Revenues from customers in Britain were diverted to Google Ireland Limited

Google, which has an estimated 90% market share of UK internet searches, last year used a cross-border network of subsidiary companies to ensure it did not pay a penny in corporation tax on its 1.6bn advertising revenues in Britain.

The international corporate structure enables Google to avoid paying what could otherwise have been a corporation tax bill in the UK of as much as 450m.

Recently filed accounts for subsidiary company Google UK Limited show none of the search engine's advertising revenues from British customers were accounted for in the business, despite operations in London and Manchester incurring "administrative expenses" of 177m last year, including a wage bill of 70m.

While much of the costs linked to the running of Google's British operations are recognised for tax purposes in the UK; revenues from customers in Britain, however, are diverted to another Google company in Ireland, where the corporation tax rate is between 10% and 25%. British corporation tax is levied at between 28% and 30%.

The accounts for Google UK describe its principal activity as "the provision of marketing services to Google Ireland Limited and the provision of research and development services to [US parent company] Google Inc".

As a result Google UK reports turnover of 150m and a pretax loss of 26m. By contrast, Google Inc's annual report showed 14% of the company's $21.8bn ( 13.5bn) revenues came from the UK, making it the largest market outside of the US.

Multinational companies engaged in so-called "transfer pricing" where expenses are booked in high tax jurisdictions and earnings in low tax areas are seen by many anti-avoidance campaigners as presenting one of the biggest challenges to the already strained exchequer.

Such transfer pricing arrangements must have the agreement of tax authorities in the UK and are entirely legal. They are commonplace in many industries other than advertising, from pharmaceuticals to bananas. Multinationals with significant intellectual property such as Google and Microsoft are particular well placed to transfer revenues to the most advantageous tax regimes because they are able to charge inter-group companies significant royalty payments.

Tax expert and anti-avoidance campaigner Richard Murphy said: "This indicates a pattern of tax avoidance by Google suggesting they are dedicated to minimising corporation tax on profits arising outside of the US."

Over the weekend, Vince Cable, deputy leader of the Liberal Democrats, urged Google to pay "its fair share" and warned that it risked damage to its reputation. "Avoidance like this is hard to stomach at the best of times, but when the country is in recession and everyone is feeling the pain, it really sticks in the throat it means higher taxes for the rest of us".

Google, which was built on a motto "don't be evil", said: "It would be wrong to think of Google's revenues from UK advertisers as solely the result of operations carried out locally. We invest in R&D, data centres and other infrastructure on a global basis, and that then helps generate revenue in different countries."

A spokesman pointed out that Google employs more than 800 staff in the UK, making a "substantial contribution" through payroll and other taxes. He added that Dublin was Google's European headquarters, pooling revenues from across the continent, not just the UK. He said the competitive tax environment was just one reason why Google, like many other multinationals, had chosen Dublin for its European base.

The smallprint of the 2008 annual report for Google Inc, which is registered in Delaware, reveals that despite the search engine's international reach, its two major tax jurisdictions are the US and Ireland. "We and our subsidiaries are routinely examined by various taxing authorities," it states, confirming Irish officials are examining tax years 2002 to 2008.

After a Facebook campaign against Simon Cowell's chart domination, music fans celebrate their victory

In recent years, it had become as predictable as elections in North Korea singer wins X Factor, singer's debut single goes to No 1. So when Joe McElderry won the TV talent contest, he was no doubt confident he would celebrate Christmas at the top of the charts.

Alas for the 18-year-old from South Shields, it wasn't to be: a song almost his own age denied him the top spot after a successful online campaign.

Killing In The Name, an expletive-heavy rock song first released in 1992 by the Californian rock band Rage Against the Machine, won the battle for Christmas top spot on the basis of downloads only. It sold about 500,000 copies last week, about 50,000 more than The Climb, McElderry's earnest ballad.

Depending on your view, the Rage victory was either a delicious dismantling of the X Factor Christmas No 1 juggernaut or a cynical assault on the festive charts. There was, though, some indignation when it emerged both records had links to Simon Cowell, the entertainment industry's favourite pantomime baddy. With the Rage track having been released by Sony, and McElderry's by Cowell's Syco, a Sony subsidiary, some claimed the high-waisted X Factor judge would emerge triumphant whichever act won the chart battle.

Rock fan's campaign

But arguably the real victor here was a rock fan from Essex who started a Facebook group a month ago with the (then) pie-in-the-sky idea of usurping the X Factor winner from the no 1 slot.

Jon Morter, 35, a part-time rock DJ and logistics expert from South Woodham Ferrers, near Chelmsford, decided it would be a bit of a giggle to start a campaign to encourage people to buy a record with pretty much the opposite vibe to the X Factor winner's ballad. While McElderry urges listeners to "keep the faith", the Rage track is best known for its now-ironic refrain: "Fuck you, I won't do what you tell me."

He had tried a similar wheeze last year, when he attempted to get Rick Astley's Never Gonna Give You Up to the top of the Christmas charts. Alexandra Burke, the 2008 X Factor winner, won that battle, but having succeeded in propelling Astley to "the lower echelons of the chart", Morter was emboldened to try again. This time, he was helped by the comedian Peter Serafinowicz, who on 15 December urged his 268,000-plus Twitter followers to join in, and it snowballed from there. By the time Paul McCartney and former X Factor winner Steve Brookstein had pledged their support, poor McElderry seemed doomed.

When the Guardian broke the news to Morter that he had won, he was initially lost for words. "Oh bloody hell," he said, as the consequences of what he had done became clear. Composing himself, he said: "I think it just shows that in this day and age, if you want to say something, then you can with the help of the internet and social networking sites like Facebook and Twitter. If enough people are with you, you can beat the status quo."

But doesn't he feel guilty about denying McElderry his first No 1? "Umm. no," he said. "Not really. At the end of the day he has had a Christmas no 2 with his debut single, which is still a phenomenal achievement."

Gracious in defeat

Morter, a big Iron Maiden fan, said the choice of a relatively obscure Miley Cyrus cover for McElderry's single helped the Rage campaign: "If he had released Don't Stop Believing [the Journey song McElderry sang in an X Factor heat] we would have been dead and buried."McElderry took his defeat graciously, saying: "Fair play to the guys who have organised the Facebook campaign it's been exciting to be part of a much-hyped battle and they definitely deserve congratulations. This time last year I never thought for one minute I'd win The X Factor, never mind having a single out. I'm just delighted to be in the charts."

Despite Cowell giving some pseudo-grumpy interviews, he phoned Morter on Saturday night to congratulate him on the campaign. "He commended us on how we had marketed the campaign, and said if we won, he would be the first to congratulate us," Morter said.

Rage Against the Machine have pledged to give all profits of the single to the homelessness charity Shelter, and will perform a free victory gig in the UK to thank those who bought their single.

McElderry is off on an Alpine skiing holiday to ponder his next move.

If you're struggling with 'infomania' and can't get any work done as a result, it may be time to declutter your inbox

Ping! Ever feel like you can't seem to knuckle down and focus on a task in hand because (Ping!) one email after another keeps unloading itself (Ping!) from your computer or handheld device?

A study found that a worker's IQ test score drops briefly by an average of 10 points when juggling phones, emails and other electronic messages a more pronounced effect than after smoking marijuana or losing a night's sleep. So if you spot the creeping symptoms of "infomania", what can you do to combat them?

Filter out unwanted email. Any email client worth its salt will have filters built in to exclude mail by sender, subject or recipient. Go through your inbox and weed out anyone who persistently sends you extraneous material. Googlemail has a great function called "Skip the inbox" which diverts certain email to a side folder where you can register its presence without it cluttering up your inbox. Spend half an hour setting up a few of these and watch your inbox clear magically.

Beat spammers at their own game. Don't fall for the biggest trick in the book and click on "unsubscribe" at the bottom of a marketing email. Spammers use this to work out if addresses are active, resulting in yet more spam.

Schedule unplugged times. Put aside certain times of the day, evenings or weekends where you will block out all incoming traffic: no phone, no computer, no PDA, nothing. Turn off your email when working on important projects, or set it to only check mail once an hour.

Keep to the point. The subject line is your headline, and the email's purpose should be clear in the first two lines. The action expected of the recipient should be explicit.

Cut out clutter by discouraging the sending of one-word "Thanks" or "OK" emails. An instant message or even shock horror a face-to-face greeting, would be better.

More than one site has been hit by the pro-Iranian hackers who briefly misdirected web traffic for Twitter to their own site

The "Twitter hack" by the "Iranian Cyber Army" turns out not to have been a hack of Twitter itself: instead they took aim at the DNS records for the site itself (though Twitter itself says in a blog post that API services - which contact the servers directly - were unaffected.)

The hackers also appear to have hacked mowjcamp.org, an advocacy site for Iranian protesters against the re-elected President Mahmoud Ahmadinejad.

I tried to contact the "Iranian Cyber Army" at the given (Gmail) address on the website: it bounced as undeliverable.

Rik Ferguson, a security analyst at Trend Micro, said: "This kind of DNS hijacking usually involves compromising the registrar responsible for the DNS records of the victim company. The attackers then make unauthorised changes to the DNS records. These changes mean that when you or I type a web site address into our browsers, we are directed not to the real web site but to a second site, set up by the hackers, in this case the 'Iranian Cyber Army'. This has the net effect of making it look like, in this example, servers belonging to Twitter were compromised when in reality that was not the case."

Similar misdirections have happened in the past by accident when "root servers" which route queries for domain lookups have been misprogrammed. Pakistan was blamed for making YouTube inaccessible to the world in February 2008. The government ordered ISPs to set up their DNS servers to reroute any queries inside the country for the site to an "inaccessible" message - but that block was then passed on to DNS servers around the world. (Update: altered to try to clarify that the Pakistan/YouTube incident was about routing tables, not DNS.)

However security experts know that DNS servers are a major source of weakness in the internet: because they determined how traffic is routed, control of them gives hackers the ability to send people where they like. In July 2008 researchers had to race to fix a flaw discovered in the DNS setup before hackers could exploit it.

Ferguson added: "These sorts of attacks are usually limited to hacktivism activities like this one today, but imagine the potential to criminals if they could pull this off against any site requiring log in credentials, such as PayPal, eBay, MSN, Facebook. One has to wonder how quickly the attack would be noted if the dummy site was an exact replica of the victim and was simply there to harvest credentials and redirect the user then into the real site."

Such attacks, called "pharming", presently happen on individual PCs that have been silently taken over by malware, not DNS compromises. But, warns Ferguson, "the potential is demonstrably there. If attacks like this can be said to serve any purpose at all, then perhaps they can serve as a reminder that we all need to absolutely ensure that our business partners meet our own high security standards, and that stands in both the on- and offline worlds."

Update: a translation of some of the text has been provided: "the red text says "Peace be with you. Ya Hossein!" (Hossein being the third imam in the Shia Islam hierarchy, this phrase is used as an exclamation, a bit like we might say 'Oh my god!')'.

'The lower text says "If the leader orders us to, we will attack and if he wants us to, we will lose our heads. If he wants us to have patience and wait, we shall sit down and put up with it."'

(We still don't know what the top part, in blue, says: that's Arabic not Farsi/Iranian, apparently.)

Intriguingly this site's content (the pic is from mowjcamp.org) is different from what was allegedly put on the Twitter misdirection: "U.S.A. Think They Controlling And Managing Internet By Their Access, But They Don't, We Control And Manage Internet By Our Power, So Do Not Try To Stimulation Iranian Peoples To . NOW WHICH COUNTRY IN EMBARGO LIST? IRAN? USA? WE PUSH THEM IN EMBARGO LIST ;) Take Care."

All through the printed paper notably in the G2 (tabloid) section on Thursdays, when we will have game reviews and the top 10 bestselling games chart (an innovation in print). We're aiming to produce more news stories and features for the main part of the newspaper. And at weekends there will be the Guide, with its usual page of unusual findings from the web, plus more reviews. And the Observer will also offer a fresh take on the topic (and a continuing place for technology stories).

The key place to find our technology coverage of course is online as has been the case for some years now, as we produce more than can be squeezed into a physical paper on most days.

