IBM dumps server unit on Lenovo -- EBAY spinning off PayPal? -- Obama panel: NSA phone collection worthless, illegal -- Protesters visit GOOGLE engineer home


January 23, 2014 06:00 PST | 09:00 EST | 14:00 UTC

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>> BREAKING: Lenovo to buy IBM server unit for $2.3 billion amid PC slump: "Lenovo, the world's largest maker of personal computers, will buy International Business Machines Corp.'s server business for $2.3 billion. The deal price includes about $2 billion of cash and the rest in Lenovo stock... The purchase of IBM's x86 server business includes System x, BladeCenter and Flex System blade servers and switches. The price for the hardware server unit is higher than any previous Lenovo acquisition." Bloomberg

> Lenovo agrees to buy IBM's low-end server business for $2.3B, will hire 7,500 of its staff: "The agreement will see IBM keep hold of some of its related assets." TNW

> "The deal between Lenovo and IBM could face hurdles before it is completed. U.S. regulators could review any acquisition by a Chinese company of a U.S. business linked to critical technology or national security" Wall Street Journal

> IBM dumps its server business on Lenovo for $2.3B TechCrunch

>> LIBERTY & JUSTICE: Independent review board says NSA phone data program is illegal and should end, by Ellen Nakashima: "An independent executive branch board has concluded that the National Security Agency's long-running program to collect billions of Americans' phone records is illegal and should end. In a strongly worded report to be issued Thursday, the Privacy and Civil Liberties Oversight Board (PCLOB) said that the statute upon which the program was based, Section 215 of the USA Patriot Act, 'does not provide an adequate basis to support this program.' ... The divided panel also concluded that the program raises serious threats to civil liberties, has shown limited value in countering terrorism and is not sustainable from a policy perspective. 'We have not identified a single instance involving a threat to the United States in which the telephone records program made a concrete difference in the outcome of a counterterrorism investigation,' said the report.... 'Moreover, we are aware of no instance in which the program directly contributed to the discovery of a previously unknown terrorist plot or the disruption of a terrorist attack.'" WaPo
> Microsoft offers overseas data storage in response to NSA concerns
The Verge

>> BAD APPLE: Apple promises to fix iOS 7 'white screen of death', by Adario Strange: "The 'white/black screen of death,' a bug that abruptly soft reboots the smartphone will finally be addressed in a future iOS 7 update... The update is rumored to land alongside iOS 7.1, which is currently in its fourth beta with developers." Mashable

>> PITCHFORKS & TORCHES: Protesters show up at the doorstep of Google self-driving car engineer, by Cyrus Farivar: "After arriving at the Berkeley home of Anthony Levandowski on Tuesday morning, the protesters distributed a flier (PDF) complaining of his role in developing Google Street View and, more recently, his spearheading a new condominium development in downtown Berkeley. Protesters say this development is linked to a design firm that has done work for the US military." ArsTechnica

>> CRIMES & MISDEMEANORS: Foxconn senior management arrested for alleged millions in kickbacks, by Liu Jiayi: "Taiwan has arrested around a dozen managers at Foxconn on suspicion of soliciting several million U.S. dollars in bribes from iPhone parts suppliers, according to a Tencent report on Wednesday... In order to qualify as a supplier for Foxconn, iPhone parts suppliers reportedly had to pay 2.5 percent in kickbacks and had to bribe again to secure orders... There are also allegations that [retired Sr VP Liao Wancheng] abused his influence in Foxconn after his 2011 retirement and raised the rate even further to 3 percent, keeping the extra 0.5 percent in his own pocket." ZDNet

>> FADE TO BLACK: Nokia says Lumia & other phone sales declined in Q4 as it prepares to sell division to Microsoft, by Natasha Lomas: "In what is likely to be Nokia's last quarterly earnings before it hands off its mobile phone making business to Microsoft, the Finnish mobile maker has reported lower sales of Lumia devices in its Q4. The company also reported an operating profit of 408 million Euros -- but based mainly on its NSN equipment business. So the decision to cut lose its mobile phone making business looks to be vindicated by these results." TechCrunch
> The Windows 8 tragedy continues with Windows Phone sales falling InfoWorld
> Benedict Evans: Nokia has sold about 44m Lumias since launch. Apple sold slightly more iPhones last quarter. More Androids are sold every 3 weeks.

>> MICROSOFT MISCHIEF: Leaked Windows 8.1 Update 1 screenshots point to more tweaks to aid desktop users, by Mary Jo Foley: "Known leaker WZor posted on January 22 screenshots which appear to be from a build of the Windows 8.1 Update 1 release which sources have said will be out around the time of Microsoft's Build 2014 conference in early April... screen shots indicate that users will be able to pin Metro-Style/Windows Store apps on the desktop taskbar. It's not clear whether clicking on a Metro-Style app from the desktop taskbar would open and run that app on the desktop or take users back to the Metro environment." ZDNet
> TechBrief notes that a simple Win8 program makes it easy to create such shortcuts now Guiding Tech
> Windows 8.1 Update 1 preview: Now with more integration: 'Metro apps will now include a close box, similar to that seen on desktop applications, which can be clicked with a mouse so that the app closes completely.' WinSupersite
> Windows 9 rumors freeze corporate Windows 8 uptake Windows XP hangers-on have no reason to ever deploy Windows 8 NetworkWorld

>> BUG SPRAY: Chrome bugs allow sites to listen to your private conversations, by Tal Ater: "By exploiting bugs in Google Chrome, malicious sites can activate your microphone, and listen in on anything said around your computer, even after you've left those sites. Even while not using your computer - conversations, meetings and phone calls next to your computer may be recorded and compromised." Tal Ater blog
> Google dismisses eavesdropping threat in Chrome InfoWorld

>> RIP PC: Spam doesn't lie: American consumers desert PCs for most mundane chore, by Gregg Keizer: "Traditional PCs were used at historically low rates last quarter to open emails, another sign that a longtime task of those notebooks and desktops has been hijacked by mobile devices, an email-centric firm said today. U.S. consumers used a traditional personal computer to open only about a third of all the spam email they received, with the task shifting more to mobile... Americans opened just 35% of 'brand marketing messages' they received in the last three months of 2013 on a personal computer. That was a record low... down from 39% the previous quarter." Computerworld

>> INVISIBLE HAND OF CAPITALISM: YouTube deal was a 'typical marketing partnership,' say Machinima and Microsoft, by Samit Sarkar: "The advertising arrangement between Microsoft and Machinima under which Machinima paid a bonus to YouTube producers who highlighted the Xbox One was a 'typical marketing partnership,' said Machinima and Microsoft in a joint statement issued to Polygon. Under the deal, Machinima offered a $3 CPM bonus (an extra $3 per thousand views) to individuals who posted videos on YouTube that featured at least 30 seconds of Xbox One gameplay footage and verbally mentioned the game was being played on an Xbox One. The videos could not contain anything negative about the Xbox One, its games or Machinima. It appeared that the terms of the agreement prevented those video producers from mentioning that they were being paid to promote the Xbox One, but according to the statement from Microsoft and Machinima, that's not the case." Polygon
> Microsoft did not pay video bloggers to promote Xbox One WindowsITPro
> Electronic Arts also paying YouTubers to promote games Ars Technica

>> STAT DU JOUR: Netflix beats analyst expectations with 2.3M new domestic subscribers, earnings of 79 cents a share, by Ryan Lawler: "The most-watched number every quarter is Netflix's domestic subscriber growth. On that front, the company added 2.3 million domestic subscribers in the quarter, bringing the total to 33.4 million. Netflix's own forecast had between 1.6 million and 2.4 million domestic subscribers, or between 32.7 million and 33.5 million for the year... Netflix hopes to continue its momentum into the new year, as the first quarter will bring along more original programming. The second season of House of Cards debuts February 14, as well as new seasons of Derek, Hemlock Grove, Orange is the New Black, Lilyhammer, and The Killing." TechCrunch
> Netflix warns ISPs against 'draconian' response after Net neutrality ruling InfoWorld
> Netflix wants to introduce three pricing tiers for new members GigaOM

>> SHOT: TiVo lays off most of its design team as it transitions to the cloud, by Roberto Baldwin: "TiVo has been bullish lately about releasing new software products beyond its core DVR boxes. Today, we found out why. The company laid off nearly all the industrial designers of those products. According to sources within TiVo, most of the hardware team has been let go. So far, that's five employees. A skeleton crew of two engineers has been retained to handle support for current and upcoming third-party devices. The sources told Wired that TiVo is getting out of the hardware business altogether and making a big direction change." Wired
>> CHASER: TiVo exiting the hardware business? Not so fast, says TiVo, by Harry McCracken: "[TiVo VP of PR Steve] Wymer called me and said 'We're investing a ton into Roamio [the current TiVo line] and are working on new features and services for's just not right to say we're exiting the hardware business.' ... Me, I'm in no hurry to see the company's boxes go anywhere. Roamio is the best DVR I've ever used, and the company also has a fine iOS app which basically turns an iPad into a TiVo. I still use a TiVo every day to record stuff which isn't readily available elsewhere, from talking-head news programs to the 1960s Adam West version of Batman." Time

>> WASHINGTON WIRE: U.S. Supreme Court: Burden of proof of infringement on patent holder, by John Ribeiro: "The U.S. Supreme Court has upheld that it is up to the patent holder ordinarily to prove infringement in a lawsuit, a ruling that could have vast implications on the litigious technology industry." InfoWorld
> Judge: IP-address does not prove copyright infringement TorrentFreak

>> GEEK ALERT: Snapchat makes you "find the ghosts" to keep hackers from stealing your phone number [Update: But it fails], by Josh Constine: "Snapchat now verifies new users aren't robots by making them choose its ghost mascot within images. It's an attempt to keep out hackers who could steal phone numbers by exploiting a leaked database of details on 4.6 million accounts. a 16-year-old hacker proved he could do just that by finding the number of Snapchat CTO Bobby Murphy, but now he says Snapchat has patched the holes he harnessed. [Update: But the 'Snap-tcha' solution doesn't seem very secure as another hacker built a workaround in under an hour.]" TechCrunch
> Hacking Snapchat's people verification in less than 100 lines Steve Hickson's blog

>> Red Hat refreshes private cloud stacks for the enterprise InfoWorld

>> Compuware unveils Hadoop solution on AWS ARN

>> Fast-growing database startup MemSQL raises $35M GigaOM

>> Intercom raises another $23M for its new, more social approach to CRM TechCrunch

>> eBay dismisses Icahn proposal to spin off PayPal Reuters

>> Early stakeholders in Scout Analytics claim venture capitalists engaged in 'self dealing, corporate waste' prior to $32M acquisition GeekWire

>> Beyond virtualization: Why VMware bought AirWatch InfoWorld

>> Facebook tests ads in third-party mobile apps, works directly with advertisers as a mobile ad network TNW

>> Prim: Anatomy of a folded startup Fortune

>> Windows 8 developers are shunning Windows JavaScript ZDNet

>> Microsoft's new Rethink campaign tries to convince developers and users that Internet Explorer advances the Web TNW

>> Dell's Surface Pro 2 rival appears at Microsoft Store Cnet

>> Engineer nets Facebook's biggest bug bounty, but not the jackpot he hoped for PCWorld

>> Intel's toughest year starts now InfoWorld

>> Pear OS has been bought out by an undisclosed company, and all free versions of the OS have been removed Linux User

>> HAD TO RUN IT: Old Spice is back with another set of viral things -- this time, it's prank websites TechCrunch

>> BITCOIN: $931 Mt.Gox

>> TWEET O' THE DAY: "If you pore through Google Public Data Explorer you can see the seeds of future resource conflicts, and economic shifts. It's all in there." @novaspivack

FEED ME, SEYMOUR: Comments? Questions? Tips? Shoot mail to Trent or Woody. Follow @gegax or @woodyleonhard.

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