Sunday, February 6, 2011 1

Nasdaq hackers target service for corporate boards

BUYING GUIDE.

Hackers broke into a Nasdaq service that handles confidential communications for some 300 corporations, the company said Saturday — the latest vulnerability exposed in the computer systems Wall Street depends on.

The intrusions did not affect Nasdaq's stock trading systems and no customer data was compromised, Nasdaq OMX Group Inc. said. Nasdaq is the largest electronic securities trading market in the U.S., with more than 2,800 listed companies.

A federal official told The Associated Press that the hackers broke into the service repeatedly over more than a year. Investigators are trying to identify the hackers, the official said. The motive is unknown. The official spoke on condition of anonymity because the inquiry by the FBI and Secret Service is continuing.

The targeted service, Directors Desk, helps companies share documents with directors between scheduled board meetings. It also allows online discussions and Web conferencing within a board. Since board directors have access to information at the highest level of a company, penetrating the service could be of great value for insider trading.

Nasdaq OMX spokesman Frank DeMaria said the Justice Department had requested that the company keep silent about the intrusion until at least Feb. 14. However, The Wall Street Journal reported the investigation on its website late Friday, prompting Nasdaq to issue a statement and notify its customers.

DeMaria said Nasdaq OMX detected "suspicious files" during a regular security scan on U.S. servers unrelated to its trading systems and determined that Directors Desk was potentially affected. It pulled in forensic firms and federal law enforcement for an investigation. They found no evidence that customer information was accessed by hackers.

Rich Mogull, an analyst and CEO with the security research firm Securosis, said Web-accessible services like Directors Desk are a prime target for hackers, and have sometimes been a back door for systems that aren't directly connected to the Web. The presence of files on the Directors Desk system and the claim that no customer information was compromised could indicate that hackers were able to get in but not complete their attack, he said.

Computer security experts have long warned that many companies aren't doing enough to protect sensitive data, and recent events have underlined the point. The secret-spilling organization WikiLeaks has published confidential documents from banks in Switzerland and Iceland and claims to have incriminating documents from a major U.S. bank, possibly Bank of America.

In 1999, hackers infiltrated the websites of Nasdaq and the American Stock Exchange leaving taunting messages, but Nasdaq officials said then that there was no evidence the break-ins affected financial data.

Nasdaq OMX CEO Bob Greifeld said in a statement that cyber attacks against corporations and government are constant and the company is vigilant in maintaining security.

"We continue to evaluate and enhance our advanced security controls to respond to the ever increasing global cyber threat and continue to devote extensive resources to further secure our systems," he said.

Some of the Wall Street's technological scares have been unrelated to hackers. In June 2009, a computer glitch knocked out trading in 242 stocks on the New York Stock Exchange for several hours.

More recently, high-speed trading software precipitated a "flash crash" on May 6. One trade worth $4.1 billion touched off a chain of events that ended with 30 stocks listed in the S&P 500 index falling at least 10 percent within five minutes. The drop briefly wiped out $1 trillion in market value as some stocks traded as low as a penny.

___

Associated Press Writer Pete Yost contributed from Washington.

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Google launches Android Market for the Web, shows off Honeycomb

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The just-launched Android Web store lets you find, purchase, and remotely install new Android apps onto your device, all straight from a browser. Also: Google demonstrates some of the new bells and whistles in Honeycomb, the upcoming tablet-centric version of Android.

You can check out the new, Web-based Android Market right here, although some users (including me) were having trouble logging in to the site Wednesday afternoon. (Word had it that the glitch would be fixed later in the day.) Update (3:15 p.m. ET): Looks like it's working now.

The online market looks a bit like a pared-down version of Apple's App Store on iTunes, complete with jumbo-sized promos and an abundance of users reviews.

A series of categories sits in the left-hand column of the page, while tabs to the right let you check out featured apps, as well as the most popular paid and free applications.

An info page for a given app contains the usual screenshots and user ratings, while users will also be able to recommend the app to friends, watch an embedded demo video (a feature sorely lacking in the Apple App Store), or tweet their latest app discoveries.

Click the "buy" button, and an info screen pops up with permissions and access warnings (telling you, for example, whether the app will be tapping into any personal or location data), and giving you a choice of stored credit cards.

