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CNet News.com: "New research shows the growth rate of open-source browser Firefox is slowing, while Microsoft's browser market share continues to dip." See the data from WebSideStory on this page. Also see coverage by Silicon.com, vnunet.com, TechWeb News and PC Pro.

Microsoft's travelin' truck

Further proof that Microsoft is everywhere: On vacation last week, I stopped in Williams, Calif., and happened across one of the Microsoft Across America trucks. The driver said they were headed up to Redding, Calif., and then Medford, Ore. The crew was in a hurry, so I didn't get a chance to ask for a peek inside.

Another Napster ad flub?

Microsoft is betting on portable music subscription services, enabled by the latest version of its digital-rights management technology, as one way to differentiate its digital music efforts (and those of its partners) from Apple's dominant iTunes music software and iPod portable music player. Along those lines, the current advertising push for the new Napster to Go service, which uses the Microsoft technology, promises to generate more consumer awareness of the concept.

But even in the context of that campaign, Microsoft hasn't been able to escape the iPod's popularity. Here's an audio clip of a recent Napster to Go ad on the Howard Stern show, in which the radio host gives the rival Apple platform an inadvertent plug right in the middle of the paid Napster spot.

[MP3 | WMA]

It starts well enough, with some back-and-forth in which Robin Quivers explains the portable-subscription concept. But then Stern says, "See, that makes more sense to me than paying 99 cents a song, because you get tired of some songs. Like I remember when that song came out I was into with Pink ... 'Get the Party Started,' but I don't want that in my iPod now or my MP3 player."

Now, there are at least two ways to look at that off-the-cuff iPod comment. On the one hand, tech-savvy listeners familiar with the situation would already know that you can't use Napster to Go or other portable-subscription services with the iPod. For those people, or other people who figure it out based on other parts of the campaign, the iPod reference and the rest of Stern's extemporaneous Napster ad would tend to reinforce the notion that portable subscriptions are a possible reason to opt instead for one of the Windows Media-compatible devices that work with subscription services.

But many people who heard the ad probably weren't aware of that distinction. For those people, the seemingly reflexive iPod reference would only reinforce Apple's position as the de facto standard in digital music. It's the first platform that many people -- including a national radio personality and a celebrated comedian -- think about when they think about digital music.

Combining that with the last-place ranking of the Napster to Go Super Bowl ad, the broader campaign might not be shaping up as the best introduction for the new Microsoft portable-subscription technology.

Note to readers

I'm out of the office and won't be posting here again until next week. Have a good week, everybody.

Xbox power cord recall

Associated Press: "Microsoft Corp. said Thursday that it was recalling 14.1 million power cords globally for its Xbox game console because they can be a fire hazard." Here's the official company statement.

Clarke on Microsoft

Wednesday at the RSA Conference, I was able to grab a few moments with Richard Clarke, the former White House cybersecurity and counterterrorism adviser, as he left the Moscone Center after appearing on a panel. See this story from today's paper for his rather pointed comment on the notion of Microsoft offering its own anti-virus and anti-spyware software.

Here's what Clarke said on another topic -- his desire for Microsoft and other software companies to be held accountable to standards for secure software development:

"I think every software company should say what it does, specifically, to have quality assurance in software code writing and development. Ideally that would be generally accepted best practices derived from what Oracle does, what Apple does, what Microsoft does, so they can learn from each other's best practices and there will be a generally accepted set of best practices, and then we would know if people were living up to them or not. We could get a third-party auditor to come in and check whether or not they were living up to them. Until that happens, we really don't know whether it's all rhetoric or not."

During the earlier panel discussion, Clarke had explained that the concept would then let the marketplace judge the companies based on whether or not they adhered to those practices. For today's story, I asked Microsoft to respond to Clarke's comments on the subject. Here's the full statement from Amy Roberts, director of product management in the company's Security Business and Technology Unit:

"Many software companies including Microsoft are serious and committed to security and are making substantial investments in improving software on multiple fronts to protect customers from malicious attacks. At Microsoft, we feel that writing secure code is so important that we have formalized our security efforts by adopting a 'Security Development Lifecycle,' published our methodologies, including books on writing secure code and threat modeling, made our tools available to independent developers and offer formal training on security. Microsoft is active in organizations such as the Secure Software Forum, working with other industry leaders, to focus on application security as a life-cycle and industry-wide issue. The market is demanding security now and that hard work is going forward already."

