megamusictour.com

(Credit:
Helio)

But it’s the companies’ differences that could really benefit a merged company. Even though both companies are going after a younger demographic, they are really addressing different segments of this population. For example, Virgin Mobile is a prepaid service that targets users who don’t have a lot of money to spend and who have poor credit or no credit history at all. By contrast, Helio is targeting high-end users, who spend an average of $85 a month on their cell phone service. Most wireless users only spend $50 a month on service from bigger carriers like AT&T and Verizon Wireless.

Even if the companies merged, it will still be a difficult market for them to survive. More than 84 percent of the U.S. population already subscribes to a cell phone service. And as the bigger carriers more aggressively address both the high end and low end of the market, it could be harder for Virgin Mobile USA and Helio to compete.

The main reason is that the companies’ businesses compliment each other nicely. Helio was originally created by Sky Dayton, EarthLink’s founder, to bring cool and cutting edge devices and services to the U.S. market. The original idea behind the company was to target a young technically savvy crowd. Virgin Mobile USA, a subsidiary of the European-based phone company, has made a name for itself as a hip brand also focused on the youth market.

Virtual cell phone operators Virgin Mobile USA and Helio are rumored to be in merger talks, a move that could bring a lot of benefits to both companies.

Now Helio has shifted its strategy to appeal to a wider audience. And Virgin Mobile, which has relationships with a wide circle of retailers and over 5 million subscribers, could significantly improve Helio’s reach.

While combining the two companies won’t magically solve all their problems, they may fare better as a combined entity rather than individually.

Over the past 18 months, Helio and Virgin Mobile USA have seen many of their MVNO brethren die. ESPN Mobile, Disney Mobile and youth-targeted Amp’d Mobile have all closed shop.

As the economy tightens and other larger wireless carriers look to consolidate, it makes sense for these smaller players, who essentially resell service from Sprint Nextel, to look for alternatives. The companies are also rumored to be in talks with private equity firms.

Virgin Mobile could greatly benefit from Helio’s high-end customers, who are voracious data users. In 2007, Helio subscribers sent an average of 550 text messages per month. And 95 percent of the company’s subscribers accessed the Web through their mobile device compared the industry average of just 13 percent.

On the flip side, Virgin Mobile USA gives Helio the opportunity to expand its customer base. Initially, Helio only tried wooing a small niche of technology elite, a set of high-end consumers who wanted cool phones and were willing to spend a lot on new services and devices. But then came Apple’s
iPhone, which literally changed the game overnight. And the very people Helio wanted to entice with cool devices, such as the Ocean, were instead more interested in an iPhone.

The tie-up between the two MVNOs, or mobile virtual network operators, was first reported Thursday by the wireless blog MocoNews. According to the blog, SK Telecom, one of Helio’s parent companies, would buy out Virgin Mobile USA and then Virgin Mobile would buy Helio in an all-stock transaction.

And even though Virgin Mobile USA and Helio are still in business, the companies have not been immune to the increasingly competitive market place. For the first quarter of 2008, Virgin Mobile USA reported that its earnings fell 75 percent compared to a year ago. Meanwhile Helio, which is jointly owned by South Korean carrier SK Telecom and Internet service provider EarthLink, lost $327 million in 2007 on $171 million of revenue. All told, the company has lost more than $560 million since it was started in 2005.

Not so great.

The world’s best record store will go online. Totally wrong. Amoeba is still firmly planted in the bricks-and-mortar world–California, specifically. Chalk this one up to wishful thinking.

The loudness wars will end. This is a bit subjective–you’d need a detailed sonic analysis of releases during 2008 to prove it–but I don’t hear quite as much over-compression as I did a couple years ago on mainstream radio. That said, Metallica’s Death Magnetic was slammed for continuing this unfortunate trend–some listeners thought the music sounded better on Guitar Hero than on CD!–so I’ll have to say I was wrong.

3G
iPhone and iTunes. Wrong. I can’t really take credit for predicting a 3G iPhone, since the CEO of AT&T had already let that slip, and Apple surprised me by refusing to open the wireless iTunes store to downloads over 3G.

The concert business will follow the recorded music business down. I was wrong in the specifics–revenues were actually up from 2007–but only because average ticket prices were higher. Attendance was down 2%, a smaller drop than the 20% last year.

