Beyond Binary

Palm showed the Palm Pre's rival to the App Store during its demo at D: All Things Digital on Thursday.

(Credit: Ina Fried/CNET)

CARLSBAD, Calif.--In one of the more anticipated chats at D: All Things Digital, Palm Executive Chairman Jon Rubinstein showed off the Palm Pre and talked about several features of the smartphone for the first time.

Rubinstein showed how the device can search Amazon's MP3 store and download songs directly to the device, a feature mentioned at the Pre's unveiling at CES in January. The Pre is scheduled to go on sale June 6 with a price tag of $199.99, after rebate.

He also showed a "media sync" feature that lets users grab nonprotected media files directly from iTunes without any special software. In addition, the universal search feature will not only search Google and Wikipedia, but also Twitter.

Palm also demoed an App Catalog that the company says will launch with the product in beta form. About a dozen programs will be there at launch, Palm said. Among the applications shown on the device were Fandango and the New York Times.

D impresario Walt Mossberg pressed Rubinstein on whether iTunes maker Apple will be unhappy with the feature. "They've gotten much more open," he said. "They've gotten rid of the DRM."

Venture capitalist Roger McNamee, whose firm is Palm's biggest shareholder, said he sees the media sync feature as an acknowledgment of iTunes' power.

"I find it hard to believe they are going to get bent out of shape," McNamee said.

Rubinstein did acknowledge that the Pre is going after the Apple iPhone, along with the BlackBerry devices from Research In Motion.

"Clearly the primary competitors are Apple and RIM," Rubinstein said of the Pre.

Palm: "a new company today"
Before the Pre demo, Rubinstein talked about the steps that got the company where it is.

"We hired a lot of new people into the company," Rubinstein said. "It's a new company today."

Asked what he brought over from Apple, where he had been a hardware guru, Rubinstein said, "I hope I've learned a little bit of taste. I've also learned how important great marketing is."

But Palm is not Apple, he said. "The difference is we're tiny. We're the real little engine that could."

McNamee said that, despite all their success, Apple and RIM have just two points of market share in the global phone business. "We are at the very beginning of a massive transformation," he said. "There was a lot of white space that Palm could step into."

Mossberg asked why Rubinstein and McNamee didn't just start their own company.

"Palm had tremedous assets," Rubinstein said, noting its brand, its history of innovation, and its intellectual property. "The DNA is there," he said. "The way of thinking about great products is there."

The talk began with a video in which McNamee makes all sorts of exaggerated claims about the Pre and Rubinstein constantly interrupts and corrects him. It's a reference to an earlier incident in which McNamee made claims that Palm later had to publicly disavow in a regulatory filing.

McNamee didn't stop with his hyperbole.

"I wish I had the entire fund in Palm," he said. " This is the thing that will define us."

Long live the OS
Asked about what other devices Palm might create, Rubinstein left the door open, but didn't give details.

"We designed the WebOS to work across a variety of products," Rubinstein said. A lot of thought was put into the WebOS that powers the Pre, he said.

"The old Palm OS lasted 15 years but had run its course," Rubinstein said. "We set out to develop a platform that will last us another 10 or 15 years."

Rubinstein said that Palm initially worked with just a couple dozen developers, but is now working with hundreds and has thousands more waiting in the queue.

As for the devices themselves, Rubinstein was asked to comment on reports that Best Buy stores may each have only four devices for launch.

"We are in full production with the Pre," Rubinstein said, adding that he expected there would be shortages because of the demand.

He noted that later this year there will be a GSM version, but declined to confirm a report that Verizon will start selling the Pre in six months time.

"We do love Sprint and they are our exclusive launch partner," Rubinstein said. "It sounds like AT&T and Verizon both want it. I can't comment on unannounced relationships."

On the enterprise side, Rubinstein said, the Pre not only has ActiveSync to get Exchange mail as well as the ability to look up addresses from a corporate directory and remotely wipe a lost phone. He also acknowledged that the security and other business features of Windows Mobile aren't there, pitching those concerned with that toward Palm's Windows Mobile-based Palm Pro.

Among the Pre featues, Palm showed a media-synching feature that transfers unprotected music directly from iTunes.

(Credit: Ina Fried/CNET)

CARLSBAD, Calif.--Although it has managed to grab nearly a quarter of the browser market, Mozilla now finds itself in an unenviable position--competing against Microsoft, Apple, and Google all at the same time.

Speaking at D: All Things Digital on Thursday, Mozilla's Mitchell Baker noted that the company didn't set out with that in mind.

"That's not the business model you are going to pick," Baker said. "It is a daunting space to compete with the three giants of the era."

