Yahoo and Microsoft Gang up Against Google

YaSoft or MicroHoo? Yahoo and Microsoft have reached agreement on a long-awaited web search partnership that will unite the two companies against market leader Google.

Under the no-cash deal, Yahoo will use Microsoft's new Bing search engine on its own sites, while Yahoo will act as the exclusive global sales force for the companies' premium search advertisers.

According to research firm ComScore, Google has a 65 per cent share of the lucrative search market. The combined forces of Yahoo and Microsoft will have a 30 per cent market share.

Yahoo, which last year turned down a $US47.5 billion takeover bid from Microsoft, said it stood to gain about $US500 million in annual operating income and $US200 million in capital expenditure savings through the agreement with the software giant.

Yahoo also estimated the deal would provide it with a $US275 million benefit to annual operating cash flow.

"This agreement comes with boatloads of value for Yahoo, our users, and the industry. And I believe it establishes the foundation for a new era of internet innovation and development," Yahoo chief executive Carol Bartz said in a statement.

The partnership, Microsoft said, "will improve the Web search experience for users and advertisers, and deliver sustained innovation to the industry."

Microsoft chief executive Steve Ballmer said the deal will enable Bing to better compete against Goggle, as well as attract more users and advertisers.

"Through this agreement with Yahoo, we will create more innovation in search, better value for advertisers, and real consumer choice in a market currently dominated by a single company," Ballmer said.

"This agreement gives us the scale and resources to create the future of search."

The agreement, which has a 10-year term, will be subject to review by US regulatory authorities, the companies said.

It is restricted to internet search and related advertising revenue, while the pair would retain full autonomy on other properties and products such as email, instant messaging and display advertising.

Calling the link-up a "significant opportunity," Yahoo chairman Roy Bostock said the company's board backed it with its "full and unanimous support."

"Microsoft is an industry innovator in search, and it is a great opportunity for us to focus our investments in other areas critical to our future," he said.

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Intel And Yahoo Unites Internet With Television

Intel Corporation and Yahoo! Inc. previewed plans for the Widget Channel, a television (TV) application framework optimized for TV and related consumer electronics (CE) devices that use the Intel Architecture. The Widget Channel will allow consumers to enjoy rich Internet applications designed for the TV while watching their favorite TV programs. The Widget Channel will be powered by the Yahoo! Widget Engine, a fifth-generation applications platform that will enable TV watchers to interact with and enjoy a rich set of “TV Widgets,” or small Internet applications designed to complement and enhance the traditional TV watching experience and bring content, information and community features available on the Internet within easy reach of the remote control. The Widget Channel will also allow developers to use JAVASCRIPT, XML, HTML and Adobe® Flash® technology to write TV applications for the platform, extending the power and compatibility of PC application developer programs to TV and related CE devices. In addition to supporting the Yahoo! Widget Engine, Yahoo! will also provide consumers Yahoo!-branded TV Widgets that are customized based on its category-leading Internet services.

TV Widgets will enable consumers to engage in a variety of experiences, such as watching videos, tracking their favorite stocks or sports teams, interacting with friends, or staying current on news and information. Viewers will be able to use TV Widgets to deepen their enjoyment of the programming they are watching, discover new content and services, or share their favorites with friends and family. TV Widgets can be personalized because they will be based upon popular Internet services such as Yahoo! Finance, Yahoo! Sports, Blockbuster® and eBay® that viewers have customized for use in their daily lives.

"TV will fundamentally change how we talk about, imagine and experience the Internet," said Eric Kim, Intel senior vice president and general manager of the company's Digital Home Group. "No longer just a passive experience unless the viewer wants it that way, Intel and Yahoo! are proposing a way where the TV and Internet are as interactive, and seamless, as possible. Our close work has produced an exciting application framework upon which the industry can collaborate, innovate and differentiate. This effort is one of what we believe will be many exciting new ways to bring the Internet to the TV, and it really shows the potential of what consumers can look forward to."