GarageBand will win a Grammy. Wrong. I still expect a recording made with GarageBand or another low-cost digital audio workstation to win a Grammy someday, but it didn’t happen in 2008.

Here’s a rundown of where I was wrong–and right.

Mashups will go mainstream. Half a point. I read more about mashups this year than any year since 2005: music critics expended a lot of digital ink on GirlTalk’s latest album, Feed the Animals, which consists entirely of samples. But the rest of the world didn’t care much–the pay-what-you-want download didn’t exactly light up the Web like Radiohead’s In Rainbows did, and the CD (released Nov. 11) didn’t crack Billboard’s top 200 albums of the year.

Two out of ten–ouch–although I was heading in the right direction on a few others, just moving too fast.

No Zune phone. Right. Microsoft hasn’t even announced a Zune client for Windows Mobile or other types of phones, although I expect an announcement of some sort next week at CES.

DRM will die. I’ll give myself half a point here for predicting that all four labels would agree to sell DRM-free tracks on Amazon (Sony capitulated only 11 days into 2008), and for the fact that Microsoft added 10 permanent DRM-free downloads per month to its
Zune Pass subscription offering. But I was completely wrong about iTunes–the vast majority of songs on the service still come with DRM, and iTunes Plus is still alive and well. More to the point, Amazon and other DRM-free services haven’t made a dent in iTunes’ dominance.

Will I do better in 2009? I’ll lay out my predictions for the coming year tomorrow.

Led Zeppelin will play again, but not tour. More wishful thinking–Robert Plant wasn’t interested.

Update, 1/6/09: Today during the MacWorld keynote, Apple announced that it would offer the vast majority of songs for sale on iTunes without DRM restrictions, and would begin making iTunes downloads available over 3G cellular networks as well as Wi-Fi connections. Six days–I’ll take a mulligan, raising my batting average to .350.

Predictions columns are always risky because it’s easy to look back a year later and see how wrong you were. For the most part, I was on the right track, but too bold–as a wise prognosticator once said, we tend to overestimate the amount of change that will happen in one year, and underestimate the amount of change that will happen in ten.

Year Zero will become the precedent Wrong. Nobody else went to such lengths in 2008 as Trent Reznor did in 2007 to promote Nine Inch Nails’ Year Zero. Lack of creativity? Or just too much work? A few artists, including The Fireman (Paul McCartney and Youth) and David Byrne and Brian Eno, experimented with online-first releases and packages at multiple price points, two other trends that Nine Inch Nails was early to embrace. But as far as full interactivity goes, Trent stands alone.

The two sides have talked on and off, he said, first about a purchase and then about a search deal.

He repeated his familiar refrain that Microsoft will ultimately be able to rival Google with or without Yahoo.

Ballmer did acknowledge it faces a bit of a Catch-22 with search. With lower query volume, it attracts fewer advertisers and thus gets less revenue per query. That hurts its relevance with its ads.

“At the right price and with the right speed of operation it was a heck of good (option),” he said of Yahoo. “Yahoo for us was always a tactic, not a strategy.”

“That’s something they will launch in the fall,” Nadella said.

(Credit:
Corinne Schulze/CNET Networks)

Search unit head Satya Nadella said that Microsoft is also expanding its Facebook relationship into search. Microsoft will deliver an API (application programming interface) that Facebook can use to integrate both Microsoft’s Web search and its paid search results into the social-networking site.

“Now we aren’t (talking) and that’s where things are,” Ballmer said, speaking at Microsoft’s financial analyst meeting here. “There is nothing under discussion between the two of us.”

And Ballmer did reopen the Yahoo door a crack. “Does that mean nobody will ever talk?…I suspect not.”

Ballmer’s comments followed an earlier discussion of the continued investment (losses) that Microsoft expects as it spends money in its online business.

He said there were other options around this Catch-22, but said he wasn’t going to go into those Thursday.

REDMOND, Wash.–CEO Steve Ballmer said Thursday that its on-again, off-again talks with Yahoo are firmly in the “off-again” phase.

Ballmer: No current talks with Yahoo.

A new company is launching with the intent of acquiring patents to shield technology companies from costly patent lawsuits.

Patent trolls have raised more than $6 billion over the last 10 years to acquire patents to initiate lawsuits, RPX says on its Web site. eBay went all the way to the Supreme Court in a patent dispute with MercExchange, a small Virginia-based company claiming that the online auctioneer had infringed on three of its patents. The two companies eventually reached a settlement agreement.

