Microsoft's new look

• The Good: Easier and faster to install, with greater flexibility; a vastly improved user interface; a built-in desktop search, calendar and sidebar; greatly improved security


• The Bad: The price — hey, it's supposed to be just an operating system after all; it's a memory hog; Vista Home basic will disappoint anyone looking for an improvement over XP; it could require hardware upgrades


• The Verdict: a handsome, stable operating system that makes you realize XP's interface was getting sadly tired

Microsoft's 2Q profit falls 28%

Microsoft Corp. said Thursday its fiscal second-quarter profit fell 28 per cent, as delays from the launch of its new version of Windows cut into holiday-quarter revenue.

For the three months ended Dec. 31, earnings fell to $2.63 billion, or 26 cents per share, from $3.65 billion, or 34 cents per share during the same period last year.

Analysts polled by Thomson Financial expected the Redmond, Wash.-based software maker to post a profit of 23 cents per share.

Revenue rose to $12.54 billion from $11.84 billion in the year-ago quarter. Results were higher than Wall Street's average forecast for $12.08 billion in sales.

Space, the final frontier

National Post

It now appears evident -- judging from the frantic activity of diplomats -- that rumors of a major event in Earth's orbit earlier this week were true. China, it seems, has become the first country to destroy a satellite using a ground-launched vehicle.

According to a forthcoming report in Aviation Week and Space Technology, an obsolete Chinese weather satellite began to display signs of "orbital distress" on Jan. 12. The satellite soon metamorphosed on radar screens into a scattered cloud of tiny objects; it had apparently been smashed to bits by a "hit-to-kill" missile launched from within Szechuan province. Although Russian authorities remain publicly skeptical at press time, the other major powers seem prepared to accept that China has taken a step toward the militarization of space. An arms race on the final frontier is bound to follow unless the United States hangs its head and shuffles to the negotiating table to talk over the space treaty that the Russians and Chinese have long desired.

Despite appearances, China's seeing eye fastball should not be reflexively chalked up as a failure for U.S. intelligence. Av Week suggests that U.S. military planners foresaw something like the Chinese test last year, when they produced the first revision of overall U.S. space policy in nearly a decade. A 2003 Pentagon report specifically warned that "Beijing may have acquired high energy laser equipment that could be used in the development of ground based anti-satellite (ASAT) weapons."

On the other hand, Washington arguably conceded some moral high ground in the language of its 2006 policy revision when it declared that "Freedom of action in space is as important to the United States as air power and sea power." China can now expound the same policy in mirror image, when and if it chooses to admit to its act of satellite euthanasia. (A Friday afternoon New York Times Web headline summed up China's cryptic statements on the event: "Nothing to worry about, if we did it.")

The American diplomatic position is also somewhat compromised by the fact that the U.S. is the only other country to have used satellite-killing technology based within Earth's atmosphere: In a September, 1985 trial of a program that was later scrapped, an F- 15A fighter plane launched a multistage rocket that, in turn, fired a homing projectile into the bowels of an old communications satellite at 24,000 km/hr. (The Soviets are also said to have made successful anti-satellite tests, but their program used other satellites as a platform.)

Whatever the military and geopolitical ramifications of such a test, we now live in a globalized world whose information networks are highly dependant on satellite communications. China cannot deny its obligations to countries that are engaged in the purely peaceful exploitation of space, to the private companies that have an installed industrial base there, and to humankind in general, which benefits from space borne technologies such as global positioning. Even if the militarization of space is inevitable or desirable, safe commercial exploitation of the orbital environment remains a higher priority. The satellite destroyed in the Chinese test weighed over four-fifths of a ton, mass that is now whirling around in the orbital shell. The U.S. Air Force is tracking dozens of bits of debris and theoretical models predict that an ASAT kill would produce tens of thousands of fragments. If China wanted to show it can be just as irresponsible as any other superpower, it can be congratulated on success.

If genuine, this test will force U.S. planners to revisit estimates of overall Chinese technical sophistication. (In particular, it will affect U.S. operational planning against an invasion of Taiwan.) The implications for future military budgets are sobering, doubly so in light of recent indications that U.S. spy satellites are more vulnerable to being blinded by surface-based lasers than previously thought. Hardly any more is known publicly about secret U.S. capabilities in satellite warfare than about those of China. But the U.S. can take little comfort in being ahead in space-war prowess. As in Iraq, it faces another variant on "asymmetrical warfare": Right now the Chinese just don't have as much up there to lose as do America and the rest of the free world.

Time cover story

Apple reports record 1Q profit

SAN JOSE, Calif. - Apple Inc. on Wednesday posted a record profit in its fiscal first quarter, beating Wall Street estimates as earnings rose 78 percent amid strong holiday sales of its iPod music players and Macintosh computers.

During the final three months of 2006, the Cupertino-based company Apple said it earned $1 billion, or $1.14 per share, compared to $565 million, or 65 cents a share, in the year-ago period.

Analysts, on average, were expecting earnings of 78 cents per share on sales of $6.42 billion, according to a Thomson Financial survey. Shares of Apple lost $2.15 to close at $94.95 on the Nasdaq Stock Market as technology stocks in general tumbled. In extended trading following its report, Apple shares climbed 1.7 percent to $96.61.

Schwarzenegger backs 2007 deadline for U.S. in Iraq

Reuters - California Gov. Arnold Schwarzenegger, a Republican, suggested on Wednesday that the United States should withdraw its military forces from Iraq by the end of this year.

Ottawa aims to rebuild frayed ties with China

GEOFFREY YORK AND STEVEN CHASE, The Globe and Mail

BEIJING, OTTAWA -- After nearly a year of friction and neglect in Canada-China relations, the Harper government is launching a big push to rebuild ties with Beijing, including plans to target China as one of 10 markets that will be the focus of Canada's trade efforts.

It's an apparent sharp reversal from just two months ago when Prime Minister Stephen Harper traded barbs with the Chinese and vowed never to sacrifice human-rights concerns on the altar of the "almighty dollar" -- even if it cost business.

This week, a new tone was evident, with International Trade Minister David Emerson and Finance Minister Jim Flaherty making high-profile visits to China to try to restore good relations.

"I would characterize it as re-energizing a relationship that has been very deep and very strong for a long time," Mr. Emerson said yesterday at a news conference in Beijing.

Business groups, which were concerned the diplomatic tiff was hurting trade, applauded the renewed emphasis on commercial relations with China. But they noted that the visit by the two ministers was a far cry from the so-called Team Canada trips that Liberal prime ministers used to lead.

Private-sector players say they believe the Prime Minister's Office is pursuing what it has called a "two-track approach to China," in which Mr. Harper reserves the right to criticize Beijing's human-rights record while leaving his economic ministers to keep trade and business relations humming.

"Prime Minister Harper is not going to stump for Canadian companies the way prime minister Chrétien did," one senior Toronto business official said. "He is not the Team Canada cheerleader-in-chief . . . but believes that's the purview of the minister of trade."

In a speech last night, Mr. Emerson said the Tories are developing a "China strategy" that will be financed with new money in the forthcoming federal budget, along with additional money from reallocations within the Trade Department.

China will be one of about 10 "strategic markets" that will become the focus of Ottawa's trade efforts, based on an internal government study of the countries with the best prospects for trade with Canada, Mr. Emerson said.

He did not identify all 10 countries, but said they would include China, India, Brazil, Vietnam and perhaps other Southeast Asian countries. "China is way up on that list," he said.

The Tories are under pressure from the business community to improve Canada-China relations, which fell into disarray last year. Mr. Harper snubbed the government by declining an invitation to visit Beijing and refusing to send any cabinet ministers to China until late in the year. He also criticized China's human-rights record, provoking a frosty response. Canadian business leaders were increasingly worried that tensions would damage prospects in China, as were some government departments, officials said.

Mr. Emerson acknowledged that Canada has suffered "a little period of remission" in its relationship with Beijing, but said this setback could lead to a "more strategic, more aggressive, more constructive engagement" that could strengthen relations in the long term.

He maintained that his government can improve economic relations with China while retaining the right to criticize its human-rights record.

"As Canadians, we do carry our values and perspectives beyond Canada to the rest of the world," he said. "We talk candidly about democratic governance, about the importance of the rule of law. . . . Open discussion and engagement in these broader issues should not conflict with commercial interests."

But China watchers warn that Ottawa cannot continue to publicly hector Beijing on human rights and assume that trade won't be affected.

Wenran Jiang, director of the University of Alberta's China Institute, said the notion that two nations can have "cold" political relations but "hot" economic relations will not fly in Beijing.

"That is not going to work with Canada and China," he said. "We have cold politics and lukewarm economics." He said the Chinese can take criticism but not "grandstanding statements" such as the ones Mr. Harper made last year.

In an interview, Mr. Emerson acknowledged that the new trade strategy has some similarities to the previous Liberal government's policy of expanding the number of trade offices in China. The Liberals announced in 2005 that a network of trade offices would be created in 25 Chinese cities, but the plan was scuttled after the Liberals lost the federal election last year.

In his speech, Mr. Emerson said Canada is losing ground to its rivals in the Chinese market. Canadian exports to China grew only 2.3 per cent in 2005, while the United States recorded a 9.14-per-cent increase and Australia reaped a 40-per-cent jump. "For Canada, I suspect 2006 was even worse," he said.

Business leaders said the government's new push is long overdue. "We just don't have the troops on the ground that we need," said Nancy Hughes Anthony, president of the Canadian Chamber of Commerce, who is traveling in China this week.

But the visit to Beijing by the two cabinet ministers is not enough to resolve the tensions in the relationship, she said. "There should be concrete plans for visits by the Prime Minister and the Foreign Minister. So far, they've been missing in action."

Howard Balloch, a former Canadian ambassador to China who is now the head of a consulting firm in Beijing, applauded the visit by Mr. Emerson and Mr. Flaherty. "I'm sure they feel it's time to get back on track," he said.

Canadian entrepreneurs too confident

Canadians suffer from an overconfidence in their entrepreneurial skills that leads to a high failure rate in their business ventures, a new international study suggests.

A team of economists from Germany, the Netherlands and the United States has discovered that among aspiring and established entrepreneurs in 18 countries, Canadians are among the most confident they have the necessary skills to start a business. Canadians who take the plunge also have one of the lowest average chances of staying in business.

Using data collected from the Global Entrepreneurial Monitor research program, an annual assessment of the national level of entrepreneurial activity around the world, the economists created a random sample of the population in each country and identified people in each sample who either owned or managed a business or were in the process of starting one.

Overall, they found confidence in one's own entrepreneurial skills is a major driver in the decision to start a business. New entrepreneurs starting companies are the most confident, even though their abilities are untested in the market.

The study also found that countries exhibiting a high rate of entrepreneurial confidence exhibit significantly higher startup activity but lower average chances that a business will survive for more than 42 months.

Only people in New Zealand, Hungary, Argentina and the United States are more confident than their counterparts in Canada, where 50% believe they have the necessary skills to start a business.

This contrasts sharply with Japan, where only 11% do, and Sweden, where 24% have such confidence.

But in Canada, the ratio of established to nascent entrepreneurs is 0.5, the second-lowest ratio in the sample. This means that for every established or successful entrepreneur, there are two aspiring entrepreneurs trying to start a business.

In countries with lower levels of confidence, such as Japan or Sweden, there are many more established entrepreneurs relative to nascent entrepreneurs (2.3 and 1.7 respectively), which translates into higher average survival chances of those few individuals who actually start a business in these countries.

Rocket slams into U.S. Embassy in Athens

MSNBC News Services - ATHENS, Greece - The U.S. Embassy in Athens came under fire early Friday from a rocket that exploded inside the modern glass-front building but caused no casualties in an attack police suspect was the work of Greek leftists.

Narrowly missing the embassy emblem, the anti-tank shell pierced the building near the front entrance shortly before 6 a.m., damaging a bathroom on the third floor, which houses the ambassador’s office, and shattering windows in nearby buildings.

“We’re treating it as a very serious attack,” U.S. Ambassador Charles Ries said.

Greece’s Public Order Minister said police were examining the authenticity of anonymous phone calls to a private security company claiming responsibility on behalf of Revolutionary Struggle, a militant left-wing group.

“It is very likely that this is the work of a domestic group,” Minister Vyron Polydoras said. “We believe this effort to revive terrorism is deplorable and will not succeed.”

Revolutionary Struggle claimed responsibility for a May 2006 bomb attack on Culture Minister Giorgos Voulgarakis, in which nobody was hurt.

Admitting strategy error, Bush adds Iraq troops

NBC News and news services - Defying public opinion polls and newly empowered Democratic lawmakers, President Bush told Americans Wednesday that he is dispatching 21,500 additional U.S. troops to Iraq. And in a rare admission, he said he made a mistake by not deploying more forces sooner.

“The situation in Iraq is unacceptable to the American people, and it is unacceptable to me,” Bush said in a televised address from the White House. “Where mistakes have been made, the responsibility rests with me.”

With American patience running thin over his handling of the war, Bush said he would put greater pressure on Iraqis to restore order in Baghdad and used blunt language to warn Iraqi Prime Minister Nouri al-Maliki that “America’s commitment is not open-ended.”

“If the Iraqi government does not follow through on its promises, it will lose the support of the American people, and it will lose the support of the Iraqi people,” Bush said.

Bush said his new strategy, in which Iraqis will try to take responsibility for security in all 18 provinces by November rather than just three now, “will not yield an immediate end to suicide bombings” and other violence.

But he said the increased military presence would help break the cycle of violence gripping Iraq and “hasten the day our troops begin coming home.”

Bush said that 17,500 troops would go to Baghdad and 4,000 to the volatile Anbar province, Senior administration officials said before the president spoke that the first wave of troops is expected to arrive in five days, with others joining about 130,000 U.S. troops already in Iraq in the coming weeks.

Bush’s decision will push the American presence in Iraq toward its highest level and puts him on a collision course with the new Democratic Congress.

House votes to increase minimum wage

Democrats push through increase in hourly pay from $5.15 to $7.25.

The Democratic-controlled House voted Wednesday to increase the federal minimum wage to $7.25 an hour, bringing America's lowest-paid workers a crucial step closer to their first raise in a decade.

The vote was 315-116, with more than 80 Republicans joining Democrats to pass it.

Ski town sinking in warm weather

Without snow to groom, chairlifts to load and hotel guests to manage, hundreds of seasonal employees in the resort town of Collingwood have been laid off. All eight area ski resorts have closed - one had yet to open - until the cold arrives.

If it arrives.

Bush puts final touches on new Iraq policy

The Washington Post - President Bush is putting the final touches on his new Iraq policy amid growing skepticism inside and outside the administration that the emerging package of extra troops, economic assistance and political benchmarks for the Baghdad government will make any more than a marginal difference in stabilizing the country.

Washington's debate over Iraq will intensify this week as Bush lays out his plans, probably on Wednesday or Thursday, and Secretary of State Condoleezza Rice and other administration officials face tough questions from Democrats in congressional hearings.

Although officials said the president has yet to settle on an exact figure of new troops, senior military leaders and commanders are deeply worried that a "surge" of as many as five brigades, or 20,000 troops, in Iraq and Kuwait would tax U.S. ground forces already stretched to the breaking point -- and may still prove inadequate to quell sectarian violence and the Sunni insurgency. Some senior U.S. officials think it could even backfire.

"There is a lot of concern that this won't work," said one military official not authorized to speak publicly about the debate at the Pentagon.

Meanwhile, the political and economic ideas under consideration all appear to be variations on initiatives that U.S. and Iraqi authorities have proved unable to implement successfully since the 2003 invasion or have tried and found wanting, according to former U.S. officials and experts on reconstructing war-torn countries.

Many officials at the State and Defense departments also doubt that the government of Prime Minister Nouri al-Maliki is capable of making the necessary reforms, given its track record of promising but not delivering since taking power in May and despite Maliki's assurances in a speech yesterday that he would hold Iraqis accountable for implementing a new Baghdad security plan.

Possible Israel nuclear attack on Iran

U.K. newspaper reports Israel intends to strike up to three targets in Iran

London, Associated Press - A British newspaper reported Sunday that Israel has drafted plans to strike as many as three targets in Iran with low-yield nuclear weapons, aiming to halt Tehran’s uranium enrichment program. The Israeli Foreign Ministry denied the report.

Citing multiple unidentified Israeli military sources, The Sunday Times said the proposals involved using so-called “bunker-buster” nuclear weapons to attack nuclear facilities at three sites south of the Iranian capital.

Israeli Prime Minister Ehud Olmert’s office said it would not respond to the claim. “We don’t respond to publications in the Sunday Times,” said Miri Eisin, Olmert’s spokeswoman.

Israeli Minister of Strategic Threats Avigdor Lieberman also declined to comment on the report.

Foreign Ministry spokesman Mark Regev denied the report and said that “the focus of the Israeli activity today is to give full support to diplomatic actions” and the implementation of a U.N. Security Council resolution imposing sanctions on Iran for refusing to halt enrichment.

The United States and its allies accuse Tehran of secretly trying to produce atomic weapons, but Iran claims its nuclear program is solely for peaceful purposes, including generating electricity.

Iranian President Mahmoud Ahmadinejad has condemned as invalid and illegal the U.N. resolution.

Tibet & China linked with luxury train

A five-star tourist train is to be launched on the railway line linking Tibet and China. The luxury train will carry passengers in hotel-style comfort along the world's highest railway line, which links China's northwest province of Qinghai to the Tibetan capital, Lhasa. Since opening six months ago, five regular three-class trains - specially designed to withstand the altitude - have ferried passengers through the inhospitable terrain.

The railway line opened on July 1, 2006. Vast swaths of it are built directly into the permafrost of the Tibetan plateau, and it soars to 5072 metres at its highest point, the Tanggula Mountain Pass.

For most of us, it's been a good year

Shannon Proudfoot, CanWest News Service

Most Canadians feel 2006 was a good year and are looking ahead optimistically to 2007, a new poll shows.

The Ipsos Reid survey, conducted for CanWest News Service and Global National, shows 76% of Canadians think 2006 was a "good year overall" in comparison to years past, with 18% calling it a "very good year."

One in five (21%) felt this was a "bad year overall," with 6% giving it the thumbs-down as a "very bad year."

"It's had its flaws, it's had its difficulties, but overall, families are happy and optimistic, citizens are happy and optimistic," says John Wright, senior vice-president of Ipsos Reid public affairs. "It's been a good year."

The poll was conducted by telephone from a sample of 1,000 adult Canadians between Dec. 12 and 14, and is considered accurate within 3.1 percentage points, 19 times out of 20.

Looking ahead, most Canadians are feeling hopeful, with 88% predicting 2007 will be a good year for them, and for their families.

Most (78%) are confident 2007 will bring glad tidings for Canada, but the widespread optimism comes to a halt when they look beyond Canadian borders: 46% of those surveyed are pessimistic about the coming year for the world in general, while 49% are hopeful it will bring good news.

"There is a big world out there that is fit on the small screen every day, and it is troubling," Mr. Wright says.

Terrorism is "the great destabilizer," and 24-hour news reports bring that reality into people's homes more than ever before, he says, which might account for some of the concern about the world in 2007. But people are ultimately more influenced by the issues that hit closest to home, he adds, so with robust economic and employment figures, and another federal election the most serious instability on the Canadian horizon, life looks pretty rosy in the new year.

Albertans and Atlantic Canadians were among the happiest, with 87% and 83% of them, respectively, describing 2006 as a good year.

Quebecers were least enthusiastic, with 28% of them describing the year as a bad one, followed by British Columbians at 22%.

The ongoing oil windfall in Alberta, Quebec's frustrations with the federal government and the mission in Afghanistan, and B.C.'s recent storms may help explain some of those sentiments, Mr. Wright says.