Once that's all done, just hit '"install," and (here's the really clever part) the app will begin installing itself on your Android device, no syncing required. (A "My Devices" page in the Android Web store will let you name and manage your various Android apps, by the way.)

Google also announced that it's finally enabling support for in-app purchases, good for unlocking new "premium" features, buying extra ammo or weapons in a shooter game, and so on.

Google also took some time during Wednesday's briefing to demo Honeycomb, the upcoming, tablet-focused version of Android that'll be powering new dual-core tablets from Motorola and LG. Among the improvements: revamped home-screen navigation, including a snazzy multitasking view that lets you see thumbnails of running apps in their respective frozen states.

During CES, we already saw the trio of on-screen buttons in the lower-left corner of the display: one for home, one for back, and another for … something else. Well, that something else turns out to be multitasking, and Honeycomb take a clever approach to letting you switch between apps.

Rather than just swiping back and forth between a series of static icons, tapping the multitasking button calls up a column of medium-sized thumbnails showing your running apps frozen in the background; tap one, and it'll jump back to life. Nice.

Also new is a rejiggered notification bar, which sits in the bottom-right corner of the display. The new, expanded notifications will show both contact names and images for incoming texts and IMs, play and pause controls for music, and other features depending on the whim of a given developer. Tapping on the notifications bar will call up a pane showing all your notifications at once, which you can dismiss individually by clicking the "X" next to the item.

Not bad, but the most compelling new features for Honeycomb lie under the hood, with developers getting a custom toolkit allowing them to easily revamp their apps for use on both a smaller smartphone screen and a jumbo tablet display.

That's not to say existing Android apps won't already work on Honeycomb-powered tablets, with a Google exec showing off how Fruit Ninja, a causal game built before Honeycomb even existed, works "amazing" well on a tablet—and indeed, a live demo showed the exec slicing away at various animated fruits and vegetables on the Honeycomb-running Motorola Xoom, complete with a series of multi-finger swipes.

But developers will now be able to funnel the content and features of their apps into so-called application "fragments," which can be exposed, hidden, and rearranged depending on the device and screen size. A demo of Gmail, for example, showed the app running in a two-pane view, with the left-hand pane sliding off the screen to make room for the body of a message. Those various columns in Gmail are essentially chopped up into different app "fragments" that behave differently for smaller smartphone screens or bigger tablet displays (which can also be oriented vertically or horizontally).

The Gmail demo also showed off a few other impressive Honeycomb-native features, such as a "drag manager" that allows users to drag a message from the list pane into the neighboring folder pane.

Along the top of the display, a dynamic application bar includes controls that change depending on a given situation—for example, enabling bulk actions if you've got multiple e-mail messages selected versus individual actions for a single selected message.

Google execs also showed off Honeycomb's native video chat features, even pulling in Grammy nominee Cee Lo Green (who chose "Lady Killer" as his handle) for an impromptu call.

Games in Honeycomb will be able to take advantage of 2D hardware acceleration with the addition of a single line of code, Google execs said, while a new 3D rendering engine, dubbed "RenderScript," will allow for polished 3D graphics. The developers of the PlayStation 3 title Monster Madness showed off a reasonably slick-looking, RenderScript-powered port of the game for Honeycomb, while the hundreds of marching troops in strategy title "Great Battles Medieval" was said to push the Xoom's dual-core processor "to the limit."

CNN was also on hand to demonstrate a Honeycomb version of its tablet news app, complete with streaming video and the ability to upload video snippets to the network's iReport site.

— Ben Patterson is a technology blogger for Yahoo! News.

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How Google removed the muzzle on Twitter in Egypt

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Even before his first day on the job at Google, Ujjwal Singh was trying to figure out how to use his passion for the spoken word and the company's technological prowess to help Egyptians bypass government efforts to muzzle the massive protests there.

Singh, 38, helped start an online service that lets fans share voice messages with the likes of Miley Cyrus and the Jonas Brothers. Google bought the startup Jan. 25, and a Google product team leader trying to figure out a way around Egypt's recent Internet blackout asked Singh for help before he reported to work.

