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The creator of the web has said consumers need to be protected against systems which can track their activity on the internet.

Sir Tim Berners-Lee told BBC News he would change his internet provider if it introduced such a system.

Plans by leading internet providers to use Phorm, a company which tracks web activity to create personalised adverts, have sparked controversy.

Sir Tim said he did not want his ISP to track which websites he visited.

“I want to know if I look up a whole lot of books about some form of cancer that that’s not going to get to my insurance company and I’m going to find my insurance premium is going to go up by 5% because they’ve figured I’m looking at those books,” he said.

Sir Tim said his data and web history belonged to him.

He said: “It’s mine - you can’t have it. If you want to use it for something, then you have to negotiate with me. I have to agree, I have to understand what I’m getting in return.”

Phorm has said its system offers security benefits which will warn users about potential phishing sites - websites which attempt to con users into handing over personal data.

The advertising system created by Phorm highlights a growing trend for online advertising tools - using personal data and web habits to target advertising.

Social network Facebook was widely criticised when it attempted to introduce an ad system, called Beacon, which leveraged people’s habits on and off the site in order to provide personal ads.

‘No strings’

The company was forced to give customers a universal opt out after negative coverage in the media.

Sir Tim added: “I myself feel that it is very important that my ISP supplies internet to my house like the water company supplies water to my house. It supplies connectivity with no strings attached. My ISP doesn’t control which websites I go to, it doesn’t monitor which websites I go to.”

Talk Talk has said its customers would have to opt in to use Phorm, while the two other companies which have signed up - BT and Virgin - are still considering both opt in or opt out options.

Sir Tim said he supported an opt-in system.

“I think consumers rights in this are very important. We haven’t seen the results of these systems being used.”

Privacy campaigners have questioned the legality of ISPs intercepting their customers’ web-surfing habits.

But the Home Office in the UK has drawn up guidance which suggests the ISPs will conform with the law if customers have given consent.

Sir Tim also said the spread of social networks like Facebook and MySpace was a good example of increasing involvement in the web. But he had a warning for young people about putting personal data on these sites.

“Imagine that everything you are typing is being read by the person you are applying to for your first job. Imagine that it’s all going to be seen by your parents and your grandparents and your grandchildren as well.”

But he said he had tried out several of the sites, and thought they might in the end be even more popular with the elderly than with young people.

Sir Tim was on a short visit to Britain from his base at MIT in Boston, during which he met government ministers, academics and major corporations, to promote a new subject, Web Science.

This is a multi-disciplinary effort to study the web and try to guide its future. Sir Tim explained that there were now more web pages than there are neurons in the human brain, yet the shape and growth of the web were still not properly understood.

“We should look out for snags in the future,” he said, pointing to the way email had been swamped by spam as an example of how things could go wrong. “Things can change so fast on the internet.”

But he promised that what web scientists would produce over the coming years “will blow our minds”.

Though many tech vendors are suffering as the widening U.S. financial crisis slows down consumer and business spending, IT mergers and acquisitions including bellwethers such as Microsoft, Google, Yahoo, Electronic Arts and AOL continue to reshape the technology landscape and provide opportunities for investors.

AOL's announcement on Thursday that it will buy social-networking site Bebo for US$850 million is just the latest example that IT companies are not letting a depressed market get in the way of strategic purchases.

Economic Worries

The macroeconomic news and fresh data on IT returns this week are, as usual, not heartening. A survey released Thursday by research company ChangeWave shows that the U.S. economy is already in recession. The Feb. 27-March 5 survey of 3,345 professionals in U.S. businesses found, among other things, that 30 percent of those polled forecast first-quarter sales to come in below plan. This is 5 points worse than the company's previous poll.

“You have to go all the way back to 2002 to find a downturn of this magnitude in a ChangeWave corporate survey,” said Tobin Smith, ChangeWave founder, in an e-mail note accompanying the report. “There's no doubt anymore the recession is now here,” he said.

The general downturn is having a marked effect on many IT vendors. For example, in a software research note, Citi Investment Research on Thursday reported a marked decline. “After five years of positive full year returns, the software sector is posting negative returns so far in 2008,” wrote Brent Thill and John Reilly Walsh.

