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Week of September 16, 2001 News Archive

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Monday September 17, 2001 Top

Maxtor Releases First Ultra ATA/133 Hard Drive

Maxtor Corporation today announced volume shipments of the 40 GB per platter DiamondMax Plus D740X, the first 7200-RPM desktop hard drive with the new Fast Drive Ultra ATA/133 technology. Also announced today is the world's highest capacity ATA hard drive, the new DiamondMax D540X, a 5400-RPM hard drive that breaks both the Big Drive and Fast Drive barriers by offering a whopping 160 GB capacity and the latest Ultra ATA/133 interface technology. "The improved capacity and performance of these two drives is a direct result of the recent Maxtor-led industry initiatives that advance state-of- the-art hard disk drive technologies," said Mike Cordano, executive vice president of worldwide marketing and sales at Maxtor. "We have surpassed the 137GB capacity barrier and have increased data transfer speeds with Ultra ATA/133 technology as promised. As storage needs continue to expand, Maxtor remains committed to leading advances in technology and to introducing first-to-market products that offer OEMs and consumers the highest capacity, the fastest interface technology, and the most reliable solutions in the desktop disk drive market today."

Offered in capacities up to 80 GB, the DiamondMax Plus D740X is a 7200-RPM hard drive targeting commercial business users and consumer enthusiasts. The D740X is the latest in Maxtor's award-winning DiamondMax Plus line of drives and achieves greater than 10 percent improvement in performance than previous models. The 40 GB per platter D740X design provides the ultimate design flexibility and world-class acoustics with the option of either a traditional ball bearing motor or the quiet fluid dynamic bearing (FDB) motor of Maxtor's Quiet Drive Technology (QDT) Plus. The DiamondMax Plus D740X is the third generation of FDB motors from Maxtor to bring best-in-class performance and world class acoustics to demanding applications such as desktop video editing, games, and other multimedia applications. At 160 GB, the DiamondMax D540X strengthens Maxtor's reputation in the storage industry as the world leader in capacity within the 1" form factor, and breaks both the Big Drive and Fast Drive technology barriers. It is the latest offering in Maxtor's DiamondMax D540X line of 5400 RPM, 40 GB per platter hard drives now available in one to four platter designs.

"Maxtor is providing the desktop HDD industry's highest capacity drive, a great benefit for high-end storage consumers," said Mark Geenen, president of TrendFOCUS, a leading market research firm. "Maxtor continues to set the pace in introducing and delivering innovative products to market." The Maxtor DiamondMax Plus D740X is immediately available through major distribution and retail channels. Estimated manufacturer's suggested retail price for the Maxtor DiamondMax Plus D740X is $249.95. The DiamondMax D540X will be available through the same channels in early October with an MSRP of $399.95. Qualifications of both drives by major PC manufacturers are nearly complete. Each drive purchased will be bundled with a Promise Technology ATA controller card to allow full Ultra ATA/133 interface speed, a 33 percent increase in performance from the previous ATA/100 models. The new hard drives and controller cards are also fully backward compatible with earlier ATA technologies. These bundles are available to select geographic locations through October 2001. Starting in November, Maxtor will offer the Ultra ATA/133 card as a standalone product.

Via Releases 866MHz C3 Processor

VIA Technologies, Inc today announced the introduction of the new VIA C3 866MHz processor at the VIA Technology Forum in Beijing. This is the latest version of the VIA C3 processor based on the core formerly known as Ezra, which debuted at 800MHz and was the world's first processor built on the advanced 0.13-micron core. With its highly efficient design and ultra low power consumption, the VIA C3 processor is the coolest running x86 processor on the market. This, combined with robust application performance, full Socket 370 compatibility, and rock solid reliability, has seen the VIA C3 processor gaining increasing market acceptance as the ideal solution for a growing range of desktop Value PCs, notebooks, high-density servers, and the emerging new generation of Digital PC Appliances. "The VIA C3 processor has steadily built up a reputation for unbeatable reliability and long-term value," commented Richard Brown, Director of Marketing, VIA Technologies, Inc. "With the introduction of the new 866MHz version, this trend is sure to continue." The VIA C3 is the first processor in the world to be manufactured using leading edge 0.13 and 0.15 micron manufacturing processes, and boasts the world's smallest x86 processor die size. As the coolest running processor on the market today, the VIA C3 delivers ultra low power consumption and world-class levels of stability. It is fully Socket 370 compatible and is available at speeds of up to 866MHz. The processor also comes with 128KB Level 1 and 64KB Level 2 full speed cache, as well as support for a 100/133MHz Front Side Bus and MMX and 3DNow! multimedia instructions, to ensure robust levels of performance for all the most popular mainstream software and Internet applications.

Intel Begins to Unload Pentium III's

With Intel beginning to phase out the Pentium III, good deals on desktops with the chip are cropping up. To help proliferate the Pentium 4, Intel is effectively eliminating the Pentium III from the desktop market. As a result, computer manufacturers have begun to reduce already-discounted prices on their existing inventories of these computers. By the end of the first quarter next year, Pentium III computers will likely be gone from store shelves. Corporations, which have bought Pentium III PCs in fairly good numbers, will still be able to obtain them for a while. Until recently, 1GHz Pentium III systems ranged from $850 to $1150, according to analyst firm ARS. For example, a 1GHz Pentium III desktop with a monitor and printer could be found for about $949 after rebates in late August. Now, 1GHz Pentium III PCs can be found for $650 to $850 without accessories such as monitors. Retailer, for example, is offering a 1GHz Pentium III Emachines desktop for $619, including a rebate, as part of its deals this week.

The Pentium III, in some ways, is sandwiched between the more expensive Pentium 4 and the lower-priced Celeron. Pentium III's speeds generally range from 866MHz to 1.2GHz, while the Pentium 4 runs from 1.3GHz to 2 GHz and the Celeron ranges from 800MHz to 1.1GHz. Although Intel first outlined its phasing out of the Pentium III in March, the company began the extinction process in earnest in August with steep price cuts on the Pentium 4. The company then kicked up the process a notch with the release of the 845 chipset earlier this month, which allows PC makers to combine the Pentium 4 with cheaper, standard memory for the first time--instead of Rambus. Topping it all off, Intel has also announced schedules by which it will discontinue 866MHz to 1.1GHz Pentium IIIs with a 100MHz front-side bus, the data pipeline between the processor and system memory. The last orders for these chips are due in by early December, according to Intel's Product Change Notification service. However, a company spokesman said that Intel has not yet announced any plans to discontinue Pentium III chips at 1GHz or faster with a 133MHz front-side bus.