"On the PC and mobile devices, Yahoo! is a leading starting point for millions of consumers around the world," said Marco Boerries, executive vice president, Connected Life, Yahoo! Inc. "Yahoo! aims to extend this leadership to the emerging world of Internet-connected TV, which we call the Cinematic Internet™. By partnering with leaders like Intel, we plan to combine the Internet benefits of open user choice, community, and personalization with the performance and scale embodied in the Intel Architecture to transform traditional TV into something bigger, better and more exciting than ever before. By using the popular Yahoo! Widget Engine to power the Widget Channel, we intend to provide an opportunity for all developers and publishers to create new experiences that can reach millions of TV viewers globally. Yahoo! plans to enable the Cinematic Internet™ ecosystem, which will benefit consumers, device makers, advertisers and publishers."

Widget Channel Framework and TV Widget Developers

Underlying the Widget Channel will be a powerful set of platform technologies, including the Yahoo! Widget Engine and core libraries that expose the powerful functions enabled by the Intel Architecture. The Widget Channel framework will use established Internet technologies to dramatically lower the barrier of entry for developing applications optimized for TV. To help create new TV Widgets for the Widget Channel, Intel and Yahoo! plan to make a development kit available to developers, including TV and other CE device makers, advertisers and publishers. The Widget Channel will also include a Widget Gallery, to which developers can publish their TV Widgets across multiple TV and related CE devices and through which consumers can view and select the TV Widgets they would like to use.

Intel and Yahoo! are working with a range of industry-leading companies that are planning on developing and deploying TV Widgets, including Blockbuster*, CBS Interactive*, CinemaNow*, Cinequest*, Comcast*, Disney-ABC Television Group*, eBay*, GE*, Group M*, Joost*, MTV*, Samsung Electronics Co., Ltd.*, Schematic*, Showtime*, Toshiba* and Twitter*. These and other companies and individuals will be able to innovate, differentiate and deploy TV Widgets across multiple TV and related CE devices using the Widget Channel framework. Additional information on the Widget Channel framework and the Yahoo! Widget Engine can be found at www.intel.com/go/celink and connectedtv.yahoo.com/newsroom.

Intel Architecture

Intel Architecture (IA) is at the heart of millions of PC-, MID- and server-based Internet clients, which has helped enable the proliferation of Internet-based content and services while providing users with an uncompromised Internet experience. Accelerating the delivery of the Internet to the TV, Intel today extended performance, headroom and connectivity of IA into a new family of "purpose built" system-on-chip (SoC) media processors for Internet-connected CE devices, including optical media players, U.S. cable set-top-boxes, digital TVs and other connected audio visual products.

Intel's first CE IA-based SoC, the Intel® Media Processor CE 3100 (formerly "Canmore"), is a highly integrated chip which includes a high-performance IA core and other functional I/O blocks to enable high definition video decode and viewing, home-theater-quality audio, 3-D graphics, and the fusion of the Internet and TV experiences. The Widget Channel software framework is designed to work with a new generation of Internet-connected CE devices based on Intel's purpose built SoC. The hardware and software compatibility of IA also provides support for broadcast and Internet content.

Intel also plans to release the Intel Media Processor CE 3100-based hardware development system called the "Innovation Platform" which will provide the initial development and validation environment for developers of TV Widgets on the Widget Channel.

An Open Framework

Finally, Intel and Yahoo! are working with industry members to promote the development of open and consistent standards necessary to grow the TV Widget ecosystem. As part of their efforts, the companies are sharing an early version of a development kit for the Widget Channel with selected TV Widget developers now.

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No Merger For Microsoft And Yahoo, Microsoft Can't Pay

MIGUEL HELFT and ANDREW ROSS SORKIN

Microsoft said Saturday that it was abandoning its blockbuster bid to acquire Yahoo after it raised its offer by $5 billion but Yahoo rejected it as still too low.

The about-face followed a meeting on Saturday morning in Seattle between Microsoft’s chief executive, Steven A. Ballmer, and Yahoo’s chief and co-founder, Jerry Yang, according to a person familiar with the talks.