That said, Baker and fellow Mozilla executive John Lilly said there is still a place for Firefox.

"We've just got to be us," Lilly said. "Mozilla has always been about scratching an itch."

Another challenge, Lilly said, is that people don't perceive the browser as something that changes their Web experience. "Most people just think it's this pane of glass," Lilly said. Three quarters of people use the browser that comes with their computer, he said.

But browsers are important, Lilly maintained.

"We spend more time with our browser than we do in our cars," Lilly said. "The real truth, I spend more time with my browser than I do with my family."

Arianna Huffington and the Washington Post's Katharine Weymouth discuss the future of journalism at D: All Things Digital in Carlsbad, Calif.

(Credit: Ina Fried/CNET)

CARLSBAD, Calif.--The Washington Post publisher Katharine Weymouth on Thursday tried to put the best face on the changes that have battered the newspaper industry.

"There is no doubt we have our challenges," Weymouth said, appearing on the D: All Things Digital stage along with Arianna Huffington. "We are going through this incredible seismic shift in the industry."

At the same time, she noted that 90 percent of The Washington Post's Internet traffic is outside he Washington Post, presenting the paper with an opportunity that didn't exist in print.

"We have to adapt," she said. "We can put our head in the sand and hope it all goes away or we can move. We're moving."

That hasn't helped avoid the financial impact though.

"We're losing money," she said. That's not something she is proud of. At the same time, she said the company is working on finding new areas that could be profitable down the road, such as working with Google to develop a news product--as well as offering the Post on devices like the iPhone and Kindle.

As for the Huffington Post, Weymouth said it drives a lot of traffic to The Washington Post's Web site. But, it also represents a challenge.

"We need to learn from what the Huffington Post does," she said. "We can learn from Drudge, from Politico."

For her part, Huffington offered a backhanded compliment to the print medium.

"I personally happen to love reading newspapers," she said. "It may be my age."

Moderator Kara Swisher noted the difference in size between their two newsrooms. Huffington said she had about 60 reporters and editors, as opposed to the Post, which has shrunk its newsroom staff, but still has 800 people creating the content.

Later though, Weymouth noted that the paper had a newsroom staff of around 375 people when it covered Watergate.

Huffington said, as she did before Congress recently, that the push to save newspapers is misguided and should be a conversation on preserving good journalism. She said the newspapers' plea for help reminds them of the auto industry's request at the beginning of the decade to relax environmental standards as opposed to working to transform themselves.

Weymouth said that she isn't asking for any handouts. "We are a business and we will return to profitability," she said. "We're a business. We need to be a business. That's what makes us great."

Swisher pointed out that Huffington isn't making money either.

"We are breaking even," she said.

She said her focus is on advertising revenue. Huffington said that subscriptions online only work for porn and "really weird" porn at that.

As for journalism, Huffington said that the industry has focused too much on writing stories as if every issue has two equally valid perspectives.

"Very often truth is on one side or the other," She said. "That's not partisanship."

CARLSBAD, Calif.--NBC Universal's chief executive said the changing economics of television means that networks have to change the way programming is done.

There's room for hits and there's room for inexpensive programming, Jeff Zucker said Thursday, speaking at the D: All Things D conference.

"What's gone is the middle," Zucker said. "You cannot sustain just average programming."

NBC Universal CEO Jeff Zucker

(Credit: Ina Fried/CNET)

That also means shows have less time to mature, he said. Zucker noted that "Seinfeld" would probably not make it in today's environment, noting it did just so-so in an initial four-episode summer run.

"That doesn't happen anymore," he said. "It would be gone."

Zucker said that doesn't mean the era of hit shows is over. "There can still be hits in network television," Zucker said. "They don't last as long."

Asked about the fact his network is in third place, Zucker said that's obviously not where he wants to be. "We haven't done a good enough job of creating programs that people want to watch," Zucker said.

Broadcast is more challenging than cable, he said, because it only has advertising as a revenue stream. Another change, Zucker said, is that broadcast networks used to show episodes multiple times. Now the reruns are on Hulu and other places.

"We're at our core a cable company," Zucker said. Sixty percent of its cash comes from cable, he said. "The cable model is just a better model."

As for the economy, he said, "There is some light at the end of the tunnel."

Asked about Hulu, Zucker said it is ahead of plan and should be cash-flow positive soon. "The first 18 months was getting it up and not getting laughed at," Zucker said. "The goal over the next 18 months would be increased monetization." Hulu is a Web video service from NBC Universal and Fox Entertainment Group.

Zucker was also asked about his well-publicized spat with iTunes.