Median software company earnings are down this year by 14 percent, compared to the tech-heavy Nasdaq Composite Index's decline of 15 percent. Since October, software sector returns are down 20 percent, matching exactly the Nasdaq's fall since then.

What's an IT investor to do?

In Crisis is Opportunity

“In this uncertain environment, potential M&A targets may provide the best opportunities for appreciation,” wrote the Citi research team.

Overall tech M&A activity will likely decline this year as turmoil in financial markets dampens tech buyouts from private equity firms, which had a record for acquisitions in 2007. However, this will not necessarily deter cash-rich tech companies themselves from acquisitions. Acquisitions are a quick way to bring in new technology in fast-moving sectors like the Internet, or expand market reach in mature sectors such as enterprise software.

The most obvious example of these trends is Microsoft's bid for Yahoo, announced Feb. 1. The offer was originally valued at $44.6 billion. Since Microsoft stock is part of the deal, the total value of the deal has dropped as the software giant's share price declined after the offer was announced. Many industry insiders believe that Microsoft will find it hard to integrate the companies, which have overlapping product lines and services. However, the offer has boosted Yahoo's share price, from the $19 level at the end of January to the $28 level now. One caveat, if Yahoo successfully resists the deal: Look for its share price to fall again.

On Thursday, shares of game developer Take-Two Interactive jumped $0.73 to close at $25.64, after Electronic Arts offered shareholders a tender offer of $26 per share. EA made the offer after Take-Two's board continued to resist its entreaties. EA has been pursuing Take-Two since Feb.19, when its offer was a 64 percent premium on Take-Two's Feb.15 share price of $15.83.

Share prices of acquiring companies don't often go up on acquisition news because a big buyout can dilute earnings for a while. EA's share price has fluctuated with the market in the past few weeks, closing at $48.95 on Feb. 21, when the offer was made public, and $47.26 on Thursday.

Google Bounces Back

Google's share price has plummeted along with the market in recent weeks, but rose Tuesday by $26.22, to $439.84, after European regulators approved its purchase of DoubleClick. With DoubleClick, Google should be able to deliver more relevant advertising.

If you were not an investor in Yahoo or Take-Two (DoubleClick and Bebo were private companies), take heart, there are plenty of takeover targets out there.

Citigroup says to take a look at, among others, data-integration software vendor Informatica, trading at $17.79; middleware vendor Tibco, trading at $7.55; and data-center software provider Bladelogic, trading at $23.71. In any case, these companies are cheaper than Google, trading at $443.01 on Thursday.

Adoption of hosted applications among large companies jumped last year, but many CIOs and IT managers will not consider these software-as-a-service (SAAS) products due to concerns about security, cost and integration, according to a Forrester Research study.

In a 2007 survey of just over 1,000 IT decision makers, 16 percent said their companies were either already using or piloting SAAS products, a 33 percent increase from 2006.

Those who said they were either interested in or planning to pilot hosted applications remained the same at 46 percent, while those who aren't interested dropped from 41 percent to 37 percent, Forrester said in the report, issued Wednesday.

Respondents who are favorable to SAAS products cite shorter implementation, lower up-front costs and pay-as-you-go pricing as reasons, wrote analyst Liz Herbert, the report's author.

Interest in SAAS isn't consistent across application categories. Popular applications include those for human resources, collaboration and customer relationship management. SAAS is less used for enterprise resource planning, supply chain management and Web 2.0 tools like wikis, blogs and RSS.

Respondents who aren't considering SAAS products cited limitations in the ability for hosted applications to be integrated with software they have installed in-house and to be customized. These IT executives also believe that hosted applications that are leased and paid for under a subscription model cost more in the long run than software that is bought and installed on the company's servers. They also mentioned a variety of security concerns, including fear about having the software and data hosted in a third party's data center and concerns about application performance and availability.

BOSTON - One of the great things about the Internet is the way people post reviews on just about anything you’re considering trying, whether it’s a movie, a new restaurant or the local florist.

