Microsoft is lowering the price of Windows Vista, suggesting that people are becoming less likely to shell out big money for software when so much more computing is done through online sources.

Admittedly, the vast majority of us are not on Linux at this point and likely won’t be anytime soon, but there are signs the market for software is starting to decline. With more open source and ad supported applications flooding the Internet, particularly from Google, Microsoft needs to be proactive to alter its business model for the future. It’s not a crisis yet, but it’s in the mail.
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In an effort to reach out to the community and help a lot of people get back on their feet, Google is providing the homeless population of San Francisco with a free lifetime phone number and voicemail box. This will allow them receive messages from potential employers and actually have a phone number they can put down on a job application.

One of the biggest hurdles in making a transition from life on the streets and in shelters to a more normal existence is the ability to communcate and receive messages from employers, landlords, government offices, etc. Providing a free phone number and free voice mail could make the difference in hundreds of people’s lives in San Francisco.
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European Union anti-trust regulators hit Microsoft for $1.35 billion fine today, claiming the company violated its 2004 anti-trust agreement regarding the market dominance of Windows.

“The high penalty payment can only be understood as a reaction to a behavior by Microsoft, which the commission interpreted to be a blatant circumvention of the rules it imposed, and as a strong signal that — under such conditions — the commission will go close to the limits in order to provide for effective deterrence,” said Heike Schweitzer, of the European University Institute in Florence.
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While more and more people are utilizing search engines every month, comScore reported Google’s number of sponsored clicks have flattened out recently, which led Google’s stock to tumble as much as 8% in trading today.

This information is adding fuel to the fire that suggests Google is not recession-proof. As shoppers are more wary about spending their money, Google’s ads are not being clicked on and this is not good news for their ad business.
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Instead of only paying advertisers on a pay-per-click basis, Microsoft is proposing a new method of measuring the effectiveness of ads. Instead of per click, Microsoft will find a way to measure the “engagement” of an ad based on whether or not the user responds down the road to it.

Here’s how it works: if you see an ad for Netflix while you’re reading the New York Times, but don’t click on it immediately, the Times can still get paid for that ad down the road if the user eventually clicks on a Netflix ad. Microsoft will measure how many times you’ve seen the ad, and then reward the first or second server of that ad for an eventual click.
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Because of content deemed “offensive to Islam,” Pakistan has ordered its Internet service providers to block YouTube from being accessed in Pakistan.

Turkey and Thailand have also temporarily blocked YouTube because of content those countries find offensive. It’s not known if these will be temporary or are permanent.

Apparently in Pakistan, a trailer for a new film by Dutch filmmaker Geert Wilders where Islam is portrayed in a negative light was the impetus behind the ban, not to mention the continued presence of Danish cartoons that portray Mohammed in a negative light.
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As we reported earlier this week, Facebook’s number of visitors is leveling off in the UK. However, a new report shows the same phenomenon occuring in the United States as Facebook’s page views dipped slightly between December and January. A similar dip occurred last year around the same time, so this isn’t unprecidented.

There are a variety of potential explanations for this floating around. One possibility is that colleges were on winter break so students went back to home to their parents’ mud huts that apparently don’t have the internet. It seems to me that with all that time on your hands, Facebook would get more hits.
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comScore has released search engine rankings for January, and there is very little change from the results from December.

Google still leads the pack by a wide margin, with 58.5% of total American searches, but only added .1% of market share over the month. Yahoo, with 22.2% of total seraches, declined a fairly hefty .7% from December.

All search engines reported jumps in usage from the previous month, and where Yahoo lost market share, AOL and Ask.com appear to have gained. Ask.com’s queries jumped 14.6%, while AOL’s increased at a 16.5% clip.
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For the first time, Facebook’s number of unique UK users fell between December and January. The 5% decline was the first following 17 consecutive months of growth, and wasn’t unique to Facebook. MySpace users declined as well, as did Bebo.

Facebook shouldn’t be too concerned, as the number of UK users has jumped a whopping 700% in the last year, but it could point to social networking fatigue. It seems as though for many people, sites like Facebook and MySpace are fun for awhile, but the thrill wears off in time because the social networking aspects of the site aren’t as useful as they are fun.
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CNET’s Ina Fried has an excellent article on her blog today about the potential Yahoo/Microsoft merger.

Bill Gates has revealed that the prime motive for valuing Yahoo at over $40 billion is not its search engine, it’s ad revenue, or its status as start page to millions, but in its engineering talent.

Gates revealed that if anyone is to take on Google, they will need to pool their engineering and technical resources. “The amount of computer science it is taking to do that is phenomenal,” he said. “As you get more scale of engineering you can just pursue that agenda more rapidly. Yes, the advertisers and the number of end users is good, but we’d put the people and the engineering as the key thing.”
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