Marissa Mayer #Yahoo's CEO

Here's some background on Yahoo's CEO

Marissa Mayer Biography - Business Insider

Illustration by Mike Nudelman/Photo by Fortune Live Media

On the morning of Thursday, July 12, 2012, Yahoo’s interim CEO, Ross Levinsohn, still believed he was going to be named permanent CEO of the company.

He had just one meeting to go.

That meeting was a board meeting to be held that day in a large conference room on the first floor of Yahoo’s Sunnyvale, Calif., headquarters. Yahoo called the room “Phish Food” — a funky room with lots of glass and white leather couches and chairs.

The agenda for the meeting: Levinsohn was going to brief the directors on his plan for Yahoo, should he be named permanent CEO.

Levinsohn walked into the room; all of his top executives followed.

There was Jim Heckman, Levinsohn’s top dealmaker, who’d spent months negotiating a huge deal with Microsoft. There was Shashi Seth, Yahoo’s top product management executive, already planning a long-needed update to Yahoo Mail and the Yahoo homepage. There was chief financial officer Tim Morse, who’d just completed a critical, company-saving deal to sell a portion of Yahoo subsidiary Alibaba. There was Mickie Rosen, a News Corp. veteran whom Levinsohn had hired to run Yahoo’s media business. And there was Mollie Spillman, whom he’d just made CMO.

Heckman, Seth, Morse, Rosen, Spillman, and handful of others sat off to the side.

Ross Levinsohn

All of them believed that the meeting was a formality — that Levinsohn was going to get the job.

They had good reason to be confident. For the two months prior, the chairman of Yahoo’s board, Fred Amoroso, had made it clear that he was going to do everything he could to make sure Levinsohn and his team would be running the company for the foreseeable future.

Amoroso told Levinsohn this in private. He told Yahoo employees this during an all-hands meeting in May. He’d even joined a sales call to express support for Levinsohn to Yahoo advertisers — an oddly hands-on move for a chairman.

In June, Amoroso helped Levinsohn recruit a high-profile Google executive named Michael Barrett into Yahoo. During the recruiting process, Amoroso promised Barrett that Levinsohn’s “interim” title was only temporary — that it was safe to leave Google.

Levinsohn had another reason to be hopeful: For the past few months, he’d been speaking with two of Yahoo’s most important new directors, Dan Loeb and Michael Wolf, almost every day. As important as it was for Levinsohn to have Amoroso’s support, he needed Loeb’s more. Loeb ran a hedge fund called Third Point, which owned more than 5 percent of Yahoo and had, only months before, forced the resignation of Yahoo’s previous CEO. Wolf was an important ally for Levinsohn to have, too. Wolf, a former president of MTV, was consulting for Third Point on media investments when Loeb asked him to join the Yahoo board and lead its search committee for a new CEO.

Levinsohn began his presentation. It was going to be a doozy, as he planned to seriously alter the direction of Yahoo.

He wanted it to stop competing with technology businesses like Google and Microsoft and focus entirely on competing with media and content businesses like Disney, Time Warner, and News Corporation. As part of this transition, Levinsohn wanted to spin off, sell, or shut down several Yahoo business units. He said doing so would reduce Yahoo’s head count by as many as 10,000 employees, and increase its earnings before taxes and interest by as much as 50 percent.

In fact, Levinsohn announced during his presentation that he and his team had already started down this road.

Levinsohn told the board that, under his direction, Heckman had begun negotiating a deal with Microsoft to exchange Yahoo’s search business for Microsoft’s portal, MSN.com, and large payments in cash. Levinsohn and Heckman had also been talking with Google executive Henrique De Castro about turning over some of Yahoo’s advertising inventory. There was also talk of unloading some of Yahoo’s enterprise-facing advertising-technology businesses into a joint venture involving New York-based ad tech startup AppNexus.


Heidi Gutman/CNBC

Dan Loeb controlled 5 percent of Yahoo and joined the board after a bloody proxy fight.

It was during this part of his presentation that Levinsohn began to feel the permanent Yahoo CEO job slipping away.

Others in the room got the same sinking feeling.

Wolf, the man in charge of the committee tasked with hiring a permanent CEO, began to question the wisdom of the deal.

Wolf asked, in a loud voice with a sharp tone, “I understand why this is good for Microsoft, but why is it good for Yahoo?”

Harry Wilson, another director brought onto the board by Loeb, joined Wolf in his criticism of the deal as “short-sighted.”

Their cross-examination of the deal eventually boiled down to one question: Had Levinsohn and Heckman made any irreversible commitments to either Microsoft or Google?

It was obvious to several people in the room that Wolf and Wilson wanted to make sure another candidate for the CEO job would not be forced to follow through on a deal they had not negotiated.

This was a bad sign for Levinsohn’s candidacy.

But Wilson and Wolf’s loud complaints about the Microsoft deal weren’t the worst sign for Levinsohn’s chances; Loeb’s behavior during the meeting was.

Loeb is the suited, slick, and handsome Wall Street type. He wears his salt-and-pepper hair short and messy on purpose. He’s actually from Southern California, and sometimes he puts off a surfer vibe.

During Levinsohn’s presentation, Loeb looked bored. He wasn’t paying full attention. As the interim CEO talked, Loeb stood at the back of the room and played with his BlackBerry.

One person in the room remembers watching Loeb texting for a while and then, “during the most important part of the presentation,” getting up and going to the bathroom for ten minutes.

This person remembers thinking: “Oh, OK. Sorry, Ross, you’re not CEO anymore.”

After the meeting, Barrett, the Google executive Amoroso had helped Levinsohn poach, called Levinsohn to ask how it went. Levinsohn told him he no longer felt like he was getting the job.

But who was?

That night, Levinsohn flew to Sun Valley, Idaho, where investment bank Allen & Co. holds an annual retreat for big-name media and technology executives.

Over the weekend, Levinsohn played a guessing game with venture capitalist Marc Andreessen, Square CEO Jack Dorsey, and Twitter CEO Dick Costolo. With each of them, Levinsohn and the other Silicon Valley bigwigs ran through a long list of names, trying to figure out who might be getting the job Levinsohn had so hoped for. For each name they came up with, they came up with a persuasive reason why that person could not be it.

Whom had Wolf and Loeb so clearly already decided on?

Finally, late Sunday night, Levinsohn got a call from a friend of his at Google.

This person asked: Had Levinsohn heard that Marissa Mayer had interviewed for the Yahoo job the Wednesday prior?

Levinsohn realized everything all at once.

Levinsohn now knew who Yahoo’s next CEO would be.

Soon, so would everyone else.

On Monday, July 16, four days after Levinsohn’s last board meeting, Yahoo made it official: Thirty-seven-year-old Marissa Mayer was Yahoo’s new CEO.

The board had indeed already made Mayer an offer by the time Levinsohn went into that final meeting to present his plan for Yahoo.

After the news broke in public, Levinsohn admitted to friends that he was disappointed. He had really wanted the job, and believed he would have done very well with it. He also felt bad for the team he put in place, who would now have to report to an unfamiliar leader.

But Levinsohn was also at peace. If he had to lose out to someone, at least he lost out to an icon.