A weekend of brainstorming and programming later, Speak2Tweet was born — a service that lets people call a phone number and leave a message, then posts a link to the message to Twitter.

It allowed Egyptians to communicate even as the regime of President Hosni Mubarak cut Internet and cell phone services for days, trying to squelch furious protests in the streets of Cairo demanding an end to his three decades of authoritarian rule.

By the time Singh started his job Monday, his service was already part of the uprising.

"He designed, built and launched his first product before he started at Google, which is now our all-time record," says Steve Crossan, a Google product manager who has been working at the Internet search leader for five years.

Almost 2,900 spoken tweets had been posted as of Friday afternoon on the Twitter account (at)speak2tweet. Some of the heaviest volume came after access to both Twitter and the Internet was restored in Egypt earlier this week. The alternative method of tweeting has turned into a forum for longer-form expression because the voice recordings aren't confined to Twitter's 140-character limit.

Another Twitter account, (at)AliveInEgypt, has been set up to transcribe the messages, which are mostly in Arabic, into text. An Internet radio station also is playing the voice recordings at http://egypt.periszkopradio.hu.

The service has been used to express outrage, indignation, fear, exhilaration and pleas for help in the fight to oust Mubarak. "This corrupt regime must be eliminated," said one of the translated tweets on AliveInEgypt. Another said: "For all our Arab Brothers, for all the men in Tahrir Square. Please help us, stand with us, if you abandon us we will die."

One woman, speaking in English, said it would take more than an Internet blackout to silence her. "The last time when they did this I was completely freaked out," she said. "I was so scared that they are going to, like, shoot us all and nobody would know about us. This time I am not scared at all. I feel like I want to tell them, `Bring it on.'"

There is no way to verify that every tweet came from the site of the protests, or even from Egypt. When the service can trace the country code of the call, it adds a note, or hashtag, specifying the location.

The service's use was limited by the very problem that created it: Without Internet access, most Egyptians didn't know Speak2Tweet existed, says Jillian York, a project coordinator for the Berkman Center for Internet & Society in Harvard University.

Even so, it provided a vital link between Egypt and the rest of the world, says Cynthia Wong, director of the Center for Democracy & Technology's Project on Global Internet Freedom. As the word of the service spreads, York expects it to attract more voice messages because only about one-fourth of Egypt's population has Internet access.

"It's important for activists and companies to do everything they can to keep the channels of communication open when a government is trying to shut them down," Wong says.

The service got its start Jan. 28, when Crossan began to wonder how people might be able to get their messages out to a mass audience without the help of Internet or text messaging on mobile phones.

Crossan says he wasn't interested in making a political statement — he just wanted to tackle a complex problem that also might further Google's crusade to "organize the world's information and make it universally accessible."

So Crossan contacted a former Google colleague, Katie Stanton, who now oversees Twitter's international services. She referred him to Benjy Weinberger, another former Google employee who is now a Twitter engineer. The two men spent the rest of Friday swapping ideas through instant messages and e-mail.

Cooperating with Google on the project was a no-brainer for Twitter. "Twitter is more about human communications than technology," Stanton says. "We want people's voices to be heard."

Initially, Crossan and Weinberger tinkered with a system that would interpret the tones of a telephone keypad and translate the sounds into tweets. After that idea proved too complicated, Crossan remembered something he had read earlier in the week: Google had just acquired a Palo Alto, Calif., startup called SayNow, which developed technology that lets teens exchange spoken messages with celebrities.

Crossan, 39, decided to contact SayNow's founders, Singh and Nikhyl Singhal, about the problem before they were scheduled to start work for their new parent company.

Crossan was helping his 2-year-old son ride a bike for the first time in a neighborhood park Saturday morning when he heard back from Singh. The two men figured they might be able to develop a voice-to-tweet service by building on the same technology SayNow used.

"Voices capture emotion, personality and the moment," Singh says. "It gives you the intangible that you can't get through text and data."

The idea had another appeal: It would work whether the person was calling on a rotary telephone or a smart phone.

With the help of Google employees in Switzerland and Australia, the new tweeting service was taking shape late Saturday night when Crossan realized he had overlooked one detail: He hadn't even told Google what he was doing.

