Buffett buys $10.7bn stake in IBM

14 November 2011 Last updated at 13:09 ET

Warren Buffett - one of the world's most closely watched investors - has disclosed building a 5.4% stake in IBM.

Mr Buffett's Berkshire Hathaway fund started buying shares in the firm in March, eventually spending around $10.7bn (�6.7bn).

The billionaire had steered away from technology firms in the past.

However, he said that he had been impressed by IBM's road map for how it planned to attract IT firms outside the US to sign up to its services.

"If you're in some country around the world and you're developing your IT department you're probably going to feel more comfortable with IBM than with many companies," he told the US television station CNBC.

He said he started buying the stock after he read IBM's 2010 annual report and spoke to technology professionals in the businesses his fund had already invested in.

He said he realised there was a lot of "continuity" in the US-headquartered business.

"It is a big deal for a big company to change auditors, change law firms, or change IT support," he said.

"There's a fair amount of presumption in many places that if you're with IBM, you stay with them."

Revelation

Mr Buffett said he had not told IBM's chief executive, Sam Palmisano, about the investment before announcing it on TV. He added that he does not plan to increase his stake which was why he was comfortable talking about it.

Until now the US bank, State Street, was the biggest known investor in IBM by a clear margin. A September filing revealed the lender owned 5.5% of of the firm.

When asked about other investments Mr Buffett noted that he would never buy stock in Microsoft because of his friendship with the company's founder and chairman Bill Gates.

Mr Buffett's actions are closely monitored by other investors because of his track record for spotting and buying undervalued stocks. However, IBM's shares only rose slightly after the broadcast.

"He is looking for a business that will have double digit bottom line growth and will be reasonably stable in good times and bad," Louis Miscioscia, managing director at financial advisors Collins Stewart, told the BBC.

"That is what IBM shares offer, bearing in mind their software and services business is very consistent."

IBM said it is not commenting on the news at this time.

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Websites to give privacy warnings

14 November 2011 Last updated at 11:24 ET

Internet users will receive a warning if sites do not respect their privacy thanks to new tools being developed by the web's standards setting body.

The World Wide Web Consortium (W3C) wants to help users control how their personal data is managed.

It is designing controls to shield personal data and reveal when sites do not honour privacy requests.

The W3C now wants users, browser makers and businesses to help finish and implement the specifications.

"Users have the feeling they are being being tracked and some users have privacy concerns and would like to solve them," said Dr Matthias Schunter from IBM who chairs the W3C group drawing up the Do Not Track technologies.

Co-ordination

The working group is defining software specifications that will:

• let browser settings tell websites to do less tracking
• let websites acknowledge privacy requests
• define best practices for sites so they can comply with different privacy needs

Dr Schunter said the specifications aim to end the current situation in which different browser makers adopt incompatible Do Not Track systems.

"Currently websites need to implement all these different protocols," he said. "There's no standard way to respect privacy preferences."

"We want to standardise all these protocols so they talk the same language and then tell websites what to do with them," said Dr Schunter.

The tools resulting from the W3C work would aim to be "privacy friendly" and surrender as little information as possible, he added.

For instance, he said, a site could log a user's language preference by noting their name and native tongue and store that in a cookie - little text files sites use to record information about regular visitors.

A more privacy-friendly way, said Dr Schunter, would have browser software note that its owner prefers a particular language without surrendering any identifying information.

Users could be warned about sites that do not do a good job of respecting requests to keep information private.

While the W3C cannot insist that sites and software vendors follow its lead, said Dr Schunter, it was more than likely that they would adopt the technologies.

The finished technologies are expected to be implemented by browser makers first in mid-2012 with websites following soon after as they get to grips with the best practices.

More than 15 firms and organisations are involved in the Do Not Track work including Adobe, Apple, Facebook, Google, Microsoft, the Electronic Frontier Foundation and Stanford�University.

