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Microsoft’s profits in the three months to the end of March dropped slightly but the results still beat analysts’ expectations after a surprise rise in sales of its Windows operating system.The world’s largest software firm made a net profit of £3.2 billion ($5.11 billion), compared with £3.3 billion a year earlier.

Sales rose by 6% to £10.875 billion.

Windows sales rose 4% against forecasts of a 4% decline, though sales at its entertainment division, which includes the Xbox console, fell 16%.

Its business division saw revenues increase 9% “reflecting the continued strength of Office 2010″, the company said.

Microsoft shares rose 3% in after-hours trading in New York.

The company also noted that the results for the same quarter a year ago had been boosted by a £288 million tax benefit.

Windows is facing competition from the growth of tablet computers such as Apple’s iPad and mobile devices using Google’s Android system.

However, Microsoft is hitting back with the release of Windows 8, an operating system for PCs and mobile devices.

Earlier this week Microsoft said this next operating system would come in three different types.

For those with Intel-compatible machines, the OS will be available in two versions – Windows 8 and Windows 8 Pro.

And for those with devices, largely tablets, powered by ARM-designed chips, there will be a Windows RT version.

Microsoft’s profits in the three months to the end of December fell as lower computer sales hit its core Windows business.The world’s largest software firm made a net profit of £4.27 billion ($6.624 billion), against £4.42 billion for its second quarter last year.

Revenues rose 5% to £13.47 billion, slightly down on some analysts’ expectations.

Revenue at the Windows operating system division fell, but rose at its server, Xbox 360 and online services arms.

Wall Street welcomed the figures, with Microsoft’s shares rising 2.1% in after-hours trading.

Tighter cost control and a continuing reduction of losses at the Bing search engine helped boost the figures.

Analysts were expecting a fall in business at the Windows division due to slower sales of PCs.

The computer industry is facing a worldwide shortage of hard disk drives due to flood devastation in Thailand whit hit the global supply chain of suppliers in November.

But Windows is also facing competition from the growth of tablet computers such as Apple’s iPad and mobile devices using Google’s Android system.

However, Microsoft is hitting back with the release of Windows 8, an operating system for PCs and mobile devices.

Microsoft chief executive Steve Ballmer said in a statement: “We delivered solid financial results, even as we prepare for a launch year that will accelerate many of our key products and services.”

During the quarter the Windows and Windows Live division posted revenue of £3.05 billion, a 6% fall on the previous year.

The Entertainment & Devices division saw the sharpest revenue rise, up 15% to £2.78 billion.

Google was the most visited website with US users in 2011 but Facebook was not far behind according to market researchers.Nielsen suggests more than 153 million visitors clicked onto Google branded pages each month, as Facebook attracted close to 138 million visitors.

Yahoo came third with about 130 million visitors each month.

But analysts warned Yahoo’s tally might be at risk if young people continued to turn away from web-based email.

The study is based on data collected between January and October and included visits from home and work computers. It involved a sample from a global panel of 200,000 people.

Website                                  Unique visitors per month
1. Google                                        153,441,000
2. Facebook                                     137,644,000
3. Yahoo                                         130,121,000
4. MSN/WindowsLive/Bing                 115,890,000
5. YouTube                                     106,692,000
6. Microsoft                                      83,691,000
7. AOL Media Network                        74,633,000
8. Wikipedia                                      62,097,000
9. Apple                                           61,608,000
10. Ask Search Network                     60,552,000

Source: Nielsen

Although Google trumped Facebook as the most popular web brand, the search giant’s Google+ network came far behind Mark Zuckerberg’s site in Nielsen’s ranking of the most popular social networks and blogs.

Google+ came eighth in the list with 8.02m unique monthly visitors.

That also put it behind Google’s weblog publishing tool Blogger, as well as Twitter, Wordspace, Myspace, Linkedin and Tumblr.

Google’s YouTube was identified as the most popular destination for online videos, attracting more than three times the number of monthly visitors as the music video service Vevo.

While Yahoo maintained its position as one of the top three web brands, an earlier study cast doubt over its ability to retain the position over coming years as it’s email system faces a declining market share.

Google’s Chrome has overtaken Mozilla’s Firefox as the world’s number two browser behind Microsoft’s Internet Explorer last month, according StatCounter. The findings quote Chrome’s worldwide market share at 25.69% and Firefox’s at 25.23%. Internet Explorer, according to the same findings, dominates worldwide market share at 40.63%.