"We've always loved Steve," he said, referring to Apple CEO Steve Jobs. "It wasn't personal." But Zucker said NBC didn't agree that a library copy of the "Rockford Files" should sell at same rate as a new episode of "Battlestar Galactica." "The pricing wasn't fair."

"About a year later, Steve decided he was open to tiered pricing," Zucker said. He noted that 15 percent of NBC content sells at $2.99, the price consumers pay for HD content on iTunes.

Zucker said that iTunes, Hulu, and other digital businesses are small individually for NBC. "You do have to have 10 businesses like this that make up for the one you've lost."

He has said that the industry is replacing analog dollars with digital pennies. "I was just trying to be honest. I don't regret it at all because it was the truth."

"What I have said is we are now up to digital dimes. I think that's progress...We still have a 90-cent gap. Hopefully I can come back and in a year or two we will be at digital quarters. The more people understand where we are, the better," he said.

Zucker was asked whether he would put his shows on Facebook. "We'll put our shows anywhere, frankly. We want to be paid for it. That's what will allow us to keep producing shows like "The Office" and "30 Rock." If we can't get paid for them, we can't afford that cost structure."

As for teaming up with rivals on Hulu, Zucker said he wasn't worried about antitrust issues. "Half the day we spend bashing each others' heads in. Half the day we spend in business together."

Zucker said it is important for the industry to embrace technology so as not to end up where the music industry did. "I don't think you can put the genie back in the bottle." He said that if the company tried to air its content only on its network, people would find more ways to pirate the shows.

"You can't stop progress," he said.

Asked about Hulu's efforts to keep its service off TV sets, Zucker said: "Right now we are committed to Hulu being an online experience. That's where our vision is today. That will continue."

Note: CNET News is published by CBS Interactive, a unit of CBS.

Microsoft CEO Steve Ballmer, on stage at D: All Things Digital with Walt Mossberg, introducing the company's revamped search engine, dubbed Bing.

(Credit: Ina Fried/CNET)

CARLSBAD, Calif.--Microsoft CEO Steve Ballmer kicked off his speech Thursday talking about the economy, though he also plans to show off Microsoft's revamped search engine within minutes.

In a speech at D: All Things Digital, Ballmer was asked by moderator Walt Mossberg to discuss the economy and how long the downturn will last. Ballmer said that he didn't expect the the economic collapse to be a 50-year-thing, but it won't turn around in three months either. (Thanks for narrowing that down)

"People generally agree this is a different recession," Ballmer said. "To think that things would be back in a year seems naive to me."

Had the economy not tanked, Ballmer said the company's research and sales and marketing would have continued to improve.

"You'll do less new," he said, in today's economy.

Update 8:20 a.m. PT: The talk is turning to search. Ballmer says Microsoft is willing to "upgrade" its talent when necessary.

"We're obviously where we are in search, " he said. "We want to do better, no question." 8:22 a.m. PT: More on search.

"It takes persistence," Ballmer siad. "We certainly flailed with Windows before we got it right,"

Now showing video on the introduction of search. Jokes about their naming plans and failed Yahoo bid.

And it's... BING.

"We wanted something that unambiguously said search," Ballmer said, explaining why Microsoft decided to rebrand Live Search.

8:30 a.m. PT: Ballmer now talking about why Bing. He said the company wanted something that was short, could be used as a verb and didn't have "negative or unusual" connotations.

He put the renaming in context.

"This is a very important step," Ballmer said. "It doesn't substitute for innovation."

Yusuf Mehdi comes on stage to demo Bing.

Ballmer interrupts to position how far Microsoft has come.

"There's no way to just change the whole game in one step," he said. "There's a lot of unmet needs in this category."

8:35 a.m. PT: Demo showing some of the key features. For example, search identifies best match, sometimes hiding other results when there is one clear match that someone is looking for.

Also includes customer service phone numbers when you search for a company like Amazon.com or Microsoft itself.

8:40 a.m. PT: Now showing the main interface of Bing--it's left hand navigation and breaking down of searches by categories. It's a mix of human and computer categorization, Microsoft said.

On the video search site, when you hover over a thumbnail result it starts playing right from the thumbnail.

8:45 a.m. PT:On to product search. Mehdi howing how it includes user and professional reviews gathered from a variety of sites.

Travel search gets integration with the Farecast site Microsoft bought. Farecast helps predict whether current rates and fares will go up or down.

Mossberg hits on one of the questions I raised about all the integration of content from other sites directly into Bing.

"How about all these people that expect to make money off their Web sites," Mossberg asks.

"Were not trying to get in the way of copyright holders," Ballmer said. "We're not trying to live off other people's work. We are just trying to make a good product."

Ballmer notes some of different ways content gets there. Some is licensed he said, other is what can be crawled "under copyright law."

"We license content to be in here," Ballmer said. "That's a way to do it."

8:45 a.m. PT: Mossberg asks Ballmer what makes him think this will do the trick. Ballmer says that phrasing implies things will change overnight, which they won't.

"My timeframe is 'lots of years'" Ballmer said.

Mossberg noted that Ask had an improved engine at one time that gained share after a relaunch, but the gains faded.

"Ask was not consistent," Ballmer said. "They didn't keep pounding and pounding."

8:55 a.m. PT: So how much is Microsoft spending on ads?

"We'll have a big budget," Ballmer said. "It was big enough that I had to gulp when I approved it," he said, adding that a gulp in a $60 billion company is a big thing

8:57 a.m. PT: The talk is shifting to smartphones.

Ballmer, not surprisingly, tries to paint the PC as the more important mobile devices.

"Most wireless data goes over PCs," he said. "It doesn't go over phones."

That said, Ballmer agreed that "smartphones are going to increase like crazy."

He said that 500 million smartphones a year are going to be sold over time. "I want to sell a very significant percentage of all of those through our partners," he said. "That is very important financially to us, strategically to us."

8:59 a.m. PT: The talk turns to Netbooks.

Walt Mossberg notes that the research the conference organizers did shows most people don't plan to buy a Netbook even when the economy improves. Ballmer says that has more to do with "fuzziness" around the Netbook brand. He said the figure would be a lot higher if the question asked how many people plan to by a notebook computer.

9:01 a.m. PT: Windows 7 is "on track" for holiday season.

Mossberg asked about enterprise adoption. Would Windows 7 be faster than Vista?

"Vista was faster than XP, ironically," Ballmer said. "Windows 7 has the potential to be faster still than Vista (in the enterprise)"

9:04 a.m. PT: On to questions. The first one comes from a venture capitalist that sees the new Office "ribbon" user interface as a productivity drain.

Ballmer said that "any time you make any change in the user experience of any thing you are going to have people" that don't like it.

"When they change the (Wall Street) Journal, I always hate it for a while," Ballmer said. "Software has that same characteristic."

9:05 a.m. PT: Next question is on search. User asks whether if he is searching for a "Hilton" in "Paris" he gets the result he wants or, perhaps some other result would come up.

(I'll do that search and let you know what happens).

9:07 a.m. PT:Esther Dyson asks about Microsoft's healthcare business.

Ballmer said that the company is investing in several areas, including business intelligence that can merge together several different electronic health records.

That's important, Ballmer said, because it is unlikely that even as records go digital that people will have just one place where all their health data is stored. "You are going to have several records," Ballmer said.

9:04 a.m. PT:A question on Netbooks and Windows 7. Ballmer says computer makers will be able to use Windows XP as well as many versions of Windows 7.

Have you met with Yahoo recently?

"I think there's a lot that can make sense in terms of a search partnership, not an acquisition," Ballmer said. "Whether such a thing will happen I don't know."

As for a meeting, Ballmer noted that Carol Bartz left a message for Ballmer in a book that the D makeup artist had people sign.

"The makeup couldn't fix me if it tried," Bartz wrote, according to Ballmer.

9:14 a.m. PT: Ballmer's done.

Mark Cuban, speaking Wednesday at the D: All Things Digital event in Carlsbad, Calif.

(Credit: Ina Fried/CNET)

CARLSBAD, Calif.--Mark Cuban says that despite the growth of YouTube, the Internet video market over the last decade has actually been a disappointment.

The problem, he said, is that when Google bought YouTube it focused on ubiquity rather than making money. The result, he said, is that the market can't really sustain itself.

"This is a company that is literally subsidizing the bandwidth for the world," Cuban said, speaking at the D: All Things Digital event. That's a risk, Cuban said, if someone were to ever find a better search business model than Google.

"I think its a real disappointment to see where Internet video has come," Cuban said, noting that the industry still doesn't have advertising standards, among other shortcomings.

Asked why that doesn't sound like a business opportunity, Cuban said, "It's like fighting Microsoft" in the PC business.

"YouTube has gotten so big you are not a standard unless YouTube adopts you."

He gave some credit to Hulu for trying to build a money-making Internet video site.

"Hulu has done some great things and they are focused on monetization," he said, but also added "they have some big pockets that they have to appease."

As he has in the past, Cuban criticized the Internet saying it was "dead," "staid," and generally uninteresting. He likened it to the PC software business after the WordPerfect-Word and other battles had ended.

"It's just a utility," he said.

As for the Twitter guys, he said he is not worried they don't have a business model.

"They can make money," Cuban said. "They are having just as much fun teasing everyone."

MySpace CEO Owen Van Natta and News Corp. digital chief Jonathan Miller (far right) appear on stage with Kara Swisher and Walt Mossberg at D: All Things Digital in Carlsbad, Calif.

(Credit: Ina Fried/CNET)

CARLSBAD, Calif.--MySpace's problem is pretty simple, says former Facebook executive Owen Van Natta, who is now MySpace's CEO.

"If you don't continue to innovate...people are going to shift interest elsewhere," Van Natta said, appearing on stage at D: All Things Digital, along with with News Corp. digital chief (and former AOL executive) Jon Miller. "We need to continue to innovate a lot more rapidly than we have been."

Van Natta said that, on the plus side, MySpace is more open than a lot of its rivals.

"There's a lot of self-expression that is happening," he said. "We need to seize on that."

Van Natta took over as MySpace CEO last month, shortly after Miller was installed to lead News Corp.'s digital efforts.

Kara Swisher asked Van Natta to compare Facebook and MySpace.

"I think they are both driving this notion of social activity on the Webl," he said, but adding there are fundamental differences, such as the role of music and self-expression on MySpace.

Swisher pressed them on whether MySpace can regain lost ground.

"Certainly we're not the darling of the press right now, that's pretty clear," Van Natta said. At the same time, he said the company still has a huge audience if it can deliver compelling features. ""We already have 130 million people that are coming to the site every day."

Miller said that the trick for companies coming from behind is to not focus on checking the boxes of things offered by competitors, but rather to figure out what you need to do to leapfrog those rivals.

Van Natta said that opportunity is part of what attracted him to the job.

"'When I look at MySpace there's just so much to build." Van Natta said, noting that in high school he used to always choose construction jobs because he likes "to build stuff."

Van Natta was asked whether the company's ad deal with Google has paid off. He said it had for them. As for Google, he said, "You'd have to ask Google."

But he said, long-term deals often take work to be mutually beneficial. "Good partners work together to close the gaps."

(Credit: Plastic Logic)

Plastic Logic envisions its e-reader simplifying life for students.

(Credit: Plastic Logic)

CARLSBAD, Calif.--In between the big name CEOs speaking at D: All Things Digital, Kara Swisher and Walt Mossberg also have a few tech companies on stage to show their wares.

A short while ago, electronic book maker Plastic Logic showed off the user interface of its touch-screen reader, which is due out early next year. The interface seemed simple, although the page turns on the prototype seemed interminable.

The company wouldn't reveal pricing, but did say that the device will have both Wi-Fi and 3G wireless, though it did not specify the carrier. As for color screens, they said they have it working in their labs, but it won't be a next year kind of thing.

Currently, the CTO of force feedback specialist Immersion is showing a couple new technologies, including a prototype touchscreen keyboard. When a user presses a key on the soft keyboard they not only see and hear which key they have pressed but can feel it as well.

"It is a very natural experience," said Immersion CTO Cristophe Ramstein. "Sounds are not as profound as touch to give you this feel."

The second demo was what the company is calling "hapticons," essentially adding feel to an electronic message. He sent a love note to Mossberg, with his screen pulsing to a beating heart.

CARLSBAD, Calif.--Nokia's CEO showed off a device on Wednesday that looked every bit as sexy as something from Apple, Palm, or Research In Motion.

The N97 has a large touch screen, built-in cameras, a text-to-speech reader, FM transmitter, 32GB of built-in memory, mapping, and all other kinds of bells and whistles.

The biggest problem, at least for people in the U.S., is that like many Nokia phones, the N97 will only be sold here separate from phone service. That means it is sold unsubsidized, in this case with a $699 sticker price.

However, CEO Olli-Pekka Kallasvuo told the D: All Things Digital crowd that his company is in talks with U.S. carriers in hopes of being able to offer the phone at a lower price.

The device can play Amazon Unboxed videos as well as videos straight from YouTube's site on its 640x360-pixel screen, and even video chat via its second camera, which is on the screen's front. It comes in white and black, Nokia said.

"That was pretty cool," Walt Mossberg said. "I think so too," Kallasvuo said.

Given that, though, Mossberg asked why the company has less than 10 percent share in the U.S.

"What is your problem in the United States," Mossberg said.

Kallasvuo said that the company is working intensely with U.S. carriers. "I think we are getting great traction there," he said, noting that a version of the e71 is now selling on AT&T.

He said it won't be on CDMA carriers such as Sprint or Verizon, but said that T-Mobile and AT&T remain possibilities.

"On Randall, I am working," he said, referring to AT&T CEO Randall Stephenson, who spoke at D earlier on Wednesday.