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"Apple is developing own chip designs—which might breach Imagination's IP," firm claims.
DAILY VIDEO: Verizon negotiates down to $4.55B for Yahoo transaction; Congressional staffers see Russian hacking, FISA vote as priorities; IBM launches machine learning for z System mainframes; and there's more.
samazgorreader comments 13 Share this story Facebook has been accused of misleading the European Commission over its $22 billion takeover of WhatsApp in 2014—when the Mark Zuckerberg-run company claimed that it wouldn't be able to knit together user IDs, thereby combining the data of the two services. Brussels' competition officials issued a charge sheet against Facebook on Tuesday, in which it is alleged that the free content ad network failed to disclose that "the technical possibility of automatically matching Facebook users' IDs with WhatsApp users' IDs already existed" at the time of the merger. Antitrust chief Margerthe Vestager said that companies must provide "accurate information" during routine competition probes into planned acquisitions. "They must take this obligation seriously," she said. "In this specific case, the commission's preliminary view is that Facebook gave us incorrect or misleading information during the investigation into its acquisition of WhatsApp.

Facebook now has the opportunity to respond." Facebook has been slapped with a so-called Statement of Objections by the commission, which claims that the multinational "intentionally, or negligently, submitted incorrect or misleading information" to the competition wing of the EC, thereby allegedly breaching its obligations under the EU Merger Regulation. It comes after WhatsApp confirmed in August that it planned to merge user phone numbers with Facebook user accounts—much to the chagrin of privacy campaigners in Europe. At the time, it claimed that the information would be used to offer users "more relevant" Facebook ads, new "ways for people to communicate with businesses" via the app, and new friend suggestions. By mid-November, Facebook had stopped sharing WhatsApp user data across Europe, after it was forced to respond to regulatory pressure in the UK and Germany. Weeks earlier, data watchdogs across the EU who sit on the Article 29 Working Group urged Facebook "not to proceed with the sharing of users' data until the appropriate legal protections can be assured." Now Vestager's office has separately entered the fray with tentative charges brought against Facebook that could lead to it being fined up to one percent of its annual turnover. The commission also explained the rationale behind its decision to wave through Facebook's buyout of WhatsApp unchallenged in late 2014.
It said: With respect to consumer communications services, the commission found that Facebook Messenger and WhatsApp were not close competitors and that consumers would continue to have a wide choice of alternative consumer communications apps post-merger.

Although consumer communications apps are characterised by network effects, the investigation showed that a number of factors mitigated the network effects in that case. As regards social networking services the commission concluded that, no matter what the precise boundaries of the market for social networking services are and whether or not WhatsApp is considered a social network, the companies are, if anything, distant competitors. With respect to online advertising, the commission concluded that, regardless of whether Facebook would introduce advertising on WhatsApp and/or start collecting WhatsApp user data for advertising purposes, the transaction raised no competition concerns.

This is because, besides Facebook, a number of alternative providers would continue to offer targeted advertising after the transaction, and a large amount of Internet user data that are valuable for advertising purposes are not within Facebook's exclusive control. Facebook now has until the end of January to respond to the EC's charge sheet. "We respect the commission's process and are confident that a full review of the facts will confirm Facebook has acted in good faith," Facebook said. "We've consistently provided accurate information about our technical capabilities and plans, including in submissions about the WhatsApp acquisition and in voluntary briefings before WhatsApp's privacy policy update this year." It added: "We're pleased that the commission stands by its clearance decision, and we will continue to cooperate and share information officials need to resolve their questions." Vestager warned at the start of this year that she was eyeballing US tech giants that hoard vast amounts of user data.
She said that following close scrutiny, Google's acquisition of DoubleClick and Facebook's buyout of WhatsApp both got the go-ahead, adding that data issues did not, and should not, be linked only to investigations into alleged privacy abuses. However, her concerns about the lack of clarity around how much data is being used by online services, such as messaging apps and video-streaming sites, clearly left the commission flat-footed given that it has only now spotted an alleged discrepancy with Facebook's takeover of WhatsApp. This post originated on Ars Technica UK
The newly disclosed attack involved sensitive user information, including unencrypted security questions. How this will affect buyout by Verizon is anybody's guess. Exactly what Yahoo and its pending new owner, Verizon Communications, did not want to s...
Microsoftreader comments 7 Share this story At the start of this year, Brussels' antitrust chief Margrethe Vestager warned data-hoarding tech giants that she was looking at them very closely—even though she was yet to spot a "competition problem." In June, Microsoft—with its planned buyout of LinkedIn—caught the eye of the Dane, who has been examining whether the £18.5 billion ($26.2 billion) deal should clear a regulatory hurdle in the 28-member-state bloc. On Wednesday, a spokesperson at Vestager's office—which has been looking at the business activities of the two firms to determine whether the proposed merger could be bad for competition—confirmed to Ars that it had "received a commitments proposal" from Microsoft and LinkedIn. It comes after Salesforce boss Marc Benioff, who had reportedly been considering a takeover of LinkedIn before Microsoft stepped in, told Recode that he had pushed the US Federal Trade Commission to probe the proposed merger.