At the meeting, which also included Yahoo’s other founder, David Filo, and a Microsoft president who oversees its online unit, Kevin Johnson, Mr. Ballmer increased Microsoft’s offer to $33 a share, or a total of about $47.5 billion, from $29.40 a share. Mr. Yang told Mr. Ballmer that Yahoo would not accept an offer below $37 a share, this person said.

“Despite our best efforts, including raising our bid by roughly $5 billion, Yahoo has not moved toward accepting our offer,” Mr. Ballmer said in a statement. “After careful consideration, we believe the economics demanded by Yahoo do not make sense for us, and it is in the best interests of Microsoft stockholders, employees and other stakeholders to withdraw our proposal.”

A person close to Yahoo said the price was not the only stumbling block. The person said Yahoo was also concerned that the deal could be blocked by regulators and wanted a higher offer, in part, as a hedge against that risk.

Microsoft’s decision to walk away casts a cloud of uncertainty over Yahoo and its shareholders. The breakdown in the talks is likely to send Yahoo’s shares plunging, and Mr. Yang and his team will have to decide how to placate investors.

The company has been exploring alternatives to a marriage with Microsoft, including a partnership in search advertising with its arch rival, Google, which could lift Yahoo’s profit and perhaps its stock price. Yahoo has also discussed possible mergers with the AOL unit of Time Warner and the MySpace unit of the News Corporation. The MySpace talks have not been active of late.

But both remaining options pose challenges. A Google partnership would be likely to attract scrutiny from regulators because of Google’s dominance over online search and advertising, while AOL and Yahoo have many overlapping businesses and technologies, making a merger difficult.

In a statement issued late Saturday, Mr. Yang said, “With the distraction of Microsoft’s unsolicited proposal now behind us, we will be able to focus all of our energies on executing the most important transition in our history.”

Reactions inside Yahoo are likely to be mixed. Several senior executives favored selling to Microsoft and said in recent days that they were hoping to see a deal happen. Yet other executives were high-fiving each other for defeating Microsoft’s bid, people close to the company said.

While its stock may fall on Monday, Yahoo’s management was encouraged by discussions with its largest investors in which they urged management to not accept $33 a share, these people said. For Mr. Yang, Microsoft’s withdrawal is considered a “personal victory,” according to one person who spoke with him.

Microsoft has spent years and billions of dollars trying to build an online business. Yet it has steadily lost ground to Google in the search business and has failed to gain significant momentum with advertisers.

Microsoft’s decision to abandon its pursuit of Yahoo is not necessarily the last chapter in the three-month-old saga. If Yahoo’s shares fall significantly, the company will be under intense pressure to act, and may choose to resume negotiations.

Earlier this year, under intense shareholder pressure, BEA Systems did just that, agreeing to a takeover by Oracle soon after Oracle dropped an unsolicited offer it had made for BEA.

“This seems like a very strong but serious negotiating tactic,” said Jonathan Miller, the former chairman and chief executive of AOL. “It will be up to Yahoo to come back to the negotiating table.”

Microsoft had threatened to pursue a hostile takeover if it could not come to an agreement with Yahoo’s management. That could have involved an appeal directly to Yahoo’s shareholders and an effort to remove members of Yahoo’s board of directors.

In a letter to Mr. Yang sent on Saturday afternoon, Mr. Ballmer wrote: “It is clear to me that it is not sensible for Microsoft to take our offer directly to your shareholders. This approach would necessarily involve a protracted proxy contest.”

He added: “Our discussions with you have led us to conclude that, in the interim, you would take steps that would make Yahoo undesirable as an acquisition for Microsoft.” Mr. Ballmer took particular aim at Yahoo’s discussions of a partnership with Google, noting that it would “make an acquisition of Yahoo undesirable to us for a number of reasons.”

Microsoft’s decision to abandon its bid is likely to raise questions among investors about the judgment of both Microsoft and Yahoo.

