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LOS ANGELES - Hollywood producers on Tuesday temporarily broke off contract talks with the Screen Actors Guild, calling its demands regarding DVD sales and online content “unreasonable.”

“With SAG’s continued adherence to unreasonable demands in both new and traditional media, continuing negotiations at this time does not make sense,” the producers said in a statement.

The guild responded in a statement by saying the producers’ decision to end talks after 18 days was unfortunate.

Both sides have said they sought to avoid a repeat of the 100-day writers strike that ended in February. The union’s contract for films and prime-time TV shows expires June 30.

“We made significant moves in their direction,” Doug Allen, the guild’s executive director, told The Associated Press. “We’re trying to get the deal done and we’re not the ones who walked away.”

Allen said the guild asked for a third extension of talks that were originally set to end a week after beginning April 15, but the producers refused, instead offering to resume talks May 28. No date has been agreed upon.

On Wednesday, the smaller actors union, the American Federation of Television and Radio Artists, takes its turn at the bargaining table, and it is expected to reach a deal quickly. Its contract also ends June 30.

The producers in their statement urged the guild to “recognize the fundamental business and labor principles” that were agreed upon in deals made earlier this year with writers and directors.

Walt Disney Co. Chief Executive Robert Iger said in a conference call with financial analysts that the producers had made their position clear.

“The fact that we did deals with the writers and the directors should certainly signal our position on the critical issues,” Iger said. “I think SAG is well aware of that.”

Last week, the producers had accused the guild of holding up talks by asking for a doubling of fees for DVD sales amounting to $500 million over three years.

The guild later reduced that demand to what amounted to a 15 percent increase in the form of studio payments for health insurance and pensions, a request the producers have opposed.

Allen said the guild had accepted much of the framework established by writers and directors for content distributed online, but with two major exceptions.

It sought the actors’ right of refusal on the use of their appearances in clips on the Internet, and it asked producers to mandate exclusive guild coverage for original low-budget, made-for-Internet-only shows.

The producers agreed in previous deals that union contracts were optional for writers or directors for productions that cost less than $15,000 a minute.

“They refused to consider any substantive change from their new media proposal,” Allen said. “They weren’t really negotiating about that, they were dictating.”

AFTRA said Tuesday it will impose a press blackout on details of its upcoming discussions, which involve actors on prime-time TV shows such as “Curb Your Enthusiasm,” “Rules of Engagement,” “Cashmere Mafia” and “Til Death.”

A week ago, it said 93 percent of members who voted backed a separate deal with producers covering shows such as “Oprah” and “American Idol.”

SAG and AFTRA had negotiated together on the theatrical movie and prime-time TV contract with studios for the past 27 years but split in March when AFTRA accused SAG of trying to entice actors in the soap drama “The Bold and The Beautiful” to abandon the federation.

The Screen Actors Guild has 120,000 members, while AFTRA represents about 70,000 people. The two unions share 44,000 dual members.

If AFTRA cuts a quick deal, a continuing stalemate with SAG could leave the guild with a difficult choice between pushing for a strike that has little support among its members or attempting to wring concessions from producers in other areas.

Allen said the guild could still seek a strike authorization vote if negotiations bogged down.

“We’ll see how events play out,” he said.

HAVANA (AFP) - Cuban authorities have refused to give a travel visa to a Cuban blogger who was to have flown to Spain to receive a top journalism award, the writer told AFP Tuesday.

“I have canceled tonight's flight” to Madrid, writer Yoani Sanchez, 32, told AFP, after learning that she would not be given authorization to make the trip.

“It's another way to remind us that we are like little children who need to get our parents' permission to leave the house,” she said.

The blogger now apparently will not be able to personally receive the prestigious Ortega y Gasset prize given out each year by the Spanish newspaper El Pais, which she was to have been given Wednesday.

Last month, El Pais announced it had awarded the prize to Sanchez, whose blog “Generacion Y” chronicles everyday Cubans' daily woes.

An El Pais official in Madrid told AFP that the island's communist government had been “complicating” Sanchez's exit.