Microsoft Attacks DOJ Request for Denial of Appeal

Microsoft on Wednesday slammed the government's argument that the Supreme Court should reject the company's request for appeal. In its legal brief, Microsoft countered eight points made by government lawyers in a 26-page document filed almost two weeks ago. But Bob Lande, an antitrust professor with University of Baltimore School of Law, said he would be shocked if the Supreme Court accepted Microsoft's request for appeal. "The chances are astronomical," he said. Because of a court-mandated schedule, Microsoft spokesman Jim Desler said, Microsoft had to make the filing Wednesday instead of waiting out of respect for the victims of Tuesday's terrorist attacks here and in New York. "My understanding is that we needed to submit it to ensure that it was part of the record," he said. Microsoft and the government also are scheduled to file a joint status report with U.S. District Judge Colleen Kollar-Kotelly on Friday. It is unclear whether that filing might be delayed because of the national tragedy. In its Aug. 31 brief, the Justice Department and 18 states had asked the nation's highest court to reject Microsoft's request for appeal. Rather than appealing on the merits of the case, Microsoft in its request had once again attacked U.S. District Judge Thomas Penfield Jackson.

HP Stops Counterfeit Inkjet and Toner Cartridge Producers

In the last nine months, HP has helped authorities clamp down on alleged counterfeiters of its LaserJet and inkjet products in Asia Pacific, an effort that has led to more than 30 police raids. Among the equipment seized were counterfeit HP inkjet and toner cartridges, counterfeit packaging and some machines used in the manufacture of these products, said an HP spokesperson. He could not provide the street value of the seized goods by press time, but noted that almost all the cases have resulted in prosecution. He declined to elaborate, as some cases were pending further investigation. Some common legal penalties for counterfeit offenses include imprisonment, fines and a revocation of trading or business license, depending on the country and the circumstances surrounding the case. Most prosecution cases against counterfeiters originate from a simple telephone call to HP's customer support centers. "We receive between 100 and 300 anticounterfeit-related calls to our worldwide hotlines and service centers every month...and of this, Asia Pacific sees about a dozen complaints," the spokesperson said.

Each report is investigated and the appropriate legal action taken, he said. In May, HP introduced improved tamper-proof inkjet cartridge packaging that incorporates a security label with a color-shifting ink feature. When viewed face-on, the HP "invent" logo on the security label appears in color; viewed at any other angle, however, the logo appears in black. HP has been replacing its older cartridge packages in line with stock turnover on a market-by-market basis, he said. It is still too early to tell whether the number of complaints has fallen since the new packaging was introduced, he said, but "we are confident that the anticounterfeit features on our new product packaging will go a long way to deterring potential counterfeiters." Similar security labels are expected to be available for HP's LaserJet toner cartridges in coming months.

Tuesday September 18, 2001 Top

Nimda Worm Attacks PCs and Servers

A computer worm that spreads to both servers and PCs running Microsoft software flooded the Internet with data Tuesday, prompting the FBI to create a task force to investigate the attack, sources said. Known as "Nimda" or "readme.exe," the worm spreads by sending infected e-mail messages, copying itself to computers on the same network, and compromising Web servers using Microsoft's Internet Information Server (IIS) software. "It is extraordinary how much traffic this thing has created in a couple of hours," said Graham Cluley, senior security consultant for antivirus company Sophos. "As far as we can see, it doesn't seem to be using any psychological tricks because it's all automated." Mailing lists for the security community quickly generated news of the worm, as infected servers scanned the Internet for vulnerable servers. Sources in the antivirus community told CNET that the FBI has set up a "task force" to study the virus. The FBI held conference calls three times Tuesday night with antivirus experts to discuss the investigation, sources said."There was a task force set up today, and there were a lot of things discussed," said Vincent Gullotto, director of antivirus research at security software firm Network Associates.

The server component of the virus exploits an old and previously patched flaw in IIS called the Unicode Directory Traversal vulnerability. Once a server is infected, the worm continues to scan for other vulnerable computers. In addition, the program takes control of the part of Microsoft's IIS software that delivers Web pages, allowing the virus to trump a request for any page--even invalid requests--and instead return a page infected with the virus. In addition to its ability to cross between servers and PCs, the Nimda worm seems to be more virulent because it automatically executes in Microsoft's Outlook e-mail software under the program's "medium" security setting. "There appears to be a MIME exploit," said Eric Chien, chief researcher for antivirus software maker Symantec's European operations. "It appears that it is doing some kind of exploitation in e-mail." Nimda also appears to be capable of spreading by other means, including Internet relay chat (IRC), an online chat format, and by FTP for remotely exchanging files."My guess is we may also see it spread through Internet relay chat," said Alex Shipp, senior antivirus technologist at e-mail screening firm MessageLabs.

And that may not be the end of it. "We have also found an FTP component in there," Shipp said. "It may be trying to download nasty stuff from some Web site somewhere--we're still not sure. We know it is using FTP, but we don't know how yet." When Nimda arrives in an e-mail, it appears as an attachment named readme.exe. This is the same name used by another current virus called W32/Apost-A, so antivirus companies say many people should already be wary of attachments bearing that name. However, analysis of the worm is ongoing, experts said. "First of all, we are talking guesses at this time," said Fred Cohen from the University of New Haven in Connecticut. "Clearly, (it) just showed up this morning." For some time Tuesday morning, the worm's double whammy had experts believing that two pieces of code were spreading at the same time. The Computer Emergency Response Team (CERT) Coordination Center at Carnegie Mellon University issued a warning Tuesday morning about malicious code scanning for vulnerable Web servers and an e-mail worm called Readme.exe. "We are recommending to sites that they verify the state of security patches on all IIS servers and e-mail client software," the warning said.

New AMD Processors To Receive Athlon XP Designation

Chipmaker Advanced Micro Devices will call its upcoming desktop processor the Athlon XP in what seems to be an odd marketing coincidence. Sunnyvale, Calif.-based AMD next month will release a 1.5GHz Athlon desktop processor. But unlike current chips that merely go by the name "Athlon," the new chip and its successors will carry the XP suffix, similar to Windows XP, the name of Microsoft's next operating system. Although the XP designation appears to have been inspired by Microsoft, that's not the case, sources say. Instead, AMD will adopt the new brand as part of a campaign to differentiate its chips from competing products from Intel. The XP designation, sources say, is an unfortunate coincidence. In AMD's case, the letters XP stand for extra performance. In Windows XP, the XP stands for experience. AMD apparently had been contemplating the branding scheme at the time Microsoft made its announcement. The chip, which was originally due to hit desktops in the first half of 2001 at 1.2GHz, will contain features not found on current Athlons. For one, it is expected to consume less energy, which will allow PC makers to slip it into smaller PCs.

Mac OS X 10.1 Nears Completion

Apple Computer is putting the finishing touches on what could be the most important upgrade this year to its new operating system. But when the Cupertino, Calif.-based company will deliver Mac OS X version 10.1 is unclear. On Monday, the company canceled its Apple Expo in Paris, in light of last week's devastating terrorist attacks in New York and Washington, D.C. Apple CEO Steve Jobs was expected to focus on the OS upgrade during the trade show, with many analysts and Mac OS X 10.1 testers predicting its release at the event or in the days before it. Despite the national tragedy, the company did churn out at least one new beta, or test version, of the upgrade last week. And testers privately indicate that this recent test version is solid. "They could still make this month," said one person working with the beta who asked not to be identified. Although the market buzz may be about Windows XP, Microsoft's much-anticipated operating system release slated for next month, Mac OS X 10.1 is an important operating system release for Apple--one that could open the floodgates of new software applications and of more Mac OS users choosing to upgrade. In late March, Apple delivered Mac OS X 10.0, the most significant overhaul of the operating system since 1984. But some features were missing such as DVD playback.

Early adopters also complained of slow performance and the lack of native OS X applications, which may have slowed upgrades to the new operating system so far. And developers slammed Apple for stability problems that hampered their ability to move applications to the operating system. But with Mac OS X 10.1, Apple appears to have licked most of these early problems, testers said, making way for an autumn ripe with new applications and Mac user upgrades. "OS X 10.1 is a major upgrade and, as such, will correct most of the problems users have reported: overall speed, window redrawing speed, and DVD authoring, et cetera," said Doug Stanfield, a Mac user and technology coordinator from Bellefonte, Pa. "For many Mac users who are using OSX--myself included, and those in my office--it will be the dividing line between using it some of the time and using it all of the time." Signs that Mac OS X 10.1 is coming soon are everywhere. Dealers have started listing the new operating system in their catalogs, and testers report the recent beta is close to becoming final code. Apple had planned to brief industry analysts on the new OS last week but canceled the meetings after the terrorist attacks.

In another sign that release will be soon, dealers such as MacConnection have added OS X 10.1 to their catalogs, although they don't yet list availability dates. Apple isn't saying much. "We announced it would be available in September," Apple spokeswoman Natalie Sequeria said last week. She declined to give a specific delivery date. When the upgrade becomes available, owners of older Mac OS 8 and 9 versions can upgrade for $129. Apple is offering the 10.1 upgrade to OS X owners for free, but the company will charge about $20 for shipping and handling. CNET observed a recent test version, build 5G48, which shows improvements over an early August beta, build 5F24. The build includes DVD playback, which was missing from OS X but available for older versions of the Mac operating system as well as Windows. Other niceties: improved administration of AirPort wireless networking, DVD authoring, better Java support, easier Windows NT and 2000 networking, and faster searches. The 5G48 build also includes the final version of Internet Explorer 5.1 and newer versions of iTunes digital music software and the iMovie video-editing program.

Intel and Rambus Renew Licensing Agreement

Intel and memory chip designer Rambus renewed their licensing pact Monday, a move that will likely give the memory company a much needed shot in the arm. The new agreement, which supercedes the 1996 Intel-Rambus licensing agreement, grants Intel access to Rambus' entire patent portfolio for five years. In turn, Intel has agreed to grant licenses for patents Rambus needs to build memory interface technology. Intel will pay Rambus royalties of $10 million per quarter, Rambus CFO Bob Eulau said in a conference call with reporters and analysts. That's good news for Rambus, which has seen turbulent financial times this year. The company has spent millions pursuing patent infringement suits against three memory makers. Meanwhile, many PC makers have indicated they will veer away from incorporating memory based on Rambus designs in favor of standard memory to cut costs. Rambus is best known for RDRAM, its spin on memory technology for PCs.When it comes to RDRAM memory, it's business as usual for Intel.

Intel recently added support for standard SDRAM for its Pentium 4 processor. Until then, the company had paired the Pentium 4 with RDRAM exclusively. The new SDRAM-compatible 845 chipset, which connects the processor to other PC components, was designed to help lower the cost of Pentium 4 desktops. Intel maintains it will continue to support RDRAM on the high end of its Pentium 4 processor line, such as its newest 2GHz Pentium 4 chip. Intel has also said it will add support for a speedier RDRAM alternative, Double Data Rate SDRAM, early next year. The new agreement "doesn't change our current product road maps," said Intel spokesman Chuck Mulloy. RDRAM "is still the preferred memory technology for high-performance" PCs, he said.

Apple Cancel Paris Expo Planned for Later This Month

Apple Computer said Monday that it is canceling this year's Expo in France, after last week's devastating attacks on New York's World Trade Center and the Pentagon in Washington, D.C. Apple's Expo 2001 was scheduled to take place at the Paris Expo in Porte de Versailles from Sept. 26 to Sept. 30. "We're canceling Apple Expo in the wake of last week's devastating and tragic events," Apple CEO Steve Jobs said in a statement. "We're sorry to disappoint our users and developers, but their safety is our primary concern." In August, Jobs said the computer maker would not launch any new hardware at the Apple Expo in France. Instead, Jobs said his keynote presentation would focus on Mac OS X 10.1, the newest version of the Mac operating system. A company representative said that Apple Vice President Phil Schiller is still slated to give Apple's keynote address on Sept. 25 at the Seybold Seminars conference in San Francisco. There is no word from Apple yet as to whether Jobs, who had been scheduled to address the Seybold crowd via satellite, will now appear in person.

Wednesday September 19, 2001 Top

Microsoft Prepares for Windows XP Launch

Microsoft is ready to go ahead with the full-scale launch of its new Windows XP operating system next month, with a major event in New York City as the city recovers from last week's attack on the World Trade Center, Chief Executive Steve Ballmer said Wednesday. "If New York wants us, I'm sure we'll want to be there," said Ballmer, fielding questions from several hundred software executives at a Chicago Software Association luncheon. "We had been planning on a big launch for Windows XP in New York City, and I know we'll have discussions with the mayor and his staff before we proceed," Ballmer said. The Oct. 25 launch of Windows XP, Microsoft's first major overhaul of its consumer operating system in six years, had been expected to boost the struggling technology sector. Experts say an estimated 70 percent of computer users will need to upgrade their PCs to meet XP's memory and processing power requirements. But some analysts have questioned whether the Sept. 11 attack on New York and Pentagon, and the resulting dip in consumer confidence, could force Microsoft to tone down its marketing efforts. "The timing couldn't come at a worse point as far as a release cycle," Credit Suisse First Boston analyst Wendell Laidley said in a conference call with investors. "For us, one of the biggest issues is the change in consumer confidence as a result of these events, and one of the more material impacts will be on XP." Ballmer said the launch of XP, as well as the Nov. 8 launch of the company's Xbox video game console, would proceed as planned. "There is no reason why those products can't ship on their existing schedules, and I don't anticipate any change to the schedules," he said. "The products themselves will be available. We're not going to hold them back from the marketplace."

