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The five critical patches were included among eight bulletins that Microsoft released as part of its Patch Tuesday. The bulletins covered a total of 10 vulnerabilities.

Microsoft also issued a critical Windows patch for vulnerabilities in its VBScript and JScript Scripting engines, which could provide attackers with access to users’ systems and allow them to install programs, as well as view and change data.

One of the five critical patches is designed to resolve a flaw in Microsoft Office Project, which could allow attackers to take complete control of users’ systems if they open a malicious Office Project file.

A second critical patch is designed to tackle GDI (Graphics Device Interface) vulnerabilities in Windows that could allow attackers to remotely execute malicious code if users open malicious EMF or WMF image files. Two years ago, Microsoft faced similar vulnerabilities, forcing the software giant to rush out a fix outside of its monthly patch cycle, noted Dave Marcus, security research and communications manager at McAfee Avert Labs.

“We live in a Web 2.0 world,” Marcus said. “It’s getting more and more popular to send people e-mails with link spam…It’s becoming an effective way to compromise people’s machines.”

This security flaw, along with two Internet Explorer-related vulnerabilities are at the top of the list as a must fix, Marcus said.

One of the security bulletins is a cumulative patch for IE, and the other is designed to resolve vulnerabilities in ActiveX Kill Bits. Both flaws affect users who visit malicious Web sites with IE, which, in turn, allows malicious attackers to execute remote code from their systems.

Microsoft on Tuesday issued five “critical” security patches designed to address vulnerabilities in Windows,
Microsoft Office, and Internet Explorer.

Under the Wayport deal, AT&T will not only be getting additional hot-spot locations, but also its back-office management provider for its existing footprint of AT&T hot-spot locations. This will bring its Wi-Fi infrastructure entirely under its own roof.

With the acquisition, AT&T will increase its total Wi-Fi network to about 80,000 locations worldwide, 20,000 of which will be in the United States.

The telecommunications giant, which is the official U.S. wireless provider for Apple’s popular
iPhone, last week announced that iPhone users will get free Wi-Fi access at all of its hot-spot locations. AT&T did not immediately respond to a request for comment regarding the free usage of the Wayport hot spots to iPhone users.

AT&T expects to close the deal as early as this current quarter.

The acquisition will expand AT&T’s network of U.S. hot spots, adding locations at hotel chains such as Wyndham, Marriott Vacation Club, and Four Seasons, as well as health care facilities of HealthSouth and Sun Healthcare.

AT&T will also find itself serving Wi-Fi at McDonald’s restaurants via the deal, giving it extensive exposure to a wide swath of consumers and rivaling its presence at Starbucks coffee shops, which can be found on virtually every corner in major cities.

AT&T announced plans on Thursday to acquire Wi-Fi network provider Wayport in a $275 million cash deal.

“We’re seeing exponential growth of Wi-Fi-enabled devices, such as smartphones, combined with a continued dependency on 24-7, anytime, anywhere Internet access across business and consumer market segments,” John Stankey, chief executive of operations for AT&T, said in a statement.

Correction: This post incorrectly stated the number of hot spots Wayport would contribute to the AT&T network, as well as the overall pricing for use of those hot spots. Including Wayport, AT&T will now operate approximately 20,000 hot spots in the United States, free only to customers of certain plans.

Verizon, which plans to use the new spectrum to build its 4G wireless broadband network, initially opposed the open access rules. And once the rules were adopted, it filed a lawsuit with the U.S. Court of Appeals for the D.C. Circuit to find those conditions unlawful. It eventually withdrew its appeal after that court denied Verizon’s request for an expedited review.

“What a surprise,” he said in an e-mail. “Google submits yet another regulatory filing to the Federal Communications Commission. Google’s filing has no legal standing.”

Whitt said that what Verizon is doing with the Open Device Initiative is commendable. He applauds the company’s efforts to embrace openness as a business model, but he said that it’s too early to tell if the initiative will live up to the rules that the FCC has mandated for C Block licenses in the 700MHz spectrum auction.

