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March 30, 2007

New cruise amenity: Wii video games

Posted by Benjamin J. Romano at 11:16 AM

Norwiegan Cruise Lines announced yesterday that it will be outfitting all of its ships with Nintendo Wii video game consoles. The move speaks to the multi-generational appeal of the next-generation console, which uses a motion sensitive controller that people newer to video games find easier to handle.

"With its active, engaging and inviting game experiences appealing to every age from kids to parents to grandparents, the Wii from Nintendo is a natural fit for Freestyle Cruising," Colin Veitch, the cruise line's president and CEO, said in a press release. "With the addition of Wii to our on-board activities, we can now offer bowling, boxing, golf, tennis and baseball across the entire fleet. Cheering, yelling and high-fives will be highly encouraged."

The consoles will be in public places equipped with large projection screens. The ships will hold tournaments and other events around the Wii, the cruise line said.

This New York Times story talks about the different ways seniors are getting into video games, including a retirement home where nuns play Bejeweled. A spokesperson for Seattle's PopCap Games, which makes Bejeweled and others, conveyed these statistics: "71 percent of its players were older than 40, 47 percent were older than 50, and 76 percent of PopCap players were women."

Our own Kim Peterson wrote about the trend of baby boomers playing casual games a few years ago.

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March 29, 2007

Amazonian expansion

Posted by Monica Soto at 3:21 PM

This perhaps doesn't make him the Prince of Wales, but a British Web site today reported that's Jeff Bezos plans to add 1,200 jobs in Wales.

This is the largest job-creation project there since 2000.

Amazon runs the U.K.-based online store.

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CTIA: Hail to the (former) chiefs

Posted by Tricia Duryee at 9:45 AM


Former Presidents Clinton and Bush appear at CTIA Wireless show in Orlando.

ORLANDO, Fla. -- On the last day of the CTIA show, what seemed like every attendee stood in line for about an hour to get a seat to hear George H.W. Bush and Bill Clinton, the 41st and 42nd presidents.

The standard practice at CTIA is to have a panel discussion by carrier CEOs on the final day, which never seems to draw a big crowd. Today, the room was packed with people sitting in the aisles.

Security was tigh,t with photographers required to drop off their equipment at 6:30 in the morning for inspection and not pick it back up until 9.

The presidents teased each other, and discussed how the wireless industry was affecting their lives and the world.

Bush said people call him and Clinton the "odd couple," and he asked Clinton what are you doing with that right-wing nut Bush?

Bush's serious answer was that they wanted to come together for Katrina and tsunami efforts -- to get something out of life that's bigger than politics.

Bush talked about how he was hooked on his BlackBerry. When he's at a Houston Astros baseball game, he enjoys getting e-mails from friends saying that they can see him on TV. He gets kicks by replying that he'll wave after the next strike.

"When you are 83, you'll do the same thing," he said.

Clinton stressed how wireless could unite the world and show people their commonalities rather than their "destructive personalities." He warned the wireless industry if it isn't careful it could empower terriorists to plot terrible events.

"You should be proud to be a part of an industry that is bringing people together that could otherwise be pulled apart by destructive pesonalitie," he said.

Irnonic how things change. I recall when Bush was just leaving office that he was blown away by grocery scanning technology on a media trip to a supermarket. And today he's using a BlackBerry and knows how to use a computer to reply to e-mails -- even changing the font color to add emphasis to what he is saying.

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March 28, 2007

Redefining first-person shooter

Posted by Benjamin J. Romano at 4:50 PM

Here's ammunition for any sarcastic contrarians arguing that video games reduce violence in the real world: In Mexico City, Reuters reports, the new mayor is trading Xbox video game consoles for guns as part of a broader crime-fighting effort.

Details from the Reuters story:

Launching the program Tuesday in the notorious inner-city barrio of Tepito, which police stormed last month, city police chief Joel Ortega said anyone who turns in a high-caliber weapon like a machine gun will get a computer.

Owners can swap smaller guns for cash or Microsoft Corp.'s Xbox video-game consoles under the plan. ...

Organizers say they have 100 computers ready for the first wave of the program, each worth 8,500 pesos ($769) and equipped with software donated by Microsoft. On the first day, Olayo said the city received 17 guns, including 12 from Tepito.

The police action there of late sounds like the stuff of a first-person shooter: "Last month police stormed Tepito, a warren of scruffy homes and market stalls a few blocks north of the capital's main square, seizing a tenement complex known as 'The Fortress' -- reputedly a major cocaine and marijuana distribution center."

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CTIA: Tegic's music player

Posted by Tricia Duryee at 12:16 PM

ORLANDO, Fla. -- Tegic Communications, a Seattle-based division of AOL, has been quietly talking about a portable media that it expects to launch this summer.
It's made the rounds to all the conventions -- to CES, 3GSM and now CTIA.

The player uses the Linux operating system, but incorporates software built by Kirkland-based Wildseed, which AOL bought a couple of years ago.

Michael Wehrs, vice president of product management, showed it to me in February and updated me on the player's progress last week.

From what I understand, the device will be less restricted than most music players today. Its underlying software, called Smartscreens, allows users to stream or download music or videos to the device over a Wi-Fi or Bluetooth connection. The device can also be connected to a computer by a cable, which is the standard today.


The Tegic media player was on display at Haier's booth. Haier is manufacturing the product, due out this summer.

Tegic expects to launch the 30-gigabyte music player with hardware maker Haier by July, but has not yet disclosed the name or the price, or which music service it will use.

I snapped a quick photo of the player at the Haier booth yesterday, and thought it was worth sharing. Nothing fancy really, especially for all the stuff loaded inside -- even a full Web browser.

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CTIA: Mobile search wars

Posted by Tricia Duryee at 12:03 PM

ORLANDO, Fla. -- I talked to Lee Ott, Yahoo!'s director of product strategy Tuesday, and he made some pretty bold claims.

He said Yahoo! will become No. 1 in mobile search by completing three tasks.

1. Yahoo! must build out the company's mobile index of content to make it appealing for consumers to use. After all, if they can't find what they are looking for, they'll search somewhere else.

2. Yahoo! must increase the number of users it has mostly by making the best product.

3. Yahoo! will finally take the best product with the most users and monetize it. If you have one of the most used sites, advertisers will be willing to pay, he said.

I thought these were pretty bold statements, especially since it's only Yahoo!'s second year at CTIA. And its booth is in shouting distance of the other two search giants -- Google and Microsoft.

Then again, maybe Yahoo! does have something to yell about. According to Telephia, a mobile research firm, Yahoo! Mail is the number one most visited site on a mobile phone.

It must be doing something right.

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CTIA: The jaw drop

Posted by Tricia Duryee at 11:41 AM

ORLANDO. Fla. -- One of the things I've enjoyed doing most the past couple of days is telling people -- mostly from Seattle -- that local company Speakeasy is being acquired by mega-retailer Best Buy.

The news provokes great reactions: Faces contorted, they say, "WHAT?!"

These reactions have been on the faces of multiple venture capitalists, analysts and local business owners.

Read my story to find out what Speakeasy, which provides Internet and phone services to small business, has in common with Best Buy.

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CTIA: Day 2 keynotes

Posted by Tricia Duryee at 6:55 AM

ORLANDO, Fla. -- Today's keynotes so far have included executives from Viacom and Visa.

Viacom CEO Philippe Dauman covered a lot topics, ranging from a new video service with Sprin to a new mobile game created by Seattle-based RealNetworks.

A Tech Tracks reader asked if I knew what RealNetworks was doing at the show. In addition to two announcements made on Monday that it will provide music services to Rogers in Canada and Helio, Real announced today a new mobile game based on the Comedy Central show "South Park."

I tried it out last week. There are 10 levels, one for every season of the TV show. Each level is based on something that happened in each season. In one you have to avoid getting hit by a woman throwing Bibles.

Comedian Will Ferrell also made a brief appearance on the big screens to introduce a new text messaging service surrounding the release of his new movie, "Blades of Glory."

In the next keynote by John Philip Coghlan, president and CEO of Visa, the hot topic was using the cellphone as a debit or credit card.

A short video on the technology featured professional swimmer Michael Phelps, who just broke a world record Tuesday. He makes purchases in a deli, checks his balance and sends money to his mother, all with a few clicks or by swiping his phone in from of a reader.

Coghlan said in the U.S. today there are 30,000 merchant locations that have the technology. He promised that number would grow quickly.

He shared a few interesting statistics based on a survey Visa conducted:

-- 57 percent said they were interested in making mobile payments.
-- 90 percent of those interested in mobile payments would pay more for a device with payment capability.
-- 64 percent of the people 18 to42 would consider switching carriers if they offered mobile payments.
-- 58 percent of consumers in the same age group would consider switching banks if they offered mobile payments.

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CTIA: Music turning up

Posted by Tricia Duryee at 6:46 AM

ORLANDO, Fla. -- Today, I wrote about how music in the mobile industry could be at an inflection point.

With the imminent launch of the iPhone, the rise of music phone sales, and Sprint Nextel's move to lower the price of song downloads to 99 cents each, the industry could be ripe for strong growth.

I had asked Sprint how many songs were downloaded over its network at the current price of $2.50 each.

The answer came in this morning (a little too late to make my story -- 15 million songs have been downloaded at the Sprint Music Store.

The new pricing will take effect in April.

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CTIA: The WiMax effect

Posted by Tricia Duryee at 6:40 AM

ORLANDO, Fla. -- There are a million things going on at once at CTIA.

The LG booth, for instance, appears to be as many as three stories high and has the effect of waterfalls cascading down the side. Loud techno music pumps from the booth, making it what I believe might make the largest and most eye-catching of all on the floor. Perhaps Samsung's or Ericsson's come in second and third -- for sure on size alone.

But those aren't the things really stealing the show.

WiMax is.

In the three years I have been covering CTIAs, this is the first time WiMax has had a significant presence.

Motorola is hosting a panel discussion on the topic today; there ares standalone WiMax booths on the floor for network equipment; Sprint Nextel disclosed Monday where it will launch the next dozen or so markets for its WiMax service; and I even ran into Clearwire's CEO Ben Wolff, who was cruising the floor.

The consensus is that the WiMax-at-wireless-shows trend started in Feburary at the 3GSM show in Barcelona, Spain. Folks at Motorola said it was there that Vodafone was quoted in one of the major papers as saying carriers should be very afraid of WiMax -- or something along on those lines.

From then on, WiMax supposedly was the topic of conversation.

The increased presence may be a sign of the technology's maturity.

WiMax World, the annual trade show dedicated to wireless broadband, is typically held in Boston every year in the fall. This year, the show has moved to Chicago (Motorola's back yard) because of the increased number of attendants.