Sanchez has said her request for a travel visa is the “perfect test” to see if Cuba's new President Raul Castro, who succeeded his ailing brother Fidel Castro in February, is serious about opening up the regime.

El Pais praised Sanchez's “vivacious” writing style and “shrewdness” in overcoming hurdles to freedom of expression in Cuba when it announced her prize.

The blog, hosted on a server in Germany, is Cuba's most popular, receiving 1.2 million hits a month.

Since becoming president, Raul Castro has taken modest steps to improve living standards, including allowing Cubans to stay in tourist hotels, take out mobile phone contracts, and buy appliances such as computers, motorbikes and pressure cookers.

NEW YORK (Reuters) - Sprint Nextel Corp (S.N) and Clearwire Corp (CLWR.O) are near announcing a $12 billion joint venture with major cable operators to offer services based on WiMax, an emerging technology that could make wireless Internet ubiquitous, people close to the talks said on Tuesday.

WiMax is expected to blanket entire cities with Web access for mobile devices at speeds up to five times faster than traditional wireless networks, but it is a largely unproven technology.

Shares in regular and afterhours trading rose a total 10 percent for Sprint and as much as 23 percent for Clearwire, after sources said the long-awaited deal may be announced as soon as Wednesday morning or afternoon after market close.

“The deal is essentially done in principle,” said one source.

Sprint and Clearwire, which both have said they were looking for outside funding for their WiMax plans, will each contribute airwaves and network equipment that they have allocated for a network that they plan to build based on WiMax.

The top two U.S. cable operators Comcast Corp (CMCSA.O) and Time Warner Cable Inc (TWC.N) will invest $1.5 billion between them, according to people familiar with the discussions.

Comcast will contribute $1.05 billion, while Time Warner Cable will invest $550 million. Both are looking to compete better with rivals such as AT&T Inc (T.N) and Verizon Wireless.

In addition, Intel Corp (INTC.O) is expected to contribute $1 billion, and Google Inc (GOOG.O) $500 million. Bright House Networks, the sixth-largest U.S. cable provider, has also been involved in the discussions, according to the sources, and will contribute $100 million.

SPRINT PLANS

Sprint, which has been bleeding customers from its existing service, had been criticized for plans to spend $5 billion by 2010 on WiMax.

The No. 3 U.S. mobile service provider has also attracted interest from potential suitors including Deutsche Telekom (DTEGn.DE), according to reports. A merger of the German operator's U.S. arm T-Mobile USA and Sprint Nextel could create the No 1 U.S. mobile service.

Sprint also may consider selling its Nextel unit, which it bought for $35 billion in 2005, potentially to private equity investors, according to a report in the Wall Street Journal.

But while there is private equity interest in the company, the “odds of a stand-alone” deal are very low,” according to a source familiar with the situation. A private equity firm would likely have to partner with a strategic bidder such as another telecom or cable operator, the person said.

WIMAX VALUE

WiMax is expected to support a range of applications including mobile video and to be embedded in a consumer electronics devices ranging from media players and cameras to laptop computers and communications devices.

Jonathan Chaplin, an analyst at JPMorgan, said the venture was good news for the wireless companies, which will be able to offer wider coverage than they would have alone by combining their spectrum holdings.

The cable companies pulled out of a previous wireless phone joint venture with Sprint last month called Pivot.

One of the attractions of the new joint venture for the cable companies is that they have complete control over when and how it rolls out any new wireless products and services, according to people familiar with the plans.

In the failed Pivot joint venture the cable companies had been dependent on each other to roll out new services. Cable companies said the Pivot venture involved too many “operational complexities.”

Comcast Chief Executive Brian Roberts told analysts on its earnings call last week the company does not have a competitive disadvantage to its rivals by not having a cell phone service.

He said Comcast's wireless focus is to be in a position that it could potentially extend its current services beyond cable outside consumers homes if it chooses to.

A WiMax 4G network offers the potential of carrying data such as video and games wirelessly.

