Digital Media

Billionaire investor-activist Carl Icahn opposes selling just a portion of Yahoo, telling CNBC on Wednesday that he believes the company's stock in undervalued.

Carl Icahn opposes a partial sale of Yahoo, saying the company is undervalued.

(Credit: CNET News)

"I don't think there is very much to having a partial bid for the company, at least as a large shareholder," Icahn said.

Icahn, who is on Yahoo's board of directors, made the statement while addressing rumors that former AOL Chief Executive Jonathan Miller is trying to raise money to acquire all or a part of the Internet pioneer. Miller reportedly believes he can do a deal worth about $20 to $22 per share.

Icahn, who purchased an additional 7 million shares of Yahoo last week, told CNBC that he spoke recently with Miller about the possibility of buying Yahoo.

"Right now I would be against that and I pretty much told Jonathan that," Icahn said. "I think the stock is very undervalued."

He also said that while he had not spoken with others on the board about a partial sale, he thought they would agree with him.

In recent months, Yahoo shares have fallen, along with the rest of the stock market, and have been hovering around the $10 mark--a far cry from the $33 a share Microsoft offered in its takeover bid for the company earlier this year.

Icahn was also queried about who he thought would make a good chief executive for the search pioneer after the recent resignation of CEO Jerry Yang. Icahn said the company needed a CEO who is "a hard-nosed, cost-cutting kind of guy," but did not mention any candidates by name.

He also emphasized that he would still like to see a search deal worked out with Microsoft.

Yahoo has been under great financial pressure lately. In addition to Yang's resignation, there has been a parade of executives abandoning the troubled search company.

After reporting a 64 percent drop in net income and warning that the advertising market is softening, Yahoo announced in October a layoff of at least 1,430 by the end of 2008. The cut follows another in which about 1,000 Yahoo employees lost their jobs in February.

Google headquarters in Mountain View, Calif.

(Credit: Stephen Shankland/CNET News)

The Wall Street Journal has artfully assembled a collection mostly public indicators that Google is trying to rein in its expenses, but there are a few nuggets of note about the near-mythic company coming down to earth.

The known factors include shutting down Lively and SearchMash, paring back the 10,000 contractor employees, dropping Google Page Creator in favor of Google Sites, shutting some regional offices, showing ads on Google Finance, and curtailing lavish perks such as abundant food. The more telling items in the piece, though, are that Google is requiring research projects be financially justified, expanding data centers more slowly, tying hiring to revenue, and seeking to diversify its revenue beyond search ads.

Programmers doubtless appreciate free food, but the more serious issue for a relatively engineer-centric outfit such as Google is the freedom to pursue in-house projects while on the clock--Google's famed 20 percent time. There's no indication that's falling by the wayside, but in practice, revenue-generating projects are getting the resources.

"To better manage projects in development, top executives asked engineering vice presidents to rank the 20 most promising projects within their units; those that made the lists were granted the bulk of the resources, say former Google product managers. Projects not on the lists were far less likely than before to get technical support," according to the report.

So perhaps some programmers will look for greener pastures. But with an ugly recession on, Google no doubt still looks to be a secure place to work for somebody seeking a technophiliac culture.

The Netflix Player by Roku

(Credit: CNET Networks)

Some Apple TV owners have complained for several weeks that it takes much longer now to download and playback high-definition movies.

"I started downloading an hour back and it says it will take two hours," wrote someone with the user name Reachg. "It's already 25 percent downloaded but it's not letting me play. In the past I was able to play the movie in 10 minutes max...seems something is happening."

The complaints at Apple's forums first appeared on November 14. That was the day after Roku, maker of the Netflix Player, notified customers it had received complaints from some device owners about a marked drop-off in quality of their streaming video. The Netflix Player and Apple TV are set-top boxes that enable owners to watch Web video on TV sets.

What we have here are two set-top boxes that almost simultaneously experience dramatically reduced streaming quality in the case of the Netflix Player, and longer download times in the case of Apple TV. Coincidence?

It's possible but it's worth digging a little to see whether the two cases are connected. A Roku executive told me on Monday that the problems with the company's box occurred at about the same time Netflix was making changes to its content distribution network (CDN).

Steve Swasey, Netflix spokesman declined to comment, citing the company's policy of not discussing vendors. (Apple also declined to comment.) But sources close to Netflix said the Web's top movie-rental service uses multiple CDN companies, including Akamai and Limelight Networks.

Akamai also delivers much of Apple's video content for iTunes. Jeff Young, an Akamai spokesman, said the company's isn't to blame, at least for Netflix's problems. He acknowledged that Akamai performs some services for Netflix, but they don't include anything having to do with the company's streaming video service. Netflix's streaming service is now offered on multiple devices, including Microsoft's Xbox 360.

Young said Akamai executives had not been informed about any problems at Apple TV and were looking into the problem.

I was told by an industry source that it's easy to blame Akamai and CDNs for these kind of problems, but often the glitches are the result of a company's own servers or other back-end infrastructure. The one thing that's crystal clear is none of the companies are providing customers with much information and are very tight-lipped about what they know.

