Chinese hackers targeted Morgan Stanley in 2009
Investment bank ‘hit hard’ by six-month strong attack on its network, within weeks of attack on Google
Morgan Stanley suffered a “very sensitive” break-in by the Chinese computer hackers who attacked Google last year, according to leaked emails from an internet security firm working for the investment bank.
The emails, which were sent by California-based HB Gary Federal, detail how Morgan Stanley was “hit hard” by a six-month strong attack on its network in June 2009 – within weeks of the attack on Google by Chinese hackers.
George Kurtz, chief technology officer for security firm McAfee which investigated the so-called “Operation Aurora” attacks, described it as the “largest and most sophisticated cyberattack we have seen in years”.
An email sent by Phil Wallisch, a senior security engineer at HB Gary Federal, which provided internet security for Morgan Stanley, said: “They [Morgan Stanley] were hit hard by the real Aurora attacks (not the crap in the news).
“They have given me access to a very sensitive report on their Aurora experience,” Wallisch said in an email to a colleague in May last year. “I will honor their wishes about not sharing the info with anyone, but the good news is that I have some great ideas for our final reports.”
The HB Gary Federal emails were made public in the wake of an attack by online collective Anonymous. The emails did not reveal what information may have been stolen from Morgan Stanley.
Morgan Stanley declined on Monday to comment specifically on the Operation Aurora attack. A spokeswoman said: “Morgan Stanley invests significantly in IT security and manages a robust programme to deal with malware and attempted computer compromises.”
A senior member of China’s communist politburo organised the hack into Google, according to leaked classified information sent by US diplomats in China to Hillary Clinton’s state department, revealed by WikiLeaks.
Google made public the “highly sophisticated and targeted attack” last January, shortly before the hackers shut down their operation. The attack, which involved “more than 20 other US companies”, was partly aimed at the Gmail accounts of “Chinese human rights activists”.
Classified diplomatic cables sent by the US embassy in Beijing, and released by WikiLeaks in December, alleged that a leading Chinese politician had “coordinated” the assault on Google, which the Americans claimed was “100% political in nature”.
The attack caused Google to abandon mainland China and sparked a global diplomatic row about internet censorship.
Hillary Clinton, the US secretary of state, renewed her calls for China and other countries to adopt common standards for internet use, which includes removing barriers to access.
• Booby-trapped adverts hit visitors to the London Stock Exchange (LSE) website on Monday. The ads, which the LSE said were provided by a third party, caused some users’ computers to crash – with one victim claiming his machine became unusable after landing on the site. The LSE site has been involuntarily hosting computer viruses on around 363 pages in the last 90 days, according to an analysis by Google.
Technology news, comment and analysis | guardian.co.uk
Hackers send obscene emails from university database
St George’s University email list breached with messages claiming board involved in ‘child pornography sting’
The Metropolitan police has been called in after computer hackers gained access to a London university medical database, sending a string of expletive-laden emails to hundreds of its users.
Unidentified hackers sent emails last week pretending that members of the university’s executive board were involved in a “recent child pornography sting” and warned the database was “closed due to Aids”.
The database, which is run by St George’s University of London medical school, is an online directory for doctors and nurses across the UK. It does not hold medical records.
The Met and the university have launched separate investigations into the attack on the Primary Care Electronic Library [PCEL] database.
A spokeswoman for St George’s University confirmed to the Guardian that the email list had been “compromised” by hackers and described the emails as “extremely offensive and unfounded”.
“A number of unsolicited emails were consequently sent to members of the list. We are currently investigating how access was gained to the subscription list,” the university said.
“We would like to assure anyone who received one of these emails that they were not sent by any member of the PCEL team. The content of these emails was extremely offensive and unfounded, and we apologise for any offence caused to those who received these emails.
“This was an isolated incident, affecting the PCEL server only, which runs independently of the St George’s University of London (SGUL) main server. No SGUL data, including confidential details of SGUL staff, students or partners, was compromised as a result of this situation”.
