Obama Defends Tax Deal, but His Party Stays Hostile

Struggling to ensure that the package would win approval, the White House deployed Vice President Joseph R. Biden Jr. to Capitol Hill in a bid to allay the concerns of Senate Democrats. Mr. Obama also held a news conference where, with uncharacteristic emotion, he suggested that liberals were unrealistic about what they could achieve in Washington and also slammed Republicans, at one point comparing them to hostage-takers.

?I?ve said before that I felt that the middle-class tax cuts were being held hostage to the high-end tax cuts,? Mr. Obama said. ?I think it?s tempting not to negotiate with hostage-takers, unless the hostage gets harmed. Then people will question the wisdom of that strategy. In this case, the hostage was the American people, and I was not willing to see them get harmed.?

But at the Capitol, Mr. Biden failed to convince many of his old Senate colleagues to line up behind the plan at a tense lunch meeting. In his pitch for support, he called it ?a bad situation? but ?a good deal,? participants said.

While many Democrats in the Senate and House raged against the idea of continuing George W. Bush?s tax policies for two more years ? and some voiced serious concerns about adding the $900 billion cost to the deficit ? the package seemed likely to win approval provided that Republicans vote for it in big numbers, as party leaders predicted they would.

Even with unanimous Republican support, which is not assured, at least 18 Senate Democrats would need to support the package to overcome a potential filibuster. About a dozen Senate Democrats have voiced a willingness to temporarily extend all of the Bush-era tax rates, given the weak economy. Aides said about 30 were firmly opposed, leaving 16 or so undecided.

Mr. Biden, who personally negotiated the deal with the Senate Republican leader, Mitch McConnnell of Kentucky, used the lunch meeting to emphasize provisions the White House had won, including a one-year payroll tax cut for all workers, a 13-month extension of jobless aid for the long-term unemployed and other steps to help lift the still-struggling economy.

But even the majority leader, Harry Reid of Nevada, expressed unhappiness with the deal and said changes were needed. ?This is only a framework,? Mr. Reid said. ?It?s up to the Congress to pass it. Some in my caucus still have concerns.?

The anger was rawer in the House, where Democrats met on Tuesday evening to discuss the proposal. ?I don?t think the president should count on Democratic votes to get this deal passed,? said Representative Anthony Weiner, Democrat of New York.

Emerging from the meeting, the House speaker, Nancy Pelosi, who has refused to commit her support, said only that ?there?s unease? in the caucus.

But in the unlikely event that Democrats vote down the package, the incoming Republican majority would presumably approve it in January ? perhaps after extracting further concessions from the White House.

Mr. McConnell described the accord as ?essentially final? and predicted that the vast majority of Republicans would vote for it.

At the White House, Mr. Obama?s long-simmering frustration with his party?s liberal wing seemed to boil over as he implored Democrats not to make the perfect the enemy of the good. Facing questions about his ?core principles,? Mr. Obama referred to the health care debate, in which liberals accused him of abandoning Democratic ideals when he gave up on a government-backed ?public option? health care plan.

?This is the public-option debate all over again,? Mr. Obama complained, adding: ?Now, if that?s the standard by which we are measuring success or core principles, then, let?s face it, we will never get anything done. People will have the satisfaction of having a purist position and no victories for the American people. And we will be able to feel good about ourselves and sanctimonious about how pure our intentions are and how tough we are, and in the meantime, the American people are still seeing themselves not able to get health insurance because of pre-existing condition, or not being able to pay their bills because their unemployment insurance ran out.?

Mr. Obama said he was taking a long view. ?My job is to make sure that we have a North Star out there,? he said. ?What is helping the American people live out their lives??

Jackie Calmes contributed reporting.

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Android users are the biggest data hogs

A new study has compared the data consumption of users of newer smartphones, including the BlackBerry Bold 9700, the Google Nexus One, the HTC Desire, the Sony Ericsson Xperia, and the Apple iPhone 4, against the iPhone 3G as a "normalised benchmark." Network management firm Arieso has highlighted the emergence of a new breed of mobile subscribers in the post-iPhone3G era. The company found that voice calls per subscriber have remained roughly flat, suggesting that these subscribers use their devices first and foremost for data consumption rather than for making phone calls.

The results show that iPhone 4 users are more hungry for data than their iPhone 3G counterparts, making 44 percent more data calls, downloading 41 percent more data to their devices, and spending 67 percent more time connected to the network for data.

Still, they do not even begin to compare to users with Android OS handsets. These are particularly data hungry, scoring higher than both the iPhone 3G and iPhone 4 in terms of data call volumes, time connected to the network, as well as data volume (in kilobits per subscriber) uploaded and downloaded. Android users also score highest in both the "uplink data volume" and the "downlink data" categories. For example, Samsung Galaxy users typically upload 126 percent more data than iPhone 3G users, and HTC Desire users download 41 percent more data than iPhone 3G users.

"Smartphone subscriptions are rising and so too is subscriber appetite for mobile data," Michael Flanagan, CTO of Arieso, said in a statement. "Since the launch of the iPhone3G, we've seen a multitude of popular new smartphones arrive on the market, successfully driving app and service usage. It's a trend thats set to continue. Operators must now be able to quantify the impact of the devices they support, and how subscribers use them, and prepare their networks accordingly."

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The Caucus: Key Vote Near on ?Don?t Ask, Don?t Tell?

The Senate headed toward a crucial vote Wednesday afternoon on the fate of the Pentagon?s ban on gay Americans serving openly in the military.

Senator Harry Reid, the Nevada Democrat and majority leader, said earlier Wednesday that he intended to exercise his ability to call for the reconsideration of an earlier vote blocking a broad Pentagon measure that contains a repeal of the policy.

In order to entice some Republicans to back the procedural move, Mr. Reid, according to his aides, has offered the opposition the right to offer multiple amendments. If Mr. Reid can win the vote on the underlying Defense Department policy measure, the Senate would be on the verge of repealing the ban. A failure to cut off the filibuster probably dooms the repeal for this session of Congress.

Mr. Reid won a new Democratic ally Wednesday in his push to lift the ban when Senator Mark Pryor, Democrat of Arkansas, said he would support efforts to bring the Pentagon measure to the floor.

?I have now carefully reviewed all of the findings, reports and testimony from our armed forces on this matter, and I accept the Pentagon?s recommendations to repeal ?don?t ask, don?t tell,?? Mr. Pryor said in a statement. ?I also accept the secretary of defense and chairman of the joint chiefs? commitment that this policy can be implemented in a manner that does not harm our military?s readiness, recruitment or retention.?

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Netflix strikes deal with Disney and ABC

Netflix has announced a new licensing agreement with Disney-ABC Television Group. Netflix will soon be able to stream hundreds of episodes from the ABC Television Network, Disney Channel, and ABC Family over the Internet. Relevant programming will appear on Netflix at least 15 days after initial telecast. After that, episodes can be streamed instantly with Netflix memberships starting at $8 per month. While the agreement encompasses hundreds of TV episodes, both new and old, it's important to note that Disney Channel and ABC Family movies, also both new and old, will also be available.

Netflix recently said it was willing to pay up to $100,000 per episode in order to put new TV shows on its Watch Instantly feature. The number is certainly impressive, even if the price didn't end up going that high in this particular deal. Unfortunately, it looks like Netflix users are still going to have to wait over two weeks to get many of the episodes they want to watch right away.

"TV content streamed from Netflix has proven to be immensely popular with our members," Ted Sarandos, Netflix's chief content officer, said in a statement. "Adding to our existing Disney-ABC lineup with great network and cable shows, and opening up ABC Family for the first time, are important steps in creating a wide and diverse selection of content Netflix members of all ages can watch."

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Economic Scene: In Tax Plan, a Boost for Jobs

A year ago, President Obama and the Democrats made the mistake of assuming that an economic recovery was under way. This week?s deal to extend the Bush tax cuts shows that the White House?s top priority is avoiding the same mistake again ? even if it has to upset many fellow Democrats in the process.

Mr. Obama effectively traded tax cuts for the affluent, which Republicans were demanding, for a second stimulus bill that seemed improbable a few weeks ago. Mr. Obama yielded to Republicans on extending the high-end Bush tax cuts and on cutting the estate tax below its scheduled level. In exchange, Republicans agreed to extend unemployment benefits, cut payroll taxes and business taxes, and extend a grab bag of tax credits for college tuition and other items.

For the White House, the deal represents a clear shift in policy focus. Mr. Obama and Democrats spent much of the last year pursuing long-term goals like a health care overhaul and financial regulation, while hoping the economic recovery would continue. But with the recovery faltering and Republicans retaking the House, the administration is turning back to short-term job creation.

Congressional Democrats have reacted with a mix of wariness and anger, and some said Mr. Obama should have put up a fight on the high-end tax cuts. Yet once the Democrats bungled this issue ? failing to deal with it before the midterm elections ? their choices were extremely limited. If they stood firm on the high-end tax cuts and Republicans stood firm as well, all of the Bush tax cuts, not just those on income above $250,000, would have expired Dec. 31. The economy would surely have suffered as a result, and a bad economy is rarely good for the party that holds the White House.

Tellingly, economists and Democratic policy experts were largely pleased with the deal. Forecasting firms on Tuesday upgraded their estimates for growth and job gains over the next two years. Economists at Goldman Sachs, who have been more negative and more accurate than most Wall Street forecasters lately, called the deal ?significantly more positive? than they had anticipated.

And left-leaning policy experts said the package did more to create jobs than they had thought possible after the Republicans? midterm election victories. Robert Greenstein, Lawrence Mishel and John Podesta ? who run prominent Washington research groups that range from liberal to staunchly liberal ? all offered praise for the package. Of its estimated $900 billion-plus cost over two years, roughly $120 billion covers the high-end tax cuts and the estate tax cut, $450 billion covers Mr. Obama?s wish list and $360 billion covers the tax cut extensions both parties favored.

?People are kind of venting their disappointment and acting as if the administration did a terrible job in the negotiations,? said Mr. Greenstein, who runs the Center on Budget and Policy Priorities. ?But it didn?t. The mistake the administration made ? and it was a serious one ? was that it should have dealt with this well before the election.?

Still, the risk for Democrats, and the economy, remains the same as it was. Financial crises wreak terrible havoc. They typically cause unemployment to rise for more than five years and leave consumers and business uncertain about when healthy growth will finally resume. Aftershocks are common, as is evident in Europe. Virtually no economist believes the new stimulus package will be big enough to make the economy feel healthy anytime soon.

The ideal package would have been larger than the current one, and it would have been better tailored. The $120 billion cut in the payroll tax, for example, will apply to the portion paid by workers, not companies. The Congressional Budget Office and other analysts have said that cutting the workers? portion provides less bang for the buck because individuals are likely to save some portion of the money. Cutting the employers? portion subsidizes hiring.

But politics prevented the best kind of payroll tax cut. Republicans did not want one larger than the $120 billion, one-year cut in the package. Administration officials wanted the political benefit of having that whole sum apply to individual workers. The resulting compromise will help the economy, but not as much as it could have.

Initial estimates by economists suggested that the overall legislation would reduce the unemployment rate by one-half a percentage point to a full point over the next year, compared with allowing all the tax cuts to expire and passing no new stimulus. By the end of 2012, the decline could be up to 1.5 percentage points, economists said.

On the other hand, the unemployment rate will still probably be near 8 percent by the end of 2012, when the current package expires, and the two parties will get to have this fight all over again.

What?s the early line on that fight? Republican officials hope that Democrats will again find it hard to let all the tax cuts expire in the name of letting some expire. White House officials hope the economy will have improved enough by then to help Mr. Obama win re-election ? and to allow him to threaten, credibly, to veto any bill that includes a tax cut for the wealthy.

There is also one big unknown looming over the whole debate: the deficit. This week?s deal, of course, will worsen the deficit. In the short run, many economists believe a larger deficit is better than the alternative. As Ben Bernanke, the Federal Reserve chairman, said during a recent ?60 Minutes? interview, ?We don?t want to take actions this year that will affect this year?s spending and this year?s taxes in a way that will hurt the recovery.?

Yet Mr. Bernanke and other economists usually add another point. Any additional spending now, they say, should be paired with future deficit reduction. Otherwise, the long-term deficit will continue to rise, and nervous investors may eventually demand that the federal government pay higher interest rates. Interest rates remain low for now, but they did rise on Tuesday, after the compromise was announced.

The problem is that raising the deficit ? be it through high-end tax cuts or a new stimulus program ? is a lot easier than cutting it. Strange as it may sound, some of the only fiscal conservatives in Washington this week have been liberals who would be willing to let everyone?s taxes rise. And they seem unlikely to win on this issue.

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How Social Media Will Impact The Future of Brands [TNW Social Media]

There?s no doubt that social media is changing and evolving rapidly ? and brands are constantly exploring new ways to make social media work for them. At the moment we?re still in the learning phase and we?re seeing lots of brands making some (very public) mistakes, as we test the boundaries of social technologies for consumer interaction. Mistakes are fine, and expected, so long as we learn from them. So what will brands of the future look like from the realms of social media, and how much should you let it affect your brand?

Accept that the 9-5 is dead

The use of social media in the workplace is a pretty touchy subject. While some companies may actively encourage its use, others go to the complete other end of the spectrum and block access to sites like Facebook and Twitter. Just like the brands of the future, employees of the future will be social too. The trick for organisations is to find out how this can be used to benefit business. The internal structure of future brands will not look how it looks now, and the flexibility of social technologies has a lot to do with this. At new companies and sites like The Next Web, everyone is encouraged to be social. And we know that the normal office hours don?t apply. The 9-5 is officially dead. For an excellent discussion on this, I recommend you check out this TEDX talk by Jason Fried.

Branding will be alive

This may be harder to contemplate, but more and more we?re seeing a company?s brand interpreted by the millions, as we all become producers of content and add our own interpretation onto a company?s brand and messaging. Static branding will be a thing of the past and company logos, advertising and messaging will be constantly moving, adapting to people?s needs. I think the static company logo will be unrecognisable in 50 years time and the idea of a corporation as an unmoving entity will be hard to get our heads around. We?re just at the tip of the iceberg with things like companies crowdsourcing their logos and this trend will only get bigger. Brands will find a way to fit around what we want them to be, rather than the other way around.

Will translate social actions into concrete actions

Malcom Gladwell recently wrote an article, where he questioned the ability for social media to encourage real action. So is it just a place for all talk, or can companies find a way to encourage interaction from users that translates into a tangible business benefit? Awareness is one thing, but sales is quite another. The challenge for brands now, and brands of the future, is to adapt their business model to fit social. You?re less likely to be able to take a consumer from Facebook to the checkout, but if you invest in social transactions such as group buying, you?ll start seeing a lot more sales. Again, we?re seeing mistakes as companies attempt to encourage transactions in the wrong way but there are also some great case studies to learn from.

Look for innovation outside the boardroom

They get their fair amount of ctricism, but there are lots of lessons that can be learned from Coca Cola as a social brand. They did what is incredibly difficult for any brand to do, especially as multinational as themselves, and that was to work with an ?unofficial? community and find a way to successfully integrate them into the business. Coca Cola?s Facebook page wasn?t set up by the organisation themselves, but by two uber-fans. They could have done what many others did before them and shut the page down before setting up their own one from scratch. But instead they realised the huge power this group already had, and decided to work with the founders and keep them on as community managers for the page. This is a brave thing for a brand to do, given that when they did this social media was still a relatively new concept for many businesses. Don?t underestimate how important it is to work with a community and not against them.

Won?t have chairs in the meeting room

With the increasing mainstream adoption of online collaboration tools, brands of the future will not have a traditional meeting room, or the need to call meetings at all. Everything will eventually move online, making companies more efficient, adapting their communication to get the message out as quickly as possible. Companies will be less likely to call meetings, but when they do, there will likely be no chairs in the room. Screens will connect everyone over Skype etc. as you hook up with colleagues remotely. Hopefully the meeting room will die out altogether eventually, but that may be too tough to call yet.

What do you think brands of the future will look like?

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Intel, AMD, system builders to drop VGA by 2015

Intel has announced plans to cease support for the widely used VGA and LVDS display connectors in its processors and chipsets by 2015. Additionally, Chipzilla has teamed up with other industry titans, including AMD, Dell, Lenovo, Samsung, and LG to phase out the dated interfaces in favor of newer, more capable connection types, such as DisplayPort and HDMI.

In fact, AMD's plans are even hastier. The company intends to begin phasing out native VGA and LVDS output from most products by 2013, with expansion to all AMD products by 2015. It was noted that this also means DVI-I will be dropped in the same period.

In its press release today, Intel said HDMI is increasingly used in PCs for easy connection to consumer electronic devices and TVs, while DisplayPort is expected to become the single PC digital display output for embedded flat panels, monitors and projectors.


Both allow for slimmer laptops and support higher resolutions and more colors than the 20-year-old VGA connector. On top of the better visuals, Intel says DisplayPort and HDMI consume less power, so they're also better for battery life on mobile systems.

"Display standards are rapidly evolving, with new features such as multi-display support, stereoscopic 3-D, higher resolutions and increased color depth quickly moving from early adopter and niche usage to mainstream application," said AMD. "VGA, DVI and LVDS have not kept pace."

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Single software licence shared 770,000 times

Avast Software has discovered that one multi-user license for its Pro Antivirus was at one point being used by 774,651 individuals in over 200 countries. It started as a 14-user license for a small firm in Tucson, Arizona issued on June 30, 2009 but grew exponentially in use by late 2010. Except for the original 14 users, all of the others were pirates.

The speed at which the pirated license spread from Arizona was accelerated by warez sites, and Avast was quick to point out the "paradox" in computer users looking for "free" antivirus programs at locations with a known reputation for spreading malware. The avast Virus Lab has more than once documented examples of warez sites distributing packages of a "cracked" antivirus programs combined with malware.

The pirated license for the pro version gave a quarter of a million computers access to two additional features: a virtualization sandbox and a script shield. Other than that, the users didn't gain much, given that the same antivirus engine is used in the free and pro versions of avast's antivirus. Nevertheless, the identified users were sent a pop-up (pictured above) notifying them that they had a pirated license and that they would be cut off from virus database updates. They were also given the option of converting to the free version or buying the pro version.

"We made a decision to see just how viral this one license for avast! Pro Antivirus could be. The answer is 'very'," Vince Steckler, CEO of AVAST Software, said in a statement. "Now we are in the process of converting these pirates over to legal products."

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Democratizing DNA Sequencing

A device that reads the sequence of DNA using semiconductor technology could bring the power of sequencing to a much broader swath of the science world. The desktop machine, developed by a startup called Ion Torrent, is slated to go on sale this month and will cost $50,000, about one-tenth of the cost of other sequencing machines on the market.

"It takes the democratization of sequencing to the next level," says Chad Nusbaum, codirector of the genome sequencing and analysis program at the Broad Institute of MIT and Harvard, who has been testing the device. "Virtually anyone with good grant funding can buy one."

Nusbaum and others say the biggest advantage of the new technology is its speed; it can sequence a sample of DNA in a couple of hours, rather than the week or more required by most of the machines now on the market. That could make the technology particularly useful for genetic diagnostics, which require a quick turnaround.

Life Technologies, a major player in the genomics industry, bought Ion Torrent for $315 million in cash and stock last August. Ion Torrent's founder, Jonathan Rothberg, says that Life Technologies was particularly interested in his technology because of the potential diagnostic applications, though he is careful to note that the machine is only meant for research use at the moment.

The new device reads a much smaller amount of DNA than larger, more expensive machines. The current version analyzes 10 to 20 million bases per run, while the human genome is 3 billion bases. (Machines made by genomics giant Illumina, in contrast, can sequence about 250 billion bases of DNA in a weeklong run.) However, diagnostic and other applications only require analysis of limited stretches of DNA.

At the heart of Ion Torrent's technology is a semiconductor chip manufactured in the same foundries as computer and cell-phone microprocessors. The chip holds an array of 1.5 million sensors, each topped with a small well designed to hold a single-stranded fragment of DNA. To sequence a strand of DNA, the machine synthesizes a complementary strand, sequentially attempting to add each of the four bases that make up DNA one by one to the well. When the correct base is incorporated into the growing sequence, it triggers a chemical reaction that releases a positively charged hydrogen atom, which is detected by the sensor. A computer stitches together the sequence by integrating these signals with knowledge of when each base was flowed through the chip.

The device is so much cheaper than other machines because of its simplicity; the chip itself detects the sequence, and it does so electronically. Other devices use optical systems, which require lasers, cameras, and microscopes. (These devices also read DNA sequence by synthesizing a complementary strand?but chemicals used in the reaction have to be modified to fluoresce when added to the growing piece of DNA; a camera detects the flashes of light.) "It's a simple system to implement," says Nusbaum of Ion Torrent's technology. "Not just the machine, but also the infrastructure around it."

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Dell continues comeback in Q3 2010, Asus enters top five

Despite the slowdown in consumer sales, the PC market is continuing to slowly grow in the third quarter of 2010, according to market research firm iSuppli. Worldwide shipments were at 88.1 million units in Q3 2010, up 6.7 percent from Q2 2010, and up 10.3 percent from Q3 2009. Corporate PC demand in the third quarter was particularly evident: desktop PC shipment sales rose sequentially by 11 percent in the third quarter, compared to only a 4.2 percent increase for notebooks. iSuppli's definition of PCs encompasses desktops, notebooks and entry-level servers.

In the top five, Dell, Lenovo, and Asus saw solid growth while HP and Acer dipped. After reclaiming second place in the global PC market in Q2 2010 (which it had lost to Acer nine months earlier), Dell has not only maintained its ranking but has managed to capitalize on the corporate PC market refresh cycle. Lenovo delivered another impressive quarter; during every 2010 quarter, the company has so far achieved year-over shipment growth in excess of 30 percent. Asus managed to move into the top five ranking, displacing Toshiba into sixth place.

"The second quarter of 2009 was a terrible period for the PC market, but the following three months marked the beginning of the recovery, representing the first quarterly period in 2009 when shipments grew on both a sequential and year-over basis," Matthew Wilkins, iSuppli's principal compute platforms research analyst, said in a statement. "Because the third quarter of 2009 was stronger, the year-over-year growth rate in the third quarter of 2010 appears weaker than it was during the second quarter of 2010."

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