MySpace and Skype to Announce Partnership

New York Times ( October 17, 2007)

SAN FRANCISCO, Oct. 16 — In a deal that will connect two of the largest Internet services, MySpace, the social network owned by the News Corporation, will announce on Wednesday that it is teaming up with Skype, the Internet telephone service owned by eBay. In November, MySpace will add the Skype features and brand to its instant-messenger software, which allows MySpace users to conduct text chats with each other. MySpace users who download the newest version of that software will also be able to make free calls from their computers to each other, and to anyone else on the Skype network. “We are interconnecting the world’s largest voice network and the world’s largest video and social network,” said Michael van Swaaij, interim chief executive of Skype. “It feels like an obvious fit.” The companies hope that the combination will accelerate the growth of two already robust online networks. MySpace has 110 million active users around the world, but its members are mostly concentrated in the United States. Skype has 220 million users, most of them outside of this country. There is little overlap, particularly in the United States, where, according to Nielsen NetRatings, only 6.7 percent of Skype users are also users of MySpace’s instant-messenger software. The two companies say they will split the revenue when MySpace members use Skype’s pay features, like voice mail boxes and calling to and from Skype accounts and regular landlines and mobile phones. They have not disclosed the exact ratio of that split. The deal could be beneficial to both companies. MySpace’s instant- messenger software, used by about 25 million people, trails rival services from AOL, Yahoo and Microsoft in popularity and features. Those services already let people make voice calls in addition to conducting text chats. MySpace says the Skype deal helps it catch up. The partnership gives Skype increased exposure at a difficult time. EBay recently acknowledged that it overpaid by more than a billion dollars in its $3.1 billion acquisition of Skype in 2005.

Logistics costs eating into firms' revenues

Logistics costs eating into firms' revenues
Bangkok Post (17 October 2007)

Thai companies should work harder to minimise logistics costs increase profits in the long term, said experts. The profitability of Thai companies was falling due to higher fuel prices and tougher competition among business operators, said Assoc Prof Ruth Banomyong, the director of Thammasat University's logistics research programme. As well, he said, the local economy is projected to grow slowly, so business opportunities would be limited. Economic expansion is forecast at between 3.5% and 4% this year and only slightly higher next year. ''Private companies should turn to focus on managing logistics as it will be able to help them reduce operation costs and eventually increase profits as well,'' he told a seminar yesterday. In today's highly competitive market, the pressure on organisations to find new ways to create and deliver value to customers has grown even stronger. Logistics can help achieve cost reduction and service enhancement. Last year, Thailand saw logistics costs ate as much as 23.9% of the country's gross domestic product (GDP), up from 19.4% in 2005. The upward trend would continue, experts said. Chakkaphant Manutsathit, chairman of the board of Team Precision Plc, said his electronic parts production business needed good logistics management as the company was required to deal with many suppliers and deliver finished goods to different customers. ''If we can't manage our logistics well and the product delivery is not on time, that means the business will be damaged. We are forced to manage production costs and times at the same time, and the key to success is to link all information in the production and logistics chain and mange it properly,'' he said. Mr Chakkaphant noted that Thai companies, especially exporters, could not escape the negative effects from the strong baht so they should find new ways to offset this, including reducing costs, increasing production capacity, managing logistics and exploring new markets. Thai Ha Plc, a producer of packaged jasmine rice and soybean and glass noodles under the Kaset brand, said it had already raised glass noodle prices by 10% from 900 baht per package as it could not shoulder rising costs. ''We'll try to maintain prices of other products until the year-end even though our production costs have risen by 20-30%,'' a company executive said. ''We still have enough inventories carried from the second quarter.'' The company's total revenues would be between 1.45 billion and 1.5 billion baht this year, up from 1.23 billion last year, as exports have been growing. However, the company said that local sales offered higher gross product margins than exports.