In the U.S., meanwhile, Chrome is still number three with 17.3%, a 6.41% jump compared to last November. Internet Explorer held the top spot with 50.66% and grew by 0.42%. Firefox was second with 20.09%.

Internet Explorer’s commanding lead has been challenged by the browser’s near absence from smartphones and tablets.

Last month, another researcher, Netmarketshare, reported that Internet Explorer’s share dipped below 50% for the first time.

Safari, Apple’s default browser on the iPhone and the iPad, claimed 62.17% of mobile traffic. Internet Explorer, meanwhile, had 52.63% of desktop traffic, according to the researcher.

Chrome may be coming to Google’s mobile Android platform soon, according to reports. The 3-year-old browser’s growth, which benefits from being promoted on Google.com, hit 200 million users in October.

Chrome also became the most popular browser for accessing Mashable in August.

Xbox Live users are being urged to check their accounts after some were scammed by fake emails.The phishing attack sent users to a fake site where they were asked to input personal details like addresses, emails and credit card details.

Microsoft is investigating and says a small percentage of users are affected.

“We take the security of the Xbox Live service seriously and work to improve it against evolving threats,” a Microsoft spokesman said.

“Very occasionally, though, we are contacted by members regarding alleged unauthorized access to their accounts by outside individuals.”

The spokesman continued: “We can confirm that only a small percentage of Xbox Live customers have been affected here in the UK. We highly recommend all Xbox Live users follow our account security guidance in order to protect their account details.”

“We work closely with impacted members directly to resolve any unauthorized changes to their accounts and, as always, highly recommend all Xbox Live users follow our account security guidance in order to protect their account details.”

Microsoft confirmed there had been no breach in the security of Xbox Live itself.

The company says there is advice on its website about staying safe online but advises that people should never give out passwords or email addresses.

It says users should never type personal information into websites unless they are sure that they are genuine.

Visits to video sharing websites by UK users have gone up by more than a third in the last year.The biggest driver of traffic to those sites is music videos (33%), followed by TV shows (17%), film (11%), gaming (10%) and news (9%).

The figures, from internet research company Experian Hitwise, show YouTube accounts for nearly 70% of all video website hits.

It’s now the third most popular site in the UK after Google and Facebook.

Lady Gaga was the most in demand for artist within music searches.

The research was gathered between September 2010 and September 2011.

During that time 240 million hours every month were spent by British internet users watching videos online.

UK’s top 10 websites:

Google UK
Facebook
YouTube
eBay UK
Windows Live Mail
MSN UK
Google.com
BBC News
BBC Homepage
Yahoo! UK & Ireland

Research by Experian Hitwise

Illustrating its dominance in this area, Google owned YouTube, clocked up 184 million of those hours.

That number is still dwarfed by the amount of time spent on social networking sites though.

The same research shows 800 million hours were spent each month on sites like Facebook and Twitter by the UK’s internet users.

Despite YouTube’s dominance of video sharing websites there was also strong growth for other ones too.

BBC iPlayer, the second most popular video site, experienced a 22% rise in traffic last year.

That means the number of visits to the site has doubled in the last three years.

Microsoft has finalised the £5.3 billion acquisition of VoIP service Skype.The deal had to pass regulatory approval in several markets, with Europe being the biggest hurdle for Microsoft. The EU Commission has previously fined Microsoft for it’s antitrust behavior.

Under the terms of the agreement, Skype will become a new business division within Microsoft, and Skype CEO Tony Bates will assume the title of president of that division.

Skype was founded in 2003 by Niklas Zennström and Janus Friis.

It was bought by eBay in 2005, but eBay couldn’t find a way to integrate it into its business and subsequently sold it to an investment group led by Silver Lake in 2009.

The deal with Microsoft is a very profitable exit for that group of investors, which includes Index Ventures, Andreessen Horowitz and the Canada Pension Plan (CPP) Investment Board- as they paid £1.71 billion for Skype.

As for the future of Skype and the challenges Microsoft faces, the first and foremost will be the fact that Skype is not yet profitable. However, Skype’s huge user base (more than 663 million users, 170 million of which use the service monthly) and constant growth make it an appealing purchase for a company that knows what to do with it.

“Together, we will be able to accelerate Skype’s goal to reach 1 billion users daily,” said Bates in a statement.

You can watch the video at:

Users of the Internet Explorer web browser tend to have lower than average IQ-  according to a survey of online habits.A psychometric consulting firm called AptiQuant gave free online IQ tests to 100,000 people, and then plotted the scores against the browser on which the tests were taken.

It found that Internet Explorer users scored lower than average IQ, while Chrome, Firefox and Safari users were very slightly above average.