More from Symantec CEO

Symantec Chief Executive John Thompson was blunt when discussing Microsoft during his keynote address at the RSA Conference yesterday morning, but that was just the start. Later in the day, during a Q&A session with reporters, he was asked repeatedly about Microsoft's move into the security-software market. A few excerpts from his responses:

On the news that Microsoft will come out with consumer anti-virus protection this year: "Actually it's now later than we thought, so it shows you how difficult this challenge is. So the fact that they're going to have something late in the year as opposed to midyear as we had originally forecasted suggests that this is not a problem that's easily solved."

On whether Microsoft's move played a role in Symantec's decision to acquire Veritas: "We had been on a path as a company to be a bigger player in the enterprise security space for a long time, in the enterprise software space for a long time. And so I could care less about what Microsoft does. I'm more focused on what our customers' needs are and how we can do a better job of serving them."

On whether Symantec would raise antitrust objections over Microsoft's decision to offer free anti-spyware protection to Windows users: "I'd rather fight Microsoft in the marketplace because we're convinced we can whup 'em. So this is not about showing up in Washington or whining on someone's doorstep about what Microsoft can or might do. To the extent that they violate the position of prominence that they have, be assured that we'll be watching, but whining in Washington about press releases or pointing to left field by Bill and his team, I mean, of what value is that?"

For more, you can access a webcast and transcript of the session from this page.

Davos Doodles resurface

Bill Gates reprised his spoof of the "Doodles Doodles" mix-up during his keynote address at RSA on Tuesday morning. (See this story for more background if you missed it the first time.)

This time I was quicker with my camera and captured an image, above. In addition to Gates' purported scribblings about Bill Clinton, Angelina Jolie and his desire for a cheeseburger, there was a new security-related twist for RSA: "Perhaps worst of all, I've got my new password up there," Gates said.

More on IE7 plans

Microsoft is revealing few details about its plans for additional features in the newly announced Internet Explorer 7. (See our story this morning for the news.) But this weblog post by Dean Hachamovitch, who runs the Internet Explorer team, offers more background on the company's decision to move up the schedule for the preliminary version of the new browser to this summer. Among other things, he also addresses but doesn't definitively answer the question of whether the browser will ultimately be available for Windows 2000 machines.

See coverage and commentary on the IE7 announcement from Microsoft Watch, Microsoft Monitor, Inside Microsoft and CNet News.com.

New IE, free anti-spyware

Two of the pieces of news emerging from Bill Gates' keynote address at the RSA Conference this morning:

• Microsoft plans to offer a new version of Internet Explorer, IE 7.0, on its own, with a widespread beta version coming this summer. The company had been planning to wait until the next version of Windows, due in 2006, to come out with the new Web browser.

• The company will make the finished version of its anti-spyware product available to Windows users at no charge. That could complicate matters for existing vendors of anti-spyware software.

During his keynote address later in the morning, Symantec CEO John Thompson addressed Microsoft's broader security initiatives:

"We applaud Microsoft's security initiatives. They are very necessary -- but in my opinion, not sufficient for large enterprises. They don't offer a cross-enterprise, heterogeneous solution and genetically they may be incapable of doing so." As a result, he said, Symantec and other companies specializing in security software "will always be a better alternative. We provide common tools across the many disparate environments present in every large enterprise, and we aren't distracted by computer games and a host of unrelated security stuff going on."

Gates webcast from RSA

The first big event this morning here at the RSA computer-security convention is a speech by Bill Gates. Microsoft is planning to webcast his address on-demand later this morning as an installment in its Security360 online series. Access the video here.

See our story this morning for more on the speculation leading up to Gates' speech, and how the company's move into the security software business could affect the existing players in the industry. See also the graphic, below, that accompanied the story. USA Today also explores the issue in this story.

RSA Conference on tap

I'm down in San Francisco this week for the RSA Conference, the big computer-security convention, where Bill Gates is scheduled to speak Tuesday morning. I'll be posting to this weblog and writing stories for the newspaper during the conference. In the meantime, here are some related stories and sites.