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Iran says Duqu hack 'controlled'

14 November 2011 Last updated at 09:41 ET

Iran has confirmed some of its computer systems were infected with the Duqu trojan, but said it has found a way to control the malware.

Security organisations had previously identified Iran as one of at least eight countries targeted by the code.

The spyware is believed to have been designed to steal data to help launch further cyber attacks.

The sender has not been identified, but researchers have found a reference to a US television programme in Duqu's code.

The Iranian news agency, IRNA, reported that the country's cyber defence unit was taking steps to combat the infection.

"The software to control the virus has been developed and made available to organisations and corporations," Brigadier General Gholamreza Jalali, head of Iran's civil defence body, is quoted as saying.

"All the organisations and centres that could be susceptible to being contaminated are being controlled."

Mr Jalali said a "final report" into which organisations had been targeted was still being worked on.

Third attack?

Last year the Iranian government accused the West of trying to disrupt its nuclear facilities using the Stuxnet worm computer attack.

Then in April 2011 officials said the country's facilities had been targeted by a second piece of malware dubbed "Stars".

Officials now describe the Duqu attack as the "third virus" to hit Iran.

The computer security specialist Kaspersky Lab said it believed that "Stars" was a keylogging program that may have been part of the same attack that installed Duqu.

Keylogging programs are able to collect information about a computer system, take screenshots, search for files and capture passwords.

Thrillers

The firm also provided more detail about how Duqu worked based on its analysis of other targets.

It said another unidentified company received an email from an individual identifying himself as Mr B Jason who requested a joint business venture.

The firm believed this was a reference to the Jason Bourne books and spy movies.

The recipient was asked to open a Microsoft Word attachment that referenced the targeted company's name in its title, and thus did not appear to be spam.

It said that for every victim a separate set of attack files was created using a different control server. The firm said this happened at least 12 times.

When the addressee opened the file the malware became active through a Truetype font exploit, but did nothing until it detected that there had been no keyboard or mouse activity for ten minutes.

Kaspersky Lab said the font was called Dexter Regular and its creators were identified as Showtime Inc.

"This is another prank pulled by the Duqu authors, since Showtime Inc is the cable broadcasting company behind the TV series Dexter, about a CSI doctor who happens also to be a serial killer," the report said.

The firm said the exploit then loaded a driver onto the system. Analysis of the driver suggested it was compiled as long ago as August 2007.

"If this information is correct, then the authors of Duqu must have been working on this project for over four years," the report said.

The firm said the driver then began a process that led to the Duqu trojan being installed allowing the attackers to introduce new modules, infect other networked computers, and collect information.

The company said efforts to identify the attackers have been complicated by the fact that the suspects appear to have deactivated several of the control servers thought to have been involved in the attacks.

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O2 starts LTE mobile London trial

14 November 2011 Last updated at 07:59 ET

The mobile network O2 has started testing a next-generation mobile data service in London.

The nine month trial will involve hundreds of consumers and businesses using a Long Term Evolution (LTE) network across parts of the city.

O2 says its LTE downloads will be many times faster than those over 3G.

The news comes a fortnight after MPs urged O2 and other operators to stop fighting over how 4G airwaves should be shared out.

The experiment is an extension of O2's LTE trials in Slough, west of the capital, which began in 2009.

Participants will be given broadband dongles for their computers allowing them access to the 2.6GHz spectrum.

When the network goes into full-time service it will also include the lower frequency 800MHz band which will be freed-up by the UK's switch from analogue to digital TV.

Acceleration

Members of the trial are being promised download speeds of up to 50 megabits per second (Mbps), although O2 says the network can theoretically transfer data three times faster.

Once the network is rolled out across the UK the firm says speeds are more likely to average 10-15Mbps.

By comparison telecoms watchdog Ofcom said in May that the UK's average 3G download speed was 1.5Mbps.

O2 describes the service as being 4G. However, the International Telecommunications Union (ITU) defines LTE as being 3.9G since it falls short of one gigabit per second transfers.