Camino, Opera and Internet Explorer with Chrome Frame were scored “exceptionally” high.

“The study showed a substantial relationship between an individual’s cognitive ability and their choice of web browser,” AptiQuant concluded.

“From the test results, it is a clear indication that individuals on the lower side of the IQ scale tend to resist a change/upgrade of their browsers.”

Some people have suggested that there may be other factors at work.

Since IE is the default browser for Windows PC users, anyone who doesn’t know how to download and install a new browser will be stuck with it – “which drags down the average”.

And users of other browsers “include a disproportionate number of computer geeks”, which might bring their average up.

Or, they admit, it might be that “IE users really are kind of dumb.”

Within the group of IE users, version 6 users score lowest, while users of version 8 do rather better.

The overall chart shows that Firefox has the smallest percentage of low-IQ users, and the largest of average or high-IQ users. A similar study five years ago found that users had broadly similar IQs.

But if you ever want to argue that Internet Explorer 6 users are too stupid to upgrade, at least now you’ve got some empirical evidence.

US technology company Microsoft has announced that it’s annual revenues hit a record of £43.4 billion.
Sales of the company’s Xbox 360 videogame console and its Office software helped fuel the growth.

Net income at the world’s biggest software maker jumped 23% to 23.15bn for the year.

The figures, which beat forecasts, showed final quarter revenues reached a record high of £10.85 billion, leading to profits of £3.73 billion,  boosted chiefly by sales of Office, Xbox and server software behind Microsoft’s push into cloud computing.

Microsoft’s business division, which sells the Office suite of programs, including Outlook, SharePoint and Excel, was the company’s biggest seller in the quarter, increasing sales by 7% to £3.65 billion.

The company’s online services unit, which runs the Bing search engine and MSN internet portal, increased sales by 16.5% to £ 413 milion, but saw losses increase to £455 million as it struggles to fight competitor Google.

One weaker spot was sales of its widely-used Windows product, which are slowing as tablet PC sales eat into demand for traditional PCs.

Microsoft is itself expected to enter the tablet market next year with the launch of its next operating system, code-named Windows 8, which will be compatible with the low-power chips commonly used by tablet and mobile phone makers.

Microsoft’s share price (MSFT) at around $27 is still some way off it’s record of $37.06 which was posted on 29 October 2007.

A portfolio of 6,000 patents was auctioned to realise some value from the assets of bankrupt telecoms firm Nortel.
Google lost the auction as a consortium including Apple and Microsoft made the winning bid of £2.8 billion.

The sale of the patent portfolio started as a five way scrap and boiled down to  two separate combined consortia and individual firms including Google and Intel.

Initial estimates suggested the portfolio would attract around £1.24 billion but the four days of intense bidding saw the total rise sharply.

As the bids got bigger some firms dropped out and others became partners to pool their resources. From going it alone, Apple joined a consortium that included Microsoft, Research In Motion and Sony.

Ultimately the portfolio was being fought over by two groups: Google and Intel on one side and the Microsoft/Apple-led consortium on the other.

Google’s bids for a pool of wireless patents were based on unusual mathematical theorems. During the sale, Google’s bids were based on pi, other constants and the distance between the Earth and the Sun.

“Google was bidding with numbers that were not even numbers,” a source involved in the auction told the Reuters news agency.

During its bids, Google picked numbers including Brun’s constant and Meissel-Mertens constant that were said to have “puzzled” others involved in the auction. When bids from rivals hit $3bn, Google reportedly bid pi, $3.14159bn, to up the ante.

“Either they were supremely confident or they were bored,” Reuters’ source said.

It is not clear what inspired Google to draw on obscure mathematics for its bids. However, Google co-founder Sergey Brin is widely acknowledged to be a maths prodigy and the bids may reveal his influence.

Currently Google had about 700 patents in its mobile portfolio, many of which relate to using handsets to serve its core competences such as search.

By contrast, he said, the Nortel patents relate to future technologies that will make mobile networks faster and handsets more powerful.

Owning the patents could also ease the burden on firms making Android devices as they would have fewer licence fees to pay.

Use of Android technology from Google is free provided handset makers pipe traffic back to the search giant so it can make money with adverts.

However, the numbers of companies asking for cash to use the non-Google developed technologies found in Android phones was rising, he said.

For instance, Microsoft has announced licensing deals with many Android phone makers including General Dynamics and HTC.

With the control of the patents passing to a consortium that includes firms that are Google’s bitter rivals in the mobile phone world, licence fees could increase.