That wasn't a major oversight because Google co-founders Larry Page and Sergey Brin have always encouraged engineers to devote 20 percent of their time to pet projects. In theory, the freedom is supposed to foster new ideas and drive employees to work harder so their pet projects might turn into actual products more quickly.

The formula worked well in Google's early days, but the pace of innovation has slowed as the company grown to more than 24,000 employees. Google CEO Eric Schmidt is stepping aside from that job in April and handing the reins to Page as part of an effort to weed out bureaucracy and accelerate decision-making.

In Crossan's case, he saw that one of his bosses, Bradley Horowitz, happened to be online late Saturday. Crossan e-mailed him about the new service. Crossan said Horowitz told him the idea was "awesome." Crossan and Singh spent the rest of the night spent coding.

Although the speak-to-tweet service was available before dawn Sunday morning, it didn't attract a lot of attention until Google announced it on its corporate blog Monday afternoon.

Now, Crossan and Singh are hoping the speak-to-tweet survive will survive long after Egypt quiets down. If nothing else, they say it will serve as a reminder that phones still can serve another purpose besides texting and surfing the Web.

By MICHAEL LIEDTKE, AP Technology Writer

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Germany sells vision for 'green toys' to world

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The hottest "green" toy in Germany isn't made of organic or recycled materials. That's so 2010. This one has a solar panel and only runs if kids remember to insert bright red "energy stones" that power the rest of the space station.

Germany, a pioneer in many renewable energy initiatives, is also at the forefront of creating environment-friendly toys aimed at making kids think about where energy comes from and how much of it they can use, raising awareness through play.

A panoply of high-tech green toys are on display at this year's Nuremberg toy fair, which runs through Sunday. Among them, hydroelectric-powered toy cars, and doll houses with wind turbines and rainwater catchers.

The bright green "Future Planet" space station features an inner atrium with a fan that is powered by a functioning solar cell. Its aim is to get kids to use their imagination about how energy will be created in the future.

Makers and retailers believe such toys will play an increasingly important role in their future — and that of our kids.

"Energy is the question of the future and we are definitely thinking about this as we move ahead," said Judith Schweinitz, a spokeswoman for Playmobil, maker of the solar panel-fitted space station. "It is increasingly being brought into our play concept."

Green toys — which range from those made of sustainable materials to ones like the space station that just raise environmental awareness — make up only a sliver of the nearly $84 billion international toy market, but their share is growing, studies indicate. Environmental research firm Earthsense, based in Syracuse, New York, predicts that green toys will account for about $1 billion, or 5 percent, of U.S. toy sales in the next five years.

Stacy Lu, a 46-year-old mother of twins from Allendale, New Jersey, is a self-described "rabidly eco-friendly" consumer who has researched toxins in the household — and is drawn to toys that make kids think about the planet's future.

"In my mind, just knowing that there are alternatives to energy sources that involve environmentally disastrous digging and drilling is important," said Lu, who recently bought her godson an alternative-energy electrical kit as a gift.

Eco-friendly toys were given a special section at the New York toy fair last year and organizers of the Nuremberg fair, Germany's leading international gathering of toy makers and sellers, also highlighted green toys.

Robert von Goeben, co-founder of San Francisco-based Green Toys Inc., started making toys and other children's products from recycled milk jugs in 2008. Since then, he said, sales have exploded, recording 80 percent growth last year as demand for the toymaker's bright tugboats, pastel tea sets and colorful trucks surged.

"I think that the success of our company, shows that there is clearly a wide segment of the population that will pay a little more for environmentally friendly toys," said von Goeben, whose toys cost roughly a third more than comparable playthings made from conventional materials.

But Wild Toys, makers of animal figures and exploration sets, said their experience had shown otherwise.

The company, which sells mainly to zoos and museum shops, jumped on the green bandwagon two years ago, bringing out a line of purely organic plush animals, even making sure the cotton for the stuffing was grown with organic fertilizer. The toys cost about 25 percent more than their conventional counterparts.

"They are still sitting in our warehouse," said Wild Toys spokesman Valdemar Barde, adding that consumers are not yet ready to swallow the cost of going green in the toy box.