Sub-prime woes may derail Phillip target

Sub-prime woes may derail Phillip target
Bangkok Post (17 October 2007)

Phillip Asset Management Co (PAMC) expects that its assets under management will slightly miss its target of 500 million baht by the end of this year due to the impact from the US sub-prime crisis. The newly established asset manager set a high hope on the launch of its first foreign investment fund, which was expected to boost the assets close to its projection. Vattana Vongseenin, the company's CEO, said the assets under management were very small because when it introduced the first two mutual funds, the Phillip long-term equity fund (P-LTF) and Phillip money market fund (PCASH), investors' sentiment was clouded by the US sub-prime mortgage problems. PAMC could raise only seven million baht from P-LTF and 63 million baht from PCASH. Currently, its total assets stood at 70 million baht. ''The timing for the launches of our first two funds was bad, as investors were not interested in making any new investments at the time. Anyway, the new FIF will help us increase assets by another 350 million baht,'' Mr Vattana said yesterday. The company is now opening the subscription of its Phillip Asia Pacific Fund (PAP) until Oct 31. The FIF will invest in Phillip Asia Pacific Growth Fund managed by Phillip Capital Management (S) Ltd in Singapore. The master fund, with assets totalling S$21.21 million, has invested over 90% of its portfolio into North Asian and Asean stocks and the balance in debt instruments in Asia Pacific. It could generate a 21.2% return for the past 12 months. Of the total assets, 15.7% were in Malaysia, 14.4% in Singapore, 13% in Hong Kong and China, 12.9% in Japan and 7.3% in Thailand. Jeffrey Lee, chief investment officer of PhillipCapital Management in Singapore, said Taiwan, Indonesia, Thailand and Japan had a lot of upside potential over the next 12 months. ''Asia is the world's fastest-growing area. Several emerging Asian markets are booming on the back of local consumption and infrastructure investments. When the US economy is slowing down, many countries have been less affected,'' he said. Recently, many Asian countries have reduced their dependence on exports to the US by increasing exports to other Asian countries, especially China and India, which import a lot of commodities, including oil and coal, as well as food such as prawns and chicken. Mr Lee predicted that foreign funds would continue to flow into Asia after the US Federal Reserve has cut its fed fund rate. Commenting on the Thai stock market, he said PhillipCapital was bullish on the country. Thai shares have the most affordable valuations, given its price-to-earnings ratio of 12-13 times and dividend yields above 4%. ''Even though the coup took place last September, Thai corporate earnings have still grown. In my opinion, it is a great timing to invest in stocks after the coup. Some foreign fund managers may want sit on the sidelines until everything clears up. But it will be too late, as prices will no longer be cheap,'' he said. PhillipCapital saw this great opportunity and introduced a Thailand fund worth US$50 million to attract Japanese investors since early this year. The fund has yielded more than 35% to date. ''We will increase our weighting in Thailand and invest more soon. The political situation will improve after the election and the forming of a new government and some policies will be imposed to boost economic activities for sure,'' Mr Lee said.

Advanced M-Pay shifts strategy

Advanced M-Pay shifts strategy
Bangkok Post (17 October 2007)

Expands services in bid to turn profitAdvanced M-Pay Co, the mobile payment arm of AIS, is penetrating the online community and making inroads into the high-margin international direct dialing (IDD) services in an effort to turn a profit in 2008 for the first time ever. The 70:30 joint venture firm between the local cellular market leader Advanced Info Service and Japan's NTT DoCoMo expects the strategic shift to improve its performance by 30% next year in terms of transaction volume and value, revenue and profit. Managing director Waroonthep Watcharaporn said Advanced M-Pay expected to increase the number of active M-Pay users from 600,000 now to one million by the end of 2008. Transaction volume should rise from 35 million to 45 million transactions for a value of 2.6 billion baht, he said. The company would post a profit on expected revenue of 175 million baht next year. Advanced M-Pay has invested 300 million baht in equipment and software. Mr Waroonthep said the company was stepping up promotions of mobile payments as the second M-Pay flagship service line in 2008 under the theme ''Your mobile, Your wallet''. ''We are working closely with AIS to allow our prepaid customers to make overseas calls via their mobile handsets through M-Pay,'' he said. Advanced M-Pay has posted losses since its inception in August 2005. Mr Waroonthep attributed the losses to a lack of confidence in mobile payment security, less marketing and the razor-thin margins of M-Pay services, dominated by small transaction fees for topping up refill cards. Advanced M-Pay expects to register 35 million transactions this year, 90% of which would be One-2-Call prepaid customers refilling accounts through 40,000 M-agent vendors. The remainder involved bill payments and purchases through vending machines. In 2006, the company had only about 100,000 transactions for 10 million baht. Mr Waroonthep said the company was shifting its focus from One-2-Call customers to internet users and the existing one million AIS non-voice customers. The company is in talks with several commercial banks to provide mobile ATM services. The service would enable customers to pay bills for credit cards and conduct financial transactions through handsets. AIS now allows customers to pay water and electricity bills through their handsets. It will allow GSM postpaid customers to pay bills through M-Pay over the next two months. The company is also on the verge of developing Java software to improve the user interface. ''We expect the proportion of transaction volume between end users and customers conducting financial transactions through M-agent at 40:60 next year, compared with 10:90 currently,'' he said. Mr Waroonthep said the company was also preparing to introduce a shopping website, providing auctions and a variety of trendy products such as iPhone mobile handsets and Harry Potter books. Customers will need to pay for the products they buy online through the M-Pay service. The web is aimed at creating an online community to promote M-Pay. The country's mobile payment market would explode once near-field communications technology takes hold in the Thai market, expected over the next two years, Mr Waroonthep said. With the technology, customers could use mobile phones to pay for transport fees, including the skytrain and s