Perhaps, the 3G carriers will show up there?

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March 27, 2007

Netflix head, newest MSFT Director, talks to WSJ

Posted by Benjamin J. Romano at 12:08 PM

We asked for an interview with Netflix founder, chairman and CEO Reed Hastings yesterday after Microsoft announced he is joining its board of directors. A Netflix PR guy said Hastings wasn't doing interviews on the directorship.

The Wall Street Journal has an interview with Hastings, apparently conducted earlier, that's worth reading to get a better sense of the new face on the Microsoft board. It's focused on Netflix, changes to the video distribution model and tensions between the tech and entertainment industries.

It also includes a list of "5 Movies with Leadership Lessons Recommended by Reed Hastings." "Animal House" makes the cut because, "Occasionally, a resourceful plan passionately executed can lead to victory against seemingly superior competition."

For more, check out Seattle Times retail reporter Monica Soto Ouchi's coverage of the National Retail Federation's 96th Annual Convention & Expo in New York where Hastings unveiled the new Netflix streaming video service.

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CTIA: Opening day keynote

Posted by Tricia Duryee at 6:57 AM

ORLANDO, Fla. -- Apple's iPhone made a very brief appearance today during the keynote by AT&T's Chief Operating Officer Randall Stephenson.

It is AT&T's wireless division -- the former Cingular Wireless -- that will host the exclusive launch of the iPhone in June.

Stephenson pulled the device out of his pocket, and said: "This is the first time for me to touch one of these -- it will be a test of its ease of use."

For a moment, the cameras zoomed in on his hand, so the attendees sitting in a room half the size of a football field, could see the palm-sized device on large video screens. The screen went from black to the colorful home screen of various icons. But then a second later, the video switched to a pre-recorded iPhone commercial.

Stephenson said 1 million people have asked AT&T to let them know when the phone becomes available.

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CTIA: Local news round-up

Posted by Tricia Duryee at 3:49 AM

ORLANDO, Fla. -- There's so much news, I couldn't fit it into one story. Seriously.

I wrote a round-up of all the local news that's happening today at CTIA -- the big day for announcements.

The story kicks off with the launch of ZenZui, a Seattle coming that spun off from Microsoft to create a new phone user interface that's based on video game graphics.

I also wrote about: M:Metrics, Inrix, OpenMarket, InfoSpace, SNAPin, Tegic Communications and UIEvolution.

Here are the announcements that I didn't mention:

The Bellevue-based Bluetooth SIG, which helps guide the standards process for the technology, said it has released the Bluetooth Core Specification Version 2.1 and EDR. I saw a brief demo last night and the most significant thing seemed to be improved synching capabilities. Right now, it can be difficult to pair a headset and a device. With the new version, whenever you turn on a Bluetooth device in another one's presence, it will automatically ask if you want to pair the two. The group also said that according to a survey released by research firmi Milward Brown, an average of 81 percent of consumers are aware of Bluetooth technology.

On Monday, Seattle-based Formotus, which develops mobile business data
solutions, launched at CTIA. The company also announced its product, FormoPublish, software as a service that helps businesses deploy mobile applications over-the-air to Microsoft smartphones and other wireless devices.

Redmond-based RadioFrame Networks, which makes cell site technology, plans to make two announcements today. The company said its femtocell product, which allows consumers to install mini-cell sites in their home to get better service, said it has built one that provides 2G and 3G voice and data coverage at the same time. RadioFrame also said all its femtocells will integrate into the next generation IP Multimedia Subsystem, a developing IP-based network infrastructure.

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March 26, 2007

New equity funds target profit and social good

Posted by Kristi Heim at 5:20 PM

Two Seattle area organizations announced funds today aimed at expanding the reach of financial services for the poor, while providing attractive returns for wealthy investors.

The Unitus Equity Fund closed today with $23.4 million in capital, making it the largest global equity fund in the microfinance industry fully funded with private capital. The investors are Omidyar Network, Abacus Wealth Partners and Kensington Investments.

Unitus has a unique structure in that it operates both a for-profit equity fund a non-profit grant-making arm.

Ten percent of the fund's profit will go into the non-profit arm of Unitus for grant making. Unitus provides grants to microfinance institutions that offer small loans to the working poor in Asia and Latin America.

The concept of microcredit was pioneered by Nobel Prize winning economist Muhammad Yunus. But organizations like Unitus and Omidyar Network take the concept much further by bringing in commercial capital and large investors to greatly increase the amount of money available for lending.

Seattle-based Global Partnerships today launched an $8.5 million investment fund that combines donations with private capital. Individuals donated $255,000, while a group of socially motivated investors contributed $8.2 million. The fund will be used to expand Global Partnerships' funding to 20 microfinance institutions in six countries throughout Latin America.

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CTIA: The Ducks!

Posted by Tricia Duryee at 3:14 PM

ORLANDO, Fla. -- Who cares about WiMax when there are trained ducks?

While some of us may be still mourning the Oregon Ducks' loss in the NCAA Tournament on Sunday, here's something that could cheer you up:

At the Peabody Hotel across the street from the Orlando convention center, you can check out the Peabody Ducks, which hang out at a central fountain all day.

Twice a day, at 11 a.m. and 5 p.m., the trained ducks march down a red carpet.

Here's a picture of the ducks at rest right before I caught them walking the red carpet at 5 p.m.


The famous Peabody Hotel ducks.

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CTIA: Sprint's moves in WiMax

Posted by Tricia Duryee at 2:41 PM

ORLANDO, Fla. -- Sprint Nextel's press conference started off today with the launch of the Samsung UpStage, but ended up touching on every aspect's of the Reston, Va., company's business.

Coupled with the UpStage launch, Sprint simultaneously announced that it will drop the price of each song downloaded over the air to 99 cents -- an industry first.

Second, its cable joint venture will be known as "Pivot."

And finally, it made some announcements related to its WiMax initiatives, which it calls its 4G network.

-- Sprint said it will partner with Samsung, ZTE and Zyxel for its WiMax devices.

-- It announced 19 new WiMax markets, including Seattle, which Atish Gude, Sprint's senior vice president of mobile broadband, put at the end of the (alphabetical) list of rollouts in 2008.

As far as I could tell, Seattle will be the only market where it will directly compete with Kirkland-based Clearwire. That should be interesting. While some people question the viability of having one WiMax provider, what will two look like?

Additionally, what makes it interesting is that previous reports said Sprint Nextel and Clearwire would work together to not duplicate efforts and roll out in different markets.

When I asked Gude about this, he had this to say:

Clearwire, who?? That's a joke. We have had a business plan for quite some time and we are diligent in following it. They [Clearwire] are following a different model -- one of fixed WiMax. We are about bringing mobility.

If I attempt decipher that very politically correct answer, I would guess that means they aren't working together at all on what markets they are rolling out.- Sprint is going one way, as planned, while Clearwire is on its own path.

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CTIA: HTC's new devices

Posted by Tricia Duryee at 2:26 PM

ORLANDO, Fla. -- HTC, the Taiwan mobile device manufacturer with its North American headquarters in Bellevue, released two new mobile devices today that are not your typical phone.

The gadgets that the world's largest provider of Microsoft Windows Mobile devices unveiled look like miniature laptops and are part of a whole new category "ultra mobile devices."


The new HTC Shift.

The first one -- the HTC Shift -- uses Windows Vista with cellular 3G connectivity at half the weight of typical laptops; it is about the size of two DVD cases.
Some of the specs include: a 7-inch widescreen touch display, a
30-gigabyte hard drive, Tri-Band UMTS/HSDPA, Quad-Band GSM/GPRS/EDGE, Bluetooth 2.0 and Wi-Fi.

The second one -- the HTC Advantage -- uses the scaled down Windows Mobile 6 operating system. The HTC Advantage includes a thin,
magnetically connected Qwerty keyboard and advanced connectivity with
Tri-Band UMTS/HSDPA, Quad-Band GSM/GPRS/EDGE, Bluetooth 2.0 and Wi-Fi.

The HTC Advantage will be available through and other
retailers this summer. The HTC Shift will be available in the U.S. and
Europe in the third quarter. Specifications, pricing and availability will be announced when available.

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Netflix CEO joins Microsoft board

Posted by Benjamin J. Romano at 2:02 PM

Microsoft today announced the appointment of Reed Hastings, founder, chairman and CEO of video rental service Netflix, to its board of directors. The board has had nine members since Ann McLaughlin Korologos stepped down in November.

In the same announcement, Microsoft declared a quarterly dividend of 10 cents per share, payable on June 14 to shareholders of record on May 17.

"Reed's track record for delivering innovative and disruptive technologies to market is very impressive," Microsoft Chairman Bill Gates said in a statement. "With his rich consumer and technology background, he will be a tremendous addition to our board."

Hastings, 46, founded Netflix in 1997, the same year his previous venture, Pure Software, was acquired by Rational Software. Netflix finished 2006 with 6.3 million subscribers.

More on Hastings, who will serve on the board's finance committee, from Microsoft's press release:

An active community leader, Hastings has also been deeply involved in promoting education initiatives, and has served as president of the California State Board of Education.

He holds a bachelor's degree in mathematics from Bowdoin College and a master's degree in computer science from Stanford University. Hastings also served in the United States Peace Corps.

Here's his Netflix bio, which adds this personal tidbit: "Reed served in the U.S. Peace Corps as a high school math teacher in Swaziland."

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CTIA: Sprint kicks off with Kicks

Posted by Tricia Duryee at 11:19 AM


The French Kicks play at Sprint's news conference.

ORLANDO, Fla. -- Sprint Nextel and Samsung are announcing a new music phone today during a press conference with live thumping music heard from across the Peabody Hotel from French Kicks.

The reason for Sprint's press conference was to unveil the phone "UpStage," which Sprint and Samsung are calling the first U.S. wireless phone designed with a revolutionary form factor that optimizes music capabilities with the look of a phone on one side and an MP3 player on the other.


The Upstage from Samsung.

That means on one side it looks like an iPod with a big screen and a navigation pad similar to iPod scroll wheel. On the other side, you get the look and feel of a regular phone.

Sprint thinks it has solved the three critical things have prevented music phone adoption:

1. Improved battery life . With a battery wallet, which is sort of a calm shell that goes around the phone, users are supposed to get 6.3 hours of talk time and 16 hours of music.

2. You can use normal music earphones. The jack for industry standard headsets don't fit into mobile phones because the devices are thinner than the connector. Included in the box is an adapter, which has a microphone built in so your traditional headsets can be used to talk on the phone.