"Today's launch of the UK's first 4G London trial network demonstrates our commitment to delivering 4G to our customers at the earliest opportunity," said Ronan Dunne, chief executive of Telefonica UK which runs O2.

"The work we are doing now will lay the foundations for our commercial 4G network when it launches in the UK."

O2 said it expects more than 1,000 people to take part. That makes the test bigger than a separate LTE trial being carried out by Everything Everywhere and BT in Cornwall involving 200 residents.

Spectrum sale

Ofcom plans to hold an auction for the LTE radio spectrum towards the end of 2012. However, because the spectrum will not become free until 2013 it will be some time after that before the services can be offered on a commercial basis.

That puts the UK behind other countries including Sweden, South Korea, Germany and the US which have already begun their rollouts.

Earlier this month the Commons Culture, Media and Sport select committee said it was concerned that disagreements among the UK's mobile network operators had appeared to have delayed the auction's process.

O2 and Vodafone are threatening legal action if Ofcom allows Three to buy part of the LTE spectrum at a minimum price. Ofcom wants to ensure there is competition in the sector, but O2 and Vodafone claim the move amounts to state aid.

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Schools focus on cyber bullying

14 November 2011 Last updated at 01:17 ET

Almost 650 schools across Northern Ireland are to explore the impact of cyber bullying this week.

It is part of this year's anti-bullying week which begins on Monday.

According to Department of Education research in Northern Ireland, 15.5% of Year 6 pupils and 17% of Year 9 pupils surveyed have experienced cyber bullying in recent months.

Three-quarters of teachers in post-primary schools surveyed said cyber bullying was more prevalent.

Lee Kane, Regional anti-bullying co-ordinator, said anti-bullying week provided a channel for teachers and parents to challenge all bullying methods:

"We are overwhelmed by the interest from both schools and parents in this year's anti-bullying week," he said.

"It is a clear indication of the concerns that exist in relation to cyber bullying.

"Anti-bullying week is a great opportunity to reinforce key anti-bullying messages for all of those involved in schools - pupils, teachers, support staff and parents."

Cyber bullying can be exhibited through the use of mobile phones, online gaming, email and social networking.

Anti-bullying week will run until Friday.

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Steam game service hit by hackers

11 November 2011 Last updated at 06:25 ET

The Steam video game service, used by 35 million people, has been compromised by hackers.

Its owner and operator, Valve, uncovered an intrusion into a user database while investigating a security breach of its discussion forums.

The attackers used login details from the forum hack to access a database that held ID and credit card data.

Valve said that, so far, it had no evidence that credit cards were being misused or Steam accounts abused.

Losing trust

The defacement took place on 6 November and the Steam forums were taken offline when Valve learned of the attack.

At first the firm said the discussion groups were offline for maintenance.

However, a message posted to the front page of the forums by Valve boss Gabe Newell on 10 November has revealed that the sites were shut down because of the defacement.

Valve's investigation of that incident revealed that the "the intrusion goes beyond the Steam forums".

The initial investigation showed that the attackers gained access to a Steam database that held "user names, hashed and salted passwords, game purchases, email addresses, billing addresses and encrypted credit card information".

Valve has not said whether this was the full database of Steam's 35 million active accounts or a subset of that total.

Mr Newell said Valve had no evidence that the encrypted credit card information or personal information on gamers had been taken. However, he added, "we are still investigating".

He said it had only discovered that a few forum accounts had been compromised and used to carry out the defacement.

But Mr Newell added that all forum users will be required to change their passwords when the discussion site re-opens, which the firm is trying to achieve as quickly as possible.

He advised users to change passwords on other accounts if they are the same as the one used for the Steam forums.

"I am truly sorry this happened, and I apologize for the inconvenience," concluded Mr Newell.

Code changes

Steam is a gaming service that lets people buy, download, play and chat about a huge variety of games, only some of which are made by Valve itself.

About 1,500 titles are currently available on Steam including Skyrim, LA Noire and Modern Warfare 3 as well as many independent and free games.