The first place to start is with Twitter, where the @guardiantech account (twitter.com/guardiantech) has more than 1.5 million followers and provides links to every story produced across the Guardian that relates in any way to "technology" in its broadest sense whether that's people Twittering about the X Factor final, or how 3D engines are written, or the release of the Guardian's iPhone app (of which more later).

The next place, if you want to see a rolling version of those stories, is at our "all stories" page guardian.co.uk/technology/all where you will find a list of the stories; it's like Twitter but without the interaction.

If interaction is what you're after, though, the place to go to is the front page, at guardian.co.uk/technology where the news and features of the day are laid out for you. There are plenty of subdivisions for you to examine gadgets, the internet, computing but it's often the case that the busiest places are the blogs.

That's the Technology blog, at guardian.co.uk/technology/blog and the award-winning Games blog at guardian.co.uk/gamesblog and of course the PDA blog (which sits on the flourishing patch between media and technology) at guardian.co.uk/media/pda.

Ask Jack is still here to help with his own blog at guardian.co.uk/askjack for questions and answers.

But wait, there's plenty more. For those who want to know more about particular topics or companies Apple? Microsoft? Google? we have a huge range of "keyword" pages. So for example there's guardian.co.uk/apple and guardian.co.uk/microsoft and guardian.co.uk/google. Prefer news about mobile phones? guardian.co.uk/technology/mobilephones. And so on. Each has its own RSS feed so (this is left as an exercise for the reader) you can generate your own Twitter feed for them.

We would be remiss if we didn't remind you of the Tech Weekly podcast (you can figure out the frequency), which aims to enhance your world for half an hour: you can find it through guardian.co.uk/techweekly to listen directly or on an MP3 player.

And finally, there's the new platform for reading the Guardian, including the technology content: the iPhone app, available for 2.39 at the iPhone App Store. It works offline on iPod Touches too. Read on ...

The 100 most voted for games in this week's Games of the Noughties list.

A few readers have asked for this, so as an epilogue to an interesting week of discussion, here are the top 100 games that made up our Gamesblog Games of the Noughties list. As you'll see, plenty of favourites were bubbling just below the top 50, although still no room for Dwarf Fortress!

1. Half-Life 2
2. World of Warcraft
3. Fallout 3
4. Portal
5. GTA: San Andreas
6. GTA: Vice City
7. Resident Evil 4
8. Bioshock
9. Call of Duty Modern Warfare
10. Civilization 4
11. Deus Ex
12. Pro Evo Soccer
13. Baldur's Gate 2
14. Halo
15. Super Mario Galaxy
16. Elder Scrolls Oblivion
17. Ico
18. Shadow of the Colossus
19. Star Wars: Knights of the Old Republic
20. Football Manager
21. GTA 4
22. Elder Scrolls: Morrorwind
23. GTA 3
24. Mass Effect
25. Metroid Prime
26. Left 4 Dead
27. Rome Total War
28. Uncharted 2
29. Guitar Hero
30. Legend of Zelda: The Wind Waker
31. Advance Wars
32. Mario Kart Wii
33. Wii Sports
34. Gears of War
35. Metal Gear Solid 3
36. Okami
37. God of War
38. Medieval Total War
39. Prince of Persia: Sands of Time
40. Rock Band
41. Halo 3
42. LittleBigPlanet
43. Zelda Twilight Princess
44. Bejeweled
45. Final Fantasy XII
46. Gran Turismo 3
47. Metal Gear Solid 2
48. Team Fortress 2
49. Timesplitters 2
50. Call of Duty
51. Final Fantasy X
52. Diablo 2
53. Eternal Darkness
54. Halo 2
55. Jet Set Radio
56. Mario Kart Double Dash
57. Metal Gear Solid 4: Guns of the Patriots
58. Battlefield 1942
59. Silent Hill 2
60. SSX Tricky
61. Call of Duty: Modern Warfare 2
62. Demon Souls
63. Fable II
64. Gran Turismo 4
65. Killzone 2
66. Operation Flashpoint
67. Perfect Dark
68. Psychonauts
69. Shenmue
70. Sims
71. Super Monkey Ball
72. Batman Arkham Asylum
73. Dead Rising
74. Lego Star Wars
75. Rez
76. Street Fighter IV
77. Battlefield Bad Company
78. Beyond Good and Evil
79. Braid
80. Championship Manager
81. Counterstrike
82. Crackdown
83. Far Cry 2
84. FIFA 10
85. Gears of War 2
86. Katamari Damacy
87. Animal Crossing
88. Assassin's Creed 2
89. Burnout 3 Takedown
90. Crazy Taxi
91. Dead Space
92. Dragon Age Origins
93. Fable
94. Fahrenheit
95. Far Cry
96. God of War 2
97. Max Payne
98. Mirror's Edge
99. New Super Mario Brothers
100. Quake III Arena

Scientific research and medical breakthroughs increasingly depend on huge computer power

HOW DO YOU predict whether a given patient is likely to die from a heart attack? Conventional medical wisdom would base a risk assessment on factors such as the person's age, whether they were smokers and/or diabetic plus the results of cardiac ultrasound and various blood tests. It may be that a better predictor is a computer program that analyses the patient's electrocardiogram looking for subtle features within the data provided by the instrument.

A team of researchers at Massachusetts Institute of Technology and the University of Michigan analysed a large data-set of 24-hour electrocardiogram recordings collected at a Boston hospital as part of a clinical trial for a new drug. Employing a number of computational techniques involving algorithms for signal processing, data mining and machine learning, the researchers developed a way to analyse how the shape of the electrical waveform varies, a measure they dubbed morphological variability. At the heart of the approach are mathematical techniques used in speech recognition and genome analysis which allow researchers to compare individual beats. "We compute the differences for every pair of beats," reported one of the researchers. "If there is lots of variability, that patient is in bad shape."

The team then applied their algorithm to a second set of electrocardiogram recordings and found that patients with the highest morphological variability were six to eight times more likely to die from a heart attack than those with low variability. They concluded that it consistently predicted as well or better than the indicators commonly used by physicians.

In the same week, researchers at the Sanger Institute in Cambridge revealed that they had reconstructed the biological history of two types of cancer in a piece of research that, according to the Guardian report, "promises to transform medical treatment of the disease". The research exposed every genetic mutation the patients have acquired over their lifetimes, including the ones that eventually caused healthy cells in their bodies to turn into tumours.

One of the diseases studied was lung cancer. The research revealed 23,000 mutations that were exclusive to the diseased cells. Almost all were caused by the 60 or so chemicals in cigarette smoke that stick to DNA and deform it. "We can say that one mutation is fixed in the genome for every 15 cigarettes smoked," said Peter Campbell, the scientist who led the lung cancer part of the study. "That is frightening because many people smoke a packet of 20 a day."

Although these stories are reports about medical research, they are really about computing in the sense that neither would have been possible without the application of serious computer power to masses of data. In that way they reflect a new but so far unacknowledged reality; that in many important fields leading-edge scientific research cannot be done without access to vast computational and data-handling facilities, with sophisticated software for analysing huge data-sets.

In many significant areas, advanced research is no longer done by individuals looking through microscopes or telescopes, but by computers enabling investigators to collate, visualise and analyse the torrents of data produced by arrays of instruments such as the Australian Square Kilometre radio Telescope or the Large Hadron Collider.

The man who did most to alert the world to the urgent need to take "computational science" seriously was Jim Gray, a much-loved visionary who worked for Microsoft Research. Towards the end of his life, Gray argued that we had moved into what he called "the Fourth Paradigm" of scientific research, which he dubbed "data-intensive scientific discovery". In 2007 he went sailing off the Californian coast and simply disappeared. Neither he nor his boat was ever found, despite an intensive conventional search butressed by a huge online effort by volunteers who scanned satellite images of the maritime area where the boat was estimated to be.

Last week, in a touching tribute to a lost colleague, Microsoft Research published a handsome book of essays in his memory. It's entitled The Fourth Paradigm: data-intensive scientific discovery and is available as a free download. In it are 30 thoughtful essays on four areas which were central to Jim Gray's vision environment, health, scientific infrastructure and scholarly communication. This book should be required reading for every policymaker responsible for science and technology to remind them that we now have to provide the resources to fund the IT infrastructure. If we don't give them these tools, then we cannot expect them to finish the job.

Hey, dude, what's with the roof? How not to look cool in the new BMW roadster

Is there any more hip- sounding class of car than a roadster? Not only does it conjure up the romance of yore, when a chap might shoot down to Brighton with his best gel by his side, but it also conveys a sort of contemporary ironic cool. For surely a roadster is what a dudemeister would drive.

And please, let's not get bogged down in definitions of who qualifies as a dudemeister. We all know one when we see one. In normal circumstances, I hasten to add, I wouldn't lay claim to dudemeister status, but driving a BMW Z4 is not a normal circumstance, even with the top up.

As a rule, what matters, or at least satisfies, most in sports cars is not performance but looks. Of course, that's a kind of sacrilege, especially for the school of thought that speaks in horsepower and torque. But the truth is it's highly unlikely that a driver will ever realise a sports car's potential on the road, whereas its appearance can be appreciated to the full at any time.

And the pleasing thing about the BMW Z4 is that it says "roadster" clearly, although not overly loudly, in a stationary position. The moment you see the long, sloping bonnet and tight little rear, the word "roadster" involuntarily forms on the lips, as though the mouth itself were revving up for action.

The BMW roadster has come a long way since the Z1 back in the 80s. That was short and angular, not at all what a roadster should be, and it featured strange retractable doors. Gradually it metamorphosed into the current model, which comes, for the first time, with a hard convertible top.

I had a few problems with the roof, namely that it failed to open on a couple of occasions. At these frustrating moments a warning signal informed me that something was wrong, although I had noticed this myself when the roof remained over my head, rather than folding, as it had done previously, into the boot.

As I repeatedly pressed the convertible button without success, I suddenly no longer felt like a dudemeister in a roadster. I felt like a nerd in a dud. I had a strong suspicion that it was me, not the car. But happily no one knew I was incapable of performing the defining function of driving a convertible. Indeed, I imagine few onlookers even realised it was a convertible. They probably just thought it was a coupe and I was the kind of person who likes tapping the dashboard for no good reason.

With or without the top, it's a very solid ride, almost heavy. Most of the weight goes into comfort, the pleasing and secure sense of a substantial piece of machinery you wouldn't, for example, want to find your hand in the way of a swinging door. The rest, presumably, is down to the roof. Except, of course, the roof stayed up.

Files outline South Korea and Washington's strategy in event of war on the peninsula

South Korea's military is investigating a cyber attack in which North Korean hackers may have stolen secret defence plans outlining Seoul and Washington's strategy in the event of war on the Korean peninsula.

The highly sensitive information, codenamed Oplan 5027, may have found its way into hostile hands last month after a South Korean officer used an unsecured USB memory stick to download it.

It reportedly contained a summary of military operations involving South Korean and US troops should North Korea conduct a pre-emptive strike or attempt to invade.

According to the Chosun Ilbo, a South Korean newspaper, the document outlines troop deployments, a list of North Korean targets, amphibious landing scenarios and how to establish a post-war occupation.

The Yonhap news agency said the plan allowed for the deployment of 700,000 US troops in the event of a full-scale war.

Embarrassed officials in Seoul attempted to play down its importance. The document was not a full text of the plans, said the defence ministry spokesman Won Tae-jae, adding that the 11-page file was intended simply to brief military officials and did not contain sensitive information.

The investigation has yet to establish how the hackers were able to get in or whether they were acting with North Korean support. One theory is that they used an internet protocol address registered in China, a preferred route for North Koreans attempting to hack into files on foreign networks.

The US has 28,500 troops based in South Korea. David Oten, a spokesman for the US military in Seoul, said: "As a matter of policy we do not comment on operational planning or intelligence matters, nor would we confirm details pertaining to any security investigation."

