For the FT’s New Technology Policy Forum, University of Chicago professor Richard Epstein considers the European Commission’s recent fining of Intel for anticompetitive behaviour:

On May 13, 2009, the European Commission fined Intel just over €1bn for its supposed abuse of its dominant market position in violation of Article 82 of the EC Treaty. That decision marks yet another effort by commissioner Neelie Kroes to ratchet up the enforcement of EC competition policy, all in the name of preventing consumer harm. Yet the devil lies in this one detail. The aggrieved “consumer” of Intel is its long-time junior rival, AMD, which filed three separate complaints against Intel between 2000 and 2006.

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  • The economic slump hasn’t ended yet. That was the word from the executives of Microsoft and Dell, as they countered the recent optimistic views expressed by other big tech companies. Steve Ballmer, Microsoft’s chief executive, said: “To think that things would be back in a year seems naive to me.” Brian Gladden, Dell’s chief financial officer, said: “Based on what we see in the marketplace, we’re not comfortable talking about seeing a bottom at this point.”
  • Microsoft and Google took direct aim at each other’s core businesses as they showed off ambitious new services that represent some of their biggest internet development efforts. Microsoft unveiled its new search engine, Bing, to generally positive reviews. Google, meanwhile, stole the thunder by showing-off Wave, a new communication platform that incorporates elements of email, chat and document sharing.

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Microsoft is taking aim at Google’s core business with Bing, its new search engine.

Initial reviews around the web are positive. CNET said, “in search presentation, Bing wins.” Geekword said it was not just renamed Live Search, but rather “a significant upgrade that contains new features and a new interface and is considered as a decision engine.” But Search Engine Land made it clear that, “no, Bing is not a ‘Google Killer.’”

FT reporter Joe Menn attended Bing’s unveiling at the D7 conference, and filed this report:

Microsoft Chief Executive Steve Ballmer gave an impressive demonstration of the company’s improved search engine, rebranded as “Bing,” at a technology conference in Carlsbad California.

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The FT’s editorial board argues that social networks are a challenge to undemocratic societies:

Web 2.0 – user-created content – has created further outlets for subversion, by making it easier to argue online and organise web-based movements. In many countries, political discourse, seared offline, is sprouting on the internet.

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From the FT’s Comment page, Irwin Stelzer, director of economic policy studies at the Hudson Institute, says the US is finally catching up to the EU and getting tough on high-tech anti-competitive behaviour:

For once, America is running at top speed to catch up with the European Union. In levying a record fine against Intel, the world’s largest chipmaker, the EU competition authorities have let it be known that a dominant company’s efforts to crush rivals by threatening customers or rigging a price schedule will not be tolerated.

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  • A Yahoo / Microsoft deal could still be struck if it involved “a boatload of money.” That was the word from Carol Bartz, Yahoo’s chief executive, who said her company is no longer in serious talks with Microsoft over a deal to combine their search efforts. But she acknowledged that negotiations between the two companies were continuing “a little bit”.
  • Time Warner is close to a decision to spin off all of its AOL internet business, according to three people in contact with the company. Although a decision has not yet been finalised, executives prefer spinning off the whole division rather than a part. Over the past year, Time Warner has considered spinning off either its advertising-driven “audience business” or its legacy dial-up internet business, they say.

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Joseph Menn, San Francisco-based technology correspondent, reports from AllThingsD, the annual tech conference put on by News Corp in Carlsbad, California:

Yahoo’s Carol Bartz, who took over as CEO in January, impressed a tough crowd, getting more sustained applause after her onstage interview than the two young men who run yesterday’s New New Thing, Twitter.

Bartz came across as sensible and plain spoken, the logical sort of manager to straighten out an inherited organisation chart that appeared made of spaghetti. Read more

New York media correspondent Kenneth Li reports:

Not all subscribers are born equal.

Imagine my surprise when I, a faithful subscriber to The New Yorker on Amazon’s Kindle, was denied full access to the

That’s what happened yesterday after I tried to pull up a copy of the much-discussed Carlos Slim profile in the latest edition of The New Yorker from its website, but was denied access. It is restricted to print subscribers.

Like other periodicals eyeing a bleak print advertising future, The New Yorker has begun restricting full website access to those who pay for the print copy or pay specifically for the right to access the site. Read more

  • Facebook accepted a $200m investment from Digital Sky Technologies, a private Russian internet investment group, valuing the fast-growing social network’s preferred stock at $10bn. The unlikely union gives Facebook an additional cash cushion, but the $10bn valuation is a come down. Just a year and a half ago, Microsoft invested $240m on similar terms, but valued Facebook’s preferred stock at $15bn.
  • Psystar, the Florida company that was making unauthorised clones of Apple computers, filed for Chapter 11 bankruptcy protection. The move puts at least a temporary end to Apple’s lawsuit against the company, and could indicate that Psystar’s backers have pulled out, anticipating a victory by Apple in court.

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Today’s $200m investment in Facebook by Digital Sky Technologies values the companies preferred stock at $10bn. That’s just two-thirds of what Microsoft valued Facebook at in late 2007, when it invested $240m. The FT’s Lex column examines the difficulty inherant in valuing a private company:

Privacy is a wonderful thing. With a straight face one can say that a company is worth several billion dollars having not produced a single fact to back it up. Similarly the debate about Facebook’s valuation is somewhat futile. There are simply not enough numbers to construct a meaningful picture of the social network’s finances.

