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Analysts polled by First Call had forecast earnings of 26 cents a share on revenue of $186.5 million.

EarthLink reported on Tuesday lower sales and profits for the second quarter, though its earnings per share passed analysts’ expectations.

Cost cuts aided EarthLink’s bottom line, with total expenses for the second quarter declining to $54.9 million, down 34 percent from 2008’s second quarter. The company has been trying to rein in costs since 2007.

For the quarter ended June 30, the Internet service provider earned $31.5 million, or 29 cents a share, compared with $50.6 million, or 45 cents a share, in the year-ago quarter.

EarthLink also announced that Bradley Ferguson will become its chief financial officier, starting Saturday. Ferguson has been the company’s controller and previously its vice president of commercial finance. Ferguson has been an EarthLink officer since its merger with MindSpring Enterprises in 2000 and was a MindSpring officer before that. Current CFO Kevin Dotts will leave the company in mid-September.

Sales fell 24 percent to $185.6 million from $245.6 million in the year-ago quarter.

“The consistency of our operating performance over the past eight quarters and our confidence that the company’s core business will continue to generate solid cash flow enables us to commence a quarterly dividend program that will return a meaningful amount of cash to shareholders,” EarthLink CEO Rolla Huff said in a statement.

Based on the quarter’s results, EarthLink upped its financial forecast for 2009. It’s looking at adjusted earnings of $235 million to $245 million for the year. That’s up from its previous forecast of $220 million to $230 million.

At quarter’s end, EarthLink had 2.45 million subscribers, compared with 3.3 million at the end of the second quarter last year. That’s a 26 percent drop.

EarthLink, however, was upbeat over customer retention. The company said that the number of subscribers lost in the second quarter dropped to 149,000 from 282,000 lost in the second quarter of 2008. Subscriber churn, which measures the number of people who exit the service over a given period, fell to 3.6 percent in the second quarter vs. 4.3 percent in the year-ago quarter.

Additionally, EarthLink declared the launch of a quarterly cash dividend of 14 cents a share on its common stock.

(via Bing community blog)

Photos are one of the most used parts of Facebook, yet you’ll never find shots that show perspective, or that let you zoom in to see fine details.

Here’s what’s embedded on the Facebook page:

(Credit:
CNET)

Photosynth is Microsoft’s 3Dish photo experience that takes several photos and stitches them together into a landscape that can show an extraordinary amount of detail, as users zoom in and out of high-resolution photos. Late last year, Photosynth became a commercialized part of Microsoft Virtual Earth, after originally existing as a technology preview.

One small hurdle to using the app is that you’re required to manually dig up all the information about the synth, including source URLs, an image thumbnail, and short and long descriptions. These things cannot be automatically sucked in from the Photosynth site, which means that you need to enter them one by one. Luckily, this takes only about a minute per synth, but if you’re a heavy Photosynth user, it can be a real process to insert all your synths.

In the case of this app, it simply embeds a synth for you, and lets your friends both view it and leave you comments as if it were another first-party piece of content on the site.

That’s where SpeakTech has stepped in, with a Facebook application called MySynths. It lets you take any Microsoft Photosynth and share it on Facebook, just as if you were viewing it on the Photosynth site. You and your viewers will, of course, need Microsoft’s Silverlight rich-media technology installed, but for them, there is nothing else to install.

MySynths lets your friends know you just published a new synth, and they can view it without any special software, as long as they have Silverlight installed.

But I see a trend emerging that the Wired article failed to hit on: virtual surgery has a place for gamers, not just professionals. Would I like to try my hand at brain surgery? Absolutely. Learn to mend a broken bone? Of course. And I’m not even (much of) a gamer. I discovered this potential cross-section of surgeons and gamers while watching virtual surgery videos on YouTube, and noticed commenters asking where they could get or play these surgery games.

