a final version of its Internet Explorer 6 browser is nearing completion. In an e-mail seen by CNET, the Internet Explorer team called a recent test, or "beta" version of IE 6 "what we expect to be the final build for the Internet Explorer 6 release." The e-mail, to beta testers, requested final comments and suggestions by Aug. 7. Microsoft declined to comment on the e-mail, which was first reported by Beta News. The company also declined to comment on purported leaks of the final IE 6 build, along with leaks of Microsoft's Windows Messenger and Windows Media Player, on the Maximum Reboot Web site. The company reiterated its previous announcements that IE 6 will be released before the launch of Windows XP, which is officially scheduled for Oct. 25, but declined to specify when. In the IE 6 e-mail, Microsoft touted the upcoming browser as a big improvement over its currently available IE 5 release, from stability to support for World Wide Web Consortium (W3C) standards. "Internet Explorer 6 sets a new level in terms of stability and robustness, providing a quantitative improvement from Internet Explorer 5.0," the e-mail reads. "Also, Internet Explorer 6 provides a high level of support for W3C recommendations, ranging from base technologies, such as CSS and DOM, to brand-new ones such as SMIL 2.0." The e-mail also outlines IE 6's implementation of the Platform for Privacy Preferences (P3P), a W3C working draft that helps people determine how much of their personal information is accessible to Web sites they visit. | Download Netscape

Nanotubes Move Step Closer To Viability

Scientists said Wednesday that they are closer to understanding how electron waves move along nanotubes, tiny cylindrical structures that may one day form the basis of smaller and faster computer chips. About 50,000 times thinner than the diameter of a human hair, nanotubes are being touted as the future of the Information Age, replacing wires and silicon appliances. Some companies are boasting they have already built the first array of transistors from the microscopic structures, but researchers say little is known about what goes on inside them. New light has been shed on the minuscule conductors by a team of scientists using a scanning tunneling microscope (STM) to map the undulations of electron waves.

"One problem has been that molecular-scale systems such as nanotubes are very difficult to look at even if you can make them," said Serge Lemay of the Delft University of Technology in the Netherlands and co-author of research in the journal Nature. "This kind of experiment gives greater detail on the electronic properties and how the electrons move around in the system," he told Reuters in an interview. The STM contains a fine metal tip that feels for "bumps" and "grooves" in the electronic structure at the atomic scale. The apparatus provides final confirmation of what theorists had predicted: that electrons in metallic nanotubes move along two different electron "bands" that can interfere with each other.

Lemay said his findings are only a small step toward understanding the properties of nanotubes and whether they can one day replace silicon in microelectronic devices. "This work itself is quite a few steps removed from industrial applications," he said. "Research in molecular electronics as a whole could open up the way for doing the chemistry in a beaker and building a circuit that way. "Before we can beat silicon electronics, we must find new ways of making molecular circuits. The new bag of tricks with molecular systems is quantum mechanics." He said the next stage of research with the STM is to look at circuits built from a number of nanotubes as opposed to single structures.

First Virus Found in PDF File

Adobe's popular PDF file format--known to anyone who's ever called up a tax form on the IRS Web site--has generally been considered immune to viruses. But a new virus carried by programs embedded in PDF files raises concerns that the format itself could become susceptible. On Tuesday morning, Network Associates' McAfee antivirus division became aware of the first virus--known as "Peachy"--that uses PDF to spread, said Vincent Gullotto, senior director of McAfee's Avert group. Fortunately, those who are simply viewing a PDF, or Portable Document Format, file aren't vulnerable. The virus spreads only by way of Adobe's Acrobat software--the program used to create PDF documents--not through Acrobat Reader, the free program that is used to view the files. "There is no way for this to affect Acrobat Reader," said Adobe's Sarah Rosenbaum, director of Acrobat product management.

"The code in Acrobat that recognizes attachments does not exist in Reader." Peachy exploits an Acrobat feature that allows people to embed other files within a PDF--attachments that can be opened only by people using Acrobat. "Right now it's considered to be a low risk because we haven't seen it reported to us from a customer," Network Associates' Gullotto said. But the Peachy virus raises the issue that PDF files--widely used to display documents within Web browsers and e-mail--could become a new channel for spreading viruses. "What I'm concerned about here is that this could be a new frontier," said Richard Smith, chief technology officer of the Privacy Foundation. "It's considered to be a safe file format." Smith posted news of the virus to the Bugtraq security mailing list Tuesday. It's clear that if Adobe modified future versions of Reader so that it could read attachments embedded in PDF files, the program could fall victim to Peachy's descendents.

