Microsoft's acquisition of Skype for $8.5 billion becomes official

It was pretty much known about since last night, but Microsoft and Skype have now obliterated any lingering doubt in the matter: the Redmond-based software giant will acquire the internet telephony company for a cool $8.5 billion in cash. Xbox and Kinect support are explicitly mentioned in the announcement of this definitive agreement, as is Windows Phone integration -- both the gaming and mobile aspects being presumably key incentives for Microsoft to acquire Skype. Importantly, this purchase shouldn't affect Skypers outside of the Microsoft ecosystem, as Steve Ballmer's team promises to continue "to invest in and support Skype clients on non-Microsoft platforms." Skype was first sold for a relative bargain at $2.5b to eBay in 2005, who in turn sold most of it off to Silver Lake in 2009 at an overall valuation of $2.75b, and now Redmond is concluding proceedings by tripling those earlier prices and offering Skype a permanent home. A new Microsoft Skype Division will now be opened up to accommodate the newcomers, with current Skype CEO Tony Bates becoming president of that operation and reporting directly to Ballmer. The deal is expected to close by the end of this year and you can read Microskype's full announcement after the break.

Update: Microsoft has just disclosed a couple more details about the deal. It was signed last night, May 9th, though the price was finalized on April 18th. You can follow a live stream of Steve Ballmer and Tony Bates' presentation right here.

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Games officially declared art in US

NEA (National Endowment for the Arts), which works under the US federal government, has officially recognised video games as an eligible art form under its new grant application guidelines.

NEA issues grants for works deemed as art or works that are about the arts. In digital terms, only television and radio works were acknowledged, but NEA has expanded its guidelines under a new ' Arts in Media' category, which now incorporates: "All available media platforms such as the Internet, interactive and mobile technologies, digital games, arts content delivered via satellite, as well as on radio and television."
NEA issues grants of up to $200k to works of art or works that are about the arts to artists creating outside of the commercial world for support while they create. This would allow small (or individual) developers to create games to offer for free while being funded by the government, as painters and sculptors have been able to for years.

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PSN servers were 'unpatched and had no firewall installed,' security expert testifies

The House of Representatives Energy & Commerce Subcommittee on Commerce, Manufacturing and Trade continues to seek answers regarding last month's breach of the PlayStation Network's security. The one it got yesterday from Purdue professor and security expert Dr. Gene Spafford is troubling, to say the least, if the situation he detailed actually played out as described.

Spafford told the subcommittee that, according to security mailing lists he subscribes to, "individuals who work in security and participate in the Sony network" had learned "several months ago" that PSN was hosted on servers running "very old versions of Apache software that were unpatched and had no firewall installed."

The professor continued, "they had reported these [issues] in an open forum that was monitored by Sony employees, but had seen no response and no change or update to the software." The timeframe for these events was "two to three months prior to the incident where the break-ins occurred," according to Spafford.

It's important to note that his account of the situation and information is second-hand. Still, the potential for this testimony to cause the subcommittee, headed by representative Mary Bono Mack (R-CA), to demand more answers from Sony -- and, more specifically, the individuals mentioned by Spafford -- does exist.

Sony could not be reached for comment.

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Zero Punctuation: Portal 2

Second experiment hints at seasonal dark matter signal

Things just got a little less lonely for researchers who have been insisting for years not only that their experiment has found dark matter, but also that the dark matter signal varies with the seasons. Now a second experiment, called CoGeNT, is reporting similar findings, though both results are in conflict with two other teams' observations.

No one knows what dark matter is – astronomers merely detect its gravitational pull on normal matter, which it seems to outweigh by a factor of five to one. But many researchers believe it is made of theoretical particles called WIMPs, which interact only weakly with normal matter.

Since 1998, researchers running the DAMA experiment deep inside the Gran Sasso mountain in Italy have claimed to have found evidence of WIMPs.

DAMA uses an array of sodium iodide detectors to spot the rare moments when WIMPs slam into atoms in the detectors, producing flashes of light. The number of flashes ebbs and flows with the seasons, and DAMA team members argue that this is because Earth's velocity relative to the surrounding sea of dark matter changes as the planet orbits the sun. They say their observations could be explained by a WIMP weighing a few gigaelectronvolts.

Tense situation

However two other experiments have found no sign of dark matter with their detectors. One, called XENON100, uses 100 kilograms of liquid xenon deep below Gran Sasso mountain, and the other, called CDMS II, uses ultra-pure crystals of germanium and silicon housed in a deep mine in Soudan, Minnesota.

Both experiments are so sensitive that they should have seen dark matter if the DAMA result is due to WIMPs. "The situation has created tension," says Dan Hooper, a theorist at the University of Chicago in Illinois.

Now another dark matter experiment called CoGeNT has found a seasonal variation in its results, reports team leader Juan Collar, who presented an analysis of 442 days of observations at the American Physical Society meeting in Anaheim, California, on Monday.

"We tried like everyone else to shut down DAMA, but what happened was slightly different," Collar said during his presentation.

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Fleeting antimatter trapped for a quarter of an hour

What can you do with a quarter of an hour? Write a few emails, cook rice – or store antimatter.

The team working on the Antihydrogen Laser Physics Apparatus (ALPHA) at the CERN particle physics laboratory near Geneva, Switzerland, have stored atoms of antihydrogen for 1000 seconds – roughly 10,000 times longer than before. This should help reveal if antimatter and matter are true mirror images.

Antihydrogen atoms are annihilated by hydrogen. The ALPHA team want to keep antimatter intact long enough to study it, so last year they worked out how to hold a cloud of antihydrogen in a magnetic trap. Not for long, though: collisions with trace gases would have either annihilated the anti-atoms or given them the energy to escape, so the team opened the trap after 170 milliseconds and observed the resulting annihilations, verifying that antimatter had been made.

Now they have repeated the experiment, this time waiting much longer before opening the trap. They also cooled the antiprotons used to create the antihydrogen much further, which lowered the energy of the antimatter, allowed more to be squeezed into the trap and raised the chance that some would last longer (arxiv.org/abs/1104.4982).

Antimatter's life extension will permit experiments, such as checking whether antihydrogen occupies the same energy levels as hydrogen, "perhaps within the next few years", says Daniel Kaplan of the Illinois Institute of Technology in Chicago, who is not on the ALPHA team.

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Netflix Streaming May be Putting a Hurt on File Sharing

Netflix started life by putting the squeeze on Blockbuster with DVD rentals and soared to unparalleled success with its Watch Instantly platform. Since 2008, Netflix’s library has swelled as the company signed multi-million dollars deals with content providers including Starz and CBS (yeah, we’re still excited about all of Star Trek coming to Netflix, too). With all that content, Netflix has obviously changed the way we watch movies and TV on a daily basis--but just how much has it revolutionized the online landscape?

Two web analytics organizations have weighed in on Watch Instantly’s popularity and its impact on peer-to-peer file sharing. According to one study, bittorrent has taken a big hit since 2007, with Netflix stepping up to fill in the gap.

Wired polled Arbor Network and Sandvine to rustle up any evidence suggesting Netflix’s streaming service has eaten into peer-to-peer movie sharing. With more than 23 million subscribers, Netflix is poised to become the largest subscription-based entertainment service in the US. That popularity has driven Netflix traffic into the stratosphere--it represents something like 20% of US downstream bandwidth during peak hours. According to Arbor Network, bittorent traffic fell from a high of more than 30% of US traffic in 2007 to a mere 8% of 2011’s measured bandwidth.

That 30% included all types of peer-to-peer filesharing, and some of that traffic has doubtless carried over to direct download sites like Rapidshare. Still, that drop in traffic leads us to two possible situations: Netflix’s growth (Arbor measures it at 20% of current US traffic) has actually impacted P2P traffic over the past four years, or non-P2P services have grown so significantly that P2P simply represents less bandwidth by comparison. The real answer probably falls somewhere in between.

The second traffic measurement from Sandvine tells a different story. It shows dramatic growth in Netflix streaming--from 29.5% of North American traffic to 42.7% between 2009 and 2010--but also depicts a rise in P2P filesharing over that same period. Sandvine’s traffic readings indicated peer-to-peer sharing jumped from 15.1% to 19.2% of bandwidth between 2009 and 2010. Obviously there’s no real consensus on Netflix’s mighty influence, but there are two major factors that still make piracy an attractive alternative to Netflix.

Watch Instantly’s library must continue to expand to win out against piracy--even if pirates are willing to pay $8 per month for their video content, they’ll go right back to torrenting if something isn’t available for instant streaming. The second problem, of course, is quality. So far Netflix’s HD support remains limited, and only the PlayStation 3 offers streaming of 1080p video. As long as streaming remains sub-1080p and Blu-ray rips are easy to come by, piracy will own a nice little chunk of bandwidth usage.

Streaming quality will only get better as average broadband speeds continue to improve, but we wonder how much Netflix can offer on Watch Instantly while remaining profitable. The service already contains an obscene amount of content, and Netflix will have to pay hundreds of millions in the coming years to secure new deals with providers like Starz. But if it can conquer that hurdle and by gaining even more subscribers, P2P numbers may look pretty meager within the next half decade.

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FBI Raids Students, Looking For Gold Farming Fraud

The FBI now is raiding homes looking for World of Warcraft gold farmers. The party van showed up March 30 at an apartment shared by two University of Michigan students (building pictured), who say the feds have got the wrong suspects.

The two students, neither named, say they aren’t gold farmers and don’t play World of Warcraft. “They thought we were involved in some kind of fraud,” said one. “I’m pretty sure they have the wrong people, but they took all my stuff.”

Why is the FBI interested in gold farming? Computer World posits they may be looking for terrorist connections, either with gold farming as an enterprise funding them, or believing that the virtual worlds of these MMOs is where they plan out their operations.

Paperwork says investigators think someone at the address was in on “a scheme to set up fraudulent bank accounts to buy and/or sell ‘virtual currency’ or ‘gold’ to be used in the game”. They were looking for online transaction records associated with World of Warcraft, the Chinese gold-farming website gameusd.com, eBay, PayPal and the United Services Automobile Association.

At least they didn’t shoot anybody.

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Wii Successor Must Launch By This Christmas, says AnalystWii 2 rumors have been flying of late, and today the speculation reached a new high, based on

Wii 2 rumors have been flying of late, and today the speculation reached a new high, based on multiple sources claiming that a new HD Nintendo console would be announced at E3. Many would argue that a new Nintendo console has been long overdue. The Wii's been declining in sales, software support has dried up, and the competition has better motion controllers. One analyst told IndustryGamers that Nintendo better launch a Wii successor by this fall/holiday or else.

Sterne Agee's Arvind Bhatia told us, "We are hearing the same thing [about a new Nintendo console] from our channel checks. I think Nintendo has to upgrade this Christmas, given how weak Wii sales have been. Launching this year means they will be able to protect their market share. Sony and Microsoft will probably still wait until 2013 to launch their next consoles," he said.

Ubisoft CEO Yves Guillemot recently called for all the platform holders to advance the cycle and upgrade as soon as possible. We agree with Bhatia, however, and feel that Microsoft and Sony will have at least 2 more years.

EEDAR's Jesse Divnich wouldn't be surprised to see a Wii 2 announcement at E3 either. He noted, "Nintendo originally announced the Wii at E3 in 2005, nearly 18 months before its official launch. It wouldn't be out of the question for Nintendo to announce some top-line specs on its new hardware. In terms of what does this mean for Nintendo? Unfortunately, not enough information exists to warrant any type of speculation, but rest assured Nintendo will continue to dedicate themselves to creating original hardware and software."

DFC Intelligence's David Cole doesn't think Nintendo will push things quickly enough to launch a successor this year, and he said that Nintendo might wait for sometime after E3 to announce. "In our forecasts for the industry we have a new console system from Nintendo launching second half of 2012. However, when it will be announced is another question. E3 could be a possibility but you also have to consider Nintendo's home turf is Japan and they may be more comfortable at a venue like TGS."

He continued, "Our new forecasts come out next month...if Nintendo announces a Wii 2 launch for 2011 we will have to go back to the drawing board real quick. We think the Wii is on the downward cycle of its life and sales will naturally decline every year. However, we still see Wii as the number one selling system in 2011. It will not be until 2012 that DFC forecasts Xbox 360 and PS3 sales will exceed Wii. As for Wii 2 we see it being a fairly successful system as consumers are really craving new hardware and Microsoft and Sony show no signs of delivering. We think it will be a strong seller but not nearly as strong as the Wii."

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'Glasses-free' 3D coming to iPad 2

A technology research group has unveiled a new piece of software that adds 3D-functionality to the iPad 2. It also works for iPhone.

At the beginning of the month, we reported on an April Fool’s joke about a 3D screen for the Apple iPad 2. Well, it turns out that the gag is heading towards reality.

The Engineering Human-Computer Interaction (EHCI) research group has unveiled a clever hack for the iPad 2 that can successfully track the position of a person's head in 3D in real-time. Dubbed the Head-Coupled Perspective (HCP), the innovative software hack uses the iPad’s front-facing camera to create a ‘glasses-free’ monocular 3D display.

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