RPX will sell memberships to companies for a fixed annual fee that could range from $35,000 to $4.9 million, depending on the member company’s operating income. For the price of the annual membership, companies will receive the patent licenses purchased by RPX. The Wall Street Journal reported that Cisco Systems and IBM have already signed up.

RPX, a San Francisco-based start-up, calls itself a “defensive patent aggregator.” The company plans to buy available patents to keep them out of the hands of “patent trolls,” or firms that obtain patents for the purpose of suing other companies for royalties or licensing fees.

RPX says it has acquired 150 U.S. patents and has submitted 60 U.S. patent applications worth a total of $40 million in areas including Internet search, radio frequency identification, and mobile technology.

RPX is financed by two venture capital firms, Kleiner Perkins Caufield & Byers and Charles Rivers Ventures. Its two chief executives, John Amster and Geoffrey Barker, previously served as vice presidents of Intellectual Ventures, another company in the business of purchasing patents.

Fujitsu plans to ship the MHZ2 CJ series starting this summer.

Unlike encryption with
Windows Vista BitLocker, which requires the operating system to be present, the new Fujitsu drive performs its encryption entirely within the BIOS during power on. Encryption performed within the BIOS prevents the keys from being stored in the clear anywhere on the drive.

On Monday, Fujitsu Computer Products of America announced the Fujitsu MHZ2 CJ series for business notebooks that features full disk encryption. The new 2.5″ 7,200RPM SATA hard disk drive (HDD) incorporates the AES-256 encryption standard at the hardware level without the need for additional software.

According to Fujitsu, “the key used to encrypt and decrypt data is cryptographically regenerated at power-on, and is not known even to the HDD when the system is powered off.”

Also, since all the encryption generation is done as the laptop is being powered up, there is virtually no performance hit whenever the 256-bit password key is generated.

(Credit:
Fujitsu Computer Products of America, Inc.)

(Credit:
NYTimes.com)

We first reported on the debut of TimesPeople in June, when it was still being tested as a
Firefox plugin. Now it’s been fully worked into the NYTimes.com site with no download required.

The New York Times has started rolling out TimesPeople, a sharing-and-recommending tool that the publication first announced earlier this year. It’s essentially an extension of the free user accounts that are already required to read the Times’ Web site: You can now build up a friends list, recommend stories to people you know, and see what they’ve been recommending or commenting on.

The TimesPeople toolbar shows the latest activity in your social circle.

In other words, it’s a social news feed for Times readers. You can also sync it up with your Facebook account to push your feed–stories you’ve commented on or recommended–to your profile on the social network.

(Credit:
SRI International)

SRI International has announced the development of a wall-climbing robot that uses a new electrical adhesive technology called “compliant electroadhesion” that can stick to anything from brick to glass–even damp, dirty glass.

(Credit:
SRI International)

Electroadhesion lends itself to a variety of wall-climbing robots, including tracked “tank”-style robots, as well as the more biomimetic-inspired, legged and inchworm-type robots, according to the company. The robots are simple, low-cost, easy to clean, and readily conform to different surfaces like bumps, corners, or cracks. And they’re quiet, unlike other wall-climbers that use suction technology.

“Recent events such as natural disasters, military actions, and public safety threats have led to an increased need for robust robots–especially ones that can move in three dimensions,” said SRI mechanical engineer Harsha Prahlad. “The ability to climb walls and other structures offers unique capabilities in military applications, such as urban reconnaissance, sensor deployment, and installation of network nodes in an urban environment.”

Electroadhesion, or electrically controlled electrostatic attraction, is an electrically controlled adhesion technology that induces an electrostatic charge using a power supply connected to pads placed on the robot allowing it to scale walls, even those covered with dust or moisture, SRI says.

I didn’t pay much attention to VirtualBox when Sun Microsystems first acquired Innotek, but RedMonk’s Michael Coté just posted an interview and demo of the software, and it’s very cool.

On the Mac, I’m not sure it’s any better than Parallels, but it is open-source, which should be very appealing for many users.

VirtualBox is a free download available under the General Public License, or GPL.