Govt auctions dominate

Govt auctions dominate
The Nation (17 October 2007)

Thai business must lift its act, experts warn

Government electronic auctions represented the biggest portion of e-commerce revenue in Thai-land last year, a National Statistical Office (NSO) survey assessing the e-commerce industry showed. Yesterday's release of the survey's results came with a warning that Thailand would be left behind by its global competitors if it did not hurry to improve both logistics and payment infrastructure, in order to boost the nation's e-commerce. E-commerce transactions in Thailand last year were worth more than Bt305 billion. Of that, about Bt177.9 billion, or 57.9 per cent, came from government electronic auctions. However, in terms of number of transactions, 85.3 per cent of e-commerce transactions were business-to-business deals, 14.4 per cent were business to consumer and only 0.3 per cent were business to government. The top five e-commerce industries were textiles, tourism, computers, electronic appliances and automobiles. Most e-commerce businesses used e-commerce and a website as online marketing channels to promote products and services and allow customers to keep in touch. The front-end services they provided included personal identification, trust marks or credit checks and purchase guarantees for products and services. About 58 per cent of e-commerce businesses created a privacy policy and statement, using TRUSTe, BBB Online or certification-authentication services. The NSO found that even though the number of e-commerce transactions had increased, most e-commerce payments were still made off line (36.7 per cent), while about 28.3 per cent use both off- and online payment systems. Only 6.7 per cent of payers have adopted and rely on online payments. Offline payments include cash transfers through bank accounts, payment on delivery and pay at post. Online payments include electronic banking and payment via ATM, credit card, mobile phone and electronic data-interchange system. The report indicated that Thailand's e-commerce industry was developing slowly and still had much room to grow. Thai E-Commerce Association president Sahas Treetipbut said Thailand's e-commerce value was expected to grow more than 20 per cent this year. This would result from several positive factors, including more Internet users, especially broadband users, more e-commerce businesses, more products and services, the launch of the Computer Crime Act, more convenient electronic payment methods and infrastructure, greater awareness among Thais and increased online activities. Business Development Department director general Kanissorn Navanugraha said e-commerce in Thailand had much room to grow. However, two major weaknesses - logistics and payment infrastructure - needed to be improved. The present cost of logistics in Thailand is higher than that in most other countries - about 20 per cent versus 5 per cent - and that is an obstacle to the growth and development of the local e-commerce industry, he said. Also, payment infrastructure in Thailand needs improve-ment, in order to build up customer confidence in online payments. "If Thailand does not move aggressively to develop e-commerce in industry, the country might suffer a loss of competitiveness in the global market, because many developed countries have already established themselves in this new era of commerce," Kanissorn said. To encourage many more e-commerce activities in the Kingdom, the department recently launched an online e-commerce curriculum for Thai businesses. The department hopes to double the number of e-commerce businesses from about 6,000 at present to 12,000 in the next three years rather than letting it grow naturally at 20 per cent per year. Last year, out of 827,051 companies, only 30,000-40,000 had their own websites and only 6,000 could be identified as e-commerce businesses. That meant only 0.8 per cent of Thai businesses had adopted e-commerce as a marketing tool to enhance competitiveness, he said. "The obstacle to developing of e-commerce is that e-commerce is quite new for local businesses that are not familiar with the Internet and don't know how the Internet can become a crucial marketing tool," Kanissorn said.