The deal has already received regulatory clearance Stateside, however. He claimed that Microsoft's play for LinkedIn was an anticompetitive swoop on the data pumped into business productivity software.

And Benioff has apparently made his feelings known to Vestager.
It's understood that Salesforce submitted a response to a European Commission questionnaire, which sought views from interested parties who may have been concerned about LinkedIn being wedded to Microsoft. In October, the EC said: "On preliminary examination, the commission finds that the notified transaction could fall within the scope of the Merger Regulation. However, the final decision on this point is reserved." Salesforce foreshadowed its submission to the bloc's competition boss in late September, when its legal chief Burke Norton argued: "By gaining ownership of LinkedIn’s unique dataset of over 450 million professionals in more than 200 countries, Microsoft will be able to deny competitors access to that data, and in doing so obtain an unfair competitive advantage." Vestager's office is now looking at Microsoft's so-called "commitments proposal," and will seek the views of the company's rivals. Her spokesperson told us that "the new decision deadline is 6 December." Microsoft declined to comment on the makeup of its concessions package to the commission when quizzed by Ars. This post originated on Ars Technica UK
WikimediaOracle v.

Google The Google/Oracle decision was bad for copyright and bad for software How Oracle’s fanciful history of the smartphone failed at trial Google’s fair use victory is good for open source Op-ed: Oracle attorney says Google’s court victory might kill the GPL Google beats Oracle—Android makes “fair use” of Java APIs View all…Google successfully made its case to a jury last month that its use of Java APIs in Android was "fair use," and the verdict rejected Oracle's claim that the mobile system infringed its copyrights. After Google argued its case, though, Oracle filed a motion arguing that the judge should decide as a matter of law that fair use didn't cover it.
In the wake of the jury's pro-Google verdict, Oracle's motion was its last hope of a trial victory. It didn't happen. US District Judge William Alsup shot down the motion on Wednesday.

The same order also denied Google's motion making similar arguments, filed at the close of trial but before the jury's verdict. Alsup's stinging order [PDF], which rejects Oracle's argument [PDF] on every front, hardly comes as a surprise.

But the document provides the first insights as to what Oracle might bring up in an appeal proceeding, which the company has said it will pursue.
In the order, Alsup defends how he ran the trial.

The evidence and instructions presented to the jury were a mix of mandates from the appeals court, which overruled Alsup on the key issue of API copyrightability, and modifications urged by both sides' lawyers. "The final jury charge culminated an exhaustive and iterative process of proposals by the judge followed by critiques by counsel," Alsup wrote. He then goes on to dismantle Oracle's suggestion that its case was so strong that the jury's verdict should be disregarded. "Oracle has portrayed the Java programming language as distinct from the Java API library, insisting that only the language itself was free for all to use," Alsup writes. He continues: Turns out, however, that in order to write at all in the Java programming language, 62 classes (and some of their methods), spread across three packages within the Java API library, must be used. Otherwise, the language itself will fail.

The 62 “necessary” classes are mixed with “unnecessary” ones in the Java API library and it takes experts to comb them out.