Flickr/Fortune Live Media

Marissa Mayer

There is no one else in the world like Marissa Mayer.

Now 38 years old, she is a wife, a mother, an engineer, and the CEO of a 30-billion-dollar company. She is a woman in an industry dominated by men. In a world where corporations are expected to serve shareholders before anyone else, she is obsessed with putting the customer experience first.

Worth at least $300 million, she isn’t afraid to show off her wealth. Steve Jobs may have lived in a small, suburban home with an apple tree out front, but Marissa Mayer lives in the penthouse of San Francisco’s Four Seasons Hotel.

While rival CEOs like Mark Zuckerberg of Facebook and Larry Page of Google wear flip-flops, hoodies, and T-shirts, Mayer wears Oscar De La Renta on the red carpet.

Mayer calls herself a geek, but she doesn’t look the part. With her blonde hair, blue eyes, and glamorous style, she has Hollywood-actress good looks.

Young, powerful, rich, and brilliant, Mayer is a role model for millions of women. And yet, unlike Facebook’s chief operating officer, Sheryl Sandberg, Mayer resists calling herself a feminist. She even infuriated working mothers across the world when she banned Yahoo employees from working from home.

Widely admired by the public at large, Mayer has many enemies within her industry. They say she is robotic, stuck up, and absurd in her obsession with detail. They say her obsession with the user experience masks a disdain for the money-making side of the technology industry.

There is some truth to what they say.

And yet, a year after Mayer took over Yahoo, the company’s stock price was up 100 percent. Engineers wanted to work for Yahoo again. More importantly, so did sought-after startup CEOs like Tumblr founder David Karp, who agreed to sell his company to Yahoo for $1.1 billion.
Questions persist

Most CEOs of Mayer’s stature — people running multi-billion-dollar public companies the size of Yahoo — are gregarious, outgoing types — the kind of person who might have been a politician if the world of business and money hadn’t beckoned. Baby-kissers. Back-slappers. Schmoozers. Mayer is not that type. Peers from every stage of her life — from her early childhood days to her first year at Yahoo — say Mayer is a shy, socially awkward person.

How in the world has she overcome such a disadvantage to rise so far, so fast?

To a public casually interested in her career, Mayer’s career before Yahoo — spent entirely at Google — is remembered as one success after another. It wasn’t.

Mayer started off at Google spectacularly well, designing its homepage, creating its product management structure, and becoming the face of the company. She became one of the most powerful people at one of the world’s most powerful companies.

But then, suddenly, her peers were promoted past her. Responsibility for the look and feel of Google’s entire suite of consumer-facing products, including the Google homepage, was taken away from her. She was moved to a less important product: Google Maps. She was removed from a council of executives that met with Google’s CEO. To industry insiders, this sudden change was a demotion for Mayer. Was it actually? If it was, why did it happen? How did Mayer recover?

Mayer’s move to the top of Yahoo during the summer of 2012 was a shock for almost everyone — including the people who convinced her to do it. How did the board pull it off?

Then there’s the biggest question about Mayer: Can she save Yahoo?

Look up at the sky - Richard Branson on the picture taken by #Cassini of the #Earth and #Moon

the picture taken by #Cassini of the #Earth and #Moon

Look up at the sky

• By Richard Branson -
• Jul 24, 2013

Did you look up at the sky when all of us on Planet Earth had our photo taken from a billion miles away last week? Judging from the response online, it seems lots of you did.

Now Cassini have released the first images of Earth and its moon as tiny dots - Earth is the blue dot on the left; the moon is fainter on the right hand side.

Linda Spilker, Cassini project scientist, said: "Cassini's picture reminds us how tiny our home planet is in the vastness of space, but also testifies to the ingenuity of the citizens of this tiny planet to be able to send a robotic spacecraft so far away from home to take a picture of Earth and study a distant world like Saturn."

After urging people to go outside and stare at the sky while the photo was being taken, I particularly liked Martijn Scheffers reply on Facebook. "So I walked out, looked up, started smiling. After 2 seconds random bypassers declared me crazy. Why would a man gaze into the sky they said..."

I'm glad you looked up anyway Martijn. The better question is: why wouldn't you gaze up at the stars?
By Richard Branson. Founder of Virgin Group

Look up at the sky - Richard's Blog - Virgin.com

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Why Do Mosquitoes Bite Some People More Than Others? | Surprising Science

An estimated 20 percent of people are especially delicious for mosquitoes

Blood type, metabolism, exercise, shirt color and even drinking beer can make individuals especially delicious to mosquitoes:

• Just a single 12-ounce bottle of beer can make you more attractive to the insects, one study found 
• In several different studies, pregnant women have been found to attract roughly twice as many mosquito bites as others

Why Do Mosquitoes Bite Some People More Than Others?




Blood type, metabolism, exercise, shirt color and even drinking beer can make individuals especially delicious to mosquitoes. Photo by Flickr user Johan J. Ingles-Le Nobel

You come in from a summer hike covered with itchy red mosquito bites, only to have your friends innocently proclaim that they don’t have any. Or you wake up from a night of camping to find your ankles and wrists aflame with bites, while your tentmates are unscathed.

You’re not alone. An estimated 20 percent of people, it turns out, are especially delicious for mosquitoes, and get bit more often on a consistent basis. And while scientists don’t yet have a cure for the ailment, other than preventing bites with insect repellent (which, we’ve recently discovered, some mosquitoes can become immune to over time), they do have a number of ideas regarding why some of us are more prone to bites than others. Here are some of the factors that could play a role:

Blood Type
Not surprisingly—since, after all, mosquitoes bite us to harvest proteins from our blood—research shows that they find certain blood types more appetizing than others. One study found that in a controlled setting, mosquitoes landed on people with Type O blood nearly twice as often as those with Type A. People with Type B blood fell somewhere in the middle of this itchy spectrum. Additionally, based on other genes, about 85 percent of people secrete a chemical signal through their skin that indicates which blood type they have, while 15 percent do not, and mosquitoes are also more attracted to secretors than nonsecretors regardless of which type they are.

Carbon Dioxide
One of the key ways mosquitoes locate their targets is by smelling the carbon dioxide emitted in their breath—they use an organ called a maxillary palp to do this, and can detect carbon dioxide from as far as 164 feet away. As a result, people who simply exhale more of the gas over time—generally, larger people—have been shown to attract more mosquitoes than others. This is one of the reasons why children get bit less often than adults, on the whole.




Photo by Flickr user Desiree N. Williams

Exercise and Metabolism
In addition to carbon dioxide, mosquitoes find victims at closer range by smelling the lactic acid, uric acid, ammonia and other substances expelled via their sweat, and are also attracted to people with higher body temperatures. Because strenuous exercise increases the buildup of lactic acid and heat in your body, it likely makes you stand out to the insects. Meanwhile, genetic factors influence the amount of uric acid and other substances naturally emitted by each person, making some people more easily found by mosquitos than others.