Rosenbaum said that while it's possible Adobe might add attachment-handling capability in future editions of Acrobat Reader, the company has no immediate plans to do so. Acrobat lets people embed different file types within a PDF, including everything from the VBScript programs--used in the LoveLetter virus--to an actual executable program, Gullotto said. Peachy is named after a small game in a PDF file that involves finding peaches, Gullotto said. According to a person called Zulu, who said he wrote Peachy, showing the solution to the game runs a VBScript file. The virus then spreads to others using e-mail addresses collected from Microsoft Outlook, Gullotto said. Using PDF bypasses the filters in newer versions of Outlook that ordinarily screen out VBScript files.

Thursday August 9, 2001 Top

Microsoft Will Require IE 6 to use Passport

Microsoft will soon be offering better privacy and security for online consumers, but at a price: exclusive use--for now--of the company's forthcoming Internet Explorer 6.0 Web browser. Microsoft executives said on Wednesday that the company's Passport authentication service will soon support an emerging privacy standard called Platform for Privacy Preferences, or P3P. The standard is advocated by the World Wide Web Consortium, a Web standards body, and was adopted by Microsoft in June for use in its software. P3P allows Web users to define what types of information they are willing to give, as well as whether they mind sharing that information with outside parties. Internet surfers will receive a warning before visiting sites that go beyond the stated level. P3P is "a good thing, because it establishes a set of standards and guidelines vendors have to comply with" regarding privacy, said David Smith, an analyst with Gartner. "More privacy is always a good thing, and Microsoft is offering more privacy."

But the P3P features can work only if consumers have installed IE 6, said Brian Arbogast, a vice president of Microsoft's Personal Services Division. In negotiating contracts with new partners, Microsoft is requiring companies that plan to use the Passport service to support P3P, he added. Microsoft has built P3P into its own Web sites and will support it in IE 6, said Adam Sohn, product manager for Microsoft's .Net strategy. "The W3C is evangelizing this, and we're evangelizing it," he added. "It's good for consumers to manage their privacy." Passport is a key component of Microsoft's upcoming .Net and HailStorm Web services initiatives and is required for using some of Windows XP's newest features, such as Windows Messenger, a communications console featuring instant messaging, videoconferencing and application sharing. Because Passport authentication is done using a Web browser, people using competing products, such as AOL's Netscape 6.1 or Opera, would not be able to use the enhancements unless those browsers are also made P3P-compliant. The same restriction would apply to older versions of Internet Explorer.

More Details Released On Windows XP Desktop

PC makers that choose to ship Windows XP with icons on the desktop will have to include at least three Microsoft-mandated icons, the company said. News of the requirement that PC makers include an MSN Internet access icon on PC desktops emerged last week. On Wednesday, Microsoft spokesman Vivek Varma said Microsoft restrictions could also compel PC makers to place icons for Internet Explorer and Windows Media Player as well as the Recycle Bin on PC desktops. The placement of the Windows Media Player icon could create more controversy for Microsoft as it puts the finishing touches on Windows XP. PC makers on Wednesday reported that Microsoft told them the company would likely release final, or gold, code Aug. 22. New Windows XP PCs are expected to go on sale Sept. 24, about a month before the operating system's official late October launch. The Redmond, Wash.-based software giant had planned to ship Windows XP with a clean desktop. But last month the company gave PC makers the option to populate the desktop with icons and to change icons on the Windows XP Start menu. Microsoft has taken a similar approach to the desktop as it has to the enhanced and redesigned Start menu.