The mishap occurred in one of the world's most militarily sensitive regions. Tensions between the two Koreas have grown this year amid Pyongyang's refusal to abandon its nuclear weapons programme. Although the three-year Korean war ended in 1953 the countries have never signed a peace treaty and are divided by one of the world's most heavily fortified borders.

Faced with the military might of the world's only superpower, North Korea appears to believe it can at least gain an advantage in cyberspace. It is thought to have been responsible for high-profile cyber attacks in July that caused web outages at the White House and its South Korean equivalent, the Blue House. Reports in South Korea said investigators had traced the Chinese IP address used in those attacks to North Korea's post and telecommunications ministry.

The communist state is believed to operate an internet warfare unit, staffed by between 500 and 1,000 people, that attempts to hack into US and South Korean military networks in search of classified information or to throw government institutions into chaos.

The revelation that such sensitive information may have fallen into North Korean hands has provoked outrage in sections of the South Korean media. In a stinging editorial, the Chosun Ilbo noted that tens of thousands of heavily armed South Korean and US troops were involved in a tense standoff along the two Korea's land and maritime borders.

"If North Korean hackers can infiltrate the south's cyber borders at will, then all of those troops and weapons protecting the country along the border are useless," it said.

The electronic border control system was flawed from the outset. The IT profession needs to learn to stand up to its paymasters

One of the finalists in this year's e-Government national awards to be presented next month is a project called e-Borders. It is up for a gong in the category "innovation in strategy at a national level". This involves "delivering innovative strategies which have demonstrated above-average results in improved services, processes and effectiveness within the transformational government agenda".

There is one blot on the scheme's chance of winning. E-Borders, it seems, has been found to be illegal and unworkable and everyone involved must have seen this coming, despite immigration minister Phil Woolas's public defence of its legality today.

As usual, it started with quite a sensible idea, that of requiring intercontinental air travellers to the UK to be screened before they board their planes, not when they arrive physically in the UK. Troubles began to mount up when ministers announced that the same rules should apply to all international passengers, arriving by all carriers. This made enemies of everyone from City commuters to British homeowners in France to recreational sailors, few of whom are able or willing to give 24 hours notice of international travel.

The scheme also got into a monumental twist in order to accommodate the UK's land border with Ireland. To preserve the common travel area between the two countries, the government had to propose formal border checks on flights and ferries between Northern Ireland and the rest of the UK. And when that, understandably, outraged unionist opinion, the illiberal proposal was to propose border checks on all domestic ferry services.

Mercifully, following a challenge by rail and ferry operators, the European commission now seems to have killed off ambitions to impose the scheme on travel within the EU. The Home Office has had to concede that the scheme must not be used to impede the free movement of EU citizens.

In effect, data collection will now be voluntary, defeating the whole point of the exercise.

The question that must now be asked is how did anyone ever think e-Borders within Europe would be acceptable or legal? (Short, of course, from parting company with the EU and/or Ireland.) Did no one sound a warning? This is a public policy failing reminiscent of Margaret Thatcher's poll tax, and should be investigated accordingly.

In particular, we deserve to know if anyone in Trusted Borders, the commercial consortium contracted to implement the scheme, at a cost of 1.2bn, sounded a warning. The consortium's members include Raytheon, Accenture, Capgemini and Steria. These firms were specifically charged to "work as an open, honest and collaborative team". Did none of this open honesty involve pointing out that e-Borders within Europe risked being unworkable and illegal? I suspect the answer will be no: quibbling about the legality of a billion-pound contract is, in the jargon, a career-limiting move.

One of the main prongs of the government's efforts to reduce the toll of public sector IT disasters is to build up what it calls a government IT profession. IT suppliers and the industry's own professional body, BCS the Chartered Institute for IT (of which I am a member) say they are keen. But one of the marks of a professional is a duty to speak inconvenient truth, answering to a higher calling than your immediate paymaster. This doesn't make for the easy life it's no coincidence that the government's most intractable battles over policy tend to be with doctors and lawyers.

If the IT profession wants to be taken seriously, and perhaps do a better job along the way, it needs to get stroppy when necessary. It should also call to account its members who, when asked to do something unacceptable, keep their heads down and take the money.

$26 ( 16) software let militants view potential targets
American official says flaw was identified and fixed

One of America's most sophisticated weapons in the conflicts in Iraq, Afghanistan and Pakistan, the unmanned drone, has been successfully penetrated by insurgents using software available on the internet for $26 ( 16).

Insurgents in Iraq intercepted live video feeds from the drones being relayed back to a US controller and revealing potential targets. A US official said the flaw was identified and fixed in the past 12 months.

The problem only came to light after the US found many hours' worth of videotaped recordings on militant laptops late last year and earlier this year.

The insurgents used software programmes such as Skygrabber, developed by a Russian company and originally intended to download music and videos from the internet.

The drones have become one of the most important parts of the US armoury. Their use has increased sixfold over the past five years. They are able to hover over suspect sites and launch missiles against alleged militants in Iraq and alleged al-Qaida and Taliban militants in Afghanistan and the Pakistan border region.

The use of the drones in Pakistan is particularly controversial, in part because some Pakistanis see it as US infringement of the country's sovereignty, but also because civilians are often hit too.

The potential problem with the hacking was that insurgents, if they knew the locations being targeted, would be able to take evasive action.

A US source with knowledge of the programme today confirmed the report, first disclosed by the Wall Street Journal, but said that the quality of the pictures seen by the insurgents would have been of limited value. The pictures would have been fuzzy, making it nearly impossible to determine the location of a target in the deserts or mountains, the source said.

The US air force is responsible for drones in Iraq and Afghanistan, and the CIA for those in Pakistan. The CIA video feeds are reported to have been encrypted, while some of the air forces ones were not.

The Pentagon had been aware of the problem for many years, but had assumed the insurgents would not have the technical knowledge to intercept the feeds.

Air force Lieutenant General David Deptula, deputy chief of staff for intelligence, surveillance and reconnaissance, said: "Any time you have a system that broadcasts information using omnidirectional signals, those are subject to listening and exploitation. One of the ways we deal with that is encrypting signals."

When asked about the problem, a Pentagon spokesman, Lieutenant Colonel Mark Wright, indicated that it had been addressed. He said: "The department of defence constantly evaluates and seeks to improve the performance and security of our various ISR [intelligence, surveillance and reconnaissance] systems. As we identify shortfalls, we correct them as part of a continuous process of seeking to improve capabilities and security."

One defence official, however, said that upgrading the encryption in the drones would be a long process because at least 600 of the unmanned planes are in use, along with thousands of ground stations.

The first the US apparently knew about the interception was last year, when video feeds from a drone were found on the laptop of a Shia militant in Iraq who was allegedly backed by Iran. The US and Britain have both accused Tehran for years of interfering in Iraq. More laptops were found in the summer that suggested that the insurgents shared the video feeds.

While the US hints that Iran is the culprit behind the problem, it could simply be that an Iraqi searching for a football game or other broadcast came across the signal.

Marc Lockley is the Negotiator. Here he explains how to successfully purchase a netbook at a price that best suits you

Netbook fever has taken hold, with sales bucking the downwards trend in the wider PC market. It seems these machines are appealing enough to make students, travellers, business executives and serial surfers part with their hard-earned cash. But to make sure you don't spend too much money, follow our tips on how to purchase portability without getting carried away.

Choosing the right machine

Be sure it is a netbook you want rather than a laptop, as the former has more limited functions than its larger and often heavier counterpart. Intel offers a handy comparison of what you can do with each machine.

To make sure it is a netbook you want you should visit a store or borrow a friend's to try out it prior to making a purchase. Make sure you are comfortable with the keyboard and screen size. Consider when and where you plan to use it if you want to use it for long periods on the move then a long battery life will be a must. The Tech Republic blog has some useful tips on choosing between models, or you could put questions to netbook users in a forum like Netbook Choice.

Know where to look

While writing this article I researched the most talked about hardware at the time: the Samsung N130 netbook. Seemingly the best advertised priced was 229 (rrp 279). However, by delving into the negotiator's treasure chest OK, using an internet search engine you could have achieved the amazing price of 209 via a cashback offer. Further discounts of 15 were possible if you applied for a credit card and used it once, making the overall cost a value-busting 194.

Unfortunately the offer didn't hang around. But as sure as night follows day there will always be a store that breaks ranks and offers an additional incentive over and above their competitor. A good negotiator looks for the best value using all available resources, including the internet, newspapers, loyalty cards, cashback sites and voucher codes, alongside picking the right time to buy. Weigh up the possibility of the item being cheaper in the sales it may pay to wait.

If it is a gift for someone you could present them with an eye-catching IOU on Christmas day, promising them a netbook in the sales.

Negotiation know how

This time of year is difficult for negotiators. Shops are busy with Christmas chaos and then the sale season begins. You are unlikely to have your pick of assistants with which to drive a bargain. Polite but succinct persuasion will be the best approach as salespeople will want to sell you a product and move on to the next customer.

Before you even enter the shop set a limit up to which you would be happy to pay, and be prepared to walk away if the cost doesn't come in below that level. When you find a shop assistant to speak to say you were passing the store and thought you would pop in as you are planning to buy a netbook in the coming weeks. State your surprise at their price, quoting better deals you have sourced. Say you are happy to make them a sale if they would sell you the product for X.

You may wish to purchase additional items, for example an optical driver. Choose one of two approaches to make sure you get your desired deal:

a) Direct. Let the salesperson know you will buy from them if they offer you both products for X. If they are reluctant to give you them at that price, ask them what they could offer you. Sometimes salespeople will improve a deal if you purchase certain software, hardware or product insurance.

b) Stealth. Innocently ask whether the netbook comes with an optical driver, to which the answer is frequently no. Use a surprised look to tell them that this is an additional expense you were not expecting. Then ask what they can offer you.

If you can find a friend or colleague who also wants to purchase a netbook (or another high-priced item) in the same store, you may be able to save money by bulk buying. Club together and follow approach 'a'.

Don't give up if they say no; thank them for their time and aim for the door. If you manage to close it behind you without being called back it is likely you have got the best deal they are prepared to offer!

Internet on the go

If you are looking to purchase mobile broadband it is worth checking if you could get a free netbook when you sign up. The website Top 10 Broadband has a list of providers offering free netbooks and laptops. But make sure you read the small print most packages tie you in for two years.

If readers have had great success in purchasing a netbook, please tell us how you did it in the comments section below.

The Italian government's attempt to stop online 'hatred' about the attack on Berlusconi is likely to bring it into conflict with the EU

The debate about freedom of expression on the internet has heated up again in Italy, following the online response to the appalling attack on Silvio Berlusconi. Over the past few days, social networking sites have been filled with groups, many now closed, supporting either Berlusconi or his assailant, Massimo Tartaglia. Strong incitement to violence has been coming from both sides.

Italian politicians within Berlusconi's party say that the web reflects a "climate of hatred" that "dissident" journalists with their constant attacks on the government must take the blame for. Tighter regulations have been announced to "provide judges with further tools to prosecute web criminals", said Italian interior minister Roberto Maroni. He is due to present a new proposal aiming to punish those who, by writing their opinions on the internet, "engage in incitement to crime or the condoning of criminal acts". This is likely to be a set of new ways to control expression on the internet using judiciary power.

Does control mean censorship? Maroni says it doesn't. Yet there's a fine line separating one from the other. It risks being crossed if an opinion written on a social networking website can lead to prosecution. While it may be true that nothing on the net can be truly considered private, what's written on a Facebook profile, for instance, is still a personal opinion, even when it involves hatred, and as such it should not be censored or regarded as criminal. While it's fair to punish incitement to crime and the condoning of criminal acts and Italy already has laws to do that measures limiting freedom of online expression risk breaking an important principle and ruining the reputation of the net as a free space. It's worth remembering that the internet is not only a place where anger is expressed. It's also a space where civil society has discussed democracy. Controversial landmark rulings in various European countries' courts have already created doubt about whether the internet is to be left free.

It's inevitable that in a democracy where anyone can express their opinions, some of them will say things that aren't pleasant or fair, yet democracies normally let this happen and carry on, after punishing, if necessary, the individual involved. This also seems to be the philosophy behind EU regulations. Recently, the European parliament approved a new set of directives, called the telecoms package. "It is the first time that a judicial text refers to the use of the internet as the exercise of fundamental rights and freedoms," said parliament rapporteur Catherine Trautmann.