As a result, Oracle has now stipulated before the jury that it was fair to use the 62 “necessary” classes given that the Java programming language itself was free and open to use without a license. Oracle's argument boils down to saying that it was okay to use the language, and okay to use the 62 "necessary" classes, but that Google "should have scrambled the functionalities among a different taxonomy of packages and classes." That would have required programmer to learn two different systems of "structure, sequence and organization," or SSO, the judge noted.

The jury could reasonably have found that such a division "would have fomented confusion and error." "By analogy, all typewriters use the same QWERTY keyboard—imagine the confusion and universal disservice if every typewriter maker had to scramble the keyboard," Alsup wrote. The judge proceeds through the four-factor fair use analysis, in which Oracle argues that no reasonable jury could have sided with Google on any of the four points.

As to the first factor, the nature of the use, it was Oracle that requested to bring forth evidence of Google's alleged bad faith, Alsup noted. Mental state is a "classic question reserved to the jury," and was hotly contested. Alsup says the jury could have reasonably concluded that at least the declaring code and SSO were free to use.

That evidence was backed up by Google testimony, as well as that of ex-Sun Microsystems CEO Jonathan Schwartz, who testified that everything Google did was standard industry practice. "Oracle’s harsh cross-examination focused on character assassination and showing that Schwartz resented Oracle for its treatment of Schwartz after the buyout," writes Alsup. "That Oracle resorted to such impeachment underscores how fact-bound the issue was, another classic role of a jury to resolve." It doesn't get any better for Oracle as the order goes on.

As to factor two, the jury could have concluded that the  "functional considerations" dominated the API design process. With regard to the amount of the work used, the jury could have reasonably concluded that Google's copying of a "tiny fraction of one percent" of the copyrighted works represented the "bare minimum...to preserve inter-system consistency in usage." Finally, the jury was reasonable to decide that Android "caused no harm" to the market for the copyrighted work, which was Java Standard Edition, built for use on desktop and laptop computers. As for Java Mobile Edition, it was in decline "before Android was even released," and the jury could have determined Android had no negative impact "beyond the tailspin already predicted within Sun." More from the Oracle v.