There are two options for those PC makers choosing not to ship a clean desktop. The first is placing icons for Internet Explorer 6, MSN Explorer, Windows Media Player and the Recycle Bin on the desktop. Windows XP copies sold at retail will come with a clean desktop and by default a feature that occasionally offers the user the opportunity to clean icons off the desktop. Although the desktop seems like the natural battleground for placing and competing for placement of icons, the real war may be waged over the Start menu. Windows XP comes with a redesigned Start menu with eight icons prominently placed and easily accessible in one mouse click. In testing versions of the operating system, some of those icons rotated out and were placed with others for frequently used programs. Varma noted that of the eight spaces available, five are reserved for computer manufacturers. Several PC makers said privately they had been approached by companies looking for either icon placement on the desktop or in the Start menu.

LCD Display Prices Could Rise Significantly in 2002

Taiwan's flat-panel makers, which account for around a quarter of world output, are hoping for a financial recovery next year after steep losses this year as falling prices offset a boom in output. Eric Lin, an ABN AMRO analyst, said he expects most Taiwanese makers of thin-film transistor liquid-crystal displays (TFT-LCDs) to report huge losses in 2001 due to tumbling prices. He also forecasts a sharp turnaround next year. TFT displays, also known as active-matrix displays, offer high resolution for notebooks and flat-panel displays for desktops. "Most panel makers should report sound profits in 2002 based on expectations that prices could bounce back 15 percent, component prices could fall 20 percent, and demand for panels remains strong," Lin said. Demand for flat screens has soared for use in notebook computers, flat-panel monitors, cell phones, personal digital assistants, televisions and automobile displays.

Taiwan is the world's third-largest producer of computers and related peripherals, most of which are made on a contract basis. These contract manufacturers supply products to nearly all of the top multinationals, such as IBM, Toshiba and Dell Computer. The island's TFT-LCD industry is expected to produce $4.9 billion worth of screens this year, up 70 percent from 2000, Taiwan's Ministry of Economic Affairs said in a recent report. For example, prices of the industry's benchmark 15-inch panels have fallen sharply this year amid the global electronics downturn at a time when output has soared. Prices have halved from around $410 in December for a typical 15-inch TFT-LCD to the current $205 and could fall another 10 percent in coming months, analysts said. "The sharp price falls in TFT-LCDs have triggered booming growth of LCD monitors, whose global sales are expected to surge 135 percent year on year in 2001 to 15.1 million units," said Sean Wu, electronics analyst of the quasi-governmental Institute for the Information Industry in Taiwan.

MPEG-4 Likely to Reach the Web Soon

While Microsoft and RealNetworks wage a noisy fight over their audio and video technologies, an underdog with a strong pedigree and whiz-bang features is quietly entering the fray. After lying low for a couple of years, MPEG-4--the successor to the technologies that spawned the MP3 audio explosion--is catching on with developers who are taking advantage of its ability to manipulate digital music and video files. MPEG-4 is a wide-ranging set of audio and video technologies designed in part to condense large digital packages into small files that can be easily transmitted online, much like today's most common media formats, such as MP3, RealVideo and Windows Media. But perhaps more important, proponents say, are the interactive features that MPEG-4 offers. For example, video functions almost like a Web page, allowing people to interact with the picture on the screen or to manipulate individual elements in real time. Like that dress that Julia Roberts is wearing? Simply click on her face to buy it. Want a closer look at what they're eating for dinner on "Survivor"? Zoom in for a close-up of the grub.

The ability to give video itself the kind of interactivity that only Web sites and video games now enjoy has ignited the imaginations of advertisers and some Hollywood studios. To be sure, there's a long way to go before average consumers are interacting with actresses on their TV screens, but analysts say the technology bears considerable promise. "It's nice in theory," said Aram Sinnreich, a media analyst with Jupiter Research. "I think there's no question that when the infrastructure is there, and the costs are lower, there will be consumer demand." Backers tout it as one potential "killer app" for the fast mobile phone networks that will be built over the next few years and will desperately need new applications that can generate revenue. "There are major technical challenges," said Forrester's Scheirer. For now, there is not good technology that can automatically encode video into these interactive "objects," he said. Nevertheless, MPEG-4 is being touted as an alternative to Microsoft's growing push into the media world. Even if it doesn't find its way onto many consumer Web sites, it is likely to be adopted by video and broadcast companies that have traditionally looked for standards-based technologies to use inside their own networks.