Google, which also bid on the spectrum during the auction, was one of the main proponents of the open access rules and helped effectively lobby the FCC to include the rules as part of the auction.

Verizon has not specifically said since the auction that it won’t live up to its obligations under the rules of the auction. Whitt said that Google doesn’t necessarily mistrust Verizon, but he said that the company is taking Ronald Reagan’s advice to “trust but verify” that Verizon will do what’s expected.

“We want Verizon to acknowledge their responsibility to comply with the C-Block license conditions,” said Richard Whitt, the Washington telecom and media counsel for Google who signed the petition. “In other words, we want them to live up to their side of the bargain. And we want their interpretation and implementation of the rule to be consistent with the spirit and intent in which the FCC adopted those rules.”

Verizon Wireless was the winning bidder in the auction of an important sliver of spectrum licenses in the 700 MHz spectrum auction, which raised a record $19.6 billion for the U.S. Treasury. As part of the rules of the auction, the winner of the C-Block licenses is required to allow any device to connect to the network and is also required to allow any application to be downloaded on devices that use the network.

Now that the auction is over, Google claims that it wants to make sure that Verizon will really comply with the rules so that software developers can begin working on new innovative applications. It wants Verizon to state publicly that it plans to adhere to all aspects of the open access rules, including a provision the company opposed in written and oral arguments to the FCC as well as in court papers filed with the U.S. Court of Appeals. Specifically, Google wants Verizon to say that it will allow any application to be downloaded on any device using the C-Block network.

If Verizon responds to the petition and reiterates its position or decides not to address the issues, it will be up to the FCC to decide what it will do next. It is within the FCC’s right to deny Verizon access to the licenses, Whitt said. But considering what is at stake, it’s likely that won’t happen. I’ll be following this drama as it unfolds to see how Verizon responds.

This reasoning appears to be similar to how Verizon has set up its Open Device Initiative, a program announced in November that will expedite the certification process for device makers to get new devices on Verizon’s network. This program is separate from the 700MHz rules, but it could provide some insight into how the company interprets open access.

According to FCC procedure, Verizon has an opportunity to file its reply to Google’s petition within the next two weeks. A spokesman for the company said it would be doing that, but he didn’t seemed alarmed by Google’s petition.

Google filed a petition with the FCC on Friday asking the agency to make sure that Verizon really plans to adhere to these rules before the FCC officially grants the company the licenses in the C-Block of the 700MHz auction.

“We’re not trying to delay the process,” he said. “And we aren’t trying to block Verizon from getting those licenses. What it comes down to is we want to make sure that Verizon Wireless acknowledges and accepts the conditions put on these licenses by the majority of the FCC.”

Google contends that Verizon has argued previously that the rule should apply only to devices that consumers bring to the network and should not include devices that Verizon sells to its customers.

Google wants reassurance from Verizon Wireless that it will comply with open access rules that were part of the Federal Communications Commission’s recent 700MHz auction.

“In this environment, the combination of meeting current expectations but also reaffirming their outlook is an incredible performance,” he said. “You made my evening,” he told Reuters.

Big Blue said its year-to-date free cash flow was approximately $6.4 billion at the end of the quarter and its cash balance was $9.8 billion.

Click here for ongoing coverage from CNET News, ‘Tough times for tech’

IBM said earnings per share were at $2.05 for the quarter, up 22 percent from the same period last year. Net income rose 20 percent to reach $2.8 billion, while revenue rose 5 percent to $25.3 billion.

“For companies to be reaffirming their outlook through the end of the year is h-u-g-e,” Mike Holland, chairman of investment company Holland & Co., told Reuters.

“It is very nice to see some positive news, not just for IBM but for–to a degree–the tech space overall, given the downdraft we have seen in recent weeks,” Chuck Jones, a technology analyst for Atlantic Trust Private Wealth Management, told Reuters.

While much of the tech sector is bemoaning a sluggish economy, Big Blue sees blue skies ahead. IBM on Wednesday announced positive preliminary earnings for the third quarter of 2008.

IBM is also optimistic about results for the rest of the year. In its statement, the company reaffirmed its outlook for the full year, saying it continues to expect earnings per share of at least $8.75 for the fiscal year 2008, showing growth of 22 percent over 2007.

IBM says it will offer more details in its regularly scheduled Webcast, which is planned for October 16.

Microsoft opted to try to harness the Web to accompany its desktop monopoly, but the Web is too big to serve as handmaiden to any one company’s monopoly. Microsoft needs to learn to serve the Web, not the other way around.

Years later, as Joe Nocera eloquently opines in The New York Times, Microsoft has tethered itself to its Windows operating system and almost certainly lost its way on the Internet as a result:

“The die is cast,” declared Julius Caesar, anticipating Microsoft’s fateful decision to protect its Windows cash cow at all costs.

commentary

Windows is already dying a death by a thousand cuts. Yes, Microsoft still makes billions by selling pre-installed Windows via computer manufacturers. But ever-so-gradually, the Internet is upending its business model just as surely as it has upended models for the music, television and newspaper businesses….Bill Gates saw this coming many years ago…. But in the subsequent decade-plus, the company has been unable to keep it from happening. Think about it: do you really care anymore which operating system you use?

The more Microsoft seeks to protect its past (i.e., desktop monopoly and all the revenue that comes with it), the less relevant it will be to the future. Microsoft hopes to straddle the two, and maybe it will succeed. But its desktop anchor may well end up sinking the ship.

Microsoft’s Photosynth is an impressive tool for stitching together dozens of photos to allow a place or event to be viewed from multiple angles.

The only hard part is it really takes 75 photos or more to get the optimal experience. That’s a lot of work for one photographer. But, with big events, one can also rely on crowdsourcing. Which is what CNN has done with the inaugural, asking viewers to send in their photos of Barack Obama’s swearing in.

The resulting Photosynth is pretty cool. (It requires Silverlight for viewing.)

(Credit:
CNET News)

Microsoft's Photosynth creates an interactive 3D panorama from multiple still images. CNN used the technology to re-create Obama's inauguration.

What’s the coolest Photosynth you have seen? Post a link below so we can all enjoy.

For Microsoft, it marks a high-profile showcase of Photosynth and what the technology can do. I expect to see other news organizations use it for other events, particularly sports.

“While the Circuit City board has confidence in the company’s ability to successfully implement its turnaround plan and generate shareholder value, we believe that we can best serve the interests of our shareholders by exploring all possible alternatives to enhance shareholder value,” Circuit City CEO Philip Schoonover said in a statement. “Let me be clear that our decision to allow Blockbuster and Carl Icahn to conduct due diligence should not be taken as an indication that the board has completed its review of the Blockbuster proposal, that the board has taken a position on the company’s value, or that it has settled upon a particular strategic course of action.”

The struggling company recently became the target of a roughly $1 billion takeover bid from movie rental giant Blockbuster. Circuit City said Friday it has received a letter from Blockbuster responding to Circuit City’s request for information concerning Blockbuster’s ability to successfully finance its proposal and to secure shareholder approval.

Blockbuster’s letter included a note from Carl Icahn, a Blockbuster director and its largest shareholder. The note stated that, assuming his satisfaction with the due diligence review, he and his affiliates “stand ready” to purchase Circuit City if Blockbuster can’t secure financing or shareholder approval. Circuit City officials said they will grant that due diligence.

Circuit City has retained Goldman Sachs to help it explore “strategic alternatives to enhance shareholder value,” the electronics retailer said Friday.

For several years, YouTube has been a disruptive force in film and television. Now music poobahs are wondering what designs Google may have on their businesses. Three of the four largest recording companies are in talks to renegotiate music-licensing deals with Google’s YouTube. Sony Music is very near to inking a YouTube agreement, say my industry sources. Meanwhile, YouTube has reportedly started to generate “tens of millions” for some of the labels.

Not only that, Google at this point doesn’t possess the licensing rights to the music libraries from all four major labels. YouTube and Warner Music Group failed to reach a new licensing agreement and Warner’s content has been removed from the site.

Google’s appeal as a digital jukebox is first that it’s free of charge to users and that many people are so familiar with the site. The site enables fans to embed songs on their blogs or Web sites and provides an easy and legal way to share music. If someone wants to send a song to a friend, they can just e-mail a link to the song’s YouTube video.

For Google, one of the main challenges is executing a new music ad model. Two music industry sources say that Google has done only a lackluster job of selling ads against music videos and other label content. Another hazard is in negotiating with the labels.

More than 1 million G-1 units were sold in 2008, the year it was launched. Apple has raised its mobile music stake by enabling
iPhone owners to download music via cellphone networks.

At the same time, the music store Amazon.com created on Android, Google’s mobile-phone operating system, is leading to big music sales. Google declined to provide numbers or to comment for this story, but my sources say that the labels are “very happy” with Android’s songs sales. In addition, Google could one day tap into a huge market by helping people discover and buy music using search, according to Susan Kevorkian, an analyst with research firm IDC.

But in terms of influence, matching what the old record moguls accomplished isn’t that hard to imagine.

For example, Warner Music pulled out of talks with YouTube after Google reps declined to fork over upfront money, my music sources said. All three of the other labels receive advances but Warner doesn’t. The reason is Warner agreed to forgo an advance back in 2006 when it signed its original deal and YouTube wants to maintain those terms.

Google’s name is on the lips of music industry powerbrokers.

Google’s G-1 cell phone could become an even more powerful music platform than YouTube–that is if the phone continues to attract consumers.

Google needs to drive more music revenue
Where things could get sticky for the labels is if they hand too much power to Google. They don’t want Schmidt to be able to dictate to them the way that Apple CEO Steve Jobs (registration required) has for the past few years.

Studies show that sales of mobile music will skyrocket in the next two years. Songs purchased via handsets will reach $7.3 billion by 2011, nearly equal to that of digital downloads, according to a report from eMarketer. Together, they are expected to make up 56 percent of total music sales.

Of course, there’s Apple. Anybody selling music, either downloads or the ad-supported kind, must consider Apple their biggest competitor. Apple’s iTunes appears on pace to sell 2 billion songs a year.

The top music labels are seeing big music sales from Google's G-1 mobile phone.

Google’s a powerful music distributor
Let’s start with YouTube. Worldwide visitors to the site now number more than 100 million per month. Of the top 20 all-time most viewed clips at the site, 12 of them are music videos. The most watched YouTube channel belongs to Universal Music Group, the largest of the four top record labels. And YouTube has become one of the most popular ways to share music legally.

No one is saying, of course, that Schmidt will be hanging gold albums on his office wall or moving to Hollywood. For one thing, Google isn’t in the business of promoting talent or producing records. For another thing, the company hasn’t produced the kind of revenues that would put it on par with the likes of iTunes or even Amazon, according to one music industry source.

Perhaps the biggest question is whether anybody wants Google to have a grip on videos, music, news, books, photos… all our media?

Incredibly, Google CEO Eric Schmidt, a lifelong technologist, could find himself becoming an accidental music industry titan, a sort of digital-age David Geffen or Ahmet Ertegun. Google, of course, has many challenges ahead of it before executives there wield that kind of influence. Geffen and Ertegun, after all, were two of the most powerful label bosses ever.

YouTube is trying to capitalize on the popularity of music videos by posting click-to-buy links near the videos that lead to Amazon or Apple’s iTunes. Google declined to provide sales numbers for the ads.