When Microsoft made its initial bid, it said Yahoo was an important part of its strategy to take on Google. Its choice to withdraw, after threatening to force a shareholder vote, may prompt its shareholders to doubt its resolve. At the same time, many Microsoft shareholders who did not want the company to bid for Yahoo may be relieved and send shares of Microsoft higher on Monday.

For Yahoo’s shareholders, the abandoned bid may create even more uncertainty over the company’s management. Many Yahoo shareholders would have preferred that the company accept the offer of about $47.5 billion, which was roughly 70 percent higher than the company’s market value at the end of January.

Over the last three months, the companies had infrequent talks, according to people involved in the negotiations from the start who were not authorized to be quoted by name.

Frustrated by the lack of discussions, Microsoft sent a threatening letter to Yahoo on April 5 suggesting that Microsoft would try to force a shareholder vote to circumvent Yahoo’s management if the companies could not reach an agreement within three weeks. At the same time, Microsoft began seeking a partner for its bid, holding talks with the News Corporation, controlled by Rupert Murdoch, as well as AOL. Both of those companies had been holding concurrent negotiations with Yahoo about their own partnerships.

On April 15, Microsoft and Yahoo held a secret meeting in Portland, Ore., in which the companies discussed “social issues” — like who would run the Yahoo unit if it were folded into Microsoft — but no decisions were made.

Three days later, bankers for Microsoft and Yahoo held a conference call in which Yahoo’s bankers suggested that $40 a share would be a “slam dunk” that would get the deal done. A week later, Microsoft’s deadline passed without Microsoft proceeding with a proxy contest as it had threatened. Microsoft decided that it would still try to seek a friendly deal and that a hostile bid could impair the value of Yahoo.

Last Tuesday, three days after the deadline, Mr. Ballmer and Mr. Yang had several telephone conversations as Yahoo sought to reach a deal to keep Microsoft from turning hostile. In those talks, Mr. Yang overruled his bankers, telling Mr. Ballmer that Microsoft did not have to go as high as $40 a share to get a deal done, and suggested that they begin negotiations.

The next day, Microsoft and Yahoo began talks in earnest, pulling in dozens of bankers and lawyers to try to reach a deal. Mr. Ballmer flew to Yahoo’s headquarters in Sunnyvale, Calif., where Mr. Yang said Yahoo would be willing to accept nothing lower than $38 a share. Each dollar per share is equal to about $1.4 billion.

Microsoft pushed back, saying it would pay no more than $33 a share. The talks culminated in a final meeting on Saturday in which Mr. Yang flew to Seattle to meet with Mr. Ballmer. Mr. Ballmer stuck to his $33 price, and Mr. Yang said Yahoo’s board would accept $37 a share. Hours later, Mr. Ballmer sent Mr. Yang the letter saying Microsoft would withdraw its bid.

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Could This Be The End Of Yahoo! ???

Eric Auchard

As Yahoo Inc approaches the end of a 100-day strategic review, financial analysts want drastic action or even a sale of the company, although many are bracing for business as usual.

Chief Executive Jerry Yang raised hopes that major change might be in store, telling investors shortly after he took the helm of the internet media company in July that nothing was a "sacred cow."

Since then Yahoo has embarked on a series of modest acquisitions to enhance key businesses such as advertising and collaboration software, while shuttering marginal services and further reorganising management of its central ad sales force.

But nothing so far resembles the radical surgery many financial analysts argue is indispensable.

Some critics say Yahoo should exit the web search business and partner with market leader Google Inc.

Barring that, they say Yahoo should sell itself to a deep- pocketed partner such as eBay, Microsoft, News Corp or AT&T Inc to create a new internet behemoth to compete with far faster growing Google.

"There is only one type of Yahoo shareholder right now: One willing to overlook short-term performance with the belief that Yahoo is worth more to an acquirer," RBC Capital Markets analyst Jordan Rohan said in a telephone interview.

So when Yahoo reports third-quarter results tomorrow, investors are likely to look past the numbers to see if Yang has made any hard decisions during the last 100 days.