AOL Accused of Shutting out Smaller ISP's to it's Network

A Texas Internet provider on Thursday charged AOL Time Warner with locking out independent providers from its high-speed network, an act that could violate an agreement with the U.S. government. In a complaint filed with the Federal Communications Commission, Austin-based Internet service provider said AOL Time Warner had refused to negotiate terms of access to its high-speed cable-modem network, while at the same time forging agreements with large, national providers. In order to win approval for their merger, America Online and Time Warner agreed to allow rival Internet-service providers (ISPs) access to their high-speed cable lines. The FCC, in giving its merger approval in January, said AOL Time Warner "must engage with local and regional ISPs in a good faith, nondiscriminatory manner."

The merger combined AOL, the largest Internet access provider in the United States, with Time Warner's extensive network of cable modems, which enable users to access the Internet at speeds much higher than conventional dial-up modems. alleged in its complaint that the media and telecommunications giant has discriminated against small Internet providers, choosing instead to only allow large providers like EarthLink and Juno Online Services access to its wires. "We've attempted to open the negotiation processes for a year now and have continuously come back to the very point where we started. It is disturbing to see how AOL Time Warner has handled the communication line between us," President Jonah Yokubaitis said in a release. An AOL Time Warner spokeswoman said the company has been involved in negotiations with several smaller service providers, including, but could not possibly reach deals with all of them before it opens up its network in September.

Friday August 10, 2001 Top

Intel Shows Off Upgraded Xeon Processor Next Week

Intel will go Hollywood next week to demonstrate its fastest Xeon processor yet. The chipmaker will show off a 2GHz version of its high-end Xeon chip at the Siggraph computer graphics trade show starting Tuesday in Los Angeles, Intel executives confirmed. The 2GHz Xeon will star in demonstrations of single- and dual-processor workstations. Intel also will demonstrate Pentium 4 chips running applications such as Adobe Premier and a new concept technology called Lightning2, which connects 16 dual-processor Pentium III Xeon workstations to render video. The 2GHz Xeon is based on Intel's Netburst architecture--the same design behind the Pentium 4. The Xeon is available in speeds of 1.4GHz, 1.5GHz and 1.7GHz. Because it will go into more expensive workstation PCs, Intel charges a premium for the chip. The 1.7GHz, for example, is priced at $406, while a Pentium 4 at the same speed goes for $352. Later this year, Intel will transition Xeon to its 0.13-micron manufacturing process. A resulting new Xeon chip, code-named Prestonia, will debut at about 2.2GHz in early 2002, sources said. Though it announced its Xeon chip for workstations in May, Intel is not expected to unveil Xeon server chips until later in the year.

Intel Details Future Upgrades to the Itanium Processor

Although manufacturers are demanding server processors that produce less heat, Intel said Friday that a low-powered version of its 64-bit Itanium chip is still several years off. The server chip, launched earlier this year, is designed to tackle high-performance tasks such as processing vast databases. But server manufacturers are increasingly demanding low-power chips for the rack-mounted servers that fill data centers--and Itanium generates too much heat to fit inside these so-called high-density devices. Alan Priestley, strategic marketing manager for Intel's European enterprise marketing group, said Intel does not have plans to fit Itanium or other IA-64 chips into high-density servers for at least a year, if not more. "Future generations of Itanium will use high density, but not the current generation," Priestley said. "There is no way to get the current processor into a 1U form factor.

You couldn't do it because of the physical constraints of the processor." Some engineers and analysts have suggested that the performance of Itanium or its successors will have to be crippled to bring heat emissions to a manageable level, but Priestley dismissed the idea. "You have to do a lot more than step down performance to decrease watts," he said. "Everything we're doing now is to drive MIPS (millions of instructions per second) and keep watts down, and we don't want to drop that. Instead of performance cuts, Intel will look to new process technologies to bring power usage down. McKinley will shift the IA-64 line to a 0.13-micron process, and the process will later move to 0.1 microns. A version code-named Deerfield, set for late 2002 or early 2003, will probably be Intel's first attempt to optimize IA-64 for power consumption over performance.

