Tax change for music and e-books

24 March 2014 Last updated at 13:45

Digital downloads could be hit by price hikes early next year as they become subject to UK tax rates.

Currently download prices include a levy based on taxes in the country where a business is located.

Big web firms have sited offices in Luxembourg so they can charge at tax rates lower than the UK's 20% VAT.

Closing the loophole could bring in revenues of about £300m in its first year, according to government estimates.

The tax change will apply to downloads of films, music, e-books and smartphone games.

Chancellor George Osborne mentioned the plan to change rates in his Budget speech last week. The plan was first set out in the government's Finance Bill and the change will come into force on 1 January 2015.

The change is part of a wider European Union push to ensure taxes are levied in the country where goods and services are consumed rather than where a business has its head office. The proposal to shift rates in this way was first made in 2008.

Music, book and smartphone game downloads are likely to be affected by the change as the UK VAT rate of 20% on those goods is higher than those in Luxembourg where music, film and game downloads have a 15% tax rate and e-books 3%.

In total, about 34,000 firms will be affected by the change, estimates the Office for Budget Responsibility.

However, the tax switch is likely to have the greatest impact on purchases made via Amazon's web store and Apple's iTunes. It is not clear yet whether the change will mean an increase in prices. Neither Apple nor Amazon has commented on the news.

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Google Glass in Ray-Ban tie-up

25 March 2014 Last updated at 13:29

Google is teaming up with the designer firm behind Ray-Ban and Oakley in an attempt to make its wearable technology desirable beyond the "geek" community.

The tie-up with Italian eyewear designer Luxottica will create "avant-garde" design according to the fashion firm.

Google hopes it will put Glass at the forefront of the "smart eyewear market".

But many remain sceptical about its future as a mainstream device.

Glass is a piece of wearable technology that includes a thumbnail-sized screen above the wearer's right eye to view internet content. The gadget also includes a camera that can take hands-free pictures and video.

Combining Luxottica's well-known brands with "the cutting edge technology expertise of Google" could "give birth to a new generation of revolutionary devices", said the eyewear company's chief executive Andrea Guerra.

"The first collection generated by this partnership will combine high-end technology with avant-garde design," he added.

Google is to use the 5,000 stores that Luxottica runs in the US to help sell Glass once the device is released on the general market.

There were no details about price or availability.

Cheaper version

Critics point out that Glass remains beyond the reach of many consumers with its $1,500 (£900) price tag.

"The price needs to come down and I think that when they launch a consumer device it is going to be much cheaper," said Nitin Bhas, a senior analyst with Juniper Research.

But he thinks tie-ups such as these will also be crucial.

"Google needs multiple frames to make Glass look more stylish and move it beyond the tech-savvy audience," he said.

IDC analyst Francisco Jeronimo added: "Nobody will pay $1,500 for this type of device."

He estimates Glass will fall to between £300 ($495) and £500 and come with additional features.

Mainstream hopes

It is not the first time that Google has attempted to get interest in Glass beyond its core geek audience.

In January it announced that versions of the headset would be available in prescription glasses and sunglasses - known as the Titanium collection.

Google has so far only sold Glass to a select group of test subjects known as "Explorers." More than 10,000 people have bought it to date.

As early adopters, they have not always had an easy ride when wearing the device with some wearers earning the dubious title "Glassholes".

Cecilia Abadie was pulled over and given a traffic ticket for wearing the device while another user was removed from a cinema and accused of using the gadget to illegally copy the film.

Recently Google issued guidelines on Glass etiquette, urging wearers not to be "creepy or rude (aka a 'Glasshole')".

Last week it attempted to dispel "Glass myths" including privacy fears.

"If someone wants to secretly record you, there are much, much better cameras out there than one you wear conspicuously on your face and that lights up every time you give a voice command, or press a button," it said.

Google appears to be committed to next-generation wearables.

Last week, it unveiled a version of its Android operating system designed specifically for such devices.

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China wants explanation on US spying

24 March 2014 Last updated at 09:23

China has demanded a clear explanation from the United States following reports that it infiltrated the servers of the Chinese telecoms giant, Huawei.

The company said it would condemn the invasion of its networks if the reports in the New York Times were true.

The newspaper quoted documents, allegedly from the US National Security Agency (NSA), released by the former contractor, Edward Snowden.

They said the NSA had spied on Huawei and had information on its customers.

The NSA has made no mention of the reports but said it focused only on what it called valid foreign intelligence targets.

It said it did not use intelligence to steal the secrets of foreign companies to help US businesses.

Chinese foreign ministry spokesman, Hong Lei, said China was extremely concerned about the allegations.

"China has already lodged many complaints with the United States about reports of its espionage activities," he said demanding that Washington cease its activities and explain itself.

The New York Times said one of the goals of the US operation was to find out whether Huawei had connections with the People's Liberation Army.

It said the operation, codenamed "Shotgiant", also sought to conduct espionage through the systems and telephone networks that Huawei sold to other countries.

The newspaper said that the NSA had gained access to Huawei headquarters in the southern Chinese city of Shenzhen and found information on the internal workings of its switches and routers.

The German magazine, Der Spiegel, also citing what it said were NSA documents from Edward Snowden, said the US was positioned to launch cyber offensive operations against the Chinese leadership through its access to Huawei networks.

Washington has long seen Huawei as a potential security threat and has blocked some business deals in the US for fear that it would open the door to Chinese military hackers.

Edward Snowden fled to Hong Kong last year and has since been granted asylum in Russia.

He continues to release information that claims to reveal the global activities of the NSA.

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New tool to help catch child abusers

24 March 2014 Last updated at 00:43 By Mark Ward Technology correspondent, BBC News

Victims of child sexual abuse could soon be identified more quickly thanks to law enforcement agency work on a cloud-based archive of abuse material.

The database has been created to help investigators cope with the vast amount of images abusers typically amass.

It will help police forces quickly check images seized in raids and spot those showing children not seen before.

Forces in the US, UK, Canada, New Zealand and Australia are helping test the database.

Finding victims

Called Project Vic, work on the archive is being co-ordinated by the US Department of Homeland Security and the International Centre for Missing and Exploited Children.

James Cole, a national programme manager at Homeland Security, said the project grew out of the realisation that there was huge duplication of effort among those investigating abusers and the material they trade.

That problem was particularly acute in the US where there were tens of thousands of local police forces and jurisdiction on some crimes shared across local, state and federal agencies.

"We have issues with deconflicting investigations and also big issues with the amount of data that we are seizing," Mr Cole told the BBC.

Across all the crime categories it investigates, Homeland Security seizes "petabytes" of data every year, he said, adding that it was a signature trait of abusers that they amassed large collections of images and videos.

The Project Vic approach uses technologies and software from companies such as Netclean, Hubstream and others to allow investigators to categorise known material. This allows them to concentrate on never-seen-before material and produce a unique summary or "hash" for each new item, said Mr Cole.

"The idea is to allow law enforcement to run data against hash sets that are immediately available through cloud services," he said. "They can interrogate that data in real time and know a lot of things about it very quickly."

Project Vic is also seeking to promote and get backing for a new standards-based image formatting system. This would generate hashes using an open protocol and should make it straightforward to exchange comprehensive sets of hashes domestically and internationally without having to touch or manipulate the data.

Finding unique images more quickly would help police and other agencies focus on victims and material that had never been seen before, said Mr Cole.

"When material is produced you hope to trace it back to an offender and stop them producing or having further opportunities to exploit the child," he said. "We are making great strides in how we do that."

Rich Brown from the International Centre for Missing and Exploited Children, said Project Vic would help work being done globally to tackle abuse crimes.

"Project Vic represents the largest movement of its kind to change the way investigators approach this crime set," said Mr Brown.

Among abusers, material had become a kind of currency, said Mr Cole.

"In well over 90% of our cases there's no money changing hands," he said. "It's the material itself that is highly desirable for offenders. Money does not come into play."

New material has the highest value among abusers and it was incredibly useful to spot it so investigators can focus their efforts on it and work towards freeing victims, he said.

"The way we identify and rescue these children is by putting all that related information together," he said.

Unfortunately, he added, there were also cases in which investigators made little headway and just had to watch victims grow up among abusers.

"Sometimes," he said, "the clues are just not there."

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Dotcom's Mega to list on NZ market

25 March 2014 Last updated at 13:02

Internet tycoon Kim Dotcom, whose site MegaUpload was shut down by US authorities in 2012, has announced plans to list his new file-sharing firm on the New Zealand stock market.

In January 2013, a year after the closure of MegaUpload, he set up Mega, which also allows users to host and share large files on the internet.

He is currently fighting extradition to the US over charges of copyright infringement on a "massive scale".

An extradition hearing is set for July.

'Rapid growth'

Mega will reach the market by using what is known as a "backdoor listing".

Continue reading the main story

We don't cry ourselves to sleep"

End Quote Kim Dotcom Mega

Rather than floating in its own right, Mega will take over TRS Investments - which is already listed - and change the company's name and operations.

TRS will issue Mega with 700 million shares at 30 cents each, totalling NZ$210m ($180m; £109m). Mega's shareholders will own 99% of the firm.

Mega's chief executive Stephen Hall said he intended Mega to be a listed company by the end of May.

"The rapid global growth of Mega has generated significant interest from potential investors," he said.

"Listing on the New Zealand Stock Exchange will allow investors to participate in the ongoing growth of Mega," he said.

'Basic errors'

Mr Dotcom was arrested at his mansion near Auckland, New Zealand, in January 2012. As well as MegaUpload being shut down, Mr Dotcom's assets were frozen.

But later scrutiny of the raid led to New Zealand Prime Minister John Key apologising to Mr Dotcom for what were described as "basic errors" by intelligence services in collecting information on behalf of the US.

Opposition parties called for further independent investigations.

Following the Mega stock market announcement, Mr Dotcom wrote on Twitter: "Indicted. Raided. On Bail.

"All assets frozen without trial. But we don't cry ourselves to sleep. We built #Mega from 0 into a $210m company."

US authorities accuse him of earning more than $175m by facilitating the distribution of pirated copies of movies, TV shows and other content.

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Twitter #music pulled from App Store

By Del Crookes
Newsbeat reporter

Twitter has announced that it is closing its #music discovery service.

In a statement on the social network, it said: "Later this afternoon, we will be removing Twitter #music from the App Store. If you have the app, it will continue to work until April 18.

"We continue to experiment with new ways to bring you great content based on the music activity we see every day on Twitter."

The move was first rumoured last October by some American websites.

Continue reading the main story

We continue to experiment with new ways to bring you great content based on the music activity we see every day on Twitter

Twitter Music statement

The #music service was launched last year after Twitter bought the We Are Hunted music discovery app, originally launched by an Australian music start-up.

However, the music-sharing product ran into trouble a week after it launched when founder Kevin Thau left the company.

After an initial surge in downloads, by October it had dropped to 165th place in the free music apps category on iTunes, according to AppData.

The #music app gave users artist and song suggestions based on who you followed on the micro-blogging site.

Followers could also stream tracks in-app through other services such as Spotify and iTunes.

It's thought Twitter is trying to integrate music into its core service rather than through a separate app with Bob Moczydlowsky now in charge of the firm's music team.

Last month, it partnered with music industry company 300 Entertainment to share music data.

The company also signed a deal with Apple last year to produce a trending playlist station for iTunes radio and already adds playlists to Rdio, another online music service.

Follow @BBCNewsbeat on Twitter

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Turkish tweets from hidden networks

24 March 2014 Last updated at 13:17 By Zoe Kleinman Technology reporter, BBC News

The Turkish government is "fighting a losing battle" in banning social media network Twitter, experts have said.