This partly reflects the easy bar analysts believe Yahoo set for results this quarter, amid ongoing web search market share losses to Google. But there is also concern the crown jewel of its ad business - banner display sales to brand advertisers - has deteriorated recently and faces further challenges ahead.

"We can't see in any of the outside metrics where Yahoo is making any headway in turning around its core businesses," Bernstein analyst Jeffrey Lindsay said in a phone interview.

Analysts expect Yahoo revenue to grow 10 per cent to $1.24 billion ($NZ1.57bn) from a year ago, while earnings are expected to slide around 28 per cent to 8 cents a share, on average, according to Reuters Estimates.

Google is expected to report later this week that it grew five times faster than Yahoo in that period.

A low bar

"This is the lowest bar that a major internet company has ever set given all the positive news coming from elsewhere in the sector," Rohan said, referring to Yahoo.

Goldman Sachs analyst Anthony Noto advises investors to stay out.

"We believe that the stock may still be a value trap given that there is meaningful risk to our current 2008 estimates and beyond given the ongoing strategic review and the dynamic industry trends," Noto wrote to investors on Thursday.

Bernstein's Lindsay says that, in the battle with Google's automation of web search advertising, Yahoo's focus on brand advertising sold by humans cannot keep pace in either expenses or margins with Google's largely computerised system.

His solution: Further automation of Yahoo's ad sales and to reduce the company's total head count by a sharp 25 per cent.

"In the internet's first decade, ads were sold as they have always been, by sales force over a round of golf," Lindsay wrote earlier this week. "Google changed all that with ... self-service."

Lindsay fears Yahoo is losing valuable time in the market by not making tough decisions to outsource search to Google, cut jobs and move more quickly to automate brand ad sales.

He calculates Yahoo is worth $39 per share if it was broken up and sold in parts, well above its combined value now of $25. If it took the more radical steps he has proposed, the break-up value could shoot up to $45, Lindsay believes.

Yahoo shares traded up 3 per cent at $28.50 in Nasdaq trading on Friday afternoon.

"We think an incremental strategy is not only risky, but virtually guarantees that Yahoo will remain mired in mediocrity - where the best hope is a take-out by a deep-pocketed partner," Lindsay said.

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Yahoo And eBay Team Up To Fight Plishing

Eric Auchard

Yahoo is working with auction leader eBay and its PayPal payments unit to block fake emails to users purporting to be from eBay and PayPal, hoping to spur on an industry that has been slow to fight the scourge of so-called phishing attacks.

EBay and PayPal have upgraded their computer systems to support an emerging technology standard known as DomainKeys invented by Yahoo that authenticates email senders are who they say they are, allowing Yahoo to block fake emails.

The technology upgrade will be made available to Yahoo Mail users worldwide over the next several weeks, the company said.

"It is a big step forward for consumers in defence against the bad guys," John Kremer, vice president of Yahoo Mail, said in a phone interview.

Along with banks and pharmaceutical makers, eBay and PayPal are among the brands most targeted by phishers seeking to trick consumers into divulging personal information such as credit card or password data in order to commit financial fraud.

Over the past decade, phishing has been clogging the inboxes of email users worldwide with ever more sophisticated attempts to fool users into clicking on fraudulent sites or giving up personal financial details to commit fraud.

But to date, many of the defences put forward by security software vendors and industry consortiums have failed to take hold with email senders due to their complexity or costliness, or political in-fighting over standards, leaving individual consumers always guessing which email may be real or fake.

A PayPal official said Yahoo's system provides a way of automatically detecting potential phishing attacks without relying on the consumer to do anything new.

"If the consumer doesn't receive an email in their inbox then it is very hard for the phisher to victimize them," Michael Barrett, PayPal's chief information security officer.

Fear of blocking legitimate mail

Two camps have emerged among technology providers seeking to develop a coherent approach to identifying email senders.

One backed by Yahoo and Cisco Systems along with AOL, Google, IBM, Sendmail and VeriSign is the DomainKeys Identified Mail (DKIM) technology, which allows email providers to identify the web domain from which a sender has sent email.