Google trial: Read the Ars Technica explainer on the trial's significance Jury selection took place on Monday, May 9 Lawyers gave opening statements for Oracle and Google on May 10 Ex-Google CEO Eric Schmidt testified on May 10 and 11 Ex-Sun CEO Jonathan Schwartz told jurors he had no problem with Android on May 11 Android chief Andy Rubin testified on Thursday May 12 Top Android programmer Dan Bornstein testified on May 13 and May 16 Google expert Owen Astrachan discussed APIs and fair use on May 16 Oracle CEO Safra Catz testified on May 16 and May 17 Sun's top Java architects and Oracle's expert spoke to the jury on May 17 Sun's Java licensing execs, an Apache programmer, and an economist testified May 18 Jurors heard Alphabet CEO Larry Page and Google's rebuttal case on May 19 Closing statements for Google and Oracle took place May 23 (see Oracle's visuals) The jury returned a verdict in Google's favor on May 26
NEWS ANALYSIS: At its EMC World conference, the company talked up its revised corporate structure and new products aimed at helping enterprises make the transition to hybrid clouds. Is it EMC's technology or the organization that's evolving? You could find proponents of both arguments at this week's EMC World technology conference May 5-8 in Las Vegas. EMC, the mothership, has been partially spinning off companies with the goal of aligning itself with the social, mobile and cloud trends rattling through the enterprise space. Now, the trick is to reassemble VMware, Pivotal, RSA and the re-energized pieces of EMC without hindering the individual companies and while offering products and services to its big enterprise customers that are striving to compete with agile startups that are Web-savvy from the get-go. The theme of this year's event is "Redefine," and that is exactly what the traditional tech vendors and their customers need to accomplish or risk being the Digital Equipment Corp. (which was held up in a couple of presentations here as a stellar tech company that fell off the cliff) of the current era. Jeremy Burton, the newly promoted president of products and marketing for EMC's core information infrastructure business, described the federated model as "alignment on strategy but free to operate independently." That alignment will be important as EMC strives to provide a software-driven technology architecture that automates provisioning for server, storage and network resources while providing the development environment geared to agile, mobile and cloud-based applications. Last year's EMC World was based largely on promises that the company was going to catch up to the mobile, social, cloud world unfolding for big Web-scale companies and adroit startups. This year's conference was more about delivering on the promises. The need to deliver was underscored by customer stories regarding the requirement for a tool set to match the nimble startups. The list of new products and services introduced at this year's show is long. But most of them buttressed EMC's claim that the hybrid model for enterprise computing melding on-premises services with public services is the model that most of the larger enterprises will adopt. The EMC strategy seems firmer than rivals IBM and Microsoft, which continue to redefine their cloud offerings. The product introductions at EMC World included the Product Nile on-premises cloud storage appliance renamed the Elastic Cloud Storage appliance. EMC notes its appliance is based on commodity storage devices and claims that the appliance approach in larger configurations offers up to a 28 percent total cost of ownership advantage over Amazon's and Google's public cloud storage offerings. The appliance uses the new version of EMC's ViPR storage control and data plane management. The company also acquired the secretive flash storage startup DSSD founded by Andy Bechtolsheim, co-founder of Sun Microsystems. The acquisition adds to EMC's solid-state memory offerings even as the company claims it sold more than 17 petabytes of flash capacity in the 2014 first quarter. Aligning the product and service sets of VMware, Pivotal, RSA and EMC is a substantial undertaking, but EMC has a strong record of successful acquisitions. EMC's buyout of VMware in 2004 is widely seen as one of the most successful corporate acquisitions in the technology industry. In discussing the EMC federation, Burton said the combination of the companies' services will help spur an essential restructuring of the role of corporate IT departments. Restructured IT departments will be able to accomplish four goals: provide access to all applications and data through mobile devices; use agile development to build new customer-centric applications; create a "data lake" to deliver greater corporate insights in real time; and enable the transition to a software-defined data center that's been transformed into a hybrid cloud capable of using outside services, but also able to respond to the new evolving security threat landscape. Eric Lundquist is a technology analyst at Ziff Brothers Investments, a private investment firm. Lundquist, who was editor-in-chief at eWEEK (previously PC WEEK) from 1996-2008, authored this article for eWEEK to share his thoughts on technology, products and services. No investment advice is offered in this article. All duties are disclaimed. Lundquist works separately for a private investment firm, which may at any time invest in companies whose products are discussed in this article and no disclosure of securities transactions will be made.  
Open WhisperSystems' TextSecure update takes some cues from WhatsApp's functionality, but more importantly it frees messaging from traditional SMS networks while still sending messages between phones. February 24, 2014 4:52 PM PST The new TextSe...
The hedge fund firm, which recently made a bid to buy Riverbed, is urging Juniper executives to reduce costs and review their product portfolio. Juniper Networks is the latest networking vendor to catch the eye of Elliot Management, which a week ago put in a $3 billion bid to buy WAN optimization solution provider Riverbed Technology. Officials with the activist investment firm, which owns about 6.2 percent of Juniper's common stock, outlined in a statement Jan. 13 and a presentation several steps that the networking vendor should take, including possibly ditching its security business, re-evaluating its switching and router strategies, slowing its acquisition initiatives, cut operating expenses by $200 million and buy back $3.5 billion worth of stock. The moves would push the company's stock price to $35 to $40 a share, up about 70 percent of the current price, according to Elliott Management officials. Echoing their views on Riverbed's situation, Elliott officials said Juniper has solid products and a strong reputation in the market, but that its stock is underperforming and the company should take advantage of having a new CEO on board to make these changes. "Juniper's new CEO along with its existing management team and Board have a unique opportunity to immediately unlock significant value at the Company through three straightforward and much-requested courses of action," Jesse Cohn, portfolio manager at Elliott, said in a statement. A spokesman for Juniper said in an email that the company "welcomes the opinions and insights of its shareholders and is always open to constructive input toward the goal of enhancing shareholder value." Juniper in November 2013 named Shaygan Kheradpir, a former executive with financial services provider Barclays, as its new CEO, replacing Kevin Johnson, who four months earlier announced his intent to resign after a successor was found. Elliott officials see the change in leadership as a chance to sway the direction of the company. One of those steps is reviewing parts of its portfolio, including its security business. Elliott officials in their presentation said the business is underperforming, and that it's also lacking leadership now that Bob Muglia, executive vice president of Juniper's software unit, resigned in December. In addition, Elliott officials said Juniper executives "overpromised and underdelivered" on its QFabric technology, which was introduced in 2011 and designed to reduce the number of networking layers in the data center from three to one.