A note from the European parliament states that, according to the new regulations, internet access may only be cut off if "appropriate, proportionate and necessary within a democratic society" and only after "a prior, fair and impartial procedure" that gives users the opportunity to state their case and respects "the principle of presumption of innocence and the right to privacy". This law reinforces the principle that the internet is a space within which everyone, while still subject to criminal laws, has the right to freedom of expression.

But Italy seems to be going somewhere else. What the government seems to be willing to do is not far from recently approved French legislation known as the Hadopi law. Under the law, which deals especially with web piracy, an internet connection can be suspended for illegal activity. It's still not clear whether the Hadopi law will need to be changed to comply with the European telecoms package. It's likely to come into conflict with it by denying the principle of a fair proceeding before punishing a web offence. Viviane Reding, the EU's communications commissioner, confirmed that the EU telecoms package aims to prevent internet connections being cut off without due process. Referring to the same issue during a recent conference in Spain, she warned Jos Luis Rodr guez Zapatero's government not "to run into conflict with the European commission" over the way internet offences are dealt with.

When the European parliament is approving directives threatening existent regulations that limit internet freedom, it makes no sense for Italy to be heading in the opposite direction. As stated by the European parliament, the internet is a free, neutral space. EU member states should protect this principle.

Filmmaker Lynn Shelton on why having a geek as a friend is crucial to making the most of a new piece of kit

What's your favourite piece of technology, and how has it improved your life?
I have become completely obsessed with my iPhone. Before I acquired this about two months ago I had the oldest, saddest cellphone you've ever seen it was kind of a life-changer. I'm totally in love with it, it's like a member of my family.

When was the last time you used it, and what for?
Well it's hard to keep my hands off it. I try to when I'm travelling, because it's so expensive to use it. But I last used it last night updating my Facebook status.

What additional features would you add if you could?
I am a little jealous that a friend of mine has an actual vocal instruction GPS map system on her phone. I do love the maps feature though.

Do you think it will be obsolete in 10 years' time?
Of course 10 years? That's like eons in tech time. We'll all have little microchips in our heads and we'll be thinking each others thoughts instead of phoning.

What always frustrates you about technology in general?
Probably the scary, not quite real or trustworthy nature of storing things in bits and bytes. I shot a quick, short film last week and lost half the footage because I stored it to card instead of tape. I always wonder if I'm going to have enough backups of my backups.

Is there any particular piece of technology that you have owned and hated?
I remember back in the days of when people were still trying to figure out data storage, and there was a lot of removable data storage. I still have all of these things stored on obsolete formats zip drives and so on. There was a device called the Psyquest drive. And there were optical storage drives.

If you had one tip about getting the best out of new technology, what would it be?
What I always do if I'm trying to work out how to use a new piece of technology is to make friends with geeks have one great computer geek in your life. It saves a lot of time.

Do you consider yourself to be a luddite or a nerd?
Somewhere in between. It would be much more useful if I were a real nerd, but I'm not quite there thus, geeks are my friends.

What's the most expensive piece of technology you've ever owned?
Probably my laptop my Mac Powerbook.

Mac or PC, and why?
Mac, completely because I'm a filmmaker and love Final Cut Pro. But even beyond that I'm a sucker for their design. And I find the way they interact quite comforting I hate Windows.

Do you still buy physical media such as CDs and DVDs, or do you download? What was your last purchase?
I never really bought DVDs, I always rented those. But I always had a soft spot for independent music stores. So I do download music, but I do sometimes like to go and buy a CD. I think the last DVD I bought was The Guatamalan Handshake, by Todd Rohal.

Robot butlers a good idea or not?
An excellent idea. In my head, anyway I don't know about the real ones.

What piece of technology would you most like to own?
Probably a device that would sleep for me, like a mobile sleep bank. So I could stay up all night, and still get up at 7am and think clearly.

Lynn Shelton's latest film, Humpday, is now on release across the UK

The online encyclopedia claims that I passed away on 10 December. I'm happy to put the record straight

I can stop fretting about the imminence of my 70th birthday, for Wikipedia tells me that I am dead. It says that I have died very recently only a week ago, in fact and I would be interested to know what it thinks happened to me on 10 December, the supposed day of my death. As far as I recall, I did nothing at all that day except sit by the fire and write a column for G2, later rewarding myself with a large drink and an early bed. I have pinched myself again today, so I can state, as Mark Twain once did, that the report of my death is an exaggeration.

It was a reader who drew the Guardian's attention to my recently updated Wikipedia entry, which starts "Alexander Chancellor (January 4, 1940 December 10, 2009) was a British journalist".

Noting that the Guardian hadn't thought it worth commenting on my demise and that it had also published a column by me on the day after my death, the reader wondered whether someone had been "erroneously or maliciously editing the Wikipedia entry". Good question. I wonder, too.

Malice is the more appealing explanation, for it would be fun to try to guess who was responsible and why. But error is the more likely one. The examples of premature obituaries or death notices in the media are legion, but are nearly always the result of some muddle over a name or misunderstood report. Sometimes they can have a salutary effect, as when Alfred Nobel, inventor of dynamite, reading in his own obituary that he was a merchant of death, decided to make amends by setting up the Nobel prizes.

But I have merited no obituary so will just go on being a journalist for a while, though perhaps being a little more cautious about putting my faith in Wikipedia from now on. Anyone can edit it, and even as I have been writing this, someone has kindly brought me back to life.

Predicting the technology that wins out is hard work, but scientists and engineers are searching for the right answers

A few years ago, people who felt betrayed by the future suddenly gained a new rallying cry. After a lifetime of promises about robots and flying cars, we started to wonder: "Where's my jetpack?" Since then, the jokey slogan has found itself appearing everywhere from T-shirts to songs.

It's a jab in the eye of every futurist who made firm predictions about what we'll see in generations to come, and it's easy to laugh at the fools who dreamed of such frivolities. After all, merely guessing at the future is a fundamentally foolish business. That doesn't mean that we can't understand what is coming tomorrow, however, and prepare for the most likely futures by understanding how things happened in the past.

That is where the rich history of the Guardian's technology pages becomes more than just an archive of old newspapers. Over nearly 30 years, there have been titanic changes in the way we view and use technologies. We've seen computers move toward the centre of our lives, much of our food is engineered, families can be created in a lab and keeping in touch is cheaper and easier regardless of whether we do it physically or virtually. So what should we expect from the next decade?

Of all the trends that will dominate our lives in the coming years, computing is the one that has set the standard and followed distinct rules along the way.

The unending influence of Moore's law (a formulation that is both so beautiful and so ubiquitous that it has taken on an almost Shakespearean quality) dictates that our computers will become more powerful and less expensive as time goes on.

This will mean, for starters, machines capable of ever-increasing feats of power: lifelike graphics, smarter understanding, greater intelligence. "Singularity" advocates such as Ray Kurzweil believe this will end in sentient computers and while that is almost certainly excessive, we are already seeing extraordinary leaps in what machines can do. Academics are now crunching everything from terabytes of data pouring out of the Large Hadron Collider to data pushed to PlayStations to scour the universe for alien life.

With ever-increasing amounts of computing power to throw at complex problems, the ideas that have baffled scientists and engineers for decades may finally start to emerge from the darkness. That opens up the chance of high-quality visual recognition systems and accurate translations that work so fast they resemble acts of magic.

The trends set by Moore's law also mean that even the smallest devices will pack an increasingly powerful punch. Today, an iPhone contains the same amount of computing power as a Mac from 10 years ago; soon enough our handsets will enjoy the same processing power and capabilities as the high-end desktop computers we use now.

Look to the clouds

There is also an argument, however, that gadgets will become less powerful rather than more. Why? Because the immense computational power at our fingertips will also be available on demand thanks to cloud computing. With storage, memory and connectivity also advancing at a rapid clip, the built-in capabilities of your gadgets become less important than their ability to connect to a more powerful machine elsewhere.

And if the real brain of your phone or TV or games console can be squirrelled away somewhere else, many consumer electronics might simply become screens that plug into the network and present you with the appropriate information. These developments could easily ramp up as those screens continue to evolve to become cheaper, lighter, thinner, more flexible and more robust.

In addition to the gadgets we carry or use in the home, the plummeting cost of computers means it is almost certain that more of our world - the things we touch, we build, we grow will be able to incorporate these ideas. It's happening at various levels already: anyone carrying an Oyster card around on the Tube today, for example, has the same amount of memory in their pocket as one of Clive Sinclair's ZX81 computers from 1981.

This sort of ubiquitous computing (even at the lowest end) offers the possibility that we can build networks of things that talk to each other constantly. This subtle layer of activity will take place outside of our perception, but will have profound implications for our everyday lives with objects able to assess and regulate themselves and report back on what is happening to them.

So, the idea of an internet fridge in every home may still be an amusing fiction in 2020, but for western city dwellers there is a high likelihood that miniature computers will be baked into every brick, every piece of clothing or item of food.

Those objects could well include people, too. Biotechnology is another area of speedy development, and one that is just beginning to undergo the same revolution as the IT industry did in the 1970s. Understanding the processes of life, and treating organisms like we treat machines, suddenly opens new horizons all around us.

Now the human genome is mapped, for example, we are understanding more and more about it every day. Personal genomic companies are springing up and medicine is on the verge of ambitious advances in both treatment and cure. Certain diseases and syndromes could become a thing of the past in the next decade, while others if not eradicated will certainly be more properly understood.

Other areas, such as human enhancement and the production of artificial organs, are moving forward. Engineers are already able to "print" custom bones to order, though sometimes the change is much too fast for our ethical understanding to keep up. That is where the structures of the old world could step in order to slow progress down, as development becomes a game of politics not possibilities.

Politics is also likely to hurt the area where development is, perhaps, most necessary of all: energy. Our oil-based economies are ripe for technological revolution, but the answers today seem only half-baked and could quite easily stay that way.

While there is a groundswell of entrepreneurs and academics working tirelessly to come up with new answers, it is hard to tell whether the energy landscape will look very different in a decade. The Copenhagen summit is just one example that shows how difficult consensus can be.

Pull up to the bumper

In fact, as we engage in everyday behaviour watching 3D films with distant friends over our tiny disposable flexi-screens, or getting advance traffic reports streaming in from tiny transmitters hidden in cars and by the roadside the important theme could be how to use that technology to solve the problems presented by our dwindling natural resources.

Despite the continually falling prices, as physical goods get ever cheaper thanks to the efficiencies afforded by technology, we may find ourselves struggling to hold back. So often we hear about "doing more with less" soon that may be a battle cry, not a bumper sticker.

Whatever happens, the one thing the world still has in abundance is ingenuity, and while we're unlikely to see those jetpacks any time soon, there's still plenty to look forward to.

American military contractor shows off iPhone application intended to help soldiers track and kill insurgents on the battlefield

In little more than a year, applications for Apple's popular iPhone have become a sensation - with more than 100,000 downloadable programs that do everything from stargazing to virtual farting.

But now one of America's biggest military contractors is taking the concept to extremes, by building a series of apps for use on the battlefield.

At a conference in Arizona on Wednesday, US defence company Raytheon announced its plans to launch a new range of military-oriented programs that can turn the popular touchscreen mobile phone into a tool for use in war zones such as Iraq and Afghanistan.

The first application in its plans, called One Force Tracker, uses satellite positioning and mobile networks to give soldiers constantly updating field maps that track the position of friendly troops and enemy fighters in real time.

The program dubbed a "situational awareness application" by Raytheon executives would combine data from many sources to try and give an accurate picture of hotspots such as sniper hideouts and vantage points. Troops could also use their iPhones for secure communication, said the company.

"We are committed to providing innovative technology solutions for warfighters and all of our customers," said Jay Smart, chief technology officer of Raytheon's intelligence and information systems business.

The application can run on ordinary iPhone handsets a decision that came, Smart said, because building software for the gadget was cheaper and simpler than some of the expensive options specifically designed for military use.