Approval gets mixed reaction

Approval gets mixed reaction
The Nation (17 October 2007)

Small retailers hailed the Cabinet's approval yesterday of Thailand's first-ever Retail Business Act, hoping they will be entitled to a fairer environment in the retail industry, which has been dominated by giant players. The draft act won Cabinet endorsement yesterday, and Commerce Minister Krirk-krai Jirapaet said the draft would be submitted to the National Legislative Assembly (NLA) for reading next Monday, as this government wanted to enact the law before the end of its term. The Cabinet yesterday also approved a Bt59-billion investment budget for the Red Line subway route, which will run 26 kilometres from Rangsit to Bang Sue. Internal Trade Department director-general Yangyong Phuangrach said the Retail Business Act was meant to create a fair environment for both large and small retailers. The highlight of the law is that a large retailer will need to request a licence from the Commerce Ministry. Large retailers are defined by floor space and sales. They must cover at least 1,000 square metres, and minimum sales revenue must be Bt1 billion. This includes retailers whose consolidated sales - from different branches - exceed Bt1 billion. The retail industry will be governed by a committee chaired by the commerce minister. To accelerate the Act's implementation, the ministry will call for a meeting on the Retail Business Act this Friday with five NLA representatives, to determine further points for NLA discussion. Panthep Suleesatira, president the Federation of Thais Opposing Foreign Retailers, said small retailers welcomed the Cabinet's decision. "Thai small retailers are looking forward to the Act manipulating the retail industry, because an aggressive expansion of giant retailers hurts us. The NLA should approve the Act soon, so that it can be implemented before giant retailers hurt more small retailers," he said. Tesco Lotus, the largest retailer, yesterday said it was ready to comply with the new Act even though tightened regulations would affect both retail operators and consumers. "As a business operator, we have every intention to comply fully with all laws and regulations," said Darmp Sukontasap, senior vice president of Ek-Chai Distribution, operator of Tesco Lotus. "However, the government should issue laws and regulations based on verifiable information and reliable research or studies, taking into account the long-term interest of the country." He said the company did not mind if the government considered it appropriate to have a law governing retail and wholesale businesses. The law should foster fair practices for everyone, and the roles and responsibilities of all concerned should be clearly defined for suppliers, wholesalers, modern retailers and mom-and-pop shops. The law should be transparent and apply equally to everyone. Darmp pointed out that consumers would be affected most by the new law, which would restrict their right to choose and limit the alternatives available to them. The government and the NLA should ensure that the law will serve the interests of consumers and not those of large suppliers and their wholesale network, he said.
Darmp said since the retail and wholesale sectors accounted for more than 18 per cent of Thailand's gross domestic product and were directly linked to inflation and the cost of living, the government and the NLA should consider what long-term effects the law would have on the Kingdom's overall economy.
"We hope all of these considerations will be discussed in the NLA when its members deliberate the draft law," he said.
He added that even at this stage, he still could not see how the law as drafted would benefit both mom-and-pop shops and consumers, even though claims have been made all along that both groups would benefit.

Duty-free bid for six exports

Duty-free bid for six exports
The Nation (17 October 2007)

Thailand will seek United States generalised system of preferences duty-free entry for six items, the Foreign Trade Department said.

The items are televisions, plastic pellets, plastic packaging, aluminium tableware, canned longan and lychees and microwave ovens. Department director-general Apiradi Tantraporn said yesterday it would ask the US Trade Representative to reinstate privileges for the items at its annual review. Duty-free entry helps boost exports, he said. Exports covered by the privileges cannot exceed US$130 million (Bt4.4 billion) a year or command more than 50 per cent of US imports of those goods.

Cabinet backs electronic sales
The Cabinet yesterday approved Finance Ministry recommendations to allow greater flexibility for electronic auctions for projects worth no more than Bt10 million. Government agencies or state enterprises may or may not set up committees to draft terms of reference for projects if standard terms are available. These must be publicised on that agency's website. They can appoint three committee members to organise auctions. If no bidder or a single bidder participates, alternative methods will be required.