Security expert Paul Ducklin, writing on the blog of security firm Sophos, handed down advice about what to do following the breach.

He said users should change passwords, monitor credit card statements, consider removing card numbers from Valve's servers and sign up for the Steam Guard security service.

He also urged users to insist businesses take steps to make it much harder for hackers to penetrate their systems and use stolen data.

"Community pressure has persuaded many businesses to improve their password-handling code," he said.

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Facebook privacy overhaul, report

11 November 2011 Last updated at 06:55 ET

Privacy campaigners have welcomed a report that Facebook is to ask users to opt into any changes in the way it uses their personal information.

The social network previously announced alterations to its members' settings without asking for fresh consent.

The website is changing its policy after an investigation by the US Federal Trade Commission, according to a report by the Wall Street Journal.

Facebook is not commenting on the story at this time.

The report suggests the site has also agreed to privacy audits by an independent organisation over the next 20 years.

However, it says the FTC does not prescribe how consent should be obtained.

Suspicion

"Facebook has historically been extremely resistant to transparency in its own operations, so we welcome measures that would force the company to obtain express consent of its users," said the London based advocacy group Privacy International.

"However, it seems likely that the FTC's demands will only present a temporary obstacle in the path of Facebook's ambitions to collect its users' information.

"Faced with reams of small print, most users are likely to automatically agree to policy changes, with each change bringing us one step closer to Zuckerberg's vision of a privacy-free future."

The website's founder, Mark Zuckerberg, was questioned about the firm's privacy policies on the US television network PBS' Charlie Rose show earlier this week.

"You have control over every single thing you've shared on Facebook," he said, "You can take it down."

He also said other search engines and advertising networks gather "huge amount of information" about internet users through cookies, which he claimed was "less transparent than what is happening at Facebook".

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Illegal game downloads 'up 20%'

By Dan Whitworth
Newsbeat technology reporter Big budget games like CoD: MW3 can lose millions through illegal downloads <!-- Empty - Wide embedded hyper -->

The number of illegally downloaded video games has gone up nearly 20% in the last five years.

Figures from research firm Envisional also suggest the top five games from 2010 were pirated online almost a million times.

Industry executives are worried these figures mean a generation of people will expect to get games for free.

But some gamers dispute industry claims about how much of a problem online piracy is.

Illegal 'testing'

Newsbeat met Sam who illegally downloads around 100 titles a year and ends up buying around 50 of them.

"I buy games because I've pirated them, if I don't get to try them I never would have bothered picking them up."

Sam, who didn't want to give his surname, says he's not put off by the threat of being fined or sent to prison.

"I've never been fined. I've been doing this since I was 14 and I'm now 23.

"Games that I enjoy I purchase, ones that I don't enjoy I delete."

But the video games industry says all piracy is theft full stop and the answer lies in offering fair-priced alternatives to illegal downloads.

Andy Payne, chairman of the Association for UK Interactive Entertainment (UKIE) believes it's something the industry is already doing.

"You can be playing that game every single day for a year.

"Look at FIFA, Modern Warfare, Black Ops, those games people are playing all the time. That's great value."

Jobs threat

Earlier this year video game executives told Newsbeat online piracy costs the industry hundreds of jobs and millions of pounds.

However, UKIE is reluctant to give a similar estimate for either, saying it is nearly impossible to get an accurate figure.

It is keen though to emphasise that big blockbuster titles can cost millions of pounds to produce.

"[Some] 200, 250 people sat in a studio for two years building the latest Modern Warfare 3," says Andy Payne.

"This costs real money."

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UK PM hails growth of Tech City

10 November 2011 Last updated at 08:48 ET

The British Prime Minister has unveiled an interactive map of East London's technology cluster, revealing more than 600 firms in the area.

The Tech City map highlights the expansion of Old Street's "silicon roundabout". By comparison there were around 200 tech firms based there last year.

The government said it was acting to support the area's success.

However, some businesses claimed they did not want the attention.