A second standard known as Sender Policy Network (SPF) has been led by Microsoft, which offers its own version of SPF known as Sender ID. SPF-based protections are used by Amazon, AOL, GoDaddy and eBay, which supports both DKIM and SPF.

Chenxi Wang, a security analyst with Forrester Research, said DomainKeys relies on more sophisticated cryptography than the Microsoft-supported approach. This sophistication can make DomainKeys harder for websites to install but offers greater long-term defence against phishing attacks, she said.

So far, most customers have installed sender authentication inside their email systems as a monitoring tool but do not block email for fear of false positives - mistakenly treating legitimate customer email messages as phishing attempts.

However, despite the industry disagreements, an underlying consensus is emerging among software vendors, internet service providers and corporate websites that digital email signing in one form or another is the best shot to combat phishing.

"Two years ago if you asked companies whether they were using email authentication, most people wouldn't have cared," Wang said. "Today if you ask most organisations if they think it is a good thing people would say, 'Yes."'

"The industry is slowly coming around," Wang said. "EBay and PayPal are some of the first to actively block unauthenticated emails."

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Yahoo China & MSN China Sign Code Of Conduct Agreement With Chinese Govt

Yahoo China and MSN China confirmed Friday they had signed a code of conduct for their blogging operations that committed them to protecting the interests of the Chinese state.

The firms and other blog providers in China this week signed the "self-discipline" pact, under which they pledged to "safeguard state and public interests," according to a statement from the China Internet Society.

The pact "encourages" Internet firms to register the real names, addresses and other personal details of the bloggers, and then keep this information.

The firms also committed to delete any "illegal or bad messages," according to a copy of the pact posted on the society's website.

Along with sex and violence, China's communist rulers have also deemed that opinions critical of it or the spreading of democratic ideology are not allowed.

Yahoo China and MSN China told AFP they had signed the pact, but did not give any further comment.

"I can confirm that we signed the pact this week," said spokesman Dou Xiaohan of Yahoo China.

MSN China spokesman Feng Jinhu said: "We've signed the pact but there is no press release on that."

Some Internet companies have caused uproar abroad for bowing to the Chinese government's demands by agreeing to censor websites and content banned by the nation's propaganda chiefs.

They have repeatedly insisted that they have no choice but to follow local rules and regulations in China.

Yahoo has been criticised for passing on information to Chinese authorities about one its users, who got a 10-year jail sentence for divulging state secrets.

The user had posted a Chinese government order, forbidding media organisations from marking the anniversary of the 1989 Tiananmen Square uprising, on the Internet.

International press freedom group Reporters Without Borders condemned the new blogging pact.

"The Chinese government has yet again forced Internet sector companies to cooperate on sensitive issues. In this case blogger registration and blog content," it said in a statement.

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MySpace Now Reports News As It Happens

Following the rumors last month that MySpace was getting into the news aggregation game, MySpace News has now gone live. Built on technology developed by Newroo (which News Corp. acquired last year), MySpace news combines the aggregation functionality of Google News, with user voting similar to Digg.

From London's Times newspaper (which is also owned by News Corp.):

MySpace is going into the news business with a service that will scour the internet for news stories and let users vote on which ones receive the most exposure.

This approach blends elements of Google News and sites such as Digg and Netscape, which rely on readers to submit stories and determine their prominence.

Despite speculation to the contrary, MySpace News won't favor News Corp-owned content, and, according to the site's FAQs page, news outlets will be able to opt-out — presumably to avoid being sued, as has happened to Google News — and that sites that aren't currently featured (including blogs) can apply to be included.

As I've said previously, it's clear that with MySpace News (and previous efforts around video), News Corp. wants to make the social network a one-stop-shop, with no reason for users to go elsewhere.

MySpace is fast becoming a portal 2.0 in disguise.

Also from the Times:

It also marks the site’s ambitions to become a web portal like Yahoo!, providing its users with a front door to the internet.

