The company's head of PR has put out a fist-pumping set of figures to reassure its staff. But he seems to have left some analysis out. Never mind - we've put it in

Just before the weekend, Frank Shaw, one of Microsoft's top PR people posted a memo to his team which included a Rocky-style paean to the virtues of jogging uphill, but also a self-examinatory question: why is everyone looking at Apple and Google, and not at Microsoft?

The text of the memo is at All Things Daily, but far more interesting were the statistics that he chose to include in a morale-boosting blog post.

Thing is, as happens with many such statistics-wielding posts, they don't necessarily tell the full story. Just as you should not trust numbers given by an executive unless their share options and fiduciary duties to tell the truth about their company's performance depend on it, you should examine numbers like those paraded by Microsoft more closely - and look too at what has been left out.

So let's look more closely at what he offered on the Official Microsoft Blog:

(I'll point out that he clearly wrote it using Word, as it's full of insane markup such as "span" links opened and then closed immediately. Seriously, guys, this is not 1995 - you've got smart programmers, you can figure out how to export HTML from a text document.)

So, to work:
1
• 150,000,000 Number of Windows 7 licenses sold, making Windows 7 by far the fastest growing operating system in history.[source]

Analysis: absolutely true: Windows 7 has had a very successful launch into the market. Much the same sorts of statistics were bandied around for Windows Vista's launch, however; but that obscured the fact that many people and organisations were buying Vista licences and downgrading to Windows XP. However, Windows 7 appears to be more secure and significantly more user-friendly OS than Vista.

2
• 7.1 million: Projected iPad sales for 2010. [source]
• 58 million: Projected netbook sales in 2010. [source]
• 355 million: Projected PC sales in 2010. [source]

Analysis: hang on, Frank: didn't Bill Gates say in November 2001 when he showed off the tablet format that he was sure it would be the best-selling form factor in the US in five years? Yes he did, here's the source. So does the focus on PC sales (which includes Apple's computers, of course) mean Microsoft has given up on tablets?

3
• <10 Percentage of US netbooks running Windows in 2008. [source]
• 96: Percentage of US netbooks running Windows in 2009. [source]

Analysis: netbooks are an interesting area, and the fact that Linux made very little headway here is equally interesting. The links used for the source there point to the same Computerworld article about returns: people who bought Linux netbooks clearly couldn't understand why they couldn't run their Windows apps on them. I doubt anyone has taken their iPad back to the shop because it won't run Windows apps. That may argue to a failure of advertising on the part of the netbook manufacturers - which, given that they were competing against each other for razor-thin profits, is understandable. The shift to Windows on netbooks - though one might quibble, and suggest that Shaw is actually talking about market share, rather than the installed base running Windows - indicates that netbooks are supplementary to existing PCs. But I think we could guess that.

4
• 0: Number of paying customers running on Windows Azure in November 2009.
•10,000: Number of paying customers running on Windows Azure in June 2010. [source]
• 700,000: Number of students, teachers and staff using Microsoft's cloud productivity tools in Kentucky public schools, the largest cloud deployment in the US.[source]

Analysis: good numbers. Where's the comparison with the number of Google Apps customers, though, Frank? In October 2009 DailyFinance reported that it had passed the 2m mark.

5
• 16 million Total subscribers to largest 25 US daily newspapers. [source]
• 14 Million Total number of Netflix subscribers. [source]
• 23 million Total number of Xbox Live subscribers. [source]

Analysis: this feels very apples-to-oranges, though Xbox Live is definitely one of the great successes of the Microsoft's whole push into gaming - arguably, of gaming altogether. Not mentioned: the $1bn writeoff against faulty Xbox 360 consoles which had the red ring of death; Microsoft's continued faillure to make a notable profit from its Entertainment & Devices (E&D) division; Nintendo's dominance of the console market with the cheaper, more reliable Wii.

6
• 9,000,000 Number of customer downloads of the Office 2010 beta prior to launch, the largest Microsoft beta program in history. [source]

Analysis: 9m is a lot of downloads. Not shown: to what extent feedback from customers affected how the product worked in the end.

7
• 21.4 million Number of new Bing search users in one year. [Comscore report requires subscription]

Analysis: This sounds a lot, until you look at how long Bing has been going and how many users it has already, and the extent to which it has had to buy in some of those new users (via its now-discontinued cashback scheme, which was abandoned because it was the target of scammers). Bing is necessary opposition to Google, but it doesn't - yet? - offer a Unique Selling Point (USP) in the manner of, say, Wolfram Alpha.

Oh, and Steve Ballmer said in January that Bing added 11m users in 2009 - though of course that's since June 2009. Are you rounding up, Frank? At the same January point, comScore said Bing had raised its share of the search market from 10.3% to ... drum roll... 10.7%. If 11m users equates to 0.4% of the market, 21m isn't going to make much of a dent, frankly.

8
• 24% Linux Server market share in 2005. [source]
• 33% Predicted Linux Server market share for 2007 (made in 2005). [source]
• 21.2% Actual Linux Server market share, Q4 2009. [source]

Analysis: This is a really interesting one, because it is a distortion of reality that would have Steve Jobs applauding at its subtlety. You look at those numbers and think: wow, Linux servers really aren't popular. How odd, because you'll notice that you come across Linux servers all over the place: Google, Facebook (which runs F5's Big IP, which is Linux), Yahoo, Amazon, Wordpress.com (which hosts millions of blogs), Twitter... so why such a small number? (The only major site I could quickly find that runs Windows Server is eBay.)

Answer: because those "market share" figures are for Linux server licences sold. Microsoft doesn't count them - and because the market research companies can't count them - if money doesn't change hands. True, this indicates that companies selling Linux servers (principally hardware) aren't making headway against Windows Server. But what it doesn't tell you is what progress Linux is making overall on the web. For that, you need Netcraft. And that suggests that Linux has a really big market share.

Certainly, Microsoft's Windows Server business is holding up well, judging by the profit figures. But you won't find any small web startup using it; and you won't find any big web company using it, except Microsoft (update: and, obviously, eBay - as above). I once asked Google's open source advocate, Chris Di Bona, how much it would cost Google to run on Windows Server. He laughed a long time.

9
• 8.8 million Global iPhone sales in Q1 2010. [source]
• 21.5 million Nokia smartphone sales in Q1 2010. [source]
• 55 million Total smartphone sales globally in Q1 2010. [source]
• 439 million Projected global smartphone sales in 2014. [source]

Analysis: you've surely spotted the missing one here: Windows Mobile licence sales. Come on, Frank, if you're going to wave Nokia's willy at Apple, then surely you should be doing the same with Microsoft's mobile phone numbers? No? Perhaps that's because they're declining - having been passed by Apple - and Windows Phone, the upcoming phone OS, is a huge gamble in this space; which, if Microsoft gets it wrong, may be a stumble it can't recover from, especially with Android now growing rapidly - even faster than Apple, in fact. (But Apple isn't that troubled, as it gets the hardware revenues plus a slice of the app revenues.)

10
• 9 Number of years it took Salesforce.com to reach 1 million paid user milestone. [source]
• 6 Number of years it took Microsoft Dynamics CRM to reach 1 million paid user milestone. [source]
• 100% Percent chance that Salesforce.com CEO will mention Microsoft in a speech, panel, interview, or blog post.

Analysis: well, at least Frank Shaw has a sense of humour with that last one. Though if we're being pernickety, we'd point out that it should read "100: Percent chance..."

More to the point though, Microsoft Dynamics isn't a business that was built from the ground up, as Salesforce is; it's the result of two acquisitions in 2001 and 2002, and the Wikipedia page (if we can trust it; there don't seem to be any stats on the Microsoft Dynamics page) says there are 300,000 businesses that use Microsoft Dynamics applications and 10,000 Microsoft Dynamics reselling partners worldwide. Given that the companies pre-existed before Microsoft bought them, is that "6 years" milestone really so impressive? And: it would be helpful, Frank, to know how many customers Microsoft Dynamics CRM has now, and how many Salesforce (now 11 years old) has.

11
• 173 million Global Gmail users. [source]
• 284 million Global Yahoo! Mail users.[source]
• 360 million Global Windows Live Hotmail users.[source]
• 299 million Active Windows Live Messenger Accounts worldwide. [Comscore MyMetrix, WW, March 2010 - requires subscription]
• 1 Rank of Windows Live Messenger globally compared to all other instant messaging services. [Comscore MyMetrix, WW, March 2010 - requires subscription]

Analysis: Ignoring the fact that Hotmail was an acquisition (as it's so far back), it might be instructive to compare like with like. Gmail started on April 1 2003. At the end of 2003, Hotmail had 145m users. So in that time, Hotmail has put on 215m users, and Gmail - from a standing start - 173m. It's good for Microsoft, but not bad either for Gmail/

12
• $5.7 Billion Apple Net income for fiscal year ending Sep 2009. [source]
• $6.5 Billion Google Net income for fiscal year ending Dec 2009. [source]
• $14.5 Billion Microsoft Net Income for fiscal year ending June 2009. [source]
• $23.0 billion Total Microsoft revenue, FY2000. [source]
• $58.4 billion
Total Microsoft revenue, FY2009. [source]

Analysis:Microsoft remains the most profitable of this group of companies - that's not in doubt. What people wonder about is the extent to which it can maintain growth, and whether that growth will be robust: will PCs become outdated? Will we all start using smartphones? Will we abandon desktop apps for web-based ones, or paid-for ones for free ones? That's still unclear.

Frank Shaw's efforts to boost the troops is laudable, but if all you do is look at the numbers, you're missing a big chunk of the story around Microsoft just now. It's a big and strong company - but perhaps not quite as strong as some of these numbers might make you think.

The chief executive of the search giant believes smartphones will empower the poor and is the equivalent to the arrival of TV

Phenomenally successful, but also imitated, envied and feared Google is the technological icon of our time. But is its ubiquity and influence a force for good?

Chief executive Eric Schmidt has no doubts. He tells the Guardian that Google has been instrumental in a generational shift in democratising information. "Over my lifetime, we are going to go from a small number of people having access to most of the world's information, to virtually everybody in the world having access to virtually all of the world's information," he said. "That's because of web search, cheap phones and automatic translation. That's a pretty amazing achievement and Google is part of that."

Yet with Google active in so many areas, from shopping to video and translation to music, its competitors are becoming more numerous and opponents more vociferous. Schmidt admits: "We try to do everything We don't shake off the big goals."

In an interview ahead of his keynote presentation at the Guardian's Activate Summit on Thursday, he makes it clear Google is positioning itself for the future through mobile, with the development of its Android mobile system and with subsequent Google-branded handsets. He is keener to talk about this area than the battle with newspaper groupss such as News International, whose paywall model is partly based on what it considers Google's parasitical attitude to original content.

The mobile battle pitches the three biggest tech firms against each other: Google, Apple and Microsoft. Analyst Gartner puts Android as the world's fourth most-popular smartphone operating system in the first quarter of 2010 ahead of Microsoft in a market it joined less than two years ago but behind Symbian (Nokia), Research in Motion (Blackberry) and Apple.

"I believe that the very best engineering is now going on the mobile devices the hardest problems and the most clever solutions," says Schmidt. "You know who the person is and where they are, and you don't get that from a desktop app." The 50,000 apps built for Android, mostly by third-party developers, cover almost every topic, but the one killer app is still Google itself, says Schmidt.

Schmidt describes how our online lives are now more personal, social and mobile. "When people are awake, they are now online, and that has a lot of implications for society and for Google," he says. Google's secret, he adds (though it's not much of a secret), is that it can handle more data than its rivals because it has larger networks and data centres. Google in effect pulled its business from China earlier this year after moving the operation to Hong Kong, bypassingChina's censorship regime. Google, whose company motto is "Do no evil" had been heavily criticised for its decision to do business in China and its rethink was welcomed by the industry. It also increased pressure on rivals who still operate there.

"Google doesn't necessarily do things that other companies do. We have our own set of principles that we work hard on. In the China case, the decision was made not for revenue it was about what we were willing to deal with. We want to be a good global citizen and we believe very strongly in the openness of information."

Another key push from Google is encouraging governments to open information to the public, via formats that developers can build useful public services around. One recent victory for open data campaigners in the UK was Transport for London opening its travel data for commercial use, but the coalition government has indicated it may establish a broader public "right to data" that will have to be provided by local and national authorities.Schmidt says Google's policy is to encourage governments to open their data to the public. The California-based company has teams helping to prepare "non web-resident" archives and databases for the web. "It is no longer acceptable online for government researchers to publish documents read by 500 people in printed form," he says. "It needs to be web first.

Once that happens, there are lots of interesting things you can do to correlate real-time information, if that is what is needed, or put it on a map ... government services are fundamentally about where people are, about what is going on in my town or my school."