"One year ago we made a major commitment to helping the tech cluster in East London grow," said David Cameron.

"The successful growth we see today is thanks to the talented, creative entrepreneurs who have decided to set up there.

"As a government, we are determined to continue doing everything we can to help support and accelerate this growth."

Support

Downing Street highlighted a 225% rise in the research and development tax credit offered to small and medium sized enterprises, a doubling of capital gains tax relief to �10m for start-up owners and an "Entrepreneur Visa" to help attract talent.

The government is now asking investors and business leaders to tell it what else can be done to cut red tape.

It hopes the cluster will continue to expand further east to the capital's new district, Olympic Park.

Telecoms equipment maker, Cisco, used the occasion to announce it is partnering with a local university to create a centre to research "smart infrastructure".

Intel also revealed it will create a high performance computing cluster to offer local firms the chance to sample its latest technologies.

'Go Away'

Online music service Songkick tweeted that "Our CTO just met with David Cameron to discuss Tech City, apparently 'he was genuinely engaged in helping tech start-ups'".

However, others expressed reservations about all the interest.

"The cluster has arisen spontaneously. It's at a delicate early stage," Andy Bell, chief creative officer of Mint Digital, wrote in a company blog.

"It takes an arrogance for the government to assume that its heavy hand can help it grow. The best thing the government can do is get out of our hair and use the money to reduce their funding gap or, if they really want, throw a big party."

Other tech firms said that they were concerned local rents were starting to rise as big industry players - such as Google - moved into the area.

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Warcraft suffers subscriber slump

10 November 2011 Last updated at 06:19 ET

Almost a million people have stopped paying for World of Warcraft in the last three months.

The sharp drop in subscribers was revealed by Activision Blizzard during talks with analysts about its latest financial results.

At the end of September, WoW had about 10.3 million subscribers, down from 11.1 million at the end of June.

Experts put the decline down to competition from new titles but said WoW was still very resilient.

Free fight

World of Warcraft's subscriber numbers have been on a steady decline from the peak of 12 million they hit in 2010.

Blizzard's boss, Mike Morhaime, said the biggest decline in player numbers was seen in the Asia Pacific region, with significant falls in China.

He said Blizzard had expected to lose subscribers over the last few months as the keenest players exhausted the fresh content that the Cataclysm expansion added to the game in late 2010.

Despite this, claimed Mr Morhaime, WoW remained the most popular subscription game in the world.

WoW has kept its subscription model even though there has been a general move to free-to-play by its rivals. These include Warhammer, Lord of the Rings Online and DC Universe Online.

Continue reading the main story

"Start Quote

Its 10 million plus player-base remains hugely significant"

End Quote John Walker Rock Paper Shotgun

Blizzard has gone some way to embracing this change by letting gamers play for free via an account that limits them to WoW's opening sections, caps how much cash they can accumulate, and restricts what they can do with characters.

The game maker has also unveiled ways to make sure veteran players stay involved. Last month it announced players who commit to a new 12 month subscription would get a free copy of Diablo III, early access to the next expansion for WoW, and a flying horse to ride around in the game.

Despite the decline in players of Wow, Activision Blizzard's results were strong with record third-quarter results up 16% over the same period in 2010.

Games journalist John Walker from gaming site Rock Paper Shotgun said WoW had weathered similar dips in the past when there were other strong titles gamers wanted to play.

At the moment WoW faces competition from games such as Arkham City, Skyrim, Battlefield 3 and Activision's own Modern Warfare 3.

"People tend to only want to give their monthly tithe to one game, and so they'll often slip away to see what's new, before slinking back to Warcraft," he said.

But, he added, the fact that millions still regularly played a seven-year-old game showed its resilience.

"If anything, WoW's persistent success with its subscription model is actually bucking any trend that we may be seeing, even if the numbers have dipped slightly," he said.

"While it's offering a sort of faux free-to-play model for its early stages now, there's no doubt that its 10 million plus player-base remains hugely significant."

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