3. People have ripped tons of music to their PC. How do you get the music on the phone? Typically, that taken place by plugging the phone into the computer with a cord, and "sideloading" it. Sprint wants to solve this by offering songs for download over the air at 99 cents a piece -- the standard online. Until now, over- the-air songs from mobile carriers have cost $2.99.

"We feel we are going to upstage our competition," said a Sprint executive.

And, finally, Sprint said because $400 phones usually reach less than 1 percent of the population, the phone will be priced at $150 with a two-year contract. It will be available starting the first week of April.

A note on another subject: Just to let you know, I'm shooting photos you see on the blog with a Red BlackBerry Pearl that has a 1.3 megapixel camera.

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CTIA: Pocket full of phones

Posted by Tricia Duryee at 10:37 AM

ORLANDO, Fla. -- I always take a minute at CTIA shows to catch up with the fine folks at Symbian, the London-based company that this morning released a new version of its mobile phone operating system.

Nokia, part owner of the company, uses the operating system liberally. So, during my meeting with David Wood, Symbian's executive vice president of research, and Jerry Panagrossi, vice president, U.S. operations, I previewed preview the new line of Nokia phones.


The versatile Nokia E90.

The Nokia E90 is a work horse. The best way to describe it is as a horizontal clam shell. When closed, it looks like a large candy-bar phone, but when you flip it open, it is like a miniature laptop computer. It comes with "everything," Panagrossi said. That includes Wi-Fi, camera, GPS and HSDPA, the fastest speed network in the GSM family. No word on a commercial release date or how much it will cost.

The Nokia E65 was a little handheld slider where the keyboard slides out. It was red and had the texture of alligator skin (a fitting analogy I thought because I'm in Florida, not that I've felt alligator skin before).


The Nokia E95 slider.

Symbian CEO Nigel Clifford, whom I caught up with briefly in the hall, showed me two more phones, which I did not get pics of.

He showed me a very impressive MotoRizr Z8 (that's pronounced "rise-er"), which uses the Symbian operating system. The name is fitting because the slider comes out of the bottom and curves up to your face's countour. The flashy neon green highlights also catch your eye, as does the 2 megapixel camera. The phone also plays DVD-quality video at 30 frames a second.

I also caught a glimpse of the Nokia N95, which is a dual slider, meaning it has a keyboard at the bottom and a set of music player keys sliding from the top. It has a 5 (yes, 5!!) megapixel camera and super nice-looking screen.

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Vista sells 20 million licenses in February

Posted by Benjamin J. Romano at 10:13 AM

Microsoft released an update this morning on Windows Vista's performance during its first month on the market. Here's our story and Microsoft's press release.

"If you look just at the debut [of Vista], even accounting for overall organic growth in terms of the PC market, it shows really strong consumer response right out of the gate, which is good," Windows Client Director Kevin Kutz said in an interview ahead of the announcement. "And we're really encouraged by that."

How will financial analysts incorporate this new data point into their Vista forecasts, especially given that just over a month ago CEO Steve Ballmer tossed cold water on some sales predictions? In a conference call Feb. 16, he called some analysts Vista revenue forecasts for fiscal 2008 "overly aggressive." This will be interesting to watch in the run up to Microsoft's fiscal third quarter conference call on April 26.

Kutz provided some other interesting details:

-- The more expensive premium editions of Vista have been selling "extremely well."

-- Microsoft has no firm schedule for providing sales updates. "Typically in the past, we've done maybe one, maybe two, sort of an initial announcements talking about how sales are tracking and this is in keeping with that," Kutz said.

-- The company is not planning any immediate changes to its Vista marketing campaign. "We're pleased at the results so far and we're going to stay the course on all of that," he said.

-- More than 4,000 products and devices have been certified to work with Vista, up from 2,500 at launch.

-- More than 1.7 million device drivers are good to go for Vista, up from 1.5 million at launch.

Kutz had no comment when asked about schedules for a Vista service pack or for the next version of Windows.

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CTIA: Lots of people; lots of news

Posted by Tricia Duryee at 8:15 AM


A CTIA billboard in Orlando: Gives new meaning to the saying that even my grandma can use it.

ORLANDO, Fla. -- I wrote a story today on what to expect this week at CTIA Wireless 2007, which kicks off Tueday and ends Thursday.

The event is expecting more than 40,000 people to pack the 400,000-square-foot convention center in here, and judging by the taxi line at midnight Sunday night/Monday morning, that sounds about right.

A little local news is happening today:

-- Seattle's RealNetworks announced that it will be providing a music service for Rogers Wireless and Helio.

-- thePlatform, another Seattle company and a unit of Comcast, is announcing that it will be managing Helio's portfolio of mobile video content. Helio's video providers will use thePlatform's technology to upload, schedule and manage video provided to their subscribers.

-- Seattle-based M:Metrics, a mobile research firm, announced the launch of MeterDirect, a service that measures mobile behavior by installing phone monitoring software among people who elect to participate in the panel.

I will have more on that announcement in tomorrow's story, but Andy Brown, the CEO of KMR Group, an advertising giant had this to say about in M:Metric's meter vs. survey techniques:

Direct media measurement is critical to programmers, media planners and advertisers as they come to rely on the mobile channel as a component of their traditional and new media campaigns. While surveys are a reliable way to measure a wide audience, direct behavioral measurement offers the most precise method of understanding the details of consumer use of mobile content. Integrating the mobile channel into our broad scale campaigns has been a guessing game to date without the reach, frequency and duration data that we rely on in other media. MeterDirect gets us there."

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CTIA: Off to the races

Posted by Tricia Duryee at 7:57 AM

ORLANDO, Fla. -- It's the day before the CTIA Wireless 2007 show starts, but there's plenty going on.

There's a Smartphone Summit at the convention center, where companies are discussing devices and applications for enterprise customers. It was here that Symbian CEO Nigel Clifford announced the new version of the company's mobile operating system.

Most notably, Symbian said the Version 9.5 operating system will improve a phone's performance and reduce requirements on memory, processor and battery. The improvements are said to make Symbian OS v9.5 capable of running on the same hardware as feature phones, rather than requiring the equivalent of a handheld PC.

More details to come about this after I get briefed by the company at noon.

While the Smartphone Summit is focused on the enterprise, you can cross the street from the convention center and enter the Peabody Hotel to get the scoop on what's happening in mobile entertainment.

The mini-show there, called Billboard's Mobile Entertainment Live!, says it regularly draws more than 1,000 execs from the mobile, entertainment, technology and digital content industries.

While the Smartphone Summit talked operating systems, Billboard's event featured Greg Clayman, MTV senior vice president of mobile media.

Mozes, a Palo Alto, Calif., company that allows people to create interactive, text message-based mobile campaigns and promotions, announced a strategic relationship with Universal Motown Records at the even. By using Mozes, more than 60 Universal artists can communicate with fans instantaneously via mobile phone, including artists Akon, Blue October, Hinder, Godsmack and Mya.

For example, Hinder's Door to Dorm tour this spring will have a live contest during the concert where fans can text for a chance to win a backstage pass at the show. Everyone that interacts at the show gets a free mobile phone wallpaper and the ability to join Hinder's fan list on Mozes. Fans that opt-in to Hinder's list will be able to text with the band and receive exclusive mobile updates. Fans can also visit Hinder's mobile card at and download special offers from the band and communicate with other fans.

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March 22, 2007

Context on Microsoft search and ad group

Posted by Benjamin J. Romano at 5:45 PM

Adam Sohn, director of global sales and marketing with Microsoft's online services effort, provided more detail Thursday about the rationale behind uniting Microsoft's Live Search and adCenter platform in one group under new leadership.

Search was part of Senior Vice President Steven Sinofsky's Windows and Windows Live Engineering Group. The advertising platform, adCenter, resided under Blake Irving's leadership. Irving is retiring this summer. "

Sohn: "We basically took those two things out of there and put them together in a new organization [reporting directly to Platforms and Services Division President] Kevin Johnson. A signal, for sure, of our commitment to the importance of this business.

"Organizationally, I think it helps them function better as one of these cross-company, cross-property, cross-device technologies. When you look at the advertising platform, it's going to power advertising across all of these Microsoft properties and devices. Anywhere advertising is going to show up, it's going to be powered by adCenter. Search is the same way. So I think breaking them out, putting them [directly] under Satya Nadella and putting them under Kevin directly, gives him the ability to pay some more attention and put some more of his brain on it and also sort of sets them up to become kind of their own center of gravity in a way having them separated didn't seem to do."

More changes might be on their way in the coming months.

Sohn: "This is Kevin making moves and tuning the org. I think he's always looking. I think there's some more stuff that will come certainly as Blake nears his retirement at the end of the summer and possibly before."

In addition to adCenter, Blake Irving, corporate vice president of the Windows Live Platform group, oversees "datacenter and technical operations ... storage and payments infrastructure, backend communications and collaboration platform, business and customer intelligence, security and safety identity, VoIP, Mobile, global development and supportability capabilities and supporting application services built across the company, including Windows Live, Office Live, Xbox Live and other Microsoft applications," according to Microsoft's PR firm.

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Perkins Coie awards stem cell research grant

Posted by Kristi Heim at 5:04 PM

Seattle law firm Perkins Coie has given a University of Washington researcher a $20,000 grant for stem cell research.

The award, unusual coming from a law firm, is the first of its kind for Perkins Coie and part of a five-year commitment to support research at the UW Medical School's South Lake Union campus.

The annual $20,000 grants are designed as seed money to help incubate research that could form the basis for larger programs attracting funding from the National Institutes of Health and other agencies, said Jim Lisbakken, chair of the firm's Life Sciences Practice.

The UW originally approached Perkins Coie to fund building of its South Lake Union campus.

"Rather than funding buildings of bricks and mortar, we decided it would be much more personal and of greater interest to see our dollars at work on a particular project," Lisbakken said.

The UW medical school ranks first among all public medical schools and second among all U.S. medical schools in federal research funding. But some projects never get off the ground because they don't have enough "proof of concept" data at an early stage to apply for NIH funding.

UW researcher Morayma Reyes received the first Perkins Coie grant for work to isolate and identify stem cells to regenerate heart tissue.

Perkins Coie, which has 15 offices throughout the United States and in China, has represented biotech clients such as Immunex, ZymoGenetics and ICOS, and handled technology license agreements with the University of Washington.

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WSA Awards: Dave Ross rocks; James Sun shines

Posted by Kristi Heim at 9:39 AM

The WSA put on its annual awards show last night, and by the size of the crowd and buzz in the room, the tech industry is going strong and continuing to propel the state's economy.

It wasn't exactly the kind of Silicon Valley-boom-era celebration with vodka poured continuously from an ice luge, but still ... well dressed people toasted with lemon peel martinis, and acrobats in red velvet suits dangled from rings on stage.

Among the highlights, emcee Dave Ross sang a hilarious "I Got YouTube" to the tune of Sonny and Cher's "I Got You Babe."

"I took a bath with a cat and a million people downloaded that," he crooned.

Zoodango CEO James Sun brought some energy to the graying crowd, and he was offered a date with the daughter of one of the presenters, evidently a fan of his on-the-job-performance as a cast member of NBC's "The Apprentice."

YouTube's new owner, Google, joined the festivities for the first time as a sponsor, and new WSA President Ken Myer said the association will partner with the Technology Alliance and other groups advocating state educational intiatives.

The strangest moment of the night occurred toward the end, when an excited Bill Baxter exclaimed "Jesus Christ!" right before the community choice award was handed to Logos Bible Software.

Otherwise, the awards themselves lacked much spice, since the companies have been around for some time already.

Here is a list of the winners:

Double award winner for best use of technology in the government or non-profit sector and service provider of the year:
The PTSO of Washington offers shared, cost-effective technology services, specifically designed for community health centers, offering unprecedented support for electronic clinical and business functions.

Breakthough technology:
Inrix -- Inrix Smart Dust Network & Inrix Traffic Fusion Engine
Inrix uses Bayesian analysis to model traffic flows, improving the quality of real-time traffic data and predicting how traffic flow patterns will change.

Technology innovator:
Chris Diorio, chairman and CTO, Impinj
Diorio is also co-chair of the EPCglobal Hardware Action Group. Diorio received his Ph.D. from California Institute of Technology in 1997.

Business product:
Attenex -- Attenex Patterns E-Discovery Software
An integrated software suite designed to reduce the cost and risk associated with e-discovery for litigation, regulatory requests and internal investigations.

Consumer product:
Farecast -- is the first and only airfare prediction Web site. It's designed to help travelers decide whether to buy tickets now or wait.

Community choice:
Logos Bible Software -- Logos Bible Software 3 applies retrieval technologies to Bible study.

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March 21, 2007

A timely debate on Starbucks

Posted by Kristi Heim at 3:21 PM


You can find a Starbucks in the Forbidden City in Beijing, but having a store located there has provoked some controversy and protest.

Today's Starbucks shareholders meeting offered interesting fodder for debate, and more is on tap at a discussion next week on the role of chain retailers on Main Street.

Years ago, it would have been strange to think of McDonald's giving Starbucks some competition. But Starbucks' aggressive global expansion increasingly draws such comparisons, and now so does McDonald's coffee.

In addition, the company that prides itself on social responsibility is now getting some push back in places like China, where opposition has grown to its opening a cafe inside the 600-year-old Forbidden City.

Is Starbucks becoming too ubiquitous? Are three stores on the same street necessary?

Those questions are up for debate during the "Chains on Main" session during a national conference on "Building a Sustainable Future," which is hosted by the National Trust for Historic Preservation. The discussion takes place Tuesday morning from 9 to 10:15 at the Westin Seattle.

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The Digital Revolution vs. compact discs

Posted by Tricia Duryee at 1:46 PM

In light of my earlier post on how phones are increasingly capable of playing music and being used as a standalone music player, this article in the Wall Street Journal today is interesting.

It reported that compact-disc sales for the first three months of this year plunged 20 percent from a year earlier.

One reason, the Journal said, is that music stores are closing, including Tower Records. In fact, one statistic really stood out -- about 800 music stores, including Tower's 89 locations, closed in 2006 alone.

What's more, the downward spiral is moving faster than the rise of sales of digital downloads.

Digital sales of individual songs this year have risen 54 percent from a year earlier, to 173.4 million units, according to Nielsen SoundScan. But that's not offsetting the 20 percent decline from a year ago in CD sales to 81.5 million units. (To me, the figures look better for digital sales, but it must be falling short of filling the gap because songs are purchased individually, whereas CDs are music purchased in bundles.)

I was just talking to a mobile digital music executive about this same topic Tuesday. He argued that overall music sales -- including ringtones, wallpapers and other mobile or online goods -- do offset the decrease of CD sales.

The WSJ covered that aspect, too, and apparently that is not the case.

It reported that even when sales of ringtones, subscription services and other "ancillary" goods are included, sales are still down 9 percent.

The WSJ did note, however, that some recording executives have questioned that figure, provided by a recent report by Pali Research.

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Clearwire launches in Yakima

Posted by Tricia Duryee at 1:10 PM

Clearwire said today that it is launching wireless high-speed Internet access in Yakima March 27.

Yakima is Clearwire's seventh market in Washington state, with two more -- in Wenatchee and Kitsap County -- set to launch soon. The Seattle area, including Everett and Tacoma, is the largest market Clearwire is providing service in today.

A short event is scheduled to take place March 27 from 4 to 8 p.m. at the Yakima Convention Center. Featured speakers will include Yakima Mayor Dave Edler, Mike Morrisette, Greater Yakima Chamber of Commerce CEO, Heidi Anderson of Children's Wishes & Dreams, and Bill Dochnahl, Clearwire's general manager for Yakima.

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Survey says music phones are rising

Posted by Tricia Duryee at 12:07 PM

The number of phones capable of storing and playing music are on the rise, according to Seattle-based M:Metrics, a mobile research firm.

The United Kingdom boasts the highest penetration of these devices at 40 percent, followed by Germany (34 percent), Italy (32 percent), Spain (29 percent) and France (23 percent).

The rate in the U.S. is lower, with only 17 percent of phones, or about 33 million, capable of playing music. However, the U.S. numbers are growing quickly, with a 385 percent increase from 2006 to 2007.

Although ownership is rising, using the phone as a music player is a different matter. The percentage of users who sideloaded music -- by transferring files from a computer to a mobile device -- was only 2.9 percent in the U.S.

Still, M:Metrics expects the phone to become a common substitute for standalone music devices, such as an iPod. M:Metrics said 31 percent of those who use both a music phone and a music player in the U.S. selected their phone as their primary music device, while 11 percent use both equally.

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T-Mobile gets the Rizr

Posted by Tricia Duryee at 11:42 AM

T-Mobile USA said today that it will start selling the Moto Rizr Z3, the first slider phone in the U.S. from Motorola.


Moto Rizr Z3

The phone is high-tech and high fashion. It comes in a vibrant pearl blue with soft-touch finish, but also some quality features, like a 2.0 megapixel camera with 8x zoom.

The phone also has a built-in music player and stereo Bluetooth wireless capability. The phone has a microSD slot that can provide up to 2 gigabytes of additional memory (it comes with 128 megabytes), and it takes video and has USB connectivity to transfer files between it and a computer.

Check out the phone on the T-Mobile Web site, where it is selling for $99 after discounts.

The one surprising aspect of this phone is that it runs on T-Mobile's slowest network called GPRS. That would take a long time to send a photo taken with a 2 megapixel camera to a friend.

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Gates' gooooaaaaalllllll not enough for win

Posted by Benjamin J. Romano at 9:57 AM


Bill Gates plays a soccer game on an Xbox 360 with Mexican soccer star Rafael Marquez.

Bill Gates continued his Latin American trip with a visit to Mexico City on Tuesday. Celebrating the 20th anniversary of Microsoft's Mexico operation, Gates faced off with soccer star Rafael Marquez for a virtual soccer match on an Xbox 360.

According to this Associated Press report:

Gates met his technological match Tuesday, losing a video game simulation of a penalty shootout to ... Marquez 2-1 as hundreds of Microsoft Mexico employees and other invited guests cheered on the two.
"I wouldn't bet all of my money on it," the richest man in the world quipped when Marquez asked him if he really dared take on the challenge before they hunkered down in two opposing chairs and launched a live competition displayed on three giant screens hung above a large stage.

Gates also made headlines on the visit by commenting in favor of U.S. immigration reform.

"I'm a big believer that as much as possible ...f reedom of migration is a good thing," Gates said. "We're hopeful that we'll see some immigration reform...Hopefully it will be something that provides predictability and as much freedom as migration as possible."

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March 20, 2007

Inslee bill would push FCC on 'white space'

Posted by Benjamin J. Romano at 12:27 PM

U.S. Rep. Jay Inslee, a Democrat whose district includes Microsoft's Redmond headquarters, today introduced a bill pressing the Federal Communications Commission for a decision on whether gaps in the broadcast spectrum between television channels could be used for wireless Internet access, as a coalition of major technology companies would like.

His bill, which matches legislation introduced in the U.S. Senate in January, instructs the FCC to issue a final order on the matter by Oct. 7 or six months after the law is enacted.

Last week, the industry coalition -- comprised of Microsoft, Google, Dell, Hewlett-Packard, Philips and Intel -- submitted a demonstration device to the FCC meant to show that accessing the Internet through these gaps or "white spaces" will not impact television broadcasts on the adjacent channels.

The legislation calls for the opening of the "white space" -- found in the 54 MHz to 698 MHz frequencies (that's channels two to 51 for most of us) -- after the upcoming switch from analog to digital television on Feb. 18, 2009.

In a news release, Inslee expressed confidence that the use of this spectrum will be a boon for rural Internet access and will not negatively impact current uses.

"This spectrum has virtually unlimited potential," Inslee said. "It will open the floodgates to innovation and usher in a new wave of high-tech advances."

He noted that the Department of Defense has tested and approved technology for devices that share spectrum with military radar, and that his legislation would protect current users including broadcasters, public-safety personnel and people who use wireless microphones such as performers and journalists.

"Now that we have technology that can operate in white spaces without affecting current users, it's time to get rural and underserved Americans online," Inslee said.

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Feb. search share: Same story, different month

Posted by Benjamin J. Romano at 11:28 AM

Nielsen//NetRatings today released its February U.S. Internet search market share data (PDF) and Google continues to dominate, increasing its lead dramatically faster than its nearest competitors, Yahoo! and Microsoft.

Results show 55.8 percent of the estimated 3.6 billion U.S. searches were done with Google in February. That's up from 53.7 percent in January. Yahoo! claimed 20.7 percent last month, down from 22.7 in January. Microsoft had 9.6 percent, up from 8.9 percent.

The growth rates of the big three further illustrate the challenge Microsoft faces in catching its two major rivals. Google's share grew 40.3 percent year over year in February. Yahoo! grew 12 percent. Microsoft, 9.1 percent.

Compounding Microsoft's challenge in the short term is the leadership transition in its Live search business.

Last week, Mary Jo Foley posted a memo from Windows Division President Kevin Johnson saying that he and Steven Sinofsky, senior vice president of Windows and Windows Live engineering, would be naming a new leader for Microsoft's search R&D effort "within the next couple of weeks." That memo was dated March 9, so it's reasonable to expect some news this week or next.

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Space food gets Martha Stewart makeover

Posted by Kristi Heim at 10:05 AM

Charles Simonyi hasn't even lifted off for his adventure in space yet, but he's already reinventing the crew's menu. Thanks to Martha Stewart, the food is anything but down to earth. How about a little wine-roasted quail and duck breast confit with capers?

Those are just two of the gourmet items that the software engineer is taking to the International Space Station for a special meal hand-picked by his friend, Martha Stewart. He's set to launch April 7 onboard a Russian spacecraft from Kazakhstan.

I guess that means he'll have to give up the local cuisine of smoked horsemeat sausage and fermented mare's milk.

Simonyi wants to share the gourmet meal, prepared by French chef Alain Ducasse's kitchen, with his crew, astronauts and cosmonauts aboard the space station.

Apparently, the freeze dried "meat in white sauce" was no match for Martha's cooking.

Simonyi says: "Although the food is very good there, it is somewhat basic, and after a couple of weeks, everything starts tasting the same. I am certain a little variation will be surely welcome."

The six-course meal features quail, duck, shredded chicken parmentier, apple fondant pieces, rice pudding with candied fruit, and semolina cake with dried apricots.

As the fifth tourist in space, Simonyi just might be the most welcome visitor yet. No doubt the one with the best blog.

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March 19, 2007

Kathy Wilcox joins law firm

Posted by Tricia Duryee at 4:42 PM

After more than a decade at the WSA, Kathy Wilcox has joined Davis Wright Tremaine, working with the law firm's business transactions and corporate finance practice group.

"We are delighted to have Kathy join us. An industry and civic leader, Kathy brings to us a wealth of knowledge and expertise in the technology sector ... nationally as well as locally," said new practice group Chair Joseph Weinstein.

Wilcox stepped down from the technology trade association in July at age 61 after serving as president and chief executive for 12 years.

At the time, she said: "This is the best job I've ever had; it has been the most challenging job I've ever had. Now I want to leverage my skills in the broader community."

Today, she said in a press release that Davis Wright Tremaine "is perfectly poised in the Northwest, East Coast and China to serve emerging market and traditional business sector clients particularly well." She added that she is "excited to be a part of their growth."

Wilcox received her law degree cum laude from the University of Puget Sound, and her bachelor of arts in political science from the University of California at Los Angeles. She also received a management certificate from the University of Washington's Executive Business Program.

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InfoSpace replies to angry shareholder

Posted by Tricia Duryee at 4:03 PM

Executives at InfoSpace commented today on a shareholder's concern that the Bellevue company needed to cut costs and return capital in its large war chest to shareholders.

Last week, Sandell Asset Management asked InfoSpace to immediately return $300 million of cash, cut $15 million in costs and hire a financial adviser to evaluate the potential sale of the company in whole or in part. Then, it said it was going to nominate three directors at the 2007 annual shareholder meeting.

In a document filed with the SEC, Jim Voelker, chairman and CEO of InfoSpace, had this to say:

We are always interested in the views of our shareholders and appreciate those expressed by Sandell Asset Management in our conversations with them. We look forward to continuing our dialogue. Our board and management team are mindful of the mandate to deliver high performance and shareholder returns. We regularly review the company's business plan and the value inherent in that plan -- and will take a measured and decisive approach to continuing to do what we believe is in the best interests of all shareholders.

InfoSpace said it will also present recommendations regarding Sandell's nominees for directors in its proxy statement, which will be filed with the SEC and mailed to all shareholders.

InfoSpace has had difficult times after it was notified last year that its biggest mobile customer, Cingular Wireless, would be going directly to the music labels for content, rather than using InfoSpace's services. That caused InfoSpace to rethink its mobile strategy and lay off 250 employees to cut costs.

Today, InfoSpace is again more focused on its online portals, like Dogpile, and its mobile infrastructure business, such as search.

The stock fell 44 cents today, or 1.75 percent, to close at $24.70. Despite all the turmoil, that's only $3.69 below its high of $28.39 for the year.

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GotVoice combines all voicemail

Posted by Tricia Duryee at 12:47 PM

Kirkland-based GotVoice announced today that it has launched a free voice messaging service that allows consumers to manage their mobile, home and work voice messages online.

GotVoice says it is the only service that allows consumers to take visual control of their voicemail.

In 2005, GotVoice said it had determined the best way to use the software was to give it away and have an advertising-based revenue model.

When you sign up, be prepared to give your phone number and a PIN code for your voicemail.

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CTIA: Moto's Zander drops out

Posted by Tricia Duryee at 12:35 PM

Motorola's CEO Ed Zander will not deliver a keynote at this year's CTIA wireless conference in Orlando, starting next week, according to RCR Wireless.

RCR reported that he suddenly dropped off the conference schedule, which had him scheduled to open the show Tuesday with AT&T's COO Randall Stephenson and Microsoft Senior Vice President Pieter Knook.

Motorola or CTIA offered no explanation as to the change in plans. RCR surmised it was because Zander was busy fixing the company, which has been under the gun for less than stellar financial performances. The company is also a proxy fight by investor Carl Icahn.

I might have guessed something was up. On Tuesday last week, I asked for some time to speak with Zander, who has increasing ties to the Seattle area. It spends quite a deal of time with Microsoft, first developing the Motorola Q and now other devices. It also owns a significant stake in Kirkland-based Clearwire after it invested $300 million in the WiMax company and purchased its equipment subsidiary for $47 million last August.

I was told that I could not get time with him. Now it makes a little more sense.

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West Coast energy partnership: Where are Washington and Oregon?

Posted by Kristi Heim at 10:56 AM

Today's news that British Columbia Premier Gordon Campbell is going green and teaming up with California governator Arnold Schwarzenegger begs a question about the 600 miles in between them.

The so-called Hydrogen Highway hasn't merited much of a response from Oregon and Washington. Representatives of the two states apparently were not in the meetings where the partnership was drafted. The plan entails building a series of hydrogen fuel stations along the West Coast from British Columbia to San Diego, serving a population of about 60 million people.

One B.C. company that could reap the benefits is fuel-cell maker Ballard Power Systems.

Once considered little more than a pipe dream, hydrogen power along the left coast seems a bit closer to reality. Both British Columbia and California have now started funding the construction of fuel stations.

But some question whether all the hype is justified by real science. As an alternative fuel, hydrogen is not without problems. Hydrogen goes a long way toward reducing pollution that contributes to greenhouse gas, since the only byproducts of the clean-burning engines are water and heat. The problem is that a lot of energy is used in the making of hydrogen itself, a process that requires a significant amount of electricity, often through the burning of fossil fuels.

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Micron lab at UW to research new chip materials

Posted by Benjamin J. Romano at 10:18 AM

The University of Washington cut the ribbon today on a new research lab that will seek the best materials to surround ever-smaller silicon semiconductors in the computer chips of the future.

The Micron Laboratory for Combinatorial Materials Exploration is funded in part by $900,000 in materials and equipment from Micron Technology, the Boise, Idaho, maker of DRAM and Flash memory.

The silicon that conducts electrons across chips is getting thinner to fit more processing power into smaller devices. Fumio Ohuchi, a UW materials science and engineering professor and one of the new lab's directors, said silicon is still a good material for conducting the electrons.

"But the supporting material, the surrounding scaffold, will have to change as we're pushing the technical limit," he said in a news release. "Smaller devices will require new combinations of materials."

The lab will aim to rapidly research new combinations by layering wafers of different materials and then performing a single test to evaluate factors such as composition, atomic structure and manufacturing process.

The results will be published in a publicly accessible database. Ohuchi said the "combinatorial" process could be used to test materials for other high-tech applications, such as solar and fuel cells.

The lab is a boon for UW because it will "build much tighter relationships with our neighboring semiconductor companies," Materials Science and Engineering Department Chair Alex Jen said in the news release.

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Microsoft pushing phone system for small biz

Posted by Benjamin J. Romano at 9:08 AM

Microsoft is putting the full-court sales press on small businesses this week, online and in person, as part of its Small Business Summit. The company plans to tout the virtues of several products it says are designed specifically for small businesses.

Today, during a speech by Microsoft Chief Operating Officer Kevin Turner, the company is trotting out a new product aimed at small business phone systems. (Chairman Bill Gates is scheduled to make a video appearance announcing the product, for which he has been a patron of sorts.)

Response Point is a package of software and hardware designed to replace a PBX telephone system for businesses with 50 or fewer employees.

Jeff Smith, a senior product manager, said Microsoft built the system to be easy to set up, manage and grow to accommodate additional employees.

The system consists of a box that sits in a company's phone closet, and phones designed by three Microsoft hardware partners, Uniden, D-Link and Quanta Computer. Smith said the phones will have only one function button and will rely on speech recognition to execute commands such as speed dialing and transferring calls.

Smith said there's a large untapped market for small-business phone systems. Only one third of small businesses have a phone system; most use consumer phones and transfer calls by handing the receiver from one employee to another.

Beta testers, including several Seattle-area small businesses, have been using Response Point for the last eight months, but work on the project and the speech-recognition technology behind it goes back several years.

Smith said Response Point will be released this calendar year. He did not disclose a price.

At least as interesting as the new product is the way in which it was developed.

Smith said his team tried to operate as a small business within Microsoft, under the Microsoft Research organization, which has devoted lots of ongoing effort to speech recognition. The team keeps its own cost center and received "funding rounds" with approval of the project and the funding from Gates himself, Smith said.

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March 16, 2007

Shareholder lashes into InfoSpace

Posted by Tricia Duryee at 9:47 AM

Earlier this week (second item), one of InfoSpace's shareholders sent a letter to the Bellevue company expressing concern over cost controls and the lack of capital return to shareholders from InfoSpace's large cash balance.

And on Thursday, Sandell Asset Management notified InfoSpace that it will nominate three "highly qualified independent candidates" directors at the 2007 annual shareholder meeting.

In its first request, Sandell asked InfoSpace to immediately return $300 million of cash, cut $15 million in costs and hire a financial adviser to evaluate the potential sale of the company in whole or in part.

InfoSpace has had difficult times after it was notified last year by its biggest mobile customer, Cingular Wireless, that it would be going directly to the music labels for content, rather than using InfoSpace. That caused InfoSpace to rethink its mobile strategy, and lay off 250 employees to cut costs.

Today, InfoSpace is again more focused on its online portals, like Dogpile, and its mobile infrastructure business, such as search.

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More Ballmer on Google's headcount growth

Posted by Benjamin J. Romano at 9:47 AM

Microsoft today posted a transcript of CEO Steve Ballmer's talk to Stanford University yesterday, in which he took a poke at Google's headcount growth. We reported it here based on coverage of reporters in the room. Reading the full transcript this morning, Ballmer's comments come off a bit more watered down.

The question Ballmer was responding to is a bit garbled on the transcript, but basically asks him to compare Google's growth to Microsoft's.

Ballmer: Yes, we went from 24 to 75,000 people over 27 years, and if you did a compound growth rate and headcount, you'd get a relatively low number, it's just a lot of years and it's very consistent.

I think with the particular competitor you mentioned, they're trying to double in a year. I think that's insane, in my opinion. It doesn't mean they won't do it well.

But we've been digesting a certain percent growth over many years, and what that's allowed us to do is to build up a base of capable people who can take on more capable people.

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'Halo 3' to come in three flavors

Posted by Benjamin J. Romano at 9:27 AM

The third installment in Microsoft's best-selling video game series, "Halo," will come in a high-end collector's edition priced at $130.

"Halo 3," the concluding chapter of the alien-fighting trilogy based on the Marvel graphic novels, is set to be released later this year. No specific date was given by Microsoft today, but the company did detail three editions it will sell.

Standard Edition, which is just the game, will cost $60.

Limited Edition, $70, will include a bonus disk with a documentary on the making of the game. It will also have what Microsoft is calling "an audio-visual calibration tool ... to make the most of fans' high-definition home theaters".

The $130 Legendary Edition, which will come in limited quantities, comes in a Spartan helmet and includes a second bonus disk with more documentary materials. As an added treat, this edition will come with original "Halo 3" storyboard art.

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March 15, 2007

Ballmer whacks at Google growth plan

Posted by Benjamin J. Romano at 3:06 PM

Microsoft CEO Steve Ballmer was at his alma mater today, Stanford University, telling the multi-core, or in this case, multi-trick pony story about Microsoft. (That's the established cores or tricks in desktop and server, and the emerging areas of online and consumer.)

He also took a swipe at Google's plans to double its headcount in a year.

"That's insane in my opinion," he said, in this report from Dow Jones Newswires. "I don't think anyone has proven that a random collection of people doing their own thing has created value."

While Microsoft's headcount is nearing perhaps 75,000, the company hasn't seen employment double in recent history.

Here's a look at Microsoft's headcount and employment growth since 1996 (as of June 30 each year).

2006 71,553 17.3%
2005 61,000 6.9%
2004 57,086 4.8%
2003 54,468 7.6%
2002 50,621 5.4%
2001 48,030 22.6%
2000 39,170 24.1%
1999 31,575 16.7%
1998 27,055 21.7%
1997 22,232 8.1%
1996 20,561 N/A

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March 14, 2007

Microsoft acquiring Tellme, pushing voice interface

Posted by Benjamin J. Romano at 9:34 AM

After rumors circulated in CNET, The Wall Street Journal and other publications earlier this week, Microsoft this morning announced its plans to buy Tellme Networks, which combines voice interface with a broad range of Internet data.

Microsoft is talking big about the potential of Mountain View, Calif., based Tellme's technology and expertise.

"Speech is universal, simple and holds incredible promise as a key interface for computing," Microsoft CEO Steve Ballmer said in a press release announcing the acquisition. "Tellme brings to Microsoft the talent, technology and proven experience in speech that will enable us to deliver a new wave of products and revolutionize human-computer interaction."

The press release does not disclose a sales price, but The Journal and other publications quoted anonymous sources saying the acquisition was worth close to $800 million.

The companies are talking about the deal on a conference call now.

Microsoft says it could potentially incorporate Tellme technology into voice-enabled customer service functions in concert with its unified communications products; mobile search; and opportunities for third-party developers.

Privately held Tellme will become part of the Microsoft Business Division, headed by Jeff Raikes. The deal is expected to close in the second quarter. The company's 320 employees will continue working in Mountain View, according to the press release.

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March 13, 2007

Device to demonstrate feasibility of using new spectrum

Posted by Benjamin J. Romano at 2:03 PM

Microsoft and a handful of other technology heavyweights are pushing the Federal Communications Commission to open certain unused portions of the broadcast spectrum for Internet access. Today, the coalition was scheduled to give the FCC a device designed to demonstrate that using that spectrum -- usually unused TV channels called "white space" -- would not interfere with other broadcasts.

We reported on the effort in February. The Washington Post reports that the device was scheduled to be delivered to the feds today. We're waiting for more details from the FCC.

GigaOM cites sources saying that Microsoft engineers volunteered to develop the demonstration device -- interesting given that there are some hardware heavyweights in the coalition. The blog describes the device "as basically a dynamic radio that selects channels based upon perceived presence of other signals." Other members are Google, Dell, Hewlett-Packard, Philips and Intel.

The Post says the device will undergo "months of testing" at the FCC and could be in stores by 2009. That's interesting too. Back in February, a Microsoft spokesman said the device "is not a precursor to any specific Microsoft product."

Coalition members are couching their effort as a new competitor in the broadband market that could lower prices.

Bill Gates, speaking to a convention of Microsoft "Most Valuable Professionals" in Seattle this morning, described the effort to add more spectrum for wireless Internet connectivity by making use of broadcast spectrum white space.

"If we can get that to happen, the idea of having cities that have full Wi-Fi coverage becomes far more economic than it is today. So bringing down the price so that [broadband connectivity] can be essentially assumed by business and even assumed for students and people at home -- that's a clear thing that allows software to get in and do its great work," Gates said.

Google's telecom and media counsel in Washington, Rick Whitt, was more direct in his comments to The Washington Post: "It recognizes that the heart of the problem is a lack of competition on the broadband platform," he said. "We're very interested in finding ways to create platforms for other broadband connectivity."

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Clearwire's rough start

Posted by Tricia Duryee at 12:22 PM

Various publications are all writing about how Clearwire's stock is taking a beating. If you don't trust me, check out links here, here and here.

Red Herring even asks the question here "Did Clearwire hurt WiMax?"

I ask, how could a company that raised $600 million in its IPO -- despite the fact that it is unprofitable and unproven -- hurt an emerging industry?

Still, to be sure, early today the stock continued to slide, but but is now rising a bit to about $21.75 a share -- down $3.25 a share from its IPO price of $25.

Why is the company's stock getting hit hard for not being profitable when that was spelled out in black and white in the company's prospectus? Building a national and international network is not cheap. AT&T Wireless built a national wireless network for the $10.6 billion it raised from its IPO.

I think the Wall Street Journal had smarter coverage of what the IPO means in today's paper, mentioning both Clearwire and Seattle-based Isilon, which went public late last year.

The WSJ wrote:

Many investors appear willing to turn a blind eye to profits if a tech company displays soaring revenues. The recent IPOs of networking company Riverbed Technology Inc. and storage company Isilon Systems Inc. -- both unprofitable but boasting double- and triple-digit revenue growth -- were oversubscribed by investors. On its first day of trading in September, Riverbed's stock jumped more than 50%, while Isilon's soared 77% on its debut in December. Both stocks still trade well above their offering prices. "There's now a tremendous willingness to pay for growth," says Vadim Zlotnikov, chief investment officer at Sanford C. Bernstein. "We've had four years of unbelievable capital discipline. Now we've entered a bit more of a speculative environment again."

Clearwire is speculative, but if you are willing to take the risk, you could lose your shirt, or be highly rewarded. Right?

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March 12, 2007

Getty Images acquires Scoopt

Posted by Kristi Heim at 10:51 AM

The question of how Getty Images will respond to emerging competition from user-generated content was answered in part today with -- surprise! -- another acquisition.

Getty bought Scoopt, a 2-year-old Glasgow, Scotland, company that specializes in citizen photojournalism. The purchase price was not disclosed. Scoopt allows anyone with a camera to capture images and sell them on its Web site.

In one of the more famous examples, a bystander shot a picture of the Manhattan plane crash that killed New York Yankees pitcher Cory Lidle last October. The photos, e-mailed to Scoopt, eventually made their way onto the front page of The Times of London.

Getty said it will invest in technology upgrades and release news, sports and entertainment images from Scoopt that meets its editorial standards. I just tried looking up the most popular images on Scoopt's site today, and it's mighty slow.

Also interesting that Getty noted the need to "apply rigorous standards" to "validate the authenticity" of some of the works, many of which are coming from non-professionals wielding camera phones.

The voluntary code of ethics says: "Scoopt will always endeavour to protect you, but we can only do this if you tell us the whole truth about everything you submit."

Photographers who submit imagery to Scoopt retain copyright, but grant the company a 12-month exclusive license. Photographers get 40 percent of the royalties.

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Mobile operating systems

Posted by Tricia Duryee at 10:16 AM

In the PC world, there's pretty much one operating system that dominates the scene: Microsoft Windows. Sure, there's also Apple and Linux, too, but there's an advantage to having one dominate operating system -- it draws programmers to develop applications for it.

In the cellphone world, that's not the case. About a year ago, I wrote a story about how mobile phone carriers are starting to pick and choose which operating systems they want to support, narrowing the field from dozens to three or four.

For them, it is about cutting costs and efficiencies. It takes time to get all of their specialized programs -- like mobile TV -- on each and every phone. So logically fewer is better.

The New York Times wrote a similar story today.

Doesn't look like much has changed, but the NYT said that Vodafone, the world's largest mobile phone company, has declared will eventually sell only phones that ran on Microsoft's Windows Mobile, Symbian Series 60 or Linux systems. And that NTT DoCoMo of Japan has concentrated on Symbian and Linux.

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March 9, 2007

Gates Foundation hires former Mexico health secretary

Posted by Kristi Heim at 12:09 PM

The Bill & Melinda Gates Foundation has hired Julio Frenk, the former health secretary of Mexico, as a senior fellow in its global health program. It's an interesting choice for a few reasons.

Frenk is a physician who directed health policy for six years in the administration of President Vicente Fox.

During that time, the foundation notes, Mexico's maternal mortality rate fell more than 20 percent, and the country was one of only seven to make sufficient progress toward achieving the Millennium Development Goal of reducing child mortality by two-thirds by 2015.

Frenk came under fire from some conservatives for his decision to provide free "morning after" birth control pills in government hospitals and clinics. He also introduced a broad health insurance system for the country.

His experience at the World Health Organization could prove valuable for the foundation. At WHO, he was executive director of evidence and information policy, and later a candidate for director general. There Frenk worked closely with Christopher Murray, a Harvard professor whom the foundation and the UW are trying to recruit to head a new Health Metrics Institute at the university.

The institute, which would be launched with a $100 million grant from the Gates Foundation, would specialize in measuring and evaluating the health of people in the world's poorest countries. At the foundation, Frenk's new job description includes strengthening the monitoring and evaluation of health programs. Maybe he's already given Murray a call.

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March 8, 2007

Music industry targets individuals in new round of lawsuits

Posted by Kristi Heim at 11:13 AM

Two people in Washington state have been sued by the Recording Industry Association of America for illegally downloading copyrighted music over the Internet.

The copyright infringement suits were filed in Seattle and Tacoma after the RIAA obtained the names of the individuals from their Internet service providers. The suit names a woman from Tenino and a man from Redmond, among more than two dozen lawsuits filed around the country, including three in Oregon.

The RIAA said the music was distributed using P2P services such as LimeWire. Record companies filed a lawsuit against the operators of LimeWire last fall, but the service continues to be available, calling itself "the fastest P2P file sharing program on the planet."

LimeWire's Web site notes the difference between legal and illegal file sharing using its service:

"LimeWire is legal software, but it is illegal for you to use LimeWire to share copyrighted files without permission."

In late 2005, Seattle-based Shared Media Licensing signed a deal with LimeWire and London's Magnatune record label to distribute works by Magnatune artists.

Here's a story looking at different views on P2P file sharing.

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Clearwire's out of the gate

Posted by Tricia Duryee at 10:14 AM

The Kirkland company that just raised $600 million in its initial public offering last night is trading steady in its first day on the market.

Clearwire is using an emerging technology called WiMax to build a wireless broadband network across the country.

It sold 24 million shares last night for $25 a piece to make $600 million -- better than its highest expectations. In addition, the company has granted the underwriters the option to purchase up to an additional 3.6 million shares of Class A stock at $25 to cover over-allotments, if any.

In early trading today, the company's stock -- with the ticker CLWR -- jumped to around $28 a share before falling back to $25.

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March 7, 2007

Clearwire's public offering at $600 million

Posted by Tricia Duryee at 7:07 PM

Kirkland-based Clearwire raised $600 million today in a highly anticipated public offering, making it the second largest IPO in Washington state's history.

Clearwire exceeded all of its expectations: it sold 24 million shares for $25 apiece, reaching the high end of the expected range of $23 to $25.

The company expected to sell as many as 23 million shares, including an overallotment.

Beginning Thursday, the company's stock will start trading on the Nasdaq under the ticker symbol CLWR.

Check out my Web story -- to be posted soon -- here, as well as another story tomorrow.

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Clearwire is set to go public

Posted by Tricia Duryee at 2:06 PM

Now that the public markets have closed for the day (and we aren't talk about Pike Place), Clearwire is expected to be priced any minute in its initial public offering.

If it's any indication that it could occur soon, Clearwire filed four documents with the Securities & Exchange Commission today.

Two of those documents are just updates to Clearwire's initial IPO intentions.

There's not much different in the document today compared with the one filed Feb. 20.

What did stand out were details on where the Kirkland-based company is planning to roll out its WiMax-like services next. It wrote that it plans to make the service available to about 16 million to 18 million people in 2007 in the U.S. and abroad. The number reaches to more than 45 million people in 2008.

In the rest of 2007 and for all of 2008, Clearwire said it plans to launch in "certain small cities in Central or Eastern Washington, small and medium cities in Central and North Florida and South Alabama, various contiguous small cities in adjacent suburban and rural areas in Southeastern Pennsylvania and medium metropolitan areas in Central California, and medium to large metropolitan areas in Texas and in the Southeast."

It also expects to expand its market in Belgium, and launch in Spain.

This line in the filing is also new: "We believe this deployment schedule diversifies our geographic concentration, makes efficient use of our existing spectrum portfolio and carries potential to broaden our subscriber base to as many as 375,000 to 400,000 total subscribers in both our U.S. and international markets by the end of 2007."

At the end of 2006, Clearwire offered service to the 8.6 million people in its 34 U.S. markets and 1 million people abroad, in Brussels, Belgium and Dublin, Ireland. Clearwire had 184,400 U.S. subscribers and 21,800 international subscribers at year's end.

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Getty Images' bid for Jupitermedia hits skids

Posted by Kristi Heim at 12:33 PM

Jupitermedia said today talks with prospective buyer Getty Images have stopped, sending its stock falling toward Pluto.

Connecticut-based Jupitermedia shares are down around 17 percent to $7.19.

Last week, Getty outlined a strategy around building entertainment content following its acquisition of WireImage. Jupitermedia is a little different, in that it is mostly a low-cost stock image bank that occassionally competes with Getty. Analysts thought a buyout would have strengthened Getty's position.

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Nokia and mobile advertising

Posted by Tricia Duryee at 11:49 AM

Nokia said this week that it is launching two mobile advertising services called the Nokia Ad Service and the Nokia Advertising Connector.

The Nokia Ad Service is aimed at advertisers wanting to place targeted ads on mobile services and applications. The service consists of mobile publishers and a platform to help them deploy and manage mobile ad campaigns.

The Nokia Advertising Connector is for third-party publishers and advertising aggregators. It helps optimize the ads for the environment -- switching between text, visual, audio and video ads depending on the user's context and feeding the ad to the device.

"As advertisers struggle to reach personalized targeting with traditional media such as print and TV, mobile advertising is becoming an increasingly attractive channel for brands," said Tom Henriksson, director of Nokia Ad Service at Nokia Emerging Business Unit.

I talked with Nokia for my story on Monday about the promise of mobile advertising. I spoke with Tero Ojanperä, Nokia's chief technology officer, obviously before the company had made these announcements.

He said mobile advertising can take a number of forms, but for now it's somewhat limited.

"I think the more longer term potential here is to understand the different applications," he said. "If you were listening to music and were interested in the artist, there's a very discrete way for you to buy it."

I originally wanted to talk to Ojanperä because I had heard from a couple of sources that brands wanted to subsidize the cost of the phone to the consumer. I wanted to know how that would play out. Would the phone be red and sponsored by Coca-Cola? Or would the brand be able to dictate what was on the phone?

I figured Nokia would be very much interested in this concept because it would mean getting more expensive and more sophisticated phones into consumers' hands.

But phone subsidies don't seem to be in the works. "I haven't seen any player subsidize the phone," he said.

I suppose that could always change, though.

"This is very much an experimentation, it's not big yet, but it's being discussed more and more," he said.

After that conversation, I think I tracked down the original source of speculation that phones would be ad-subsidized. During an interview with Reuters, Google CEO Eric Schmidt said: "Your mobile phone should be free. It just makes sense that subsidies should increase" as advertising rises on mobile phones.

Well, Schmidt, I hope you are ready to write a check. I did a pretty thorough check and no one else seemed to be interested in coughing up dough. Feel free to correct me if I'm wrong.

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Posted by Monica Soto at 11:43 AM today launched "Amazon Unbox on TiVo," a service that offers thousands of downloadable TV shows and movies to the some 1.5 million TiVo subscribers with high-speed Internet connections.

As an incentive, Amazon and TiVo will offer $15 in free movie and TV show downloads to those who sign up for the service by April 30. (We first wrote about the service in February.)

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Entellium new hire

Posted by Tricia Duryee at 11:01 AM

Entellium, which develops Web-based customer relationship software, said today that it has hired David Scott as senior vice president of sales and marketing.

Scott, a former senior executive at both Intermec Technologies and PeopleSoft, will be responsible for developing and managing Entellium's product marketing, corporate communications and sales growth strategies.

"I'm drawn to Entellium because it focuses on product innovation, hands-on research and one-on-one customer service," he said. "I look forward to contributing my experiences, business knowledge and vision at this exciting time for the company."

Scott's career included stints at General Electric and The Boston Consulting Group. At PeopleSoft, he was vice president of marketing and strategy and supported the company's $2.5 billion global services division. At Intermec, a leader in RFID technology, he led a 125-member team in building the company's global marketing organization.

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Impinj raises $19 million in VC

Posted by Tricia Duryee at 10:52 AM

Impinj, which develops semiconductors based on RFID technology, said today that it has raised $19 million in venture capital.

AllianceBernstein, one of the world's largest asset management firms, led the round, with all previous investors also participating. They include Arch Venture Partners, GF Private Equity Group, Madrona Venture Group, Mobius Venture Capital, Polaris Venture Partners and strategic investors Unilever Technology Ventures, UPS Strategic Enterprise Fund, VentureTech Alliance and the Viterbi Group.

In total, Impinj has raised $98 million. The money will be used to escalate product development and delivery of its RFID readers, tags and antennas.

Impinj is one of the companies in town that has been named a likely candidate for an initial public offering.

Here's a story by Kristi Heim from last summer on how Impinj has had some early successes, but now other companies are starting to catch up.

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Inrix a possible acquisition target?

Posted by Tricia Duryee at 10:41 AM

The biggest competitor to Kirkland-based Inrix, which uses road censors and car locators to predict traffic patterns, was officially acquired today by Navteq, a provider of digital maps.

Navteq said it paid $177 million for, which also provides traffic information. The acquisition is pending approval by stockholders of

Previously, Inrix commissioned a study by Frost & Sullivan to determine whether or Inrix provided more accurate traffic data.

Inrix said the study concluded that Inrix was the leading provider of real-time traffic information in the U.S.

If that's the case, it makes me wonder whether that make Inrix as a likely acquisition target.

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Briefs: iConclude, HTC and Microsoft

Posted by Tricia Duryee at 10:17 AM

Sometimes things get a little hectic around here, and things that would normally be stories, end up being briefs. Tuesday -- for today's newspaper -- was one of those days. So, I'd like to point three things in today's paper. They can all be found here (If you were to look for it yourself, it's a link that's nearly halfway down the business section page, indicated by the tag "Business Digest."

1. Brier Dudley and I blogged about this yesterday, but Opsware, a company co-founded by a founder of Netscape, purchased iConclude for about $60 million in cash and stock.

2. Microsoft's Jeff Raikes is set to announce today that the company is releasing a new version of its Office Communications Server at VoiceCon Spring 2007.

The new version of is pretty interesting, and expands the 2005 release significantly. I talked with Eric Swift, Microsoft's senior director of product management in the Unified Communications Group, about it Tuesday, and he said the big feature will enable users to be able to click to call, instant message or start a Web conference from within Microsoft Office documents or Outlook.

Because of these enhanced abilities, Microsoft forecasts that within three years, the cost of rolling out VoIP will be cut in half because of software implementations. And, by then, it expects 100 million people, or twice the number of current business VoIP users, to initiate calls from Microsoft applications.

The public beta of Office Communications Server 2007 will start at the end of March, and general availability is expected by this summer.

3. Yahoo! announced today that its mobile application called Yahoo! Go for Mobile 2.0 will now be available on Windows Mobile devices.

