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The weepy countdown to Bill Gates’ last day on the job as a full-timer must be getting to Steve Ballmer. Always full of surprises, the big galoot is at it again.

Eric who?

(Credit:
Dan Farber/CNET News.com)

I mean, (Google has) a gestalt, but gestalt is gestalt. Let’s talk about the reality. The reality is one product makes 98 percent of all of their money, search. Oh, they have two products, AdWords and AdSense. They have two products, both search-based, that make all of their money, and it hasn’t changed a lot in five years. I’m not giving them a hard time, but we’ve got to learn–if you say, what have you learned, we try to learn from people’s successes, not from people’s gestalt. The gestalt is yet to be proven.

Yes, but as his erstwhile comrade in arms is wont to say, doesn’t that speak to the magic of software? Ballmer can try and call out Google for being a one-trick pony. Still that’s one heckuva pony. Truth be told, if Microsoft enjoyed that sort of technology prowess in search, I very much doubt Ballmer would have wasted four months wooing a unenthusiastic Jerry Yang.

I spoke with Elop a few weeks ago. As I reviewed my notes, his comments as a former outsider shed a different light on Ballmer’s ongoing eruptions of “Google-itis.”

In a revealing interview with The Financial Times, Ballmer distanced Microsoft from any criticism that it’s lost a step over the years. In fact, he added, why not point fingers at some other software behemoth? (Any guesses who that might be?)

But what’s with the nonstop trash talk from the CEO–especially in the countdown to Gates’ upcoming “Going Away Day?” He ought to watch his words. Over the next week, Ballmer is going to be all over the media, reaffirming that Microsoft is finished with its Yahoo crush and as relevant as ever. Inevitably, reporters will pop the “What about Google?” question. And the more Ballmer insists on convincing interlocutors about chinks in Google’s armor, the less people will believe him. In the same FT interview, for instance, Ballmer says the following:

Maybe so. I can’t predict whether Microsoft will ever be received warmly by Silicon Valley. There’s a long history and memories die hard. (Microsoft’s emissary to the Valley, Dan’l Lewin, keeps plugging away.) Meanwhile, the best way to put the relationship on a more solid footing is to continue to open up and prove Microsoft can build great technology, not just because management is “persistent.” (Note to the inner sanctum at Redmond: You can remain obsessed with Google. But try not to let on so much. It’s just bad form.)

“We’re trained in Silicon Valley to believe that Microsoft steals other peoples’ innovations,” says Microsoft’s Stephen Elop, who replaced the retiring Jeff Raikes as president of the company’s Business Division. “We just don’t give Microsoft credit. I don’t know whether that’s because of arrogance or hubris.”

Gestalt? If I didn’t know better, I’d be tempted to diagnose this as a severe case of Google envy (which may be the flip side of Microsoft’s ongoing search for respect as a technology innovator.)

“A lot probably has to do with the fact that Microsoft is in a different geography,” said Elop, who did prior stints at Juniper Networks, Adobe Systems, and Macromedia, where he held down senior posts. “We’ve had a generation of leaders who have had to compete head to head with Microsoft over the years. What’s happening now is that we’re moving on. We’ve got 2,500 people in the Valley. Maybe I’m surprised that opinion hasn’t evolved yet in the Valley, but it will. Too many things are going on.”

I haven’t seen speed out of Google really. I mean, come on. They have one product. It’s been the same for five years–and they have Gmail now, but they have one product that makes all their money, and it hasn’t changed in five years.

The Muxtape logo.

Soon, Ouelette said, Muxtape will return as “an extremely powerful platform with unheard-of simplicity for artists to thrive on the Internet.”

Ouelette, a former employee of InterActiveCorp’s Vimeo, created Muxtape this spring. Legal questions were instantly raised–though downloads were not permitted, Muxtape had not negotiated with record labels. A minor riff of scandal also came into view when gossip blog Valleywag deduced that Vimeo founder Jakob Lodwick, who had departed the company months ago, had funded Muxtape, creating a potential conflict of interest because Ouelette had quit his job at IAC to run the start-up.

Muxtape founder Justin Ouelette says the bureaucracy of the music industry was just too much for him to deal with. That’s why he took down the playlist creation Web site, which became a hipster craze earlier this year, after spreading largely via word of mouth. It’ll be relaunching soon, he says, but strictly as a service for independent bands to share their own music.

The idea of a cleaner, more unified site for bands is attractive; the idea of competing with News Corp., which just launched the MySpace Music service for its social site, is less so. It echoes of what happened with Napster founder Shawn Fanning when he tried to legitimize the service–it lost steam as a subscription music service and was finally sold to Best Buy earlier this month for $121 million.

“They had become too complex for a site founded on simplicity, too restrictive and hostile to continue to innovate the way I wanted to. They’d already taken so much attention away from development that I started to question my own motivations. I didn’t get into this to build a big company as fast as I could, no matter what the cost; I got into this to make something simple and beautiful for people who love music.”

Ouelette’s indie spirit is admirable, but the fate of his restructured venture doesn’t look good.

He spelled out his vision: “The new Muxtape will allow bands to upload their own music and offer an embeddable player that works anywhere on the web, in addition to the original Muxtape format. Bands will be able to assemble an attractive profile with simple modules that enable optional functionality such as a calendar, photos, comments, downloads and sales, or anything else they need.”

In August, the Recording Industry Association of America finally complained to Ouelette’s host, Amazon Web Services, and Muxtape was shut down. Frustrated with negotiations that were going to take months, he decided to give up.

(Credit:
Muxtape)

The Muxtape format has gained serious hipster cred from the site’s initial burst of popularity, but there’s a problem: bands already have MySpace profiles, as well as iLike concert listings, and they can upload their music to Imeem.

“I walked away from the licensing deals,” Ouelette wrote in a transparent, albeit navel-gazing letter on Muxtape’s home page. He’d hired a lawyer and tried negotiating, with varied reactions from the major labels.

The site was also allegedly burning through cash because of server demands, and it needed a revenue stream–but that would’ve put it on even shakier legal ground.

Businesses warming up to the iPhone

Obama to deliver weekly address via YouTube

Also in this podcast: Sun Microsystems announces it’s laying off up to 6,000 employees; Barack Obama says he’ll post his weekly public addresses to YouTube; eBay shuts down inauguration ticket scams; and Netflix’s CEO dreams of radical change in the realm of home TVs.

Listen now:

Encrypting hard drives on their way

Apple reporter Tom Krazit drops by the studio to talk about how Apple’s
iPhone, largely ignored by IT departments in its first generation, is now making its way into more and more companies’ tech arsenal.

Video game sales soar in October

eBay halts inauguration ticket sales

Download today’s podcast

Today’s stories:

Sun restructures, lays off up to 6,000

Sun chops heads: Can it get any respect?

Netflix: Wiimote, browser make for fab Web TV

Among other things, the state says online gambling drains the state of money by undermining horse racing, a key tourism industry for the state.

Groups like the Internet Commerce Association have voiced their concern over the state’s actions and are skeptical the seizure would stand up to legal scrutiny.

“It appears that there may be no statutory basis for this unprecedented action, that Kentucky may lack sufficient jurisdictional grounds and that it also may violate the Commerce Clause of the U.S. Constitution,” ICA President Jeremiah Johnston said in a statement.

“There’s a recognition among the industry that this is an action that has been occurring illegally,” Brislin said. “Registrars in the United States and foreign countries have been following the court order.”

Gaming industry and Internet commerce groups are balking at the state of Kentucky’s attempts to seize 141 Internet domain names for online gambling sites.

Lawyers will descend upon a Frankfort courtroom on Friday for the next phase of the Kentucky takeover, which began with a lawsuit from the state’s Justice and Public Safety Cabinet, seeking to force the gambling sites to block access to Kentucky users, or relinquish control of their domains. A district judge on September 18 ordered (PDF) the domain names be transferred to the state after Friday’s hearing. Representatives for the sites will have an opportunity at the hearing to object to the transfers.

However, Brislin said it is clear the state has jurisdiction to act because the sites it is attempting to take over agreed under the Internet Corporation for Assigned Names and Numbers to refrain from using their respective domain names for illegal purposes.

“The owners and operators of these illegal sites prey on Kentucky citizens, including our youth, and deprive the Commonwealth of millions of dollars in revenue,” Beshear said. “It’s an underworld wrought with scams and schemes.”

“Our laws are very specific about what constitutes illegal gaming, and anything that promotes or supports illegal gaming in Kentucky is illegal,” she said.

The state initiated the lawsuit in an effort to stop illegal online gaming. Kentucky is the first state to bring an action against Internet gambling operators resulting in the seizure of domain names, according to a press release from Kentucky Gov. Steve Beshear’s office.

The ICA, along with other groups like the Interactive Media Entertainment and Gaming Association, are actively opposed to the court order.

The list of sites affected includes AbsolutePoker.com, Bodoglife.com, and PokerStars.com. A large number of the sites have already been transferred to the state or are now locked from being transferred to anyone else, according to Jennifer Brislin, communications director for the Justice Cabinet. Some sites, such as GoldenCasino.com, have already notified users based in Kentucky they will no longer have access to the site.

Don’t get me wrong: I like free beer as much as any other self-respecting journalist. And there’s something amusing about throwing a party that’s explicitly, if stereotypically, designed to encourage geeky guys and fashionable women to hook up. But the geek/chic idea had its bumps–and grinds, as I discovered. While chatting with friends next to the stage, I was aggressively shoved out of the way by the insistent backside of a dancing attendee. From my vantage point I couldn’t tell if it was chic or geek, but either way sometimes the concept is better than the reality.

Surely the event’s many sponsors can’t be happy with the distraction. But it was disappointing that so few exhibitors had anything new to talk about that night. In fact, most of the sponsoring companies were familiar from such past events as Twiistup and Lunch 2.0. The key attention-grabbers seemed to be recently out-of-beta Engage, which helps you connect with potential dates within your existing social network, and last-minute-add ArtistForce, whose reps smartly hung a huge banner to help raise visibility in an otherwise tough corner spot.