These projects are just as relevant in developing countries, where the introduction of smarter, cheaper phones has created a powerful network. How does Google help developing countries break through the digital divide, and ensure the opportunities of the web are open to all? "Hardware manufacturers are being incentivised to make higher volumes of lower-priced mobiles, and prices have fallen dramatically. But a young person now in pretty much any country, if they have a mobile device, can get access to pretty much all the world's information and get it translated into their own language."

Arriving at Google in 2001 after a career spent in Silicon Valley, Schmidt is still excited by its possibilities. "That's a big news thing that's equivalent to the arrival of television."

For more information on the Activate Summit, visit guardian.co.uk/activate

Chief executive Steve Jobs hails 'most successful launch in Apple's history' despite reported problems over phone reception

Apple says it sold 1.7m iPhone 4s in its first three days, a record for the newest version of its top-selling product, and the company could have sold more but for production constraints. The latest model features video calling and an updated body, although some users have reported problems with reception, apparently due to a design flaw.

Steve Jobs, Apple's chief executive, called the iPhone 4's launch "the most successful in Apple's history" but added: "We apologise to those customers who were turned away because we did not have enough supply."

Research in the US by the analysts Piper Jaffray and in the UK by AQA suggests that 77% of iPhone 4 buyers queueing outside stores on the first days were upgrading from previous models implying that 23% of buyers were new to the platform.

The record sales have come despite shortages of the smaller-capacity 16-gigabyte version of the iPhone, which is coloured white. Apple apologised last week and said it would be unable to fulfil early demand for them. By comparison, the previous iPhone 3GS model, launched a year ago, sold 1m in its first weekend.

Apple is competing for market share in the smartphone arena with RIM, maker of the BlackBerry brand; Google's Android software, which is used by multiple handset makers; and Nokia, which has the lion's share of the smartphone market but which has seen its share and profitability shrink since Apple and Google entered the market in 2007.

Analysts reckon Apple will be able to sell plenty more of the devices: Colin Gillis of BGC Partners in New York and Andy Hargreaves of Pacific Crest Securities in Portland, Oregon, project that Apple will have sold 2m to June 26, the end of the company's fiscal quarter. Gene Munster, an analyst at Piper Jaffray in Minneapolis, had previously estimated 1m to 1.5m.

Apple had a difficult time getting enough touch screens to meet demand for the device, said Ashok Kumar, an analyst at Rodman & Renshaw in New York, so the early sales figures may not be an accurate reflection of demand. "It's too early to say if this is negative," said Kumar.

While Apple has some production constraints, the company "has a captive audience", he said. "Demand for the iPhone 4 is not yet satiated so it just gets pushed out into subsequent quarters."

The iPhone sales results follow Apple's statement last week that it sold more than 3m of its iPad tablet computing device in the first 80 days. With the iPad, introduced April 3, and the three-year-old iPhone, Apple has widened its business beyond the Macintosh computer and iPod media player.

Sales of the iPhone accounted for 40% of Apple's revenue last quarter. The device has shown an upward trend in sales: the first sold 700,000 on its first weekend in June 2007, despite a high price that was later cut. In 2008, the iPhone 3G sold 1m in its first week.

Apple's share price has more than doubled since the original iPhone's release on 29 June 2007, and it passed Microsoft as the largest technology company by market value late in May.

Some iPhone 4 customers have reported trouble with the new antenna design, which uses a stainless steel band on the outside of the casing. The phone signal drops when users cover the bottom left corner of the device with their palm.

Apple responded by recommending holding the phone differently or using a case to solve the problem. Customers in the five countries began lining up days in advance to buy the device. Apple said the iPhone will be available in 88 countries by the end of September.

Owners of Apple's latest phone are resorting to a bit of duct tape or a dab of nail polish to solve its reception problems

Want to know the must-have item for owners of the new iPhone 4? A bit of duct tape or a dab of nail polish.

The reason: despite Steve Jobs's describing the positioning of the antennae which pick up the mobile signal on the outside of the phone, rather than the inside, as "brilliant engineering", a number of users have discovered that if it is held from the bottom, the signal strength drops off dramatically because their skin changes the electrical properties of the antennae.

Now, Jobs has informally and Apple formally acknowledged the issue: in email replies to owners of the new phones complaining about the problem, Jobs gave a simple response. "Don't hold it that way," he told one.

Apple's slightly longer statement notes that: "Gripping any phone will result in some attenuation of its antenna performance with certain places being worse than others this is a fact of life for every wireless phone. If you ever experience this on your iPhone 4, avoid gripping it in the lower left corner in a way that covers both sides of the black strip in the metal band, or simply use one of many available cases."

Some users have found tape or nail polish on the corner is a solution.

With the iPhone 4 having been a sellout in many stores and Vodafone emailing customers whom it promised supplies to tell them that it cannot satisfy them the problems are an embarrassment for Apple, which had to overcome early problems with wireless reception on its tablet-style computer, the iPad, when that was launched in May.

Dozens of people have posted videos on YouTube showing how the signal reception for 3G voice and data networks falls off when it is held so that the hand touches the antenna parts on the bottom of the phone. Companies selling silicone casing for the iPhone 4 report that they have already been busier, as word of the problem has spread, than they were for last year's release of the iPhone 3GS.

Professor Joe McGeehan, head of the Centre for Communications Research at the University of Bristol, and an expert in mobile antenna technology, said: "The hand does have a de-tuning effect on the antenna of any mobile phone: it changes the frequency that it responds to due to capacitative effects. How much it affects it depends on the materials surrounding it. If previous iPhones didn't have this problem, then you have to ask: what's changed, and might that be causing it?"

Antenna expert Spencer Webb said all mobile phones house the antenna in the bottom of the phone, to minimise the radio output near the head so that the phone will pass safety testing by the US Federal Communications Commission (FCC). "The iPhone 4 has two symmetrical slots in the stainless frame," Webb wrote. "If you short these slots, or cover them with your hand, the antenna performance will suffer. There is no way around this, it's a design compromise that is forced by the requirements of the FCC, AT&T, Apple's marketing department and Apple's industrial designers, to name a few." He said he had upgraded to the new iPhone, despite the concerns. "I voted with my dollars," he said. "Sometimes an antenna that's not great, but good enough, is good enough."

Apple offers a solution: "bumpers" which fits around the edge of the phone. But at 29, they are too pricey for many to consider and have not pleased people who think their phone should work correctly out of the box.

It must be magic: Lego Harry Potter zaps Red Dead Redemption from its month-long reign at the top of the chart

Leisure software charts compiled by GfK Chart Track
2009 ELSPA (UK) Ltd

The games industry is facing a brain drain after the coalition government reneged on its promise to give it tax breaks

The British video game industry is in shock. Barely two months ago, Alistair Darling planned a series of tax breaks for the sector in his final budget. But last week, amid a range of painful austerity measures, George Osborne reversed the decision, calling Darling's plans "poorly targeted".

It is a hammer blow for UK game companies, who are losing out to rivals in countries such as Canada, the US and South Korea, where generous tax subsidies are available to games employers. Richard Wilson, chief executive of the industry's trade body Tiga, called the decision "a big mistake" and was furious at what he sees a "betrayal" of promises. "Before the general election the Conservatives and the Liberal Democrats both explicitly stated that they supported tax breaks for the video game industry. In fact, the Conservatives said that Labour had stolen their idea."

Wilson is right to be enraged. It may be difficult for the rest of us, reeling from VAT increases and frozen child benefits, to have any sympathy for the makers of computer games. But the UK industry has, up until now, been one of our rare unmitigated success stories a vibrant, globally respected sector, producing such famed franchises as Tomb Raider, Fable, LittleBigPlanet and Lego Star Wars. We were once the third-largest producer of games in the world, and last year the industry managed to bring 1bn in to the British economy. Cameron loves to talk about moving away from relying on the public sector and financial services well, David, the video game business could have been part of your way out. It's export-orientated and cutting-edge, has highly skilled employees, and it's even low on carbon emissions.

But the signs of strain are showing. It is expensive to make games in Britain, and expensive for foreign investors to set up and support studios here; Wilson states that between 2008 and 2009, 15% of UK development studios went out of business. Meanwhile in Quebec, the government subsidises a third of the salaries paid out to development staff amid a range of other compelling initiatives. No wonder Electronic Arts, Square Enix and Warner Bros all have new studios in Montreal. And no wonder the UK is suffering a brain drain. The period between March 2009 and 2010 saw the loss of over 700 jobs in British games development. About 300 is believed to have gone to Canada. When my brother-in-law, a game designer, was made redundant from his UK firm five years ago, he was snapped up by Ubisoft Montreal.

There are no major UK-owned games publishers left, they've either gone bust or been bought out by foreign giants. The UK is now an outsourcing nation, competing for work with countries in Eastern Europe and the Far East where the workforce is cheap and skills are improving. There are growing parallels with the UK movie industry, once a major producer and maker of films, but now scraping by on limited funding. "We'll lose jobs, we'll lose influence, the UK games industry will not be world-leading," warns Wilson.

UK games companies have forged creative and commercial links with other sectors, from universities, to the fashion, animation, movie and TV industries. British games veterans are helping to shape the future of interactive TV, the growth of 3D technology and the pervasive "gamification" of consumer products and services in every area of business. How long will that continue?

The one bright spot in all this is Osborne's wording. His reference to the tax plans as poorly targeted, may indicate he's looking to review rather than abandon support for the industry. "I was surprised by those words," says Cliona Kirby, a partner in the tax group at technology law firm Olswang, who completed a report on video game tax credits for Ed Vaizey. "But then it's incredibly hard to introduce a targeted tax break for any one industry in the current economic climate, especially when we're looking at tax rises and large public sector cuts. But I believe the Conservatives are still committed to the industry." I'd like to agree but future initiatives may have to be spread out across the entire creative sector.

Certainly though, if there is a will there to aid this industry, Tiga will unearth it. Wilson will continue to lobby for tax breaks, as will Elspa, the video game publishers' association. The coalition government could do with an economic success story to rally behind. Video games are a popular component of our leisure time and there's only so much austerity we can take.

The content WikiLeaks has released has been shocking. So why has it has had so little effect?

The story of WikiLeaks.org is the story of both the modern whistleblower and the structure of the modern media system. The site is now famous for embracing technology in order to protect sources behind material that might be damaging to institutions as varied as the Church of Scientology, Swiss banks and the US military. Yet despite shocking revelations and damaging material emerging from the site, very little has actually changed because of them. This ought to be troubling, but there is a way to explain it.

Julian Assange, the notoriously elusive Australian mastermind of WikiLeaks, has built the site like any good hacker would. WikiLeaks protects itself in a few cunningly simple ways. First, it receives information from sources via accredited journalists, thus protecting itself upfront behind various international press freedom laws. Then the information is routed through servers in Sweden, a nation with stringent whistleblower laws that assure the anonymity of sources in digital media. Finally, the information is also encrypted, and requires skilled volunteers to decode it before it appears online.

In a recent article in the New Yorker, Assange summed up the power of WikiLeaks. He told the magazine that "a government or company that wanted to remove content from WikiLeaks would have to practically dismantle the internet itself."

In effect, WikiLeaks has managed to carve out a place at the edge of the media-industrial complex. It has revealed exactly the point where the accepted dichotomy of good versus evil begins to break down. Like the whistleblowers before them, those who contribute to WikiLeaks are essentially asking us to question the accepted narrative, suggesting that our concept of individual freedom inherently accepts a degree of coercion from those in power.

Though many lauded WikiLeaks' release of the Collateral Murder video depicting two US Army helicopters firing on a group of men in Baghdad that included two Reuters journalists, others weren't so kind. After the video's release there was speculation about WikiLeaks' agenda, and whether both the editing of the video itself and the title given to it unfairly contextualised the content. But that was never really a concern for WikiLeaks. After all, it doesn't aim to tell the entire truth, just some of the details of the greater meta-narrative. Its agenda is to poke holes in what it perceives as the veil of the accepted version of democratic liberty, which hides secret tyrannies.

This is also why the setup WikiLeaks has perfected is virtually bulletproof. Assange's assertion that to destroy the site, one would have to dismantle the very medium through which it operates, also speaks to WikiLeaks' agenda. The internet is predicated upon the very same ideas of personal freedom and expression that WikiLeaks suggests are partially fabricated by authority. To destroy the site would be the ultimate exposition of the accepted system as exactly what Assange suggests it is: reactionary, violent, controlling and above all interested only in its own preservation.

As such, WikiLeaks' goals are clear: it seeks to damage that framework by achieving maximum impact for any piece of information it releases. Why hasn't it been more successful?

WikiLeaks is reportedly preparing to release another video, this time of an air strike in Afghanistan against what the US government says were mostly insurgents. Afghan authorities claim that the majority of the victims were innocent civilians. No doubt it will attract the same kind of attention that "collateral murder" did. So it might be prudent to examine why, despite making massive media waves initially, that video altered neither the US government's approach to Iraq, nor the view of the general public overall.