The first email, which was sent on 15 February and has been seen by the Guardian, said: “Dear PCEL user, if you were ever once a patient of ours, we regret to inform you that the Primary Care Electronic Library is closed due to AIDS. Thank you for your attention.”
The following day, the hackers sent three more emails to the site’s baffled users. The first said: “Dear PCEL user, You’re all cunts. Fuck yourself.”
Moments later, another message appeared to confirm that the database was hacked and asked users to disclose their login details and password.
The hackers then sent a final email. It said: “Dear PCEL user, Due to the Administrative Board’s involvement in the recent child pornography sting, all PCEL resources and administrative offices will be closing at 24 February, 2011 at 4:00 pm GMT.
“We advise all members to quickly withdraw their memberships as to avoid unnecessary payments which will be caused by the closing procedures.”
Technology news, comment and analysis | guardian.co.uk
Apple report reveals increase in use of child labour
Apple’s annual report says 91 children worked at its suppliers in 2010, and 137 workers were poisoned by n-hexane
Apple found more than 91 children working at its suppliers last year, nine times as many as the previous year, according to its annual report on its manufacturers.
The US company has also acknowledged for the first time that 137 workers were poisoned at a Chinese firm making its products and said less than a third of the facilities it audited were complying with its code on working hours.
Apple usually refuses to comment on which firms make its goods, but came under increased scrutiny last year following multiple suicides at electronics giant Foxconn, one of its main suppliers.
Last month, anti-pollution activists accused the firm of being more secretive about its supply chain in China than almost all of its rivals.
The report says Apple found 91 children working at 10 facilities. The previous year it found 11 at three workplaces.
It ordered most to pay the children’s education costs but fired one contractor which was using 42 minors and had “chosen to overlook the issue”, the company said. It also reported the vocational school that had arranged the employment to the authorities for falsifying student IDs and threatening retaliation against pupils who revealed their ages.
Apple said it had strengthened its checks on age because of concerns about the falsification of ages by such schools and labour agencies. It also audited 127 facilities last year, mostly for the first time, compared with 102 in 2009.
The report shows a marked decrease in compliance on working hour requirements of a maximum 60-hour week with one day off. In 2009, only 46% met the standard; last year that fell to 32%.
Only 57% were compliant with its code on preventing working injuries and 70% or fewer met standards on air emissions, managing hazardous substances, and environmental permits and reporting.
But there were some signs of improvement in other areas. Compliance on wages and benefits improved from 65% in 2009 to 70%.
The report also says that 137 workers at a Suzhou supplier were poisoned by n-hexane, a hydrocarbon, last year. Previous reports had indicated 62 employees were affected and Apple had declined to answer repeated queries about the incident.
A spokesperson said it had “provided more transparency” regarding the company and Foxconn given recent concerns.
The report said Apple was “disturbed and deeply saddened” by the Foxconn deaths. Apple’s chief operating officer, Tim Cook, and other executives went to Shenzhen to see the facilities and the firm commissioned an independent review of conditions.
“I think it is positive that after such a long delay Apple has finally acknowledged the [n-hexane] problem,” said Ma Jun of the Institute for Public and Environmental Affairs, one of the organisations that criticised the US firm last month.
But he added: “This report shows that Apple is still not ready to accept public scrutiny … We have listed the names of some Apple suppliers but there is no mention of them [here].”
Debby Chan, of Hong Kong’s Students and Scholars Against Corporate Misbehaviour campaign, said there was no way for others to monitor the behaviour of suppliers because Apple would not identify them or even say how many it had.
“I regard this report as a means of image-building rather than ensuring compliance with labour rights,” she added.
Apple said that immigrant workers in countries such as Malaysia had been reimbursed .4m (£2.1m) in “exorbitant” recruitment fees since 2008 thanks to its checks. It has also increased efforts to crack down on the use of potential conflict minerals and expanded social responsibility training.
It is unusual in publishing its audit report and said 40% of the facilities audited last year said Apple was the first company to check them for social responsibility compliance.