This also introduces one of the worst things about the Internet: trying to figure out which reviews to trust. Was that effusive praise written surreptitiously by the merchant? Was that anonymous online slam posted by a devious competitor?

The dilemma might be unavoidable in this age of abundant user-generated content, when we have to be smarter about separating signals from noise. But a startup called RatePoint Inc. begs to differ. It wants to play referee, giving consumers more clarity into a business’ reputation and protecting the business from unwarranted blights on its credibility.

Needham, Mass.-based RatePoint has built a rating system that businesses can run on their Web sites for a $149 annual subscription. Like so many other Web sites today, RatePoint’s rating engine solicits and displays reviews from customers. The unusual aspect is what happens after a review is submitted.

If it’s negative (one or two stars out of five), the reviewer is asked to provide an e-mail and a phone number so the merchant can follow up. The e-mail is verified by RatePoint’s servers, and the phone number is confirmed with a quick automated call.

The theory is that this will filter out phony complaints from rivals, who would be unlikely to reveal contact information, while assuring legitimate customers that their issues will be heard. RatePoint then forwards the negative review and contact information to the merchant, giving the business a chance to rectify the problem. A product arrived broken in the mail? Maybe the business could offer a replacement. Service was poor at dinner? Maybe the restaurant invites the complaining couple back with a coupon.

If the customer eventually agrees that the business has righted the wrong, the negative review won’t get posted. If the business can’t please the unhappy customer, the negative review sticks, for anyone else to see — although the business can post a response.

RatePoint CEO Neal Creighton argues that this approach gives businesses a better way — and a huge incentive — to listen to their customers’ online feedback. In fact, he says RatePoint is so protective of its own image as a seal of good business that it has kicked businesses out of its network for failing to try to rectify negative reviews.

Positive reviews (three, four or five stars) are vetted, too, though here the system seems less foolproof.

To screen out false praise engineered by merchants or their allies, RatePoint has algorithms that watch for suspicious e-mail addresses or usage patterns — like someone in Virginia praising a neighborhood hardware store in California.

RatePoint also lets merchants decide which positive reviews to show. This is designed to prevent people from sneaking vicious put-downs into a three-, four- or five-star review.

But that also would seem to be a strike against the independence and comprehensiveness of the RatePoint system, since merchants can cherry-pick their very best comments for display. Creighton counters that many of the 1,400 merchants using the system so far have not elected to do that, and instead show all positive comments, even mediocre ones.

Having launched its rating system last June, RatePoint has a long way to go to become a widely known seal of authenticity online, a source trusted as much as popular review sites like Yelp or Trip Advisor and comparison sites like BizRate.

However, a partnership that RatePoint is announcing Monday with VeriSign Inc., a seller of online authentication technologies, could widen RatePoint’s footprint.

Now Creighton’s goal for the next year is to sign up nearly as many merchants as the Better Business Bureau’s online division, in which more than 41,000 businesses have earned that group’s seal of Web legitimacy. The bureau doesn’t mediate online commentary, but instead affirms that a company follows standards in such areas as truthful advertising and online privacy.

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On the Net:

http://www.ratepoint.com

NEW YORK - Frank Harper is well aware that all those free video clips on the Internet come at a price: advertising.

But that doesn’t mean he sits idly as short video ads precede many of the dozen or so clips he watches each day at sites like Microsoft Corp.’s MSN.

“For the most part, I just mute the volume,” said Harper, 55, who runs a security consulting firm in Sterling, Va. “Or I just look at something else, look at another headline … or go to another site while the thing is playing.”

Marketers and Web sites alike are struggling to bring to the Internet ads that resemble television without turning off viewers the way TV ads often do.

Spending on online video ads represents less than 4 percent of all Internet advertising and just 1 percent of the amount spent on TV, according to eMarketer. But growth is expected — with the research firm forecasting U.S. spending more than tripling to $4.3 billion in 2011 — especially as more viewers embrace full-length TV episodes and other video online.

The challenge is finding the right formula — in the creative approach, the format or the frequency with which the ads appear — so visitors notice the pitches without getting so annoyed that they never come back.