Intel is expected to benefit from the joint venture by making chips for WiMax-compatible wireless devices and laptops while Google is likely to explore mobile web advertising opportunities when the service launches.

Sprint, Comcast and Time Warner Cable declined to comment. Clearwire was not immediately available. The Wall Street Journal first reported the news on its website on Tuesday.

Google had no comment. Bright House and Intel were not immediately available for comment.

(Reporting by Robert MacMillan, Yinka Adegoke, Sinead Carew and Megan Davies; editing by Richard Chang and Carol Bishopric)

IT managers often assume that open source software is more secure than proprietary commercial software. Anyone who uses open source can examine the original code to spot any lurking vulnerabilities, and potentially even fix the vulnerabilities themselves. With proprietary software, you have to trust the vendor to do it all for you.

But open source's supposed security advantage assumes three things: 1.) Someone is actually looking at the code; 2.) Security vulnerabilities are getting reported and fixed; and 3.) Information about those fixes makes its way to Linux distributors and other software vendors, who apply the fixes to their products. But what those things aren't happening? As a customer, how can you be sure?

A new initiative aims to help. Founded in March, oCERT is a Computer Security Response Team created specifically to act as a clearinghouse for security information about all kinds of open source software.

Say you're a small open source project– maybe you only provide a library of code that's used in other, larger applications. As a two-person effort, you don't have time to contact everyone who uses your code to let them know about a recent security flaw. That's where oCERT can step in to make the news known. Similarly, large Linux distributions, which incorporate hundreds or even thousands of different open source projects' code, can work with oCERT to make sure all the holes get plugged in all the right places.

Open source users can help the oCERT effort, too, by reporting security incidents. If you're a business that is experiencing a potential software exploit, oCERT can offer reliable security contacts in the open source community that can help you plan and coordinate your response.

In keeping with open source tradition (and open source budgets), oCERT is a volunteer effort, and it provides its services free of charge. The team's operating costs are underwritten by corporate sponsors– most recently Google, which posted a detailed summary of why this effort is so important to a blog Monday.

All in all, oCERT sounds like a worthwhile project that will provide a valuable service to the community of open source vendors and customers. Let's hope it wins enough support to sustain itself for the long run. (That name might be a problem, for starters– CERT is a trademark of Carnegie Mellon University.)

Are you satisfied with the current state of security and vulnerability reporting for open source software? What about the proprietary applications you use? Sound off in the PC World Community Forums.

It is unlikely that SAP will offer full-blown, on-demand versions of its Business One or All-in-One enterprise resource planning (ERP) products in the future as a follow-up to its hosted offering, Business ByDesign, according to co-CEO Henning Kagermann.

“There is no reason to do it,” he said during a press conference Tuesday at SAP's SAPPHIRE conference in Orlando, Florida.

He pointed to other ways SAP is meeting customer deployment needs. SAP recently launched a Fast Start rapid implementation program for Business All-in-One. Also this week, SAP announced partnerships with HP and IBM around hardware-software packages incorporating the product.

Business One is on-premise software aimed at companies with fewer than 100 workers. All-in-One, also on-premise software, provides greater functionality and customizability, and is meant for companies with 100-2,500 employees. Meanwhile, Business ByDesign is a hosted service geared for the middle of the SME space, or enterprises with 100-500 workers, according to SAP.

In a subsequent interview, Kagermann elaborated on the topic a bit, saying the company may make incremental moves in the SaaS direction with other SME products.

“I guess we can, over time, offer some of the services to run and to support the application which we developed remotely for ByDesign for use in All-in-One,” he said. “It might not be a complete software-as-a-service, but some pieces could be done by SAP remotely.”

One observer said SAP may not be pursuing the most effective strategy.

“Obviously, SAP's worried about possible cannibalization of its Business All-in-One and Business One customer bases by Business ByDesign– one way to potentially guard against that happening could be to offer SaaS versions of those ERP, CRM suites,” said China Martens, an analyst with the 451 Group, via e-mail Tuesday.