Skin Bacteria
Other research has suggested that the particular types and volume of bacteria that naturally live on human skin affect our attractiveness to mosquitoes. In a 2011 study, scientists found that having large amounts of a few types of bacteria made skin more appealing to mosquitoes. Surprisingly, though, having lots of bacteria but spread among a greater diversity of different species of bacteria seemed to make skin less attractive. This also might be why mosquitoes are especially prone to biting our ankles and feet—they naturally have more robust bacteria colonies.

Beer

Just a single 12-ounce bottle of beer can make you more attractive to the insects, one study found. But even though researchers had suspected this was because drinking increases the amount of ethanol excreted in sweat, or because it increases body temperature, neither of these factors were found to correlate with mosquito landings, making their affinity for drinkers something of a mystery.

Pregnancy

In several different studies, pregnant women have been found to attract roughly twice as many mosquito bites as others, likely a result of the fact the unfortunate confluence of two factors: They exhale about 21 percent more carbon dioxide and are on average about 1.26 degrees Fahrenheit warmer than others.

Clothing Color

This one might seem absurd, but mosquitoes use vision (along with scent) to locate humans, so wearing colors that stand out (black, dark blue or red) may make you easier to find, at least according to James Day, a medical entomologist at the University of Florida, in commentary he gave to NBC.

Genetics

As a whole, underlying genetic factors are estimated to account for 85 percent of the variability between people in their attractiveness to mosquitoes—regardless of whether it’s expressed through blood type, metabolism, or other factors. Unfortunately, we don’t (yet) have a way of modifying these genes, but…
Natural Repellants

Some researchers have started looking at the reasons why a minority of people seem to rarely attract mosquitoes in the hopes of creating the next generation of insect repellants. Using chromatography to isolate the particular chemicals these people emit, scientists at the UK’s Rothamsted Research lab have found that these natural repellers tend to excrete a handful of substances that mosquitoes don’t seem to find appealing. Eventually, incorporating these molecules into advanced bug spray could make it possible for even a Type O, exercising, pregnant woman in a black shirt to ward off mosquitoes for good.


Why Do Mosquitoes Bite Some People More Than Others? | Surprising Science

Startup Tel Aviv #TLV

Startup Tel Aviv - YouTube

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A Better #GoogleMaps App for #Apple and #Android Devices

Google improved Google Maps for iPhone, it’s also brought that same free app to three machines that never had it: the iPad, Android phones and Android tablets

A Better Google Maps App for Apple and Android Devices - NYTimes.com
David Pogue

Google Map’s new directory buttons.

Our story so far: Last September, Apple decided to dump the Google Maps app that had been on the iPhone for years. Apple replaced it with its own Maps app — software with so many problems that Apple’s chief executive, Tim Cook, apologized and even recommended that people use other apps until Apple could fix its own one.

In December — incredibly quickly — Google responded by introducing its own Maps app for iPhone. It’s a spectacular app, among the best apps ever written. It’s fast, beautiful and so good at guessing what you mean when you start typing a destination, it’s almost mind reading. You can read the details here.

Today, that delightful news gets even better. Not only has Google improved Google Maps for iPhone, it’s also brought that same free app to three machines that never had it: the iPad, Android phones and Android tablets. (The Android versions are available for download today; it requires the Ice Cream Sandwich or Jelly Bean version of Android — recent versions, in other words. The iOS versions will be available shortly.)

For Androidians, the biggest news is the design of the app itself. It’s modeled on the iPhone app, the one that’s simple and fast and elegant. It’s also uncluttered by the morass of menus that have always plagued the existing Maps app for Android.

But for practitioners of all religions — tablet, phone, iOS, Android — the other news is the new features that today’s new version brings. They include:

* Greater speed. All app versions are faster than before.

* Better place information. Half the time, you don’t even need navigation instructions; you just use Google Maps as the world’s smartest Yellow Pages, to find a nearby restaurant, movie theater, drugstore or whatever.

The details for found places now include a one-line description (“Chinese restaurant famous for dim sum”); a five-star rating system (including a decimal — “4.3,” for example — because, let’s face it, almost everything these days winds up with a four-star rating); the ability to upload your own photos of a place; and a more complete integration of the Zagat guides, which Google bought.

* Greater emphasis on exploration. Google Maps has always excelled at getting you to a known destination. But Google now wants the app to help you choose a restaurant, bar, store, recreation center or hotel, at least in major United States and European cities.

If you tap in the Search box without typing anything, new, photographic buttons appear: Eat, Drink, Shop, Play, Sleep. Each opens lists of corresponding facilities, sorted by criteria like Local Favorites, Popular with Tourists and so on. (Google says that these recommendations are never paid placement.)

* Traffic incidents and auto-rerouting. At last: Google Maps shows more than colored lines indicating current traffic speeds on major roads. Now it also displays tiny icons that represent accidents and construction. Tap one to read the details: “Right lane blocked on 680,” for example. (In case you were wondering, the information on traffic incidents doesn’t come from Waze, the traffic-incident app that Google recently bought. That data has yet to be incorporated into Maps.)

Better yet: Maps now looks ahead for traffic jams on your route, and interrupts your drive with a dialog box that offers to route you around it (if the new path would be quicker, of course). On its own.

* Offline maps. This feature is something of an Easter egg. It’s undocumented, a feature inserted by Google engineers simply because they wanted it. You can access it only if you know the secret. But wow, is it worth it.

This feature memorizes the map data for whatever area is displayed on your screen right now (up to a whole city in size). That way, you can use Google Maps even when you’re overseas and don’t want to turn on data roaming (because that’s insanely expensive), or when you’re in an area where there’s no cell reception. It’s very handy.

To capture a map snapshot like this, tap in the Search box. Use the speech-recognition button and say, “OK Maps.” (It’s a riff on the command “OK Glass” that prepares Google Glass, the company’s “smart headband,” for voice commands.)

A message quietly lets you know you’ve successfully stored the displayed area.

*Nice tablet layouts. On a tablet, Maps really shines. The app smartly reformats itself to take best advantage of whatever screen shape you have: two or three columns of place listings, for example, and luxuriously displayed photos and reviews for each business.

This new, improved Maps app works identically on both major flavors of phone and tablet. You know what? I don’t care how much you distrust Google and its motives. This is crazy good software, some the best work Google has ever done.

Read the article online here:  Better Google Maps App for Apple and Android Devices - NYTimes.com

Report: Web monitoring devices made by U.S. firm Blue Coat detected in Iran, Sudan - #surveillance

These devices are turning up in places they’re not supposed to be

Report: Web monitoring devices made by U.S. firm Blue Coat detected in Iran, Sudan - The Washington Post

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Experts say that in Syria, Blue Coat’s tools have been used to censor Web sites and monitor the communications of dissidents, activists and journalists. In Iran and Sudan, it remains unclear exactly how the technologies are being used, but experts say the tools could empower repressive governments to spy on opponents.
“These devices are turning up in places they’re not supposed to be,” said Morgan Marquis-Boire, a project leader at the University of Toronto’s Citizen Lab, which detailed the findings in a new report provided to The Washington Post. “The human rights implications of finding these surveillance technologies in these countries are extremely worrying. It’s a systemic problem.”
Blue Coat promotes itself as a leading provider of Web security and management. According to its Web site, it has 15,000 government and corporate customers worldwide. Its products, including high-end computer systems, are used for myriad purposes, including filtering for computer viruses and child pornography.
Some technology experts, however, have argued that because Blue Coat’s tools have various uses, they fall into regulatory gaps and are thus not subject to certain export restrictions.
“The only thing stopping the export of human-rights-abusing equipment to a country like Sudan is the blanket restriction on exports under the sanctions program,” said Collin Anderson, an independent consultant on the Blue Coat report, which is to be released Tuesday. “There are no controls in place right now on equipment that can also be used to violate human rights.”
David Murphy, Blue Coat’s chief operating officer and president, said the company takes reports about its products in countries under U.S. trade embargoes very seriously. The firm, he noted, is cooperating with a U.S. investigation into how a reseller managed to get the devices into Syria on a few occasions in 2010 and 2011.
“Blue Coat has never permitted the sale of our products to countries embargoed by the U.S.,” Murphy said. “We do not design our products, or condone their use, to suppress human rights. . . . Our products are not intended for surveillance purposes.”
A spokesman for the Treasury Department’s Office of Foreign Assets Control, which enforces U.S. sanctions, declined to comment on the new allegations other than to say, “Treasury takes sanctions violations very seriously and has aggressively pursued enforcement actions where violations have occurred.”


Report: Web monitoring devices made by U.S. firm Blue Coat detected in Iran, Sudan - The Washington Post

Carlos #Slim invests $40m in music app #Shazam - FT.com

América Móvil, the telecoms operator controlled by Carlos Slim, has invested $40m in music recognition app Shazam, in what is thought to the Mexican billionaire’s first investment in a UK company.

Shazam will be preloaded on handsets sold by América Móvil from later this year, easing its path to millions of potential users in Latin America.

“It’s Latin America that’s going to be the focus now, alongside North America and Western Europe,” said Andrew Fisher, Shazam’s executive chairman.

The parties declined to comment on the size of Mr Slim’s stake, although a person with knowledge of the deal said the investment valued Shazam slightly above $400m.

Read the rest of the article online here: Carlos Slim invests $40m in music app Shazam - FT.com

#Apps for #Kids Are #Data Magnets; FTC Rules to Kick In - WSJ.com

How Kid Apps Are Data Magnets

While 7-year-old Eros ViDemantay played with a kid's app on his father's phone, tracing an elephant, behind the scenes a startup company backed by Google Inc. GOOG +0.24% was collecting information from the device—including its email address and a list of other apps installed on his phone.

Explore the Findings of the Journal's Tests

"My jaw dropped," says Lee ViDemantay, Eros's father and a fifth-grade teacher at the Los Angeles Unified School District. "Why do they need to know all that?" The app, called "How to Draw—Easy Lessons," also sent two of the phone's main ID numbers.

A Wall Street Journal examination of 40 popular and free child-friendly apps on Google's Android and Apple Inc.'s AAPL -0.07% iOS systems found that nearly half transmitted to other companies a device ID number, a primary tool for tracking users from app to app. Some 70% passed along information about how the app was used, in some cases including the buttons clicked and in what order.

Some three years after the Journal first tested data collection and sharing in smartphone apps—and discovered the majority of apps tested sending details to third parties without users' awareness—the makers of widely used software continue to gather and profit from people's personal information.

Data transmissions related to child-friendly apps will be subject to greater government scrutiny after July 1, when the Federal Trade Commission's new rules on children's online privacy take effect. The rules, which were adopted in December and outline how the FTC enforces the Children's Online Privacy Protection Act, or Coppa, expand the types of information considered "personal" and, hence, protected.

These rules could upend the business of some kid-friendly apps that rely on data-driven advertising to bring in money.

Among other things, the new rules will govern collection of location data and certain types of phone ID numbers. The FTC isn't banning collection of this information altogether. But app developers—and all online services—won't be able to use it in as many ways as before without receiving explicit parental consent.

The Journal's latest tests in February and March observed two Android apps, including "How to Draw," incorporating code from Pocket Change, the Google-backed company, and sending the company data without notifying users of these transmissions.

While many of the apps tested sent device IDs to third-party companies, apps with Pocket Change's code sent considerably more information including the device's registered email address, list of other apps installed on the device, and information about the user's phone carrier.

Pocket Change is a company that provides a virtual "currency" that users can accrue by achieving various goals (such as reaching new game levels) and can redeem for music downloads, gift certificates and physical goods. Pocket Change makes money by charging companies for their products to appear in its rewards store.

On its website, Pocket Change says it is on 500 apps, and that 50 million people have earned the virtual currency. The San Francisco company uses the data it collects to identify people claiming the rewards, as well as to help advertisers tailor offers to specific users, says Ari Mir, Pocket Change's CEO.

Pocket Change says it doesn't target children. After the Journal's tests, Pocket Change said it updated its system to collect data only after a person agrees to sign up for the service, rather than automatically. The company said it had already planned to change its system before being contacted by the Journal.

A Google official declined to comment on its investment in Pocket Change.

Getty ImagesA Wall Street Journal examination of 40 popular and free child-friendly apps on Android and Apple systems found that nearly half transmitted to other companies a device ID number, a primary tool for tracking users from app to app.

Alfiya Valiullina, a spokeswoman for the Siberian company that makes "How to Draw," ArtelPlus, said ArtelPlus wasn't aware of how much data Pocket Change was collecting. An app-update published on May 24 removed Pocket Change's code as well as access to the user's email address.

The FTC regulations govern apps and online services "directed to children" under 13, but the FTC doesn't strictly define what that means. The commission says it takes into consideration factors including "subject matter, visual content, use of animated characters" as well as the "presence of child celebrities."

The FTC declined to comment on the Journal's findings.

The Journal tested 20 popular free, child-friendly applications each from Apple's App Store and Google's Play market. The apps were drawn from the two most kid-friendly categories on each platform: For Apple, these two were "Education" and the "Kids" subcategory of "Games." For Android it was "Casual" and "Education." Child-friendly apps that may also appeal to adults were included in the tests, but those clearly geared only toward teenagers or older users weren't.

Apple and Google declined to comment on the coming Coppa changes and the Journal's findings.

The majority of apps—28 of 40—sent data to other companies that provide analytics services that track the ways people use particular apps. The data can range from simple details—for example, when a user opens or closes an app—to complex behavioral patterns. Developers use this information to decide how to improve their games, for example, or what in-game products they might be able to sell to users.

Analytics and advertising company Flurry received data from the most apps in the Journal tests, 23 of the 40. Flurry's website says the company gathers "insight from 2.8 billion app sessions per day."

Flurry didn't respond to requests for further information. Flurry's terms of service prohibit child-targeted apps from using its products.

Intellijoy, the developer of "Kids ABC Letters Lite" and four other Android apps the Journal tested, used Flurry in each. The company will be removing Flurry from its apps before the July 1 deadline and "forgoing analytics altogether until we find and select a Coppa-compliant replacement," CEO Alex Turetsky said in an email.

The tests highlighted another issue for makers of children's apps: Under what circumstances they will be allowed to collect "device identifiers" and send them to other companies. Advertising and analytics firms typically use the numbers to track people as they hop from app to app, or as they use an app multiple times. Eighteen of the apps sent device IDs to other companies.

The new Coppa rules count "persistent identifiers" as "personal information" protected under the act. Developers will be allowed to collect the IDs for "activities necessary to [maintain] or analyze the functioning" of the app. But to use the identifiers for behavioral advertising or for targeting individual children, they must obtain "verifiable parental consent."

Unique, persistent identifiers—the type that are impossible or very difficult to change, and which can be used to track people over time and across services—are controversial in the app world. Apple has been phasing out developers' access to its primary device ID, called a UDID, in favor of other, resettable identifiers. On May 1, Apple's App Store stopped accepting apps that access UDIDs. The Android equivalent, called the Android ID, is largely, though not completely persistent: It changes when users "factory reset" their devices, which also deletes all apps and stored data.

Android requires apps to tell users, before installing software, what types of information the apps can gather. Google declined to comment on Android's permission system.

Apple declined to comment on the iOS permission system.

In Apple's iOS operating system, apps don't request any particular permissions before being downloaded. Instead, Apple segregates user data into three categories: data, such as certain phone identifiers, available to all apps; data available upon in-app request, such as geolocation; and data off-limits to all apps, such as email addresses. Apps that want emails have to ask people to type them in.

Some app developers and ad companies worry that the new FTC rules mean they won't be able to learn as much about users and therefore sell ads that are "targeted" at specific types of people based on what can be known about their interests and activities. Targeted ads generally command higher prices. The majority of apps tested, 25, used other companies to provide ad services. Many free apps rely on such advertising for their revenue.

The FTC permits ads in children's apps but says they can't be based on any information the advertising service gathers about individual children, unless a parent explicitly allows it. But random ads present their own problem. While Eros was playing with "How to Draw" on his dad's phone, for example, he saw an ad for an online dating site that asked viewers to "Flirt" with "Girls," "Guys" or "Both."

At the time of testing, Pocket Change didn't protect user accounts with passwords, instead tying account information to a device identifier. Such identifiers would be difficult for most people to guess, but they could be obtained by malicious applications. Coppa requires online services to store children's data securely.

After the Journal contacted Pocket Change, the company began protecting account information with a password. The company said it had already planned to change its system when before being contacted by the Journal.

The developer of the other app that included Pocket Change code, "Jewels," said his game, which involves players lining up matching jewels, isn't tailored to children. The developer, Finland-based Mika Halttunen, said he hadn't been aware of all the data Pocket Change was receiving and decided not to add the service to his recently released sequel, "Jewels 2."

Write to Jeremy Singer-Vine at Jeremy.singer-vine@wsj.com and Anton Troianovski at anton.troianovski@wsj.com

A version of this article appeared June 28, 2013, on page B1 in the U.S. edition of The Wall Street Journal, with the headline: Apps for Kids Are Data Magnets; FTC Rules to Kick In.

Apps for Kids Are Data Magnets; FTC Rules to Kick In - WSJ.com

Exclusive: Documents Illuminate #Ecuador's Spying Practices #NSA #Snowden

#NSA counter attacks:

Exclusive: Documents Illuminate Ecuador’s Spying Practices



The country where anti-surveillance hero Edward Snowden wants to take refuge spent half a million dollars on an Israeli-made “GSM interceptor” in a deal brokered by a U.S. middleman. Seeking the capacity to “intercept text messages, falsify and modify the text messages” among other tricks. posted on June 25, 2013 at 7:01pm EDT


A supporter of Edward Snowden holds a sign outside the Embassy of Ecuador in London June 24. Image by Luke Macgregor / Reuters


WASHINGTON — The intelligence agency of Ecuador appears to have sought in recent months to obtain new equipment for a large-scale surveillance, according to confidential government documents obtained by BuzzFeed.

The capabilities sought by Ecuador resemble the National Security Agency practices revealed by Edward Snowden, who is reportedly seeking asylum in the left-leaning Latin American republic.

The Ecuadorian documents — stamped “Secret” — obtained by BuzzFeed appear to show the government purchasing a “GSM Interceptor” system, among other domestic spying tools, and they suggest a commitment to domestic surveillance that rivals the practices by the United States’ National Security Agency that are at the center of a fierce national debate. They include both covert surveillance capacities and the targeting of President Rafael Correa’s enemies on social media. According to the files, SENAIN keeps close tabs on the Facebook and Twitter accounts of journalists, opposition politicians and other individuals, some with few followers.

Ecuador, which has been harboring WikiLeaks founder Julian Assange for over a year at its embassy, has been internationally criticized for a recent communications law that is widely seen as a gag order for the media and includes prohibitions on “media lynching.”

Ecuador also has a record of being ahead of the game in domestic surveillance. Last year, it became the first country in the world to implement a nation-wide facial and voice recognition system.

The documents and correspondence obtained by BuzzFeed appear to show that SENAIN, Ecuador’s intelligence agency, paid $526,500 January 2013 for equipment through 500 Smart Solutions LLC, a company registered in Delaware that is listed as having an office in New York. The payment, according to the documents, was for services rendered from August to December 2012. Smart Solutions acted as an intermediary through which SENAIN could buy materials from two Israeli security contractors: Elkat LTD Security Engineering and UVision Air LTD, which manufactures drones. SENAIN bought surveillance equipment from the companies through Smart Solutions.

Elkat is described by the publication IsraelDefense as “a leading Israeli distributor of advanced electronic equipment for the security field” whose products include “highly advanced electronic surveillance systems.” It is based in Tel Aviv.

The documents were provided to BuzzFeed from inside SENAIN through activists who wished to call attention to the government’s spying practices in the context of its new international role. The sources who provided the documents on the condition of anonymity, citing the dangers of attempting to publicize them domestically.

They also suggest that the Ecuadorians sought to buy drones. Smart Solution proposed two surveillance systems to SENAIN, one called the “Semi Active GSM Interceptor System” and the other called a “Passive Surveillance System. ”

In a letter to Pablo Romero last year in June, a Smart Solutions representative named Gabriel Guecelevich touted the capabilities of the GSM system, promising the abillity to “copy SIM cards, identify phone calls, route phone calls to different places, intercept text messages, falsify and modify the text messages, keep messages in their system, disconnect calls, block phone calls, system should be able to intercept a minimum of 4 phone calls simultaneously.”

(The correspondence, posted in full below, is in Spanish.)

Guecelevich also specified that the GSM system, which has previously been mentioned in WikiLeaks files as a spy tool, can be used from a car that is 250 meters away and that it is portable. Guecelevich explained which tests Smart Solutions can run to prove that the system works. The first system, he wrote, is intercepting technology; the second is a passive system that can intercept GSM communication which Guecelevich promised can process 32 channels simultaneously, record conversations, among other capabilities.

In August, an official from SENAIN wrote to Smart Solutions about wanting to acquire unmanned drones.

“The National Secretary of Intelligence, which has within its powers projects focused on national security, is moving forward with a project to acquire unmanned aerial vehicles,” communications and special projects coordinator José Miguel Delgado wrote. “It is for this reason that we need to know whether Smart Solution is capable and legally able to provide these assets or services.”

