“It’s clear to us that we do not want to be in the search engine marketing business,” the company wrote in a blog posting
. “Maintaining objectivity in both search and advertising is paramount to Google’s mission and core to the trust we ask from our users. For this reason, we plan to sell the Performics search marketing business to a third party. We believe this will allow us to maintain objectivity and the search marketing business to continue to grow and innovate and serve its customers.”

“Since our acquisition of DoubleClick closed on March 11, we have been working to match and align DoubleClick employees in the U.S. with our organizational plan for the business,” the company said in a statement.

The layoffs were expected, with Chief Executive Eric Schmidt giving a warning in a blog posting last month.

Google is laying off about 300 employees in its newly acquired DoubleClick ad business, according to a source familiar with the matter.

Meanwhile, Google says it is splitting up Doubleclick’s Performics business unit into two–search marketing and affiliate marketing–and will sell off the search marketing part.

That move, too, is not unexpected. Danny Sullivan of Search Engine Land had called on Google to divest itself of the search engine marketing arm, saying that even if Google keeps its search engine operations completely separate from the search optimization arm, there could be the appearance of impropriety and bias.

The 300 layoffs represent about one-fourth of DoubleClick’s workforce and it’s likely that additional workers outside the U.S. will also be let go.

Apparently Google agreed.

“As with many mergers, this review has resulted in a reduction in headcount at the acquired company,” the statement said. “Today, we are laying off some DoubleClick employees in the U.S. and placing others in transitional roles. We are confident that our combined organizational structure, along with the skills and experience of our new colleagues, will allow us to continue to offer great products and services to our customers.”

The layoff news was first reported by The New York Times.

“As (mobile) gains in popularity…the question becomes what the dominant platform will be,” Wu said. “There will be one platform to rule them all…Control of spectrum is the bottleneck” that either maintains the telecom monopoly model or brings the openness of the Internet to the wireless world.

PALO ALTO, Calif.–If you are like me your eyes probably glaze over a bit when people start talking about wireless spectrum.

Specifically, there is a “battle for platform supremacy between two different types of devices”–mobile versus computer, he said. The mobile platform has a centralized, monopoly legacy whereas the computer platform was born in a distributed, open environment.

Well, maybe consumers should start paying more attention because the debate over how spectrum is managed will determine how we’ll be able to use all types of devices in the future, Tim Wu, Columbia Law School professor, said at a Legal Futures Conference at Stanford University on Saturday.

“The direction is toward mobile, and local, and the power line,” Walker said. “We do well with the Internet…If it will make the Internet more accessible that’s an opportunity for the company and, ultimately, for consumers.”

Someone in the audience asked panel member Kent Walker, Google general counsel, if Google had won its bid for the 700MHz spectrum and, if so, whether the spectrum will be opened. Walker said Google can’t talk about the auction while it is ongoing.

“I’m here to say ‘free the spectrum,’” said Kevin Werbach, professor of legal studies and ethics at the Wharton School of Business and former counsel for new technology policy at the Federal Communications Commission.

Internet companies like Google are battling with traditional telecom companies over requiring open access to spectrum, which would allow people to use whatever device they want on that spectrum.

There is also an increasing call for spectrum to be owned by all the citizens, rather than licensed by the government to corporations to operate.

Samueli, who co-founded the company, also resigned as chairman of the board. The board appointed director John Major to serve as nonexecutive chairman.

The Securities and Exchange Commission has charged two current and two former key executives of chipmaker Broadcom with backdating stock options.

Major said Broadcom would not comment on allegations, but pointed out that the charges were “half a decade to nearly a decade” old.

The move follows Broadcom’s agreement last month to pay a civil penalty of $12 million to settle SEC charges that it fraudulently backdated stock options.

Ruehle and Dull each personally benefited from the backdating scheme by receiving and exercising backdated grants that were in-the-money by more than $100,000 for Ruehle and $1.8 million for Dull, the SEC said in a statement.

The SEC announced Wednesday it had filed a federal complaint against Chairman and Chief Technology Officer Henry Samueli and general counsel David Dull, as well as former Chief Executive Officer Henry Nicholas and former Chief Financial Officer William Ruehle. The chipmaker later announced that Samueli and Dull had taken leaves of absence from their positions until the matter is resolved.