"We are still in that phase on toys that consumers say, 'Yes, we want to be green, but no, we don't want to pay for it."

But according to a survey conducted by the Nuremberg toy fair, roughly a third of consumers in Germany said they would pay 10 to 20 percent more for playthings made from sustainable products, also with an eye to their longevity.

"Sustainable toys are also high-quality toys, meaning they last longer and then we also have the aspect that it is worth it to invest a few more euros," said Rainer Weisskirch spokesman for Germany's TUV quality control organization.

Von Goeben noted that safety concerns play a role and that recent scandals over cadmium in many Chinese-made toys and BPAs in conventional plastics have made parents more concerned about what goes into their kids' toys.

"No longer can we have this anonymous plastic thing from someplace and give it to the child. Parents are smart and they want information about what's in the product. That's what's really driving the market."

By MELISSA EDDY, Associated Pres

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BUYING GUIDE.

Verizon Wireless on Friday said its first day of taking online orders for the iPhone produced record sales, and it's stopped taking orders until Wednesday.

The cell phone carrier said that in just two hours Thursday morning, between 3 a.m. and 5 a.m., more customers had ordered the phone than in the full day of any previous phone launch.

The company didn't specify how many iPhones had been ordered. It halted orders at 8:10 p.m. Thursday, and said it will resume taking orders at 3 a.m. on Wednesday.

It's only taking orders from current Verizon subscribers. The phone will be available in stores for the general public next Thursday, but supplies are likely to be tight.

AT&T Inc. has so far been the exclusive carrier of Apple Inc.'s popular phone in the U.S. It activated 15.2 million of them last year. Analyst estimates for Verizon iPhone sales this year vary widely, from 5 million to 13 million. Analysts expect the sales to Verizon subscribers will be strong, but the big question is how many iPhone buyers will be jumping ship from other carriers.

Barclays Capital analyst James Ratcliffe wrote in a research note Friday that he had been expecting that AT&T would still be able to add a net 250,000 subscribers on contract-based plans in the first quarter, but news of the strong iPhone pre-orders on Verizon prompted him to lower that forecast to zero.

Verizon shares fell 7 cents to close at $36.31. AT&T shares fell 2 cents to $27.97. Both stocks are close to their two-year highs.

Verizon is offering trade-in rebates for new customers, which can help offset the cost of breaking a contract with AT&T. For instance, it's offering $212 for a 16-gigabyte iPhone 4 in good condition. AT&T's fee for breaking an iPhone 4 contract early is $325, but that's pro-rated by $10 per month.

On Thursday, Verizon revealed that it will slow down traffic for heavy data users on unlimited plans if they're hogging the local cell tower. This only applies to subscribers signing up for a new data plan, or renewing a contract. Since the unlimited data plan is required for the iPhone, Verizon is reserving the right to throttle all iPhone traffic.

It also said it will conserve data capacity by recoding all online video requested by data subscribers. It said the effect on image quality should be minimal.

By PETER SVENSSON, AP Technology Writer

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iPhone App Strips Out Spam to Turn Twitter into a News Reader

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Web denizens are turning to social sites to find and consume news more and more. Smartr, an iPhone app released in mid-December, is going after the social news crowd who turn to Twitter for their daily news fix.

Smartr for iPhone [iTunes link], which comes from natural language processing startup Factyle, gathers all the tweets in your Twitter timeline and determines which of them have meaningful content. The app then fetches the web pages housed within tweets and optimizes the content -- text, images and video -- for iPhone.

Instead of seeing tweets, the Smartr user views a Twitter feed filled with news snippets. "It's a lens on top of your Twitter Feed," says Factyle founder Temo Chalasani.

Users can click on updates in the filtered Twitter stream to read a Smartr reformatted, ad-free version of the article, share it with Facebook, Tumblr or Posterous, and choose to save it in-app or via Instapaper or Read it Later.

The application is best suited for news junkies who want an experience that automatically filters out checkins, badges, stickers and updates of the same ilk -- updates the startup considers "Twitter spam."

Poorly formatted articles with excessive ads will also get caught in Smartr's spam filter, according to Chalasani.