Sun Working to Get Java to Work With Windows XP

Sun Microsystems has turned up the volume in its long-running battle with Microsoft over Java. In full-page ads in The New York Times, San Jose Mercury News and The Wall Street Journal on Thursday, Sun called on consumers "to demand that Microsoft include the Java platform in their XP operating system." Sun also said consumers should demand "PC vendors like Dell, Compaq, Gateway, IBM and HP include the Java platform in their applications." At the same time, Sun is quietly developing a new version of its software specifically for Windows XP that it hopes to place on new PCs and make available for download. Sun's ad attack underscores yet another battle over Windows XP: support for the company's Java programming language. While some critics are complaining about what Microsoft has put into XP--instant messaging and streaming media playback, among other features--Sun is upset about what is being left out: its Java Virtual Machine (JVM) software. Sun's actions stem from a decision by Microsoft in April to remove Java Virtual Machine from testing versions of Internet Explorer 6, which is integrated into Windows XP and will soon be downloadable for other operating systems.

While Microsoft will not ship a JVM with IE 6, one will be available for download the first time a person accesses a Web page requiring Java support. The file is about 5MB. But the spat over Java may have more to do with the Internet Explorer browser than with the new operating system. Internet Explorer and Windows support the JVM differently. Still, through Internet Explorer and Windows, Microsoft is in fact one of the biggest distributors of Java, so closing this channel even slightly is a blow to Sun, said Gartner analyst David Smith. Because Internet Explorer does not use a plug-in architecture like other browsers, such as AOL Time Warner's Netscape 6.1, it only supports Microsoft's JVM. That means Internet Explorer uses an older, outdated JVM instead of the newer, faster and more flexible JVM version 1.3.1. Java programs running anywhere else in Windows XP, or older versions of the operating system, can use version 1.3.1 if it is installed. But with most Java programs running in browsers, Microsoft's older version has in some ways created a roadblock for the programming language's advance, say analysts. Recognizing that opportunity, Sun plans to deliver a JVM fully usable by all programs in Windows XP, including Internet Explorer 6.

"What we are doing is developing a JVM that will reside inside the XP operating system that will be callable by any browser," Harrah said. "We expect to have the usual excellent Windows support when XP ships." Harrah said that the new JVM would be available for download from Sun and other Web sites and be included on some new Windows XP PCs. But he wouldn't discuss specific deals with PC makers. "But we have been very pleased by the reactions we have gotten from them," he emphasized. But some analysts are not convinced Microsoft will make it easy for Sun to introduce a JVM fully supported by Windows XP. "Sun will have to make it work with Internet Explorer, but Microsoft is not making it easy to do that," Smith said. "Java is a thorn in the side of Microsoft, and Microsoft continues to scratch at that thorn to dislodge it."

New Software Takes Screen Space From Windows

As Microsoft gets ready to launch its newest operating system, Windows XP, a battle is raging over how much leeway it will give computer makers to change the look of the main screen. Now xSides, a tiny Seattle company, is entering the fray with technology that literally pushes Windows aside and could provide such Microsoft rivals as Internet and media titan AOL Time Warner with valuable screen space completely free of the software giant's influence. Microsoft has heretofore exercised strict control over the initial start-up screens of new computers, barring PC makers from removing icons for its programs. For Windows XP, officially due out Oct. 25, the picture is muddier. Microsoft is encouraging PC makers to ship the product with no icons at all, saying it is a cleaner look. Icons are a key way for Microsoft and rivals to reach consumers as the companies start rolling out a new generation of subscription services built around such products as instant messaging, music and photography. These fingerprint-sized screen icons are a valuable channel for signing up customers, and with its lock on Windows, Microsoft has been the chief gatekeeper.

xSides Chief Executive Bob Steinberg, who as a lawyer successfully represented another company in a lawsuit against Microsoft in 1994, says xSides is set to change that. While most PC software runs on top of Windows, xSides bypasses Windows to talk directly with the hardware, Steinberg said in a recent interview. By intercepting the video signal, xSides is able to resize Windows--without Windows' knowledge--so that it takes up less screen space, Steinberg said. xSides could erase Windows entirely, but it doesn't go that far. It just creates a new strip under the "taskbar" or down the right side of the screen, where open programs are displayed. xSides can then add things to the new, non-Windows space: advertisements, icons, or applications like instant messaging and e-mail, Steinberg said. "It enables us to put anything we want underneath the taskbar. Windows has no idea it is where it is now because we take over the cursor, the keyboard, the so-called mouse events, and that allows us to be outside of the control of Windows,'' Steinberg said.