The SEC charges that, from 1998 to 2003, the four schemed to fraudulently backdate stock-option grants, failing to record billions of dollars of compensation expenses, and falsifying documents to further the fraud. As a result of the scheme, Broadcom restated its financial results in January 2007 and reported more than $2 billion in additional compensation expenses, the SEC said.

According to the latest sales figures, Sony has sold roughly 13 million Playstation 3 units worldwide, while Nintendo has sold 25 million Wiis and Microsoft has sold 19 million Xbox 360s. And while Sony won’t cite those figures, it chooses instead to mention “velocity” — the rate at which its sales are increasing.

And while his desire to do that isn’t quite rooted in reality, I guess you can’t blame a guy for trying.

Of course, you don’t need to take my word for it. Kaz Hirai, in a severe understatement, admitted his company has a problem: “There was also some concern in the media and from customers about the lack of titles available at launch.”

That said, I just don’t think either of those strategies can last much longer and both companies will be forced to adapt. When that happens, they will try to play Microsoft’s game and fail miserably.

Sadly, Hirai totally missed it on this one.

But today, that game has changed. Nintendo is still clinging to the value of its first-party titles and Sony has lost a slew of exclusives, including GTA IV. And although the company still has Killzone 2, Microsoft had Halo 3. Although Sony has Metal Gear Solid 4, Gran Turismo 5, and Little Big Planet, the Xbox 360 lineup of games overall is much stronger.

Games, games, games

“I am very confident that after the 10-year life-cycle we will have the installed base that we are looking for and that is obviously to be in the leadership position,” he said in an interview.

I don’t know how many times I’ve said it on these hallowed pages, but I need to say it again — games mean everything to hardware sales once the first year in the new console generation is over. By then, everyone who wanted the new hardware has it and everyone else who doesn’t want to spend money on something that doesn’t entice them, waits for something big.

The online component

Here’s why:

Surely, Sony and Nintendo are downplaying the significance of online gaming, but how can they justify that mentality? According to “Online Gaming 2008″ from NPD, 42 percent of Americans play games online and more than half of worldwide gamers play online. Among console gamers, more than 50 percent use the Xbox 360 to get their fix. But as NPD notes, “there is still a large, untapped market for gaming in general and online gaming in particular.”

Regardless of what’s going on right now, Microsoft is in the best position to win this generation’s console war. Now we just need to sit back and wait for it to happen.

Sony’s online experience is junky, at best. And although it continues to promise more in that arena, it still doesn’t seem nearly as focused as it should be. According to Hirai, Blu-ray discs are still the “best and most efficient way to deliver content” and “when you consider that content that plays on PlayStation 3 can go as high as 50GB it’s going to be very difficult to deliver 50GB to consumers in some parts of the world in a timely fashion.”

Of course, Sony’s Kaz Hirai doesn’t agree with that sentiment. According to the company’s gaming chief, Sony will follow a “ten-year cycle” with the PS3 that should propel it to the top spot in the industry once it’s all said and done.

Lately, there has been a considerable amount of discussion on which console will win this generation’s war. Will it be the
Wii with its established base and strong sales? Will it be the
Xbox 360 with its steady growth? Or will it be the Playstation 3 with its strong sales over the past few months?

In other words, Sony’s online experience will continue to stink.

According to Hirai, Sony is prepared to battle it out in a “marathon” race against Nintendo and Microsoft and he believes his platform has what it takes to win the day.

Are Nintendo and Sony really willing to forego that opportunity and surrender to Microsoft? It certainly looks that way.

In previous generations, this is where Sony performed extremely well. With exclusives from Square-Enix and even Rockstar Games, the company was able to enjoy huge upswings in hardware sales prior to and after, the release of major titles like Final Fantasy and Grand Theft Auto. On the other hand, Microsoft and Nintendo were forced to play catch-up with first-party titles and other semi-major hits.

The Xbox 360 will take the day

But let’s not forget that Nintendo is not innocent in all this. If it weren’t for first-party titles, I’m not convinced that the Wii would be nearly as popular as it is today. And now that almost every major Nintendo title is already available, how much longer should we expect the company to enjoy such strong sales?

There’s no debating the fact that Sony sales are stronger and although the Wii still reigns supreme, it’s viability is running low and the chances of it maintaining such a lead in the industry is quite slim. All the while, the Xbox 360 is the forgotten player in this market that’s still enjoying hearty sales without any major price drop — a contributing factor to Sony’s gain — in sight.