The hedge fund operators noted that Juniper had seen little return on its $100 million, two-year investment in QFabric, and that in the intervening time, competitors like Cisco Systems, Brocade and Avaya have introduced their own fabric solutions. Juniper officials in October 2013 unveiled MetaFabric, a networking solution aimed at both corporate data centers and cloud computing environments that integrates a number of products in the company's portfolio, including QFabric. Overall, Juniper has been unable to gain much market share since entering the switch market five years ago, Elliott officials said. In streamlining the finances and cutting $200 million in expenses, the head fund operators said Juniper executives should look at squeezing costs from such areas as research and development and salaries.

The company also should consider not making any more acquisitions to focus more on executing on current strategies, Elliott officials said. Juniper has a market cap of about $12.87 billion. The hedge fund firm made headlines last week when it announced a plan to buy Riverbed, which had been the subject of buyout rumors for several months.

Again, Elliott officials praised Riverbed's technology and products, but questioned whether company officials had done enough to increase Riverbed's value to stockholders. Riverbed executives had met with Elliott in November and December to hear the hedge fund firm's recommendations, and Elliott officials noted there also had been "significant" interest in acquiring Riverbed from several parties, including them. However, they were concerned that Riverbed executives did not show enough interest in those overtures.  
NEWS ANALYSIS: When you understand that you can't stop all attacks, but you can detect and remediate them before they do serious harm, the value proposition of Mandiant becomes apparent. Security is one of the great market segments of the technology world as it's not typically driven by seasonality or cyclical demands. Security needs are constant and evolving. Simply put, no enterprise on the planet can afford not to invest continuously in security—for fear of being attacked and embarrassed in a public breach. It's in that context that security vendor FireEye acquired security firm Mandiant this week for the sky-high sum of $1 billion in stock and cash. On the surface, $1 billion seems like an absurdly high price for a company that has only 500 customers. It's also somewhat ridiculous that FireEye, a company that generated $160 million in revenue for all of 2013, is paying so much and has the ability to do so. Looking into the details of the transaction, FireEye will pay $106.5 million in cash and issue 21.5 million shares and options to Mandiant, so in a very real sense, Mandiant employees are buying into FireEye, as well. It's also important to remember that when it comes to company valuations, it's the future value and earnings potential that is paramount, rather than just simply looking at current revenue. Mandiant's "secret sauce" is a combination of threat-intelligence capabilities as well as the ability to understand how and where a company has been breached. During a call with financial analysts Jan. 2 to discuss the deal, Mandiant founder Kevin Mandia said that he started the company in 2004 on the premise that security breaches are inevitable. Although that premise wasn't widely accepted in 2004, in 2014 it is, and that's why Mandiant is a valuable commodity. When you understand that you can't stop everything, but you can detect and remediate attacks before they do serious harm, the value proposition of Mandiant becomes very apparent. What's also interesting to note is the connection between Kevin Mandia and FireEye CEO Dave DeWalt. Prior to founding Mandiant, Mandia was a director at Foundstone, which in its day was an influential security vendor. Foundstone was acquired by McAfee in 2004 for $86 million in cash. Coincidentally, DeWalt served as the CEO of McAfee from 2007 until 2012. In some respects, Foundstone can be seen almost as a precursor to Mandiant.

As such, it's incredible to see the amazing jump in valuation over the last decade for such technologies from $86 million in 2004 to $1 billion in 2014. In the modern threat economy, time is money and so is intelligence. As nation-states, hacktivists and cyber-criminals all continue to attack targets big and small, the value of security technologies and the vendors that build, support and service them will only grow in the years ahead. Sean Michael Kerner is a senior editor at eWEEK and InternetNews.com. Follow him on Twitter @TechJournalist.