Civil servants' exit package
The Cabinet approved compensation levels for civil servants who leave work before retirement age. Those taking early retirement will receive no more than 15 months' salary at the rate at retirement. Payments can be calculated by adding eight years to the worker's remaining years until retirement. Professional compensations are included. The payments will be made from the 2009 fiscal year until 2013. Workers must be at least 50 years old or have worked in government for 25 years. Officials considered top performers are not eligible.

Warning over rising prices
The Commerce Ministry is concerned over rising prices of consumer goods and has warned it will prosecute those illegally increasing them or stockpiling goods to mislead the market. Permanent secretary Siripol Yodmuangcharoen yesterday asked the Internal Trade Department to monitor prices and stocks during the current period of oil-price hikes. "The ministry will not approve any product-price increases in the meantime. If the ministry finds traders or manufacturers increasing prices without permission, or stockpiling goods, they will be prosecuted," he said. Offences carry a maximum penalty of seven years jail and/or a Bt140,000 fine.

Science park to open in 2010
The National Science and Technology Agency said the second phase of the National Science Park would cost Bt2 billion. The park is open to private research-and-development companies.
The 72,000-square-metre park is near Thammasat University's Rangsit campus and construction is expected to commence later this month. It should open in 2010.

Foreign direct investment in Asia continues to rise

Foreign direct investment in Asia continues to rise
The Nation (17 October 2007)

Inflows to Thailand increase 9% to reach record US$10 billion. Foreign direct investment (FDI) inflows to South, East and Southeast Asia maintained their upward trend last year, rising by 19 per cent to reach a new high of US$200 billion (Bt6.83 trillion), according to the United Nations Conference on Trade and Development (Unctad) annual report on global investment trends. South and Southeast Asia saw a sustainable increase in FDI flows, while growth in East Asia was slower. However, FDI in East Asia is shifting towards more knowledge-intensive and high value-added activities, Unctad economist Kee Swee Wee said yesterday. China and Hong Kong retained their positions as the largest FDI recipients in the region, followed by Singapore and India, according to the World Investment Report 2007. Inflows to China fell 4 per cent to $69 billion last year, dropping for the first time in seven years due mainly to declining investments in financial services. Hong Kong attracted FDI of $43 billion, Singapore $24 billion and India $17 billion, which was equivalent to India's preceding three years of inflows. Meanwhile, FDI inflows to Thailand rose by 9 per cent in 2006, reaching a record of $10 billion and consolidating the country's position as the second-largest FDI recipient in Southeast Asia. The acquisition of Shin Corp by Singapore's Temasek Holdings accounted for a large part of the Kingdom's FDI inflows. FDI in the service sector in the region was considerably increased but FDI related to mergers and acquisitions in manufacturing dropped. The report predicts that rapid economic growth in this region should continue attracting FDI to their countries in the coming year. In the first half of this year, the value of cross-border merger and acquisition deals in the region rose nearly 20 per cent on year. FDI outflows from the region are also expected to increase. The report also showed that rising demand for oil and gas and metals, particularly from Asia, has spurred an FDI boom in mineral exploration and extraction industries. Those industries account largely for the recent increases in FDI in many mineral-rich developing countries, notably in Africa. The boom has also triggered a series of cross-border mega-mergers in these industries, resulting in higher market concentration, said Masato Abe, an economic affairs officer with the UN Economic and Social Commission for Asia and the Pacific. The report shows that the relative importance of transnational corporations (TNCs) varies between different extractive industries. In metal mining, 23 of the top 25 producers in 2005 were privately owned TNCs, whereas only two were majority-owned by the state. In oil and gas, the majority of the top 50 producers were majority state-owned. Mostly such production was controlled by state-owned companies from developing and transition economies. For example, in 2005, the production of Saudi Arabia was more than twice that of the world's largest privately owned oil and gas producer, ExxonMobil. Investment in extractive industries makes up the bulk of inward FDI in low-income countries. Due to small domestic markets and weak production capabilities, these countries tend to have few other industries to attract significant FDI. Therefore, a large share of their national incomes is generated by revenues from mineral exploitation and exports. Unctad argues that the commodities boom should provide opportunities for development and poverty alleviation in mineral-exporting countries. But considerable efforts to address the economic, environmental, social and political issues relating to mineral extraction are necessary for harnessing the earnings from extractive industries to boost development. TNCs can influence the outcome. They may contribute capital, technology and management skills, and when domestic capabilities are lacking, such an approach is often the most viable option for exploiting natural resources. In South, East and Southeast Asia, the value of cross-border mergers and acquisitions in extractive industries rose nearly fivefold to $1.7 billion.