This is all mostly good news for the major labels. They need to find new distribution models as record stores disappear. They need competitors to iTunes, which has become too powerful for some in the music business. They need to have a strong presence in mobile music sales.

(Credit:
CNET Networks)

For example, Google could post “click-to-buy” links when someone keys a song title into Google’s search engine, Kevorkian said. The company could also conceivably use its search engine to suggest songs or alert people to local music events.

Microsoft's next version of high-end Windows, dubbed Windows HPC Server 2008, is available in a feature-complete release candidate and is due for a final release this fall.

While Windows is ubiquitous on the desktop and well represented in the server racks, until recently it has been nearly absent from the world’s largest supercomputers.

But although Top 500 results are nice, Hilf said perhaps more important is the potential for HPC Server 2008 to allow cluster computing to move further beyond government and university labs and into corporate departments where the massive computing power can be used for things like fraud detection.

(Credit:
Microsoft )

Hilf said it’s this release that will really make Windows suitable for clusters with more than 1,000 separate servers. “We weren’t ready to fully take on most of those,” he said.

The first big fruits of that effort were evidenced in this year’s top 500 list of the world’s biggest supercomputers. Five of those on the list were Windows clusters, including one at the National Center for Supercomputing Applications that ranked No. 23.

Starting several years ago, though, Microsoft made a concerted effort at this part of the market, creating a separate version of Windows solely for computing clusters.

Updated 3:12 p.m. to correct the number of the highest ranking Windows cluster

Of course, that still leaves 495 that aren’t running Windows at all.

But, it’s significant progress, says Bill Hilf, who once set up Linux clusters for IBM but now oversees Windows Server marketing efforts. He says to expect further gains in the top 500 as Microsoft comes out with its next version of high-end Windows. That release, dubbed Windows HPC Server 2008 and now available in a feature-complete release candidate, is due for a final release this fall.

“This code of conduct would be one important step toward our shared goals of promoting freedom of expression and protecting the privacy of Internet users around the world,” Durbin said in a press release.

The letters were addressed to Durbin, Chairman of the Human Rights and the Law Subcommittee, and Sen. Tom Coburn, the Ranking Member of the Subcommittee, after the senators inquired in a letter dated July 21 about the progress of the code of conduct. The subcommittee held a hearing on the issue in May.

The impending Olympic games have increased questions about Internet censorship in China, especially after Chinese officials tried to block journalists there for the games from accessing certain sites, even after the Chinese government assured reporters they would have full freedom to search the Internet, unlike its citizens.

Click here for more stories on tech and the Beijing Olympics.

Just days before the Olympic torch will reach Beijing, Internet leaders Google, Yahoo, and Microsoft say they are close to an agreement on a code of conduct for doing business in China and other countries that censor the Internet.

Those components, the letters say, include principles for promoting freedom of expression and privacy, implementation guidelines, and an accountability framework. The specifics of the code are now being reviewed by the individual organizations involved. Google said the companies are working toward “a set of clear and rigorous principles, such that restrictive governments would be unable to ignore or reject these best practices on freedom of expression and the protection of individual privacy.”

The companies began work on the code, in conjunction with human rights groups, privacy advocates, and European companies Vodafone and France Telecom, in January 2007. A year earlier, politicians railed against the companies for complying with China’s censorship practices. Yahoo was especially criticized for handing over the identity of journalist Shi Tao to Chinese officials, who sentenced the writer to 10 years in prison.

Sen. Dick Durbin on Monday released separate letters from the companies, stating they have “reached agreement on the core components of the principles” of the code, as Google put it.

Google’s letter said that the search giant will not provide the Chinese government with “any sensitive personal information regarding American athletes, journalists, and tourists who use the Internet while they are in China during the Olympics other than required by United States law.” According to the Yahoo letter, CEO Jerry Yang personally asked Secretary of State Condoleezza Rice to bolster diplomatic efforts in the name of human rights, particularly before the Olympics. (The Microsoft letter is viewable here.)