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Yahoo Sued For Giving User Information To Chinese Government

The wife of a Yahoo user jailed in China for promoting democracy online is suing the Internet search engine company for helping Chinese officials track him down and convict him.

A suit filed in federal court in San Francisco on Wednesday by the wife of Wang Xiaoning accuses Yahoo of "aiding and abetting" torture and human rights violations by linking her husband and others to email and online comments.

Yahoo was referred to 10 times in the Chinese court verdict on September 12, 2003 that declared Wang guilty of "incitement to subvert state power" and sentenced him to a decade in prison.

"I feel very angry," Wang's wife, Yu Ling, said after a news conference on Thursday announcing the filing of the suit.

"Yahoo betrayed my husband for their business interests. They literally destroyed my family. All my husband did was express his political views."

The suit filed under the auspices of the US Alien Tort Statute and the Torture Victim Protection Act names Chinese Internet search engine Alibaba as a defendant along with Yahoo's operations in China and Hong Kong.

The suit calls on the court to order Yahoo to stop cooperating with requests by China to identify Internet users and to pressure the government there to release Wang and others imprisoned as the result of such shared information.

Wang is also demanding cash damages to be determined at trial, according to her lead attorney, Morton Sklar of the World Organization for Human Rights.

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Sandisk Player To Download Songs From Yahoo's Service

Flash memory maker Sandisk Corp. said on Monday that Yahoo Inc. would provide music services for its Sansa Connect digital audio player.

Sansa Connect lets users listen to typical MP3 songs, but also has a built-in Wi-Fi wireless communication connection, allowing users to download songs from Yahoo's service without first linking to a personal computer.

The agreement, whose terms were not disclosed, pairs the Sansa Connect with both free and subscription-based services from Yahoo's Yahoo Music service.

The device, first introduced in January, is now available for sale in the United States, according to Sandisk, which says it is the No. 2 seller in the U.S. of MP3 players, behind Apple Inc.

Hoping to lure shoppers looking for an alternative to Apple's ubiquitous iPod, Sandisk has won over many consumers with its sleek Sansa line of digital players. But like rival consumer electronics makers Samsung Electronics Co. Ltd. <005930.ks> and Sony Corp. <6758.t>, the company has found it hard to gain ground against the iPod.

Apple has sold more than 70 million iPods since the product's introduction in October 2001, and the devices now command more than a 70 percent share of the U.S. market for MP3 players, as they are also known.

Sandisk's new device, which was among several announced at the Consumer Electronics Show in January, comes as Sandisk's profit and shares are under pressure from steep declines in flash memory prices for gadgets like cell phones and digital cameras.

The device is expected to sell for about $250 and will be available in Canada in the latter part of 2007.

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Google Increasing Gmail Storage To Infinity Plus One Soon

Google announced today that soon customers of their Gmail service will have their storage size increased to "infinity plus one." The announcement comes shortly after Yahoo's announcement that their Yahoo mail customers would be given unlimited storage.

Greg Tomkins, an engineer at Google, is credited with coming up with the "infinity plus one" idea. "I was out in the yard when my kids ran up to me yelling at each other. My son said to my daughter, 'I hate you to infinity.' She replied, 'I hate you to infinity plus one.' And right then I knew I had the solution to competing with unlimited storage," said Tomkins.

He continued saying that his son's idea about putting "dragons and Pokémon" on the Gmail pages didn't go over as well with management.

Tomkins also said that they would be using new RAID technologies which allow them to store copies of e-mail in parallel universes. This means that if their servers crash they will be able to recover your data from another universe where they haven't.

"Once your Yahoo e-mail box is full, you'll be able to transfer it to Gmail and add one more message," said Tomkins. "Those Yahoos will have a hard time beating that."

When contacted about the Google announcement, a Yahoo representative said, "We will be making an announcement shortly about our million-trillion-billion infinity storage," and added, "Neener, neener, neener."

Not to be left out of the storage bonanza, a Hotmail representative said that while they "can't offer unlimited storage, they can delete all your e-mail at random intervals in conjunction with their Live OneCare service, to make sure you never run out of space."

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