“Users love free content and advertisers love to fill up every minute and pixel with the messaging, and publishers do have to find that balance,” said Geoffrey Coco, an advertising executive with Microsoft, which has a video news partnership with The Associated Press. “There’s been a lot of innovation but I don’t think we’ve settled down yet.”

The results so far have been mixed — even when sites force viewers to watch video ads by making them impossible to skip.

Viewers “are grabbing the status bar, trying to click it ahead or further along, and while they are figuring out how to skip the ad, they’ve missed the ad,” said Jonathan Sackett, chief digital officer with the Arnold Worldwide ad agency.

And some studies have shown that many viewers abandon the video completely if an ad appears. Yankee Group senior analyst Daniel Taylor said sites that insist on “no ad, no video” risk losing frustrated visitors to rivals forever — along with future ad opportunities.

Google Inc. and other search companies have generated billions of dollars from text-based ads that appeal primarily to merchants seeking a direct response, such as an immediate sale.

But for companies more interested in longer-term brand promotion, video could make a much more lasting impression.

“It’s emotive, rich. It grabs your heart,” said Suranga Chandratillake, founder of video search company Blinkx PLC. “It combines all that is great about TV advertising with all that is great with online advertising” — the ability to more accurately track who’s watching, when and for how long.

Although many advertisers are simply repurposing television ads as online “prerolls,” a few are trying to break from that mold with ads that are more interactive.

During a recent episode of “Lost” on ABC’s Web site, for instance, Taco Bell offered a virtual photo shoot with Sports Illustrated swimsuit model Daniella Sarahyba.

As viewers watch video of Sarahyba on location, they use the mouse to move around and snap up to 100 shots. Afterward, viewers can download the photos (with a Taco Bell logo in the corner), choose another locale or resume the show without missing a second.

“It becomes a lean-in experience rather than just a lean-back,” said Shawn Chapman, senior manager for brand communications at Yum Brands Inc.’s Taco Bell chain. “I think consumers give us credit for doing things a little bit differently.”

Meanwhile, Google’s YouTube and Time Warner Inc.’s AOL have introduced “overlay” ads at the bottom of selected video clips. Clicking on an overlay pauses the video and launches the full pitch, such as a preroll or movie trailer. The overlays disappear after several seconds if the viewer does nothing.

Yahoo Inc. plans a similar offering later this year. In February, it also began offering HBO, Pepto-Bismol and other brands three-second teasers that users have to click to watch the entire preroll ad. Otherwise, visitors go straight to the video.

Microsoft has been exploring overlays as well as ways to insert ads at the right time — for example, finding the 10 seconds in a video where an advertiser’s logo in a corner would interfere least with the action in the clip.

“The preroll is really a first-generation ad format,” said Fred McIntyre, AOL’s senior vice president for video. “The new formats over time are going to end up being more popular. On balance, it’s not where the market is today.”

Industry experts say alternative formats could work best with shorter clips, the ones popular on YouTube. After all, who wants to watch a 30-second ad just for a 15-second clip?

Advertisers, though, will have to figure out how to get people to click. They’d have just a few seconds instead of their usual 30-second palette to make a message engaging.

Rebecca Paoletti, director of Yahoo’s video strategy, said Web sites must embrace prerolls for now because of the disparity between television and Internet spending.

Even if the Internet manages to lure some of those television dollars away, Paoletti said she doubts advertisers will ever abandon TV completely, meaning sites must continue to offer similar formats.

Taco Bell agrees. Debbie Myers, the company’s vice president for media services, said online-only ads like the virtual photo shoot can be expensive to produce. She also said there is value in giving consumers a unified experience — the same ad — “no matter what screen they are on, whether it’s the television, cell phone or computer.”

Some preroll advocates believe the key to making prerolls work is good targeting, something sites large and small are exploring.

John Lumpkin, a vice president at Heavy Inc., said his video site has been successful at running ads for movies, video games and other entertainment of interest to its audience of younger men. The site, unlike many others, even lets viewers fast-forward commercials — the advertiser still gets charged — but Lumpkin said few viewers bother.