Yes, this sounds–and might also be–totally ridiculous, but wouldn’t you want to know the virtual surgery score of the person about to open up some part of your body and try to make it all better? That just might mean a lot more than a good reference.

Two possible scenarios–both equally entertaining–might ensue. More gamers will suddenly have useful medical skills at their disposal, while more surgeons will (perhaps inadvertently) hone their “gaming” skills. What if, when looking for a doctor, you could check his or her Surgery Simulator Score?

Also–and this reminds me of the main difference between playing poker on my computer versus at a table–virtual surgery happens a lot faster. With a strong cup of coffee and enough RAM, a surgeon-in-training could perform multiple heart surgeries in virtually (ha ha) one sitting.

A temporal bone surgery simulator at the Ohio Supercomputer Center.

(Credit:
Ohio Supercomputer Center)

Wired weighs in on the ever-improving field of surgical simulators in its August issue. The obvious point of the story is that virtual reality is finally enabling us to take the guinea pig out of trial and error; any mistakes made by those in training will result in a failed grade, or a do-over, as opposed to the possibly nightmarish side effects that come with botched surgery.

Follow me on Twitter @mjasay.

But for now, we may demand to be equals of old-world software businesses but the reality is that very few–Google, and maybe Facebook–companies have figured out how to make a lot of (profitable) money in the new digital economy.

Rochefoucauld-Liancourt noted the progress of this transformation in two telling observations in the 1790s: “They deceive themselves very much who think that pure republican manners prevail in America,” he wrote, pointing out how the citizens painstakingly differentiated between the ranks of society. “In balls, concerts, and public amusements, these classes do not mix; and yet,” he added in amazement, “every one calls himself, and is called by others, a gentleman.”

Reading T.J. Stiles’ excellent “The First Tycoon,” I came across a passage that reminded me of the software industry today. Stiles describes the turmoil and opportunity that greeted Cornelius Vanderbilt, the American shipping and railroad magnate, as he navigated the 1790s, a turmoil that has much to say about our world today:

Sure, Microsoft got away with creating two massive businesses (Windows and Office) by copying its competitors and out-executing, but even Microsoft doesn’t get a free pass anymore. Have you seen how its me-too offerings on the Web have fared? Weak.

It’s not simply open-source revenue models, but also the sorts of products that we build. IBM’s Savio Rodrigues correctly points out that “competing by ‘doing what Microsoft does, only cheaper’” is a losing proposition for open-source companies.

It is the image of a society in the midst of tectonic change. An older, stratified idea of the world was being torn up by political radicalism erupting out of the Revolution, and by a new social dynamism linked to the surging economy. Once-deferential artisans wanted to serve in public office themselves. Average Americans were less and less willing to passively follow the old elite, as they had for so long.

This digital upheaval is having a widespread impact beyond software. Record labels, newspapers, health care, and other industries are being overrun by digitization. At some point, we’ll get past this in-between phase and a new era of digital prosperity will ensue. As with Vanderbilt, however, we’ll need to be careful that our exuberance for income doesn’t get carried away into monopoly.

We’ve still got a tough slog ahead.

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It was a time when the world lunged forward, but with a foot constantly groping backward to the old-world establishment. We see this in open source as the industry strives toward service-based models but keeps a firm grip on old maintenance revenue models to help bridge the gap between the future and the past.

(Credit:
Amazon)

This scramble to get things ready often leaves companies not ready for the users they hope will flock to use their product. So, as a service to you, we’ve gone through and sorted out which of the products you can use right now. These are sites with open registration, and no special beta or invite requirements.

Also of interest, and something we didn’t do when comparing open and closed companies for last year’s shows, is the make-up of products that launched at the show. Were they for consumers or businesses?

How important is being open?

TechCrunch50, on the other hand, stayed around the same as the year before. Last year’s show had just 42 percent of the 52 launching companies open for public use, compared with this year’s 48 percent.