The still-nascent application has a small but highly engaged audience, says Chalasani. App users are making Smartr their primary way of consuming content, and the team added in support for Twitter lists after its community clamored for the feature, he says.

Smartr just released an API, and next up is an iPad app slated to go live in 10 to 14 days. Future plans include feature updates to make Smartr even smarter -- think automatic queries that pull in Twitter, Facebook or other web info on people mentioned in articles. The company may also add price tags to the applications down the line.

The team behind Smartr spent two years building their natural language processing technology and was awarded a $160,000 grant from the Canadian government in the process, according to Chalasani. Factyle has since opted to focus on applying its technology to mobile to engineer a more fluid content consumption experience.

Factyle is operating on funds supplied by friends and family, but is actively seeking outside funding. The startup's line of mobile applications fall within the same category has those offered by the arguably more flashy Flipboard or Pulse. Factyle is betting that a significant pool of users will prefer the utility of Smartr over the magazine-style of the others.

Mashable by Jennifer Van Grove

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Man Used Facebook to Try to Blackmail Girl for Porn

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A 27-year-old California man pleaded guilty Wednesday to charges that he tried to coerce a 14-year-old girl into sending him pornographic videos by threatening to publicize sexually explicit pictures of her that he'd dug up.

Starting in December 2008, James Dale Brown used Facebook to contact the girl, who lived out-of-state, demanding that she send him a video of her having sex.

Somehow he'd obtained photos of the girl, some of which were sexually explicit. He said that if she did not send him a video, he would send the pictures to the unidentified victims' underage friends. If she sent the video, he promised to "delete all pictures of her 'from the Internet,'" the U.S. Department of Justice said Wednesday in a statement.

Brown, a United Parcel Service (UPS) worker who used the alias "Bob Lewis" on Facebook, finally carried out his threat on April 18, 2009, sending links to an explicit image of the girl to one of the victim's friends. Five days later, the U.S. Federal Bureau of Investigation raided Brown's Fremont, California, residence. He was arrested on Aug. 26, 2010.

Brown's lawyer, Robert Beles, could not be reached immediately for comment.

Just last month, another California man, George Bronk, admitted to breaking into more than 3,200 e-mail accounts in a hunt for explicit photos of women. He would use Facebook to learn answers to the security questions that Web-based e-mail services use to reset passwords and then use that information to break into his victims' Gmail and Yahoo Mail accounts.

Bronk ultimately convinced one woman to send him even more explicit photographs before he was arrested last year.

It isn't surprising that there are so many of these images in women's e-mail out-boxes and mobile phones, according to Amanda Lenhart, a senior research specialist at the Pew Internet & American Life Project.

According to her, a May 2010 Pew survey found that 6 percent of adults have sent a "suggestive nude or nearly nude photos of themselves to someone else via text messaging," a practice known as "sexting," she said in a January e-mail interview. Amongst 18-to-29 year-olds, that group jumped to 13 percent.

In another survey, Pew found that 15 percent of cell-phone owning teenagers had been sent sexually suggestive photos or videos of someone they know.

Brown could face 30 years in prison on the extortion and child pornography charges. He's set to be sentenced on May 11.
PC World

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Emerging markets boost Vodafone and Teliasonera

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Strong demand from emerging markets and from smartphone users helped cellphone operators Vodafone and TeliaSonera lift sales last year and give cause for confident outlooks for 2011.

Vodafone, the world's largest mobile operator by revenue, nudged up its profit forecast for the year to end-March on Thursday, while Sweden's TeliaSonera cheered investors with a $1.6 billion share buyback, lifting its shares 2.9 percent.

Vodafone's service revenues in the last three months of 2010 rose 2.5 percent, in line with market expectations, thanks to strong demand in India and some improvements in Europe, although analysts said concerns remained about the business on its home continent.

Vodafone has made some of the biggest bets on emerging markets, including spending $11.1 billion in India in 2007 to get a 67 percent stake in what is now Vodafone Essar.

While demand is growing rapidly, the Africa, Middle East and Asia Pacific division is still worth only 30 percent of group sales. It grew 9.3 percent on an organic basis in the third quarter, while European revenue edged up only 0.2 percent.