For all the freedom that the internet grants users, we still ask that the kind of information in "collateral murder" be interpreted for us. That interpretation and contextualisation of the footage took place on a more traditional medium: TV news and opinion programmes. There it fell victim in the very system it tried to undermine. It became part of a homogeneous message of The Way Things Are.

The "collateral murder" video has been viewed almost 7m times on YouTube that's 128 times fewer than the video for Miley Cyrus's Party in the USA. That comparison might seem silly, but it hints at a bigger problem. That is, the "collateral murder" video, as it became a part of the usual TV structure of message-advertisement-message, was reduced to an equivalent of all other parts of the usual pattern of disarticulation and abstraction of signs. In essence, "collateral murder" was overshadowed by a Miley Cyrus video because, in the end, it became part of a structure inherently designed to nullify its message by promoting the status quo of the culture industry.

So, as much as WikiLeaks thrives in its online setting, its information still falls prey to the sameness of modern media. Even if someone were to see the video on YouTube, the same mechanisms prevail, with all information including web advertisements and other videos being presented as equal. Effectively, the only way one can view a WikiLeaks video without that influence is on the site itself, where it lives within certain confines, and with less influence.

The reason even major leaks coming from WikiLeaks haven't had a more profound effect isn't due to the site: it's thanks to us. Even though WikiLeaks has done an impressive job of ensuring its existence and safety, our endless adherence to the influence of the culture industry prevents us from truly internalising and acting upon the information the site presents. If we're not aware of that, we'll continue to fall victim to exactly the kind of censorship that WikiLeaks aims to destroy.

Move intended to save millions will see remaining sites forced to cut costs by up to 50%

Hundreds of government websites are to be scrapped in a move that will save millions of pounds, the cabinet office announced today.

Up to 75% of the existing 820 government-funded websites could be shut down, with those that remain forced to cut their costs by up to 50%.

A review of all existing sites will look at cost, usage and whether existing sites can better share their resources.

The move was announced as a Central Office of Information report was published on 46 government websites that cost 126m between them.

The report showed uktradeinvest.gov.uk cost 11.78 per visit, while businesslink.gov.uk cost 2.15.

However, UK Trade and Industry said the figure quoted for its website was "incorrect and completely misleading" because it only applied to 20% of traffic to its former site and it had now been replaced by a more cost effective version.

The cabinet office also said it had anecdotal evidence of government sites competing against each other, citing the examples of the Department for Energy and Climate Change and the Energy Saving Trust bidding against each other for Google search terms and some quango websites competing with central government ones.

The cabinet office minister, Francis Maude, said the Labour government had committed to "dramatically culling" the number of websites in 2006 but failed to make good on that pledge.

"This government is completely committed to getting the government web back under control," he said. "The days of vanity sites are over.

"It is not good enough to have websites which do not deliver the high quality services which people expect and deserve. That is why we will take tough action to get rid of those which are not up to the job and do not offer good value for money, and introduce strict guidelines for those that remain."

Maude said that the government's new digital champion, the internet entrepreneur Martha Lane Fox, would be advising on how to put key public services online and increase the number of people able to use the web.

But the former culture secretary Tessa Jowell claimed Labour had shut down more than 1,000 websites and warned that the coalition's government's plans risked being a "false economy" .

"Putting services online is not only more efficient, but often it is cheaper as well," she added. "The measures announced today ... may end up costing the government more money than it is looking to save.

"In the last two years, the Labour government already reviewed 1,795 websites, of which more than 1,000 have already been closed."

The cabinet office said no new websites would be permitted unless they could prove to the efficiency board, co-chaired by Maude and the chief secretary to the Treasury, Danny Alexander, that they were "special cases".

The report on government websites is scheduled to be completed in time for September's spending review.

Video-on-demand joint venture expected to go live next year, but could face further challenges from rivals

The BBC Trust has approved the launch of Project Canvas, the BBC-backed venture to bring video-on-demand to Freeview and Freesat, subject to a number of conditions including an investment cap for the corporation.

Today's final approval, which follows provisional clearance in December from the BBC Trust , finally clears the way for Project Canvas to launch, although it is not expected to go live until next year.

However, rivals BSkyB and Virgin Media, who have objected to Project Canvas on a number of grounds,, could look at new avenues to block the launch.

BskyB has questioned whether the BBC should be involved in such a commercial

service. And the Office of Fair Trading, which in May said it would not investigate the Project Canvas's partner structure as a merger situation, nevertheless said that its decision "does not preclude the application of other provisions of competition law and other relevant legislation".

Project Canvas, which is likely to be called YouView a hybrid of YouTube and Freeview has been given the green light with a number of conditions attached to the BBC's involvement.

These include a guarantee to properly engage with industry, a thorny issue that has led to criticism from industry trade body the Digital Television Group.

Technical specifications for the platform must be published within the next 20 days and "final core technical specification will be published no later than eight months before launch of the first set-top boxes".

Project Canvas must always remain free-to-air but users "may be charged for additional pay services that third parties might choose to provide via the Canvas platform, for example video on demand services, as well as the broadband subscription fees".

Access to Project Canvas must not be "bundled with other products or services" and "listing on the electronic programme guide will be awarded in a fair, reasonable and non-discriminatory manner".

The BBC must also make sure that it does not breach EU state aid rules and the corporation must "not exceed the [BBC] executive's estimated costs by more than 20% over a five-year period".

"The BBC Trust has concluded that Project Canvas will deliver significant public value for licence fee payers," said BBC trustee Diane Coyle. "People with a broadband connection will be able to access a wide range of on-demand content including BBC iPlayer, free of charge, through their TV sets. We have however applied a number of conditions to the BBC's involvement in the venture in recognition of the potential impacts on the market if Canvas is successful."

The BBC Trust said it will review the BBC's involvement in Project Canvas a year after it launches.

The trust has said that the cost of Project Canvas, including development, launch, and to the end of the first four years it is running, will be 115.6m. Each partner is expected to pay an equal share.

BBC trustee Diane Coyle, who is chair of the trust's strategic approvals committee, said the success of Project Canvas depended on "open engagement" with the industry and that the conditions put in place today had been "welcomed" by the Digital Television Group.

A target launch date of April next year has been set for the launch of the new service. Coyle said she was not aware of any moves by rival operators to block the launch.

"There have been some issues raised by Sky and Virgin [Media]," she said. "We have gone through a very thorough and transparent process. We are entirely comfortable with the competition issue ourselves. If people want to bring a complaint, they can do."

"A lot of the issues raised during the consultation were about engagement with the rest of the industry. There is nothing in the trust conditions that affects whether or not Virgin joins Canvas. We are pretty happy that it is an open platform."

Coyle said the leeway allowed to BBC management to go 20% over budget was "just realistic given the nature of devising a technology platform. In any BBC budget there is 10% flexibility. It seems sensible".

The BBC had initially been expected to spend 24.7m on the new technology over five years, but the introduction of new partners means this is likely to be reduced to 16.4m.

She said Canvas was an "exciting opportunity" to bring new content into people's living rooms, and said she expected the BBC to "take the lead" in building partnerships with creative organisations such as museums and art galleries.

A spokesman for Virgin Media said: "We are disappointed the BBC Trust has approved Canvas and ignored the significant concerns raised by the commercial sector about the proposal. Our position on this matter remains unchanged. As it stands, Canvas will severely restrict competition and innovation and ultimately this will harm consumers."

A spokesman for BSkyB said: "The BBC's involvement in Canvas is an unnecessary use of public funds.

"The BBC Trust's announcement is a predictable decision from a body that has shown little inclination to think independently or set meaningful boundaries on the BBC's activities."

 To contact the MediaGuardian news desk email editor@mediaguardian.co.uk or phone 020 3353 3857. For all other inquiries please call the main Guardian switchboard on 020 3353 2000.

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Russia, Japan, China and Japan only remaining countries where Facebook not leading social network says founder

Facebook's global dominance is almost complete with just Russia, Japan, China and Japan yet to be converted and the social networking giant aiming to reach 1 billion users, founder Mark Zuckerberg revealed today.

Zuckerberg, who said he had recently met Prime Minister David Cameron "for just a minute [when] he was busy rolling out the budget", also admitted that one day he could see Facebook floating on the stockmarket just not anytime soon.

He added that there was "no chance" Facebook, which has cracked the 500 million user mark, would hit 1 billion this year but argued that "it is almost a guarantee that it will happen".

"If we succeed [in innovating and remaining relevant] there is a good chance of bringing this to a billion people it will be interesting to see how it plays out," he said speaking to two packed auditoriums one via video link at the Cannes Lions International Advertising Festival.

Facebook's global domination is almost complete, he said. "We are down to just four countries where we aren't the leading social network."

Zuckerberg added that in Russia Facebook had just 1 million users, the kind of numbers that saw AOL sell off Bebo and ITV relinquish Friends Reunited. But in Facebook's case, growth is "doubling every six months", according to Zuckerberg, and Japan and Korea have similar user bases.

He said that Facebook can tell when an explosive growth "tipping point" is about to be reached by who is "friending" who. When Facebook first launches in a country, nearly all the friend connections are with foreign Facebook users.

"We know that a country has tipped when local-to-local connections outnumber local to foreign," he added. "It is a long-term thing [and with regard to the four left to tip] we are probably not going to win in six months, not in a year [but] things look promising in three to five years out."

He also said that the company would make an initial public offering. "At some point, sure," he said. "It is probably not that different [running a public company compared with a privately held one]." However, after many sceptical guffaws in the Cannes audience he backtracked and said: "OK, I'm sure it is a lot different."

Zuckerberg added that one of the issues was that he was in it with a long-term view, which most investors are not if you go public, which he admitted was a "challenge".

He also addressed concerns over privacy, explaining that Facebook's meteoric growth had meant the company had been caught out while it was in "transition". However, he added that the changing face of how privacy is perceived now that users are in a digital age meant that there were always going to be "natural tensions".

"Six years ago most people didn't want any information about themselves on web," he said. "To start off people were a bit reticent about this. Then over time people think it is great to be connected and share things. I think the world looks a lot different now. There is a real natural tension between people seeing the value of sharing more stuff but wanting control over what they share."

Zuckerberg added that as Facebook developed it built privacy controls for everything. At one point there were more than 100 individual settings users could change, which it had been important to simplify as the company had to "transition [and be] pretty quick to adjust and evolve to 500 million users".

"People have very legitimate questions and it is an important dialogue," he said.

To contact the MediaGuardian news desk email editor@mediaguardian.co.uk or phone 020 3353 3857. For all other inquiries please call the main Guardian switchboard on 020 3353 2000.

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The transcript of the phone call earlier this week with Google's chief reveals the real signals he's sending out: Android wants to be the Windows of mobile phones

Android is getting too big to ignore. Photo by mathrock on Flickr. Some rights reserved

Below is a transcript (taken with shorthand, contemporaneously) of a conference call with Eric Schmidt, chief executive of Google, on 23 June. There may be some inaccuracies. After that, there is an analysis of what Schmidt said - and where the mobile market is.

Also on the conference call were journalists from Germany, the UK and Brazil. I won't indicate here who asked what questions; see if you can work it out.

Call begins

Eric Schmidt: Verizon is just announcing the Droid X made by Motorola, its fourth Android phone. We have seen a tremendous increase in the adoption of Android. This is one of the best phones ever made, on the very fastest network.

We've now got 160,000 new users per day. That's a 60% increase per month [compared to the 100,000 figure per day that was given at the Google I/O conference in May]. If you get an increase like that going on, well, I've done the maths, and it looks like an incredible trajectory.

[That equates to 58m per month, a 60% increase month-on-month would mean that by the end of the year there would be about 16m Android phones being activated every day, or 480m per month - which doesn't really sounds feasible. Obviously it is going to tail off or even slow down at some stage.]

Counting the number of apps, there are 65,000, compared to 50,000 a month ago. So the growth is accelerating. OK, questions?

Q: How large is Android in the US market and European market compared to the iPhone, because it hasn't done too well in Europe?

ES: I prefer not to talk about the iPhone as a competitor. The growth rate is very very strong, but I don't think it's really appropriate to make claims about market share.

Q: What's driving that acceleration?

ES: having multiple hardware partners - LG, Samsung, HTC, Motorola. The thing is it's a totally open platorm, so open that the source is available too. Any application can run on Android as long as it doesn't damage the network.

Q: Android is lagging in Europe compared to the US - why do you think that is?

ES: I don't know that it's lagging; I would have to look at the numbers. It was launched first in the US but we have enough European partners. The Droid phone was a big driver.

Q: Have you made any contacts with Nokia to discuss Android on Nokia?

ES: We have talked to everybody... I don't want to talk about any specific companies. [A rather odd response which tailed off amid expectation.]

Q: What sort of revenues are you seeing from Android?

ES: We make zero from it. Because it's free. (Q: but you get advertising revenue from it...) We don't break out what our mobile advertising revenues are... [in general] we make money when people have powerful broadband devices so we invest in Android so that people can invest in it. But our mobile revenue growth is very very quick.