• San Jose Mercury News: Gates, CEOs to stress computer security at S.F. conference

• Dow Jones Newswires: Microsoft's Gates Could Steal The Internet Security Show

• San Francisco Chronicle: Surge in phishing e-mails to take spotlight at cryptography conference

• Microsoft Security Response Center's weblog, new for RSA.

• An IT Conversations interview from November with Microsoft's Kim Cameron about the company's evolving digital-identity strategy. (Identity promises to be one of the hotter topics at the conference this week.)

• eWeek: All Eyes Turn to Microsoft at RSA Security Powwow

• Mary Jo Foley, Microsoft Watch: Will Microsoft 'Mako' Take a Bite Out of Windows Security Problems? and, from the archives but still relevant, Microsoft Readies 'A1' Security Subscription Service

• IDG News Service: Record Attendance Expected at RSA Conference

Ballmer: Xbox 2 'amazing'

Microsoft CEO Steve Ballmer today became the latest Microsoft executive to say some vague but intriguing things about company's plans for the next-generation Xbox console. (See this earlier post and the second item in this article.) His comments came in response to questions from the audience during an event for minority high-school students this morning on the company's Redmond campus. Here's what he said in response to the first one:

"When you see the new Xbox, you're going to think it's un -- well, let me say it politely -- unbelievable. Just unbelievable. The graphics, what it can do, the way things look, huge innovation. Rumors are that we'll see that product sometime soon. I couldn't comment, of course, on those rumors. But it's an amazing, amazing innovation."

Later, one of the students asked if the company had a chance for holding up in the long run against the better-established Nintendo and Sony in the video game business. Here's what Ballmer said about that:

"I think we’re going to blow by Sony with our next box. I absolutely think we’re going to kick their backsides, so to speak. I think Xbox 1 has been a fantastic product. We’re not market leaders yet. There’s Sony, there’s us, there’s Nintendo. When we get Xbox 2 in the market, there’s going to be Xbox and the other guys." His voice escalated to a crescendo as the audience laughed and applauded. "I'm feeling a little frisky on this topic right now!" he added.

I went back and listened to my recording a few times, and Ballmer did, in fact, say "next box" at the beginning of that response. Was that merely his own verbal shorthand, or does it give away something about what the company will call the next console? Perhaps the former, since he went on to use the name "Xbox 2."

At any rate, the audience member then followed up with another question, asking what would make the next Xbox stand out over other game systems.

"Why do people buy one game console over another? As we say around here, 'Duh, it's the games.' ... Partly they're great games because they have great graphics, they have great processing, they have great this, they've got great that, but it's about getting great games. So, there's two parts to that: Number one, we have to make sure we have a great environment, software environment for people to write games, games that connect to one another, games that are social, games that are hard-core. We've got to make sure we let people write great games. But then, number two, we, Microsoft, have to write a number of really great games to show it off. What is 'Halo 2?' It's the greatest video game ever written. It shows off Xbox 1, and we’ve got some more games coming that will be the greatest video games ever written, and they’ll show off Xbox 2." He concluded, with a grin, "There’s probably a more humble way to say what I just said, but I’m all worked up."

'Pizza in Redmond'

Some of the MSN Search advertising banners and transit signs around the main Microsoft campus in Redmond are tailored to the area, including this one, above, that shows a search for "Pizza in Redmond."

After seeing that sign, I couldn't resist plugging that phrase into the MSN Search engine and a few other big search sites, just as an experiment to see how the results would compare. Looking at each of them, it's pretty easy to conclude that the other three provide more useful results than MSN Search does for someone looking for pizza in Redmond. Click through these links to see for yourself:

• Google
  
• Yahoo Search
  
• MSN Search
  
• Ask Jeeves

But then I looked more closely and realized that the advertising sign was promoting the "search near me" feature in MSN Search. So I readjusted my settings to put my location in Redmond, and did a simple search for "pizza" under that geographic constraint. The first non-sponsored result? Janitorial supplies.

Not wanting to rush to judgment, I also tried a search for the full phrase, Pizza in Redmond, under the Redmond geographic constraint, even though that would seem redundant. The first non-sponsored result was the resume of an aspiring computer programmer whose past experience included a stint as a delivery driver for Papa John's Pizza in Redmond. Just to be complete, I also tried the search under the Redmond geographic constraint with quotes around the phrase. Not much better.