The report also said that 99% of facilities met its freedom of association requirements.
But independent unions are not allowed on the Chinese mainland and Geoff Crothall, of Hong Kong’s China Labour Bulletin, said: “It is Henry Ford-style freedom of association: You can have any union as long as it is [in] the Associated Federation of Trade Unions.”
Last month, Apple reported record profits of bn for the fourth quarter of 2010.
Technology news, comment and analysis | guardian.co.uk
Filesharing prosecutions will face ‘serious problems’
Digital Economy Act under more scrutiny after senior judge highlights problems with copyright claims
A senior court judge has pointed to severe problems with the way the Digital Economy Act enables copyright owners to prosecute people accused of illegal filesharing.
Judge Birss QC said on Tuesday that the process of connecting copyright infringement to a named individual based on their use of an internet address is fraught with difficulties because internet connections, or IP addresses, are often used by more than one person.
In a ruling in the Patents county court, Birss asked: “Does the process of identifying an IP address in this way establish that any infringement of copyright has taken place by anyone related to that IP address at all?”
He said that the assertion did not hold up: “Even if it is proof of infringement by somebody, merely identifying that an IP address has been involved with infringement [does not make it] clear to me that the person identified must be infringing one way or another. The fact that someone may have infringed does not mean the particular named defendant has done so.”
The use of “unsecured” internet connections which allow others to “piggyback” on their network leads to more complications, Birss said, adding that these issues are “key” in proving copyright infringement before a court of law.
That could create serious problems for copyright owners seeking to enforce their rights under the Digital Economy Act. Although the law allows for a “three strikes” provision in which internet service providers (ISPs) would be required to write to the people who are using an IP address at a time that it is found to be infringing, it has not yet been implemented. Beyond that, copyright owners might be able to take people to court or demand that their internet connection is throttled or constrained.
But Birss pointed to a lack of case law to support the idea that someone in charge of an IP address could be judged guilty of infringement carried out through that address.
“What if the defendant authorises another to use their internet connection in general and, unknown to them, the authorised user uses P2P [peer-to-peer] software and infringes copyright?” he noted in his ruling.
“Does the act of authorising use of an internet connection turn the person doing the authorising into a person authorising the infringement within s16(2) [of the Copyright, Designs and Patents Act]? I am not aware of a case with decides that question either.”
The BPI, which represents record labels in the UK, has successfully prosecuted a number of people in the UK after showing that they were using P2P software and downloaded files from them which it could present as evidence. However no such evidence was presented in the cases being considered by Birss, and it is not clear that the Digital Economy Act requires that level of evidence either for ISPs which are asked to write letters to alleged infringers.
The ruling relates to 27 cases of alleged illicit filesharing brought by ACS:Law and the copyright licensee MediaCAT, could have implications for the Digital Economy Act. Under the act, the UK’s largest internet service providers will send warning letters to internet users whose IP addresses are linked to illegal downloading, and anyone who receives three letters in 12 months could be sued by the copyright owner.
ACS:Law, the controversial law firm at the centre of a huge row over illegal downloading and data protection, on Tuesday had its attempt to discontinue lawsuits against 27 people it suspected of illegal downloading quashed by the court.
Birss said that the letters demanding payment from alleged infringers “materially overstates the untested merits” of the companies’ approach to proving illicit filesharing. These cases are the first to be taken to court from the tens of thousands of letters sent out by ACS:Law on behalf of MediaCAT.
ACS:Law and MediaCAT shut down their respective operations last week, just days before today’s key court decision.
The two companies have 14 days to involve the copyright owners in the 27 proceedings; otherwise the cases will be dropped and the claimants liable for outstanding legal costs.
Michael Forrester, a solicitor at the Manchester-based law firm Ralli which is representing five of the 27 defendants, said: “The judgment highlights a number of legal and technical difficulties with these cases which we had advised our clients of throughout.
“We are dealing with cases where consumers have explained how they cannot possibly have uploaded or downloaded copyright protected material, but they are still being pursued.”
Technology news, comment and analysis | guardian.co.uk
Microsoft: Yahoo Mail is devouring data allowances
The software giant’s newest foray into the smartphone market gets off to a bad start after a blogger outs its search partner Yahoo as the cause of 50MB/day data consumption. But why only WP7?
Microsoft has been forced to named the culprit that has been chewing through data allowances for the owners – all X of them (where 0 <= X <= 2,000,000) – of Windows Phone 7. It’s Yahoo Mail.
The discovery was made by blogger Rafael Rivera, who applied some packet-sniffing to WP7 data. Discovering the flaw was no trivial hack (unless you find writing nodejs scripts to strip the STARTTLS bit off IMAP packets trivial), but eventually he surfaced with the discovery that “Yahoo’s IMAP server (winmo.imap.mail.yahoo.com) does not respond to FETCH requests correctly.”
In brief, “Yahoo is sending about 25 times as much data as it needs to.”
Rivera’s advice:
“To workaround this, I strongly recommend Yahoo mail users reconfigure the phone to not transmit data via a cellular connection (Settings –> Cellular –> Data roaming options). As an alternative, you can set your Yahoo account to only Download new content only on manual trigger (Yahoo Mail –> Settings –> Sync Settings).”
Microsoft was thus forced to admit that yes, Yahoo (its BFF in search) is at fault. “We have determined that an inefficiency exists in the synchronization of email between the Windows Phone Mail client and Yahoo! Mail,” it wrote.
Last month Microsoft said that it had identified the culprit – but didn’t want to name the app that had been consuming as much as 50MB per day. The lack of naming dismayed people, since it didn’t give them any clues on how to avoid it. Aside from returning their Windows Phone 7 phone to their retailer, obviously. Without the overhead, the data use would have been a much more manageable 2MB/day, for example.
Yahoo is one of the three biggest email providers on the web, with an estimated 270m users, behind only Microsoft’s Hotmail in size. That means that WP7 owners are almost certain to also have a Yahoo Mail account.
A fix will be rolled out in “coming weeks” – though Windows Phone 7 owners have already been waiting in some cases since October for an update to the OS, and Microsoft has not given a date for the fix. (Some rumours suggest that a major carrier, possibly in the US, has been blocking the upgrade; if true, it will do WP7′s, and Microsoft’s, reputation no good. But we emphasise that it’s not confirmed.)
In a statement, Microsoft said it had determined an “inefficiency in the synchronisation of email between the Windows Phone Mail client and Yahoo Mail”. It also “identified an issue” with its Exchange ActiveSync [EAS] email synchronisation protocol, which affects Microsoft Outlook and Google Gmail.
The result: mail gets stuck in the outbox if a user exceeds the mail server email size. Again, an update will be issued in a “near-term end user update”.
It’s inconceivable that Microsoft has only just found this out at the same time as Rivera. It seems quite likely that it knew about it when it acknowledged the “third party” problem in January – and, since the data-chewing nature has been bruited about since October, it should have been picking this up much sooner.
This is a very bad start for Windows Phone 7: user sales are unknown (but reported by retailers and networks to be “slow”), Microsoft has not rolled out the expected update that would bring expected functionality such as cut/copy/paste and other functions, and it has not been forthcoming with users who have put their faith in it about problems that it must have known about.
Better must follow, or worse will follow; WP7 is already starting late in the race, and if it’s trying to put its trousers on at the same time then it will turn into an expensive rout.
Update: in my hurry to get this story written, I overlooked the completely obvious question: why is this only an issue for Windows Phone 7 phones? There are millions of smartphones out there which also connect to Yahoo Mail, but their owners aren’t complaining about enormous data usage.
A comment on Rivera’s post suggests that the iPhone gets just the same problem, but that it doesn’t see it because it only downloads 50 messages by default rather than WP7′s 200. That’s possible, but unlikely. The more likely explanation comes in the blogpost, where Rivera writes that “Yahoo’s IMAP server (winmo.imap.mail.yahoo.com) does not respond to FETCH requests correctly.”
The clue is in the prefix – winmo.imap.mail.yahoo.com. It’s set up by Yahoo to serve Windows Mobile phones, but these are WP7. That might be the clue. It seems unlikely that every other smartphone platform has had the same problem and yet solved it independently without anyone telling Microsoft (which should have dealt with it on Windows Mobile anyway).
So either Yahoo has messed up in how it treats WP7, or WP7 doesn’t do it right. Either still isn’t good.
Technology news, comment and analysis | guardian.co.uk
ACS:Law ceases claims against illegal filesharers
Law firm quits copyright litigations, claiming that staff have received death threats
The controversial London-based law firm which sent tens of thousands of letters demanding payment from people it accused of illegal filesharing has dramatically quit its copyright litigations, claiming death threats are causing “immense hassle” to the lead solicitor’s family.
Andrew Crossley, the founder and lead solicitor at ACS:Law, announced in a statement to the patents county court in London yesterday afternoon that his firm would no longer be chasing alleged copyright infringers.
“I have ceased my work. I have been subject to criminal attack. My emails have been hacked. I have had death threats and bomb threats,” Crossley said in the statement, read to the court by barrister Tim Ludbrook, who is acting on behalf of copyright licensee MediaCAT. “It has caused immense hassle to me and my family.”
ACS:Law is at the centre of a long-running row over its method of so-called “speculative invoicing”, where thousands of generic letters are sent to internet users it suspects of illicit filesharing. The Solicitors Regulation Authority is currently investigating its practices as hundreds of the accused claim to have been wrongly identified.
In September last year, the personal details of thousands of Britons were leaked online after a crippling attack on ACS:Law’s website. The details, including telephone numbers and addresses, surfaced online during a distributed denial of service (DDoS) attack on the company’s servers. The information commissioner is presently investigating the data breach and could levy a £500,000 fine if ACS:Law is found to have held the information insecurely.
Crossley’s revelation came at the close of yesterday’s patents county court hearing into 27 people accused of illegally sharing copyrighted pornography, of which MediaCAT is the exclusive licensee.
Of the thousands of letters that ACS:Law has sent out to alleged infringers, these 27 cases are the only ones to be heard before a judge. ACS:Law attempted to drop the cases just days before its first court hearing earlier this month, but was told that it first needed the court’s permission.
Judge Birss QC called the situation “absolutely extraordinary”, and said: “I am not happy about this. I get the distinct impression that at every twist and turn there is a desire to avoid judicial scrutiny.
“It seems to be first instinct to avoid judicial scrutiny. There’s been thousands of letters, and only 27 cases have had to be dropped – I doubt that. Copyright infringement is a serious matter, but this is just mindboggling.”
The protracted hearings have been further complicated by the recent emergence of a separate law firm issuing similar payment demands on behalf of MediaCAT, known as GCB Ltd. ACS:Law claims to have no connection with GCB Ltd, other than two of its former employees founded the newly established law firm.
Judge Birss said he had considered banning ACS:Law’s client, MediaCAT, from sending any more payment demands until its claims and claimants are clarified. “It would be an extraordinary order to make,” he added. “But these are extraordinary circumstances”.
The patents court is expected to rule later this week on whether ACS:Law should be allowed to discontinue the cases, and whether the copyright owner – understood to be Sheptonhurst, the owner of the UK’s biggest sex shop chain, Private – has to join proceedings as a claimant.
Technology news, comment and analysis | guardian.co.uk
Apple announces record profits of $6bn as Steve Jobs hails ‘phenomenal’ sales
Shares increase after Apple reports 7m iPads sold during Christmas quarter, as chief executive prepares to go on leave
Apple tonight reported record revenues for the second quarter in a row, with profits of bn and revenues of .74bn – up 77.5% and 70.5% respectively.
Shares had fallen at the start of today during early trading in New York, when stock markets reopened following Monday’s holiday and investors digested the news that Apple’s chief executive, Steve Jobs, was taking another open-ended period of medical leave. The break is his third since being diagnosed with a rare form of pancreatic cancer in 2004.
However, shares increased by 4% in after-hours trading, and the company announced that during the Christmas quarter it sold 7.3m iPads – as many as it sold in the previous two quarters – taking the total sold to 14.5m copies since its introduction in April. The iPhone also saw strong growth, with 16.24m sold in the most recent quarter – its best ever.
In a statement, Jobs said: “We had a phenomenal holiday quarter, with record Mac, iPhone and iPad sales. We are firing on all cylinders and we’ve got some exciting things in the pipeline for this year, including iPhone 4 on Verizon.”
The results were announced after markets closed, with Apple’s stock finishing the day down 2%, having earlier fallen by 4.1% to 4 in early trading.
Investors, meanwhile, are wondering about plans for a successor if Jobs is unable to return to the company, despite saying in his email to staff on Monday that he would continue as chief executive and be involved in major strategic decisions.
Tim Cook, the chief operations officer who stands in for Jobs during his absence, has been in the company since March 1998 and is viewed by Wall Street as a safe pair of hands. He ran the company for most of 2009 when Jobs received a liver transplant.
But questions are expected on whether Apple has enough new products and innovation in the pipeline to stimulate further growth. Though the iPad was designed and completed while Jobs was away, he is understood to have been closely involved in its development.
Richard Windsor, global technology specialist at Nomura, said: “Steve Jobs is seen by the market to be a major force in Apple’s strategic direction. If his pancreatic cancer has returned, one could be quite worried.”
Apple’s market value means that shifts in its stock price can pull down or lift the market. “The market’s reaction to Steve Jobs’s surprise medical leave from Apple today will underscore the importance of the tech sector on the S&P 500 … What happens next to Apple will therefore dominate what happens in the sector,” said Bryan McCormick, analyst at optionMonster.com.
Without new products, Apple’s growth would likely stall: sales of the iPod – that led Apple’s rapid growth in 2004 – are already in decline. Apple differs from Microsoft, which is able to rely on regular, substantial income from its Windows and Office monopolies to fund new ventures.
Despite the announcement about Jobs, analysts such as Kaufman Bros and Thinkequity raised their long-term forecasts for the share price, to 5 (up ) and to 0 (up ) respectively. Most analysts reckon the stock could still head towards 0, which would put it close to Exxon’s world-leading 2bn market capitalisation.
Observers have focused on an apparent rivalry in the mobile market between Apple’s iPhone and Google’s Android mobile operating system. But the signs are that Android is not weakening Apple; instead the two are taking market share in the US, particularly from RIM, the Canadian maker of the BlackBerry. Apple passed RIM for the number of phones sold in the US in the third quarter, and RIM is struggling to maintain market share.
The iPhone, meanwhile, is expected to receive a sales boost in the US after Verizon, the largest US mobile network, with 93.2m subscribers, announced last week it would begin selling Apple’s phones from the end of this month. That will be in addition to AT&T, with 89.8m subscribers, which has sold the device since its inception in June 2007.
In a conference call in 2009, Cook summed up Apple’s strategy: “We believe we’re on the face of the Earth to make great products, and that’s not changing. We believe in saying no to thousands of projects so that we can really focus on the few that are truly important and meaningful to us … Frankly, we don’t settle for anything less than excellence in every group in the company, and we have the self-honesty to admit when we’re wrong and the courage to change. And I think, regardless of who is in what job, those values are so embedded in this company that Apple will do extremely well.”
But questions remain over who would provide a strategic focus for the company without Jobs. The iPad and iPhone are viewed as being products of his vision. He is also seen as having been essential to the company’s success, notably in negotiating contracts with content providers such as record labels and film companies.
Technology news, comment and analysis | guardian.co.uk
MySpace confirms it is to cut 500 jobs worldwide
Struggling social network to halve headcount, while responsibility for UK ad and sponsorship sales will pass to Fox Networks
MySpace today confirmed it is cutting 500 jobs – nearly half its remaining staff – and handing over responsibility for UK advertising and sponsorship sales to sister News Corporation company Fox Networks.
It is understood that there will be significant job losses at the News Corp-owned social networking website’s London office, as 47% of all staff globally are cut.
MySpace has about 1,060 staff, with some 100 working for its international business in the UK, Germany and Australia and the rest in the US.
As part of the restructuring in London, responsibility for MySpace ad and sponsorship sales will pass to Fox Networks, the online division of Fox International Channels.
Some MySpace UK commercial staff are expected to transfer to Fox Networks, while others are likely to move to posts with MySpace International.
The MySpace chief executive, Mike Jones, said the “tough but necessary changes” would provide the company “with a clear path to sustained growth and profitability”.
Jones said the cuts did not reflect the performance of the “new MySpace”, referring to the operation’s most recent relaunch in October, but was “purely driven by issues relating to our legacy business”.
“We are also committed to rebuilding the company with an entrepreneurial culture and an emphasis on technical innovation. The new organisational structure will enable us to move more nimbly, develop products more quickly, and attain more flexibility on the financial side,” he added. “While it’s still early days, the new MySpace is trending positively and the good news is we have already seen an uptick in returning and new users.”
Jones said that outside the US MySpace would retain “a core, dedicated international team to work with partners in order to ensure users, content partners and advertisers continue to be served”.
MySpace was acquired for 0m (£360m) in 2005 by News Corp, which was keen to make it big in the burgeoning social space. But its success proved to be shortlived.
Although News Corp today insisted that the swathe of job cuts “in no way” reflected the performance of its repositioning as a “social entertainment” site, MySpace’s parent company has been running out of patience with it for some time.
Swingeing cuts were made to the MySpace workforce in June 2009, with 420 jobs axed in the US – about 30% of the company’s American staff – and about a third of the overseas workforce, totalling some 720. At least four of its international offices were closed.
But the ailing site has never shown signs of returning to its previous heights. Chase Carey, News Corp’s president, in November admitted that the once-booming social network was “a problem” for the company. Hinting that more cuts were ahead, Carey said its losses were “neither acceptable or sustainable” as they widened to 6m (£97m).
Speculation that MySpace was set for a sale has intensified since the October redesign and when Carey one month later said the site had quarters rather than years to turn around its fortunes. The CNBC business network reported earlier this month that a sale of the social network was on the cards for mid-2011, despite the predicted job cuts.
The rise of Facebook made the once-dominant MySpace look even more stagnant. Facebook overtook MySpace as the leading social network in the US back in May 2009, and last month attracted more than triple the number of global unique visitors, 154 million, according to the latest figures from metrics firm comScore.
• To contact the MediaGuardian news desk email editor@mediaguardian.co.uk or phone 020 3353 3857. For all other inquiries please call the main Guardian switchboard on 020 3353 2000.
• If you are writing a comment for publication, please mark clearly “for publication”.
Technology news, comment and analysis | guardian.co.uk
Facebook’s value swells to $50bn after investment
Deal underlines Facebook’s power and fuels rumours that Mark Zuckerberg is preparing a stock market flotation
Facebook has received a new round of investment that values the social media firm at bn (£32.3bn), making it worth more than Time Warner, eBay or Yahoo.
The funds from investment bank Goldman Sachs and its long-time Russian investor Digital Sky Technologies underlines the astonishing growth of the social networking site, started from a Harvard dorm in 2004 by Mark Zuckerberg.
Although it is yet to disclose a profit, the site’s popularity has investors lining up for a piece of the action. Goldman Sachs is believed to be setting up a “special purpose network” to allow its rich clients to invest in the firm, whose shares – which can be traded on private stock exchanges – have seen increasingly frenzied trading in recent months.
Last year Facebook beat Google to become the world’s most visited website, according to internet analyst Experian Hitwise. It accounted for 8.93% of all US visits between January and November 2010 and now has more than 500 million active users. Half of Facebook’s users come to the site at least once a day.
Zuckerberg, who last year became Time magazine’s man of the year and saw the release of a hit Hollywood film about his life, The Social Network, stands to become one of the richest people on the planet on the new valuation of the company. He owns around 25% of Facebook, and it is thought that a sale at the new price would double his estimated .9bn fortune.
Zuckerberg has brushed off rumours he is preparing to sell shares in the firm through a stock market flotation, telling a conference last year “don’t hold your breath”, when asked about it. But the new investment will fuel those rumours once more.
Under US law private companies with more than 500 shareholders have to disclose their financial results. The rule in part triggered Google’s decision to go public after similar interest from investors. The Securities and Exchange Commission (SEC), the US’s top financial watchdog, is already investigating the trading in shares of Facebook and other hot social media firms including Twitter and Zynga, maker of the popular Farmville game.
Facebook does not disclose its financial performance, though analysts estimate the company is profitable and had sales of bn last year, double those of 2009.
Colin Gillis, technology analysts at BGC Financial in New York said: “Fifty billion is a big number but right now there is only one Facebook. People pour their private information into Facebook for free, it’s an incredible platform for advertisers, and for games, and just look at that traffic.
“We haven’t seen anything like this for a very, very long time.”
Technology news, comment and analysis | guardian.co.uk
More than 3m UK children ‘have no internet access’
E-learning Foundation fears gap between rich and poor at school will widen unless more get home internet access
The following correction was made on Tuesday 28 December 2010
The original web headline for this article – More than 3m UK children have no internet access at home, warns charity – conflated two figures: 1m children are without computers and 2m are without internet access. This has been corrected.
————————————————————————————–
More than one million children in Britain live in homes without computers and a further two million have no internet connection at home, a charity said yesterday).
The e-Learning Foundation said it feared the gap between rich and poor pupils’ performance at school would widen unless more was done to ensure that every child can use a computer at home.
The charity works with teachers and parents to enable children without home computers to borrow them, or their families to buy them.
It found that the poorest families in the country were two-and-a-half times less likely to have an internet connection at home than the richest ones.
The charity analysed a survey of family spending in Britain, published by the Office for National Statistics last year. The study found that 75% of households had a home computer and 71% had an internet connection, a rise of three and five percentage points respectively on 2008.
In the richest 10% of homes, 98% had a home computer and 97% had internet access, but in the poorest 10% of homes only 38% had a home computer and 30% an internet connection.
Connection to the internet was lowest in Northern Ireland, where 57% of homes could log on, and highest in the south-east and London, where 72% of homes could access the internet.
Valerie Thompson, chief executive of the foundation, said children without computers and with no internet access at home were at a “tangible disadvantage” when it came to completing homework, pursuing their interests and researching topics for school. “Without the use of a computer and the ability to go online at home, the attainment gap that characterises children from low-income families is simply going to get worse,” she said.
One of the first acts of the education secretary, Michael Gove, was to announce that Becta, a quango that helped schools choose the most suitable technology, was to close.
The government said schools were best placed to make decisions about the resources they needed on their own.
Gove has cut £100m from a “harnessing technologyfund” that paid for new computers and broadband connections in schools. T The extent of the gap between rich and poor pupils was highlighted this month when government statistics showed 58.5% of pupils not eligible for free school meals achieved five A* to C grades this summer, including in English and maths, compared with 30.9% of pupils known to be eligible for free school meals. The gap – 27.6 percentage points – has only slightly closed over five years. In 2005, it stood at 28.1 percentage points.
Pupils in the most wealthy parts of the country were almost twice as likely to achieve five A* to C grades, including English and maths, as their peers in the poorest parts of the country.
Some 74.6% of pupils in the richest 10% of areas achieved five A* to C grades, including English and maths, compared with 35.8% of pupils in the poorest 10% of areas. The gap has narrowed by 3.1 percentage points on last year. A report commissioned by Becta last year found having a computer at home could enable children to improve their GCSE results by as much as two grades.