In the last three years, September has become a busy time for Web start-ups and other new companies looking to make their mark. Warring start-up conferences TechCrunch50 and DemoFall take place within mere days of one another, leaving a wake of more than 100 companies that are launched within just a week’s time, all vying for media and consumer attention.

We’ve also sorted out which ones are aimed at business users versus consumer use. All of this information can be found in a spreadsheet embedded at the end of this post. But before we get there, let’s take a look at the makeup of launches that were open versus closed:

• HealthyWage, a company that launched at TechCrunch50 will be opening up to beta users on Monday.
• Spawn Labs, the video game place-shifting service that demoed at TechCrunch50 will be available in November. We played with a demo unit at the show and everything worked great. The company is just working on production ramp-up to get it ready for the holiday season.
• Twirl TV, a DemoFall launch is currently open, but will close after the first 10,000 users sign-up. We marked it in this list as open, since we were able to register.
• Weels’ site said it would launch on Thursday, however it was having problems with Amazon’s EC2 service, and was expected to launch later in the evening.

Not surprisingly, TechCrunch50 had a better showing of consumer-oriented products and services. That’s to be expected though. The show is pitched at this audience and as a place for companies to pitch new software and services. Very little hardware is chosen to present–and what is has historically been for consumers. Demo on the other hand had more than a third of the companies aiming their products at businesses, or business users.

This year, there were slightly less products launching at Demo, although that’s not including the 14 “alpha pitch” companies, which are neither part of the main program, or by definition supposed to be live at the time of presenting. That said, there was a higher percentage of companies that were live and ready to go in the days following the show than the year prior, which came in at 75 percent compared with last year’s 67 percent.

Previously:

Post-launch frenzy: What can you actually use? (from 2008’s show)
TC50/Demo revisited: What’s alive, what’s dead? (seven months later)

Tech trade shows are never likely to have a 100 percent live at launch factor, nor should they. Many of the companies that made their debut at these shows are coming out of stealth mode and have worked very carefully to keep information about their service secret, both for a competitive advantage and to iron out last-minute kinks. Others have services that just plain aren’t ready for big audiences and need a small and eager test group to help see if their creation scales.

Worth noting is that there are a few sites that are on the verge of being open but that were not ready to go in time of this article going live:

Consumer vs. Business

Last year it was even worse, as both conferences happened at the exact same time.

Note: We considered sites that were listed as having “private” or “invite only” betas as closed. This is because there is no guarantee that you could get immediate access once you signed up to use them. For physical products, we counted whether or not you could purchase or download them. All data was gathered Thursday.

What’s often more impressive is how quickly some of these companies that aren’t live, go on to sort things out and open up. Although last year that wasn’t necessarily the case. Just seven months after the conferences many of the companies that were not yet live or open were still shut (including a few that shut themselves down). Will it be the same with this year’s crop? Check back here in six months.

(Credit: Robin Sloan)

Sloan’s goal is to raise $3,500 before November 1. Less than two days after launching his page on the site he already has more than $2,200 pledged from 73 supporters (including me). The money will be spent on printing. The more money that is contributed, the higher quality the publishing will be.

A few months ago someone sent me a link to a short story a friend of his had written and posted online. I made the mistake of glancing at it while at work and then got so absorbed I couldn’t stop reading until I was done. The story, Mr. Penumbra’s Twenty-Four-Hour Book Store was so interesting and well written, I just wanted more.

“More than the money it’s that early validation that’s so valuable,” he said. “For any creative project, not just writing, when you are embarking on it one of the fears is ‘does anybody other than me care about this?’”

Mozart may have had his patron Austrian prince, but he didn’t have Twitter followers or MP3s to share.

Sloan’s Kickstarter page provides an enticing teaser to his novella, with a written pitch and a slick video (no surprise given that his day job is as vice president of strategy at Current TV, the cable/satellite television network and Web site co-founded by Al Gore.)

