Subscriptions from online games are now bringing in $1bn a year in the US, according to a report by the NPD research firm.

Its data cover massively-multiplayer PC games (MMOs) such as World of Warcraft, casual games and console services such as Microsoft’s Xbox Live.

NPD gave the top five MMO games as World of Warcraft, then Runescape, Lord of the Rings Online, Final Fantasy XI and City of Heroes.

Top online gaming sites were Pogo.com, followed by RealArcade.com, Bigfishgames.com, Gametap.com and Disney.com.

Video game publishers are increasingly looking to online and recurring subscriptions to give themselves extra, steadier revenue streams compared to the lumpy retail sales of games.

Activision will achieve that balance with the merger with Vivendi’s games division by mid-year, combining its powerful game franchises with World of Warcraft from Vivendi’s Blizzard studio.

In its fourth-quarter earnings report on Thursday, Activision followed in the footsteps of Electronic Arts and THQ in announcing it would begin recognising a substantial amount of net revenues and cost of sales from online-enabled games over a service period, expected to be six months beginning the month after shipment.

“I still think that the bulk of Activision revenues will come from the sales of retail products, Blizzard is a different situation,” Bobby Kotick, chief executive, told me.

Activision had a blow-out quarter and year. Revenues for the fiscal year to March 31 of $2.9bn were up 92 per cent, helped by the success of its Call of Duty 4 combat game and the Guitar Hero III rhythm game. Fourth-quarter revenues were up 93 per cent at $602.5m even though no new titles were released.

“The one thing I think we are starting to see is new users,” said Mr Kotick.

“You are seeing the older demographic and some younger consumers coming in. The type of content like Guitar Hero is more broadly appealing, production values are better - the developers of Grand Theft Auto did a brilliant job - and the physical interface is improving with products like Guitar Hero and the Nintendo Wii. All this is driving new consumers and I think that will continue.”

Advanced Micro Devices’s annual meeting today was a surprisingly placid affair, considering its share price has nearly halved in value over the past year.

Existing directors were re-elected without a murmur and there was only one question from the floor: a stockholder asking if AMD would consider sponsoring golf tournaments.

Hector Ruiz, chief executive, is under more pressure from analysts, questioning whether AMD can continue in its present form and whether it can return to profitability this year after six consecutive quarters of losses.

The stock is up 13 per cent in the past week on analyst speculation that AMD could be split into two - a manufacturing business and a chip design and development one.

Mr Ruiz said progress was being made towards an “an asset-smart strategy” and he would give an update on this “complex undertaking…in the very near future.”

He said AMD would spend only $900m in capital expenditure in 2008, it was cutting its workforce by 10 per cent and this reduction in expenses would bring down the break-even point by hundreds of millions of dollars, making him confident of a return to profitability in the second half.

AMD would do fewer things better, he said, and get out of non-core businesses that did not have “a clear path to profitability.”

Production problems with its quad-core “Barcelona” family of processors were now behind it, he added, and AMD was on course to begin quad-core production on chips with more economic 45-nanometre circuit widths in the second half - about a year behind Intel.

His most intriguing comment on the battle with Intel was: “We are re-architecting the business so that our financial success is not invariably dependent on continued component performance leadership over a rich and dominant competitor.”

That is as close as AMD is likely to come to admitting defeat, having gone toe-to-toe in recent years with Intel, exchanging processor-advance punches.

Intel now appears to have a decisive lead in the x86 processor market that the two dominate. Mr Ruiz is suggesting his company will focus on expanding in other areas such as graphics chips or targeting specific segments such as processors for small businesses,  in order to grow its own business in the future.

I know the web has advantages over print in terms of delivering news in a timely manner, but I never thought the colour of my shirt would determine the online headlines I receive.

MSNBC.com’s Spectra news visualisation tool links to a webcam to read the colour of your clothing and serve up headlines from matching news categories. It also delivers them as a 3-D customisable whirlwind of stories that can be clicked on.

The application is part of the service’s NewsWare platform of digital tools launched this week.

It also includes NewsBlaster, an online game where players can shoot and explode orbs that release headlines to be captured and read, and NewsScroller, a build-your-own news ticker.

Personally, I don’t have the patience nor the shirt wardrobe to consume news in this gimmicky way, although I have taken to the NewsSkimmer headlines screensaver, now that my Realtime.com one has closed down, without a word from its RealNetworks parent.