Delgado also wrote to Smart Solutions about conducting GSM tests in the city of Tulcan in August.

Also in August, the Israeli company Elkat gave Smart Solution permission to sell products from Uvision to “potential clients in Ecuador,” according to the documents.

One of the documents is a draft of a letter Romero wrote to Smart Solution to let them know of the decision to purchase the equipment and the $526,500 payment for the equipment. Payment was promised upon the delivery of the goods in March.

Invoices Smart Solution sent to SENAIN for equipment and internal SENAIN calculations also tabulate the cost. Two of the documents show plans for a new SENAIN center in Guayaquil, the largest city in Ecuador.

Smart Solution was incorporated in Delaware by Guecelevich on July 25, 2012, and lists only a Delaware address. Guecelevich did not return a request for comment, and the company has no obvious public presence.

The people who provided BuzzFeed with these documents say that they attempted to leak them to WikiLeaks three days ago, but were unsuccessful. WikiLeaks spokesman Kristinn Hrafnsson called this claim “false” and said “No one in our team recognises having been approached with such material as you describe.”

Ecuadorian officials did not respond to a inquiry through their embassy in Washington.

This post has been updated with a comment from the WikiLeaks spokesman. (6/26, 12:13 p.m.)

Smart Solutions proposal to SENAIN

Letter from SENAIN to Smart Solutions

Letter From SENAIN Concerning Drones



Go online to see the above documents and more:

Exclusive: Documents Illuminate Ecuador's Spying Practices







The Pangea Advisors Blog

#Data storage: Spying fears highlight worth of #Swiss data centres - swissinfo.ch #NSA

Having your #datacentres outside of the USA is becoming ever so more important now with the NSA on a full blown assault on all #Data

Spying fears highlight worth of data centres
Data storage

by Matthew Allen, swissinfo.ch


June 24, 2013 - 11:00


The granite grey slab of the Swisscom data centre outside Bern can protect its clients’ most valuable assets from bombs, earthquakes and even a direct aircraft hit. It’s only one of the reasons why there’s growing interest in such hubs.
The centre’s stark concrete vaults also protect the highly sensitive information of banks and other clients from the prying eyes of governments or economic spies. ‘Trust’ is the watchword of the expanding Swiss data storage industry as it quietly carves out a highly lucrative global niche. Recent revelations of United States intelligence agency spying, coupled with ongoing reports of espionage emanating from China, may have raised public consciousness of the dangers to data but the industry has known about it for years. At the Swisscom centre in Zollikofen, canton Bern, no stone has been left unturned to protect its valuable cargo from any form of threat. Six powerful diesel-powered generators are kept permanently warmed, ready to kick into life within 15 seconds and able to power the entire centre’s operations in the event of total power failure. Thousands of video, heat and infra-red sensors would detect anyone who managed to get past the strict entrance security controls. Staffing is kept to a minimum, leaving the ranks of servers unmolested. Enquiries related to encryption techniques and other measures to prevent cyber intrusion are met with a polite but firm “no comment”. Political stability, a tradition of confidentiality and strong data protection laws have all added to Switzerland’s growing reputation as an international data safe house. Unlike in the US, even the Swiss government would need a court to approve each request for data. “Clients increasingly want to entrust their data to a jurisdiction where there is legal certainty,” Bruno Messmer, head of sourcing consulting at Swisscom, told swissinfo.ch. “This will be one of Switzerland’s many strong selling points in the future.”


Expansion
Some data storage providers have taken security to extremes, housing their servers in ex-military alpine bunkers, such as the aptly-named ‘Fort Knox’ in canton Bern. One company using the bunker, Siag – which labels itself the “Swiss private bank for digital assets” - refuses to deal with US clients on security grounds. “We decided 10 years ago not to deliver data to the US because we knew we could not do it without giving [the US intelligence agencies] a back door [access to this data],” Siag chief executive Christoph Oschwald told swissinfo.ch. While Switzerland is a relative minnow in the data storage industry compared to the US or Britain it will still carve out some 160,000 square metres of secure space by the end of this year, expanding to more than 200,000 by 2016, according to market research consultants Broadgroup. This equates to the second densest data storage capacity per capita in Europe, second only to Ireland. The comparison between the two countries is no accident as both compete to attract multinational company HQs to their borders. “The broad benefits that Switzerland offers as a location for companies, such as tax, skilled labour, a stable economy and reliable legal situation, also attracts data,” Broadgroup managing director Steve Wallage told swissinfo.ch. “In many cases these companies like to set up their data centres within an hour’s drive from the office.”


Green credentials
Relatively cheap and reliable energy supplies and a strong real estate market, that encourages investors to build in Switzerland, are also strong attractions. In addition, some niche players have attracted business by displaying their green credentials. One of the biggest concerns for data centres is wastage with some two thirds of energy lost through heat. The Swisscom Zollikofen centre, together with a sister centre in Bern, uses enough energy to power a 150,000 population town. Swisscom’s new building in the Bern suburb of Wankdorf will recycle that energy to heat new homes being built by the city. The Green Data Center in Lupfig, canton Aargau, also employs heat exchangers to redirect lost energy to other buildings. It also boasts the latest power saving direct current (DC) technology and offers clients the option of using renewable only energy sources. The sustainable energy is not just a green gimmick and would not attract clients purely on social grounds, Franz Grüter, chairman of the parent company green.ch told swissinfo.ch. “Clients are not really interested in the latest cleantech technology unless you can show them it will save them money,” he said. “The less energy we waste, the less we have to use for cooling the servers. Our measures save us 20 per cent on our energy costs.” The data storage industry in Switzerland faces some challenges ahead, not least because it has limited space and tough planning procedures. The future supply of cost efficient energy is under some doubt after Switzerland’s decision to scrap its nuclear power stations and the handover of banking data to the US has undermined its reputation for confidentiality. But the recent tales of US intelligence data espionage might make up for that to some degree, according to Broadgroup’s Steve Wallage. “Several Middle East companies have already targeted Switzerland because they distrust the US,” he told swissinfo.ch. “The stories coming from the US have chipped away at people’s confidence and that could be good news for a market like Switzerland.”


Matthew Allen, swissinfo.ch






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See the article online here: Data storage: Spying fears highlight worth of data centres - swissinfo.ch

The Geek that Knew Too Much Why #NSA IT Guy Leaked Top Secret Documents

Why NSA IT Guy Edward Snowden Leaked Top Secret Documents - Forbes




Edward Snowden

When the Washington Post described the person who leaked a NSA PowerPoint presentation about “PRISM” as a “career intelligence officer,” I was expecting the kind of 50-something technocrat that Bryan Cranston would play in the inevitable movie about the ‘NSA Papers.’ But on Sunday, the Guardian revealed that the person behind a series of leaks that have provided an unprecedented peek into how one of America’s most secretive spy agencies works is a 29-year-old high school drop-out whose computing skills allowed him to get jobs with the CIA and contractors for the National Security Agency.




This may be the NSA office in Hawaii from which Edward Snowden worked. Seriously. (screenshot of NSA press release on center's opening)

Edward Snowden tells the Guardian that he had a $200,000 job with defense contractor Booz Allen Hamilton — to that company’s chagrin — doing work for the NSA at its office in Hawaii. That office is likely the rainbow-shooting $358 million Hawaii center cited in a 2012 NSA press release which is tasked with processing “data from a broad variety of sources at various classification levels” and “eliminating physical, virtual, and other barriers to information sharing.” Snowden certainly did the latter, though not as the NSA intended it, sharing with the press top secret documents about the degree to which telecoms and Internet companies pass along customers’ data to the NSA, presidential preparation for cyberattacks on other countries, and the tools the NSA uses to monitor the healthiness of its global information collection. All these documents are available on the Guardian site here. Snowden took the documents to Glenn Greenwald at the Guardian after the Washington Post failed to publish the PowerPoint presentation within a 72-hour deadline he set, writes Barton Gellman.




NSA Contractor Booz Allen Hamilton Rushes To Distance Itself From Staffer Who Leaked Top Secret Docs Andy Greenberg Forbes Staff

Snowden describes himself as a systems administrator, which basically means he was an NSA IT guy. And like the IT guys in any office, he could see (and capture) many of the documents flying around on his network. (And that my friends, is one reason why you shouldn’t sext on company devices or from company email accounts; IT guys see all.) He describes himself in a video on the Guardian site as “being able to see everything;” he had the kind of spying ability on the NSA that it would love to have on the wider Internet.

“When you’re in positions of privileged access, like a systems administrator for the intelligence community agencies, you’re exposed to a lot more information on a broader scale than the average employee,” says Snowden in a video. “Because of that you see things that may be disturbing. Over the course of a normal person’s career, you’d only see one or two instances, but when you see everything, you see them on a more frequent basis.”

And he happened to be a libertarian-leaning, Internet-freedom-loving geek, judging from donations he made to the Ron Paul campaign and the EFF and Tor stickers on his laptop. In other words, exactly the kind of person who would be alarmed by the kind of documents he was seeing floating around the NSA about Verizon turning over call records and Internet companies being part of secret programs to turn over user data.

But the director of national intelligence’s claim that many of the documents being released were being misinterpreted because they were being taken out of context is now more understandable. Snowden wasn’t involved in these programs; he was just seeing documents — and I assume — seeing chatter about them. That’s how he took this PowerPoint slide describing the NSA’s ability to both gather data flowing through fiber-optic cables (which confirms a long-held allegation by whistleblowers) and to get data “directly from the servers of these U.S. Internet providers: Microsoft, Yahoo, Google, Facebook, Paltalk, AOL, YouTube, Skype, Apple” to mean that the government had “direct access” to those companies’ servers. Since then, it’s emerged that it’s a more complicated process that does involve court orders and is directed only at non-U.S. citizens… which won’t be especially reassuring to these companies’ customers abroad as noted by David Kirkpatrick.

Many people see objectionable practices in their workplaces. Most grumble to colleagues or complain to a sympathetic spouse. Why did Snowden decide to share what he saw with the world, torpedoing his $200,000 job, forcing him to flee the country and hole up in a Hong Kong hotel, and risking a lifetime in prison if he’s successfully prosecuted for violating the Espionage Act? He has been interviewed by the Guardian and by the Washington Post about why he leaked the documents; here’s a collection of his quotes explaining his motivation:

• Concern about how easy it is to spy on people given the way we live today: “The internet is… a TV that watches you. The majority of people in developed countries spend at least some time interacting with the Internet, and governments are abusing that necessity in secret to extend their powers beyond what is necessary and appropriate.” (Washington Post)
• Fear of a surveillance state: “I believe that, at this point in history, the greatest danger to our freedom and way of life comes from the reasonable fear of omniscient State powers kept in check by nothing more than policy documents… It is not that I do not value intelligence, but that I oppose . . . omniscient, automatic, mass surveillance. . . . That seems to me a greater threat to the institutions of free society than missed intelligence reports, and unworthy of the costs.” (Washington Post)
• To encourage other whistleblowers: He wanted “to embolden others to step forward” by showing that “they can win.” (Washington Post)
• To let people in on what they don’t usually get to see: “I will be satisfied if the federation of secret law, unequal pardon and irresistible executive powers that rule the world that I love are revealed even for an instant.” (Washington Post) // “I think the public is owed an explanation of the motivations behind the people who make these disclosures outside the democratic model… My sole motive is to inform the public as to that which is done in their name and that which is done against them.” (The Guardian)
• Because he thinks these programs should be debated openly, and not just by government officials in the U.S.: “[T]he debate which I hope this will trigger among citizens around the globe about what kind of world we want to live in.” (The Guardian)
• Because the revelation was worth more than a happy life with his girlfriend and “a high-paying job in paradise”: “If living unfreely but comfortably is something you’re willing to accept, you can get up everyday, go to work and collect your large paycheck for relatively little work against the public interest and go to sleep at night after watching your shows. But if you realize that’s the world you helped create and it’s going to get worse with the next generation and the next generation who extend the capabilities of this sort of architecture of oppression, you realize you might be willing to accept any risk and it doesn’t matter what the outcome is as matter as the public gets to decide how that’s applied… I’m willing to sacrifice all of that because I can’t in good conscience allow the US government to destroy privacy, internet freedom and basic liberties for people around the world with this massive surveillance machine they’re secretly building.” (The Guardian)
• Because he could: “I’m no different from anyone else. I don’t have special skills. I’m just another guy who sits there day to day, watches what’s happening and goes, ‘This is something that’s not our place to decide.’ The public needs to decide whether these policies or programs are right or wrong. I’m willing to go on the record to defend the authenticity of them. This is the truth, this is what’s happening. you should decide whether we should be doing this.” (Video on the Guardian)
• Allegedly not for the fame: “I’ve been a spy for almost all of my adult life — I don’t like being in the spotlight.” (Washington Post) // “I don’t want public attention because I don’t want the story to be about me. I want it to be about what the US government is doing.” (The Guardian)
• Because what he saw makes him feel like he’s living in a sci-fi novel about a totalitarian state: “They are intent on making every conversation and every form of behaviour in the world known to them.” (The Guardian) // “Even if you’re not doing anything wrong, you’re being watched and recorded… you don’t have to do anything wrong, you simply have to eventually fall under suspicion from somebody even by a wrong call and then they can use the system to go back in time and scrutinize every decision you’ve ever made, every friend you’ve ever discussed something with and attack you on that basis to derive suspicion from an innocent life and paint anyone in the context of a wrongdoer.” (Video on the Guardian)
• Not because he thinks the government is a pushover: In a note to reporters when releasing the documents, says Gellman, he wrote that the U.S. intelligence community “will most certainly kill you if they think you are the single point of failure that could stop this disclosure and make them the sole owner of this information.” (Washington Post)
• Because he loves the concept of privacy: “I don’t want to live in a world where there’s no privacy and therefore no room for intellectual exploration and creativity.” (The Guardian)

Why NSA IT Guy Edward Snowden Leaked Top Secret Documents - Forbes

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#Venezuela's toilet paper shortage now has a solution: #Abasteceme - ¡We have an Android #App for that!

#Venezuela's toilet paper shortage now has a solution: #Abasteceme - ¡We have an Android #App for that!