We know that there will be a great deal of money made in ads from the mobile industry.

Q: Do you think Android can become for mobile what Windows was for the PC?

ES: well, the thing about Android is that anybody can use it.. Android in many ways is better than Windows because it's free, rather than Windows which had an ever-increasing price point. So anybody can build on Android, and it's free.

Also Android has GPS and a full media stack [possibly misheard], so it can do things that even the ordinary PC doesn't have and might never have.

Q: Who is your biggest competitor in this fight - Apple, Nokia, who?

ES: I try to spend time not focussing on those questions. Nokia has the largest market share, certainly. Apple, I was a proud board member there, I respect them. Nokia and Apple are both highly organised to be competitive.

Q: Isn't a problem with Android that of fragmentation of the platform - that some handsets can't update from earlier versions either because of the networks or the phones, so people are stuck on older versions which means you're trying to cope with a broad range of versions?

ES: That's a very good question. The first thing to say is that the networks are quite interoperable. Some phones shipped a year ago can't be upgraded. But most can be, to 2.2, though it might take some months to roll out.

The argument about fragmentation has been used by competitors of open source for years. But we agree to support compatibility at the platform level. It's important to understand this. Android apps will work on the current generation; any Android app written for one version will run on any phone with that version. That prevents fragmentation. Apps are written on a per-OS basis. But of course not every app written for any version will run on every version of Android - otherwise the platform couldn't evolve.

Q: A team at Larva Labs estimated that while Apple has paid developers $1bn from App Store revenues, the comparable figure for the Android Marketplace is about $200m. Is enough money going to developers to make Android attractive?

ES: Well, I haven't seen those figures, so I can't talk to them. The thing is, developers go where the volume is. That's the most important lesson from platform economics. It's about scale and volume. It's very important that developers get to a scale where they can see the ability to get to a very large audience. We believe we have done so.

Q: We've seen other companies talking about Android-based tablets - does Google intend to produce a tablet running Android?

ES: We've seen a number of announcements from other companies about tablets running Android. It's a reasonably obvious product extension that people have announced. We haven't announced any form of Google tablet.

[end of interview]

Analysis: the timing of this announcement - on 23 June, just as Apple's iPhone 4 was reaching its first customers - was clearly aimed at taking some of the shine off the iPhone announcement by implying that even if Apple activates 1m iPhones in the first sales burst, Android will almost match that in a working week. (Do the maths.)

That of course leaves out all sorts of maybes, gotchas and provisionals: are the activation figures volatile? What's the churn like - how many of the activations are new customers, and how many are renewing customers? An interesting calculation from the analysts Piper Jaffray, via Fortune suggests that (in the US, at least) 77% of iPhone 4 customers were existing iPhone users.

You can look at that two ways: what an enormous number of renewals! Or you could look at it from the other end: wow, Apple grew its customer base for first-day iPhones by 23% - among people who had to wait in enormously long lines. What's the last consumer product you recall people queueing through the day for? I recall how Microsoft managed the hype machine perfectly for Windows 95, with midnight store openings; rather less so for every subsequent OS release. The Xbox 360 got some dedicated queuers too.

But in truth, Schmidt really isn't looking at iPhone sales; he's not trying here to court buyers dithering between iPhone and Android. This was actually a piece of dog-whistle PR aimed at mobile developers.

Unfamiliar with dog-whistle PR? It's like dog-whistle politics: aimed at a particular group, couched in terms which don't say a lot to the average person, but which zero in on that target group and make them sit up. The people who Schmidt wanted to hear this latest bit of PR are mobile developers. He wants them to multiply 160,000 by 5 (working days - perhaps 6), and then by 4, to reach about 4m Android phones being activated per month, and to get them to think that this is a really good platform to be building for.

That's the point of his "platform economics" answer. Google can only capitalise on mobile advertising once it gets Android to a specific market share. It seems like that it has already crossed it, since it's by all accounts bigger than Apple in smartphone share in the US (and may even be challenging RIM, though still some way behind Nokia). What the numbers are like for Europe - well, we'll have to wait a couple of weeks for the end of the quarter for all those numbers.

The interesting challenge though will be whether the Android platform will indeed become the Windows of mobile. That could cut both ways: sure, the handset makers don't have to pay a levy to use Android (as PC makers do to Microsoft). But when they go to the networks (who are the equivalent, in this scenario, of PC purchasers) they may find that they're forced to bid down, and that their margins get eroded as more rivals pile into the market.

Apple, meanwhile, can be entirely happy with not having the lion's share of the market, yet making a colossal profit from both the hardware sales (because nobody else can make an iPhone) and the app sales. It does exactly the same in the computer market: it has about 5% market share worldwide, yet makes a stonking profit on every computer sold. PC manufacturers, by contrast, have long since reached the point where price-cutting to win share simply opens a vein in their profits.

Android could thus win - and for Nokia, the idea of using Android must look ever more enticing, since it would cut costs and let it use its heft with the networks to win back share - and yet the hardware makers would lose. That's a great danger - not imminent, but it exists - for Schmidt, Android and Google. By creating a flourishing ecosystem of app developers, Android could make life better for the handset makers.

Oh, and the company we haven't mentioned here at all, except in passing? Microsoft. If you look at what the Android and iPhone platforms are now doing, you have to ask how on earth Windows Phone - which will have a paid-for licence - is ever going to attract any handset makers. Schmidt's Android dog whistle might be loud for iPhone developers annoyed at the company's capricious treatment of their apps, but it must be loudest for developers considering whether the shrinking, forwards-incompatible pool of Windows Mobile phones is really worth bothering with.

Between the handset makers pondering the economics of paying for a Windows Phone licence, and developers wondering why they should write code for a platform, Windows Phone, that's presently activating zero phones a day - because it hasn't been released - versus one doing 160,000 per day, Microsoft has a real problem with Windows Phone. Apple can survive Android because it has that 77% base of loyal customers. Android has an expanding customer base.

But what on earth has Microsoft got?

* I asked the questions about fragmentation and Larva Labs.

The news entrepreneur explains why the future lies in innovation and why tech conferences are the place to be

News innovator Nonny de la Pe a on developing the media's future

Last week, Stroome, a media startup intended to speed the editing and distribution of video throughout the world was one of 12 projects to win the Knight Foundation's 2010 News Challenge, an award for initiatives likely to 'impact the future of news'. The California-based startup, run by Nonny de la Pe a and Thomas Grasty, researchers at University of Southern California, will be awarded $200,000 ( 133,500) in order to continue developing the project.

Launched officially in April 2010, Stroome aims to connect journalists, filmmakers, travellers and anyone else with a video camera, allowing them to upload their films to the internet and then collaborate with other users to create new video, audio, and photo mashups from every corner of the world.

While the Stroome community is still small, with only 500 members based in 40 countries, the opportunity and potential for growth is substantial: think YouTube and Wikipedia rolled into one big creative melting pot.

In London this week, De La Pe a spoke about where Stroome fits in the new media landscape.

Where did the idea for Stroome come from?

I'm a former correspondent for Newsweek magazine and the way that Newsweek used to work is that you'd have multiple people reporting on the same story from multiple bureaus, so I already had this natural sense of how journalism could be a collaborative process.

Then I was doing a masters in online communities, and from my thesis it was very clear that there was a need for this collaborative platform for journalists.

We've seen many times where journalists are reporting from a scenario or a rally and their cameras get taken. But imagine if that video could be automatically streamed to Stroome where editors around the world could be cutting it any way they want to, telling the stories any way they want and spitting it out across the web. So we made the Alpha version of Stroome, got it alpha tested, raised a little money and started work on the beta version. We launched it in April.

What makes Stroome different from other online editing suites?

The biggest difference is that there's an ability for you and me to form a group and I can remix you and you can remix me. I can share it just with Stroome, or just my friends; I can make private groups, or I can push it across the web. That's the biggest difference from other sites; we're really sharing the video, the openness of the files is really distinct.

How does Stroome fit in with what's going on with the media as a whole?

I'm trying to get people to do and think about how it's so clearly a place of energy and openness and jobs and there's just so much movement. I know a lot of people have lost their jobs. It's really difficult for a lot of people, but we absolutely are at a critical point where we need a lot of innovations and are open to a lot of innovations. My drive is to innovate and innovate in journalism. But I don't go to the journalism conferences, I go to the tech conferences. The tech conferences are just alive whereas the journalism conferences are just weeping. You just want to bring them together and say, 'Guys, this is exciting! It's not your death knell, this is a wonderful opportunity.' Stroome is a lot easier than all that. People understand video, they understand audio and they understand cutting it all together.

What's your financial model?

We have a few ideas, number one being storage. You can only allow people to upload so much until you just can't bear it anymore. At some point we'll put in some advertising. We've talked about charging something really nominal, like 99 cents (66p), after users create a certain number of groups, so that you can keep making as many groups as you want. Financials are one of the things we get to do this summer, really take a deep breath and figure out how we're going to implement the next iteration.

Xbox 360/PS3/Wii; 39.99; cert 3+; EA Sports

Famously, amid Tiger Woods' recent woes, his brand-partners abandoned him in droves but at least EA Sports stuck by him. And the latest version of the golf game that bears his name should provide him with some consolation, as it's very good. Although one aspect which, on the face of it, might add to his creeping paranoia strikes you when you see the packaging: for the first time, Tiger is joined on the cover by another pro golfer, Northern Irish hot-shot Rory McIlroy.

McIlroy's presence shouldn't be seen as evidence that EA Sports is hedging its bets on Brand Woods, though. Rather, it reflects the fact that Tiger Woods PGA Tour 11 contains a virtual facsimile of the Ryder Cup which will run this October at Celtic Manor in Wales, so a European poster-boy is required along with an American. The game's inclusion of the Ryder Cup should provide fans of the franchise with all the motivation they need to buy the latest iteration, and it is implemented in a commendably flexible manner: you can pretend to be Colin Montgomerie and pick a squad, then jump into whatever ongoing match takes your fancy after each hole. If you opt for the defaults (but choose the European team), you will be paired with McIlroy against Woods and Jim Furyk, at least in the initial stages of the tournament a daunting proposition.

However tempting, it's best not to jump straight into a Ryder Cup, as Tiger Woods PGA Tour 11 has a new RPG-style Experience Points (XP) mechanism. You earn XP for things like hitting fairways and greens in regulation, plus sinking birdies and eagles. But great chunks of XP can be liberated by taking on Skills Challenges, fronted by various pros, in which, for example, you might have to match noted short-iron specialist Boo Weekley around the greens. You can then cash in your XP on a bewildering array of attributes (or virtual items in the Pro Shop), and it makes sense to improve your golfing skills before taking on the hopes of a continent in the Ryder Cup.

You can also play an entire PGA Tour season, emphasising that this is a very meaty game. Along with the XP, there is another new gameplay mechanic called Shot Focus, which lets you improve length and accuracy by adding power-boost to your shots, imparting spin in mid-air or seeing a preview of your putt's likely course. But this is finite, so you must use it sparingly (although it recharges over the course of a few holes).

Tiger Woods PGA Tour 11 looks absolutely stunning: at last, there is a clearly visible demarcation between fairway and rough, and the cloud-studded skies and camera angles are great to behold. There are also plenty of engine tweaks that make the game more true-to-life: the wind can now swing around from shot to shot, for example, and your ball will no longer automatically be dead in the centre of your aiming circle, even if you catch it perfectly. Hitting from the rough is more unpredictable. Two teams of 12 people can contest a Ryder Cup online, and there's a slightly gimmicky mode called True Aim, which gives you a view close to what a real golfer would see and makes you think more about yardages. A very classy effort, which should bring a rare smile to Tiger Woods' lips.

Rating: 4/5

Spotify, Last.fm and We7 are old hat when it comes to innovation within the industry check these out

The music industry, as bemoaned ad nauseum, has been financially skewered by the digital revolution and consumers' new-found ability to share music freely. But green shoots are springing up everywhere and even Spotify, Last.fm and We7 are old hat when it comes to innovation within the industry. Here are five new digital music projects using crowd-sourcing, cool coding and collaboration to help the music industry rock out in the digital age:

No1: GigsWiz

GigsWiz is a site that generates analytics allowing bands to gather more accurate information about local fan demand for gigs. Based on a few questions, GigsWiz generates a piece of code that artists can embed on their websites, MySpace and Facebook pages. This piece of code then pumps out data about where visitors to their site come from. Bands can use this data to plan their next gigs. Based in Helsinki, Finland, GigsWiz was founded last summer by marketing professional Juuso Vermashein and entrepreneurs Joonas Pekkanen and Kai Lemmetty. It launched its invite-only beta site in May 2010 and is now open for all. GigsWiz aims to overcome the recorded music industry's financial challenges by allowing bands to maximise their revenues from live performances.