There is a race on to develop Rich Internet Applications (RIAs) for the desktop between Adobe, Google, Microsoft, Mozilla and Sun Microsystems.

Those five are trying to wow us with examples of RIAs as cool widgets running inside or outside the browser, with some working when your PC or other device is offline.

Adobe’s technology is called AIR, Google has Gears, Microsoft has launched Silverlight and Mozilla plans Prism for its Firefox browser.

At Sun’s JavaOne conference in San Francisco today, the company touted JavaFX with three cool demos.

Connected Life is a widget that can exist as a Facebook or blog application or be dragged outside the browser. It combines feeds such as Twitter messages and Flickr photos to show you what your friends are up to. Photo Flocker allows Flickr users to search for photos by tags and throws up results in a 3D interface. Movie Cloud is a 3D sphere spinning around with dozens of high-definition videos that can be clicked on and played.

JavaFX apps were also shown working just as well on a mobile phone. Developers will be able to get their hands on a tool kit to build applications from July.

JavaOne also featured the rock star Neil Young. There was no performance of Sun chief executive Jonathan Schwartz’s favourite song, Rockin’ In the Free World, but a demonstration was given instead of how Java was helping to build the artist’s archive of his work on Blu-ray discs.

Young seems to have come up with the most imaginative use to date of Blu-ray’s new BD-Live interactive features. He has chronicled his life as an artist and plans to release the first period, 1963-1972, in the autumn.

That will take up 10 discs and at 50 gigabytes per dual-layer disc that could be 500GB of material, enough to satisfy even the most ardent fan. By the time he is finished, the life story could be a 50-disc collection.

The Blu-ray technology allows high-def audio to be played while listeners sift through relevant archival material such as photos, notes, videos and memorabilia such as concert tickets. The biography and timeline can also be updated by downloads and contributions from fans.

“Previously, there was no way to browse archival material on a disc and listen to a song in high resolution at the same time,” said Young.

“Previous technology required unacceptable quality compromises. I am glad we waited and got it right.”

Silicon Valley’s growing alter ego as Smartphone Valley has been boosted by Ericsson’s announcement today that it is opening a research centre in San Jose.

Its chief technology strategist, the 30-year company veteran Jan Uddenfeldt, will also move from Sweden to the Valley.

The initiative follows Nokia’s December decision to name its first non-Finn chief technology officer - Bob Iannucci - and base him in Palo Alto. The American headed its Nokia Research Center there, opened in 2006.

Apple’s introduction of the iPhone, Palm’s presence, a host of emerging telecoms start-ups and the move of PC applications to mobile phones has made it essential for industry leaders to take a stake in Valley innovation.

Ericsson, whose focus is network infrastructure, acquired the Valley’s Redback Networks and its IP routing technology in 2006 for $1.9bn and paid $1.4bn a year ago for Norway’s Tandberg Television, which has IPTV assets. It also acquired Santa Clara-based broadband equipment maker Entrisphere last year.

Bert Nordberg, Ericsson’s most senior North American executive as chairman of Redback and Entrisphere, moved to San Jose three months ago.

He told me the plan was to open a campus there for all of its acquired companies as well as core Ericsson staff. Its 1,000 employees in the Valley will move in this autumn and the centre has been designed for 1,500.

“We think it’s going to be manned by experts on mobile coming from other companies and within Ericsson, then some acquisitions and new hires,” he said.

“With the [fourth-generation Long Term Evolution] LTE technology coming and speeds of up to 100 megabits a second over the network, anything is possible. The PC-centric world is in North America and that’s why we believe a lot of the future will start here. We will have a base here in the Valley for building an LTE ecosystem.”

Jittr, the video delivery network, emerged from “stealth mode” today as Vusion, a name change that seems necessary given its claims of providing jitter-free high-definition pictures over the internet.

The Silicon Valley company also announced its first customer: Island Def Jam Music Group, which has a roster including Mariah Carey, Kanye West, Rihanna and The Killers. The Vusion platform will deliver an online video portal of DVD-quality versions of the artists’ music videos.

Jittr is entering a crowded space dominated by big names Akamai and Limelight. Other notable content delivery networks (CDNs) include Move Networks, which powers ABC television’s high-quality video, BitTorrent, Vuze, Edgecast, Grid, Level 3 and Panther Express.

The Streamingmedia.com blog tracks more than 40 CDNs. It says the market is too crowded and a shakeout is inevitable.

However, Grover Righter, Vusion’s marketing chief, insisted in an interview that the company was not a CDN.

CDNs focused on servers on the edge of networks, http downloading, caching and serving flash video and images, he told me.

Vusion was focused on longer format, high-quality video served over the regular internet but processed by its servers in data centres, using its proprietary Wide Area Rapid Propagation (Warp) protocol.

Warp essentially is the secret sauce that allows Vusion to serve video in a way that it claims eliminates buffering - so there is an instant-on for the video plus channel-changing without delays.

Mr Righter says media companies at last month’s NAB broadcasters convention in Las Vegas were so impressed with the technology that they were now planning to bring forward 2010 plans for high-definition video over the internet by 18 months.

“This is a rapidly growing market, there’s room for several players and I think ours is a better machine,” he said.

The San Jose start-up was founded two years ago and has under 50 employees. It has received an unspecified investment from BlueRun Ventures, the Nokia-backed VC fund.

It may or may not be a CDN, but it is chasing the same customers and a lighter less-expensive infrastructure than its rivals could allow it to undercut their prices.

Nile Guide, the latest online travel site to launch, lets trip planners print out their own guide books, although its destination list at this stage is far from comprehensive.

The site itself is also limited - it only works with the latest version of Internet Explorer and Firefox. I could not access it on Firefox when it first launched this week and extracting information from it was as painful as getting baggage out of Heathrow’s Terminal 5.

But response times now seem to have picked up and there are some nifty features to explore.

As a Bay Area company, San Francisco and its surrounds are understandably well covered. I was most impressed with the way searches for places to stay and see could be quickly narrowed down on the fly.

Select the lodging tab for San Francisco and more than 600 hotels come up. Check a box for hip hotels and for a Union Square neighbourhood and the list narrows itself down to 19. Move a slider to five-star-rated hotels and you are down to the Ritz Carlton and Campton Place.

The user can then drag the hotel across to a trip planner column and use it to continue the search by finding places in close proximity. The right kind of nightlife can be pinned down with an “energy” slider control and walks can be judged with a “strenuousness” slider.

All the information found can be dragged into a set itinerary and printed out with photos for a personalised guidebook.
Nile Guide is missing a few elements. It could use an up-to-date listings service so that shows and other events could be added to an itinerary. It also lacks integration for flights, car hire and hotel bookings made on other sites.

This is something that longer-established site Tripit does very well: automatically aggregating all of your bookings for a trip into a printable itinerary and also incorporating information about your destination. Travel plans can be published as well to alert friends and fellow travellers that you may be in their area.

While Tripit is more practical, Nile Guide is prettier, as is Dopplr, another service that helps you to hook up with friends and frequent travellers.

Josh Steinitz, chief executive and co-founder, says Nile Guide has been in development for two years and partnerships for events listings are in the works, as well as more destinations than the 80 currently available.

Data sources are sites such as CitySearch, Expedia, OpenTable and TripAdvisor, supplemented by guidebook content, user ratings and a number of local experts checking the quality of entries.

Mr Steinitz himself has written about and photographed his visits to more than 50 countries and helped to build Away.com, later sold to Orbitz. Draper Richards and KPG Ventures are investors in Nile Guide, which is still a few stops and features short of a full itinerary.

Building B, a Silicon Valley media start-up, has emerged from more than two years in stealth mode to announce a new “TV 2.0″ business model.

But for all its talk of innovation, its Sezmi service is most likely to win consumer support as a cheaper alternative to satellite and cable TV providers.

Sezmi aims to offer TV channels at low-cost by using existing infrastructure. Its set-top box will tap a broadband internet connection and the spare capacity of terrestrial broadcasters to download programming to its hard-drive, while a sophisticated indoor aerial will enable live over-the-air digital channels to be seen.

Sezmi will therefore partner with terrestrial broadcasters and internet service providers (for a graphic explanation of how it is supposed to work see this diagram from the local San Jose Mercury News).

The company seeks to make a virtue out of this hybrid model with the TV 2.0 label. This means presenting personalised programme lists for each member of a family , allowing them to choose to watch what they want, when they want, including internet-based video.

A commercial launch is touted in several major US markets later this year, but Sezmi has to convince consumers this is the future and faces an uphill battle against the incumbents.

Its biggest weapon will be price, but there is no word as yet on what it plans to charge.