"Raytheon's experience with mobile communications in the tactical environment and the government customers' need for low-power, simple plug-and-play applications led to the development of a real-time situational awareness application using Apple's touch technologies," he said.

It is not the first time the iPhone has been linked with military uses, however. Earlier this year Knight's Armament Company, an American weapons maker that supplies rifles to the Pentagon, launched a $12 ballistics application called BulletFlight which helps snipers and sharpshooters to hit their intended target.

Although it is most notorious for hi-tech weapons such as the Silent Guardian a pain-inducing microwave gun - Raytheon, which based in Massachusetts, has a history of using popular technology for military purposes. Among its innovations are systems used in the unmanned aerial vehicles that are based on video games consoles.

One Force Tracker is not only for the battlefield, though. Raytheon told the Intelligence Warfighting Summit that the software could also be used with some tweaks - by emergency workers such as doctors and firefighters responding to major incidents.

YouTube may begin offering subscription services that allow users to watch major new TV shows and films online, according to a senior Google executive.

While a number of broadcasters - including Channel 4 and Channel Five - have already forged deals with the Californian website to show full-length programmes online, the company indicated yesterday that it may consider paid options as well.

In an interview with Reuters, Google executive David Eun - who is in charge of partnerships with media companies - confirmed that paid subscription was an option as it tries to convince more TV channels and Hollywood studios to sign up.

"We're making some interesting bets on long-form content; not all content is accessible to us with the advertising model," he said.

The move would be an attempt to forge agreements with more rights owners, many of whom are reluctant to put their content online without adequate compensation.

Until now, the site has remained resolutely free for users and attempted to make its money through advertising. It has made limited deals to show movies on the site, as well as agreements such as the one with Channel 4, which was announced in October. Rather than charging users, these deals are based on a revenue split from the commercials attached to the programmes and films.

Despite these successes, however, the site - which Google bought for $1.65bn in 2005 - has not found it so easy to convince other broadcasters to follow suit. Hollywood studios have been notoriously testy about the possibility of putting more recent movies online with only the prospect of a share of advertising revenue in return.

"I think a free model is a very difficult way to capture the value of our content," said Chase Carey, the president of News Corporation - which owns broadcasters including Fox and Sky, as well as studios such as 20th Century Fox and Fox Searchlight - earlier this year.

Instead, Google hopes that offering money raised through subscriptions can tempt broadcasters to put their content on the site. The possibility of a pay-per-view model - such as the one used by Apple's iTunes store or Amazon's on-demand video service - could also be on the cards.

Google chief executive Eric Schmidt has said that making money from YouTube is a "top priority", with some analysts estimating that the site will haemorrhage as much as $470m ( 288m) this year alone.

Although the site is a household name that commands hundreds of millions of visitors each day, it has found it difficult to successfully cash in - with advertising attached to viral videos and user-generated content collecting paltry amounts of revenue.

Such a move could also help YouTube fend off growing rivals like Hulu - the US website that operates as a joint venture between NBC, News Corporation and Disney.

Since launching publicly in 2008 with a slate of hit shows including House and The Daily Show, Hulu has become the second most-watched video site in America. It is thought be considering expansion plans outside the US, which would include a move to Britain.

19.99; cert 3+; Touch! Generation/Nintendo

Aren't we due another Brain Training? As the game that eased many a commute and helped sell several thousand DS systems to the older generation it must be about time for more of Doctor Kawashima's synapse-firing exercises.

In the meantime, of course, the older gamer isn't short of options when it comes to flexing the grey cells. This latest effort from Nintendo may not have the quirky appeal or originality of a Professor Layton adventure (or, indeed, the variety), but as entertainment for public transport, on holiday or in the smallest room? It's a pretty solid collection.

It is, as the title suggests, a collection of crosswords. There are no cryptic ones which begs the question "why not?" but the game features more than 1,000 straightforward crosswords. At the Easy setting, clues such as "striped large cat" for five letters, or "move through water" for four won't trouble the majority of those playing. The "Medium" setting, however, mixes things up a little some plain sailing, some stumpers while the Hard setting does pretty much what it says on the tin. It is, in effect, like carrying several hundred Weekend crosswords in one handy games console.

The interface is so straightforward that the tutorials are unnecessary. Tap on a square, the DS zooms in so you can write your letter on the right-hand screen. It then moves up or down depending on whether you're solving an across or down clue.

If you're completely stumped, there are a few options to help beyond phoning a friend or hitting Google. There's a "cheat" setting that tells you when you've written an incorrect letter or, should you wish to keep the challenge a little more cerebral, you can purchase a handful of extra clues per puzzle.

Once you've exhausted / got bored with the crossword element, there are also Wordsearch and Anagram puzzles to be solved. The former is a surprisingly addictive pocket version of those books they sell at airports, the latter is a neatly challenging Countdown-style puzzle.

Graphically, there's nothing here that's beyond the functional but actually that's all you need. The important thing is playability and, for those who like this sort of thing (and I was surprised to discover that included me) this is a sensibly priced, well put together crowd-pleaser.

Rating: 3/5

Hundreds queue to buy latest version of role-playing game, which Sony hopes will boost Christmas sales of PlayStation 3

Hundreds of Japanese gamers queued from dawn today to be the first in the world to get their hands on the latest addition to the Final Fantasy role-playing series, whose popularity Sony is banking on to boost Christmas sales of its PlayStation 3 console.

The game's Japanese creator, Square Enix, said it hoped to sell at least 2m copies of Final Fantasy XIII domestically, which would make it the first PS3 title to sell more than 1m units in Japan. Analysts said worldwide sales of the latest instalment of the 22-year-old game could reach 5.6m.

This is the first time the title has appeared on the PS3 platform; the US and European versions, which go on sale on 9 March, will also be available for Microsoft's Xbox 360, the second most popular games console after the Nintendo Wii. (Final Fantasy XIII is not appearing on the Wii.)

The game has sold more than 92m units worldwide since its release in 1987.

With a price tag of about US$100 ( 60), the success of the game would provide a much-needed boost for game software sales in Japan, which declined 7.5% to 132.9bn yen (about 900m) in the six months to 30 September from a year earlier, according to Enterbrain, a Japanese magazine publisher and analyst.

Some industry watchers expect the title to increase PS3 sales by 500,000 units. That will be important for Sony, which has languished in third place for sales of the PS3 since it was released after significant delays and high production costs in November 2006, nearly a year after the Xbox 360 and Wii. That allowed its rivals to consolidate markets, and Microsoft has focused recently on ensuring that some hit games are sold only on the Xbox 360, such as Forza Motorsport 2 and 3, Gears of War and Halo 3.

But sales of the PS3 have now exceeded 4m, Enterbrain said this week, helped by the introduction of a cheaper model in September. The console now costs about half what it did when it went on sale three years ago although the supply chain analysis company iSuppli estimated earlier this month that Sony still loses an estimated $30 on each one.

The price cut helped make the PS3 the top-selling console in the US during September, the first time it had outstripped sales of both the Wii and Xbox 360.

In Final Fantasy's latest incarnation, which was five years in the making, players use a combination of magic and technology to help their characters battle enemies and progress through a futuristic setting.

"Of course, you can complete the game relatively quickly if you want, but if you take your time you'll be able to live inside the game for several months," said Square Enix's president, Yoichi Wada.

The Chumby does nothing you couldn't with an iPod touch yet, it has a peculiar, clever charm

Once upon the dotcom boom, 3Com announced a product called Audrey. Audrey was to be an internet device that would sit in your kitchen, and which you would use to do little online tasks. It would cost about $499.

It never arrived; and it's not even clear whether there are any Audreys still in existence. (Dreadful name, of course, didn't help.)Now, though, there's the Chumby. And the Chumby is everything the Audrey wanted to be, and much more. It's a small, mains-powered device, about the size of two of those juggling beanbags, and about as soft (or hard); it looks and feels throwable. It also has a little screen (3.5in, 320x240, which doesn't sound enough, but is plenty). And Wi-Fi. And an alarm clock function. And some USB sockets for connecting, occasionally, to a computer.

What's cleverest about the Chumby, though, is the "widgets" you can bring up, which connect to channels such as Facebook status updates, Twitter, weather, and various internet content sites, notably Shoutcast and Pandora (for you US types) and "Radio Free Chumby". No iPlayer yet. You can play MP3s from USB sticks. But that's really missing the point of the Chumby.

No, the point is realised once you set up a Chumby account and create some channels with widgets. The range is marvellous there are more than 1,000 to choose from. I discovered that you can delight young children for hours on end by letting them loose on a widget-enabled Chumby. Mine discovered one called "Choppy's Restaurant", which is a series of daft and exceedingly bloody cartoon sketches that make The Simpsons' Itchy & Scratchy cartoons look like, well, Tom and Jerry. Yet it's also harmless, pointless, funny stuff.

Adults will probably prefer to run a through a gentler loop of BBC website headlines, weather reports, Twitter and Facebook-related updates, and so on. You can input details using the slightly inconvenient onscreen keyboard, but it's a hassle you may not find worth the effort.

Far easier to leave the Chumby as a mostly passive device that does its stuff while you're doing yours. It's not a focus of attention; it's like a tiny TV or radio, chattering away to itself.

Of course, the screen isn't big enough to do proper internet searches or use it as a replacement for a computer. That's where the Chumby's design is clever: by going for the beanbag appearance, it has avoided any suggestion it's a computer. It's an appliance an internet appliance.

The price tag of 140 may make you wonder about it. Certainly, it's an indulgence; it's nothing you couldn't do with, say, a similarly priced iPod touch. But if you need to keep a couple of kids entertained for a few hours, there's nothing better.

Pros: simple, robust design; huge content choice; good interface

Cons: a bit pricey; onscreen keyboard not great

firebox.com

From ebooks and music players, to smartphones and computer gizmos, there's gadgets for all but it pays to research before you buy

If you're planning to give someone a gadget or gizmo for Christmas, be careful, or, if you can't manage that, at least make it cheap. Gadget geeks tend to know what they want, and they can be unreasonably fussy about what are, to rational people, minor differences in specification. But if you do want to surprise someone with a tech gift, there are plenty of options.

One is the Kindle ebook reader, which Amazon.com the US-based version of the shopping site says is "the most wished for, the most gifted, and the number one bestselling product across all product categories on Amazon". It hasn't taken off in the UK, because the original version wasn't available here, and the newer, $259 model has only been shipping to the UK for about a month. Why the delay? The system is based on the idea you can buy books from Amazon and they arrive on the Kindle, so it needs access to a mobile phone network. (You're not charged separately for this.)

Feel the burn

Having tried a new Kindle, I can attest to the fact that it works well as a portable book reader, and in the UK it also provides free access to Wikipedia. Also, while it has its limitations, it's both relatively rare and easily recognisable. This puts users one up on their fellow commuters.

How many people actually need an ebook reader is another matter. Most of us have been getting by with a pocket organiser or PDA, or one of the newer mobile phones. In gift-giving terms, however, today's obvious alternative is the Apple iPod touch. The small screen means it's arguably not quite as good as an ebook reader, at least for novel-length texts, but it's dramatically better as an MP3 music player, portable games console, movie and photo viewer, and web browser.

The third-generation iPod touch is the more affordable alternative to an iPhone, though it lacks the iPhone's camera, GPS and telephone connectivity, and neither device supports Flash. And having an iPod touch means you can listen to music and send emails without worrying about running the iPhone's battery flat.

For people who just want a music player there are more affordable alternatives, including Apple's iPod nano range. Curiously, the fifth-generation nano includes the camera that the iPod touch lacks. But for music buffs, Sony's range of MP3 players is now worth considering, as they generally sound better than iPods, and most or all of them ship with better earbuds.

Sony has taken a bit of a beating over the past decade, for supporting its own Atrac audio compression (used in the MiniDisc system) and its unlovely PC software, Sonic Stage. The newer Sony MP3 players don't use either. Plug them into any computer's USB port and you can use drag-and-drop to copy music files across under Windows, Mac OS X or Linux. Playing a folder full of classical music tracks is easier than trying to manage them using iTunes, though you'll probably want to renumber the tracks in multidisc sets.

While Sony has received lots of attention for its high-end X range of music players, it now has a small clip-style MP3 player that's hard to beat. The NWZ B143B USB Walkman stores 4GB of songs for 29.99 and works like a thumbdrive: you plug it into a USB port. Although you can get similar "off-brand" MP3 players for less, the Sony has a quick recharge feature: three minutes of USB recharging provides about three hours of play time.

Mobile phones have also made a huge impact on the photographic business, and smartphones often include cameras that capture images with 5 megapixels or more. But they also tend to have very small image sensors, which means image quality doesn't really compare with compact cameras, let alone with consumer-level digital DLR cameras.

Watching the detectives

At the moment, one of the most attractive compacts is the Samsung ES55, a 10.2MP camera for under 75. It's a point-and-shoot model with a 2x optical zoom, but it also has face detection (to get people in focus), blink and smile detection, and image stabilisation (to reduce blur). It even has a Beauty Shot feature to lighten and smooth your subject's skin. Although it's also available in black, silver and grey, I suspect a lot of its users will want the pink version.

Other compact cameras worth a look include the slimline Canon Digital Ixus range and the Panasonic Lumix models, particularly the TZ7 ( 229). This has a 25mm wide-angle Leica lens with a 12x optical zoom and lots of electronic features for simple picture taking; it also takes high-def movies (1280 x 720 pixels) in AVCHD Lite

For people who just want to take simple movies, the Flip Ultra HD is the popular choice. Flip, now owned by Cisco, popularised very small Flash-based point-and-shoot camcorders, and remains the market leader. The Ultra HD comes in two versions you can have 4GB ( 90) or 8GB ( 120) of storage and is small enough to carry everywhere. It's great for capturing things for sharing on YouTube, or posting on blogs, and even a child can use one.

But the Flip Ultra's simplicity comes with a lack of versatility. The lens is fixed-focus, there's no optical zoom, and the camera is hard to hold still there's no built-in image stabilisation. Someone who wants to make movies would be much better off buying a more conventional digital camcorder from Canon, Sony, Panasonic or similar company. The Panasonic SDR-S26 ( 170), for example, has a 70x zoom lens, image stabilisation, face detection and a night-view mode. It uses SD cards for storage, so you don't need to be near a PC.

There are also plenty of high-definition (HD) models around now, at more affordable prices. A good example is the Panasonic HDC-SD10 ( 313), but buying and using an HD camcorder needs a bit more research than picking up a Flip Ultra HD.

Widening the net

When it comes to computers, netbooks are an attractive option as they are relatively cheap and work as companion PCs for people who already have larger notebooks and desktops. It's also a market where model ranges change quickly, so older netbooks are often available at substantial discounts.

This Christmas, Samsung looks likely to continue the success it enjoyed with its first netbook, the NC10, which offered a good specification and decent build quality at a reasonable price. That has now been upgraded to the N130, which is available in black, white and pink, and still runs Windows XP. The keyboard, 10.1in screen and lightweight design (1.3kg) make it very good value at a discount price of around 229. There's also a slightly more luxurious N140 version with better battery life for an extra 50.

Asus, which kicked off the netbook market with its Eee PC range, now has the thin ultraportable 1005HA Seashell ( 250), which offers an "isolated keyboard" spaced out flat keys and "up to 10 hours" battery life, against the Samsung's claimed six hours. In other respects, the systems are similar and neither would disappoint.

The computer industry also provides thousands of peripherals that could be potential gifts, including monitors, keyboards, mice, webcams, and thumbdrives. But the one thing almost everyone wants is more external hard drive space, and terabyte (1TB) drives are now available for less than 70. An external hard drive isn't the most romantic gift, but it's one that will actually get used, rather than ending up in a drawer or at Oxfam!

An internet startup says it is considering legal action against Microsoft, after the world's biggest software company admitted stealing its code.

Earlier this week internet messaging company Plurk accused Microsoft's MSN China operation of lifting code directly from its own program for use in a rival product.

After a brief investigation, Microsoft responded by confirming that it had stolen elements of Plurk's system and apologising - blaming a Chinese developer hired by MSN China for the transgression.

"The vendor has now acknowledged that a portion of the code they provided was indeed copied," it said. "This was in clear violation of the vendor's contract with the MSN China joint venture, and equally inconsistent with Microsoft's policies respecting intellectual property."

An apology may not be enough for the two-year old startup, however, which said that it was looking at "the full extent of our legal options" as a remedy.

"We are currently looking at all possibilities on how to move forward in response to Microsoft's recent apology statement," said co-founder Alvin Woon in a blog post today.

"We are still thinking of pursuing the full extent of our legal options available due the seriousness of the situation. Basically, Microsoft accepts responsibility, but they do not offer accountability."

The MSN product, Juku, has been suspended pending further investigation, but Woon took particular issue with the extent that it relied on code stolen from his own team.

"This event wasn't just a simple matter of merely lifting code," he wrote. "Due to the nature of the uniqueness of our product and user interface, it took a good amount of deliberate studying and digging through our code with the full intention of replicating our product user experience, functionality and end results. This product was later launched and heavily promoted by Microsoft with its big marketing budget."

Plurk, a messaging service along the same lines as Twitter, is registered in Canada but operates a small staff of around seven people worldwide. It has significant numbers of users across Asia, and claims particularly strong following in countries like Taiwan.

Faced with a corporate leviathan attempting to muscle in on its territory, Woon said Plurk wanted to stand up for the rights of small companies.

"We write our own code and give back to the community when it is appropriate," he added. "We play the fair game hoping, like many young entrepreneurs out there, to be able to someday help solve other people's problems and grow our little company."

Online editions seen as threat to backlist cash cow

The scramble for survival in the New York publishing world provoked by the rise of the ebook has become so ruthless it makes the Wild West look like a Swiss finishing school.

Authors and publishers are squabbling over rights, internet retailers are slugging it out with bookshops, and tech companies are climbing over each other to produce an ebook reader that can challenge Amazon's hit, the Kindle.

The latest blast of gunfire has come from one of America's leading authors in the highly lucrative market of business self-help books.

Stephen Covey has announced he is selling exclusive digital rights to two of his bestsellers The 7 Habits of Highly Effective People, and Principle-Centered Leadership to Amazon, bypassing the traditional publisher, Simon & Schuster, that has up to now handled all his output.

The move has put a chill over New York publishing houses already struggling to keep up with the ebook revolution. One of their big fears is that of becoming separated from their backlists, the titles that act as the cash cows of the industry, bringing in a steady and increasingly crucial income in the insecure digital world.

As jitters spread, some big publishers have moved to defend what they claim is theirs the digital rights to the backlist.

Random House startled many in the book world this week by sending a letter to agents informing them that, in its view, the publishing house holds the exclusive rights to digital editions of the "vast majority" of its backlist titles. That made authors and their agents see red. They pointed to a ruling by the New York courts as far back as 2002 in which Random House itself failed in an attempt to block on ebook firm from publishing works by the late William Styron, author of Sophie's Choice, and Kurt Vonnegut. The ruling, upheld on appeal, found that copyright for books that were written before digital publishing existed, remained with the author.

Arthur Klebanoff, head of RosettaBooks, the ebook company that beat off Random House in 2002, secured Covey's exclusive deal this week with Amazon. He said: "We are very clear about this, the author controls the rights unless it is specified otherwise, and that was settled by the courts years ago."

Simon & Schuster, which took a knock over the Covey deal, was taking a softer stance than Random House but not accepting defeat. Adam Rotherberg, a spokesman, would not comment on Covey specifically, but said in general terms it was the company's "intention to publish the electronic editions to our backlist titles".

Simon & Schuster, like other big houses, is trying to protect income from print books by delaying the publication of new ebooks by four or six months after release of the hardback editions.

The spat in the US stands in contrast to Britain, where publishers broadly accept that they do not have the rights to the ebook editions of older titles, and authors accept that they should avoid offering ebooks to other publishers.

"There is a kind of gentleman's agreement," said Anthony Goff, an agent with David Higham, who heads the trade association for literary agents in the UK.

One reason for panic in the US is that there the ebook market has already grown to a significant size. Almost $16m (nearly 9m) of ebooks were sold in September, a year-on-year growth of 171%.

Amazon enjoys the lion's share of that market through its website and popular Kindle, and the deal with Covey is an indication that it intends to tighten its grip. This year about three million e-readers have been sold in the US, a number that could double in 2010.

Although the Kindle is the industry leader it is facing strong competition from the Sony Reader and the Nook, a new offering from book chain Barnes & Noble.

A further shake-up lies ahead when Apple wades in, as expected in the spring, with the Apple Tablet.

As these behemoths fight it out in an increasingly ungainly display of muscle, the big question is what happens to authors and their readers, which is after all what the fuss is about.

Bestselling names such as Covey are likely to prosper, as will their fans who will benefit from knockdown prices. Amazon is selling some titles for as little as $7.99, massively below their paper price.

Less well-known authors have yet to reap any rewards.

Paul Aiken, head of the Authors Guild, pointed out that most ebook deals award authors 25% of royalties, which, given the lower costs of publishing digitally, is only about a half of the accepted rate in print books.

"Up to now that hasn't been much of an issue, because the ebook market was so tiny," Aiken said. "Now that's changing, and authors with clout are starting to demand more."

This article was amended on Thursday 17 December 2009. We said Simon & Schuster "in tandem with other big houses" is trying to protect income from print books by delaying the publication of new ebooks after release of the hardback editions. To clarify, we meant to say the company is pursuing a similar strategy to others, not that it is co-ordinating its strategy with them. This has been corrected.

US regulators today launched a legal action against Intel, amid fresh accusations that the computer chip maker deliberately stifled competition.

The announcement by the Federal Trade Commission, which oversees the enforcement of competition law in the US, marks the latest in a series of worldwide antitrust cases against the Californian technology company - and is the most significant action taken by the regulator since it took Microsoft to court in the 1990s.

The FTC said that its decision to sue Intel comes after a long string of allegations that the company forced and coerced computer manufacturers to use its technologies instead of those made by rival companies.

"Intel has engaged in a deliberate campaign to hamstring competitive threats to its monopoly," said Richard Feinstein, who heads up the FTC's bureau of competition.

"It's been running roughshod over the principles of fair play and the laws protecting competition on the merits. The commission's action today seeks to remedy the damage that Intel has done to competition, innovation and, ultimately, the American consumer."

Among the allegations are claims that the company offered discounts to customers like HP, Dell and IBM on the condition that they drop products from its main rival, AMD. The company is also accused of deliberately deceiving its customers and "smothering" potential competitors.

Intel has responded by calling the case "misguided" and suggesting that some of the allegations had been added after earlier negotiations to settle the case out of court had reached an impasse.

"The FTC's case is misguided," it said in a statement. "It is based largely on claims that the FTC added at the last minute and has not investigated. In addition, it is explicitly not based on existing law but is instead intended to make new rules for regulating business conduct. These new rules would harm consumers by reducing innovation and raising prices."

In a briefing with reporters, Intel's general counsel Doug Melamed argued that the FTC was overstepping its legal mandate.

"Some of these issues were brand new to us," he said. "It seems to me that the FTC is seeking to restrict all kinds of pro-competitive price discounting."

The lawsuit, he said, was designed to unfairly restrict the activities of large companies offering legal discounts to customers "and from protecting their intellectual property rights by controlling their licensing and preventing others from taking advantage."

The case comes after similar actions against Intel in other jurisdictions, including a case brought by the New York attorney general Andrew Cuomo and a record 1.06bn fine from European regulators who accused the company of "harming millions of European consumers".

It also follows the news last month that Intel had agreed a $1.25bn settlement with AMD, its major competitor, to bring to an end a series of complaints about its business conduct.

Much of the FTC's case against Intel is similar to the one heard in Brussels, which produced evidence that the company had spent millions paying companies to avoid AMD's products - and against which Intel is appealing. However, American officials also added new allegations to the mix by saying that Intel had also presented certain performance information in a way that misled both customers and competitors.

"Intel secretly redesigned key software, known as the compiler, in a way that deliberately stunted the performance of competitors' CPU chips," the commission said. "Intel told its customers and the public that software performed better on Intel CPUs than on competitors' CPUs, but the company deceived them by failing to disclose that these differences were largely or entirely due to Intel's compiler design."

The case significantly expands on previous claims by including not only CPUs - the central processing units that form the brain of the modern computer - but also GPUs, the chips used to power computer graphics. While AMD is Intel's main rival in the CPU market, other companies compete against Intel in graphics, including Nvidia and Via.

"We applaud today's action by the US Federal Trade Commission," said Nvidia in a statement. "We are particularly pleased to see scrutiny being placed on Intel's behavior towards GPUs, which have become an increasingly important part of the PC industry."

As the noughties come to a close, we take a look at the biggest technology stories of the decade - and how the Guardian reported them at the time

Five years ago the order of things as we know them started to fall into place; most of the services we're familiar with today were around, most of the companies were in place, most of the technologies we think of as cutting edge were already beginning to make a mark. Even Facebook was there, for goodness' sake (although I think we didn't make mention of it until 2005).

Turns out I made a mistake in yesterday's post. It was 2004 when I joined Online, not 2003... feels so long ago I had got the timeline mixed up. But still, the shift (which involved moving into a cold corner of the Guardian's main newsroom) felt like a big deal. If only I could remember when it happened!

Anyway, let's get on with the next year in our roundup.

2004

• The biggest story of the year was probably the stock market launch of Google: the event that turned the company from a hot startup to a leviathan. After lots of planning, plenty of speculation, and a bit of a cock-up thanks to an interview in Playboy (yes, Playboy!) the IPO in August valued the company at some $24bn. Wall Street had the knives out at the time (they'd wanted more) but John Naughton dissected the reaction, which he called "vindictive sentiments". Two months later, shares had risen sharply, doubling the size of the company and shooting it past its great rival of the time, Yahoo.

• After its American debut in 2003, iTunes finally made it to Europe - launching with a "lavish press conference in London that featured a performance from American diva Alicia Keys". It emerged just before the launch that a number of labels had pulled out (citing the "commercial suicide" that iTunes entailed) but they didn't take too long to be swayed. By September, however, the service was already coming under scrutiny with the OFT launching an investigation into why UK users paid a 17% premium over their European counterparts.

• Regulatory pressure on Microsoft, too, came to bear with the European Union levying the first of what would be many fines against Bill Gates and friends - this time for bundling digital media and server products in an abusively monopolistic fashion. The 497m fine was the biggest in European history at the time, but it was described as a "traffic ticket" by critics who pointed to the billions the company had in the bank.

• Mobile was still getting bigger and bigger, and networks - having spent a gigantic 22bn on 3G licenses back at the turn of the century - were finally
getting ready to launch their own high speed mobile data networks - but they weren't necessarily too keen on the idea. Nor, it seems, were consumers... Which? put the cat among the pigeons when it told potential buyers that they'd be better off waiting.

• And in October, a significant step forward was made toward space tourism when SpaceShipOne scooped the X-Prize. At more than 100km above the earth's surface, the craft broke records - and forged a deal with Richard Branson to build a fleet of craft in the process.

That's it for this week - we're going to come back and look at 2005-2009 from Monday through to Christmas. Any thoughts, omissions or recollections of your own? Add them to the comments below.

Gameloft will scale back on developing games for Google's Android, despite appearing to reverse its decision after drawing flak from industry experts

Mobile-game developer Gameloft will still cut investment in Google's Android platform despite an apparent U-turn on its controversial decision last month to scale back on developing games for the operating system.

Gameloft's chief financial officer, Alexandre de Rochefort, told an investor conference in November that Android's limited ability to get Gameloft products to customers had been a deciding factor in cutting investment. "It is not as neatly done as on the iPhone. [Moreover,] on Android nobody is making significant revenue."

The announcement drew immediate criticism, including from Telecoms analyst Peter Boyland of IHS Global Insight, who said: "While the iPhone is undoubtedly the iconic handset of the decade, its status as a 'must-have' is waning. While Android is still something of an unknown quantity, Google is fully committed to entering the mobile internet market, and is unlikely to allow the platform to fail without a fight."

Perhaps heeding such warnings, Paris-based Gameloft made a volte-face within days, announcing that it would be bringing out a number of high-definition titles for the second generation of Android handsets and reaffirming its commitment to the current generation.

Yet its investment in Android is still being reduced, and it's becoming clear that the company still considers the iPhone to be very much where it's at at least for the moment.

De Rochefort told the Guardian that the iPhone had had a dramatic effect on the mobile-gaming industry: "With regular mobile phones, those running Java and BREW, only 3% or 4% of users download games on a regular basis. On the iPhone, that usage rate rises to around 15%, and up to 18% in the UK according to recent research. It's clear that people are keen to play games on their phones it's just that previously there has been no platform allowing them to do this in a way they were sufficiently excited about.

"The way I see the market growing is that more and more people are going to be equipped with iPhone-like devices, and we can thus hope to grow usage rates from 3% for most of our business, to maybe in the region of 10% a tripling in market size."

Gameloft, which was launched in 2000 by Ubisoft co-founder Michel Guillemot, has since gone on to become one of the world's leading mobile-game companies, with an expected $180m in sales in the current year and more than 4,000 employees. De Rochefort credits much of its success to its development capacity: "Our teams all work in house. We do not subcontract, which allows us to keep close control on the development cycle of the games and, at the end of the day, have a better quality. We also have put a lot of emphasis on being able to sell worldwide; we are the only non-Japanese company to sell mobile games in Japan."

Gameloft's biggest selling mobile games have been, as de Rochefort describes them, "simple casual games," such as arcade puzzler Block Breaker Deluxe. As more powerful handsets reach ever-greater numbers of consumers, Gameloft has responded with increasingly sophisticated titles. "Basically there is an ongoing shift from 1MB apps your regular Java app to 300MB apps that exist today on the iPhone."

The company's recent and upcoming releases for the iPhone include a port of the 1999 PlayStation classic Driver; a Halo-esque first-person shooter called NOVA; driving game GT Racing; and Avatar, an action platformer based on the new James Cameron film. Many of Gameloft's recent games have been very well received, both critically and commercially, and these latest titles seem to be no exception. NOVA, in particular, looks extremely promising.

There has been some criticism, however, that a large proportion of Gameloft titles are either revamped versions of old games (as with Driver and the recently released port of Earthworm Jim), or else highly derivative games taking their cue from other titles, with little in the way of innovation.

De Rochefort plays down such claims: "I admit we haven't reinvented games genres, but then very few companies have. At the end of the day, all video game companies are just refining genres and game types and trying to improve the experience for the consumer. New game concepts are very, very difficult to come by. There's only one Tetris, and the next Tetris might not appear for 20 years.

"I know some gamers would like to see new concepts all the time, but that's impossible. We're just trying to make the best games in their genre; the fact that the genre already exists means elements of those games will remind you of things you've seen in the past. You're not going to reinvent the wheel every time you make a game but, as a start, we can refine and improve the experience. This is something you've seen in the industry since the beginning, and it's driving the industry in the right direction."

Having worked with a digital distribution model since its inception, Gameloft has recently begun branching out into releasing content for other platforms. De Rochefort says: "Over the last year and a half, we've seen a convergence between mobile phones and consoles. On the one hand, mobiles are getting closer and closer to console capacity the prime example being, of course, the iPhone, which, in my opinion, is far better than the DS from a gaming perspective, and getting very close to the PSP now.

"At the same time, consoles are getting to be more like mobile phones, in that the three main manufacturers Nintendo, Microsoft and Sony have all added download functionality. The business model on these consoles is increasingly looking like what we've been doing for nine years on mobiles; mainstream games sold at 5 to 10, downloaded over the internet. This is exactly what we've been doing on mobile phones, and so it seems natural for us to go there.

"Consoles represented 5% of our sales in the first nine months of this year, and I expect that figure to grow, but it's going to take time. Our core business remains the creation mobile games."

Looking to the near future, de Rochefort is unshakeably confident, in spite of the difficult economic climate: "We're selling games for around the 4 mark, and I believe these low prices will continue to immunise us from the worst of the recession. While it's difficult to accurately estimate the effects of the crisis, in the first nine months of the year our sales grew by 18%. Without the current economic situation, perhaps we could have grown it by 20 to 25%."

Curriculum vitae

Age 36

Education Received his degree from ESSEC Business School in 1996.

Career Senior Vice President and CFO for Gameloft; joined Gameloft in July 2000 shortly after the creation of the company. Prior to joining Gameloft, worked at Schroder Securities in London as a Sell Side Research Analyst specialising in Technology Stocks.

Facebook's new privacy settings have prompted the Electronic Privacy Information Center and other groups to complain to the US government

The Electronic Privacy Information Center (EPIC), the Center for Digital Democracy and eight other organisations have filed a complaint to America's Federal Trade Commission about the changes Facebook has made to its privacy settings.

Facebook's changes encourage people to make information more widely available and easier to search. Previously, the system encouraged users to make information available only to their friends and people in the same networks. The simplified transition page does allow people to choose to keep their old settings, but the complaint to the FTC argues that the system is less private than it was before.

Facebook chief executive Mark Zuckerberg appeared to be a victim of the site's new privacy settings. The changes enabled everyone to look through his photo albums and Valleywag, now part of the Gawker blog, published "some of the more interesting shots". In the UK, the Daily Mail published a picture of Zuckerberg cuddling his teddy bear.

Some Facebook users will be in for a shock when they find that 350 million members can now see photos that they uploaded when they were perhaps only available to a few close friends. Photos, fan pages and lists of friends that are searchable could also show up on Google and other search engines, which in effect makes them available to billions of people.

It could be a great attraction for potential stalkers.

In a statement, Facebook spokesman Barry Schnitt said that Facebook "discussed the privacy program with many regulators, including the FTC, prior to launch and expect to continue to work with them in the future."

However, on the All Facebook blog, Nick O'Neill has pointed out that the privacy settings could represent an even greater threat to users who live in countries such as Iran. He writes:

Iran is known for pursuing and occasionally arresting those who speak out against the current regime in an attempt to curb further uprisings. There is no doubt that the state is monitoring Facebook usage including Facebook Pages and groups in an attempt to determine who are the greatest threats to the existing regime.

For Facebook, of course, having more information publicly available makes it easier to target users with paid advertisements.

Millions of White House emails that went missing during the Bush administration have been recovered following an extended court battle.

Around 22m messages spanning more than 90 days were declared missing in 2007, shortly after a scandal arose over the decision to fire nine federal prosecutors who had not toed the White House line.

The Obama administration said that its computer technicians had successfully recovered the lost data, in what campaigners called a victory in the attempt to clear up the "electronic data mess" left behind by Bush officials.

The White House is legally obliged to maintain copies of all the communication it sends, including email, under the Presidential Records Act - brought in after the Watergate scandal in the 1970s as a way of preserving evidence of activities conducted by presidential staffers.

But when public interest campaign groups launched attempts to recover the messages relating to the controversial sackings, it was revealed that millions of emails sent during the period in question had been lost.

That news sparked allegations of deliberate obfuscation by Bush's opponents, and led to lawsuits by the Citizens for Responsibility and Ethics in Washington, and the National Security Archive - an independent group that collects public information from the US government.

The groups said they were pleased with the result, which would help transparency efforts.

"We now know that many poor choices were made during the Bush administration," said Meredith Fuchs, general counsel to the National Security Archive. "There was little concern about the availability of email records, despite the fact that they were contending with regular subpoenas for records."

However, the documents may not become available to the public until 2014 - and even then, only if they are deemed valuable under the Freedom of Information Act.

"We may never discover the full story of what happened here," said Melanie Sloan, CREW's executive director. "It seems like they just didn't want the e-mails preserved."

Patrick Leahy, a Democrat senator from Vermont and the chairman of the Senate judiciary commission, said that the White House under Bush had made several attempts to dodge requests to recover the emails.

It was, he said, "Another example of the Bush administration's reflexive resistance to congressional oversight and the public's right to know".

After a delay of more than two years, the Boeing 787 Dreamliner, with its lightweight design, has made a successful test flight

Watched by hundreds of cheering workers from the aircraft factory, Boeing's 787 Dreamliner took to the skies for the first time at an airfield near Seattle, in a long-delayed test flight for a plane viewed as a breakthrough due to its lightweight design, hi-tech composition and fuel efficiency.

At 10.30am local time, the plane, painted in blue and white Boeing livery, lifted off smoothly in damp conditions. But the flight, which was due to last four hours, was brought to an end an hour early when persistent rain swept through the area. Flown by Boeing's chief test pilot, Mike Carriker, the 787 was flanked by two T-33 military reconnaissance aircraft and was filled with equipment to measure its performance, efficiency and safety.

In a rare show of solidarity, Boeing's European rival, Airbus, paid tribute to the US company and promised robust competition: "Airbus congratulates the people of Boeing on this important achievement in their history."

About half of the 787 is built from carbon and titanium composites, rather than the aluminium used for the majority of commercial airliners. Its lightweight design has allowed Boeing to promise tens of millions of pounds of savings on fuel and maintenance to its customers. Boeing has received orders for 840 aircraft, including advance sales to British Airways, Virgin Atlantic and Monarch Airlines, and the plane is viewed as crucial to Boeing's success in its commercial rivalry with Europe's Airbus.

"It's only the second time in the history of aviation that the materials with which aircraft are built have fundamentally changed," said Wolfgang Demisch, a New York-based consultant on aerospace finance. "They went from wood and fabric to metal. And now from metal to composites."

Conceived in 2003, the 787's journey to its first flight has been a turbulent one. The test was two-and-a-half years late after a series of technical hold-ups, strikes and problems with suppliers. At one stage in the highly delicate process of assembly, progress was hampered by a tiny disparity of 0.3 inches at the connection between the plane's cockpit and fuselage sections. More recently, engineers have struggled with a shortage of bolts and with a stress tests on a joint between the wing and the body.

A mid-size plane, the 787 will carry about 250 people on long-haul routes of up to 8,200 nautical miles covering London to Jakarta in one hop. It will use 20% less fuel than more conventional aircraft.

The Dreamliner faces a further 10 months of tests to obtain full certification of its air worthiness before deliveries to airlines can begin. If all goes to plan, the first deliveries could take place at the end of 2010.

Flagship vehicles rolled out to customers as Lord Mandelson boosts government's electric car strategy. From BusinessGreen, part of the Guardian Environment Network

Two of the world's largest car firms kicked off trials of their flagship electric vehicles this weekend as part of a nationwide pilot scheme backed by the Technology Strategy Board (TSB).

Mitsubishi's electric i-MiEVs and BMW's electric Mini were both distributed to participants in the trial, which is intended to inform both the development of the yet-to-be-released vehicles and the government's wider electric car strategy.

Mini's electric car trial began in Oxford where 40 customers picked up their cars as part of a pilot scheme that has seen a special charging points fitted at the homes of the successful applicants and data collection devices fitted to each of the Mini Es.

The company said that the six-month project was intended to evaluate the psychological, social and technical aspects of living with an electric car. The information will be collected by Oxford Brookes University and then made publicly available.

The Mini E is based on the Mini hatchback, but the back seat is converted to store batteries. The 35kWh lithium-ion battery powers a 201bhp electric motor, which provides similar acceleration to a standard mini.

BMW which owns Mini says the overall CO2 emissions from the car equates to roughly 68g/km, which is around half the CO2 emitted by a 1.25l Ford Fiesta. It added that the emissions related to the vehicle would fall over time as more renewable energy plays a greater role in the UK's energy mix.

The trial has been part-subsidised by the TSB with participants in the trial paying 330 a month, excluding charging costs, for use of the vehicles. BMW estimates a full charge will cost 1.50 at night and 4.00 during the day. It added that each full charge will give the vehicle a range of about 150 miles.

Meanwhile, Mitsubishi's pilot scheme has seen 25 i-MiEVs, the electric version of its compact four-seat, four-door, rear-engined "i" city car, distributed to customers in the midlands.

The cars were distributed as part of the 15m Coventry and Birmingham Low Emission Vehicle Demonstrators (Cabled) project, which will ultimately see 110 vehicles trialled in Birmingham and Coventry.

Under the scheme, Indian auto giant Tata will contribute 25 electric Indicas, Microlab will provide 10 hydrogen fuel cell vehicles, Land Rover is to supply five Range_e plug-in hybrids and LTI will provide five electric taxis.

E.ON, Birmingham City Council and Coventry City Council will also install electrical charging points for the vehicles and arrange access to the University of Birmingham's hydrogen refuelling station.

The launch of the trials came as business secretary Lord Mandelson announced plans for a new 19m competition to help accelerate the development of electric vehicles. More details of the competition are expected to be announced in February.

This article was shared by our content partner BusinessGreen, part of the Guardian Environment Network

Far from being a cure for the industry's woes, substituting streams for downloads wastes bandwidth, reduces privacy and slows innovation

Someone convinced the record and movie and TV industries that there is way of letting someone listen to audio or watch video over the internet without making a copy. They call this "streaming" audio, and compare it to radio, and contrast it with "downloading", which they compare to buying a CD.

The idea that you can show someone a movie over the internet without making a copy has got lots of people in policy circles excited, since it seems to "solve the copyright problem". If services such as Hulu, Last.fm and YouTube can "play you a file" instead of "sending you a file", then we're safely back in the pre-Napster era. You can sell subscriptions to on-demand streaming, and be sure that your subscribers will never stop paying, since they don't own their favourite entertainment and will have to stump up in order to play it again.

There's only one problem: Streaming doesn't exist.

Oh, OK. Streaming exists. It is a subset of downloading, which comes in many flavours. Downloading is what happens when one computer (a server, say) sends another computer (your PC, say) a file. Some downloads happen over http, the protocol on which the web is based. Some happen over BitTorrent, which pulls the file from many different locations, in no particular order, and reassembles it on your side. Some downloads take place over secure protocols like SSH and SSL, and some are part of intelligent systems that, for example, keep your computer in sync with an encrypted remote backup.

Streaming describes a collection of downloading techniques in which the file is generally sent sequentially, so that it can be displayed before it is fully downloaded. Some streams are open-ended (like the video stream coming off your CCTV camera, which isn't a finite file, but rather continues to transmit for as long as the CCTV is up and running).

Some travel over UDP, a cousin of the more familiar TCP, in which reliability can be traded off for speed. Some streaming servers can communicate with the downloading software and dynamically adjust the stream to compensate for poor network conditions.

And of course, some streaming software throws away the bits after it finishes downloading them, rather than storing them on the hard-drive.

It's this last part that has the technologically naive excited. They assume that because a downloading client can be designed in such a way that it doesn't save the file, no "copy" is being made. They assume that this is the technical equivalent of "showing" someone a movie instead of "giving them a copy" of it.

But the reason some download clients discards the bits is because the programmer chose not to save them. Designing a competing client that doesn't throw away the bits one that "makes a copy" is trivial.

All streaming involves making a copy, and saving the copy just isn't hard.

Does this matter? After all, if the entertainment industry can be bought off with some pretty stories about a magical kind of download that doesn't make a copy, shouldn't we just leave them to their illusions?

What harm could come from that?

Plenty, I fear. First of all, while streaming music from Last.fm is a great way to listen to music you haven't discovered yet, there's no reason to believe that people will lose the urge to collect music.

Indeed, the record industry seems to have forgotten the lesson of 70 years' worth of radio: people who hear songs they like often go on to acquire those songs for their personal collections. It's amazing to hear record industry executives deny that this will be the case, especially given that this was the dominant sales strategy for their industry for most of a century. Collecting is easier than it has ever been: you can store more music in less space and organise it more readily than ever before.

People will go on using streaming services, of course. They may even pay for them. But people will also go on downloading. Streaming won't decrease downloading. If streaming is successful that is, if it succeeds in making music more important to more people then downloading will increase too. With that increase will come a concomitant increase in Big Content's attacks on the privacy and due process rights of internet users, which, these days, is pretty much everyone.

If you want to solve the "downloading problem" you can't do it by waving your hands and declaring that a totally speculative, historically unprecedented shift in user behaviour less downloading will spontaneously arise through the good offices of Last.fm.

There are more problems, of course. Streaming is an implausible and inefficient use of wireless bandwidth. Our phones and personal devices can be equipped with all the storage necessary to carry around tens of thousands of songs for just a few pounds, incurring a single cost. By contrast, listening to music as you move around (another factor that has been key to the music industry's strategy, starting with the in-car eight-track player and continuing through the Walkman and iPod) via streams requires that you use the scarce electromagnetic spectrum that competing users are trying to get their email or web pages over. Count the number of earbuds on the next tube-carriage, airplane or bus you ride, multiply it by 128kbps (for a poor quality audio stream) and imagine that you had to find enough wireless bandwidth to serve them all, without slowing down anyone's competing net applications. Someday, every 777 might come with a satellite link, but will it provide all 479 passengers with enough bandwidth to play music all the way from London to Sydney?

What's more, streaming requires that wireless companies be at the centre of our daily cultural lives. These are the same wireless companies that presently screw us in every conceivable way: charging a premium for dialling an 0870 number; having limits on "unlimited" data plans; charging extra for "long distance" text messages. They're the same wireless companies whose hold-queues, deceptive multi-year contracts, surprise bills, and flaky network coverage have caused more bad days than any other modern industry.

Why would we voluntarily increase our reliance on expensive, scarce wireless bandwidth delivered by abusive thugs when we are awash in cheap, commodity storage that grows cheaper every day and which we can buy from hundreds of manufacturers and thousands of retailers?

Especially when every streaming song creates a raft of privacy disclosures your location, your taste, even the people who may be near you and when you're near them that are far more controllable when you listen to your own music collection.

Finally, there's the cost of going along with the gag. The more we pretend that there is a technical possibility of designing a downloader that can't save its files, the more incentive we create for legal and technological systems that attempt to make this come true. The way you hinder a downloader from saving files is by obfuscating its design and by creating legal penalties for users who open up the programs they use and try to improve them. You can't ever have a free/open source downloader that satisfies the desire to enforce deletion of the file on receipt, because all it would take to remove this stricture is to modify the code.

An incentive to obfuscate code, to prohibit third-party modifications and improvements, and to weld the bonnet shut on all the world's computers won't actually stop downloading. But it will have anti-competitive effects, it will reduce privacy, and it will slow down innovation, by giving incumbents the right to control new entrants into the market.

Hard problems can't be solved with technical denialism. The market has spoken: people want to download their music (and sometimes they want to stream it, too). The supposedly for-profit record labels could offer all-you-can-download packages that captured the law-abiding downloader, and then they could retain those customers by continuing to make new, great music available. It's been 10 years since Napster, and the record industry's hypothesis that an all-you-can-download regime can't work because users will download every song and then unsubscribe from the service is not borne out by evidence. The fact is that most downloaders find cheap, low-risk music discovery to be a tremendous incentive to more consumption, as they discover new music, new artists, new songs and new genres that tickle their fancies.

Selling customers what they desire is fundamental to any successful business. If Big Content can't figure out how to do that, then we can only pray for their hasty demise, before they can do too much more damage to humanity's most amazing and wonderful invention: the internet.

This week we get the closest we can to Santa, in the form of robotics whizz kid Caleb Chung. He's the man behind the lovable dinosaur Pleo, and the equal parts lovable and irritating Furby. Kevin Anderson finds out what makes a good robotic toy and how his background as a street entertainer has helped advise him.

We also hear from Jeremy Allaire of Brightcove, who provide video hosting for the likes of Channel 4, BSkyB and the Guardian. Mercedes Bunz finds out whether they're more than just another YouTube.

Plus there's this week's news including filitering of web content in Australia, the end of Teletext in the UK, the latest turn in the Oracle takeover of Sun, and details of the Guardian's new iPhone app.

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