SET panel tackles listing rules

SET panel tackles listing rules
The Nation (17 October 2007)

The Stock Exchange of Thailand (SET) has formed a working group to conduct a study to amend listing criteria as part of efforts to raise the number of companies on the bourse. Among the members of the working group are representatives from the Thai Listed Companies Association, the Thai Investors' Association, the SET and the Market for Alternative Investment, SET president Patareeya Benjapholchai told reporters yesterday. Former SET president Seri Chintanaseri serves as an adviser to the working group, she said. The working group will take charge of revising regulations governing the supervision of listed companies, in order to address current circumstances and attract non-listed companies. Information disclosure will remain the main issue of the regulations to be revised, she said. The working group's term runs from Monday of this week to December 31. Its establishment came after less than 10 companies debuted on both stock exchanges so far this year. In July and August, the SET conducted a survey on the satisfaction of 167 listed companies and found 68 per cent considered the current regulations suitable. They suggested some regulations could be adjusted to align with the current situation, such as information disclosure relating to connected transactions, Patareeya said. They also suggested the SET reduce overlapping among stock regulators, said Patareeya.
Of the respondents, 46.3 per cent were staff of listed companies, 42.5 per cent executives and the rest managing directors, presidents and directors. Of the surveyed firms, 41.5 per cent had market capitalisation of less than Bt1 billion, 44.5 per cent between Bt1 billion and Bt10 billion and the rest more than Bt10 billion. Patareeya said 77-80 per cent of respondents were satisfied with advice and services from SET officials and agreed the SET arranged activities that educated listed companies. The SET will forward the survey results to the working group, she said.

Advanced M-Pay eyes 30% transactions leap

Advanced M-Pay eyes 30% transactions leap
The Nation (17 October 2007)

Financial transactions made via mobile telephone using Advanced M-Pay are expected to increase 30 per cent next year, the company said. As well as transaction volume, their value and revenue for the company should each rise 30 per cent, too, it said. Advanced M-Pay is a 70:30 joint venture between local cellular giant Advanced Info Service and NTT DoCoMo of Japan. It has capital of Bt300 million. Customers can directly pay bills for utilities and credit cards and other goods and services using their handsets as debit cards. The company charges a fee per transaction. Managing director Waroonthep Watcharaporn said yesterday that total revenue this year would be Bt135 million. Transactions will reach 35 million and revenue from them will be Bt2 billion, he said. In just two years, M-Pay has attracted 1.3 million registered subscribers and 800,000 have been active in the past six months. Waroonthep said active users would reach one million next year. M-Pay customers can ask 40,000 company agents nationwide to make transactions for them, or do so themselves. Waroonthep said most subscribers felt more comfortable with agents processing their transactions. M-Pay hopes four in every 10 users will be making all their transactions by themselves next year. Most users limit their transactions to paying for services within the AIS group, such as refilling prepaid phone accounts. It will spend Bt25 million promoting its range of services next year, down from Bt30 million this year.

Microsoft Raises Voice in Business Communications

The Wall Street Journal (17 October 2007)

