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WASHINGTON (AFP) - Billionaire corporate raider Carl Icahn announced a bid Thursday to unseat the board of Yahoo and reopen merger talks with Microsoft, which Icahn said had been “completely botched” by the Internet firm.

Icahn said in an open letter to the Yahoo board that he had acquired 59 million shares of Yahoo — around four percent of its capital — and had formed a 10-person slate which will stand for election against the current board.

“It is unconscionable that you have not allowed your shareholders to choose to accept an offer that represented a 72 percent premium over Yahoo's closing price of 19.18 dollars on the day before the initial Microsoft offer,” Icahn said in the letter.

He added that he is seeking antitrust clearance to buy as much as 2.5 billion dollars' worth of Yahoo shares, which would give him seven percent of the company.

“I and many of your shareholders strongly believe that a combination between Yahoo and Microsoft would form a dynamic company and more importantly would be a force strong enough to compete with Google on the Internet.”

He added that in the past week, “a number of shareholders have asked me to lead a proxy fight to attempt to remove the current board and to establish a new board which would attempt to negotiate a successful merger with Microsoft, something that in my opinion the current board has completely botched.”

Icahn said a combination between Microsoft and Yahoo “is by far the most sensible path for both companies.”

The move means a proxy fight for control of the company at the Yahoo annual shareholder meeting July 3.

Greg Sterling, an analyst at Search Engine Land, said if Icahn succeeds, the new board would move immediately to restart talks with Microsoft.

“Assuming Microsoft were still interested it would be in an arguably stronger position than it was with (chairman) Roy Bostock, (chief executive) Jerry Yang, et al, in control of Yahoo,” Sterling said.

“That's because these new directors really want the deal and would thus have less negotiating strength, ironically. Microsoft might accordingly be able to lower the per-share bid it would be willing to pay.”

The 72-year-old Icahn, an activist shareholder who has targeted companies ranging from airline TWA to General Motors, was ranked number 46 by Forbes magazine in its list of global billionaires, with a net worth of 14 billion dollars.

Earlier this month, Microsoft yanked its proposal for Yahoo, saying the struggling Internet pioneer refused to budge despite the software giant upping its offer to nearly 50 billion dollars.

Talks aimed at resolving corporate dueling that began with Microsoft's offer on February 1 to buy Yahoo for 31 dollars per share ended with the two firms unable to close a multibillion-dollar gap in price expectations.

Microsoft's bid would have brought together the world's biggest software firm and second-largest Internet search firm in an effort to better compete with Google, which has been gobbling up an increasing share of the lucrative Web search market.

Icahn said in his letter: “It is clear to me that the board of directors of Yahoo has acted irrationally and lost the faith of shareholders and Microsoft.” Icahn said he was concerned by news that Yahoo's current management wants to pursue “strategic alternatives” and urged against any move that “might in any way impede a future Microsoft merger.”

“I sincerely hope you heed the wishes of your shareholders and move expeditiously to negotiate a merger with Microsoft, thereby making a proxy fight unnecessary,” he said in his letter.

The slate proposed by Icahn includes, in addition to himself: Lucian Bebchuk, a professor of corporate governance at Harvard Law School; Frank Biondi, a former chief executive of Viacom and current head of investment firm WaterView Advisors; and Mark Cuban, owner of the Dallas Mavericks basketball team.

Yahoo shares rose 2.25 percent to close at 27.75. Microsoft added 1.74 percent to 30.45.

Nintendo of America was hit with a judgment for $21 million in a patent-infringement case brought by a company that claims to be a small Texas game developer. A U.S. District Court jury found that Nintendo's designs for its Wii, WaveBird and GameCube controllers infringed on patents held by Anascape Ltd.

A Nintendo spokesman said the company will appeal the decision and expects the award to be “significantly” reduced, the Associated Press reported.

Anascape also sued over the motion-sensing technology that has made the Wii such a hit, enabling “active games” such as tennis and boxing, but the jury found no infringement on that technology.

The company also sued Microsoft for infringements on game-controller patents, but Redmond settled on May 1, just before trial. The terms of the settlement are confidential.

Twelve Patents Violated

The jury found that Nintendo violated 12 Anascape patents filed in 2000. The patents had names like “Remote Controller with Analog Button,” “3D Controller With Vibration,” and “Game Controller with Analog Pressure Sensor.”

Many game fans were outraged by the verdict. On GamesAreFun.com, Brandon Carlson wrote, “Patent-infringement lawsuits are commonplace in the gaming industry. When one company makes it big and hits the jackpot, there's plenty of people lined up to take a stab at making some quick settlement cash.”

Patent Troll?

Engadget writer Thomas Ricker called Anascape a “patent troll” — a company that buys up intellectual property for the sole purpose of extracting licensing fees or suing big companies. Indeed, the company does not have a Web site at Anascape.com, and a Google search of the company's name turned up only references to its suits against Nintendo and Microsoft.

Alexander Sliwinksi at the Joystiq blog chimed in: “Remember, kids, if you want to stick it to some big corporation in the future and cash in, just make patents for everything imaginable.”

Sky-high jury verdicts on infringement cases have frequently been overturned on review. In 2007, a jury awarded Alcatel-Lucent a record-breaking $1.52 billion, concluding that Microsoft had violated several patents related to the MP3 format. A federal judge overturned the verdict, finding that one of the two patents in question had not been violated. The jury's verdict was “against the clear weight of the evidence,” the judge said.

In February, another federal judge set aside a jury's $51 million verdict in the case of Medtronic Navigation v. Brainlab. The judge found that Medtronic's lawyers' litigation practices were so outrageous that he not only set aside the verdict, but also ordered Medtronic to pay the opposing counsel's fees.

But jury verdicts are sometimes left standing. In May, the U.S. Supreme Court declined to hear Toyota's appeal of a jury verdict for $4.3 million in a case that claimed the Prius violated another company's patents for hybrid drive trains.

San Francisco - VersionOne launched an agile project management platform for small teams of developers this week and is sprucing up its enterprise-level product next week.

Agile development involves short, iterative development processes rather than planning out everything well in advance. This accommodates changes in requirements.

“One of the more significant shifts right now over the last six months to a year is [agile development has moved] from an early adopter [stage] to mainstream,” VersionOne CEO Robert Holler said. Previously, agile was the domain of teams of 20 to 100 developers, but now there are organizations that have 1,000 developers using it, such as in the financial services, government, and high-technology spaces, he said.

The company's V1: Agile Team application enables small teams to plan and track agile projects, VersionOne said. Looking to entice users to try the product, the company will offer it free for a time for an unlimited number of users.

Capabilities include:

* The ability to import stories and defects from a spreadsheet and manage a consolidated product backlog. A story is defined as a feature or functionality. * Prioritizing of stories via multi-item drag-and-drop functionality. * Planning of multiple releases and sprints via a whiteboard interface. A sprint is a development iteration. * Track releases and sprints. * Generate agile metrics such as Burndown, Velocity, Estimate trends, and Cumulative Flow reports.

Many development teams rely on spreadsheets, bug trackers, e-mails, or homegrown time-tracking tools to manage agile projects, VersionOne said. V1:Agile Team is intended to provide a better alternative. VersionOne defines small teams as having anywhere from five to 15 developers, but the product can accommodate more.

V1: Agile Team is extensible via its API/SDK and open source third-party integrations. It can integrate with development tools such as Subversion, CruiseControl, Bugzilla, and FitNesse, enabling users to build a best-of-breed agile ALM platform, VersionOne said.

For users running multiple software development projects, VersionOne offers its Enterprise edition. V1: Agile Enterprise release 8.1 adds a capability called My Dashboard, providing a single source of insight into multiple projects.

Also featured is Testboard, with capabilities akin to an electronic whiteboard where test cases can be defined for various features.

Via an integration with the CruiseControl.net build integration capability, V1: Agile Enterprise provides visibility into stories and defects in each build in .Net-based development projects. The story perspective offers information on which build contains work toward completing a story and which build contains the completed story.

With defects, the build integration capability shows where a defect has been found or fixed.

Agile Team and Enterprise are both available in either hosted or behind-the-firewall editions. VersionOne anticipates that users starting with Agile Team could move to the Enterprise product.

While Agile Team is being offered for free at the moment, eventually it will be priced at $995 per year for a team of users.

The Enterprise Edition 8.1 is priced at $30 per user per month for the hosted edition and $595 per user for the in-house release based on a perpetual license.

TORONTO (Reuters) - BlackBerry maker Research In Motion Ltd (RIM.TO)(RIMM.O) plans to launch a touch-screen version of the wireless e-mail device in the third quarter as an answer to Apple Inc's (AAPL.O) iPhone, the Wall Street Journal reported on Thursday.

The device, known as the Thunder, is to be sold exclusively through Verizon Wireless in the U.S. and Vodafone PLC abroad, the Journal reported on its Web site, citing people familiar with the matter.

RIM declined to comment on the report, stating that it does not comment on rumors and speculation. Earlier this week, rumored details of a touch-screen BlackBerry surfaced on the Internet.

In February, RIM co-CEO Jim Balsillie said the company may bring out a touch-screen device if customers want it.

This week, Waterloo, Ontario-based RIM announced its BlackBerry Bold, a sleek smartphone with a keyboard aimed at its core base of business users.

Introducing a touch-screen BlackBerry would put RIM in more direct competition with Apple's popular iPhone. In the past, Balsillie has dismissed concerns that the iPhone could pose a serious competitive threat.

A touch-screen BlackBerry would also build on RIM's continuing push into the broader retail market as it seeks to diversify its client base beyond the executives, lawyers and other professionals who have been its mainstay.

RIM shares closed C$1.60 higher at C$140.99 on the Toronto Stock Exchange on Thursday. On the Nasdaq, they gained $2.15 to finish at $140.71.

($1=$1 Canadian)

(Reporting by Wojtek Dabrowski; editing by Renato Andrade)

U.S. cable broadband providers Comcast and Cox Communications are slowing BitTorrent traffic at all times of the day, not just during peak traffic, according to a new study by a German computer research group.

Comcast has insisted that it uses network management techniques to slow some peer-to-peer traffic during times of peak congestion, but the study from the Max Planck Institute for Software Systems suggests that Comcast and Cox are slowing BitTorrent traffic “independent of the time of day.”

The study, using more than 8,000 nodes worldwide to test for BitTorrent blocking, found that Comcast was interrupting at least 30 percent of BitTorrent upload attempts around the clock. At noon, Comcast was interfering with more than 80 percent of BitTorrent traffic, but it was also slowing more than 60 percent of BitTorrent traffic at other times, including midnight, 3 a.m. and 8 p.m. Eastern Time in the U.S., the time zone where Comcast is based, according to tests run by users of the institute's Glasnost network testing tool.

Cox was interfering with 100 percent of the BitTorrent traffic at 1 a.m., 4 a.m. and 5 a.m., also Eastern Time, according to the tests.

Comcast downplayed the results. P-to-p traffic makes up 50 percent to 90 percent of a network's traffic, and BitTorrent users can be on the network at any time, said Comcast spokeswoman Sena Fitzmaurice. That means network congestion from BitTorrent doesn't just happen in the middle of the day, she added.

“P-to-p traffic doesn't necessarily follow normal traffic flows,” Fitzmaurice said.

The Internet users who participated in the study may not be representative of Internet users overall, she added. The users who run the Glasnost tests may be “heavy users of p-to-p,” Fitzmaurice said.

Cox did not have an immediate comment on the study.

Comcast issued a statement repeating its earlier position that it “does not, has not, and will not block any Web sites or online applications,” including BitTorrent.

“We have acknowledged that we manage peer-to-peer traffic in a limited manner to minimize network congestion,” Comcast's statement continued. “While we believe our current network management approach was a reasonable choice, we are now working with a variety of companies including BitTorrent [to] move to a protocol-agnostic network management technique.”

Comcast announced in March that it would work with the company named BitTorrent to come up with new network management techniques.

The Max Planck Institute's study seems to confirm testimony by U.S. Federal Communications Commission ChairmanKevin Martin, who told U.S. lawmakers in April that Comcast's interference with BitTorrent traffic appeared to be widespread.

Comcast's actions, first reported by the Associated Press last October, appeared to “block uploads of a significant portion of subscribers” in that part of the network, even during times when the network wasn't congested, Martin told a Senate committee. “Based on testimony we've received thus far, this equipment was typically deployed over a wider geographic area or system, and is not even capable of knowing when an individual… segment of the network is congested.”

The study found BitTorrent interference from 11 other Internet services providers, in addition to Comcast and Cox, with seven of those in the U.S. But there was not “widespread” BitTorrent blocking at those ISPs, the study said. The tests looked at 1,224 ISPs worldwide.

Advocacy groups the Open Internet Coalition, Public Knowledge and Free Press all pointed to the study as evidence that the U.S. Congress needs to pass net neutrality legislation prohibiting broadband providers from blocking or slowing Web content.

“Consumers have no reason left to trust their cable company,” Ben Scott, policy director of Free Press, said in an e-mail. “[The] sophisticated testing shows that Comcast and Cox block BitTorrent applications at all times of the day– not just at times of peak traffic. Now is the time to send a clear signal to the market that blocking consumers' access to the lawful Internet content of their choice is out of bounds.”

LOS ANGELES - A federal grand jury on Thursday indicted a Missouri woman for her alleged role in perpetrating a hoax on the online social network MySpace against a 13-year-old neighbor girl who then committed suicide.

Lori Drew of suburban St. Louis was charged with one count of conspiracy and three counts of accessing protected computers without authorization to obtain information to inflict emotional distress on the girl.

Drew allegedly helped create a MySpace account on false premises to contact Megan Meier, who thought she was chatting with a 16-year-old boy named Josh Evans, who turned out not to exist.

Megan hanged herself at home in October 2006 after receiving cruel messages, including one stating the world would be better off without her.

Drew has denied creating the account or sending messages to Megan.

MySpace is based in Beverly Hills. The indictment noted that MySpace computer servers are located in Los Angeles County.

Due to juvenile privacy rules, the U.S. attorney’s office said, the indictment refers to the girl as M.T.M.

Each count in the indictment carries a maximum penalty of five years in prison.

Last month, an employee of Drew, 19-year-old Ashley Grills, told ABC’s “Good Morning America” she created the false MySpace profile but Drew wrote some of the messages to Megan.

Grills also claimed Drew suggested talking to Megan via the Internet to find out what Megan was saying about Drew’s daughter, who was a former friend of Megan’s.

Grills said she wrote the message to Megan about the world being a better place without her, which was supposed to end the online relationship with “Josh” because Grills felt the joke had gone too far.

“I was trying to get her angry so she would leave him alone and I could get rid of the whole MySpace,” Grills told the morning show.

Megan’s death was investigated by Missouri authorities, but no state charges were filed.

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Associated Press Writers Greg Risling in Los Angeles and Lara Jakes Jordan in Washington, D.C., contributed to this report.

A server problem at the U.S. National Security Agency has knocked the secretive intelligence agency off the Internet.

The nsa.gov Web site was unresponsive at 7 a.m. Pacific time Thursday and continued to be unavailable throughout the morning for Internet users.

The Web site was unreachable because of a problem with the NSA's DNS (Domain Name System) servers, said Danny McPherson, chief research officer with Arbor Networks. DNS servers are used to translate things like the Web addresses typed into machine-readable Internet Protocol addresses that computers use to find each other on the Internet.

The agency's two authoritative DNS servers were unreachable Thursday morning, McPherson said.

Because this DNS information is sometimes cached by Internet service providers, the NSA would still be temporarily reachable by some users, but unless the problem is fixed, NSA servers will be knocked completely off-line. That means that e-mail sent to the agency will not be delivered, and in some cases, e-mail being sent by the NSA would not get through.

“We are aware of the situation and our techs are working on it,” a NSA spokeswoman said at 9:45 a.m. PT. She declined to identify herself.

A similar DNS problem knocked Youtube.com off-line in early May.

There are three possible reasons the DNS server was knocked off-line, McPherson said. “It's either an internal routing problem of some sort on their side or they've messed up some firewall or ACL [access control list] policy,” he said. “Or they've taken their servers off-line because something happened.”

That “something else” could be a technical glitch or a hacking incident, McPherson said.

In fact, the NSA has made some basic security mistakes with its DNS servers, according to McPherson. The NSA should have hosted its two authoritative DNS servers on different machines, so that if a technical glitch knocked one of the servers off-line, the other would still be reachable. Compounding problems is the fact that the DNS servers are hosted on a machine that is also being used as a Web server for the NSA's National Computer Security Center.

“Say there was some Apache or Windows vulnerability and hackers controlled that server, they would now own the DNS server for nsa.gov,” he said. “That really surprised me. I wouldn't think that these guys would do something like that.”

The NSA is responsible for analysis of foreign communications, but it is also charged with helping protect the U.S. government against cyber attacks, so the outage is an embarrassment for the agency.

“I am certain that someone's going to send an e-mail at some point that's not going to get through,” McPherson said. “If it's related to national security and it's not getting through, then as a U.S. citizen, that concerns me.”

(Anders Lotsson with Computer Sweden contributed to this report.)

Rex Jameson bikes and swims regularly, and plays tennis and skis when time allows. But the 5-foot-11, 180-pound software engineer is lucky if he presses 200 pounds — that is, until he steps into an “exoskeleton” of aluminum and electronics that multiplies his strength and endurance as many as 20 times.

With the outfit’s claw-like metal hand extensions, he gripped a weight set’s bar at a recent demonstration and knocked off hundreds of repetitions. Once, he did 500.

“Everyone gets bored much more quickly than I get tired,” Jameson said.

Jameson — who works for robotics firm Sarcos Inc. in Salt Lake City, which is under contract with the U.S. Army — is helping assess the 150-pound suit’s viability for the soldiers of tomorrow. The suit works by sensing every movement the wearer makes and almost instantly amplifying it.

The Army believes soldiers may someday wear the suits in combat, but it’s focusing for now on applications such as loading cargo or repairing heavy equipment. Sarcos is developing the technology under a two-year contract worth up to $10 million, and the Army plans initial field tests next year.

Before the technology can become practical, the developers must overcome cost barriers and extend the suit’s battery life. Jameson was tethered to power cords during his demonstration because the current battery lasts just 30 minutes.

But the technology already offers evidence that robotics can amplify human muscle power in reality — not just in the realm of comic books and movies like the recently debuted “Iron Man,” about a wealthy weapons designer who builds a high-tech suit to battle bad guys.

“Everybody likes the idea of being a superhero, and this is all about expanding the capabilities of a human,” said Stephen Jacobsen, chief designer of the Sarcos suit.

The Army’s exoskeleton research dates to 1995, but has yet to yield practical suits. Sarcos’ technology sufficiently impressed Raytheon Co., however, that the Waltham, Mass.-based defense contractor bought Sarcos’ robotics business last November. Sarcos also has developed robotic dinosaurs for a Universal Studios’ “Jurassic Park” theme park ride.

Jack Obusek, a former colonel now with the Army’s Soldier Research Development and Engineering Center in the Boston suburb of Natick, foresees robot-suited soldiers unloading heavy ammunition boxes from helicopters, lugging hundreds of pounds of gear over rough terrain or even relying on the suit’s strength-enhancing capabilities to make repairs to tanks that break down in inconvenient locations.

Sarcos’ Jacobsen envisions factory workers someday using the technology to perform manual labor more easily, and firefighters more quickly carrying heavy gear up stairwells of burning buildings. Disabled people also may find uses for the technology, he said.

“We see the value being realized when these suits can be built in great numbers for both military and commercial uses, and they start coming down in cost to within the range of the price of a small car,” said Jacobsen. He declined to estimate how much the suit might cost in mass production.

But cost isn’t the only obstacle. For example, developers eventually hope to lengthen the suit’s backpack battery’s life and tinker with the suit’s design to use less energy. Meanwhile, the suit can draw power from a generator, a tank or helicopter. And there are gas engines that, while noisy, small enough to fit into the suit’s backpack.

“The power issue is probably the No. 1 challenge standing in the way of getting this thing in the field,” Obusek said.

But he said Sarcos appears to have overcome the key challenge of pairing super-fast microprocessors with sensors that detect movements by the body’s joints and transmit data about them to the suit’s internal computer.

Much as the brain sends signals to tendons to get muscles to move, the computer sends instructions to hydraulic valves. The valves mimic tendons by driving the suit’s mechanical limbs, replicating and amplifying the wearer’s movements almost instantly.

“With all the previous attempts at this technology, there has been a slight lag time between the intent of the human, and the actual movement of the machine,” Obusek said.

In the demonstration, the bulky suit slowed Jameson a bit, but he could move almost normally. When a soccer ball was thrown at him, he bounced it back off his helmeted head. He repeatedly struck a punching bag and, slowly but surely, he climbed stairs in the suit’s clunky aluminum boots, which made him look like a Frankenstein monster.

“It feels less agile than it is,” Jameson said. “Because of the way the control laws work, it’s ever so slightly slower than I am. And because we are so in tune with our bodies’ responses, this tiny delay initially made me tense.”

Now, he’s used to it.

“I can regain my balance naturally after stumbling — something I discovered completely by accident.”

Learning was easy, he said.

“It takes no special training, beyond learning to relax and trust the robot,” he said.

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AP Photographer Douglas C. Pizac contributed to this report from Salt Lake City.

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On the Net:

Video link to demonstration of Sarcos robotic suit: http://www.raytheon.com/newsroom/technology/rtn08_exoskeleton/

FRANKFURT, Germany - Deutsche Telekom chief executive Rene Obermann said Thursday the company has so far sold more than 100,000 of Apple Inc.’s iPhones since the device’s November debut in Germany.

At Telekom’s annual general meeting in Cologne, Obermann said the iPhone was the most popular multimedia device sold by the company’s T-Mobile cell phone division.

IPhone customers use the Internet 30 times more on average than other mobile telephone customers and that one-third of iPhone customers bought the most expensive service plans, Obermann said.

Company spokesman Alexander von Schmettow declined to specify the sales figure beyond 100,000 or forecast future sales but said the iPhone was “meeting expectations.”

Deutsche Telekom advertises 8-gigabyte iPhones for $153.45 and monthly service plans at $153.45 to $385.95 on its Web site. Deutsche Telekom is the exclusive service provider for the iPhone in Germany.

Obermann wouldn’t comment on rumors that an improved version of the iPhone would be introduced to the German market.

Deutsche Telekom shares were flat at $18.41 in Frankfurt trading Thursday.

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On the Net:

http://www.deutschetelekom.com

http://www.apple.com

ALEXANDRIA, Va. - A one-time dot-com billionaire was convicted Thursday of stock fraud and obstruction of justice after a court finding that he deceived investors in his Las Vegas software company.

Charles E. “Junior” Johnson was chief executive of PurchasePro Inc., a software company that went bankrupt as the dot-com bubble burst in 2001.

U.S. District Judge Walter Kelley found Johnson guilty on all counts after concluding he schemed to falsely inflate his company’s revenue in the first three months of 2001.

The case has been under investigation for six years and resulted in convictions of six other PurchasePro executives.

Two midlevel executives at AOL, which had a marketing partnership with PurchasePro, were acquitted at an earlier trial.

Johnson compounded his problems by trying to alter documents used at his trial, which resulted in an additional charge of obstruction of justice.

Johnson’s attorney, Yale Galanter, said he found it troubling that the judge relied in his ruling on testimony from other PurchasePro executives who had acknowledged lying to investigators.