Although it’s currently sitting in the second spot, Microsoft’s Xbox 360 will come out the winner of this generation as long as it maintains its strong relationship with developers and continues its dominance in the online space. If nothing else, Sony has shown that it will continue to cling to its outdated business model hoping for a redux of the 1990s, while Nintendo will try to stay true to its innovation plan.

(Credit: CNET News.com)

Now I know what you’re thinking — “how?” The answer is actually quite simple: the Wii is not nearly as strong as some want to believe and Sony’s strong growth is the result of a lower hardware price, which is allowing it to catch up to the pack.

The way I see it, those problems are still present.

There’s no debating the fact that in the video game industry, Microsoft reigns supreme in the online space. Over the past few years, Microsoft has single-handedly create an online experience that not only manhandles Nintendo and Sony’s attempt at online entertainment, but has millions wanting more. Beyond that, it’s an important selling point when customers need to decide between the
PS3 or Xbox 360 versions of a title. Let’s face it — wouldn’t you rather play GTA IV on Xbox Live?

With that in mind, you’re probably wondering why I think the Xbox 360 will take the day when it’s all said and done. Suffice it to say that as it stands, Microsoft has the best strategy in place to appeal to the biggest group of gamers and create a greater value proposition for its customers.

On the other hand, Nintendo is working diligently to look like a company that cares about online gaming, but most of the integration on that front has been mediocre. To make matters worse, the company’s online roadmap is practically forgotten and it seems like it’s more focused on “innovation in gaming” than anything else. That’s a mistake.

Apple was among the rare companies to end in positive territory, closing regular trading $98.14, up $1.07, or 1 percent.

I talked about the stock drop on today’s CNET News Daily Debrief, above.

SAP, which warned on Monday that its third quarter sales fell below estimates as business spending on software dropped, saw its shares off more than 15 percent, changing hands near the close at $39.76, down $5.89, or nearly 13 percent.

Yahoo shareholders, meanwhile, have even more reason to resent management that rejected Microsoft’s $33-per-share offer. Yahoo shares closed Monday at $15.19, down 81 cents, or about 5 percent.

(Credit:
Susan Dove/CNET Networks)

Updated at 1:20 p.m. PDT with closing stock prices.

The Dow Jones Industrial average was down more than 700 points in mid-day trading, but recovered to close at 9,955.50 points, down 369.88 points, or 2.6 percent. The Nasdaq, meanwhile, dropped below 1,800 points, before closing at 1,862.96, down 84.43, or 4.3 percent. The CNET Tech Index closed Monday at 1,267.87 , down 63.1 points, or 4.7 percent.

Tech stocks took another beating on Monday, although shares recovered somewhat in the final two hours of trading.

Several major indexes, including the Dow and Nasdaq, traded at multiyear lows during the session, while the CNET Tech Index was at its lowest point since 2006.

The Eee PC certainly is bringing cachet to the tiny, Linux-based laptop segment, but will that translate to the cheaper Classmate PC? The Classmate is a bit clunkier looking, and has a silly-looking (though great for kids) handle on the spine, whereas the Eee comes in a variety of colors and looks like a laptop an adult wouldn’t mind being seen with at his or her local coffeehouse.

Intel plans on expanding the distribution of its inexpensive, school children-friendly Classmate PC to U.S. and European retail outlets, according to a Reuters report on Wednesday.

The XO from the One Laptop Per Child initiative, which also builds low-cost notebooks for the same markets, has been available via retail in the U.S. for a while. OLPC had a promotion where consumers here paid $400, which bought one XO for them and one for a school kid in the developing world.

The Classmate will sell for $250 to $350, Lila Ibrahim, general manager of Intel’s emerging market platform group, told Reuters. Apparently Intel has already been conducting pilot programs using the devices in classrooms in the U.S. and Australia.

Intel's Classmate PC

But they’re not the only ones jumping into this fray. Asus launched its low-cost, stripped-down Linux-based Eee PC last fall specifically for the U.S., Japanese, and European retail markets, and caused quite the stir. It sold 350,000 units in the first quarter it was available here, and is making some of the biggest names in computing a wee bit nervous. It’s giving pause to worldwide PC leader Hewlett-Packard, and second-largest notebook manufacturer Acer, both of whom are said to be readying their own low-cost, small form-factor laptops for sometime this year.