No2: MusicGPS

This iPhone app produced by musicDNA - not to be confused with MusicDNA, the possible successor to the MP3 which launched in January is focused on pairing music with maps. Users download the app to their iPhone and as they travel while listening to music, MusicGPS records which songs are listened to where. While the community is still small, at only just over 700 members, the potential applications for the sort of data collected are significant if it gained enough popularity. Similar to GigsWiz, MusicGPS collects local data about musical tastes, but is listener-driven rather than artist-driven. While it has huge potential for targeted advertising and local revenue generation, it is also a step in the development of the semantic web.

No3: Indaba Music

Ever wanted to start a garage band but without a garage and with band members stationed all over the world? Thought so. Indaba has created a very usable online music collaboration platform where multiple people can upload and remix with hundreds of other musically minded individuals. There are also community forums for everyone involved in music from engineers to producers to musicians. Wired used Indaba in May to take crowd-sourced music to the next level. 122 members remixed one single track, creating 85 new music files. Voting is underway to determine which of the top five of these tracks is king. At the end of the day, the project takes music production to the next level using crowd power and collaboration.

No4 fairsharemusic

Will people be more willing to pay for music online if they know it's going to a good cause? Maybe. Fairsharemusic's going to find out. Apple's iTunes store may have begun to get music consumers used to the idea of paying for their music online, but UK-based Fairshare adds a philanthropic element to this model. The site which launched Tuesday donates half the profit of every music file downloaded to one of 11 partner charities chosen by the listener. Fairshare takes the now ubiquitous idea of micro-payments, and turns them into "micro-donations".

No5: slicethepie

In digital years, slicethepie is actually pretty old at the ripe age of three, but it's got the right idea. Slicethepie, as we've talked about before, allows fans to fund the bands they like, cutting out the middle men between producers and consumers of music. Fans are also paid to review bands and scout out new talent. At slicethepie, anyone can invest in any band and every 1 chipped into the hat entitles the donator to a share in the band and subsequent royalties. Contracts can also be traded on the virtual exchange for the chance to profit from their good scouting abilities and get in on other bands from the ground up.

Video from BBC site sees internet traffic more than triple as almost 1 million people log on to watch from work

Was there a sporting fixture on yesterday? Why, yes, there was - but apart from the titanic struggle of John Isner and Nicolas Mahut (the longest-ever professional tennis match in the history of the solar system, which is 6bn years, so not bad) there also seems to have been some sort of football game going on in a distant land. It didn't last very long, but football doesn't compared to tennis.

But because the England v someone else match happened during office hours, many people were, well, in the office when it happened. Which meant that they had to take sneaky advantage of the streaming capabilities of modern networks to watch it.

Early figures from the BBC suggest the total number of 'concurrent streams' peaked at 800,000 although the total number of viewers will be many times higher. The BBC said this was a viewing record.

That, according to Demon Internet, which provided the graph above (click for a larger version), saw internet use increase by 55% solely during the game compared to an ordinary working Wednesday afternoon, compared with a 38% increase during the first World Cup game between Mexico and South Africa on 11 June.

But EasyNet Connect, a business ISP, says things got even heftier: it saw a 226% surge (that would be a more than threefold increase) in web traffic compared to the average day.

After kick-off, traffic more than doubled (up 114%) compared with the pre-match levels (from 0900 to 1400).

Chris Stening, the managing director of EasyNet Connect, said: "As the first England game to take place during work hours, this afternoon's match between England and Slovenia was the biggest test for businesses' internet connections so far. The data from our own network shows that streaming the game at work was a popular choice this afternoon, pushing many business connections to their limits."

Matt Cantwell, the head of Demon, states: "Customers see the internet as a utility and yet, their networks might not be able to cope with the demands like electricity can. The surge in internet traffic could cause problems for SME businesses, who are the lifeblood the UK's economy. If they can't run their business normally during a World Cup match and ban their workers from keeping an eye on games during working hours, then inevitably, the business will lose out both on productivity and customer satisfaction. Whatever happens, it's a lose-lose situation for those without the right network infrastructure and support."

And another business ISP, KC, says that the game triggered a 31% jump in web traffic, as users watched the game via the BBC's live online stream.

Not mentioned because it worked so well is the fact that the BBC's streaming has held up so well, while ITV's has been roundly criticised for failing to manage the load, notably during England's the tournament's first game, which also happened during office hours, but for which the demand was probably impossible to estimate. The BBC may have been better warned but even so, it can pat itself on the back for its success here.

The fallout from Google's collection of data from Wi-Fi networks while compiling its StreetView catalogue carries on

Google's gathering of data from open Wi-Fi access points in the UK as it collected its StreetView data now has a crime reference number: 2318672/10.

That doesn't mean it's definitely a crime, though; that's the investigation number issued on Tuesday by London's Metropolitan Police at the request of the pressure group Privacy International, which alleges that the search company carried out "criminal interception of wireless communications content" and that that constitutes an offence under the Regulation of Investigatory Powers Act and the Wireless Telegraphy Act.

Google has insisted all along that the collection of the data was an accident caused when code left in a production system kept the content being broadcast over the Wi-Fi networks as the Google StreetView car drove past.

It admitted to the collection in May.

Google was mapping the networks' location, names and MAC (Media Access Control) address, which is unique to each network and is broadcast by it and can be picked up by any passer-by equipped with a Wi-Fi receiver. It is not an offence to capture the latter details - but Google also captured content from messages being broadcast over the open networks, which French authorities say includes passwords from emails. Google did not try and would not have been able to access content on password-protected networks.

According to Privacy International, which has been briefed by police on the likely path the investigation will take, the next step will be initial inquiries into the essential facts of the case before deciding which (if any) law may have been breached. The police will need to seek advice on which legislation to focus on, as each involves a different prosecution process. The police estimate that this initial investigation will take eight to ten days, after which the case will be escalated to a specialist team working at the national level. No estimate has been given regarding the likely period of the main investigation.

Google has offered to delete the data relating to the UK. The UK's Information Commissioner acceded to the request, but Privacy International demanded that it be kept so that the police could carry out the investigation.

A number of different countries are investigating whether Google has broken any laws, because it used the same mapping/recording system when it carried out its StreetView sampling in other countries. The company has offered to delete the content data (though not the data about network locations)unread for every country, but only a handful, including Ireland, have agreed.

In some countries local laws have stymied further investigation. In Germany, its equivalent of the information commissioner, an arm of the government, has demanded to see the content - but there are strict rules against government agencies viewing private citizens' data without their permission.

In the UK, the police will need to interview Google staff to find out who the "responsible person" is for this matter.

Simon Davies, PI's Director said "We are pleased that the police have taken up this complaint for investigation. An evidence based approach to this complex matter is sorely needed now. We have already told police that we will cooperate fully with any inquiries. I know Google will want to do the same".

He added: "We hope that this difficult process will give Google pause for thought about how it conducts itself. Perhaps in future the company will rely less on PR spin and more on good governance and reliable product oversight".

In spite of all the answers the internet has given us, its full potential to transform our lives remains the great unknown. Here are the nine key steps to understanding the most powerful tool of our age and where it's taking us

A funny thing happened to us on the way to the future. The internet went from being something exotic to being boring utility, like mains electricity or running water and we never really noticed. So we wound up being totally dependent on a system about which we are terminally incurious. You think I exaggerate about the dependence? Well, just ask Estonia, one of the most internet-dependent countries on the planet, which in 2007 was more or less shut down for two weeks by a sustained attack on its network infrastructure. Or imagine what it would be like if, one day, you suddenly found yourself unable to book flights, transfer funds from your bank account, check bus timetables, send email, search Google, call your family using Skype, buy music from Apple or books from Amazon, buy or sell stuff on eBay, watch clips on YouTube or BBC programmes on the iPlayer or do the 1,001 other things that have become as natural as breathing.

The internet has quietly infiltrated our lives, and yet we seem to be remarkably unreflective about it. That's not because we're short of information about the network; on the contrary, we're awash with the stuff. It's just that we don't know what it all means. We're in the state once described by that great scholar of cyberspace, Manuel Castells, as "informed bewilderment".

Mainstream media don't exactly help here, because much if not most media coverage of the net is negative. It may be essential for our kids' education, they concede, but it's riddled with online predators, seeking children to "groom" for abuse. Google is supposedly "making us stupid" and shattering our concentration into the bargain. It's also allegedly leading to an epidemic of plagiarism. File sharing is destroying music, online news is killing newspapers, and Amazon is killing bookshops. The network is making a mockery of legal injunctions and the web is full of lies, distortions and half-truths. Social networking fuels the growth of vindictive "flash mobs" which ambush innocent columnists such as Jan Moir. And so on.

All of which might lead a detached observer to ask: if the internet is such a disaster, how come 27% of the world's population (or about 1.8 billion people) use it happily every day, while billions more are desperate to get access to it?

So how might we go about getting a more balanced view of the net ? What would you really need to know to understand the internet phenomenon? Having thought about it for a while, my conclusion is that all you need is a smallish number of big ideas, which, taken together, sharply reduce the bewilderment of which Castells writes so eloquently.

But how many ideas? In 1956, the psychologist George Miller published a famous paper in the journal Psychological Review. Its title was "The Magical Number Seven, Plus or Minus Two: Some Limits on our Capacity for Processing Information" and in it Miller set out to summarise some earlier experiments which attempted to measure the limits of people's short-term memory. In each case he reported that the effective "channel capacity" lay between five and nine choices. Miller did not draw any firm conclusions from this, however, and contented himself by merely conjecturing that "the recurring sevens might represent something deep and profound or be just coincidence". And that, he probably thought, was that.

But Miller had underestimated the appetite of popular culture for anything with the word "magical' in the title. Instead of being known as a mere aggregator of research results, Miller found himself identified as a kind of sage a discoverer of a profound truth about human nature. "My problem," he wrote, "is that I have been persecuted by an integer. For seven years this number has followed me around, has intruded in my most private data, and has assaulted me from the pages of our most public journals Either there really is something unusual about the number or else I am suffering from delusions of persecution."

But in fact, the basic idea that emerges from Miller's 1956 paper seems to have stood the test of time. The idea is that our short-term memory can only hold between five and nine "chunks" of information at any given moment (here a chunk is defined as a "meaningful unit"). So, when trying to decide how many big ideas about the internet would be meaningful for most readers, it seemed sensible to settle for a magical total of nine. So here they are.

1 TAKE THE LONG VIEW

The strange thing about living through a revolution is that it's very difficult to see what's going on. Imagine what it must have been like being a resident of St Petersburg in 1917, in the months before Lenin and the Bolsheviks finally seized power. It's clear that momentous events are afoot; there are all kinds of conflicting rumours and theories, but nobody knows how things will pan out. Only with the benefit of hindsight will we get a clear idea of what was going on. But the clarity that hindsight bestows is also misleading, because it understates how confusing things appeared to people at the time.

So it is with us now. We're living through a radical transformation of our communications environment. Since we don't have the benefit of hindsight, we don't really know where it's taking us. And one thing we've learned from the history of communications technology is that people tend to overestimate the short-term impact of new technologies and to underestimate their long-term implications.

We see this all around us at the moment, as would-be savants, commentators, writers, consultants and visionaries tout their personal interpretations of what the internet means for business, publishing, retailing, education, politics and the future of civilisation as we know it. Often, these interpretations are compressed into vivid slogans, memes or aphorisms: information "wants to be free"; the "long tail" is the future of retailing; "Facebook just seized control of the internet", and so on. These kinds of slogans are really just short-term extrapolations from yesterday's or today's experience. They tell us little about where the revolution we're currently living through is heading. The question is: can we do any better without falling into the trap of feigning omniscience?

Here's a radical idea: why not see if there's anything to be learned from history? Because mankind has lived through an earlier transformation in its communications environment, brought about by the invention of printing by movable type. This technology changed the world indeed, it shaped the cultural environment in which most of us grew up. And the great thing about it, from the point of view of this essay, is that we can view it with the benefit of hindsight. We know what happened.

A thought experiment

So let's conduct what the Germans call a Gedankenexperiment a thought experiment. Imagine that the net represents a similar kind of transformation in our communications environment to that wrought by printing. What would we learn from such an experiment?

The first printed bibles emerged in 1455 from the press created by Johannes Gutenberg in the German city of Mainz. Now, imagine that the year is 1472 ie 17 years after 1455. Imagine, further, that you're the medieval equivalent of a Mori pollster, standing on the bridge in Mainz with a clipboard in your hand and asking pedestrians a few questions. Here's question four: On a scale of one to five, where one indicates "Not at all likely" and five indicates "Very likely", how likely do you think it is that Herr Gutenberg's invention will:

(a) Undermine the authority of the Catholic church?

(b) Power the Reformation?

(c) Enable the rise of modern science?

(d) Create entirely new social classes and professions?

(e) Change our conceptions of "childhood" as a protected early period in a person's life?

On a scale of one to five! You have only to ask the questions to realise the fatuity of the idea. Printing did indeed have all of these effects, but there was no way that anyone in 1472, in Mainz (or anywhere else for that matter) could have known how profound its impact would be.

I'm writing this in 2010, which is 17 years since the web went mainstream. If I'm right about the net effecting a transformation in our communications environment comparable to that wrought by Gutenberg, then it's patently absurd for me (or anyone else) to pretend to know what its long-term impact will be. The honest answer is that we simply don't know.

The trouble is, though, that everybody affected by the net is demanding an answer right now. Print journalists and their employers want to know what's going to happen to their industry. Likewise the music business, publishers, television networks, radio stations, government departments, travel agents, universities, telcos, airlines, libraries and lots of others. The sad truth is that they will all have to learn to be patient. And, for some of them, by the time we know the answers to their questions, it will be too late.

2 THE WEB ISN'T THE NET

The most common and still surprisingly widespread misconception is that the internet and the web are the same thing. They're not. A good way to understand this is via a railway analogy. Think of the internet as the tracks and signalling, the infrastructure on which everything runs. In a railway network, different kinds of traffic run on the infrastructure high-speed express trains, slow stopping trains, commuter trains, freight trains and (sometimes) specialist maintenance and repair trains.

On the internet, web pages are only one of the many kinds of traffic that run on its virtual tracks. Other types of traffic include music files being exchanged via peer-to-peer networking, or from the iTunes store; movie files travelling via BitTorrent; software updates; email; instant messages; phone conversations via Skype and other VoIP (internet telephony) services; streaming video and audio; and other stuff too arcane to mention.

And (here's the important bit) there will undoubtedly be other kinds of traffic, stuff we can't possibly have dreamed of yet, running on the internet in 10 years' time.

So the thing to remember is this: the web is huge and very important, but it's just one of the many things that run on the internet. The net is much bigger and far more important than anything that travels on it.

Understand this simple distinction and you're halfway to wisdom.

3 DISRUPTION IS A FEATURE, NOT A BUG

One of the things that most baffles (and troubles) people about the net is its capacity for disruption. One moment you've got a stable, profitable business say, as the CEO of a music label; the next minute your industry is struggling for survival, and you're paying a king's ransom to intellectual property lawyers in a losing struggle to stem the tide. Or you're a newspaper group, wondering how a solid revenue stream from classified ads could suddenly have vaporised; or a university librarian wondering why students use only Google nowadays. How can this stuff happen? And how does it happen so fast?

The answer lies deep in the network's architecture. When it was being created in the 1970s, Vint Cerf and Robert Kahn, the lead designers, were faced with two difficult tasks: how to design a system that seamlessly links lots of other networks, and how to design a network that is future-proof. The answer they came up with was breathtakingly simple. It was based on two axioms. Firstly, there should be no central ownership or control no institution which would decide who could join or what the network could be used for. Secondly, the network should not be optimised for any particular application. This led to the idea of a "simple" network that did only one thing take in data packets at one end and do its best to deliver them to their destinations. The network would be neutral as to the content of those packets they could be fragments of email, porn videos, phone conversations, images The network didn't care, and would treat them all equally.

By implementing these twin protocols, Vint Cerf and Robert Kahn created what was essentially a global machine for springing surprises. The implication of their design was that if you had an idea that could be implemented using data packets, then the internet would do it for you, no questions asked. And you didn't have to ask anyone's permission.

The explosion of creativity in the form of disruptive applications that the world has seen since the network emerged in the 1980s may have taken a lot of institutions and industries by surprise, but it was predictable, given the architecture. There are a lot of smart programmers in the world, and the net provided them with a perfect launch pad for springing surprises. What kinds of surprises? Well, the web itself. It was largely the creation of a single individual Tim Berners-Lee, who in 1991 put the code on an internet server without having to ask anyone's permission.

Ten years after Berners-Lee started work, a disaffected, music-loving teenager named Shawn Fanning spent six months writing software for sharing music files and, in 1999, put his little surprise on an internet server. He called it Napster and it acquired over 60 million delighted users before the music industry managed to shut it down. But by that time the file-sharing genie was out of the bottle.

While all this was going on, plenty of equally smart programmers were incubating more sinister surprises, in the shape of a plague of spam, viruses, worms and other security "exploits" which they have been able to unleash over a network which doesn't care what's in your data packets. The potential dangers of this "malware" explosion are alarming. For example, mysterious groups have assembled "botnets" (made up of millions of covertly compromised, networked PCs) which could be used to launch massive, co-ordinated attacks that could conceivably bring down the network infrastructure of entire industries, or perhaps even countries. So far, with the exception of Estonia in 2007, we haven't seen such an attack, but the fear is that it will eventually come, and it will be the net's own version of 9/11.

The internet's disruptiveness is a consequence of its technical DNA. In programmers' parlance, it's a feature, not a bug ie an intentional facility, not a mistake. And it's difficult to see how we could disable the network's facility for generating unpleasant surprises without also disabling the other forms of creativity it engenders.

4 THINK ECOLOGY, NOT ECONOMICS

As an analytical framework, economics can come unstuck when dealing with the net. Because while economics is the study of the allocation of scarce resources, the online world is distinguished by abundance. Similarly, ecology (the study of natural systems) specialises in abundance, and it can be useful to look at what's happening in the media through the eyes of an ecologist.

Since the web went mainstream in 1993, our media "ecosystem", if you like, has become immeasurably more complex. The old, industrialised, mass-media ecosystem was characterised by declining rates of growth; relatively small numbers of powerful, profitable, slow-moving publishers and broadcasters; mass audiences consisting mainly of passive consumers of centrally produced content; relatively few communication channels, and a slow pace of change. The new ecosystem is expanding rapidly: it has millions of publishers; billions of active, web-savvy, highly informed readers, listeners and viewers; innumerable communication channels, and a dizzying rate of change.

To an ecologist, this looks like an ecosystem whose biodiversity has expanded radically. It's as if a world in which large organisms like dinosaurs (think Time Warner, Encyclopaedia Britannica) had trudged slowly across the landscape exchanging information in large, discrete units, but life was now morphing into an ecosystem in which billions of smaller species consume, transform, aggregate or break down and exchange information goods in much smaller units and in which new gigantic life-forms (think Google, Facebook) are emerging. In the natural world, increased biodiversity is closely correlated with higher whole-system productivity ie the rate at which energy and material inputs are translated into growth. Could it be that this is also happening in the information sphere? And if it is, who will benefit in the long term?

5 COMPLEXITY IS THE NEW REALITY

Even if you don't accept the ecological metaphor, there's no doubt that our emerging information environment is more complex in terms of numbers of participants, the density of interactions between them, and the pace of change than anything that has gone before. This complexity is not an aberration or something to be wished away: it's the new reality, and one that we have to address. This is a challenge, for several reasons. First, the behaviour of complex systems is often difficult to understand and even harder to predict. Second, and more importantly, our collective mindsets in industry and government are not well adapted for dealing with complexity. Traditionally, organisations have tried to deal with the problem by reducing complexity acquiring competitors, locking in customers, producing standardised products and services, etc. These strategies are unlikely to work in our emerging environment, where intelligence, agility, responsiveness and a willingness to experiment (and fail) provide better strategies for dealing with what the networked environment will throw at you.

6 THE NETWORK IS NOW THE COMPUTER

For baby-boomers, a computer was a standalone PC running Microsoft software. Eventually, these devices were networked, first locally (via office networks) and then globally (via the internet). But as broadband connections to the net became commonplace, something strange happened: if you had a fast enough connection to the network, you became less concerned about the precise location of either your stored data or the processor that was performing computational tasks for you. And these tasks became easier to do. First, the companies (Yahoo, Google, Microsoft) who provided search also began to offer "webmail" email provided via programs that ran not on your PC but on servers in the internet "cloud". Then Google offered word-processing, spreadsheets, slide-making and other "office"-type services over the network. And so on.

Here was a transition from a world in which the PC really was the computer, to one in which the network is effectively the computer. It has led to the emergence of "cloud computing" a technology in which we use simple devices (mobile phones, low-power laptops or tablets) to access computing services that are provided by powerful servers somewhere on the net. This switch to computing as a utility rather than a service that you provide with your own equipment has profound implications for privacy, security and economic development and public perceptions are lagging way behind the pace of development. What happens to your family's photo collection if it's held in the cloud and your password goes to the grave with you? And what about your documents and emails all likewise stored in the cloud on someone else's server? Or your "reputation" on eBay? Everywhere one looks, the transition to cloud computing has profound implications, because it makes us more and more dependent on the net. And yet we're sleepwalking into this brave new world.

7 THE WEB IS CHANGING

Once upon a time, the web was merely a publication medium, in which publishers (professional or amateur) uploaded passive web pages to servers. For many people in the media business, that's still their mental model of the web. But in fact, the web has gone through at least three phases of evolution from the original web 1.0, to the web 2.0 of "small pieces, loosely joined" (social networking, mashups, webmail, and so on) and is now heading towards some kind of web 3.0 a global platform based on Tim Berners-Lee's idea of the 'semantic web' in which web pages will contain enough metadata about their content to enable software to make informed judgements about their relevance and function. If we are to understand the web as it is, rather than as it once was, we need more realistic mental models of it. Above all, we need to remember that it's no longer just a publication medium.

8 HUXLEY AND ORWELL ARE THE BOOKENDS OF OUR FUTURE

Many years ago, the cultural critic Neil Postman, one of the 20th century's most perceptive critics of technology, predicted that the insights of two writers would, like a pair of bookends, bracket our future. Aldous Huxley believed that we would be destroyed by the things we love, while George Orwell thought we would be destroyed by the things we fear.

Postman was writing before the internet became such a force in our societies, but I believe he got it right. On the one (Huxleyan) hand, the net has been a profoundly liberating influence in our lives creating endless opportunities for information, entertainment, pleasure, delight, communication, and apparently effortless consumption, to the point where it has acquired quasi-addictive power, especially over younger generations. One can calibrate the extent of the impact by the growing levels of concern among teachers, governments and politicians. "Is Google making us stupid?" was the title of one of the most cited articles in Atlantic magazine in 2008. It was written by Nicholas Carr, a prominent blogger and author, and raised the question of whether permanent access to networked information (not just Google) is turning us into restless, shallow thinkers with shorter attention spans. (According to Nielsen, a market research firm, the average time spent viewing a web page is 56 seconds.) Other critics are worried that incessant internet use is actually rewiring our brains.

On the other (Orwellian) hand, the internet is the nearest thing to a perfect surveillance machine the world has ever seen. Everything you do on the net is logged every email you send, every website you visit, every file you download, every search you conduct is recorded and filed somewhere, either on the servers of your internet service provider or of the cloud services that you access. As a tool for a totalitarian government interested in the behaviour, social activities and thought-process of its subjects, the internet is just about perfect.

9 OUR INTELLECTUAL PROPERTY REGIME IS NO LONGER FIT FOR PURPOSE

In the analogue world, copying was difficult and degenerative (ie copies of copies became progressively worse than the original). In the digital world, copying is effortless and perfect. In fact, copying is to computers as breathing is to living organisms, inasmuch as all computational operations involve it. When you view a web page, for example, a copy of the page is loaded into the video memory of your computer (or phone, or iPad) before the device can display it on the screen. So you can't even look at something on the web without (unknowingly) making a copy of it.

Since our current intellectual property regime was conceived in an era when copying was difficult and imperfect, it's not surprising that it seems increasingly out of sync with the networked world. To make matters worse (or better, depending on your point of view), digital technology has provided internet users with software tools which make it trivially easy to copy, edit, remix and publish anything that is available in digital form which means nearly everything, nowadays. As a result, millions of people have become "publishers" in the sense that their creations are globally published on platforms such as Blogger, Flickr and YouTube. So everywhere one looks, one finds things that infringe copyright in one way or another.

This is a disagreeable but inescapable fact as inescapable in its way as the fact that young adults tend to drink too much alcohol. The only way to stop copying is to shut down the net. There's nothing wrong with intellectual property (or alcohol), per se, but our copyright laws are now so laughably out of touch with reality that they are falling into disrepute. They urgently need reforming to make them relevant to digital circumstances. The problem is that none of our legislators seems to understand this, so it won't happen any time soon.

Postscript

It would be ridiculous to pretend that these nine ideas encapsulate everything that there is to be known about the net. But they do provide a framework for seeing the phenomenon "in the round", as it were, and might even serve as an antidote to the fevered extrapolation that often passes for commentary on developments in cyberspace. The sad fact is that if there is a "truth" about the internet, it's rather prosaic: to almost every big question about the network's long-term implications the only rational answer is the one famously given by Mao Zedong's foreign minister, Zhou Enlai, when asked about the significance of the French Revolution: "It's too early to say." It is.

John Naughton is professor of the public understanding of technology at the Open University. He is currently working on a book about the internet phenomenon.