Building B has attracted some big industry names. Phil Wiser, its president, is Sony’s former chief technology officer in the US, while Andy Lack, Sony BMG Music Entertainment chairman, is on the board

Morgenthaler Ventures, OmniCapital, Index Ventures and private investors took part in a $17.5m financing round last August.

Bob Pavey, a Morgenthaler partner, said breathlessly at the time: “I am as excited about Building B as I was about Apple when I first invested in them.”

Intel and Cray have been talking this week about building supercomputers with a million cores or brains, but how will all those processors-within-processors work together and communicate with one another and how difficult will it be to write applications that take advantage of all of them?

This is the question that Stanford University hopes to answer with its Pervasive Parallelism Lab, announced on Wednesday.

“Parallel programming is perhaps the largest problem in computer science today,” said Bill Dally, chair of the Computer Science Department.

“[It] is the major obstacle to the continued scaling of computing performance that has fuelled the computing industry, and several related industries, for the last 40 years.”

The problem has arisen because multi-core processors were too expensive until recently for all but high-performance computers, meaning few programmers have developed the expertise to take advantage of their new, affordable abundance.

Stanford says computer scientists fear the progress of computing could stall and that’s clearly a worry for the major microprocessor suppliers - Intel, AMD, IBM, Nvidia, HP and Sun are all supporting the new lab, which will pool the efforts of the university’s leading computer scientists.

It is also not the first initiative of its kind. Intel and Microsoft announced last month  they were investing $20m in research at the University of California at Berkeley and the University of Illinois at Urbana-Champaign  in the same area.

Stanford’s lab has a budget of $6m over three years. The aim is to develop a complete parallel computing system, covering everything from fundamental hardware to new user-friendly programming languages. This could lead to the system doing all the work for developers to optimise their code for parallel processing.

Tim Draper of famed Silicon Valley venture capital firm Draper Fisher Jurvetson has listened to hundreds of pitches from start-ups over the past few years, but only three put themselves forward as alternatives to the online marketplace eBay.

“I was surprised when he told me that,” says James Chong (pictured), founder and chief executive of Wigix, the fourth eBay challenger to cross DFJ’s path.

Wigix’s pitch was impressive enough for the VC firm to lead a recent $5.3m funding round for the Bay Area start-up and for Mr Draper to take a seat on the board.

“EBay has been sitting on its laurels, this area is in real need of innovation,” says Mr Chong.

He spent 11 years at Charles Schwab and the last five setting up its accounts site, before establishing Wigix a year ago.

That explains the financial bent to the marketplace that differentiates itself from eBay by treating items very like company stocks.

EBay started out by offering collectibles, unique items, which goes some way to explaining the site’s sometimes rambling search results.

Wigix argues that most items for auction are now distinct commodities, such as an 8Gb iPod Nano, and they can be found and their market prices tracked more easily by users and search engines when they have their own page and even their own stock-ticker symbol.

Wigix uses the bid/ask principles of buying and selling shares and makes it possible to show current market prices for these commodity items. It says this allows real-time trading and combats the problems on auction sites of shilling and sniping.

A My Wigix section allows users to keep lists of their own possessions, see the market value of them and even name a price at which they would be prepared to sell them.

This gives a notional boost to the liquidity of Wigix’s marketplace. In theory, items may also never leave the marketplace if someone buys something from another user and leaves it on their public list of available items.

Wigix employs around 30 people in offices in Oakland and Beijing, China, but it is encouraging users to help it by suggesting different SKUs and taking ownership of category and product pages. They can earn a cut from advertising on the page and even sell ownership of it to anyone bidding.

Extra features allow users to submit reviews and manuals and ask others about what they think of products they own.

Wigix’s organisation of its auction site makes a lot of sense, but it is likely to be under-represented in items that are hard to classify, such as collectibles and jewellery.

The real test will be whether those items trading as second-hand goods in various conditions can be turned into commodities and traded like stocks and shares.

At its public beta launch on Tuesday, the site was slow and seemed short of inventory, despite its claims of having 500,000 items available.

Nevertheless, it may benefit from dissatisfaction with eBay and its fees structure. Wigix has no listing fees, free trading below $25, a $1.50 fee for buyers above that and a 2 per cent fee for sellers up to $1,000, then 1 per cent above that.

That’s a lot easier to understand than eBay’s complicated explanation of its charges.