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New York media correspondent Kenneth Li reports:

So persuasive a deal maker was Joanna Shields, who talked Time Warner’s AOL into paying close to $1bn to buy out the UK-based social network, AllThingsD’s Kara Swisher once joked that Ms Shields could sell Obama’s stimulus package to the Republicans.

But the astronomical figure for a web property perceived to be hot among British teenagers, although lagging behind Facebook and MySpace in the US drew enough criticism internally that even Jeff Bewkes, Time Warner chief executive, admitted last year it may have overpaid. Read more

John Gapper, the FT’s chief business commentator, says that Wolfram Alpha’s structured database poses long-term questions about the usefulness of internet search:

If all the data on the internet are simply too messy to be analysed and structured, Google will be unable to produce a service rivalling Wolfram Alpha in clarity and reliability. Read more

The FT’s Lex column says that it was high time Lenovo’s optimistic investors were brought back to earth, and that fixing the PC company’s struggling international operations will not be easy:

Founder Liu Chuanzhi, who returned as chairman in February, started by axing 2,500 overseas jobs in a bid to shave about 15 per cent from annual operating costs. But that’s the easy bit.

  • In a peaceful transfer of power, Xerox on Thursday said Ursula Burns would replace Anne Mulcahy as chief executive, becoming the only female African-American chief executive among the Fortune 500’s top 150 companies. Ms Mulcahy, 56, who turned the printing company round after the dotcom bubble burst, will retire on July 1 but remain as chairman. Ms Burns, 50, currently president, is her closest lieutenant.
  • Perhaps it will be Government 2.0, after all. The Obama White House took an important step forward in its promise to use internet technology to make government more open and accountable, a move that helped to ease some of the criticism that has welled up during the administration’s early months. The new initiatives include a website,, through which all types of government data will be released in machine-readable form, and an experimental open blog to shape the White House’s thinking on how the internet can be used more extensively in government.

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  • Google is one of those companies that we generally refer to as a frenemy,” New York Times executive editor Bill Keller said recently. Perhaps, but today Google proved it will be no saviour to the newspaper business, either. Google chief executive Eric Schmidt told the Financial Times that the company had previously considered buying a newspaper or using its charitable arm to support news businesses seeking non-profit status, but is now unlikely to pursue either option.
  • Craigslist is on the offensive. The US-based classified-advertising website has taken legal action against the attorney-general of South Carolina, who had attacked the site over its erotic services category. The company, which came under pressure from law enforcement officials to take down the section, then did so, is seeking declaratory relief and a restraining order against Henry McMaster, who has repeatedly threatened the company and its executives with criminal charges unless it complied with the requests.

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As traditional publishers falter, print-on-demand has been one of the few bright spots in the otherwise slumping book industry, writes Joe Menn:

The first serious bid for a print-on-demand bestseller began publishing on Wednesday, as Rick Smolan launched The Obama Time Capsule, as a customisable book which will be printed only after it is ordered. Read more

The FT’s editorial page turns its eye towards internet law and finds that “just as the law should be no looser or tighter on the internet, the enforcement of the law should be no less transparent, open and accountable.”

The world wide web is not the world’s wild west. Internet law is incomplete and faces practical hurdles which it will take time and thought to overcome. Lord Mandelson, the UK business secretary, was right to be wary this week about clumsy government proposals to impose age ratings on websites. But jurists must not give up on the rule of law on the internet.

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  • Speculation about Facebook‘s finances has once again been swirling, but chief executive Mark Zuckerberg at least provided a bit of clarity. Over the weekend VentureBeat said Facebook was about to close a $150m round to buy out shares from hundreds of employees. Then TechCrunch chimed in with a report that the company turned down a $200m term sheet that valued the company at $8bn because the investors wanted a board seat. Facebook is notoriously tight-lipped, but today Mr Zuckerberg said that his company is in no immediate need of capital, and that he does hope to take Facebook public, but not for a couple of years.
  • Could the worst be over? Hewlett-Packard said that stronger than expected Chinese and US consumer markets helped it beat Wall Street profit projections for the second quarter, and the world’s leading personal computer company by revenue struck a note of cautious optimism on the economy as a whole.

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For the FT’s Business Life page, David Gelles looks at the opportunities and challenges for foreign-born entrepreneurs in Silicon Valley.

Today, Silicon Valley – perhaps more than any other region in America – is a magnet for educated immigrants. With its intellectual capital, high-tech resources and rich coffers, the region is uniquely suited to produce important, profitable companies. “Silicon Valley is an environment that allows people to act on their entrepreneurial instincts with much more success than other parts of the world,” says AnnaLee Saxenian, dean of UC Berkeley’s School of Information and the author of Silicon Valley’s New Immigrant Entrepreneurs. “There is a whole infrastructure for entrepreneurship.”

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  • Look out Amazon. Scribd, a digital document sharing service, is launching an online retail market for books and documents, betting that a surge in interest in reading online will help it transform into an Ebay or an of text. The two-year-old Silicon Valley start-up, whose doubling of audience size every six months has been compared to YouTube’s explosive growth, will let some 60m readers of its service begin charging each other for the rights to access just about anything uploaded to the service.
  • Facebook became a relying party for OpenID, the universal web login standard that is trying to gain traction. That means, for example, that Facebook users with an associated Gmail account will be able to browse Facebook without having to login if they are coming from Gmail. But Google, an issuing party, is not likely to become a relying party anytime soon. Doing so would mean surrendering some control of access to their proprietary accounts.

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