Of course, the real kicker is to try the "pizza in redmond" search in Google's new Google Maps beta site, which is specifically tailored for geographic searches. Click here for the result.

Fiorina's HP departure

Here's a roundup of some of the initial coverage of Carly Fiorina's exit from Hewlett-Packard, which has sparked new speculation about H-P's future as an intact company. H-P is not only the second-biggest maker of Windows PCs, it's also the largest maker, by far, of Windows Media Center PCs, the model on which Microsoft is staking its future in the consumer PC market.

• Wall Street Journal Online
  
• San Francisco Chronicle
  
• Reuters
  
• New York Times
  
• Associated Press
  
• CNet News.com

Inside Microsoft's buy

Many of the companies Microsoft acquires are privately held, making it difficult to dig up detailed information about their finances and businesses. But Microsoft's planned acquisition of Sybari Software Inc., announced today, comes with the added bonus of Sybari having filed for an initial public offering.

As a result, many of the otherwise undisclosed details are available in its Form S-1 filing, including the fact that the company values itself at up to $186 million (calculated based on the high end of the offering price and the number of shares that would have been outstanding after the offering.) Microsoft declined to say how much it paid for the company.

MSN ad revenues

For today's Microsoft Notebook, the P-I's graphics department put together this graphic showing how the growth in advertising revenue has boosted MSN's overall business during the past three years.

WMLAH shuts down

Watching Microsoft Like a Hawk, which has been one of the best online, daily collections of Microsoft-related news, has shut down, according to a notice on the site today, which notes that the site's publisher, Bristow, Va.-based Lasater e-Properties, "is ceasing operations later this month." See this CRN story from late 2003 for more on the site's popularity. Traffic is now being redirected to Bink.nu.

Napster's Super Bowl ad

The Super Bowl ad for Napster's new Napster To Go service promised to boost consumer awareness of the concept of portable music subscription services, the initial versions of which are based on a capability in Microsoft's Janus, the latest version of the company's digital-rights management technology.

Well, a day later, more consumers are certainly aware of the concept, but not necessarily in a good way. The ad zoomed in and inexplicably lingered on Napster's cat mascot holding a complex sign comparing the portable subscription offer to the iTunes/iPod download model. As Charles Cooper of CNet News.com observed, "Most of America agreed that Napster's Super Bowl ad was a stinkeroo." He cited the results from the USA Today Ad Meter focus groups, which ranked the Napster ad dead last.

However, Forrester Research analyst Jim Nail, guest-posting on Charlene Li's weblog yesterday, called the ad simple, clear and compelling. He acknowledged that it wouldn't qualify for the Advertising Hall of Fame, but he predicted that "it will generate a lot of Napster 30-day trials" today.

'Reduced Media' review

Neowin has an inside look at the stripped-down version of Windows that Microsoft has been ordered to sell in Europe, complete with screen shots. As reflected in this setup-page screenshot, the reviewed by Neowin was one of the initial versions made by Microsoft when it was calling the product "Windows XP Reduced Media Edition," before the European Commission objected. No word yet on what the new name will be.

Gates at the Office

Bill Gates (eerily color-coordinated with the backdrop) addressed the assembled developers this morning on the final day of the company's first Microsoft Office System Developer Conference. (See our story earlier this week for more details.) Among other things, he talked briefly about the next version of Office, saying the company is making a "big move toward built-in workflow capabilities."

Gates also had a little fun recounting the incident at the World Economic Forum, where some journalists picked up some of his doodles, mistook them for Tony Blair's, and called in handwriting experts and psychologists who concluded, based on the scribbling, that the prime minister was "struggling to concentrate" and "not a natural leader."

Setting the record straight, tongue in cheek, Gates showed a parodied version of his doodles, with spoof scribbles such as, "So hungry -- need cheeseburger," "I miss Clippy," and "Why does Bill Clinton get to sit next to Angelina Jolie?"

See coverage of the speech by CNet News.com, and read the official Microsoft transcript here.

MSN Search ad critiques

In case you haven't seen them yet on TV, you can check out the first MSN Search ads here and here.

Adweek and Advertising Age have yet to weigh in, but in the meantime we have Nathan Weinberg and Joe Wilcox to consult on the subject. On the Inside Microsoft weblog, Weinberg says the overview ad is "just plain cool," while the basketball ad "might be trying a little too hard, but it sets up a theme." On the Microsoft Monitor weblog, Jupiter Research's Wilcox calls them "almost antithesis to Apple's iPod ads."