The interactive and viral nature of the Web enables artists to reach out to the public in a way that no other medium does. It also means that artists formerly at the mercy of record labels and publishing houses can now turn fans into patrons instead.

A prime example of this is Musician Jill Sobule. She raised $75,000 last year to get an album recorded through her site Jill’s Next Record, offering compensation ranging from free admission to her shows for a $200 to a house concert for anyone who pays $5,000 and a chance to sing on the CD for $10,000.

Since he’s planning to write the book anyway, what do you get for your contribution besides a warm-and-fuzzy feeling? Three dollars gets a contributor a PDF copy of the book and the ability to follow along with behind-the-scenes updates. For $11, a physical copy of the book is thrown in. A signed copy comes with a $19 pledge, and for $29 you get your name listed in the acknowledgments. A $39 pledge brings four physical copies of the book.

The story centers on a digital and occult private investigator–a 21st century Sherlock Holmes. She’s a mix of Tilda Swinton and Carmen Sandiego and her Watson is an artificial intelligence-based daemon.

“This is cultivating your audience at every step of the creative process, which is wonderful,” Weinstein said.

“Corporate patronage, particularly because of the Internet and different social forces, has been thrown into disarray,” said Ted Weinstein, a literary agent in San Francisco.

“It’s a story set in a spooky, high-tech, mysterious San Francisco,” he said in a phone interview on Thursday.

“The idea is that people are casting a vote to say ‘I’m interested in this. I want to see you finish this story,’ but also ‘I’m reserving a copy of the book,’” he added.

The writer, Robin Sloan, is now working on a book and is appealing to passionate readers like me to help him get it published. He is seeking financial backers via a Web site called Kickstarter, which bills itself as a “funding platform for artists, designers, filmmakers, musicians, journalists, inventors, explorers.” (A similar site is called Fundable.)

Sloan is no stranger to self publishing. He edited a compilation of essays, New Liberal Arts, earlier this year and sells books on the Kindle. But he is more interested in using the Kickstarter site to cultivate and communicate with supporters than just get funding.

Robin Sloan gives a video pitch for his book project on Kickstarter.

Facebook Lite is here. Verdict: Better

Bing 2.0 could be around the corner

Today’s stories:

Video game industry takes another big hit

Globalfoundries, Chartered to merge

Motorola’s comeback attempt rests on software

Future AMD chip boasts ‘human eye’ reality

Fitness bot whips Japanese seniors into shape

According to some wayward tweets emanating from the Microsoft all-hands meeting Thursday, the new search engine, Bing, is about to get a makeover. It’s unclear when it will happen, but it appears it will include integration between Silverlight, maps, and images at the very least. Also looking for a fresh start is Motorola, which yesterday unveiled some new Android phones as well as a new philosophy for approaching the handset market. Plus, Facebook gets a new, more Twitter-like look, and much more.

Listen now:

Download today’s podcast

(Credit:
The Huffington Post)

Farmer describes himself as “a bit obsessed with data and using it to build better products and companies.”

On Farmer’s Twitter feed, Twitter.com/jessefarmer he describes himself as “Entrepreneur living in Palo Alto, Calif. I grew up in the Midwest and think everyone is awesome.”
Which will naturally be a relief to many.

On his Twitter feed, he declares that he has already talked with the Secret Service, who he endearingly abbreviates to “SS.” Farmer posted: “The conversation with the SS was fine. If the goal was to resolve the issue + inform the SS, the way it went down was suboptimal.”

Farmer’s own chat with the service he describes as lasting 15 minutes and being “friendly,” although he won’t comment on specifics.

He told me: “I went to school at the University of Chicago (SB Mathematics, ‘06), where he was my state senator. I volunteered for him in the primaries, worked with the California data team, and canvassed in N. Michigan during the general.”

Jesse Farmer, of Bumbalabs in Palo Alto, Calif., has given permission for Facebook to reveal that he was the developer, but, significantly, not the author behind the poll that nauseated many Monday.

In an e-mail to Technically Incorrect, Farmer says he first saw the offending and offensive poll Monday morning.

On his site 20bits.com, which I am fairly sure stands for one more than 19 bits, rather than two obituaries, Farmer seems a genial and sociable type, saying: “If you’re in the San Francisco Bay Area, drop me a line and let’s meet up!” He may be getting one or two requests.

Updated 2.37pm PST with comments from the developer

Farmer accuses Bababoosh of assuming he had “the worst motives.”

“I have a system in place to flag potentially offensive polls that I check once per day; I checked it Monday morning, saw the poll, and deleted it,” he said.

The first step in discerning the source of the “Should Obama be Killed?” Facebook poll has been taken.

The poll, which was removed by Facebook when it was brought to the site’s attention, offered those who wished to enjoy such an exercise four potential answers (see screen grab by The Huffington Post). More than 730 people participated before it was removed.

Which might make some wonder what other potentially risque polling might have slipped onto Facebook’s pristine pages.

He says that he knows the Facebook identity of the poll’s author and one presumes that this author might have received a social call from the Secret Service.

A reading of a rather fractious Twitter exchange with Bababoosh, an Oklahoma City programmer, suggests that Farmer was unhappy that a third party had informed the Secret Service rather than leaving him to do so.

Perhaps it might amuse some and appall others to discover that he is an Obama supporter.

This could be used to spy on people. For instance, an attacker could listen in on and record confidential conversations between an executive who is on a video conference call with another remote executive, according to Ostrom.

LAS VEGAS–Showing off technology that James Bond would love, two researchers at Defcon on Friday demonstrated tools that allow people to eavesdrop on video conference calls and intercept surveillance camera video.

Companies can use encryption on the network server to protect against these attacks, but encryption is not enabled by default, Ostrom said.

Attackers can replay video from the same stream or inject other video, like pornography, the researchers said.

Intercepting streaming video isn’t new, but UCSniff “makes it easier; it makes it plug and play,” Draper said.

“I want to ensure customers and clients that someone can’t steal movies off Flyxo,” En2Go’s system, he said.

Ostrom and Arjun Sambamoorthy, a research engineer at Viper Lab, also have developed another free tool called VideoJak that can be used to intercept video streams.

John Draper, aka “Capt. Crunch,” said he is interested in using the UCSniff tool to test the systems at start-up En2Go where he is chief technology officer. En2Go is signing up with companies to deliver high-definition media, including movies and corporate videos, to desktops.

“These assessment tools can show you the impact of the vulnerability to your network,” he said.

The free UCSniff tool, available in Linux and Windows versions, offers a slick graphical user interface for sniffing video, said Jason Ostrom, director of the Viper Lab at Sipera Systems. The tool basically tricks the voice-over-IP network carrying the video into sending the data packets to the attacker’s computer, he said.

An attacker needs to be in the same building as the victims to carry out the man-in-the-middle attacks over the network.

Thieves planning to steal from a museum, for example, could use the tool to change live surveillance video being watched by a museum security guard so that it replayed previous video of the art, giving thieves time to steal art without detection.

Download today’s podcast

Today’s stories:

NFL bans tweeting before, during, after games

iRobot gets single biggest order from Army

Sold! eBay jettisons Skype in $2 billion deal

Microsoft: Windows 7 can offer better battery life

Listen now:

Search: Google rules, Europeans do it more

Control4 to supply monitors in smart-grid project

Western Digital ships high-speed 2TB drive

In today’s podcast we talk about the sale of Skype, iRobot’s U.S. Army contract, and the NFL’s new rules that ban the use of Twitter, Facebook, and other social-networking tools before, during, and after games. We also get CNET senior editor Stephen Shankland in the studio to talk about
Windows 7 and its newly flaunted battery-conserving prowess. Is it worth the upgrade just for this feature? Listen to find out.