“Should SAP change its mind and offer SaaS versions of either Business One or Business All-in-One, we'd expect those to first appear in India and/or China,” she added.

Meanwhile, SAP said last week that it has scaled back its ambition to reach US$1 billion in revenue and 10,000 customers for Business ByDesign by 2010. The company will take a year to 18 months longer to reach those goals while it fine-tunes the product to make sure it will turn enough of a profit, SAP said.

Adware pushers have found a new way to trick you into downloading their annoying products: fake MP3 files.

On Tuesday, security vendor McAfee reported that it's seen a huge spike in fake MP3 files spreading on peer-to-peer networks. Although the files have names that make them look like audio recordings, they're really Trojan horse programs that try to install a shoddy media player and adware on your computer, said Craig Schmugar, a researcher with McAfee.

“Once you run it, there is no content. You're taken to this site to install this player which you don't really need,” he said.

Fake file names include: preview-t-3545425-changing times earth wind.mp3 and t-3545425-just got lucky.mp3. Schmugar listed more filenames, as well as details on the adware, in a Tuesday blog posting.

Users are first asked to OK an end-user license agreement before the Trojan installs two programs, Mirar and NetNucleus, on their PCs.

Ironically, while the Mirar software tells users that it doesn't display popups, NetNucleus does deliver popup ads, so users who do not realize that they are installing two programs might feel tricked, Schmugar said. “You have a Window telling you that there are no popups and right behind it is a popup.”

Although McAfee has seen some nasty software disguising itself as media files in the past, it has never seen anything on this scale, Schmugar said. Over the past 24 hours, nearly a third of the McAfee customers who reported data back to the security company have detected these files, he said.

In the past few days McAfee has spotted the files on more than 360,000 users' desktops.

SAN JOSE, Calif. - Universal Music Group confirmed Tuesday that it has reached a deal with file-sharing site Qtrax to allow free, legal downloads of UMG music.

Qtrax announced in January that it had the backing of”all the major labels” to distribute music free online, generating revenue with ads. But New York-based Warner Music Group Corp., said it had not authorized the use of its content on Qtrax’s service. UMG and EMI Group PLC also said at the time they did not have licensing deals in place with Qtrax.

UMG spokesman Peter Lofrumento confirmed Tuesday that an agreement has been reached but declined to elaborate or to say whether a contract has been signed.

“All of UMG’s music available digitally will be available for free, legal downloads on Qtrax,” Qtrax spokeswoman Shamin Abas told The Associated Press.

A joint UMG-Qtrax statement said UMG and its artists and songwriters will be compensated for the use of their content.

Abas said users “will be able to purchase music-related items” on the site.

Qtrax first launched in 2002 but shut down after a few months to avoid potential legal trouble.

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Ofcom’s William Webb and Imperial College’s Louis Atallah demonstrate health defect detection devices.

More radio spectrum will need to be released to cater for breakthroughs in healthcare and transport, said Ofcom.

In a report focused on the future use of wireless, the regulator identified hundreds of new applications.

They include wireless devices which monitor health and radio frequency ID tags on food products that allow allergy sufferers to shop more safely.

Meanwhile sensors in cars could automatically inform emergency services in the event of a crash.

The report, entitled Tomorrow’s Wireless World, was designed to give the regulator an insight into how wireless technologies will need to be regulated over the next 20 years.

It focused specifically on the health and transport sectors and both the relevant government departments were closely involved in the research.

While new spectrum will need to be released, Ofcom found that most of the applications it identified would rely on existing technologies such as wi-fi and mobile networks. “We don’t expect to see any new or completely different technology in the next 10 years,” said Professor William Webb, Ofcom’s head of research and development.

“Instead, existing technologies will be brought together to have real benefit to society. It will mean there is a need for more radio spectrum for healthcare and transport,” he said.

There is already spectrum available for wi-fi and RFID (radio frequency identification) but the allocation may need to be increased as more services come online.

The EU is currently considering ring-fencing spectrum that could be used for intelligent road transport systems.

Ear tag

In the healthcare sector, Ofcom sees wireless sensors becoming ubiquitous in monitoring a range of conditions including diabetes, heart conditions and asthma.

Such sensors, either implanted in the body or worn, would be able to send medical information to home hubs or mobile phones via short-range wireless technologies such as Bluetooth.

A number of UK universities are researching such body sensors.

Imperial College in London is running five different clinical trials of its e-AR (ear-worn Activity Recognition) sensor and predicts widespread availability within six to nine months.

“Our motion sensors work in a similar way to the Wii and can measure the body’s day-to-day activities,” explained Professor Guang-Zhang Yang, research director of medical imaging and robotics at Imperial.

“The uptake of telemedicine so far has been limited but the aim is for it to disappear into the fabric of life. It is not only for those with a disease but can also be used for general wellbeing or to promote healthy lifestyles,” he said.

Emergency alerts

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GM engineer Chris Kellum goes behind the wheel of the car that talks to other vehicles. First published on 6 July 2007.

Ofcom’s report also looked at transport and ways in which new technologies can make travel faster, smarter and safer in the future.

Cars will increasingly “talk” to each other, with alerts or even automatic systems, warning cars to brake to avoid collisions.

Such systems could be fitted to vehicles by 2015, the regulator predicted.

It could see car manufacturers held responsible for accidents, thinks Prof Webb.

“There are issues around liability which could cause some hiccups in future. There will be test cases where manufacturers are held responsible,” he said.

Other systems will provide congestion alerts and offer alternative routes to drivers.

The European Commission is currently discussing whether to mandate a system that uses wireless technology in cars to automatically alert the emergency services of an accident.

Ofcom predicts such in-car technology will be on the market by 2011.

“Such systems will typically save 10 minutes which should mean fewer deaths,” said Prof Webb.

PHILADELPHIA - Sprint Nextel Corp. is close to finalizing a deal to get financing for its new wireless broadband network from a group that includes Comcast Corp. and Google Inc., according to a person close to the talks.

The group, which also includes Time Warner Cable Inc., Bright House Networks, Intel Corp., and Clearwire Corp., is expected to announce as early as Wednesday morning a $12 billion deal to create a national network that uses the WiMax technology, said the person, who asked not to be named because public release of details hasn’t been authorized.

Sprint will merge its WiMax division, worth billions of dollars, with Clearwire, which has been building its own WiMax network. Sprint will be the majority owner of the new company, to be called Clearwire.

WiMax promises faster download speeds than the latest networks run by cell-phone operators, and it’s even seen as a potential competitor to fixed-line broadband like DSL.

Sprint and Clearwire, a startup founded by cellular pioneer Craig McCaw, have already announced their plans to build out a network using WiMax technology, but had been looking for outside funding.

The combined venture will get more than $3 billion in funding, the person said.

Philadelphia-based Comcast will contribute slightly more than $1 billion, Intel is putting in $1 billion, Time Warner Cable of New York will contribute $550 million, Google is contributing $500 million and Bright House’s part is $100 million.

Details about the the deal were reported by The Wall Street Journal on its Web site Tuesday.

The venture will give the cable companies the option to provide wireless service by buying wholesale access to the WiMax network and then reselling it. The big cable companies have already called off a disappointing run with cell phone service in conjunction with Sprint.

Rivals such as AT&T Inc. and Verizon Wireless have eschewed WiMax, opting instead for upgrades to their current wireless broadband networks and a future technology called Long Term Evolution.

Intel has been heavily involved in developing WiMax and will be making WiMax chips for computers, set-top boxes and cell phones. Google will provide its search function.

Unlike the cable companies’ previous wireless deal with Sprint, which led to co-branded cell phones in a plan called “Pivot,” the WiMax collaboration will give cable control over marketing and operations. This control was missing in Pivot, which cable companies said helped hasten its demise.

Sprint’s adoption of WiMax was championed by former Chief Executive Gary Forsee. His departure, and Sprint’s poor financial performance, spurred the need to find investors. The cost of its WiMax buildout was estimated at more than $5 billion over the next several years, said Phil Redman, research vice president at Gartner Inc.

