DealBook: Dell Begins Campaign to Support Leveraged Buyout

Kimihiro Hoshino/Agence France-Presse — Getty ImagesMichael S. Dell, the founder of the computer company that bears his name.

Dell Inc. on Friday began its official campaign to support a proposed $24.4 billion sale of itself to Michael S. Dell and the investment firm Silver Lake, amid continued opposition to the deal.

The computer company filed its definitive proxy materials after receiving final approval from the Securities and Exchange Commission. And it set July 18 as the date for a shareholder vote on the transaction.

In a letter to shareholders, the company stressed that its special committee had carefully reviewed all possible alternatives to the $13.65-a-share offer by Mr. Dell and Silver Lake and fought hard to get to that price.

“Our analysis led us to conclude unanimously that a sale to the Michael Dell/Silver Lake group for $13.65 per share is the best alternative available — in a challenging business environment it offers certainty and a very material premium over pre-announcement trading prices,” the company wrote.

Dell also argued that a full sale eliminates shareholders’ risk of the company’s fortunes tumbling further, something that would not be possible if it pursued a huge stock buyback and dividend plan. That runs counter to what two of its biggest investors, Southeastern Asset Management and the billionaire Carl C. Icahn, have demanded.

Bits Blog: A Ruling Could Support F.C.C.’s Net Neutrality Defense

Charles Rex Arbogast/Associated Press Justice Antonin Scalia

The Federal Communications Commission’s high-profile attempt to defend its net neutrality rules against a court challenge got major support on Monday from the Supreme Court, which ruled in a separate case that regulatory agencies should usually be granted deference in interpreting their own jurisdictions.

In a 6-to-3 decision, Justice Antonin Scalia wrote that in cases where Congress has left ambiguous the outlines of a regulatory agency’s jurisdiction, “the court must defer to the administering agency’s construction of the statute so long as it is permissible.”

That has big implications for Verizon v. F.C.C., in which Verizon challenged the F.C.C.’s Open Internet Order, its rules on net neutrality. Those rules said that an Internet service provider must treat all traffic on its system roughly equally, not giving priority to any one type of data or application as it moves through the provider’s Internet pipes.

The net neutrality case is pending before the United States Court of Appeals for the District of Columbia Circuit. The appeals court was expected to hear arguments in that case this spring, but deferred the case until next fall. Court watchers have speculated that the delay may have been spurred by anticipation of Monday’s decision in Arlington v. F.C.C., No. 11-1545.

“This case just gave the F.C.C.’s argument a lot more weight,” said David Kaut, a telecommunications regulatory analyst at Stifel, Nicolaus & Company in Washington. Mr. Kaut cautioned, however, that the differing facts of the two cases made it uncertain whether the precedent in the Arlington case was sufficient to validate the F.C.C.’s argument that it has authority to regulate Internet service providers.

Edward S. McFadden, a Verizon spokesman, said the company did not “anticipate that today’s decision in Arlington v. F.C.C. will have any effect on our appeal” in the net neutrality case.

That decision will be parsed for months, particularly because in explaining his reasoning, Justice Scalia constructed a hypothetical example that sounded very much like the Verizon net neutrality case.

Using two options of how Congress might have written a telecommunications law, Justice Scalia asked under which of those options the F.C.C. could legitimately claim jurisdiction over Internet service providers.

The answer, he said, was both.

“The question in every case is, simply, whether the statutory text forecloses the agency’s assertion of authority, or not,” he wrote.

The precedent applied by Justice Scalia in the Arlington case was Chevron U.S.A. v. Natural Resources Defense Council, in which the court held that courts must defer to an agency’s interpretation of its statutory jurisdiction unless it exceeds the specific bounds set by Congress.

How that applies to the Verizon case remains uncertain, however, because of a previous decision by the District of Columbia Circuit itself, in Comcast v. F.C.C. In that case, which involved a net neutrality enforcement proceeding, the circuit court said that the F.C.C. did not have authority over Comcast’s Internet service, because it was not ancillary to the authority laid out by Congress in the Communications Act.

Gadgetwise Blog: Q&A: Extending (And Ending) Support for Windows XP

What is “extended support” for Microsoft Windows XP and do I need to worry when it’s supposed to stop next year?

Microsoft has a defined period of time for things like help-line calls, warranty claims and security updates for the hardware and software it sells. This period of time is called the Support Lifecycle Policy and is supposed to give customers a firm idea of how long they can expect Microsoft to provide services for a product before the company considers it obsolete.

Microsoft’s current policy states that its Windows operating systems will each receive a total of 10 years of support. The first five of those years are “mainstream,” in which that version of Windows still has all the telephone support options available (including some free help by phone along with paid technical-support calls), security updates and some development work for requested features and design improvements.

After the first five years, the system moves into the “extended” support phase where security updates are still free, but any technical help by phone costs money; online troubleshooting articles from Microsoft’s Web site are still free and available for at least a year after a product’s extended support phase ends.

A significant amount of PC’s out there are still running Windows XP — about 38 percent as of March 2013, according to the research form Net Applications, which uses information from computers connected to the Internet. Still, Microsoft has been very open about the fact that it will be retiring Windows XP on April 8, 2014. The Support Lifecycle page for Windows XP even tells visitors to “Buy Windows 8 now!”

A post on one of its official Windows blogs basically states that while PC’s running XP will still continue to work after April 8, 2014, they could become targets for malicious software looking to take over newly discovered vulnerabilities in Windows XP. This situation could put users at risk since no Microsoft security patches will be available to plug the holes. The same post also says that antivirus-software companies that still support Windows XP will not be able to fully protect computers running the system. For those inclined to heed the company’s persistent warnings, information about upgrading from Windows XP can be found here.

Partnership Offers Support for Media Ventures

Can the nascent entrepreneurial ideas bouncing around Silicon Valley help reinvent public media?

Matter Ventures, a start-up accelerator that will provide four months of financial and logistical support for budding media entrepreneurs, will be unveiled Monday by its partners: KQED, a public television and radio station operator; the John S. and James L. Knight Foundation; and the Public Radio Exchange, known as PRX.

KQED, based in San Francisco, and the Knight Foundation are each investing $1.25 million in the initial $2.5 million fund and will have an equity stake in any projects that become viable businesses. PRX, based in Cambridge, Mass., is contributing strategic and management support. The project was announced a year ago as a PRX endeavor to be financed by Knight, before KQED became an investor.

While the partners would love to find the next Google, KQED, which just had two years of record-setting revenue, does not expect to get rich from the venture, John Boland, KQED’s president, said in a telephone interview.

Instead, Mr. Boland said, he is looking for ideas, whether new ways to distribute and share content, raise money or allow KQED’s audience to “engage more deeply with the content and with others.”

The goal is to help KQED reinvent itself in an era where its television ratings have been steadily declining and its radio audience is flat, he said. Broadcast audiences have stagnated even as KQED’s online and mobile audiences have boomed. Demand for its increased offering of local and regional news has been strong as commercial newspapers and television stations have cut back.

Being in the Silicon Valley area, KQED should be “tapping into the innovation ecosystem” outside its doors, Mr. Boland said. He said the accelerator was “specifically designed to attract creative people, entrepreneurs, who have ideas that relate to what we’re calling ‘media for good.’ ”

Mark Perry, a KQED board member who is a general partner in the venture capital firm NEA, called the accelerator “a tremendous opportunity.”

“As this new media world evolves we’re going to need more innovation around — not the content development, because that we know how to do — but how these productions can be distributed in the most effective way across these multiple platforms,” Mr. Perry said by telephone.

“It’s as much to stimulate the innovative side of our entire organization as it is to come up with any particular technique, particular technology or particular insight that may come out,” he said. But entrepreneurs are likely to be attracted to the model because KQED is a potential customer for any project that does work, he said.

Michael Maness, Knight Foundation’s vice president for journalism and media innovation, in a telephone interview said the accelerator also has the potential to speed the learning process for entrepreneurs in the news business. The foundation will also be able to publicly share insights gained from the projects, unlike those generated by private equity accelerators, he added.

The accelerator will be led by Corey Ford, a former producer for the PBS program “Frontline.” Mr. Ford most recently built Runway, an accelerator for the Google chairman Eric E. Schmidt’s early stage venture capital firm, Innovation Endeavors.

Matter Ventures will finance four rounds of five teams each over two years. Each of the 20 teams selected will get $50,000, mentoring from the KQED staff, and educational workshops, as well as work space in the Matter Ventures’ headquarters in the South Park section of San Francisco, just blocks from KQED.

“A big part of this is about the culture and the community that you create,” Mr. Ford said. Each round will end with a day of presentations to potential investors.

Applications for the first class, which will begin work in late February, are being accepted through Jan. 6 at www.matter.vc.

BET Running Anti-Obama Ad That Says “Support Of Gay Marriage Is A Slap In The Face” [Video]

BET is currently running an ad sponsored by the Pivot Point PAC that is clearly against President Barack Obama. The spot is currently running in Cleveland, Ohio and Seattle, Washington, and alleges that despite initial excitement at the prospect of having the nation’s first African-American president, Obama has passed measures that are not in the best interest of the Black community… Continue

F.T.C. Crackdown Aims At Tech Support Scams

WASHINGTON — Consumer frauds often make claims that are too good to be true. But a recent one, cited by regulators around the world Wednesday, depended on a pitch that many people found completely believable — that Microsoft or another computer company knows what is on your personal computer.

The Federal Trade Commission announced a multinational crackdown on so-called tech support scams, in which a caller fools a consumer into believing Microsoft or a computer security company has discovered that a PC is infected with harmful software. The caller then offers to fix the computer on the spot for a price. The target would sometimes let the ostensible tech support company gain remote access to his computer, allowing the company to download software to it.

In six cases filed in federal district court in Manhattan, the commission named 17 individuals and 14 companies, most in India, as participants in the operations, including many with legitimate-sounding names like Virtual PC Solutions and Zeal IT Solutions.

At the commission’s request, a federal district judge in Manhattan froze the United States assets of the suspects. The commission also said it had shut down 80 Internet domain names and 130 phone numbers in the United States used in the scheme. Efforts to reach several of the companies and individuals were unsuccessful.

Jon Leibowitz, chairman of the trade commission, said at a news conference that the scheme involved getting a computer user to look at a program that is a standard part of the Windows operating system.

That program, known as “Event Viewer,” displays logs of operating-system events, which can sometimes carry the benign label “Warning” or “Error.”

The caller would then warn that those files indicated viruses that could crash the computer or, in at least one case studied by the F.T.C., that the computer could explode.

“Clearly the defendant’s M.O. was to exploit these fears about malware hiding in the machine,” Mr. Leibowitz said. “These scams fleeced English-speaking consumers worldwide likely to the tune of tens of millions of dollars and resulted in innumerable Do Not Call violations in the United States.”

Officials said they were unable to pinpoint the number or dollar-amount of violations because many of the victims might not yet be aware they were taken.

But Microsoft later provided data on its contacts with 1,045 people who had told the company they believed they had been contacted by a fake tech support caller. More than 400 of those either fell victim to such operations, with losses averaging $875, or had to pay an average of $1,700 to repair damage to their computer.

The suspected fraud occurred in several English-speaking countries. Joining the F.T.C. in the enforcement action were the Australian Communications and Media Authority, the Canadian Radio-Television and Telecommunications Commission and Britain’s Serious Organized Crime Agency.

David Vladeck, director of the F.T.C.’s Bureau of Consumer Protection, said the commission was working with law enforcement officials in India to catch the perpetrators. The commission has also referred the cases to the Justice Department for possible criminal prosecution.

The scheme relied on boiler-room cold calls or ads connected to Google searches that offered the phone numbers for phony tech support services for a specific computer brand.

The callers, who usually asserted that they represented technology companies like Microsoft and Dell and security companies like Symantec and McAfee, would try either to sell virus-protection software or to get the consumer to allow remote access to his computer so that the caller could then “fix” it, for fees of $45 to $450.

Frank Torres, director of consumer affairs at Microsoft, who also spoke at the news conference, said the company “will never cold call a consumer and ask for their credit card information to charge them for a service that they don’t need.”

A consumer who gets a call like this, he added, should go to the site of a trusted computer-security resource to determine whether any threat is present.

In an interview, Mr. Torres said it was understandable that a consumer might believe that Microsoft could monitor the computers of Windows users.

Microsoft does have a lot of information about what is on many consumers’ computers. Most Windows users have probably seen a message asking if they want to send information about a program error to Microsoft.

And depending on a user’s security setting, Microsoft often sends patches and updates to its programs for consumers to download and install.

Microsoft collects that information because “part of our role is to do everything we can to protect consumers,” Mr. Torres said. Several units at Microsoft, including a digital crimes division, monitor messages from consumers about potentially illicit software or events.

The latest scheme is not entirely new; this week the commission ended a four-year investigation and enforcement action against a similar operation in which more than one million consumers were conned into buying software that supposedly remove malicious files. Last month, a federal district court in Maryland imposed a $163 million judgment against one of the defendants.

“Commerce is global, which is great for consumers, but it’s a double-edged sword,” Mr. Leibowitz said. “It allows scammers to go where the money is, where it’s made most easily and to engage in global scams.”

Man Didn’t Want To Pay CHILD SUPPORT . . . So He BURNED His One Year Old Son . . . ALIVE!

Yesterday police took into custody 29 year old Thomas Olivas. Texas police tell us that Thomas is a bitter ex-boyfriend who stabbed the mother of his child to death last year and left their one-year-old son to be burned alive with her body.

The animal has been on the run ever since. But yesterday, US Marshalls arrested him at a sports bar – as he ENJOYED a football game.

Here’s how the UKs Daily Mail is reporting it:

The bodies of Mechelle Gandy and her one-year-old son Asher were found in their smoldering apartment in Arlington on March 20, 2011.

Officials say that Miss Gandy had filed for child support from Olivas before she was killed, according to Dallas News. ‘It’s fair to say detectives think this may have played a factor in it,’ Arlington police spokeswoman Tiara Ellis Richard said. ‘But we don’t know if it’s the only reason.’

In March of 2011, her body was pulled out of her burning apartment on President’s Corner Drive where she lived alone with her son.

At the time, a neighbor said that he heard tires squealing before the fire broke out. Her body was found to have multiple stab wounds while Asher died of burns. The crime took place in TEXAS . . . so the MONSTER is likely to get the death penalty!!!

H.P. Wins Suit Against Oracle Over Support for Servers

Hewlett-Packard accused Oracle of violating a contract when it decided last March that it would no longer make new versions of its database software compatible with H.P.’s high-end servers based on the Intel Corporation’s Itanium chips. Oracle maintained that it had no such contract.

The servers are used mostly by large corporations with rigorous computing needs.

Judge James P. Kleinberg of Santa Clara County Superior Court wrote on Wednesday that a contract existed between Hewlett and Oracle, and that Oracle was required to continue to offer its product suite on Hewlett’s Itanium server platform.

Oracle is required to port its products to Hewlett’s Itanium-based servers without charge, the judge ruled.

“The parties had a long history of trust and collaboration, the promises made by the Oracle executives were clear and unambiguous,” Judge Kleinberg wrote in the preliminary ruling, “and the parties’ relationship was very profitable for both companies.”

Oracle said it planned to appeal the decision.

“We made the decision as we became convinced that Itanium was approaching its end of life and we explained our rationale to customers,” Oracle said in a statement. “Nothing in the court’s preliminary opinion changes that fact.”

The dispute began after the companies became rivals when Oracle bought Sun Microsystems. The purchase moved Oracle into the server hardware field, in which it previously was a partner with Hewlett-Packard.

Also, Oracle hired Mark Hurd, H.P.’s former chief executive, in 2011 after he left Hewlett amid questions over his relationship with a female contractor.

Judge Kleinberg’s ruling did not address damages. It is possible that a jury will decide the issue.

Hewlett-Packard, which seeks as much as $4 billion in damages, called the ruling “a tremendous win” and said it expected Oracle to comply with its “contractual obligation as ordered by the court.”

H.P. Wins Suit Against Oracle Over Support for Servers

Hewlett-Packard accused Oracle of violating a contract when it decided last March that it would no longer make new versions of its database software compatible with H.P.’s high-end servers based on the Intel Corporation’s Itanium chips. Oracle maintained that it had no such contract.

The servers are used mostly by large corporations with rigorous computing needs.

Judge James P. Kleinberg of Santa Clara County Superior Court wrote on Wednesday that a contract existed between Hewlett and Oracle, and that Oracle was required to continue to offer its product suite on Hewlett’s Itanium server platform.

Oracle is required to port its products to Hewlett’s Itanium-based servers without charge, the judge ruled.

“The parties had a long history of trust and collaboration, the promises made by the Oracle executives were clear and unambiguous,” Judge Kleinberg wrote in the preliminary ruling, “and the parties’ relationship was very profitable for both companies.”

Oracle said it planned to appeal the decision.

“We made the decision as we became convinced that Itanium was approaching its end of life and we explained our rationale to customers,” Oracle said in a statement. “Nothing in the court’s preliminary opinion changes that fact.”

The dispute began after the companies became rivals when Oracle bought Sun Microsystems. The purchase moved Oracle into the server hardware field, in which it previously was a partner with Hewlett-Packard.

Also, Oracle hired Mark Hurd, H.P.’s former chief executive, in 2011 after he left Hewlett amid questions over his relationship with a female contractor.

Judge Kleinberg’s ruling did not address damages. It is possible that a jury will decide the issue.

Hewlett-Packard, which seeks as much as $4 billion in damages, called the ruling “a tremendous win” and said it expected Oracle to comply with its “contractual obligation as ordered by the court.”

Metal Gear Solid 4 To Get Trophy Support

Metal Gear Solid 4: Guns of the Patriots will finally be receive trophy support this August, according to Andriasang.

Trophy support is being added to a 'PlayStation 3 The Best' budget version of the MGS4 which is being released in Japan. But if you already own a copy of the game, you'll be able to download a patch around this time.

Hideo Kojima has also said he will make an announcement at a special 25th anniversary event, to be held in Tokyo on August 30th. What that 'announcement' might be remains unclear, but it's said to be related to the 'vision' he has previously shared about a game that connects people.