This week, Guardian games contributor Keith Stuart joins Aleks Krotoski and Charles Arthur to dissect the big announcements from the Electronic Entertainment Expo (E3) the biggest computer games event in the English-speaking world. Keith weighs in on the Nintendo 3DS, Microsoft's Kinect and how the indies fare in a console world.

Also in this week's programme, Charles breaks down what the sale of social networking site Bebo for a huge loss to owners AOL means for the networking scene, and gives the heads up on a new scam directed at British computer users that could cost victims up to 200.

Google, Yahoo and Amazon among sites to be monitored for content deemed offensive to Muslims

Pakistan will start monitoring seven major websites, including Google, Yahoo and Amazon, for sacrilegious content, while blocking 17 lesser-known sites that it deems offensive to Muslims, an official said today.

The moves follow a temporary ban imposed on Facebook in May that drew both praise and condemnation in a country that has long struggled to decide how strict a version of Islam it should follow.

Both the Facebook ban and the move announced today were in response to court orders.

The sites to be monitored include MSN, Hotmail, YouTube and Bing, said Khurram Mehran, a spokesman for the Pakistan Telecommunication Authority.

"If any particular link with offensive content appears on these websites, the [link] shall be blocked immediately without disturbing the main website," Mehran said.

Mehran said that, under instructions from the ministry of information technology, the authority had begun the process of barring and monitoring the sites.

Facebook was not part of the latest petition, which was ruled upon by the judge in the city of Bahawalpur, Mehran said.

A top court ordered the ban on Facebook for about two weeks in May amid anger over a page that encouraged users to post images of the prophet Muhammad. Many Muslims regard depictions of the prophet, even favourable ones, as blasphemous. YouTube was also briefly blocked at the time.

The Facebook ban was lifted after the social-networking site blocked that particular page in Pakistan, but officials said the government would keep blocking other unspecified sites that contained "sacrilegious material".

Icann decision marks end of 10-year battle, but pornography companies fear US politicians will shunt them into web ghetto

The internet could soon have its own red light district after the ".xxx" suffix was approved though pornography companies are not keen to use it.

Icann, the organisation which determines what "top-level domains" (TLDs) such as .com or .uk can be added to the internet announced today that it will begin the process of registering .xxx by making checks on ICM Registry, the company that wants to run the domain and sell registrations.

It marks the closing stages of a 10-year battle by ICM Registry, now run by the British internet entrepreneur Stuart Lawley, to get the .xxx domain set up so that legal pornography sites can be found in a single grouping.

Yet pornography is already plentiful online. One of the most valuable domains in the early days was sex.com, which was the object of a bitter battle in which rivals battled it out to own what was seen as a honeypot for surfers. In 2007 porn.com was sold for $12m.

But many pornography companies are unhappy with the idea of a dedicated space online because they expect that as soon as .xxx is implemented, conservative members of the US Congress will lobby to make any sex-related website re-register there and remove itself from other domains such as .com or .org.

That would mean that sex sites could be more easily filtered out from web searches, and lower their revenues. Free speech advocates also worry that sites about topics seen by US conservatives as controversial, such as homosexuality, might also be forced to use the .xxx suffix.

Icann acknowledged it had made mistakes in reversing its decision to accept ICM Registry's proposal three years ago under pressure from the Bush administration. Icann also said the proposal had been rejected because it lacked the backing of the pornography industry.

Lawley, who insists that child pornography will be banned in the domain space, thought the new address could easily attract at least 500,000 sites making it after ".mobi" the second biggest top-level domain name with a specific sponsor registrar.

The .mobi TLD, set up in 2005, was sponsored by a range of companies, including Google and Nokia, to create sites for browsing with mobile phones.

But where the .mobi TLD had commercial sponsors, the .xxx domain is notable for only having ICM Registry, which stands to benefit from every domain name it sells. Lawley says he expects to make $30m ( 20m) a year in revenue by selling each .xxx site for $60, and pledges to donate $10 from each sale to child protection initiatives.

AOL confirms sale to new owners Criterion Capital Partners, which describes business as 'attractive media platform'

AOL has confirmed the sale of Bebo to new owners Criterion Capital Partners, which argues that the young user base and revenue history continue to make the business an "attractive media platform".

Details of the deal were not disclosed it has been rumoured that Bebo may have been sold for $10m or less although AOL admitted that "the transaction will create a meaningful tax deduction". AOL needed to structure the deal to avoid being hit by massive corporate tax charges after paying $850m for Bebo just over two years ago.

Adam Levin, the managing partner at CCP who led the deal, said that Bebo remained attractive as both a "standalone entity and in the context of our broader investment objectives".

"The young, highly active user base, revenue history, presence in countries throughout the world and solid technical infrastructure make it an attractive media platform both as a standalone entity and in the context of our broader investment objectives," he said.

Tim Armstrong, chairman and chief executive of AOL, said that the deal meant that Bebo users would be able to "remain within the social platform that they know and love".

"Criterion Capital Partners are specialists in facilitating growth plans and turnarounds, and are well placed to drive Bebo's effort to strengthen its foothold within the highly competitive social networking arena," said Armstrong.

To contact the MediaGuardian news desk email editor@mediaguardian.co.uk or phone 020 3353 3857. For all other inquiries please call the main Guardian switchboard on 020 3353 2000.

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Brimming with technology, the latest super clever Mercedes-Benz S-Class demands your attention

Price 58,000
MPG 37.2
Top speed 155mph

It's dark. It's late. You are feeling sleeeeepy. Your head feels heavy. Your eyes are beginning to clo Wake up for goodness sake! You are supposed to be driving, not nodding off. Turn up the music, open the windows, pinch yourself. That's better. But before long, the motorway's blinking Catseyes will be hypnotising you again, and the whole awful head-jerking battle to stay awake on the road will start once more.

Tiredness Kills, yet we have all been guilty of pressing on into the night and a perilous future. Well, if you are at the wheel of the new Mercedes-Benz S-Class, you won't be doing it again. The winner, for the fourth year running, of What Car?'s prestigious "Luxury Car of the Year" award is also contender for the safest, smartest and most wide-awake car on the road.

It is 60 years since the Mercedes-Benz 220 the originator of today's S-Class appeared on our streets. Since then, each generation of the German flagship car has raised the bar in terms of safety, luxury, performance and technological ability. In its class, the S-Class is simply unbeatable. It is scholarship material; the victor ludorum; an unbearable swot. It has sold more than 3.3m models around the globe and is easily the top-selling luxury saloon in the world. Fortunately, we drivers don't have to compete against it (it would win every time) because it is on our side. All we have to do is sign that cheque and the S-Class will lay down its life for you.

Over the years the car has pioneered everything from anti-lock brakes to airbags, catalytic converters to electronic stability programmes. The latest feather in its cap has the rather dull name of Attention Assist. But this programme could do more for road safety than any development since the seatbelt. Almost 25% of serious road accidents are caused by drowsiness making sleeping at the wheel an even bigger threat than drink driving.

So how does Attention Assist work? In essence, it's like inviting Big Brother to belt himself into the passenger seat so he can keep an eye on your every move and then advise you in firm tones what to do next.

During the first few minutes of every journey you make, the car's computer generates a profile of your driving behaviour. For the rest of that journey it then compares this representation continuously with data it collects from 70 monitors around the car paid-up sneaks, if you like. These track your speed, acceleration, erratic steering (just before a driver drifts off, he or she will correct numerous tiny steering errors), and indicator and pedal use. The monitors note journey length, time of day and the music you are listening to flick from Radio 4 to Kerrang! and alarm bells will ring (not quite, but it gives you an idea of the forensic detail the computer is assimilating). Also taken into account are the day's driving conditions including wind direction, road surface and whether it is raining, snowing, hailing or not.

The key for Attention Assist is to detect the crucial moment what Mercedes rather poetically calls "the floating transition" when you slip from alertness to drowsiness. And when you do, Big Brother wakes you up with an unpleasant high-pitched warning sound which jerks you into consciousness. The digital dashboard then goes blank and in large capital letters the unequivocal message "ATTENTION ASSIST. Break!" flashes on and off until you pull over and fill yourself with espresso And, you're back in the room!

Clunk click: crash-test dummies

It is 60 years since "Sierra Sam", the world's first crash-test dummy, was strapped into an ejector seat on a 600mph rocket-propelled sled and fired into the desert to test the efficacy of a pilot-restraint harness. Things have moved on since Sam's day, and nowhere more so than Volvo's state-of-the-art crash laboratory in Torslanda, Sweden. This month the centre celebrates its 10th birthday and the 100 dummies who live and work there are in a party mood. But the big question is: who will have the honour of driving the 3,000th test car at 75mph into the centre's own 850-tonne concrete block?

Dream ride: Bennetts biker competition

Have you ever had the urge to ride up Route 66, own a Harley Davidson, or simply be decked out in the very best biking leathers? Bennetts, the UK's No 1 for bike insurance, is offering bikers across the country the chance to have their dreams fulfilled. Bennetts Biker Dreams will award 80,000 worth of prizes to the most deserving applicants in celebration of its 80th birthday. Entries to the campaign will be accepted until 30 September 2010. To enter and for full details visit bennetts.co.uk/dreams.

Email Martin at martin.love@observer.co.uk or visit guardian.co.uk/profile/martinlove for all his reviews in one place

Australia's biggest telecoms firm agrees to convert old copper-wire network to superfast optic fibre and lease it to the state's broadband company

The Australian government and the country's biggest telecoms company yesterday agreed a US$37bn ( 25bn) deal to build a national superfast broadband network.

Under the deal, Telstra agreed to convert its old copper-wire network into a superfast web of optic-fibre and then rent it out to the government's National Broadband Network company (NBN) in return for A$11bn ( 6.5bn) in long-term payments.

Australia has slower and more expensive internet services than many rich nations a problem viewed as a serious economic bottleneck. But Telstra a former state-owned monopoly like BT had been reluctant to become involved with such a costly, political and state-planned project.

Last year, that changed when the government threatened to split up Telstra and force it to sell one of its crown jewels, a stake in Foxtel, a pay-TV firm, unless it co-operated. Since then, Telstra shares have underperformed.

In the UK, the coalition government has asked BT to share its infrastructure in a similar fashion to boost speeds in regions, but has stopped short of offering public funding. A planned telephone bill levy of 6 a year to pay for superfast broadband has been scrapped.

Announcing the deal with Telstra yesterday, the Australian communications minister, Stephen Conroy, said: "The war is over."

The details of the non-binding deal have yet to be finalised, but it envisages NBN effectively leasing Telstra's fixed-line network. Telstra will not take equity in the broadband network, which still faces an uncertain future, given the conservative opposition has promised to scrap it if they defeat the Labor prime minister, Kevin Rudd, at general elections expected to be held in October.

Rudd hopes the Telstra deal will remove the last major roadblock for the broadband network, which he promised on assuming power in 2007.

The agreement at least eliminates uncertainty over Telstra's share price. By signing up to the government's plan, Telstra can now keep its stake in Foxtel.

"This agreement reflects a commitment by all parties to reaching a mutually beneficial outcome for Telstra investors, customers, employees and the industry," the Telstra Chairman, Catherine Livingstone, said in a statement.

The Telstra agreement must still be vetted by the competition regulator, which will want to be sure that the government-controlled NBN is a neutral body that allows private operators to compete fairly over the new network.Under the overall network plan, the government plans to invest A$26bn over seven years to develop the network and then look to fully privatise it five years after it is launched.

Once crucial details of the deal are hammered out, shareholder approval will also be needed. "Should those [detailed] agreements be finalised, Telstra expects they would be put to shareholders in the first half of calendar 2011," the company said.

Despite the best efforts of the House of Commons, we've managed to extract every MP expenses claim as a spreadsheet. See how the numbers add up
Get the data
MP travel claims, Oct-Dec 2009

Yesterday the House of Commons published the latest set of MPs' expenses. As I wrote then, they were published in a new searchable database, which actually makes the data harder to compile and extract. (Compare this to Simon Willison's work on MPs' expenses crowdsourcing).

Well, thanks to the work of Guardian developers Daniel Vydra and Roberto Tyley, we've managed to scrape the entire lot out of the Commons website for you as a downloadable spreadsheet. You cannot get this anywhere else.

Previously, we could give you totals claimed by MP: here's last year's. Because this is not a year's complete data, the Commons authorities are not keen on giving out totals - here's what they told me yesterday:

Please note that overall totals for each individual MP's overall expenditure are not published at this time of year. This is because MPs do not all submit claims on the same timescale: for example some submit claims at the end of the month and others do so less frequently, or even at the end of the year. Thus comparisons between individual total expenditure would be misleading.

It's a pretty reasonable reason, but that doesn't stop us working out totals from the data - with the enormous caveats above.

Here's how the totals look for just those two quarters, thanks to the genius of Many Eyes (I know we've been using Many Eyes a lot recently, but if you want to produce a quick visualisation, then it really can't be beaten at the moment).

The spreadsheet is just the raw numbers - with details of each claim for each MP. To get the exact details, you need to see the claim form on the commons site.

This is just a start - what can you do with the data?

Download the data

DATA: download the full datasheet

World government data

Search the world's government data with our gateway

Can you do something with this data?

Flickr Please post your visualisations and mash-ups on our Flickr group or mail us at datastore@guardian.co.uk

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Sending mobile data over your broadband with paid-for femtocell will count against monthly tariff

Vodafone has a nasty shock in store for would-be users of its "femtocell", which boosts patchy mobile signals indoors by sending the voice and data signal over the customer's home broadband. Any mobile data sent over the home broadband connection will still be charged against customers' monthly usage, the company has told the Guardian.

Outlining plans for future deployment, Vodafone senior marketing manager Lee McDougall said Vodafone is confident that consumer uptake of femtocells will be high. However he declined to give figures for sales since the launch in July 2009, or to say what increase in mobile use had been seen by femtocell users.

Femtocells whose name comes from the prefix "femto", meaning one millionth of a billionth are designed to improve mobile network coverage by plugging into a home broadband network and providing a 3G connection to attached phones.

Vodafone remains the only UK mobile operator in the UK to offer femtocells, through two different price plans. The current range dubbed Sure Signal boxes are retailing at 50 for existing customers on contracts over 25 per month, or 120 5 per month for two years for those on smaller contracts or pay-as-you-go contracts.

But though femtocells effectively relieve load on the mobile network, and send them via the broadband paid for by the customer, any minutes used calling via the femtocell will be taken from a customers monthly allowance, despite having already paid for the bandwidth in the original package. And mobile data sent via Sure Signal and through the customer's broadband will count against the data tariff for the contract as though the customer were outside using a mobile mast.

In Japan, mobile corporation SoftBank offers free femtocell packages to existing customers. Asked why Vodafone would not be following its lead, McDougall said: "Different markets have different drivers. We know we've got a competitive product."

At a time when data traffic is doubling every four months, according to O2, femtocells are an inexpensive solution to rapidly growing demand. Data transfers over femtocell are also far less expensive to the network operator than other means, as Dave Nowicki of mobile technology firm Airvana confirmed. "The marginal cost of delivery per gigabyte is much lower," he said. "Femtocells are complementary to Wi-Fi."

The Advertising Standards Authority last week upheld four complaints from rival mobile operators who said that advertising for the product was "misleading".

Vodafone's poster campaign pictured a man leaning out of his apartment window, apparently struggling to get a mobile signal, headed: "Only Vodafone can guarantee mobile signal in your home."

The most pointed complaint came from rival mobile operator O2 which said Vodafone did not make clear users would have to pay additional costs for a femtocell device. On this, the ASA said it was reasonable for people to infer that a guaranteed signal was part of the original mobile package but because this was not the case, the advertisement was likely to mislead.

McDougall told the Guardian the campaign would be modified to take into account the ASA ruling, maintaining that Vodafone Sure Start boxes would not be a hard sell to would-be customers.

"Customers have told us the product is lifechanging for them," McDougall told the Guardian. "They said it had made a significant difference to their life. The more they hear about them the more they're interested."

Although he said he couldn't put a figure on it, internal reports showed a higher-than-predicted uplift in data usage for customers trialling the Sure Signal boxes.

"Feedback from an 8m-leaflet door drop indicated that 90% of potential customers were willing to pay up front; unsurprisingly the desire to boost mobile signal was the biggest driver," he said.

In the US, AT&T is taking the same approach to mobile data sent through femtocells as Vodafone, and counting it against the customer's bill. AT&T argues that it is costly to install the systems at ISPs which will collect the voice and mobile data being sent by broadband and route it through its own network.

Actor Naoko Mori loves all things Apple except for the iPhone

What's your favourite piece of technology, and how has it improved your life?
There's a lot. I'm Japanese, I'm a gadget freak I like anything with buttons. I want to say my computer, but if I had to choose one, I'd say my mobile phone. This is almost sacrilegious, because I'm a complete Macophile, but I actually still have a BlackBerry I just prefer the buttons. I'm still on the fence with the iPhone because of the buttons and the texting.

When was the last time you used it, and what for?
Eight minutes ago, checking emails.

What additional features would you add if you could?
I travel so much I'm in the US a lot, and in Japan that I currently have three phones. So what I would really like to see is a phone that holds three Sim cards, so you have different numbers in different territories. So what it can do is choose the best network, depending on what country you're in.

Do you think it will be obsolete in 10 years' time?
I don't think so, I hope not. I think it will just be newer and better.

What always frustrates you about technology in general?
When it breaks down, or runs out of juice. It's just that dread that it can go wrong, and it often does.

Is there any particular piece of technology that you have owned and hated?
I've had a rotten time with shredders.

If you had one tip about getting the best out of new technology, what would it be?
I believe you should always buy the best that you can afford at the time. Also, be clear about what you need, and read the instructions. I know everyone hates to do it, but I think that to get the best out of whatever you buy, you have to. It's a bit boring, but it's worth it.

Do you consider yourself to be a luddite or a nerd?
Both. I'm Japanese, so it's in our blood to be geeks. But for certain things I'm old-skool I love technology, and I love what it does, but I think it should enhance and not take over your life. Emails are great, texting is great, but for the right purposes. Also, I miss peoples' handwriting we never write letters any more.

What's the most expensive piece of technology you've ever owned?
I guess it would be my laptop, my Macbook Pro.

Mac or PC, and why?
Definitely Mac. Everything about it, it just feels right. For me it's like the difference between coffee and tea I'm a coffee person. But I'm not sure about the iPhone yet.

Do you still buy physical media such as CDs and DVDs, or do you download? What was your last purchase?
CDs not so much, but DVDs definitely. I recently re-bought The King of Comedy, because I lost my old one I love that film. I like having the physical thing not just DVDs, but even books. I like the smell and the feel of the paper. I'd much rather read a newspaper something like a Kindle wouldn't be a big pull for me.

Robot butlers a good idea or not?
I don't need a butler what I do want a robot. But I don't want one of those human-looking robots, I want like an old-skool one with the square head almost like a companion, or a pet.

What piece of technology would you most like to own?
If it was something not real, I would like a time machine/transporter. With the amount of travelling I do, that would be a lot quicker and greener. In real terms, a helicopter or a massage chair.

Naoko Mori stars as Yoko Ono in Lennon Naked, screening on Wednesday 23 June at 9.30pm, on BBC4

Four idealistic students at New York University have raised $200,000 to fund a project building a more privacy-centric social network.

Diaspora isn't likely to take Facebook down just yet, but after a very flattering introduction in the New York Times a few weeks back the group watched hundreds of small donations flood in - more than 6,400 donations have been pledged so far - and in less than one month. Zuckerberg himself is rumoured to have contributed.

The four wrote on Monday that they had expected to scrape an initial $10,000 together through Kickstarter, the creative project funding site, from friends and family - but recognise they have "struck a chord with the world and identified a problem which needs to be solved".

That 'problem' is the need for what they describe as a "privacy-aware, personally controlled, do-it-all, open source social network".

"You may not hear too much from us in the coming months and we will try our best to provide regular updates, but our silence means we are hard at work," wrote the team: Daniel Grippi, Maxwell Salzberg, Raphael Sofaer and Ilya Zhitromirskiy.

Meanwhile, Zuckerberg was given a grilling by Kara Swisher and Walt Mossberg at the D8 conference yesterday; what MarketWatch described as his "Nixon moment".

"Zuckerberg, literally squirmed in his seat, took off his famous hoodie sweatshirt and had a Richard Nixon-like moment under the grilling... Sweat literally dripped from his face as he mostly dodged giving specific answers about the backlash stemming from the popular social network's recent privacy changes that caused ire among users. Zuckerberg also mostly dodged specific answers about how the backlash stemming from another recent privacy uproar affected him personally."

Watch Zuckerberg answering key questions on privacy; as John Paczkowski says in the introduction "if you're looking to straightforward answers to those questions, you're going to be disappointed".

A single weekend plus Transport for London's API was enough to produce a live, self-updating map of where Underground trains are. What else is possible? (Updated)

If you haven't already spotted it from yesterday's Newsbucket, you can now see a fascinating animated Google Map (requires Javascript) showing where London Underground trains are - live. Built by Matthew Somerville of MySociety at Science Hack Day over the weekend, it uses the new Transport for London API (via the London Datastore) - combining the train predictions service plus "a bit of maths and magic.. As Somerville says on the page, "It's surprisingly okay given this was done in only a few hours at Science Hackday and the many naming/location issues encountered, some unresolved. A small number of stations are misplaced or missing; occasional trains behave oddly due to duplicate IDs; some H&C stations are missing in the TfL feed..."

Given that the API has only been available for just over a week, you've got to applaud Somerville and his (very) small array of helpers. It is fascinating (not least for the occasional "ghost train" which whizzes across the map at supersonic speeds, reckoned to be a software reset). Since its launch on Sunday, it's also got colour-coded lines and Underground symbols.

Somerville has also built a similar live-updating map for network trains from all the major termini (it defaults to Birmingham New Street, but there's a menu offering all the choices). Again, splendid stuff, using data pulled - scraped, actually - from the National Rail website. (National Rail doesn't offer an API.)

Then again, if you were going to be difficult, you might ask: why is it that we've had live feeds for aircraft positions all over Europe (created in November 2009, but launched in Sweden in 2007) for longer than we've had live feeds of the Underground? (The simple answer: aircraft have transponders which detail their location to the world. Then again, buses now have GPS units which indicate their positions to bus stops.) One (outside) developer I've spoken to says that for years TfL has been "a black box that the Greater London Authority pours money into which generates outputs, but nobody can see inside".

It looks like that is changing, though, and one has to say that the efforts of Emer Coleman, head of London's Data Store have been instrumental in getting TfL to open up its data in this way.

For example, you can find out about traffic on your commute to work.

Or you can see the locations of traffic cameras on an OpenStreetMap

In fact they're so good that the page of inspirational uses of London Datastore data is already getting rather long.

She can also take pride that the Greater London Authority is one of only four local authorities across the whole of the UK which is judged "truly open" according to Openly Local (the others are Lichfield District Council, Salford City Council and Warwickshire County Council.

However, OpenlyLocal points to another 7 authorities which are "semi-open". So that's 11 which are open or semi-open - out of a total of 434 across the country.

That's an enormous amount of work to be done by those 423 authorities - which have only until January before they should have all sort of extra data made available for free.

Yet look at the possibilities: if opening up just the first tranche of TfL data can mean this, then there could be enormous potential for other local government data applications. What would you do if you could get your hands on that data?

If policy focuses only on R&D and patents it will privilege big business

Larry Elliott argues that Britain has wasted years "waiting for the invisible hand to deliver Britain magically into a new golden age of hi-tech firms and happy, well-paid workers" (Innovation will get the economy moving, 7 June). And he believes a more active innovation policy should address the current economic crisis. This argument is well-made but his analysis contains common misconceptions about innovation that may have unwanted, even regressive, consequences.

First, Elliott cites the conclusion of the recent report by the National Endowment for Science, Technology and the Arts (Nesta) on rebalancing the economy. Of the four scenarios considered, "the fastest growth of all (3.2% a year on average) is where innovation is boosted across all sectors of the economy, low-tech as well as hi-tech".

This conclusion resonates with much other work done by Nesta, and by my colleagues in the field of innovation studies, that has argued against the traditional exclusive focus of innovation policy on hi-tech and research and development (R&D) expenditure. Yet Elliott focuses exclusively on the OECD's data that compares "the impact spending on research and development has had on patents taken out in the three main patent offices of the world [which] tend to be the ones that have a high value".

Innovation is dependent on a much wider set of organisational and social capabilities that are overlooked by such measurements. The connection between investment in R&D and economic growth is thus much more complex and indirect. Accordingly, policy should not automatically privilege these R&D-intensive forms of innovation over low-tech or social forms that may be just as important, even economically.

Secondly, we have to consider the direction of innovation and who it benefits. And focusing on R&D and patents overwhelmingly benefits large corporations from developed countries with major research facilities and large intellectual property portfolios. It also shapes science since only those who can (truthfully or not) promise imminent commercial benefit get funding. The shameful evisceration of the internationally leading Horticultural Research Institute at Warwick University is a vivid illustration of this threat to national assets.

Finally, given that innovation must currently deal not just with the economic crisis but also with enormous global social and environmental challenges as recognised by the Green New Deal plan which Elliott co-authored these questions of direction are all the more essential. Transforming Britain into an equitable and low-carbon society will demand significantly higher levels of innovation, but in ways that include public engagement: we need a new model of democratic science and innovation.

Elliott's other work shows he is no patsy for big business and finance. But focusing on hi-tech innovation alone forestalls this crucial public discussion, to the exclusion of all other stakeholders.