The night club was filling up, free drinks were flowing, and Perry Farrell stood behind the DJ table. There was something distinctively bubbly at the TechCrunch/PopSugar “Geek Goes Chic” Meetup in Los Angeles last Thursday, and it wasn’t just the personalities of the PopSugar readers.

(Credit:
Michelle Thatcher/CNET Networks)

It might be a bubble if…Perry Farrell is your DJ.

Still, the impression of froth at the TechCruch/PopSugar meetup was only reinforced by the fact that the most-reported story from the party seemed to be the rumored ejection of representatives of both Mashable and tech-gossip blog Valleywag–complete with debate as to whether the incident was in fact staged to generate buzz. (”If a blogger gets thrown out of a party, but no one cares, does the Internet make a sound?” asks one commenter on the Los Angeles Times story.)

The party’s organizers are only the latest members of the Web scene to bring a little bubble love to Southern California. Social media blogs Mashable and Bub.blicio.us have both hosted LA events in the last month. The move makes sense: Aside from being at the center of the entertainment industry, Los Angeles is one of the fastest growing regions for venture capital [PDF link], and late last year the Los Angeles Times
reported that the region had bypassed New England to rank second in the U.S. for tech investment. Plus, the tech community here has been gaining steady momentum since 2006; Tuesday marks the second anniversary of the LA Geek Dinner gatherings.

We spend a few minutes debating the impact of Carl Icahn joining the Yahoo board and what it means for Jerry Yang’s future. Larry thinks that Yang bought himself more time to turn things around. If so, he will need to speed up delivery on the Yahoo Open Strategy and build a social layer into Yahoo’s collection of services.

On this week’s EIC Squared podcast, ZDNet Editor in Chief Larry Dignan and I discuss the news of the week. It was a big week for Microsoft, with several announcements and teases from its meeting in Seattle with financial analysts. Steve Ballmer is still bullish on the online space, but not on Yahoo. We also talk about Kevin Johnson’s departure from Microsoft. (See coverage on the Microsoft financial analyst meeting from Ina Fried and Mary Jo Foley.)

Finally, we discuss the impact of Facebook Connect, which will let users access and feed their Facebook profiles and friends on any Web site. It’s Facebook’s way of extending its platform to embrace other services and get more data and pages flowing through its social portal.

Update: Many users are reporting that the straight HTML version of Gmail is still working (some say it does not). Likewise, access via IMAP is still functioning for some users.

Update, 3:40 P.M. Pacific Time: Gmail is recovering, according to Google and reports from users. The Gmail Help Discussion saw this post added at 3:30 P.M.: “Engineers have pinpointed the issue causing the 502 errors and it looks as if users should start to regain normal functioning of their account. Thanks for being patient while we worked to sort out this problem.”

Google’s e-mail service Gmail is offline for many users right now. Those wondering if they are alone in experiencing the outage can find comfort on Twitter, which is up and sizzling with Gmail down alerts. To track the spread of the outage (and to find out when it is corrected), take a look Twitter Search, which is posting dozens of items a second about the outage.

Users already logged into Gmail when the outage started may be able to read messages in their in-box, although sending messages generates an error.

Not what you expect from Google.

Update, 5:30 P.M.: According to a Google spokesperson, “The issue was caused by a temporary outage in the contacts system used by Gmail which prevented Gmail from loading properly.”

Some Webware readers are reporting that Gmail’s business e-mail service is also down.

Update, 9:40 P.M.: Google is sorry.

More updates: Google’s blogs are strangely silent on the topic, but the Gmail Help Discussion in Google Groups has the official updates about the outage. Also, some users are reporting that Gmail is working for them again.

The first official notice of the outage was at 2:31 P.M.

The new new battle uniforms would provide protection against nuclear, biological, and chemical attacks, and would feature automatic temperature control. A new protective vest is also planned. In addition to keeping the lead out, the helmet will be prewired for minicam video transmission, GPS navigation, and assorted networking gear, the official said.

The Agency for Defense Development will begin the two-phase development on a new combat uniform beginning next year, according to The Korea Times.

Things may be getting a little more stylish up on the DMZ (the Korean Demilitarized Zone) when Republic of Korea troops don their new high-tech battle uniforms. Accessories could include bulletproof helmets and a new assault rifle.

(Credit:
ADD)

The rifle has already been tested and could come online sooner than the rest of the outfit. The double-barreled K-11 assault rifle lets the shooter fire either NATO 5.56- or 20-millimeter grenades, all off the same trigger. Day and night aiming is accomplished with a thermal target seeker and laser that calculates distance automatically–a true point-and-shoot.

“The agency has completed studies on the concept of the future combatant uniform and equipment,’” an unnamed official told the newspaper. “From next year, we plan to begin developing related technology and equipment after getting approval from the Defense Acquisition Program Administration.”