Browsers and other Windows-based programs can be launched from within the xSides space, completely out of Windows' control, Steinberg said. "xSides provides a thing now to sort of level the playing field," Steinberg said. A Microsoft representative said he was aware of the company but was not familiar with its products and therefore could not immediately comment. xSides could also partner with PC makers that, in a time of falling prices and profit margins, could shelve their fear of irritating Microsoft and install xSides and rent out the extra space to Microsoft rivals. "The PC manufacturers frankly are likely to be a little nervous about going this route. But all it will take is one, and the others will realize here's how to maximize your margin opportunity," said Chris Le Tocq, an analyst with Guernsey Research.

Microsoft Again Trys to Delay its Anti-Trust Case

The government on Friday criticized Microsoft's recent courtroom maneuvers, claiming that consumers could be harmed by further delays in the three-year-old-trial. On Tuesday, Microsoft asked the Supreme Court to consider an appeal in the case, arguing that a federal judge's comments to reporters before rendering his decision warrants throwing it out. The Redmond, Wash.-based company also asked the U.S. Court of Appeals for the District of Columbia Circuit to stay the mandate that would return the case to a lower court for further proceedings. But in a scathing 9-page legal brief filed Friday, the Justice Department and 18 states asked the appeals court to reject that request and allow proceedings to continue while the Supreme Court decides whether to hear Microsoft's appeal. In opposing the delay, government lawyers also emphasized the importance of the upcoming launch of Windows XP, making it clear the new operating system's competitive aspects would be explored when the case moves forward. "Microsoft has announced that it will soon introduce Windows XP, the next generation of its monopoly operating system," the brief states. "The sooner remedial proceedings begin, the sooner a resolution can be crafted to assure competitive conditions...Until that remedy is in place, each day of delay contributes additional injury to the public interest in competition." The government also suggested that Microsoft was trying to delay the case's return to the U.S. District Court for the District of Columbia, where a new judge will be chosen before new proceedings commence in the case.

Weekend August 11 & 12, 2001 Top

Recovery in the PC Market May Take Several Years

IDC has yet to release its final second-quarter figures for PC shipments, but the market researcher is already offering a more dire prediction for market growth. When IDC released its preliminary second-quarter numbers last month, it had forecast a slight increase in the fourth quarter of this year and a turnaround beginning in the first half of 2002. Now, the second-quarter data looks worse than previously expected. As a result, IDC will lower its PC market forecast and extend its expectations for a decline in the U.S. and European markets somewhat further into 2002. The company is now predicting that sizable recoveries of key markets, including the United States, will not occur until 2003, though a small amount of growth is still expected for 2002. Troubles in Japan may last longer. "We're lowering our forecast because the consumer market and the economies around the world are still weak," said Loren Loverde, director of IDC's Worldwide PC Tracker Service. Not all regions will recover at the same pace, he added. "It's different for different regions. For some, we're looking at a more substantial recovery in 2003," he said. At the moment, IDC is still finalizing the second-quarter figures and expects to release them by month's end.

But several areas are cause for concern. These include the worldwide consumer PC market and the Japanese PC market. Forecasts for the U.S. and European markets will also be slightly lower than the earlier forecasts. In a word, the U.S. market next year will likely be "slow," Loverde said. Of more major concern is Japan. The country's PC shipments fell off dramatically in the second quarter, causing IDC to lower expectations for Asia as a whole. "The (Japanese) market was much softer than we expected," Loverde said. Meanwhile, weaker-than-expected consumer PC shipments indicate that the rate at which people are buying their next computer is slowing, at least while economic uncertainty persists in many countries, Loverde said. Meanwhile, the release this fall of Microsoft's Windows XP operating system might not provide as much of a boost as some have been expecting. "We're uncertain that Windows XP will notably accelerate the market, based on the economy," he said. "We're skeptical that it will provide that much kick for the market."

Microsoft and Kodak Settle Problem Over Windows XP

Microsoft and Kodak have reached a settlement that could take some political pressure off of the software maker and its plans to launch the Windows XP operating system. Kodak had accused Microsoft of foul play in how Windows XP handles digital photos. The photo products maker said Windows XP limited consumer choice in the default application for manipulating photos and steered consumers to Microsoft's preferred online photo processors. The CEOs for the two companies--Steve Ballmer from Microsoft and Daniel Carp of Kodak--resolved many of their major differences last week, although some issues remain, sources close to the companies said. Beta testers of Windows XP, which is set for commercial launch this fall, dispute the legitimacy of Kodak's claims, however. Kodak's criticism appears to have been quelled by Microsoft changing one dialog box affecting how Windows XP handles imaging devices, such as digital cameras and scanners. Kodak agreed that its software would not automatically become the default for any digital camera attached to a PC--including competitors'--and to publicly support Windows XP. Kodak also plans to pull back some of the pressure it placed on Charles Schumer, a democratic senator from New York, to question whether Windows XP's photo features are anticompetitive. The companies are expected to announce the resolution of their differences Monday.

"We are pleased to have worked together with Kodak to resolve any perceived issues regarding how Kodak's cameras and software work with Windows XP," said Jim Cullinan, Windows XP lead product manager. "Kodak is an important partner for Microsoft, and we welcome feedback from Kodak on ways to improve the digital photo experience in Windows XP. "We think this is a positive move by Microsoft," Kodak spokesman Anthony Sanzio said Sunday morning. "We're happy that our EasyShare cameras will work well with Windows XP. We look forward to moving ahead with Microsoft to making further improvements with the digital photography experience." With the changes, rather than automatically bringing up Microsoft's wizard and pull-down menu of choices, connecting a camera will summon a single box of software choices capable of connecting to the camera. "The Scanner and Camera Wizard will be clearly labeled as a Microsoft function, not a generic function," Sanzio said. "Microsoft has agreed finally to sign third-party picture protocol drivers, so that if a camera manufacturer wants to use the standard Windows implementation they can, or they can use their own drivers for their own cameras."

Companies Stressing Stronger Security When Using Wi-Fi

Business travelers eager to plug their laptop computers into wireless Internet networks cropping up at hotels, airports and coffee shops need to be on guard: their e-mail and Web browsing can be easily intercepted, security experts warn. The problem, they say, is that these new networks, which charge an hourly fee for wireless access to the Internet, aren't protected by encryption and are vulnerable to hackers. "When you sit in an airport and use your laptop you might as well be broadcasting to anyone within listening distance," said Jason Sewell, a digital forensics specialist at security firm Predictive Systems. Wireless networks--known sometimes as Wi-Fi--are taking off. American Airlines offers them in all but two of its frequent-flier lounges at airports nationwide, and some entire airports are rigged for wireless connections. The networks are also popping up in hotels, and the Starbucks chain is introducing them at its coffee shops. Market-leader MobileStar, based in Richardson, Texas, provides about 650 wireless network areas for American Airlines, Starbucks and several hotel chains. Their networks have no encryption, so almost everything sent from a customer's laptop can be picked up by a nearby hacker.

Internet Security Systems co-founder Chris Klaus said it takes no special software to intercept data off a Wi-Fi network, and is easy to do. MobileStar's Web page touts its service as secure, but Tabassi acknowledged there is no notice in airport lounges or coffee shops informing consumers that their connections are not secure. He said the company's Web site tells people they should use a VPN, and that its phone representatives will give that advice when a customer calls. Tabassi said he was open to posting prominent notices wherever users access the network. MobileStar Chief Technology Officer Ali Tabassi said users should install personal firewall programs and use Virtual Private Networking software offered by employers. Richard Smith of the University of Denver's Privacy Foundation said that attitude was unfair. "I think the companies are being pretty irresponsible here," Smith said. "It's really their obligation to make this a secure and private system."

Linksys Takes Lead in Home Networking

Linksys is winning a David-and-Goliath battle against the likes of Intel and 3Com in the emerging market for technology that connects PCs within a home. For years, Intel, 3Com, Nortel Networks spinoff Netgear and other network hardware makers have championed the virtues of home networking, technology that allows consumers to connect their PCs and other peripherals in the home so they can share printers, files and a single Internet connection. But little-known network equipment maker Linksys has catapulted its way to become the early leader in a market that most analysts believed would be dominated by Intel and 3Com, two well-known brand names that spent heavily on advertising to tout their initial products in consumer magazines. In just five months in the market, analysts say Linksys has surpassed Intel, Lucent Technologies spinoff Agere Systems and others to become the leader in wireless networking kits, technology that allows people with laptops to roam around the house and still surf the Web. The 13-year-old, Irvine, Calif.-based company has captured more than 50 percent of the market for simple "routers," devices that connect multiple PCs in the home to a cable or DSL (digital subscriber line) modem.