Locals continue to tweet via virtual private networks (VPN), anonymous web browser Tor and text messages, said security expert Rik Ferguson.

VPN Hotspot Shield reported a rise in iPhone and Android downloads of over 33,000% in the 24 hours after the ban.

The ban was enforced after allegations of government corruption were shared on the site and not removed by Twitter.

Twitter itself has not commented on the situation but it did post instructions in both English and Turkish explaining how to tweet via text message, which requires no internet access at all.

Ryan Holmes, chief executive of social media manager platform Hootsuite blogged that the firm had experienced three times more traffic than usual from Turkey following the ban.

'Book burning'

The US Department of State has described the act of internet censorship as "21st Century book burning".

"Turkey has nothing to fear in the free-flow of ideas and even criticism represented by Twitter," wrote Doug Frantz, Assistant Secretary of Public Affairs, in a post on the department's official blog.

"Its attempt to block its citizens' access to social media tools should be reversed."

Initially the ban took the form of domain name settings (DNS) redirection, in which users typing in a particular website address are instead redirected to a holding page.

Twitter users were able to circumnavigate the ban simply by using Google's DNS service, typing in Twitter's IP address, a number, rather than spelling out the website address "Twitter.com", and changing some of the basic settings of their internet service provider, said Rik Ferguson, vice-president of security research at Trend Micro.

"It's a bit like choosing which phone book you're going to use," he told the BBC.

"Trying to block communications via the internet is nigh on impossible unless you pull the plug entirely."

Hidden surfers

However now the relevant IP addresses are also being blocked, and so is Google DNS, people in Turkey are increasingly turning to VPNs and anonymous web browser Tor to get online without revealing their location.

It is less complicated than it sounds, Mr Ferguson added.

"VPN requires knowledge and financial investment in the form of a subscription," he said.

"Tor has a reputation of being this complex beast, but that's not strictly true - all you need to do is download the browser bundle."

Ultimately Twitter must abide by the laws of the countries in which it operates, said Mr Ferguson.

"The [Turkish] government is now hopeful about talks with Twitter but the nature of social media is that it's very fluid," he said.

"Who's to say that something is removed and then something else pops up in its place?"

Twitter also faced a dilemma over what to do with the offending content if it did decide to act, he added.

"Do you remove the content entirely or make it inaccessible in the country where it is illegal? If you are deleting content entirely that falls more into the realms of censorship than legal compliance."

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Thousands make selfie donation error

25 March 2014 Last updated at 00:06 By Dave Lee Technology reporter, BBC News

Thousands of pounds donated as part of the "#nomakeupselfie" craze were sent to Unicef instead of Cancer Research UK by mistake, the BBC has learned.

More than £8m has been raised after the craze of taking a self-portrait with no make-up spread virally.

But those texting "DONATE" rather than "BEAT" found their money sent to the wrong charity.

Others accidentally enquired about adopting a polar bear from the World Wildlife Fund (WWF).

UN agency Unicef told the BBC that so far £18,625 has been identified as being accidentally pledged.

It said it was now working with Cancer Research UK to transfer the funds donated so they can be used as intended.

Mike Flynn, director of individual giving at Unicef UK, said it was a "genuine mix-up".

"Unicef believes this error has occurred due to those interested in donating to the #nomakeupselfie campaign sharing the text keyword 'DONATE' - rather than the keyword 'BEAT' - and the text number 70099, which has then been repeated across social media.

"'DONATE to 70099' is an SMS keyword and shortcode combination that Unicef have sole use of, specifically for any members of the public who contact us and wish to donate to us via SMS."

He added: "Unicef is not responsible for this error however we've been working hard to find a resolution to the situation for those affected.

"We contacted Cancer Research [UK] as soon as we became aware of what was happening. Unicef and Cancer Research [UK] have agreed that these donations will be received in full by Cancer Research [UK].

"We are now working closely with all parties involved to ensure that this doesn't happen again in the future."

Adopting polar bears

The #nomakeupselfie craze has taken social media by storm since flourishing last week. Its origins are unclear, but since going viral the trend has raised more than £8m for Cancer Research UK and other cancer charities.

But it has not been without mishaps for some well-meaning selfie takers.

As well as the Unicef mix-up, the World Wildlife Fund (WWF) acknowledged that it too had accidentally received text messages due to the wrong keyword.

Some people's smartphones had autocorrected the word "BEAT" to instead read "BEAR".

"Thank you for choosing an adorable polar bear," the reply from the WWF said. "We will call you today to set up your adoption."

The autocorrect blunder surprised many who took to Twitter to joke about their adoption news.

"Just told Jamie to text 70007 for cancer and he accidentally sent bear," wrote Twitter user @ChrisKirk07. "Now he's got two polar bears."

The WWF said no money was taken from people who had sent the texts.

"Any texts sent to us instead of Cancer Research [UK] would not result in any donations going to help protect polar bears as WWF relies on human operators calling people back to confirm adoptions, so no money would have changed hands," said Kerry Blackstock, WWF's director of fundraising.

"When we realised there was a lot of interest in a campaign we weren't presently running we made sure our automatic text message response let the sender know their text had gone awry.

"We wish Cancer Research UK every success in their campaign and their goals, polar bear selfies are harder to come by, though, as far as we are aware, none wear make up."

Follow Dave Lee on Twitter @DaveLeeBBC

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Ethiopia 'spies on telecoms traffic'

25 March 2014 Last updated at 11:43

Ethiopia's government is using imported technology to spy on the phones and computers of its perceived opponents, a Human Rights Watch report says.

The New York-based rights group accuses the government of trying to silence dissent, using software and kit sold by European and Chinese firms.

The report says the firms may be guilty of colluding in oppression.

An Ethiopian government spokesman, quoted by AFP, dismissed the report as a part of a smear campaign.

Continue reading the main story

Security officials have virtually unlimited access to the call records of all telephone users in Ethiopia"

End Quote Human Rights Watch

"There is nothing new to respond to," Ethiopian Information Minister Redwan Hussein told the agency.

Human Rights Watch (HRW) says its report is based on more than 100 interviews with victims of abuses and former intelligence officials, conducted between September 2012 and February this year.

Rights groups frequently accuse the Ethiopian government of cracking down on opposition activists and journalists.

The government denies the claims.

'Overseas surveillance'

All phone and internet connections in Ethiopia are provided by a state-owned company. According to HRW, this has given the government unchecked power to monitor communications.

"Security officials have virtually unlimited access to the call records of all telephone users in Ethiopia," the report said. "They regularly and easily record phone calls without any legal process or oversight."

Recorded conversations are also alleged to have featured in abusive interrogations of suspected dissidents.

The technology used by to monitor the communications is said to have been provided by companies based in China, the UK, Italy and Germany.

"The foreign firms that are providing products and services that facilitate Ethiopia's illegal surveillance are risking complicity in rights abuses," HRW's business and human rights director, Arvind Ganesan, said.

According to the report, the government has extended its surveillance to Ethiopians living overseas.

Ethiopians living in the UK and the US have accused the authorities in Addis Ababa of planting spy software on their computers.

Both countries have been urged to investigate the claims, on the grounds that they may have violated domestic laws against invasions of privacy.

HRW says the firms that sell surveillance technology to governments also have a duty to ensure that their products are not helping to suppress human rights.

"The makers of these tools should take immediate steps to address their misuse," Mr Ganesan said.

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HTC flagship phone gets depth sensor

25 March 2014 Last updated at 15:15 By Leo Kelion Technology reporter

Please turn on JavaScript. Media requires JavaScript to play.

Rory Cellan-Jones tries out the new HTC One handset

HTC's new flagship Android smartphone features a depth sensor to let owners change what appears in focus in photos after they are taken.

The HTC One (M8) also features a bigger screen and louder speakers than the previous model.

The company said the device should turn around recent weak earnings and help it recover market share.

But experts said Samsung and Apple's bigger marketing budgets would continue to put HTC at a disadvantage.

The Taiwanese company only shipped 6.4 million units of the original HTC One model last year, according to the research firm IDC.

That compares with 43.3 million shipped copies of Samsung's Galaxy S4 and 39.5 million shipped units of Apple's iPhone 5S, which also launched in 2013.

Across its portfolio as a whole, HTC actually sold fewer handsets in 2013 than 2012 despite growth in the wider market.

"This is a make or break device for HTC," said Ben Wood, chief of research at tech consultancy CCS Insight.

"Although last year's HTC One was widely considered the best smartphone of 2013, the company failed to capitalise on this."

Photo effects

One of the new handset's distinguishing features is a sensor on its back used to record distance.

The information is used by an app to allow the owner to mimic the effect of changing focus after a photo is taken, keeping selected objects sharp but blurring others.

It also allows users to add stylised effects to a photo's background while keeping its main subject unaltered.

Another innovation is the ability to activate the phone without having to press its on-button. Swiping the screen in different ways takes the user to either what they were last doing, the home screen or a feed of news stories and social media updates.

Continue reading the main story

The following figures are for the calendar year of 2013 and are based on shipments:

1. Samsung - 31.3%

2. Apple - 15.2%

3. Huawei 4.8%

4. LG - 4.7%

5. Lenovo - 4.5%

6. Coolpad - 3.7%

6. Sony - 3.7%

8. ZTE - 3.6%

9. Nokia - 3.0%

10. HTC - 2.2%

11. Blackberry - 1.9%

12. Others - 21.2%

Source: IDC

The company also boasts that battery life is 40% better than before even though it has a bigger, 5in (12.7cm) screen.

However, it lacks a fingerprint scanner despite the firm's inclusion of the security feature on the One Max handset.

Production problems

Despite winning several awards, sales of the original HTC One underperformed.

The firm said that part of the problem was production delays caused by its use of a unibody metal case and a new type of camera.

"We just didn't educate our vendors to do the mass-production well," Cher Wang, the firm's co-founder, told the BBC.

HTC's chief financial officer added that this caused a consumer backlash rather than the positive word-of-mouth effect hoped for.

"The first wave of people is actually quite important - they tend to be most vocal," said Chia-Lin Chang.

"They were waiting and couldn't get it and had to vent, and that's unfortunate.

"But I'm glad to say this year that will not happen because you will see availability right away."

He said several stores in the UK and US had already been provided with stock and the phone should become available across most of the globe within two-and-a-half weeks.

Ambitious targets

HTC is also changing tack with its marketing campaign.

The firm signed Hollywood actor Robert Downey Jr to a two-year deal in 2013, reportedly for $12m.

The initial ads, in which the star suggested the firm's initials could stand for "hipster troll carwash" or "Hungarian tuba concert", faced criticism for focusing too much on HTC's brand rather than its products.

"This year we [will be] more direct, so the customer will understand our phone much better," said Cher Wang.

Mr Wood said that HTC still had "a mountain to climb", but appeared to have learned several lessons.

"Rather than a two-month lag from launch to shipment, the new HTC One is available immediately," he said.

"This means it hits the shops ahead of new devices from arch-rivals Samsung and Sony.

"And although HTC can't get close to Samsung's colossal marketing budget, its marketing campaign is significantly more focused than last year's launch."

Mr Chang said HTC hoped to grow its market share to over 5% by the end of 2014 and 10% within three years.

But IDC suggested the targets could prove difficult.

"HTC is being squeezed at the high-end by Apple and Samsung and a market that isn't growing, and in the expanding mid-to-low end by Chinese vendors such as Huawei," said analyst Francisco Jeronimo.

"Without large financial resources it will find it hard to promote its portfolio. But the one thing it has in its favour is very good hardware and industrial design."

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