The British-based firm said it now expects adjusted operating profit for the year to end-March to be toward the upper end of its previously stated 11.8 to 12.2 billion-pound range ($19.1 to $19.8 billion).

But Vodafone shares were down 0.9 percent at 175.5 pence by 3:34 a.m. ET, the weakest performer in a flat Stoxx 600 Europe telecoms sector index.

Liberum Capital analyst Mark James said the headline numbers were good but noted that Europe was still tough and particularly so in Spain. Other analysts reckoned that the Vodafone share price was close to its fair value.

Vodafone has also recently restructured its business to now include the faster-growing Turkish market in its European division. In its previous structure, European service revenue was down 0.9 percent, following a fall of 0.8 percent in the previous quarter.

"One of the reasons we are not more enthusiastic on Vodafone is that its European operations, which generate some 70 percent of group EBITDA, are still going backwards," James said.

SMARTPHONES

Nevertheless both Vodafone and Teliasonera said they had benefited from increased demand for internet services. Mobile operators initially struggled to profit from the explosion in data traffic but many, including Vodafone, are now retreating from flat-rate tariffs.

Vodafone's data service revenue rose 27 percent in the last three months of 2010, while Telia said seven out of every 10 phones it sold in Sweden were now smartphones, whose users spend more time surfing and using premium services, boosting revenues.

Vodafone Chief Executive Vittorio Colao said: "Our performance has been driven by the effective execution of our strategy to strengthen our businesses and deliver growth, particularly in data services and emerging markets."

TeliaSonera, Europe's fifth-biggest operator by market value, said it expected sales in local currencies excluding acquisitions to grow 4 percent this year, though the strong Swedish crown could impact reported figures.

"This will mainly be driven by mobile data in the Nordic region, increased market share in Spain and higher mobile penetration in Eurasia," the company said in a statement.

Vodafone's improved outlook followed solid trading in its fiscal third quarter, with strong growth in India and Turkey and improvements in Britain, Germany and South Africa.

However, the Spanish market was worse than expected, with revenues down 7.4 percent.

Its business in Spain, which grew strongly for several years before the recession hit, has been particularly affected by thousands of migrant construction workers leaving the country and cancelling their contracts.

The group did add subscribers in the third quarter but with prices falling due to competition its revenues slumped. In contrast TeliaSonera, which has held onto customers by offering lower rates in the first place, said it expected to grow further in Spain.

TeliaSonera, which has also seen a growing share of income in recent years from markets like Kazakhstan, Uzbekistan and Azerbaijan, said its overall costs would grow less than sales, and its core profit margin should rise compared with 2010.

On Thursday British fixed-line operator BT and Danish operator TDC said they had also benefited from cost cuts and some analysts suggested investors should switch from Vodafone to BT.

(Reuter Writing by Georgina Prodhan; Editing by Greg Mahlich)

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Dell Releases Ubuntu-powered Cloud Servers

BUYING GUIDE.

Dell has released two servers for the U.S. market that have been customized to run Ubuntu-based cloud services, the company announced Wednesday.

Dell has outfitted its PowerEdge C2100 and C6100 servers with Canonical's Ubuntu Enterprise Cloud (UEC), an implementation of the Eucalyptus private cloud software that runs on the Ubuntu Server Edition operating system.

Dell is marketing the servers to organizations developing applications to run on Amazon Web Services (AWS). Organizations could use the servers to test the applications locally before uploading them to Amazon's paid service. The servers have a preconfigured testing and development environment. Eucalyptus duplicates the AWS APIs (application programming interfaces).

Partnering with Canonical allowed Dell to deliver an infrastructure-as-a-service product in an integrated package and based on open standards, said Andy Rhodes, executive director of marketing for Dell's data center solutions division, in a statement.

In the suggested setup, the C2100 server acts as a cloud compute node, while the C6100 can act either as a cloud compute server or as both a server and a node.

It marks the first time that Dell has offered the Linux-based Ubuntu OS in servers, although it has used the desktop edition of Ubuntu for some of its netbooks, laptops and PCs.

In addition to the servers themselves, Canonical also offers a variety of enterprise support subscription plans, which start at US$1,175 per server per year.
PC World

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