It ultimately comes down to viewer control and engagement through interactivity.

“We are very much at the formative stage,” said Marcien Jenckes, chief executive of video distributor Voxant Inc. “At this point, a lot of online video advertising is unsophisticated. To make sure that the television dollars turn into Internet dollars and not pennies, we need to take advantage of our medium.”

Astronauts have attached arms to the space station’s new robot, Dextre.

Richard Linnehan and Michael Foreman completed the task during a gruelling spacewalk outside the orbiting platform that lasted more than seven hours.

The robot, which is properly called the Special Purpose Dextrous Manipulator, will in future do much of the external work on the space station.

The 1.5-tonne, 4m-long machine was brought up to the platform by shuttle Endeavour on Tuesday.

It was packed in parts on a travel pallet and needs to be reassembled before it can begin work.

During the mission’s first spacewalk on Friday, Dextre’s hands were fitted to its arms. Now those arms have been attached to the robot’s torso.

Dextre will be used to install and remove small payloads such as electronics boxes, computers and batteries.

It will be controlled by astronauts from inside the platform or even by ground controllers.

Endeavour’s astronauts and the resident crew on the space station have continued to outfit the new Japanese Logistics Module which was also lofted on Tuesday.

This is a storage facility for the Japan Aerospace Exploration Agency’s (Jaxa) Kibo laboratory, the main section of which will travel to the station on the next shuttle flight.

Two-and-a-half years after eBay bought Skype, the online auction giant has moved away from trying to create new, merged capabilities through the acquisition and is letting Skype be what it is.

“There's less focus at eBay today on finding the place where eBay and Skype intersect on the Web and mash up to create a new… communication paradigm for eBay, and more focus on Skype growing its business and eBay growing its business,” said Jonathan Christensen, Skype's general manager of audio and video, at the Emerging Communications Conference (eComm) in Mountain View, California.

The deal in October 2005 disrupted the pioneering VOIP (Voice Over Internet Protocol) software company for a while, Christensen said.

“In some ways, we stalled,” he said. “There's almost always a period of integration (when) a lot of weird things are tried, and some work and some don't, and there's defocus.” Along with that, there has been a management shake-up at Skype, he added. Founder Niklas Zennstrom resigned last October. Josh Silverman, CEO of eBay's Shopping.com unit, became CEO of Skype last month.

Today, however, the relationship between eBay and Skype is going “very well,” Christensen said. “The projects that I'm leading on my team… for the next two years, three years… are groundbreaking,” he said. He declined to give details of what's coming up, but in a speech at the conference, he recounted the history of Internet voice and said the next frontier is the mobile arena.

The approximately US$2.6 billion acquisition of Skype raised eyebrows among observers who didn't see a good fit between the two companies. It was not until June 2006 that eBay launched a limited trial of Skype buttons in its marketplace. The buttons let eBay buyers and sellers launch Skype and talk or text-message before making a purchase. Beginning last October, they became available for sales of all categories of products.

Last year eBay took an impairment charge related to the Skype deal and said it was disappointed in Skype's performance in the short term regarding user activity and monetization. EBay said it still believed Skype was a very valuable asset and was interested in the potential of services such as the SkypeFind business listing feature and SkypePrime advice service.

Skype now has 276 million regular users and is profitable, Christensen said.

“That sense of innovation and hard work and startup-ness is very much alive at the company,” Christensen said.

BEIJING - China blocked access to YouTube.com on Sunday after dozens of videos of recent protests in Tibet appeared on the popular U.S. video Web site.

The blocking added to the communist government’s efforts to control what the public saw and heard about protests that erupted Friday in the Tibetan capital, Lhasa, against Chinese rule.

Access to YouTube.com, usually readily available in China, was blocked after videos appeared on the site Saturday showing foreign news reports about the Lhasa demonstrations, montages of photos, and scenes from Tibet-related protests abroad.

There were no protest scenes posted on China-based video Web sites such as 56.com, youku.com and tudou.com.

The Chinese government has not commented on its move to prevent access to YouTube. Internet users trying to call up the Web site are presented with a blank screen.

Chinese leaders encourage Internet use for education and business but use online filters to block access to material considered subversive or pornographic.

Foreign Web sites run by news organizations and human rights groups are regularly blocked if they carry sensitive information. Operators of China-based online bulletin boards are required to monitor their content and enforce censorship.

China has at least 210 million Internet users, according to the government, and is expected to overtake the United States soon to become the biggest population of Web surfers.

Beijing tightened controls on online video with rules that took effect Jan. 30 and limited video-sharing to state-owned companies.

Regulators backtracked a week later, apparently worried they might disrupt a growing industry, and said private companies that already were operating legally could continue. They said any new competitors will be bound by the more stringent restrictions.

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On the Net:

Youtube.com: http://www.youtube.com

IBM's deal for startup Encentuate should deliver two big additions to its single sign-on and authentication products, an area where IBM already is the market leader. One is customers in the sought-after health care industry; the other is greater flexibility, so employees aren't locked into using one type of token or smart card for strong authentication.

The acquisition, for an undisclosed sum, follows a string of deals by big vendors for identity management and access control startups.

Six-year-old Encentuate has 80 customers, with around half its business from health care groups dealing with U.S. HIPAA rules for information security. “Even though, in some cases, they're small hospitals, they require a certain compliance richness,” says Zorawar Biri Singh, president and CEO of Encentuate. “An ability to meet their requirements is readily exportable to other markets.”

Encentuate will be integrated with the elements of IBM's Tivoli Access Manager suite, including Identity Manager, Federated Identity Manager, Compliance Insight Manager, and Security Operations Manager. Tivoli resells single sign-on software from Passlogix, and it will offer an upgrade program to Encentuate, which has the potential to irk some current users.

Encentuate lets employees in different parts of a company be authenticated with tools they already have, such as smart cards, biometrics, tokens, and RFID badges, says Joe Anthony, program director for security and compliance management at Tivoli. That, combined with single sign-on to all the applications and data they're authorized for, is a big convenience. In the past, single sign-on “meant that everybody had to have the same second factor, like a token or a smart card,” he says. “It's just another thing to keep track of.”

IBM also will adopt Encentuate's development facilities in Singapore as a software security lab, its 59th lab. Encentuate has two-thirds of its 40 employees at the site, all devoted to R&D.

Encentuate's authentication products go beyond setting user ID and password requirements. Its Identity and Access Management and its Strong Authentication products also track user activity and can provide a context for what an employee was doing as he accessed certain data or files. That audit trail can be critical to meeting regulations. “Compliance is driving a lot of our customers' decisions,” Anthony says.

SINGLE POINT OF FAILURE?

Startups Snatched Up
MICROSOFTCredentica, March 2008

PING IDENTITYSxip Access, March 2008

SUNVaau, Nov. 2007

CISCOSecurent, Nov. 2007

ORACLEBharosa, July 2007
Single sign-on, though, can be a point of tension. Companies get queasy about letting employees access a wide range of applications and data via a single password. Single sign-on “isn't necessarily good for security, because it consolidates to a single failure point,” says Rich Mogull, founder of security consultancy Securosis.

However, many of these same companies want to reduce the number of passwords and access methods they use, both to reduce technology costs and to simplify administration. “We've seen a lot of traction there, especially when linked with broader identity management, which Tivoli tries to do,” Mogull says.

IBM is expanding its access control and identity management suite at a time when Hewlett-Packard is pulling back. HP will “focus its investment in identity management products exclusively on existing customers and not on pursuing additional customers or market share,” says Eric Vishria, VP of HP software. HP will continue to support its Identity Center products and supply consulting services.

Still, the market is fiercely competitive, with Sun Microsystems competing effectively with its Identity Manager, Access Manager, and Role Manager. Microsoft just this month acquired Credentica's U-prove identity and access management software. And open source code continues to invade the market segment. At the end of February, the Eclipse Foundation released Higgins 1.0, a free identity management framework for managing users across multiple sites and applications.

–With Tim Wilson, Dark Reading

See original article on InformationWeek.com