(Credit:
Intel)

More low-cost laptops are headed to a retailer near you.

Intel designed the PC for use in schools in developing nations. Local manufacturers build them with customized software configurations for the needs of specific local markets.

It’s not clear whether the museum Wi-Fi will also let visitors access the Web as a whole, or just the internal museum site. Requests for clarification were not immediately answered.

MoMA announced Monday that it has installed a museum-wide Wi-Fi network so that visitors can access a mobile Web site on handheld devices with HTML browsers, which basically means Apple’s iPhone and
iPod Touch. They can then load up audio tours and commentary; content is available in eight languages as well as in specialized versions for children, teenagers, and the visually impaired.

Additionally, MoMA has put its library of audio and video programming into podcast format for Apple’s iTunes Store’s iTunes U education section: current and past audio programs, content from panels and lectures, and video clips from exhibit installations and artist interviews.

Museum visitors who are particularly information-hungry can also now use “interactive kiosks” in the form of a number of Apple’s iMac computers stationed around MoMA, featuring detailed museum information, artist biographies, events listings, and e-card services.

It’s easy to tell someone to update their drivers, but it’s not so easy to do, especially if the device is more than a year or two old, and the hardware vendor has abandoned it. First, you have to search the vendor’s site for the latest driver for that specific model, and after you find and download it, you have to open Windows Device Manager, navigate to and double-click the entry for the device in question, and then run the Update Driver wizard, pointing to the new driver when prompted to. On top of everything, there’s no guarantee the new driver will solve the problem.

You may have more luck using System Restore to turn back the clock to a time when the device worked, but this is no guaranteed fix either. Another longshot is running Windows’ built-in troubleshooters. In my experience, they’re a waste of time: I must’ve tried the troubleshooting wizards dozens of times over the years, and not once were they any use. You’ll find them in the troubleshooting section of the inappropriately named Help and Support Center: press F1 from the desktop to open the app.

XP’s Network Diagnostics tool lacks the troubleshooting chops of its Vista counterpart, but it can help you pinpoint the location of the failure. To run it from Internet Explorer, click Tools > Diagnose Connection Problems. To open it without IE, click Start > Run, type %windir%\network diagnostic\xpnetdiag.exe, and press Enter.

Diagnose network disconnections in Vista and XP
One of Vista’s most useful new tools is the revamped Network Diagnostics utility. When a Web page won’t load in Internet Explorer, you may be prompted to run the utility by clicking Tools > Diagnose Connection Problems. You can also open the program by clicking the network icon in the system tray, choosing Network and Sharing Center, and clicking Diagnose and Repair in the left pane.

Rather than looking to Windows or the device’s vendor for help diagnosing your problem, your time may be better spent searching one of the many Web forums for the category of product. Two of my favorites are those at Tom’s Hardware, and CNET’s PC Hardware Forum.

Ping a Web site from Windows' Command Prompt to determine whether the link to your ISP is working.

Tomorrow: automate your online storage without spending a dime.

Fixes for AWOL hardware
If a printer, monitor, or other device starts acting up, make sure all cables are plugged in tight, and all adapter connections are nice and snug. You might think it’s an urban myth, but it happens: about a year ago I thought my hard drive was toast, but it turns out an internal cable had come loose. (Also make sure the danged thing is powered on; that happens too.)

If everything checks out with your PC’s network settings, ping your ISP’s servers to make sure the connection is working. Click Start > All Programs > Accessories > Command Prompt, type ping cnet.com (or any domain name), and press Enter. If your network link is working, you’ll see four lines of replies, followed by a list of ping statistics. A failed ping test indicates a lost connection to your ISP. Before you get on the horn to your ISP, try turning off your router and then turning it back on again. This is sometimes sufficient to reset the device. If that doesn’t reestablish your network link, it’s time to get on the phone to the company’s support line. (To get a more detailed look of the path packets take from your PC to a Web site, type tracert, the domain name, and press Enter to see a list of all the stops the packets make along the way to their destination.) When you’re done, type exit and press Enter to close the Command Prompt window.