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federal agencies do not need a warrant to read #emails older than six months

Emails are not private. A message may have one sender and one recipient but it can, with little effort, be read by a third party. In fact, despite the Fourth Amendment’s protections against unlawful searches, federal agencies do not necessarily need a warrant to read emails older than six months. 

Concerns over such government snooping were raised by the American Civil Liberties Union, which last week noted a “troubling picture” of email surveillance practices by the Federal Bureau of Investigation and the Department of Justice. The agencies may be taking advantage of a component of the Electronic Communications Privacy Act, which requires warrants only for emails that have been stored on a third-party server for less than 180 days. 

 Read the story online here: How to stop the FBI from reading your email - MarketWatch

Will “Windows Classic” be #Microsoft’s Coke Classic?

No doubt, if Microsoft reverses course over #Windows 8 – for instance, by restoring the familiar “Start” button to the opening screen – it will provide abundant fodder for the writers of business school case studies.
But is the comparison with Coca-Cola’s famous 1985 marketing U-turn, when it brought back “Coke Classic” following a consumer backlash against its “New Coke” recipe, correct?

See the whole post here on the FT's Business Blog: Will “Windows Classic” be Microsoft’s Coke Classic? | FT's Business blog

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#Microsoft's Gates: #iPad Users Really Just Want a Surface

Gates claimed that current tablets suffer from a lack of PC features — features that Microsoft is delivering to them with Surface and Windows 8.

Read the article on All Things D

Microsoft’s Gates: iPad Users Really Just Want a Surface

How Many #HFT Firms Actually Use #Twitter to Trade? - Businessweek

The market’s quick 140-point plunge and recovery shows the vulnerability of trading algorithms to false social media reports

 How Many HFT Firms Actually Use Twitter to Trade?

By Matthew Philips on April 24, 2013

http://www.businessweek.com/articles/2013-04-24/how-many-hft-firms-actually-use-twitter-to-trade

Yesterday’s fake tweet from the Associated Press’s hacked Twitter account, reporting explosions at the White House that injured President Obama, has sparked renewed criticism of high frequency trading, specifically how some computer traders use social media as an input into their trading strategies.
Though it’ll be months before we know exactly what happened, the consensus is that a handful of trading algorithms responded to the fake tweet by selling a broad range of stocks, bonds, and commodities. As message traffic spiked and prices started declining, HFT firms started backing out of the market, just as they did during the May 2010 Flash Crash. As a result, liquidity dried up, as you can see here in this chart from Nanex. Since there were suddenly relatively few buy orders to match against all those sell orders flooding the market, the dip picked up speed.
“When the amount of bids and offers thins out like that, it takes very little volume to move the market in a big way,” says Manoj Narang, chief executive officer and founder of Tradeworx, a Red Bank (N.J.)-based HFT firm. When he noticed the sudden spike in messaging traffic, Narang instructed his traders to back off the number of orders they were sending into the market. “When you’re in the business of posting bids and offers and something is up that you don’t know about, you back off.”
Within two minutes, the Dow was down 140 points, the S&P 500 index had lost nearly 1 percent, and an estimated $200 billion in U.S. stock market value had vanished. As word spread that the tweet was fake, prices quickly stabilized. A chart of the day’s trading shows a deep, narrow trench carved into the middle—a stab wound, almost.
While there are trading firms that have begun dabbling in aggregation and analysis tools to scour news feeds for useful information, most of them aren’t trading directly off that information. And fewer still are actually trading off Twitter, even though less than a month ago, social media received the blessing of regulators to be a conduit for market-moving news.
One of the most common ways financial firms plug these data streams into their models is through middleman firms such as RavenPack, which aggregates news from thousands of sources. Each day its systems put out anywhere from 20,000 to 50,000 “clean messages” culled from corporate newswires and professional news sources.
Each message is ascribed a sentiment score from zero to 100 to tell clients if it’s negative or positive news for the companies mentioned. For most firms, it’s merely one more piece of data to add to their trading model. According to CEO Armando Gonzalez, RavenPack sells this news feed to 12 of the 20 top performing quantitative hedge funds in the world.
There’s a big difference, though, between taking the kind of data that RavenPack sends to clients and mainlining Twitter’s “firehose” feed directly into your trading algorithm, allowing the model to place trades instantly off the information it’s gleaning through some sort of text-analysis program. Clearly, that’s exactly what a few firms are doing.
Gonzalez says some of his clients have told him that a handful of high-frequency trading firms forgo filtering and pour Twitter data directly into their algorithms. “There are a few HFT firms that have, I would argue, irresponsibly added raw Twitter feeds into their systems,” says Gonzalez. He says he doesn’t know the name of any firm that does so. Neither does Narang. “I’m sure there are a few, but I’m skeptical there are many of them, or that they’re very big,” says Narang.
Gnip, DataSift, and Topsy pay Twitter for access to all 400 million tweets a day from 200 million users. They take that “firehose” feed and customize it for marketers, research firms, and increasingly, trading firms. According to Seth McGuire, director of business development at Gnip, based in Boulder, Colo., quantitative hedge funds began contacting the company two years ago, asking for the Twitter feed. Today, McGuire says Gnip sends the raw Twitter feed to “over a dozen” quantitative hedge funds, each with at least $1 billion of assets under management.
Before launching in November 2011, San Francisco-based DataSift was getting “a fair amount of calls from all kinds of hedge funds, big investment banks, even individual traders about wanting a social-media feed,” says CEO Rob Bailey. Today, financial services firms are among the 150 corporate clients that pay DataSift anywhere from thousands to tens of thousands of dollars a month for custom social-media feeds, including ones from Twitter. “We cost less than some investment banks spend on pizza,” says Bailey.
Bailey says he has no idea whether any of his clients traded on the fake tweet. “If there’s a lesson, it’s just how important it is to have Big Data scientists on staff and that you shouldn’t just plug Twitter into your algorithm.”
As Narang points out, the vast amount of trading done by computers is statistical in nature, meaning algorithms look for historical patterns in the volumes of market data they sort through every day. The problem with tweets is two-fold. One, they’re super noisy, so gleaning a decent signal out of them takes a lot of analysis and is still pretty hairy. But also, even though some 400 million tweets get sent every day, there’s still not enough historical data out there. They’re still too new. “It’s simply not possible to commit lots of capital to finding patterns that appear on Twitter,” says Narang. “The reliability is in question.”
The hacked AP account is the second major security breach at Twitter this year. In February hackers gained access to e-mail addresses and passwords associated with 250,000 user accounts. Now that billions of dollars are being traded at least in part based on information gleaned from Twitter, computer trading experts think it opens a window into a new kind of financial crime. “This incident is an example where market manipulation meets terrorism,” says John Bates, chief technology officer of Progress Software, which designs trading and compliance programs. “One doomsday scenario is that al-Qaeda takes control of a hedge fund and drives the market one way to make billions in profits or crash the markets.”
The bottom line: The market’s quick 140-point plunge and recovery shows the vulnerability of trading algorithms to false social media reports.

 
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How Many HFT Firms Actually Use Twitter to Trade? - Businessweek