Last year, Linksys was the first to come out with a low-priced router that connected multiple PCs to the Internet, Wolf said. "That hit a chord with consumers. It was a product that did what people wanted it to do, it was simple to use, and it was cheap. They hit a sweet spot in that market and the timing couldn't have been better." Linksys' low-end routers sell for between $99 and $129, while its wireless networking hardware is priced between $200 and $250. Linksys captured 57 percent of all sales of low-end routers this year through May 2001, followed by Netgear with 15.6 percent, Cisco Systems with 12 percent, SMC with 2.5 percent and D-Link with 2.4 percent, according to NPD Intelect. Cisco, which has postponed plans for high-end home networking equipment until the market takes off, has primarily sold its low-end routers to small businesses, analysts say.

Of the estimated $65 million spent in wireless networking products in the first five months of this year, Linksys took the top spot with 28.3 percent of the market, followed by Lucent's Agere with 19.3 percent, U.S. Robotics with 9.3 percent, and SMC and D-Link with about 8 percent each, according to NPD Intelect. Intel and Proxim ranked fifth and sixth in the market, with 5 percent and 3.1 percent, respectively. Linksys, which also sells to the small and midsized business markets, doesn't lead every home networking category, however. Intel dominates the market for phone-line networking kits, technology that allows people to link their PCs by plugging them into regular phone jacks. According to Cahners, Intel grabbed 53 percent of the market in 2000, followed by Linksys, 3Com and others. Besides having low prices, Linksys has flourished in the home networking market, analysts say, because it has managed to get its products in every major retail store, such as Best Buy, Wal-Mart, Circuit City and RadioShack, as well as on high-traffic e-commerce Web sites, such as and

CD Copy Protection Likely to be Cracked Soon

The growing buzz over copy-protected CDs may be causing some consumers to hear double. For several weeks, news that record companies have quietly been selling copy-protected compact discs in stores has been filtering around the Net. Although nobody has yet produced a verified copy of a CD loaded with this technology, developed by copy-protection giant Macrovision, it has produced a wave of "sightings" that have swept even to places as prominent as's consumer reviews. Accusations have been flying in e-mail, mailing lists and Web sites from people who claimed to find tainted CDs, ranging from 'N Sync singles to the latest works by the Dave Matthews Band. For the last several days, Amazon's lead consumer review on the page advertising the soundtrack to the movie "O Brother Where Art Thou" has been headlined "Warning, Warning, Warning." Even as Macrovision claims success in its efforts to slip copy-protected CDs past unsuspecting music buyers, the effort is raising new doubts about the viability of products that take away consumers' ability to copy songs. Beyond ratcheting up consumer fears of purchasing distorted CDs, hackers have targeted the effort as a test of their prowess, with some already claiming success even before they've had the opportunity to test out their techniques on an actual copy-protected CD.

The real buzz didn't start until Macrovision, a company best known for anti-piracy technology in videotapes and DVDs, said that its so-called SafeAudio technology had been selling as a test in CDs on the market for four to six months. At least one title had sold more than 100,000 copies, and close to 200,000 individual CDs had been distributed, the company said, adding that the return rate on these CDs has been no higher than usual. Macrovision's claims of success have not placated some consumers, for whom the threat of a distorted CD is as good as subjective reality. Meanwhile, the company's plans have drawn a line in the sand for hackers, who are already racing to see who can crack its safeguards first. The latest twist comes as hackers claim to find ways around the Macrovision technology, declaring the labels' efforts to block copying dead on arrival. In an article published on Dutch Web site, an analysis of the SafeAudio techniques claim that the copy protection can be evaded by using one of several CD copying techniques that have been floating around the Net for years, long before the current debate erupted. Because no copies of the protected CDs could be obtained--and not even CDFreaks claimed to have one--this technique could not be verified. Nevertheless, the technique has now been a source of considerable debate on technical communities around the Web for days.

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