Yahoo! Go for Mobile includes oneSearch, which allows users to surf the Internet and also access maps, news, photo sharing and Yahoo! e-mail.

In addition, Yahoo! said it has formed a strategic partnership to pre-load and distribute Yahoo! mobile applications on millions of HTC devices. HTC, a Taiwan company with U.S. headquarters in Bellevue, is one of the largest distributors of Windows Mobile devices.

I think this is yet more evidence of how Microsoft is willing to work with other companies on its mobile initiatives. Steve Ballmer even said so at 3GSM two years ago; Microsoft is in mobile to partner, not dominate, he said. He doesn't want anyone -- a carirer or handset manufacturer -- to feel that they have to buy Microsoft's entire package.

If HTC, which is super reliant upon Microsoft, feels this way, it has to be true.

The other recent example was when Palm launched the new 750w. Instead of integrating MSN as the main search engine, it chose to go with Google, a decision that was fully supported by Microsoft, Palm said.

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March 6, 2007

iConclude's $60 million conclusion

Posted by Tricia Duryee at 10:35 AM

Bellevue-based iConclude, which builds software that runs many of the tasks found in data centers, signed a definitive agreement today to be acquired by Opsware of Sunnyvale, Calif.

The transaction is valued about $60 million. That breaks down into about $30 million in cash and 3.39 million shares of Opsware common stock ($22.6 million, based on the recent trading price of $6.66 a share), and $7 million from iConclude's existing cash, which will be distributed to stockholders as a dividend at closing.

The acquisition is subject to customary closing conditions. Opsware said it intends to retain almost all of iConclude's employees.

With the addition of iConclude, Opsware said it will provide one of the only IT automation solutions that integrates a number of tasks, including "change management," compliance and process automation for servers, networks and storage.

In December 2004, Opsware purchased Redmond-based Rendition Networks in a $33 million deal. Rendition Networks software helped companies comply with Sarbanes-Oxley regulations by monitoring networks and recording data for auditing purposes. It also tracked changes to the network to identify all the devices connected to it, including routers, switches and firewalls.

Opsware, a public company based in Sunnyvale, Calif., was co-founded by Chairman Marc Andreessen, a founder of Netscape Communications.

iConclude most recently raised $9 million in venture capital. Its investors included: Madrona Venture Group, Greylock Partners and Shasta Ventures. In all, the company raised about $12 million.

Late last year, iConclude formed a partnership with Opsware, allowing Opsware to resell and market iConclude's platform through its worldwide field sales and channel team.

Update: Brier Dudley talks with iConclude CEO Sunny Gupta, who says the deal was too good to pass up.

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March 5, 2007

Clearwire's impending IPO

Posted by Tricia Duryee at 5:09 PM

There's a ton of speculation about Clearwire's IPO, which should be right around the corner -- maybe tomorrow or Wednesday.

Business Week speculated today that the Kirkland wireless broadband company's IPO "could be one of the most talked about -- and sought-after -- tech initial public offerings of the year." And the company, which is offering up to 23 million shares at $23 to $25 each could actually go for more.

Business Week quoted Scott Sweet, a managing partner at consultancy, who said the shares are likely to debut at $25 to $27, fetching Clearwire as much as $621 million, compared with the $513 million the company initially expected. reported today that the IPO market is "about to heat up with the launch of the Clearwire initial public offering," calling it "the current pet project of one of the biggest names in American entrepreneurialism: Craig McCaw."

The most interesting tidbit came from Business Week, which questioned what would be next for the money-hungry company that would need millions upon billions in its life to roll out a national and potentially international WiMax network.

The story said Clearwire could become an attractive acquisition target for Sprint, which has already dedicated billions to rolling out its own WiMax network.

Business Week said Sprint "could benefit from the addition of Clearwire's spectrum and its expertise in fixed WiMax. Sprint already plans to work with Clearwire to ensure the companies' respective networks don't interfere with one another. And because they own spectrum in different markets, Sprint doesn't expect to see much services overlap, says Don Stroberg, vice-president for mobile broadband strategy at Sprint."

Stroberg declined to comment on the acquisition rumors.

But wait, one step at a time, folks!

Clearwire may be receiving a lot of hype and attention, but it still is only one of a few tech IPOs testing the waters this year. It's also following the biggest market decline since 9/11.

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Mobile marketing engine

Posted by Tricia Duryee at 12:16 PM

I wrote today about how ads may be coming to your cellphone.

It's a complicated subject because there are more players involved than with advertising on the Internet. Wireless carriers, in effect, own the relationship with the customer, so they have control over whether there will be ads or not. But because the opportunity seems to be so promising, carriers and emerging companies have started to experiment. The intrigue: Cellphones have the ability to target advertising to one person's phone, a very personal device.

Check out the story here and the sidebar on all the ways ads on phone could take form here.

It's in the sidebar where I mention a lot of local companies that are working on devising ways to put ads on phones. Those include: SNAPin, InfoSpace, Medio Systems and Microsoft. Inevitably, I always miss some.

Action Engine said today it will be speaking at a number of events about mobile advertising. The Bellevue company helps deliver mobile content to phones with ads inserted in the mobile Web pages.

"It takes time to develop complex mobile technology that incorporates smart functionality, such as the ability to use location and context-relevant information to deliver tailored advertising campaigns," said Scott Silk, Action Engine's CEO.

What other Puget Sound-area companies are working on something?

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March 2, 2007

T-Mobile USA wants to sell towers

Posted by Tricia Duryee at 1:17 PM

T-Mobile USA said it may be interested in selling anywhere from 3,500 to 5,000 of its cellphone towers -- a sale that could bring upwards of $1 billion, according to industry newsletter RCR Wireless.

The money could come in handy after the fourth largest carrier in the country spent about $4 billion on new spectrum to deploy high-speed 3G services.

"We've been saying all along that T-Mobile should consider selling its towers," said Mark DeRussy, an analyst at Raymond James & Associates. "Considering T-Mobile wrote a pretty big check for the last auction, this could help pay for that."

Often times, towers are owned by a third party that can then lease space to multiple carriers to save on expenses.

RCR said the carrier's German-based parent company, Deutsche Telekom, revealed this information during a conference call Thursday detailing financial results.

T-Mobile USA said it added 901,000 new customers in the fourth quarter for a total of more than 25 million customers.

The Bellevue company's net income for the quarter was $179 million, down from $1.79 billion in the third quarter and $3 billion in the fourth quarter 2005. The lower net income resulted primarily from non-cash income tax benefits in both of the previous quarters. T-Mobile USA's total revenue grew to $4.5 billion in the quarter from about $4 billion a year earlier.

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March 1, 2007

Big Fish eBay update

Posted by Tricia Duryee at 3:13 PM

Earlier this week, we said Big Fish Games was auctioning off a chance for someone's photo to appear in its next Mystery Case Files game.

The auction is occuring on eBay.

Here's the update: Two days since it launched, the auction has attracted more than 8,540 visitors with 27 bids, reaching $540 at last check.

The auction will close March 8 at 3 p.m. The proceeds go to charity.

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Will Apple's iPhone really dominate?

Posted by Tricia Duryee at 11:28 AM

Yesterday, Apple Chief Operating Officer Timothy Cook said at a conference in Las Vegas said Apple expects 10 million customers to pay at least $499 to buy an iPhone next year.

A Bloomberg story today said the iPhone will start shipping in June in the U.S. Chief Executive Steve Jobs said in January that Apple expects the iPhone to capture 1 percent of the roughly 1 billion worldwide mobile-phone sales.

Let's look at the claims Apple and AT&T were making yesterday.

Up to 75 percent of U.S. iPhone buyers probably will be first-time subscribers to AT&T's mobile-phone service, said AT&T Chief Financial Officer Rick Lindner. The phones will only work on AT&T's wireless network, formerly known as Cingular Wireless.

This is a back-of-the-napkin analysis because we don't have all the projections, but let's say the iPhone is launched in other countries by next year, and half of the projected sales come from outside the country.

That leaves AT&T, the former Cingular, responsible for selling 5 million iPhones -- a very conservative estimate.

Last year Cingular Wireless added 6.8 million new subscribers to its network. If that's the case, then what Lindner said has to be true: 75 percent of its new subscribers, or 5.1 million, would have to buy the iPhone to reach those kinds of targeted numbers.

To be clear, that's 5.1 million people opting to purchase a phone for $499 or $599 over free, the common price of a phone for a new subscriber, or a couple hundred dollars, which is frequently the price of a new BlackBerry or Windows Mobile device that for the most part have the same capabilities or more.

I ask you, what are the chances of that happening?

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MYSBUX to find local stores

Posted by Tricia Duryee at 10:26 AM

My colleague Melissa Allison wrote today about how Starbucks is launching its own short-code messaging system that allows customers to find nearby stores by texting a zip code to MYSBUX.

This is fairly innovative for Starbucks, given that this is the first company I have heard of that offers this service. However, other companies, such as Google, offer an endless number of listings by text message, so I wonder how popular it will be?

As an example, yesterday I text messaged (or is it texted?) "Starbucks 98144" to Google at 466453. And, within a few seconds, I received two text messages back listing two different locations in that Zip code, one on Martin Luther King and the other on Rainier Avenue. The text message included the address and phone number of each store.

I was surprised at how well it worked, but then at the same time, there were only two Starbucks in that Zip code. Imagine if you picked the Zip code for downtown Seattle?

On the Starbucks Web site, I searched in the 98101 zip code, and got 19 responses. I hope you have an unlimited text message plan!

For comparison purposes, I conducted the same test today, this time text messaging (or texting, if you will) 98144 to MYSBUX, or 697289.

The results: After submitting the request at about 10:50 a.m., I'm still waiting. Perhaps you are better off using the other service Starbucks launched, which allows you to easily go to on your mobile browser, and enter a city or Zip code of your choice. To get results, it takes as long as your phone takes to load a Web page. For the 98144 area code, I was offered a list of seven choices.

By conducting the search this way, you will incur a data connection charge (unless you pay for unlimited data), but you'll skip the text messaging fees, which can amount to up to 15 cents a message without a plan. (Yikes, $2.85 in the downtown Seattle example!).

This also reminds me of the Starbucks text messaging campaign it did last summer. It sent you questions by text message that you answered. In the end, I was awarded with a $5 Starbucks gift card.

What's next?

UPDATE: I never heard back from Starbucks after texting it at 10:50 this morning. So I just tried it again and ended up hearing back immediately. This time I got three responses, even though Google sent me only two yesterday. In addition, if you click on the link in the text message, it takes you to a page with a map. Not too shabby.

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Tricia Duryee
Tricia Duryee

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Angel Gonzalez

Kristi Heim
Kristi Heim

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Benjamin J. Romano

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