In a few clicks, you can see VirtualBox create a Vista instance and run it on the
Mac. There are many options for virtualization at this point, but I would expect Sun to make this its weapon of choice (versus Xen), since it owns it and can tweak it for Solaris.

If there were ever a place for Defensive Computing, it’s at a hacker conference.

The classic use for a VPN is an employee of a company using it to make a secure, encrypted connection to the office. But someone without a corporation, can rent a VPN that offers a secure connection to the VPN provider. Once data gets to the VPN company, it is dumped, unencrypted, on the Internet with everything else. The point is to encrypt everything coming into and out of your computer to protect it from any local bad guys.

Something easily overlooked when connecting to public networks is file and printer sharing. While it’s not the be all and end all, you’re safer with it turned off. Windows XP users can find this with Control Panel -> Network Connections -> Properties of the network connection (you may want to do this for both wired and wireless networks) -> General tab -> checkbox for “File and Printer Sharing for Microsoft Networks.”

So while attending the Last HOPE conference, a number of my previous postings came to mind.

Update July 19:
Added topics on file and printer sharing and turning off the radio–thus proving, they are easily forgotten.

Some laptops have a physical switch that turns off the radio. ThinkPads use Function-F5. As a last resort, Windows XP users can disable the Wi-Fi network. In my experience, that also turned off the radio.

What to do? Rent a personal VPN.

First, there was the list of available Wi-Fi networks (see below) at the conference which, at times, showed four computer-to-computer networks (using the Windows XP terminology). These networks, also known as ad-hoc networks, are not governed by a router. While they may be set up on purpose, they are more likely to be accidental creations on the part of nontechnical computer users, or a purposeful trap set by someone with ill intentions. I wrote about this back in May. (See “A warning about ‘free’ public Wi-Fi.”)

Everyone knows not to send anything sensitive, such as a password, over a wireless network. At a hacker convention, even a wired Ethernet connection to the outside world should be treated with caution. Not to pick on hackers, at any convention or at any hotel, a wired Ethernet connection deserves the same caution as a public wireless network. Back in January, I wrote that “wired connections to the Internet in a hotel are not, by their very nature, more secure than wireless connections.” (See Ethernet connections in a hotel room are not secure.)

The downside is speed. The speed test at Speakeasy.net showed that while I was connected to my VPN, the speed dropped by over half compared to using the Internet in an unprotected way.

The laptop I had with me was running the Online Armor firewall instead of ZoneAlarm, and as I noted a few days ago, I really missed not being able to see a log of intrusion attempts on my machine. At home, behind a router on my personal LAN, this isn’t very interesting. But at a hacker conference, using a shared Wi-Fi network, it would have been fascinating to see who, if anyone, was knocking on my virtual door.

Another easily forgotten protection involves turning off the wireless radio when you are not using it. This goes beyond the obvious issue of disconnecting from a public Wi-Fi network when you don’t need it. There was a case where, due to a bug in some driver software, a computer could be hacked even when it was not logically connected to any network. All that was needed was for the Wi-Fi radio to be physically turned on. Plus, turning off the radio saves battery power.

See a summary of all my Defensive Computing postings.

LG Electronics will add video streaming features from CinemaNow and YouTube to its 2009 lineup of networked Blu-ray players, the company said Tuesday.

With Tuesday’s announcement, LG Blu-ray customers will also get access to 14,000 movies and TV shows from CinemaNow. And they will be able to stream millions of Web videos directly from the Internet to an LG Network Blu-ray Player so they can watch it on their TVs.

The current economic slump is driving some consumers to cancel expensive cable or satellite TV packages and look for video content online. LG believes it can capitalize on this trend by making it easier for consumers to find entertainment online that can be viewed on their TVs.

The company will be showing off the new functionality at the Consumer Electronics Show (CES) next week in Las Vegas. (Click here for CNET’s complete coverage of CES 2009.)

LG launched its first network-connected Blu-ray player in July with partner Netflix. As part of the deal, viewers get access to more than 12,000 movies and TV shows from Netflix.

“As millions of U.S. consumers view and download movies or TV shows through the Internet, they are demanding easier ways to access content and more home entertainment options,” Tim Alessi, director of product development for LG Electronics USA, said in a statement. “From Blu-ray to instant streaming from Netflix to CinemaNow and YouTube, LG is bridging the gap between packaged media and video-on-demand services to provide entertainment solutions for consumers’ demand for content.”