Microsoft Corp. laid out new software and a strategy that could shake up the already tumultuous telecommunications-equipment business. The Redmond, Wash., company demonstrated Office Communications Server 2007, the software centerpiece to a multiyear effort to reshape business communications. The Microsoft OCS software runs on large server systems and allows a person using Microsoft's Office software to manage voice calling from their PC and in combination with email, instant messaging and other communications. The software can allow a user with a headset to make a phone call from a PC, by clicking on a name in a contact list. But it includes far more advanced features, such as being able to add people to a conference call by using a mouse to drag and drop their name across the computer screen. Such capabilities, which Microsoft and others call "unified communications," are "going to be as profound as the shift from typewriters to word-processing software," said Chairman Bill Gates. Microsoft is also shipping PC software that works with OCS called Office Communicator 2007 and a new version of its video-conferencing software. It is also selling a $3,000 device called RoundTable that can capture in a panoramic view video-conferencing participants sitting around a table. Phones in businesses and the complex systems behind them have long been supplied by equipment makers far removed from the PC-software businesses that have been Microsoft's lifeblood. Now as Internet technologies become more prevalent in telecommunications, they are opening an opportunity to handle voice calling through the current tool for accessing the Internet: the PC. As the world's largest maker of PC software, Microsoft wants to own that emerging market. The Microsoft software is controversial because it breaks down traditional barriers between the PC-software business and telecommunications vendors that have long controlled the lucrative business of building phones and computers called PBXs, or private branch exchanges, which handle businesses' phone systems. Microsoft is trying to woo those vendors as partners and said that Sweden's Telefon AB L.M. Ericsson and Canada's Mitel Networks Corp. will start making products to work with OCS. Those companies join Canada's Nortel Networks Corp., which last year said it would work with Microsoft on the software. But huge challenges remain. Internet equipment giant giant Cisco Systems Inc. is also building its own unified communications products and has been steadily winning customers to its networking gear for handling voice calls, which form the foundation for building more advanced voice-related software. Microsoft also faces the task of convincing potential buyers of software that its products are reliable enough for business use. While traditional telecom equipment is pricier than the Microsoft offerings, it is also reliable: businesses have little patience for dropped or lost calls or voice-mail messages. Larry Dusanic, operations director for Information Technology at Employers Insurance Group in Smithfield, N.C., said he wouldn't use the complete set of Microsoft software until he's assured it's reliable and won't drop calls. "I would like to wait until a few more versions are introduced before I seriously implement a complete system," Mr. Dusanic said. "I want to wait until it matures." Microsoft built the software to work with its already widely used products such as its email software Microsoft Exchange, so the company is betting that those customers will start experimenting with OCS and related voice software, executives said. A business on Microsoft's standard licensing program for large businesses would pay about $55 per PC to add the voice capabilities in OCS and its related software, according to Jeff Raikes, president of Microsoft's business division.

Google Testing YouTube Antipiracy System

Google's Video Identification antipiracy system for YouTube now in beta testing. Part 1 of a special five-part series. Juan Carlos Perez, IDG News Service (17 October 2007)

Google Inc. has unveiled a test version of a much-awaited antipiracy system for its wildly popular yet controversial YouTube video-sharing site. The system, called Video Identification, has been far from a secret. Google executives have been mentioning its development since the company acquired YouTube in November of last year. YouTube, which lets people upload and share clips, is the most popular video site, but some angry video owners have taken the company to court alleging copyright infringement. The best-known plaintiff is global media conglomerate Viacom, which sued Google in March for US$1 billion over the unauthorized uploading of video clips from its TV shows and movies. In its complaint, Viacom alleged that, as of March, almost 160,000 of its video clips had been uploaded to YouTube without permission and had been viewed over 1.5 billion times. The antipiracy system became news in July, when an attorney representing Google in the Viacom case said during a routine hearing that Video Identification would be ready by September. When describing the system, Google has consistently stressed that it will not block videos from being uploaded, but rather take action, if necessary, after they have been added to the YouTube site. In other words, Google has never planned to place uploaded videos in a holding queue while it checks whether they can be made available on YouTube. Instead, Google will match uploaded clips against a repository of legitimate videos provided by their owners using digital fingerprinting technology and will take whatever action the copyright owner has requested, such as removing the clip or leaving it up on YouTube. In designing the system in this manner, Google has maintained that its policies exceed the requirements of the Digital Millennium Copyright Act, as long as it removes from YouTube, upon request, illegally copied videos that owners don't want uploaded without their permission. That story didn't change on Monday, when Google described Video Identification in a blog posting and in a YouTube page. "Video Identification goes above and beyond our legal responsibilities. It will help copyright holders identify their works on YouTube, and choose what they want done with their videos: whether to block, promote, or even -- if a copyright holder chooses to license their content to appear on the site -- monetize their videos," David King, YouTube Product Manager, wrote in the blog post. For now, video owners interested in participating in the beta testing of the system need to submit a request to Google, but the company expects to make it broadly available as the testing progresses. "As we scale and refine our system, YouTube Video Identification will be available to all kinds of copyright holders all over the world, whether they want their content to appear on YouTube or not," the YouTube information page reads. It remains to be seen whether this highly anticipated system will help to appease those video content owners who argue that YouTube doesn't do enough to prevent and combat piracy on its site and that instead it profits from the unauthorized and illegal uploading of copyright clips.