Microsoft News Tracker

Besides investing in search technology, Microsoft is growing its search customer base directly by signing up partners like Nokia and now China Telecom:

Microsoft will provide China Telecom, the nation’s biggest Internet service provider, with a Web search service to try to raise the carrier’s share of the Chinese Web market, the companies said Tuesday.

Microsoft will provide its Live Search service to China Telecom’s 25 million broadband customers and more than 80 million Internet users, the two companies said at a briefing in Beijing.
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The agreement will allow Microsoft to tap into “China Telecom’s strong broadband subscription base,” said Jenny Szeto, an analyst at Daiwa Institute of Research. Szeto has an “outperform” rating on China Telecom’s stock.

Microsoft is working with China Telecom to raise its share of the Internet market in China, whose users are expected to double in five years, according to the market researcher IResearch. The world’s biggest software maker has invested hundreds of millions of dollars on its search engine to lure customers away from Google. Microsoft trails Baidu.com, Google and Yahoo! in China.

Windows Live Search just launched on September 11 and already the Live logo is on the China Telecom portal home page. I expect it doesn’t hurt that they are using Microsoft web servers.

Update 9/24: LiveSide’s Kip Kniskern points to a Xinhua news service report that has some further details:

Before entering into the agreement with Microsoft, China Telecom terminated its cooperation with Yahoo! in search services in August.

China Telecom has also instructed its provincial branches and portals to adopt Microsoft technologies and terminate cooperation with other search engines.

Earlier media reports said the cooperation would last till 2008,and that China Telecom would share revenues of the search engine service with Microsoft on a 70-30 split in 2007 and 50-50 in 2008.

In addition, Microsoft will pay 21 million U.S. dollars to China Telecom as a base income.

Both parties declined to confirm the report.

There’s another serious zero-day Microsoft security exploit in the wild hitting Internet Explorer and Outlook and the citizens are taking matters into their own hands instead of waiting for the Microsoft cavalry. I think I’ve heard this story before. Maybe twice. The twist is now that the citizens are more organized as Ryan Naraine reports at eWeek:

A high-profile group of computer security professionals scattered around the globe has created a third-party patch for the critical VML vulnerability as part of a broader effort to provide an emergency response system for zero-day malware attacks.

The group, known as ZERT (Zero Day Emergency Response Team), was formed in the aftermath of the WMF (Windows Metafile) attacks of December 2005 and is now emerging from stealth mode with an unofficial patch that offers temporary respite from a spate of drive-by malware downloads aimed at users of Microsoft’s Internet Explorer browser.

The patch, which was created and tested by a roster of reverse engineering gurus and virus research experts, is available from the ZERT Web site for Windows 2000 SP4, Windows XP (SP1 and SP2), Windows Server 2003 (SP1 and R2 inclusive).

“Something has to be done about Microsoft’s patching cycle. In some ways, it works. But, in other ways, it fails us,” says Joe Stewart, a senior security researcher with SecureWorks, in Atlanta.

“It is clear that we are dealing with an underground group of people who are writing exploits for profits. They are waiting for Patch Tuesday to pass, then it becomes Exploit Wednesday. We’re seeing these zero-days in the wild, timed precisely to guarantee at least an entire month to spread,” Stewart said in an interview with eWEEK.

There’s much more about ZERT by following the link and more about patching for this exploit at the SunbeltBlog. Sunbelt Software originally discovered the exploit.

As had been expected (see also [1]), Microsoft confirmed plans to ship all consumer versions of Vista on a single DVD all the better to enable “Windows Anytime Upgrades” to premium versions:

“The edition of Windows Vista that the customer chooses will then be activated by the product key,” Mike Burk, public relations manager for Windows Marketing Communications, said in an emailed statement.

“For instance, if a customer buys Windows Vista Home Premium from a retail store, the full version of Windows Vista will be included on the DVD.

“But because the customer chose and paid for Home Premium, the product key he or she receives will activate the Home Premium edition and its features and functionality.”

Windows Anytime Update lets users purchase updates online. After downloading a digital key, the user inserts the original DVD to install additional software components. Microsoft declined to comment on pricing for the upgrades.

Of course, retail sales are the smallest part of the pie and the question really is how this will work for Vista preinstalled on PC hardware since some vendors don’t provide easily mislaid disks, but instead put all the bits on the hard drive. These days a few GB here or there aren’t such a big deal and if cleverly done, only version differences would be stored, not full separate copies.

Then there’s the always pesky question of dividing the loot:

Rob Enderle, principal analyst with the Enderle Group, told vnunet.com that Microsoft is expected to share the upgrade revenues with system manufacturers. He based his comments on conversations with OEMs.

The upgrade feature will be especially beneficial to small and medium-sized firms which often purchase systems with the consumer version of Windows XP and later realise that they require the additional features in XP Pro, Enderle said.

I expect the OEMs get to handle support calls as part of the deal too. I’ll also be interested to see how many vendors lowball prices by including Vista Home Basic in the system price and letting the user ante up separately for the fancy Aero user experience.

Finally, there’s one other party to be heard from: hackers. I wonder what their share will be?

Windows CE 6.0 was released to manufacturing on September 15 without much fanfare, which is too bad since it is the basis for the upcoming Crossbow release of Windows Mobile and the latter has been making inroads in the cell phone business. Now Microsoft’s Mike Hall reports that the formal launch date is November 1, 2006 and you can get more details at the launch event website. They’ll also be covering Windows XP Embedded SP2 Feature Pack 2007 .

I guess rushing to market has its price. Dean Takahashi at The Mercury News:

Microsoft issued a statement today acknowledging that its early run of Xbox 360s made in 2005 were buggy and that it would rescind any repair fee on boxes that need service as long as they were manufactured before Jan. 1, 2006. The statement is in response to a raft of complaints from gamers such as Chris Szarek, whose story we told on this blog about how he went through four consoles in the repair process.

New repairs will be free, owners that have already paid for repairs will get refunds. You may remember that at the time there were some problems reported in the press and even a class action lawsuit. Nonetheless, it was undoubtedly worthwhile to Microsoft to be there first and before Christmas since the defects weren’t bad enough to earn the Xbox 360 a reputation as a lemon. On the other hand, one wonders how close it came to really bad news.