On Roku's message board, several Netflix customers ask why the company hasn't notified them that there's a problem.

Proceeds from the sale of Colbert's Christmas album on iTunes will go to the charity Feeding America, and the DVD of the special is for sale at www.colbertnation.com.

(Credit: ColbertNation)

Comedian Stephen Colbert has an army and I'm in it. Together, we got a bridge in Hungary named after him (though to be honest, I didn't actually vote; I helped my team in spirit from the comfort of my couch). Colbert had an eagle named after him. He's helped countless candidates for office with his undeniable "Colbert Bump." He even got Apple to send him an iPhone simply by holding out his hand to the camera screen day after day and saying, "I want."

But now Colbert wants something else, and as a die-hard fan I am worried he might not get it. How would our beloved leader handle defeat? I'm not sure.

If you caught his show on Monday or Tuesday you know he is asking for the Colbert Nation to go on iTunes today at exactly 5 p.m. EST to purchase his album, A Colbert Christmas: The Greatest Gift of All. Currently, Kanye West has the No. 1 album on iTunes and Colbert is peeved. (His is No. 15.) Thus, he wants us all, at one moment, to collectively catapult his album to the top. It's not to help Colbert, he insists, but to humble Kanye.

He said, "I want boots on the ground, and do your Twitter blogging to each other and get it all together--whatever you kids do. It's important."

Now, here's the thing: I adore this man, but I also watched his Christmas special, and as much as I love Fountains of Wayne (bassist Adam Schlesinger composed the songs for the show), I found it rather, well, OK. Jon Stewart's song was hilarious, but the rest? Maybe not worth staying up for, especially not a whole month before Christmas.

So, as much as I want to do my part, I'm really not sure I can throw down any money to buy this DRM-laden album I'm sure I'll never play. I mean, we're in a recession--we're lucky to have the stolen music we already downloaded.

My question to you is: Are you going to log on to iTunes today to help Colbert catapult his album to No. 1? Or are you, like me, just going to hope it happens without you actually having to purchase, yes, a Christmas album on which Willie Nelson sings to the baby Jesus about the joys of weed?

(Credit: CNET)

On Tuesday, the first promotional codes that will make iPhone apps free to some users began trickling out of the App Store.

Apple is finally bequeathing apps developers with a way to let some media testers review an app at no expense and reward or attract a few lucky users. (The first invite has already floated into my in-box.)

This is Apple, so there are limits. Fifty promotional codes per product, to be exact.

Also, as wonderful as it is to see the passcodes allowed and implemented, they are not free trials. Developers angling to hook new customers will still need to lure them with free, light versions of the software or the less popular approach of offering an app free for a limited time and then ratcheting up the cost when the window closes.

Still, we're happy to finally see some leeway for developers, who will also get a reprieve from issuing gift certificates that often lose them money as a workaround for letting select reviewers evaluate apps for free.

(Via MacRumors)

Mike Horowitz, product manager for Google's Picasa software for managing photos and the Web site for sharing them, has left the company for Fetch Technologies.

"Mike was a valued member of the Picasa team and Google, and we wish him well in his new endeavors. We have a talented team working on Picasa, and we're excited about the future," Google said in a statement. The company didn't say who would replace Horowitz.

According to Horowitz's LinkedIn profile, he began his new role in December as chief product officer at Fetch, an El Segundo, Calif.-based company founded in 1999. The company sells an artificial intelligence product called Fetch Agent Platform "for extracting and integrating information from multiple Web sources, and transforming the data into a form that is useful for business applications," according to the company.

Horowitz has held a variety of high-profile positions at Google, including the product manager for Google Apps and for AdSense. He also launched AdSense for Domains and Google's personalized start page.

In September, Google launched Picasa 3 with a variety of photo-editing features, including better retouching and the ability to make slide-show videos and big collages. On the Web end, the new service groups similar-looking people to make them easier to identify. And the software and Web site can stay synchronized so editing changes on a person's computer are mirrored on the Web site.

(Via The Inquisitr.)

MySpace is going mobile with streaming video.

News Corp.'s social-networking site is expected to offer video clips from members' pages, as well as professionally produced ones, to video-enabled mobile devices starting Wednesday, according to a Reuters report. Professional video will be provided by the likes of celebrity gossip site TMZ, the National Hockey League, and National Geographic magazine.

The service will be free to users--supported by advertising. The move, which will make MySpace the first social network to offer mobile streaming video, is an attempt to tap into the small but growing mobile advertising market.

"These are the big guys doing it, and they're going to make some noise about it," David Card, a media analyst at Forrester Research, told Reuters.

The service will be available on devices such as the BlackBerry Bold, Palm Centro, Motorola Q9, LG Voyager, Nokia N95 and Samsung Instinct. But because the service will stream videos rather than download them, it will be incompatible with Apple's iPhone.

MySpace is working with video-transcoding company RipCode to make video available on a variety of different devices with different specifications on how they handle video streaming.

Conde Nast is throwing in the towel on Flip.com.