Intel Changes Xeon Processor Road Map

Intel has scrapped plans for a 2GHz Xeon processor for servers but has accelerated release of a 2.2GHz Xeon with enhanced performance features to fill the gap. The Santa Clara, Calif.-based chipmaker had planned to release a 2GHz version of Xeon for two-processor servers in the fourth quarter of this year, according to an Intel representative. That project has now been snuffed. However, the company will now release "Prestonia," the code name for a 2.2GHz Xeon for dual-processor servers, at the beginning of the first quarter of 2002 rather than toward the end of the quarter. A 2GHz Xeon for two-processor workstations will come out in September. The slightly accelerated release of Prestonia--and its accompanying Plumas chipset--also indicates that Intel appears to be succeeding in its conversion to the 130-nanometer (0.13-micron) manufacturing process. Prestonia will be made on the 130-nanometer process, which means the chip's basic features measure 130 nanometers. Foster, part of the Xeon generation of chips, is based on the 180-nanometer process. Smaller features mean more circuits can be squeezed on a chip, cutting down manufacturing costs while increasing performance and reducing power consumption. Prestonia chips will also be made with copper rather than aluminum wires.

In late 1999, Intel found itself facing a chip shortage partly caused by difficulties in converting from the 250-nanometer process to the 180-nanometer process at a time of high demand. Last month, company executives and analysts said the 130-nanometer conversion was on track. "The (130-nanometer) process is ramping like a hose," said Frank Spindler, vice president of Intel's mobile products group. The company, in fact, released notebook chips on the 130-nanometer process this past summer and will come out with desktop Pentium 4's, code-named Northwood, running at 2GHz or higher in the fourth quarter. The switch in manufacturing allows Intel to improve other architectural features of Prestonia as well. The chip will come with 512KB of integrated secondary cache, a reservoir of memory that stores data for quick access. The canceled chip, part of the Foster generation, would have had 256KB of secondary cache. Increasing the size of the cache typically improves performance. Both Foster and Prestonia are based on the Pentium 4 core. Northwood will also contain 512KB of cache, sources have said.

Microsoft Releases Details on Next Office for the Mac

Microsoft's Macintosh Business Unit (MacBU) announced today the official name for their Office suite of applications coming to Mac OS X, as well as availability and pricing. The suite, dubbed Office v. X will be available in November for U.S. customers and will ship internationally shortly after. The Office v. X suite includes Word, Excel, PowerPoint and Entourage, the email and personal information manager first introduced with Office 2001. Until now details of Entourage have been kept under wraps by Microsoft -- they didn't even show the application during the keynote address at Macworld New York this past summer. The functionality of Entourage will be familiar to users, but the interface has gone through a major facelift. Instead of having Tasks, Notes, Mail, Calendar, Address Book and Custom Views in the folder pane of the program, Entourage X has them conveniently located on the top left hand side of the application. Office v. X will also include MSN Messenger 2.1 for Mac, the company's instant-messaging application -- it is integrated with Office v. X through Office Notifications. Messenger will be fully localized into the international language versions of Office v. X, and it will support the double-byte character system in Japanese.

Office X runs natively on OS X -- it will not run under OS 9. All of the applications in the Office suite have undergone changes in their appearance adding Aqua buttons and dialog boxes. When making the Aqua interface the MacBU redesigned many of the buttons and took advantage of many features in the operating system. "We wanted to make our apps a great expression of OS X and not just Carbon," Browne told MacCentral. "This release of Office X is about showing our customers we are committed to them." When building Office v. X Kevin Browne said he wanted to take advantage of everything OS X had to offer. "I told my team to figure out what it is about the operating system that is special and take advantage of that," Browne said. "When someone asks what is about OS X that is interesting, my direction to them is to make Office something you can use to demonstrate that." Office v. X marks the beginning of Microsoft's move to OS X and away from Classic applications. "Office 2001 is definitely the last OS 9 version of Office -- everything we do from now on will be for OS X, Browne said." Office v. X will be available as an upgrade version for US$299 and as a standard version for $499. Customers that are licensed users of any Office 2001 for Mac application or Word + Entourage 2001 Special Edition can take advantage of a special limited time upgrade price of $149 fulfilled directly through Microsoft.

Nimda Worm Likely to Hit Home Users Hard

As antivirus experts complete a more detailed analysis of the Nimda worm and companies clean up their networks on Wednesday, several security groups are worried that home computer users will not secure their PCs. A coalition of government security officials and antivirus software industry experts released a warning to home computer users on Wednesday morning to take Nimda--and the security of their computer systems--seriously. "It is still out there, and home users are going to be the primary mechanism for the e-mail spread of this virus," said Vincent Weafer, a senior director of Symantec's security response center, who took part in the coalition's discussions on Tuesday. Nimda--which is "admin," the shortened form of "system administrator," spelled backwards--started spreading early Tuesday morning and quickly infected PCs and servers across the Internet. Also known as Readme.exe and W32.Nimda, the worm is the first to use four different methods to infect not only only PCs running Windows 95, Windows 98, Windows Me and Windows 2000, but servers running Windows 2000 as well.The worm spreads by e-mailing itself as an attachment, scanning for--and then infecting--vulnerable Web servers running Microsoft's Internet Information Server software, copying itself to shared disk drives on networks, and appending Javascript code to Web pages that will download the worm to Web surfers' PCs when they view the page.

Much of the worm's virulence is due to its automated spread. The e-mail attachment will open automatically under Microsoft's Outlook e-mail program if the program's security settings are at "low" and a security patch has not been installed. On PCs that don't use Outlook, the worm can still spread using its own e-mail engine, but it won't execute automatically. In addition, the worm generates an avalanche of Internet traffic when it scans local chunks of the Internet for vulnerable servers to which it can spread. The automated scanning caused many connectivity problems for businesses on Tuesday. Other companies' Web servers had become infected with the worm, putting at risk any PC user viewing a Web page hosted on such a server. Yet most businesses seem to be controlling the infections, said Symantec's Weafer. "They have a handle on the initial problem of blocking the virus," Weafer said. "Now it's recovery mode, and that can take weeks and months." Almost 700 customers reported incidents of infections to Symantec on Tuesday, he said, evenly split between businesses and home users.

It's those home users that have antivirus experts worried. Owners of home PCs generally fall behind in securing systems with new software updates and the latest virus definitions for antivirus software, Weafer said. David Dittrich, senior security engineer for the University of Washington and a computer forensics expert, agreed. "The home users are the hardest ones to deal with," Dittrich said. "We have tried to get the word out that they need to do something, but they don't listen." Dittrich said software makers will have to become more pro-active about contacting customers when major security threats like Nimda arise. Rather than post an advisory on a hard-to-find Web site, software companies should send e-mail to customers telling them to update their software immediately. "Somehow, as the number of patches coming out is going up exponentially, the word has to get out to a larger number of people to apply the patches," he said. "In the end, it may be like automakers, with recalls and everything."

HP Adds Digital Photography to All-in-One Printer

Hewlett-Packard Company today introduced the industry's first all-in-one home digital imaging solution that allows consumers to choose and print digital photos directly without the need for a computer. The compact HP PSC 950 all-in-one allows consumers to print photos, create special projects and handle everyday printing, faxing, scanning or copying needs. With the exclusive HP Photo Proof Sheet feature, a user simply inserts a memory card containing photos into the appropriate slot on the HP PSC 950 all-in-one, presses the "proof sheet" button and a sheet with thumbnail-sized photos is automatically generated. The user then selects the photo, paper type and size desired on the sheet and scans it into the all-in-one, which recognizes the user's choices and prints the photos as specified. Consumers can use CompactFlash, SmartMedia or Sony Memory Stick memory cards for printing and also for downloading digital photos directly to the computer without ever having to connect their digital cameras.

"The HP PSC 950 all-in-one is essentially like having a mini-photo lab in the home," said George Brasher, product manager, HP Consumer Business Organization. "This product furthers the transformation from traditional to digital photography, offering consumers greater choice, control and convenience." The HP PSC 950 all-in-one features the same award-winning technology available in HP inkjet printers commonly used by small-office and home-office professionals. The device produces 2400 x 1200-dots per inch (dpi) color images on photo paper to deliver photo reprints that look virtually identical to the original. It prints up to 12 pages per minute (ppm) in black and up to 10 ppm in color. For additional convenience, the HP PSC 950 all-in-one comes equipped with a 4 x 6-inch photo tray.In just a few simple steps, home users can add brilliant color photos and drawings to their documents to create letters, cards, school reports or other creative projects. The HP PSC 950 all-in-one features exceptionally high-quality scanning with 600 x 1200-dpi optical resolution, 9600-dpi enhanced resolution and 36-bit color.

It also includes optical character recognition (OCR) software, which allows users to edit hardcopy text documents by scanning and converting them into electronic files.The HP PSC 950 all-in-one delivers photo-quality copying at speeds of up to 12 copies per minute (cpm) in black and nine cpm in color. The copying feature allows users to create special projects without a computer. For example, users can create multiple wallet-size photos from one original, make reductions and enlargements, print posters and copy two originals onto one page. The flatbed design allows users to scan or copy virtually anything, such as books and other 3D objects. The device also features a flatbed fax -- designed for sending short faxes of approximately one to three pages. It can receive faxes of any length. The HP PSC 950 all-in-one is expected to ship to retailers in the U.S. in September with an estimated U.S. street price of $399. It comes with a one-year limited warranty backed by HP Customer Care service and support.

Thursday September 20, 2001 Top

Via Sues Intel Over Pentium 4

Taiwanese chip maker Via Technologies stepped up its legal battle with Intel Thursday, filing a lawsuit that seeks to halt sales of Intel's flagship Pentium 4 processor. Via and its subsidiary Centaur Technology filed suit against Intel in the Federal District Court for the Western Division of Texas (Austin Division), where Centaur is based, alleging that the Pentium 4 violates a Centaur patent. The lawsuit seeks to stop sales of the Pentium 4 and requests that monetary damages be paid to Via and Centaur. The action follows a barrage of suits filed in Taiwan earlier this month, in which Via alleged that Intel illegally pressured motherboard makers not to buy Via's Pentium 4 chipset, and that Intel employees destroyed promotional materials--such as balloons--advertising the chipset. The Texas lawsuit claims that the Pentium 4 violates Via and Centaur's U.S. Patent Number 6,253,311, jointly owned by the two organizations, which deals with formats in which numeric data may be stored on a microprocessor. Via said the move was designed to protect the company's rights as it moves from chipsets into the microprocessor market. "Filing this lawsuit is the first step in protecting our intellectual property rights," said Richard Brown, Via's director of marketing, in a statement. Via purchased Centaur from California-based Integrated Device Technology in 1999. Centaur technology powers the C3 processor, launched on 10 September.

Nimda Worm Begins to Slow Down

Companies infected with the Nimda worm worked at cleaning the malicious program out of their computer systems Thursday, as the worm's spread continued to slow. "From within six hours after it got going, we saw it retreat," said David Moore, senior researcher with the Cooperative Association for Internet Data Analysis, a supercomputing center at the University of California at San Diego. The spread of the virus peaked around noon Tuesday and has slowly decreased since then, according to CAIDA's analysis. "The response (to Nimda) was faster and more effective than the response to Code Red," Moore said. On Tuesday, the day the worm started to spread, the number of infected computer systems detected by CAIDA quickly climbed to a peak of 150,000. By Thursday, that number had dropped to almost 50,000. Antivirus software companies said new infections were far less common 48 hours after the Nimda worm started to spread. "Most of what we're dealing with today is company cleanup," said Vincent Gullotto, director of Network Associates' antivirus emergency research team. "The spreading has really started to die down. We will get new reports, but nothing near what we got that first day." The retreat of the worm came as little comfort to some companies and organizations affected by the virus.

Microsoft Opens Up Passport Service

Microsoft will extend its Passport authentication service to the broader business market, which could potentially include its rivals, in an effort to build acceptance for its service and allay privacy concerns. The Redmond, Wash.-based company on Thursday announced a plan to revamp its 2-year-old Passport service, which lets consumers log in to Web sites. Microsoft plans to make the service more appealing as a way to conduct business e-commerce transactions between Web sites. It will be used in a manner similar to how Cirrus and other banking networks globally link automatic teller machines worldwide. To allay mounting privacy concerns, Microsoft said it plans to allow organizations to retain control over user identities, profiles and other business data held by Passport. Microsoft will also revamp Passport to use Kerberos, a standard for network security, to provide a single sign-on authentication service that can be used on multiple Web sites. Kerberos is already supported by Microsoft in its Windows operating system. The software was developed by the Massachusetts Institute of Technology. In Microsoft's plan, businesses--which potentially include Microsoft rivals--will adopt Passport as their log-in system for business-to-consumer and business to-business transactions.

Microsoft also will allow third parties, such as telecommunications service providers, to register Passport members or create trusted links between proprietary networks and a Passport-centric marketplace. In the end, a large federation of Passport-powered sites will form a huge marketplace, Microsoft hopes. "Almost every Web site that wants to do robust personalization or secure access to data has its own authentication system, but a lot of Web sites don't have to be in the authentication business," said Brian Arbogast, vice president of .Net core services at Microsoft. "Our goal is to lay the foundation that will allow mass adoption of Web services." To help ensure the proliferation of Passport, Microsoft is loosening the reins of control. In the future, third parties will be able to manage Passport credentials, Arbogast said. Microsoft will still host the actual authentication process. "We don't believe that Microsoft or any one company will be the only authorization provider on the Internet," he said. "We will allow Passport to accept credentials from other services and allow other services to give Passport identities."

Analysts Believe Microsoft and DOJ Closer to Settlement

The Justice Department, 18 states and Microsoft on Thursday filed a joint status report with U.S. District Judge Colleen Kollar-Kotelly at her request. In some ways, the legal filing demonstrates just how far apart the two sides remain. While Microsoft and trustbusters agreed on some issues, most related to legal or filing procedures and not to substantive scheduling or discovery. The two sides could not come to an agreement on a proposed schedule. If the government proposal were to be accepted by the judge, the hearing to determine what to do about Microsoft's antitrust violations would commence Feb. 4, 2002. Until then, both parties would engage in a period of discovery and testimony for the purpose of helping Kollar-Kotelly draft an appropriate remedy. Kollar-Kotelly is expected to address the proposed schedules in a hearing set for Sept. 28. The judge has delayed the filing not once, but twice, because of the devastating terrorist attacks in Washington and New York. But even as Microsoft and the government prepare to return to court, legal experts warn the likelihood of settlement has increased significantly during the last three weeks.

In drafting the order, both sides had to communicate more. The government's discarding breakup and tying claims also removed significant hurdles for Microsoft. If both sides draft an agreement, given the economy and other factors, "I think the public would largely applaud," Stanton said. "There may be industry participants that would say it was inadequate." In Thursday's filing, the two sides gave little indication about the prospects for settlement. The parties "will continue to seek settlement of this matter through private discussions, which are ongoing and should continue simultaneously with proceedings addressed to remedy," the brief states. For Microsoft there may be no better time to push hard for settlement than right now, said Rich Gray, a Silicon Valley antitrust lawyer closely watching the trial. "Microsoft is never going to have a more favorable administration," he said. "They're never going to have a more favorable antitrust prosecutor...They're never going to have a more favorable economic environment, in the sense they're a leading light of the tech world when the tech world is in a downturn. And they're never going to have a more favorable moment in history, when the attention of the world is distracted by far more serious issues."

New Microsoft Licensing Program Likely to Hit Companies Hard

As previously reported by CNET, Microsoft on Oct. 1 will dramatically change how it licenses software to its largest customers. That change will drive up what they pay for products such as Office XP or Windows 2000 between 33 percent and 107 percent, according to market researcher Gartner. Many customers also are finding they have to buy new versions of Office even to qualify for the new licensing program. With market share of more than 90 percent in both desktop productivity applications and operating systems, Microsoft is able to charge more in a way it couldn't in a more competitive market, say analysts and the company's customers. Some Microsoft customers--many of which are companies not even halfway through their 2001 fiscal year--are outraged with the changes, which the software giant announced in May. Ray Bailey, information services manager at a electronic component manufacturer Bergquist Company, said he is "disappointed that Microsoft has been so aggressive in its (licensing) program. We have to pay because we have no choice. Why couldn't they give us some more time to do it gracefully?"

By eliminating certain options under the new licensing program, some technology managers contend they no longer have the choice to upgrade when they want. Instead, they feel railroaded into buying expensive maintenance contracts from Microsoft. Bill Henningsgaard, Microsoft's vice president of worldwide licensing and pricing, defended the changes. "I think customers have choice. They had choice before, and they have choice going forward." Some analysts and customers disagree."On the desktop, there really aren't alternatives," said Gartner analyst Neil MacDonald. "Microsoft knows that people don't have a choice for desktop operating systems and productivity applications." IDC analyst Al Gillen agreed. "If there were a lot of alternative choices on the client systems, it would be much more difficult for Microsoft to implement licensing programs with such limited choices for the users," he said. "Basically, Microsoft is twisting its customers' arms, and I can't believe its customers are thrilled about this."

There are alternatives to Microsoft's Windows and Office software, including the Linux operating system and Sun Microsystems' StarOffice productivity package. But the vast majority of businesses have standardized on Microsoft's products, making migrating to a rival product difficult. "There aren't a lot of alternatives for desktop productivity," MacDonald said. "Corel (WordPerfect) is a weak competitor and so is StarOffice." The new licensing policies, however, could lead to businesses taking a second look at alternative products. No customers contacted by CNET said they planned to evaluate alternative applications. For customers who upgrade every two years, software costs would actually go down 19 percent, analysts concluded. But the majority of customers--particularly those buying Office--typically upgrade every four years. "Microsoft claims that over 50 percent (of customers) will see no change in costs, which is not true," LeTocq said. "Microsoft has been using changes in licensing terms as a way to generate revenue for years," MacDonald said. "It allows Microsoft to come in under the radar screen with something not as blatant and obvious as raising the prices." He warned Microsoft customers to expect more aggressive licensing changes in the future.

Friday September 21, 2001 Top

Microsoft Releases Software to Check Windows XP Compatibility

With the launch of Windows XP just around the corner, Microsoft is trying to help consumers transition to the new operating system. On Friday, the Redmond, Wash.-based software giant said it is making tools for consumers available for download from its Windows XP Web site. The 35MB file allows people to check for compatibility with their current hardware and software. The official launch of the OS is set for Oct. 25, but PC makers will begin selling new systems with the OS on Monday. A smooth transition to the new OS for consumers could be vital to the success of the new OS, as well as to the tech sector in general. As part of that transition, the software giant has been working with hardware and software companies to ensure that Windows XP is compatible with the most popular devices and applications on the market. The company has been conducting tests itself and providing tools to developers to make sure applications can run on the upcoming OS.

Microsoft said it has invested more than $150 million in its compatibility efforts and has more than 600 employees worldwide conducting compatibility tests. The company plans to support about 12,000 third-party devices and more than 6,500 applications. Microsoft has also created a logo program, Designed for Windows. Companies that pass compatibility tests will be granted the right to display the logo on their products. Many in the technology industry are counting on Microsoft's new OS to be the shot in the arm that Windows 95 became. PC makers in particular are hoping that the new OS will prompt consumers to purchase new PCs. But Gartner analyst Martin Reynolds says XP probably won't have much of an impact. "XP doesn't give users a clear reason to replace their current PCs...It's not as big an advance as Windows 95," Reynolds said. At the same time, he added that "longer term, it will create a word-of-mouth momentum, and that may create interest in a new PC."

New Technology Could Double or Triple DSL Speed

An emerging high-speed Internet standard in Europe holds potential for faster download speeds and broader availability for many U.S. businesses--if they're willing to wait a while. Although DSL speeds vary widely, the new G.SHDSL could be two to three times faster than most versions of DSL targeted at business customers. The G.SHDSL standard also can deliver data farther than earlier DSL technologies, which are limited to a relatively short distance. Some European communications carriers are using the faster DSL (digital subscriber line) technology on a limited basis. "The European market will see this. And the (U.S. local phone companies) are looking at deploying it to replace their business offerings now," said Pat Hurley, a DSL analyst at TeleChoice, a communications industry market research firm. G.SHDSL is short for the formal single-pair, high-bit-rate digital subscriber line, more casually known as symmetric high-speed digital subscriber line. Approved by the International Telecommunication Union in February, G.SHDSL is a standard for a DSL technology capable of speeds of 2.3mbps (megabits per second), or up to 4.6mbps in some cases.

The data-transfer speeds are symmetric, meaning people can download and upload information at the same rate. Some versions of DSL technology offer faster downloads than uploads. The new technology also can be delivered to customers farther than 18,000 feet, or about 3 miles, from the phone company switching facility by using repeaters--equipment that boosts the signal over distances. With other versions of DSL, this approximately 3-mile distance has limited the number of consumers and businesses capable of getting high-speed Net service in the past. DSL signals typically degrade over distance, limiting the download speeds for some faraway customers. Analysts and industry experts believe G.SHDSL will eventually replace today's DSL options, which primarily target either consumers or small businesses. "It is being deployed in Europe today. They've just finished some of the trial phases," said Mark Peden, a member of the board of directors for the DSL Forum, a nonprofit organization to promote DSL. "What's going on in the U.S. is there are a number of lab trials with G.SHDSL. Competitive carriers have indicated that they plan to transition to it once it becomes available."

Yamaha Announces New Internal and External CD-RW Drives

Yamaha Electronics Corporation announces the introduction of the industry's first 20X internal and external ReWritable CD recorders. The LightSpeed2 CRW2200 Series models are capable of recording on CD-R discs at a top speed of 20X, writing a full CD in under four minutes; rewriting CD-RW discs at a top speed of 10X; and reading CDs at a sustained maximum rate of 40X. In addition, the CRW2200 Series allows users to rip audio CDs at a maximum speed of 40XĐup to 66 percent faster than conventional CD-RW recorders currently in the marketplaceĐallowing digital audio extraction of a 74-minute audio disc in less than three minutes. "Yamaha continues to be a leader in the CD recording industry," states Allen H. Gharapetian, general manager, Multimedia Products Division, Yamaha Electronics Corporation. "We have also included an external USB 2.0 model in this series. This breakthrough product will create even more consumer interest in a market that is already projected to grow by 42 percent this year."

To achieve 20X CD-R write speed, Yamaha developed the CRW2200 Series to take advantage of Partial Constant Angular Velocity (P-CAV) technology, a combination of CAV and standard Constant Linear Velocity (CLV) technology, for optimum performance. The CAV recording method keeps the disc rotation speed constant while adjusting the data transfer rate depending upon which portion of the disc is being recorded."Unlike other high-speed CD-RW recorders, our Lightspeed2 recorders do not compromise quality for speed," says Gharapetian. "By employing Partial CAV, our CRW2200 maintains a constant and controlled rotation speed during recording to the inner tracks on the disc. This reduces vibration that prevents data corruptions." In addition to utilizing conventional CLV recording at 2X, 4X, 8X, and 10X in rewriting mode, the CRW2200 also supports the 4X-10X CAV mode. This permits high-speed random writing/reading of data and realizes floppy disk-like ease of operation using packet writing.

Yamaha CRW2200 CD-RW recorders will also be the first CD recorders to use the Yamaha SafeBurn System with its exclusive Triple Protection Architecture. The SafeBurn System provides the new recorders with an advanced buffer underrun control system, an 8MB buffer and Yamaha's Optimum Write Speed Control which, by checking a disc's capability and the recording conditions, allows LightSpeed2 recorders to select the optimum writing speed to further improve reliability. Yamaha's new LightSpeed2 family features five models: the internal CRW2200EZ using E-IDE (ATAPI) interface, the internal CRW2200SZ using Ultra SCSI (SCSI-3) interface, the external CRW2200SXZ using Ultra SCSI interface, and the external CRW2200FXZ using IEEE 1394 FireWire technology are currently shipping; and the external CRW2200UXZ with USB 2.0 interface will be available in the fall. The FireWire connection provides simple installation, reliable performance and fast recording speeds. All models are compatible with IBM PC. The external drives are compatible with Macintosh computers.

Microsoft Provides "Family Licenses" for Windows XP

Microsoft confirmed Friday that it will offer discounted versions of Windows XP for home users who want to install the new operating system on several PCs. "Some people have multiple PCs at home, and this allows them an easy way to put them on multiple machines," said Jim Cullinan, Windows XP lead product manager. People can purchase additional "family licenses" at the time they buy Windows XP, either the upgrade or the full version, Cullinan said. The licenses are expected to cost $10 to $30 less than the full product price. Later on, Microsoft plans to make the licenses available online and to offer additional license options with some networking products. The discount is an attempt to compensate for a new security feature in Windows XP, Product Activation, which will for the first time prevent home users from installing the same copy of the software on multiple PCs. Product Activation will also require customers to obtain a code to reactivate the software if the computer Windows XP is installed on is significantly upgraded or if the hard drive is reformatted and the operating system is reinstalled.

New Support for Anti-Encryption Laws Comes after Terorrist Attacks

A poll in the United States has found widespread support for a ban on "uncrackable" encryption products, following proposals in Congress to tighten restrictions on software that scrambles electronic data. The survey found that 72 percent of Americans believe that anti-encryption laws would be "somewhat" or "very" helpful in preventing a repeat of last week's terrorist attacks on New York's World Trade Center and the Pentagon in Washington, D.C. The poll, conducted by Princeton Survey Research Associates on Sept. 13 and 14, reveals that the question of banning encryption tools without "backdoors" for government interception is under serious debate in the United States. Congress was quick to blame sophisticated encryption methods for the massive intelligence failure last week and is proposing that government officials should have backdoor access to encryption products to aid national security. The Princeton survey found that more than half of the American public would support anti-encryption laws to aid law enforcement surveillance powers. Only 9 percent of those questioned believed that tighter encryption restrictions would not prevent similar terrorist attacks in the future. But privacy groups have accused Congress of political and economic opportunism--influencing public opinion while the nation is still coming to terms with last week's unprecedented events.

"No one should ever trust figures collected in the aftermath of a disaster; people are confused and emotional and will be led easily by imagery," said Simon Davies, director of human-rights group Privacy International. "It would be extremely irresponsible to shape public policy in response to a tragedy." In the United Kingdom, the Home Office is scheduled this winter to enforce the final stages of the Regulation of Investigatory Powers Act (RIPA), which will grant law enforcement the power to demand decryption keys from the place where data is encrypted. Privacy groups are concerned that Britain's enthusiasm for a unilateral global approach toward surveillance could re-energize the key escrow debate. Key escrow is a controversial mechanism whereby individuals and businesses must lodge a decryption key with a government-appointed body in case law-enforcement officials need to decrypt the data. "I expect that the U.K. government will do everything in its power to claw back the ground that they lost in the public debate over RIPA," Davies said. "If it means subverting and amending legislation, the Home Office will propose this, and it will go through Parliament on the nod. Such a move would be a travesty and subvert the democratic process."

Weekend September 22 & 23, 2001 Top

Six States Join in Support of Government Antitrust Case

The attorneys general of six states on Friday added their support to the government's antitrust case against Microsoft and expressed concerns about how the company's new Windows XP operating system will affect competition in the software industry. In a letter sent to Microsoft Chief Executive Steve Ballmer, Vermont's William Sorrell and five other attorneys general said they wanted to "add our voices to those calling on Microsoft to remedy the antitrust problems that are now evident." "We are concerned that Windows XP may involve additional unlawful attempts by Microsoft to maintain its operating system monopoly," Sorrell wrote in his letter to Ballmer. The attorneys general from Arkansas, Maine, Montana, New Hampshire and Rhode Island all co-signed the letter. None of them are among the 18 states that have joined the Justice Department case against Microsoft. "We agree with our colleagues, the litigating states and the federal government, that any anti-competitive aspects of Windows XP should be addressed," the letter said. Microsoft's allies in the software industry dismissed the letter as a ploy drafted by a lobbyist for the company's archrival, AOL Time Warner. One pro-Microsoft trade group, the Association for Competitive Technology, called it "tactless" and said it was AOL's "latest and lowest attempt to prolong and even expand this saga." AOL spokesman John Buckley said the company was "wholly uninvolved with the letter." Regardless, the show of support from the additional six states could bolster the government's position as the case heads into a critical remedy phase before U.S. District Judge Colleen Kollar-Kotelly. It also could strengthen the government's case if it decides to ask Kollar-Kotelly to order changes to Windows XP. Some state attorneys general have expressed concerns that some of the features in the new operating system, such as a media player and instant messaging, could hurt competition in the software business.

Congressman Pushes for More Encryption

A U.S. lawmaker well versed in technology issues said Friday that government bodies and citizens should use more encryption, not less, to increase security on the Internet. In the wake of last Tuesday's hijackings that left more than 6,500 Americans dead or missing, policy-makers have called for limits on popular encryption software that allows users to scramble Internet communications for privacy. The Central Intelligence Agency said earlier this year that encryption software was in use by radical Islamic groups such as Osama bin Laden's al Qaeda, believed to be behind the attacks last week. But Rep. Bob Goodlatte, R-Va., said after a Capitol Hill panel on Internet security that proposed remedies such as "trapdoors" to allow government surveillance would effectively make Internet communications less secure. "That's like telling people to take their house key down to the police station," Goodlatte said. "People are not going to have greater confidence in their security by doing that." Goodlatte led congressional efforts several years ago to loosen export controls on encryption technology, ultimately prevailing over opposition from the National Security Agency and the FBI. Reimposing export limits would not limit the availability of encryption software, as it is widely available overseas, he said. Instead, it would place U.S. software companies at a competitive disadvantage. Goodlatte said more U.S. businesses and government agencies should use encryption to guard against future computer-based attacks that could disable power plants, banking systems and other critical infrastructures. Goodlatte said he would bring his concerns to Pennsylvania Gov. Tom Ridge, who was appointed yesterday to head U.S. efforts to defend against terrorism.

Nimda Worm Removal Proving Difficult

Security consultants stressed Friday that, while the spread of the disruptive Nimda worm has slowed, many companies are having difficulties rousting the malicious program from their networks. "It's an awfully insidious little bastard," said Mike Scher, senior research consultant with network protection company Neohapsis. "You clean it off of one segment of the network and have to make sure it doesn't come back. It's almost like fighting a fire." After successfully preventing Nimda from entering its network, Scher's client--a Forture 500 company--picked up the worm from an employee working from home. After that, the program spread quickly throughout the corporation's worldwide offices. "This is a huge organization, so there are lots of infections," said Scher, who had been working 48 hours to clean the digital infestation from the network. "It's a terrible pain to get off." The tenacious worm also caused several Internet service providers to take drastic steps to block customers from spreading the worm and overloading their networks with traffic.

XO Communications acknowledged on Friday that the company severed almost a quarter of its customers' Web servers from the Internet in an attempt to halt the deluge of data produced by the worm. "Many of our customers are small businesses," XO Communications spokeswoman Jenna Dee said. "They bring in an IT person to set up their network and don't have a full-time technical employee. Those types of businesses are the most susceptible to these attacks." Another Internet service provider,, completely cut off hundreds of its customers after it became apparent that their computers had been infected by the worm, according to customers' reports. did not immediately respond to requests for comment. The latest information shows the Nimda worm's extensive replacement of key files and programs on infected PCs and its use of Windows file sharing to spread across local area networks have made it very hard to clean out.

File-Swapping Services Face Financial Problems

Droves of Napster clones are proving that it's still cheap and easy to create file-swapping services under the nose of the entertainment industry--but such ventures promise mostly high risks and little pay for the people behind them. Even as the U.S. courts have effectively shut down file-trading giant Napster, numerous would-be replacements have taken root. Most hope to avoid legal entanglements and eventually profit on the immense popularity of services that offer free access to popular music, videos and other files. Like the evanescent "eyeballs" that lured venture capitalists to sink billions into failed dot-coms, the staggering number of consumers signing up for file-swapping services has been a siren's call to developers. Already, millions of people have migrated to start-ups such as MusicCity, Audiogalaxy and Aimster. But popularity also brings financial pressures, and file-swapping companies are increasingly resorting to creative ways to make money through advertising, subscriptions and other fees.

Still, the reality so far is that these start-ups have demonstrated little economic potential. Although file-swapping technology poses a potent threat to the entertainment establishment, analysts say the companies developing and marketing it face enormous obstacles if they ever hope to break out of subsistence-level operations. The two most popular companies in the business are now Audiogalaxy and MusicCity, with its Morpheus software. Each has stepped up efforts to make money in recent weeks, however. Audiogalaxy has added a $2.95-per-month subscription option that it says will provide faster page loading and more stable service. Like Kazaa and BearShare, the company has also long bundled third-party "adware" with its download, which installs advertising software on a consumer's PC. MusicCity has added progressively more advertising in the past few months, with pop-up windows and banner ads becoming a regular part of the software program.

Executives have previously spoken of a new version of the service under development that would add more Internet communications services to the software as a possible source of revenue. Several companies, including iMesh and Kazaa, bundle advertising software that adds links to ordinary Web pages, much like "smart tags," which Microsoft developed but removed from its upcoming XP operating system after some controversy. Installing this software will underline regular words on pages and link to a company that has bought that keyword--online real-estate agent service for the words "home buying," for example. According to eZula, one of the companies that provide this technology, an advertiser can pay up to 30 cents to $1 when a consumer visits its site through such a link; a peer-to-peer network that distributed the software can get 20 percent to 50 percent of this revenue.

Via Selling C3 Processor "In a Can"

Via Technologies is canning its C3 processor, literally. The Taiwan chip maker, better known as the second-largest chipset manufacturer after Intel, has come up with a new marketing strategy for its latest attempt to grab some of Intel and AMD's market share in the desktop PC market: it will sell a "limited edition" version of the C3 processor in a brightly-colored, 7.3-cm-tall alloy can. The contents of this "Cool Chip In A Can" packaging, designed to stand out from competitors on retailers' shelves, will be the same as normally-boxed versions. The marketing move echoes previous products that have used unusual packaging to help catch the consumer's eye. However, innovative packaging is usually reserved for software such as games. The special edition emphasizes Via's focus on consumers. The chip, manufactured to a smaller, more efficient manufacturing process than competitors, is designed to be low-cost while maintaining high performance.

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