The would-be 'Apprentice'

Matt Hines of CNet News.com nicely sums up last night's Microsoft-related development on the the TV show, "The Apprentice": "Microsoft employee Verna Felton swapped Donald Trump's trademark words 'you're fired' for the far less dramatic 'I'm tired.' "

Yes, the Microsoft employee who had been competing to be Trump's "Apprentice" left the popular TV show voluntarily as of last night's episode, disappointing the Microsoft watchers who were following this season with some extra interest because of her involvement. "What do I write about?" asked InsideMicrosoft's Nathan Weinberg in his live episode recap, after Felton quit.

Explained Felton in her interview this morning with the "Today" show's Matt Lauer: "To me business is business and gaming is gaming. There was a lot of gaming going on and that's not quite my style. Between the backstabbing and bickering and fighting for camera time, it just wasn't something I was interested in. "

With that in mind, are there any insights to glean about the Microsoft culture from the nature of Felton's appearance on (and rapid disappearance from) the TV show? What does her decision to quit say about the ability of people from Microsoft to exist and survive in the outside world? As Brian Chin noted in his episode recap this morning: "Must be nice working someplace where they apparently don't have office politics."

Xbox Live's first baby

A couple who met on Microsoft's Xbox Live online gaming system, playing "Ghost Recon: Island Thunder," had their first child, Xbox Live's Major Nelson reports. Of course, they've already come up with a gamer tag for the little guy.

Stage time for Halo-Excel

Sam Radakovitz, the 27-year-old Microsoft employee who developed the Halo 2 RSS Excel Workbook on his own time, got a nice plug during the opening keynote address by Microsoft executive Richard McAniff at the Microsoft Office System Developer Conference in Redmond this morning. Microsoft product manager Joe Andreshak demonstrated Radakovitz's workbook on stage as an example of an innovative way to use XML data in Excel.

Microsoft's iPod users

Wired News reports that many Microsoft employees are choosing iPods over competing portable music players that use the Windows Media format. Drawing on an anonymous Microsoft manager as its source, the story reports that the trend concerns company executives to the point that employees are "hiding their iPods by swapping the telltale white headphones for a less conspicuous pair."

The idea that the iPod is popular among Microsoft employees isn't exactly new or earthshaking. But the Wired News story has caused a minor stir, complete with a Slashdot post. Excerpts from some of the commentary thus far:

• Ed Bott: "I have no doubt that lots of Microsoft employees own iPods. But taking an offhand remark from an unknown source (who may or may not have a hidden agenda and who may or may not know what he’s talking about) and extrapolating it to the entire campus is just silly."

• Doug Thews: "Do Microsoft employees own iPods?? My answer is, WHO CARES! ... It's this kind of tactic (both sides) that really irritate me about "technology camps". Why is it that when you work for one "camp", you MUST NOT OWN any other product that can be considered to infringe on any of their product lines?"

• Jupiter Research's Michael Gartenberg: "Geez, I doubt it's policy, but it's a little tacky to be walking around campus with an iPod, wouldn't you think? You don't have to be scolded about something to know it might not be a career enhancing move. Sort of like working at Coke and ordering a Pepsi for lunch ... "

• Jupiter Research's Joe Wilcox: "I assume iPod usage has got to frustrate, maybe even irk, some of the folks over at the Windows Digital Media division. But I see more of an opportunity than a problem. In fact, I would argue that Microsoft would make even better products if more employees used other vendors' goods. Microsoft developers and their hardware partners could learn lots from the iPodders and use that knowledge to improve PlaysForSure-logo products."

• Microsoft's Robert Scoble: "I think it's a positive thing to study your competitors and figure out what they've done well and look at what you aren't doing well and improve it. Does it do Microsoft any justice to stick our heads in the sand and pretend that Apple doesn't have a better product? No. The market has spoken. ... That all said, if there's a product that comes out that's arguably better than the iPod in end-to-end experience you'll be first to know it. Why? I'll be the first to jump up and down and say it."

• Engadget:"We can understand the people charged with killing the iPod feeling put out, but for as much smack as people talk on Microsoft, we have a hard time believing that the boys at the long rosewood table are troubling themselves over something as silly as this."