The teen girl social-networking site, which launched in February 2007, will shut down on December 16, according to an e-mail sent to users Tuesday. Members who used the service to create scrapbooks were advised: "any flipbooks that you would like to save before this date, we suggest you print them," according to MediaBistro.

Flip.com, which reached a membership of about 300,000, originally focused on shared "flipbooks" that members could create using photos, videos, and other content. However, the site had difficulty competing with the likes of MySpace and Facebook, and morphed in January into a set of distributed Web apps designed for existing social networks' developer platforms.

According to MediaWeek, Conde Nast is also closing the message board YM.com, which is what remained of the one-time YM teen girl magazine.

"The idea is that we're encouraging people to go to TeenVogue.com," a representative of Conde Nast's CondeNet told MediaWeek.

SAN FRANCISCO--A federal judge on Tuesday heard arguments in a case that centers on an important constitutional principle: can the Feds immunize any telecommunications company that violated the law by opening its network to government snoops?

That was the question debated in the courtroom of U.S. District Judge Vaughn Walker on Tuesday. Lawyers with the U.S. Justice Department, who sought to persuade Walker to throw out lawsuits pending against the telecommunications companies, told him the government engages in a variety of activities designed to "protect the heartland." Those in the Bush administration have said the lawsuits could expose state secrets, but the administration has never confirmed that it enlisted the help of any phone companies to conduct domestic surveillance operations.

Nonetheless, last summer Congress passed the FISA Amendments Act (FAA), a law that gives the U.S. attorney general the power to immunize telecom companies from lawsuits that accuse them of conducting unlawful spying at the bequest of the U.S. government.

Deputy Assistant Attorney General Carl Nichols told Walker that the proper decision was to toss out the lawsuits and not second guess the Bush administration.

Nonsense, said Cindy Cohn, an attorney with the Electronic Frontier Foundation, a group that advocates for the rights of Internet users. EFF has brought a class-action lawsuit against AT&T on behalf of customers and accuses AT&T of turning over communication records to the National Security Agency. On Tuesday, Cohn and the EFF asked Walker to throw out the federal statute and to tell Congress to start over.

Trying to get a district judge to buck the president and Congress is no easy feat, but EFF's three main legal arguments went like this:

•  Congress can't remove constitutional rights with a law. That is a cornerstone of a constitutional system like ours, Cohn said.

•  Unlike what has been publicized, the FAA statute doesn't grant immunity to phone companies. It gives the U.S. attorney general the right to dispense immunities to phone companies. "Congress is supposed to make laws, not write laws that hand lawmaking powers to the president," Cohn said following the hearing.

•  EFF also argued that there is too much secrecy involved in the process of reviewing the government's surveillance operations. Judge's like Walker could only review evidence supplied by the attorney general and that says EFF erodes the public's right to due process.

The immunity law was highly controversial in Congress, with some critics calling it a pardon for Bush. Cohn said the statute was an attempt by the Bush administration to cover up illegal acts.

"You don't need immunity if you haven't done anything wrong," said Cohn who has long accused the federal government of using AT&T's facility in San Francisco to house surveillance operations. "This isn't one little wiretap that went astray. They built a structure on Folsom Street that's permanent. That's not just a little foot fault over the constitution or the law. That is willful disregard and I think that the immunity law is their attempt to go back over and get Congress to paper it over for them."

At the beginning of the hearing, Walker started off by asking Justice Department attorneys why he shouldn't wait to see how President-elect Barack Obama's incoming administration plans to deal with the question.

"It would be very unlikely for any future Department of Justice to decline to defend the constitutionality of the statute," Nichols told Walker.

Walker didn't indicate when he might issue a decision.

CNET News' Declan McCullagh contributed to this report.

A Dr Pepper promotion revolving around Guns N' Roses' new album has gone flat--and the band is getting the misdirected static.

The soda pop maker launched a marketing campaign in March that promised a free soda to "everyone in America" if the rock band released its long-awaited Chinese Democracy album this year. After a 17-year wait, the band finally released the album--and Dr Pepper gave fans 24 hours to go to its Web site to print a coupon for their free soda.

But apparently fans' thirst was greater than Dr Pepper predicted--or prepared for. The crush of visitors to the site crashed the site's servers, leading to a lot of angry fans, some of whom mistakenly blamed the band for their lack of liquid refreshment. Now frontman Axl Rose and his bandmates are ready to pop.

"When you go on the blogs and you read the responses from the fans, they associated Axl with this promotion...and blame him for the fact that they didn't get their free soda," Laurie Soriano, the band's lawyer, told CNN. "We've gone public with the fact that we are not involved but are trying to clean up the mess."

Dr Pepper told CNN that it had "taken great steps" to keep its part of the deal and that it had extended the window for the giveaway from 24 to 42 hours. The drink maker also set up a toll-free line to handle consumer requests for the coupons. All of those measures have since expired.

Despite those measures, the band is still waiting for its apology.

"The door to a lawsuit being filed is always open until the fans are taken care of and Dr Pepper has done the right thing," Soriano told CNN.