Clearwire Corp. already provides wireless Internet service in some parts of the country, using a WiMax-like technology.

SAN FRANCISCO - After fending off months of threats by Microsoft Corp., Yahoo Inc.’s directors still will have to fight for their jobs as the company’s own irate shareholders plot a mutiny.

Spurred by widespread criticism about how Yahoo’s board responded to Microsoft’s sweetened takeover offer of $47.5 billion, an activist shareholder is trying to recruit an alternate slate of directors to present at Yahoo’s annual meeting on July 3.

“We are hoping to turn that (meeting) into ‘Independence Day’ for Yahoo’s shareholders,” said Eric Jackson, president of Ironfire Capital.

Yahoo announced in March it was postponing the annual meeting, hoping to squelch Microsoft’s threatened attempt to remove the board if the software maker decided to pursue a hostile buyout of the embattled Internet pioneer.

The specter of a hostile takeover evaporated over the weekend when Microsoft Chief ExecutiveSteve Ballmer withdrew a 3-month-old offer after concluding he had reached an impasse with Yahoo’s board over a mutually acceptable sales price.

Ballmer had orally offered to pay $33 per share, or $47.5 billion, up from an initial bid valued at $44.6 billion, or $31 per share. At the time the negotiations collapsed, the value of Microsoft’s original offer had fallen to $42.3 billion, or $29.40 per share, because half the deal was supposed to be financed with Microsoft’s declining stock.

Yahoo’s board wanted $37 per share — a price that the company’s stock hasn’t reached in more than two years.

“It’s hard to believe the board could let this happen,” Jackson said. “I think they completely misconstrued the situation and thought, ‘Microsoft is rich, so let’s soak them.’ They were bluffing all the way and got caught.”

Yahoo declined comment Tuesday. Yahoo Chairman Roy Bostock and Chief Executive Jerry Yang — a board member — have staunchly defended their handling of the Microsoft negotiations. Both have said the board wasn’t drawing a line in the sand with the $37-per-share demand.

“We engaged with them and we wanted to find a way to get something done. But they walked,” Yang said in an interview Monday.

Investors are apparently still holding out hope that Yang and Ballmer can set aside their differences and perhaps renew negotiations, even though Microsoft has been signaling it will explore other ways to improve its unprofitable Internet operations.

The possibility of revived talks helped lift Yahoo shares by $1.35, or 5.5 percent, to finish Tuesday at $25.72. That left Yahoo’s market value more than $10 billion below Ballmer’s last offer.

Yahoo announced the date of its annual meeting late Monday, giving Jackson until May 15 to submit an alternate slate of directors. Without providing specifics, Jackson said he has already approached several “well-known and credible” candidates well-versed in the problems facing Yahoo.

Even if he doesn’t assemble an alternate slate of candidates, Jackson vowed to spearhead a campaign urging shareholders to vote against the re-election of Yahoo’s current directors.

Any director who is opposed by more than half of Yahoo’s shareholders is supposed to submit a letter of resignation under the company’s rules. But Yahoo doesn’t necessarily have to accept the resignation.

Although he only owns 96 Yahoo shares, a sliver of the roughly 1.4 billion outstanding, Jackson has experience rallying stockholders around a common cause.

Jackson spent several months leading up to last year’s annual meeting organizing an online protest against Yahoo’s Terry Semel, the CEO at the time. The crusade culminated at the annual meeting, where Jackson confronted Semel and asked the CEO if he still had enough “fire in his belly” to do his job. Semel resigned six days later and was replaced by Yang.

Jackson’s latest revolt may find two powerful allies in Yahoo’s two largest shareholders, Capital Research Global Investors and Legg Mason, whose portfolio managers have both publicly expressed their disappointment with the Yahoo board’s demand for $37 per share.

Already, Yahoo stockholders with about 3 million shares have pledged to support Jackson’s attempt to replace the board.