UPDATE: Considering the above in the context of the Bill Gates photo phenomenon that swept the Web a few weeks ago, this was probably inevitable. (Thanks, Brian, for pointing that out.)

MSN Search roundup

Microsoft distributed this publicity photo of Bill Gates and the MSN Search team in conjunction with last night's release of the new MSN Search engine. (Click image for a larger version.) As you can see, the Microsoft co-founder has added a few people to his photographic entourage over the past few decades. The company also published an open letter from Gates to mark the MSN Search launch.

Meanwhile, the company's multimillion-dollar MSN Search marketing blitz begins today, with 30-second television ads starting in prime time tonight. The campaign also includes movie-theater ads, online ads, billboards and other forms of advertising. The Wall Street Journal offered more details on the marketing effort in this story today, putting the overall value of the campaign in the tens of millions of dollars.

See our story from today's paper for more details on the launch and the competitive landscape Microsoft faces in the search business. The MSN Search weblog offers this entry about the release by MSN executive Christopher Payne. And here are excerpts from additional coverage and commentary in newspapers, weblogs and news sites:

• New York Times: "Analysts say that the quality of MSN's results is still lower than its rivals, Google and Yahoo. 'For now, Microsoft is still playing a game of catch-up versus leap forward,' said Niki Scevak, an analyst with Jupiter Research. He said that once Microsoft was able to make its search product roughly equivalent to those of its rivals, it could attract market share because of its ability to promote search on its many products."

• CNet News.com: "Now that Microsoft is launching its own technology, the software giant will be working hard to outpace rivals, using its Internet Explorer browser and its desktop dominance to make a lasting impression. 'They'll be trying to get people to say "I MSN Search'ed it",' said Danny Sullivan, an industry expert, referring to the commonly mentioned practice of 'Googling' something or someone.

• Associated Press: "[MSN executive Yusuf Mehdi] conceded that Microsoft still had work to do on a 'search near me' function that attempts to find things, such as a plumber or a Chinese restaurant, that are geographically close to the user. Mehdi said Microsoft still needs to complete deals with online yellow pages providers to make it more likely that the user will actually find the closest restaurant or plumber."

• John Battelle: "Like Yahoo before it, Microsoft can now embark on its own path, and I expect we'll see a lot of innovation coming out of Redmond. That's good for everyone. Welcome to the party (officially), MSFT! Now it gets interesting.... "

• Koolap weblog: "I’m surprised that they chose to have the url be search.msn.com instead of [something].com, just to help potential users remember the url."

• Dave Winer: "Hey you gotta love a search engine that thinks I'm the #1 Dave, and my RSS is the #1 RSS."

• Search Engine Watch: "The core search engine is good and a welcomed new 'search voice' in the space. However, it does not make a massive leap beyond what's offered by Google, Yahoo or Ask Jeeves -- the other three major search companies that provide their own voices of what's deemed relevant on the web." (See also the collection of links on this Search Engine Watch page.)

• MarketWatch: "As Google sits in the spotlight with fourth-quarter results set to be released Tuesday, Microsoft's MSN is taking away some of the headlines by unveiling its rival search engine product and a big marketing campaign."

• ResearchBuzz weblog: "For the most part the results look all right. I'd like to see more advanced search options, help for the news search, and size on the page result listings."

Update, Tuesday evening: Some more links: Paul Thurrott reviews MSN Search on the Windows SuperSite, and Forrester Research analyst Charlene Li offers a prediction on her weblog: "MSN Search will chip away at Google's share." And Business Week's Jay Greene has this news analysis.

More on Microsoft and EU

IDG News Service reports on the latest twist in Microsoft's ongoing European Union antitrust saga:

The European Commission is battling to ensure that a new, "reduced" version of Microsoft's Windows operating system will appear palatable to customers, but its efforts may be in vain: Most of Europe's biggest PC makers said they don't plan to offer the software anyway.

The commission has said it hopes Microsoft rivals, such as RealNetworks, will be able to make deals with computer makers to choose the stripped-down Windows version and install their competing media players. I asked RealNetworks late last week whether it had made any progress on that front, and a spokesman said the company didn't yet have anything to announce on the subject.

Some additional coverage of Bill Gates' visit to Brussels: