By Michael Santo
Editor-in-Chief, RealTechNews

Has the drama finally ended? According to a press release issued today, it seems that Yahoo! and Carl Icahn, who was seeking to replace much if not all of Yahoo!’s Board of Directors (BoD) during the upcoming August 1st shareholders meeting, have come to an agreement.

Much as with Icahn’s earlier fireworks with Motorola, he got much of what he wanted.

• The BoD will expand from 9 to 11.

• Icahn will get a seat on the BoD

• One member, Robert Kotick, will not stand for re-election, but the others, including oft-criticized (by Icahn) Jerry Yang, will.

• The remaining two seats will be filled from slate of nominees (since Jonathan Miller, former Chairman and CEO of AOL is listed in the PR, you can bet he’ll be one of them).

Much of the remaining portion of the press release falls into the category of science fiction, it seems. More

By Michael Santo
Editor-in-Chief, RealTechNews

Late Saturday, Yahoo! rebuffed another offer from Microsoft, one that would have resulted in Microsoft getting Yahoo!’s search business and Carl Icahn taking the rest. While Yahoo!’s press release was very detailed, on Monday both Carl Icahn and Microsoft felt they had to present their own take on things, including correcting what they perceived as errors.

Icahn said, in an open letter to Yahoo! shareholders:

Over the years I have attempted to make changes at many companies but I have yet to see a company distort, omit and twist events and facts in the manner that Yahoo! has done in their press release issued Saturday night, July 12th.

• Yahoo! in their Saturday night press release makes much of the fact that they were only given 24 hours to decide on the Microsoft offer because of the time constraints relating tothe proxy fight, but neglects to mention that they were offered more time if they would be willing to postpone the annual meeting for a short period.

• Yahoo! conveniently neglects in its press release to tell you about the extremely important above mentioned guarantees that Microsoft was willing to make;

• Yahoo! tells you in their press release that a condition of the deal was the immediate replacement of the current board and removal of top management. Yahoo! neglected to mention we were willing to discuss keeping a number of the current board members and Jerry Yang as Chief Yahoo!

• Yahoo tells you the Microsoft proposal precludes the potential sale of all Yahoo! however, they neglect to tell you that that train has left the station in that Microsoft is no longer willing to buy all of Yahoo! with the current board overseeing the company.

• Yahoo!’s press release states that “this odd and opportunistic alliance of Microsoft and Mr. Icahn has anything but the interest of Yahoo stockholders in mind”, raising the innuendo that I am on Microsoft’s side in this manner. That is patently ridiculous. Since Yahoo! failed to consummate a transaction with Microsoft this year, I have spent hours and hours attempting to get the parties together because I believe that it is beneficial to Yahoo! shareholders to have a deal with Microsoft and I have worked hard trying to make it happen. It is important to note that my funds and affiliates own 70 million shares of Yahoo and own no shares of Microsoft or Google while the current board outside of Jerry Yang owns only the shares they have received from Yahoo for being directors. My interests are aligned with yours and not Microsoft and I think it is in our interest to have this transaction consummated so that we can get value much in excess of the recent and current market for Yahoo! shares.

Seriously, though, tell us how you really feel.

At the same time, however, Microsoft’s press release slightly contradicts Icahn’s. Microsoft does not mention a timetable, but Icahn does, above - though he also says they (Yahoo!) could have received an extension.

Microsoft also said that the deal was actually requested by Yahoo! chairman Roy Bostock and that Microsoft had been told Yahoo might accept a deal if Microsoft raised its bid on certain terms of the agreement.

Specifically, on Thursday afternoon, July 10, Mr. Bostock called Steve Ballmer’s office to arrange a call. On that subsequent call, Mr. Bostock told Mr. Ballmer that “with substantial guarantees on the table and an increase in the TAC (traffic acquisition cost) rate, there are the pillars of a search only deal to be done.” Mr. Bostock encouraged Mr. Ballmer to submit a new proposal to Yahoo! for a search-only deal reflecting these terms.

So, what is going to happen now? Sounds like a case of he said / she said. Let me just say, that August 1 shareholders meeting ought to be a doozy!

By Michael Santo
Editor-in-Chief, RealTechNews

OMG. A non-iPhone story.

Aha, now we know why Microsoft added all that extra hard disk space: for Netflix video streaming. Not really, though, since it’s streaming video it likely isn’t going to take all that additional hard drive space.

However, the Xbox 360 is getting access to Netflix, coming in “late fall.” Yes, you’re going to have to wait until then for the necessary update to turn your Xbox 360 into the equivalent of a Roku box.

In February, there was teaser information about this sort of partnership, though it was rumored the PS3 might get such streaming capability as well. It doesn’t look like that will happen, however, as this is an “exclusive partnership.”

The system will work the same way as the Roku box does. From the Netflix Web site, members simply add movies and TV episodes to their individual instant Queues.

The press release dishes the details:

A growing library of more than 10,000 movies and TV episodes will be available from Netflix when it launches on Xbox LIVE in late fall, with more choices added over time. Through this agreement, along with the existing Xbox LIVE Marketplace Video Store, Xbox 360 will be home to more movies and TV shows on demand than any other device connected to the TV. Xbox LIVE quickly and easily connects consumers and their friends to the entertainment they want — with no PC required for viewing.

Netflix on Xbox 360 is an important component of the new Xbox experience, a new generation of games and entertainment experiences that will be available on Xbox 360 consoles this fall. The new Xbox experience, also announced today at the E3 Media and Business Summit, represents the first time in history that a mass-market consumer electronics device has been re-invented through free software, giving people more fun and intuitive ways to interact, play and enjoy entertainment content.

“Watching movies at home will never be the same. Netflix on Xbox 360 is an entertainment first, and we are bringing friends together with the best in entertainment content like no other device in the living room,” said John Schappert, corporate vice president of Interactive Entertainment LIVE, Software and Services Business at Microsoft. “We are creating a completely new social entertainment experience, and Xbox 360 will be the only video game system where you can access your library of instantly streamable movies from Netflix and turn any room into a virtual movie theater.”

10,000 movies and TV episodes sounds like a lot, but it really isn’t. Netflix has to up the available content for its streaming option if it wants it to be a success. But then, that’s been the gripe about the streaming option since it was unveiled.

By Alice Hill
RealTechNews

Kodak just announced the first 50 megapixel digital sensor, the KAF-50100 Image Sensor and today Hasselblad has unveiled the first camera to use the new chip. No word on pricing yet, but the Hasselblad H3DII-50 is definitely the sharpest camera on the market.

What does 50 megapixels mean? Consider this: with a 50 megapixel camera, if you took an arial photo of a 1.5 mile wide field, the sensor could zoom in and detect an object the size of a small notebook computer. Which of course begs the question - do we need this?
Source: Ubergizmo

By Alice Hill
RealTechNews

I fly every week and it’s grim business. The last thing you want to do is make getting through security any more drawn out than it already is. But for a vicarious laugh, here’s a tote bag we’d love to see coming off the x-ray belt.

The Xposed grocery bag features the makings of a meal + a handgun. And the tote features a bottle of Jack Daniels and brass knuckles. But the disclaimer says it all: “Note: Not recommended for Airplane Carry-On.”

Xposed Xray Tote
Source: Baronbob.com via Twitter

By Michael Santo
Editor-in-Chief, RealTechNews

Despite numerous assertions from both companies that they’ve “moved on,” and even a statement from Bill Gates indicating a Yahoo! deal is unlikely, it appears Microsoft continues to pursue Yahoo!, somewhat like a spurned suitor pursuing his ex-.

The latest in the continuing soap opera: a report that indicates that Microsoft is in talks with other companies, searching for partners for a new run at Yahoo!.

The Wall Street Journal story (subscription required) says that Microsoft has approached Time-Warner, parent company of AOL, and News Corp. among others. All very ironic, since Yahoo! approached both AOL and News Corp. previously as possible “white knights” after Microsoft’s unsolicited takeover bid.

Yahoo!’s stock was up over 7.5%, to $21.74 in morning trading, just a day after dropping below $20 during intraday trading, approaching pre-Microsoft offer levels.

However, those investors scooping up Yahoo! stock probably didn’t notice this paragraph (emphasis mine) in the WSJ report:

Some of the people familiar with these talks say they are preliminary and unlikely to result in a deal with Yahoo. Indeed, two weeks ago, Microsoft Chief Executive Steve Ballmer called Yahoo Chairman Roy Bostock to suggest they meet to discuss a new idea involving other partners, according to a person familiar with the matter. The meeting, scheduled for Monday, was subsequently canceled by Microsoft, which Yahoo took as a sign that Mr. Ballmer’s efforts to find a partner have so far failed.

They probably haven’t been listening to Gates’ statements, either.

Or maybe they just did; Yahoo! was as high as $21.90 before dropping to its current price.

By Michael Santo
Editor-in-Chief, RealTechNews

Until now Flash (.SWF) media files have been pretty, well, opaque: search engines couldn’t index them. For webmasters, this meant extra work, as the old adage was “a search engine likes text.” No longer.

In a press release on Tuesday Adobe announced that it was working with both Yahoo! and Google to enable indexing of Flash files. The project will enable searches on Flash content to return text and links, which can then be indexed. Better still, current Flash content will be immediately searchable by search engines, without alteration.

David Wadhwani, general manager and vice president of the Platform Business Unit at Adobe said:

“Until now it has been extremely challenging to search the millions of RIAs (rich Internet applications) and dynamic content on the Web, so we are leading the charge in improving search of content that runs in Adobe Flash Player. We are initially working with Google and Yahoo! to significantly improve search of this rich content on the Web, and we intend to broaden the availability of this capability to benefit all content publishers, developers and end users.”

Of course, all this assumes that the search engine has the Flash tech working: Google is rolling out Flash search today, but Yahoo! said it was going to enable the feature in a later release of its search engine and that it was “working with Adobe to determine the best possible implementation.” And no, Microsoft wasn’t mentioned at all.

However, Adobe’s statement does indicate Adobe will work with other search engines as well. With Microsoft having its Flash competitor, Silverlight, however, I’m wondering if that will slow things down between the two companies.

By Michael Santo
Editor-in-Chief, RealTechNews

With an initiative Real Networks is calling “Music Without Limits,” Rhapsody, which is co-owned by Real Networks and Viacom’s MTV Networks, launched an assault on iTunes Monday, with promotions by partners such as Verizon and Yahoo!, as well as an all-MP3 store.

MP3 = DRM-free, and that’s proven to be the best way to combat the iTunes juggernaut. Of course, that doesn’t mean that any such store has been all that successful, despite numerous attempts, such as Napster, Wal-Mart, and Amazon MP3; after all the ubiquity of the iTunes software means that the easiest (and thus, preferred) way to buy songs is still through the iTunes store.

According to Rhapsody’s press release:

Beginning today, consumers can purchase MP3 music from Rhapsody and its partners that is free of the digital rights management (DRM) software that restricts how and where people can play their music. Any song or album purchased at www.rhapsody.com/mp3 can be played on any MP3 player, even an Apple iPod.

The Rhapsody MP3 catalogue will include more than 5 million songs from all four major music labels — Universal Music Group, Sony BMG Music Entertainment, Warner Music Group, and EMI — and an extensive number of independent labels. The Rhapsody MP3 Store places a strong emphasis on the digital album with merchandising centers for “new album releases,” “old favorites,” and “who’s on tour.” Most albums will sell for $9.99 and tracks for $.99.

Little or nothing different price-wise, but Rhapsody does let you preview the full song when shopping, something other stores do not.

At the same time, the first 100,000 customers to sign up (or use; it appears this will work for existing customers) for the new store will get a free album via a $10 credit to their account, when they make an album purchase.

Meanwhile, in terms of partnerships, Rhapsody also said:

Beginning in the weeks ahead, consumers will be able to enjoy full-song playback (up to 25 songs per month per person) whether they are on Yahoo! Music or MTV.com, CMT.com or VH1.com, and they will have the ability to seamlessly go from playing a song on those sites to purchasing a DRM-free version of that music.

So, you’ll be able to hear songs on those sites, and buy them directly if you like them.

iLike will get Rhapsody power as well, with the following:

To give iLike’s enormous audience a taste of the popular Rhapsody Unlimited subscription service, Rhapsody will power free, full-song playback across iLike.com and iLike’s leading music applications on the Web’s most popular social platforms, including: Facebook, MySpace, hi5, Orkut, and Bebo.

Same as with Yahoo!, MTV, CMT and VH1, you’ll get 25 plays a month.

Finally, in terms of Verizon, the launch of V CAST Music with Rhapsody gives Verizon Wireless customers are the ability purchase songs over-the-air for $1.99; one copy gets delivered to their phone; the second automatically to their PC as an MP3. Cheapskate that I am, I wonder why you wouldn’t just buy from the MP3 store for less and transfer it to your phone, but go figure.

It’s all pretty impressive, but does anyone really think this will make a dent in the iTunes Store? Wonder why these sites don’t make a deal with iTunes instead? One need only think about how draconian Apple has been in its dealings with labels, wireless carriers, and studios to at least have a guess at why.