Some problems the program will fix automatically, but it may also display instructions for correcting the glitch manually, or it might simply point to Vista’s Help and Support file. The tool can’t diagnose problems outside of the local PC, such as your ISP’s servers being down, but it helps you determine whether the source is in your system or something else.

In an interview, Microsoft division president Kevin Johnson talked about the common “passion for innovation” at the two companies. That’s probably true, but all companies, at least all good ones, can be defined by their passion. Both companies have also been accused of suffering from an identity crisis.

Johnson said that Microsoft has learned a great deal from its acquisitions of Tellme and Aquantive, though he acknowledged the significant size difference between swallowing Yahoo and buying those smaller companies.

“Certainly the process is the same,” Johnson said, “This will be a more complex integration planning effort than Tellme and Aquantive.”

Plus, the two companies tend to be strong in different regions. In Europe, for example, Yahoo tends to be weaker and Microsoft stronger. In the U.S., the two companies tend to attract different audiences with their mail products–Yahoo Mail appealing to younger and more savvy users, while Windows Live Hotmail has strong roots as an e-mail service for non-techies.

The folks in Redmond are known for being hard-charging and competitive, both internally and externally. Yahoo, meanwhile, tends to be more collaborative, sometimes to the point of inefficiency.

One of the big differences is the amount of overlap between Yahoo and Microsoft on the product side. Both companies have their own advertising platforms as well as competing home pages, instant messaging programs, e-mail programs and content sites.

“I recognize the fact the Yahoo brand is a strong brand,” Johnson said in an interview, echoing comments made on the call. MSN, notably, didn’t get such an endorsement.

Differences such as these are important to consider when one is planning to fork over $44 billion. Now obviously, Microsoft faces a number of hurdles (winning approval from Yahoo’s board and shareholders, gaining the antitrust OK) before it even gets to this point. But these are the kinds of challenges that Microsoft should be, and probably is, trying to solve.

And, clearly, many of Microsoft and Yahoo’s businesses would benefit from greater scale a point Johnson brought up frequently in the interview and on a conference call with financial analysts. The companies already have instant messaging that is interoperable, but a single product would doubtlessly be more attractive. In search, in ad-serving and in content, a combined company would be a larger rival to Google.

There are philosophical differences as well. Yahoo has been a huge proponent of open source, Microsoft a reluctant one.

But each time the company picks a technology to go with, it creates winners and losers and the potential for animosity builds. Microsoft was quick to say that it would be a team of people from both companies that will need to make decisions, but it also gave the strong sense that it has done significant planning work already.

The company didn’t tip its hand too much, but Microsoft executives said on the call that Windows Live was an important brand, as more of the operating system’s duties move online. Office Live, for similar reasons, is also important. Microsoft also praised the Yahoo brand.

Microsoft has been a company of offices, where workers toil individually at their piece of a collective project. Yahoo, by contrast is a Silicon Valley archetype where workers sit in cubicles and tend to work collaboratively.

When you look at the cultural differences between Microsoft and Yahoo, you don’t need to look much further than a floor plan.

The customer contacts support and is immediately assigned a ticket number and is also informed as to the escalation path (with names and possibly contact information) should the initial support technician be unable to resolve the issue.
The support technician informs the customer of the likely causes of the problem and also suggests the different fixes she’s going to attempt.
Support gives the customer a Twitter feed to follow (or some sort of RSS feed) that details the different efforts underway to fix the issue, both successful and dead-ends.
In tandem, the customer is given a support portal in which she can search the web for answers, search the company’s knowledge base for answers, contact other customers for answers (the community effect), or interact with non-Support personnel for answers. The idea is to get more interaction/different takes on an issue, rather than fewer.

Is transparency a bad thing for support? If not, why aren’t more companies doing business this way?

Now, I’m not experienced with technical support, so perhaps these are bad ideas for reasons unknown to me. But I like the idea of transparency in support. I want to know exactly what Apple is thinking when it works through my issues. I’ve found in the past when I have a real conversation with support (Apple’s, in particular), I’m able to short-cut some of their efforts because their proposed fixes cause me to remember things that I’ve tried or things that I’ve done to the system that might have contributed to the problem.

commentary

I’m not sure that open-source support is much different, but in talking with my company’s head of support today, I’m wondering if there’s a better way. We try to be more permeable in how we conduct support, but perhaps open source has something radically different to offer. It would look something like this: