Apple, Android top Amazon sales

The online retailing giant said the best-selling computer on its site in 2010 was Apple's (NMS:AAPL) MacBook Pro 13.3-inch laptop, while the top wireless device was Samsung's Captivate phone running on Google's (NMS:GOOG) Android OS with an AT&T (NYSE:T - News) contract. The best-selling software was Microsoft's (NMS:MSFT) Office 2010 Home & Student. The top electronic product was Amazon's (NMS:AMZN) Kindle, which the company said Mon. was its best-selling item of all time. Amazon dipped 0.3% to 182.75.

2010: The Year Facebook Dethroned Google as King of the Web [STATS]

Facebook was not only the most searched item of the year, but it passed Google as America's most-visited website in 2010, according to a new report from Experian Hitwise.

For the second year in a row, "facebook" was the top search term among U.S. Internet users. The search term accounted for 2.11% of all searches, according to Hitwise. Even more impressive is the fact that three other variations of Facebook made it into the top ten: "facebook login" at #2, "facebook.com" at #6 and "www.facebook.com" at #9. Combined, they accounted for 3.48% of all searches, a 207% increase from Facebook's position last year.

Rounding out the list of top search terms were YouTube, Craigslist, MySpace, eBay, Yahoo and Mapquest. Other companies that made big moves in terms of searches include Hulu, Netflix, Verizon, and ESPN. The search term "games" also made its first appearance in the list of Hitwise's top 50 search terms.

More interesting though is Facebook's ascension to #1 on Hitwise's list of most-visited websites. The social network accounted for 8.93% of all U.S. visits in 2010 (January-November), beating Google (7.19%), Yahoo Mail (3.52%), Yahoo (3.30%) and YouTube (2.65%). However, Facebook didn't beat the traffic garnered by all of Google's properties combined (9.85%).

It's only a matter of time until Facebook topples the entire Google empire, though. We've seen the trend develop for month: Facebook is getting bigger than Google. According to comScore, Facebook's U.S. traffic grew by 55% in the last year and has shown no sign of slowing down.

Chrome OS gives a peek at computing future

What if nearly everything you usually keep on your computer — photos, documents, music and software — was stored online? Your machine would be speedier and perhaps less vital because you could simply use another machine to recoup your digital life should you lose your laptop.

This premise — somewhat scary, yet liberating — is behind Google Inc.'s upcoming Chrome OS, which will make notebook computers more like netbooks than most actual netbooks.

The software powering Chrome OS, which is based on the search giant's eponymously named browser, serves mainly as a tool for connecting your computer to the Web. That's where nearly everything you use is housed and linked to your Google username and password. It's a concept known as cloud computing.

A peek at the upcoming operating system and its vision of cloud computing shows a promising idea that could make computing faster and more convenient. But it still needs a lot of work.

Google expects the first computers powered by Chrome OS to be released this summer, and initially they'll be made by Acer Inc. and Samsung Electronics Co.

For now, though, Google is operating a pilot for some individuals and companies to test an unbranded laptop that runs Chrome OS. The company lent The Associated Press one of these machines, which aren't going to be sold to the public.

The laptop itself, called the Cr-48, doesn't really deserve to be critiqued, because it is a stripped-down machine that is chiefly a frame for Google's OS oeuvre. The shell is entirely matte black plastic, without a hint of branding. It has a webcam, a screen that is about 12 inches diagonally and a full-sized keyboard with a search key in place of the caps lock key.

The machine also has 16 gigabytes of flash memory for storing files, if you feel absolutely compelled to download something. Downloads are obviously discouraged, though; my music collection alone would nearly fill this allotment.

Moving on to the main event, Chrome OS brings a few clear benefits: Starting up the notebook takes just seconds — roughly 13 of them, according to my stopwatch — and waking the closed notebook from "sleep" mode is as quick as opening it up (almost too quick, as the notebook couldn't regain its wireless service quite as fast). By contrast, my Windows machine at work takes more than two minutes to boot up.

After you sign in with your Google account, the same username and password you would use to access Gmail, you can pull up a home page showing all the apps you've installed from the Chrome Web Store. Assuming you're connected to the Web, you can just start using apps and surfing the Web right away.

There were plenty of free and paid Web apps and browser extensions available when I tested the notebook. Some are only for the Chrome OS; others also work with Google's Chrome Web browser for other computers.

I installed a range of the free ones, some of which seemed to be just links to existing Web pages. The apps I snagged included Web-based office suite Google Docs, the chatting service Google Talk, Aviary's Advanced Image Editor and balloon-popping puzzle game Poppit.

As with smart phones and tablets such as Apple Inc.'s iPad, publications are also making Chrome apps. USA Today, The New York Times and The Wall Street Journal are among them.

On my work computer, it can take ages to open up applications that are stored on my hard drive. With the Cr-48, I could immediately start editing a Google Docs spreadsheet or tweak the colors in a photo using Aviary because the programs are all running online. I only needed a strong Internet connection.

Surfing the Web was a pretty normal experience, with most websites loading speedily, though the Cr-48 was not that good at displaying Flash videos.

But I felt constrained because I had to use the lone browser that comes with the system and the Web-based apps I obtained. Apps loaded slowly when my Internet connection wasn't stellar. This wouldn't be a problem with programs stored on a regular computer's hard drive.

If a Chrome OS-based laptop becomes my primary computer, a data plan would be a must.

I feel anxious just thinking about the possibility that I couldn't access my documents at any time, and I don't even keep anything that important on my own laptop.

I mostly used the notebook with Wi-Fi at home and at the office, though I also tried out its 3G network service, which is provide by Verizon Wireless.

So what happens if you don't have any Internet access? The Cr-48 is pretty useless.

I could still write in an already-open Google Docs document, add notes in Scratchpad and look at photos I'd downloaded. But I couldn't use apps that are not yet opened because they're all connected to the Web.

If you lose your connection while using an app, you may be able to view some information that has been temporarily stored in memory, as I could when browsing The New York Times' app. But you'll need to get online as soon as possible to really use the machine. Faced with this situation, I'd probably just search frantically for an Internet connection or simply put away my laptop.

In its current state, the Chrome OS is far from ready to take over as my main computer, even if I were using it on a more powerful machine than the Cr-48.

Sure, I spend most of my time on the Web already, but I'm not quite ready to rely on having Internet access to do almost anything with my computer.

I can imagine getting comfortable with that in the not-so-distant future, though, and I'm curious to see if Google can make it happen.

Apple boots WikiLeaks app from iPhone store

Apple yesterday pulled an iPhone app from the App Store that let users read secret U.S. diplomatic cables published by WikiLeaks and follow the controversial organization's Twitter feed.

According to Igor Barinov, the general manager of Moscow-based Hint Solutions, Apple yanked his WikiLeaks App from the App Store shortly after noon on Monday. Barinov posted several screenshots of his program's App Store status as proof.

Tuesday, Barinov said that Apple had called to tell him it would provide an official reason for removing his app in a day or two. In a Twitter message, Barinov said Apple had referred him to several clauses in the App Store developer guidelines, including one that read: "Any app that is defamatory, offensive, mean-spirited, or likely to place the targeted individual or group in harms [sic] way will be rejected."

"They named points of apple dev guideline which bans app forever," Barinov said on Twitter.

Apple's move was the latest in a string made by U.S. companies, including Amazon, Bank of America, MasterCard and PayPal, that have terminated services for WikiLeaks.

In late November, the organization began publishing U.S. State Department messages. Since then, WikiLeaks shifted its site to new hosting providers several times; its founder, Julian Assange, was arrested in the U.K. and then posted bail; and pro-WikiLeaks activists launched distributed denial-of-service (DDoS) attacks against the firms that withdrew services.

In a Monday press release, Barinov said that $US1 from the sale of each copy of the $1.99 app would be earmarked to "help fund the legal defense costs in the event that high- profile Internet journalists will be charged in a United States Court" for writing about the WikiLeaks cache of U.S. documents.

WikiLeaks does not charge to access its content.

Tuesday morning, Barinov said that his app had been downloaded 4,434 times, and he would contribute $4434 to WikiLeaks from his profit of $5825.

Apple takes a 30 per cent cut of all revenue on the App Store; if Borinov's numbers are accurate, Apple would have made approximately $2500 on the sale of the app.

Neither Barinov or Apple replied Tuesday to requests for comment or to additional questions.

Twitter financing values company at $3.7 billion

Twitter has raised $200 million of financing in a deal that values the microblogging company at $3.7 billion, less than a year after it began its first serious efforts to make money.

The funding, from Silicon Valley venture capital firm Kleiner Perkins Caufield & Byers and existing Twitter investors, underscores the high hopes that investors have for Internet social networking companies.

"It's a huge multiple. But the idea is that (Twitter's) scale can be monetized," said BGC Partners analyst Colin Gillis, who estimated that Twitter's annual revenue was currently under $100 million.

The money will help Twitter expand the company, Twitter said in a post on its corporate blog on Wednesday. The blog post did not elaborate and a spokesman declined to offer specifics.

Twitter, which had 175 million users as of September, is among the new crop of quickly growing Internet social networking services. Others include Facebook and Zynga.

Facebook, the world's No. 1 Internet social networking company, is valued at more than $45 billion in recent stock purchase transactions on the secondary market, according to Sharespost, an online exchange for trading shares in private companies.

Investors are watching services like Facebook and Twitter closely, hoping one day to buy public shares of the company.

BGC's Gillis said Twitter's new valuation could push an IPO further down the road, as Twitter would need to "grow into the valuation" and generate more revenue to justify it to public market investors.

But Caris & Co analyst Sandeep Aggarwal said he believed Twitter could be an IPO candidate as soon as 2011, particularly as the company could need more funding to capitalize on new opportunities.

"These companies are hungry for resources," said Aggarwal.

Twitter also announced on Wednesday that it had added two new board members -- FlipBoard Chief Executive Mike McCue and DoubleClick CEO David Rosenblatt.

The moves come two months after the four-year-old company handed the job of chief executive to Dick Costolo, the architect of its new advertising efforts, a sign that making money is a priority for the service.

Costolo told Reuters in May that Twitter planned to have hundreds of advertisers using its ad system by the end of the year. He said the company's previous valuation of $1 billion meant that it was incumbent on Twitter to develop a business that can generate hundreds of millions of dollars of revenue.

Twitter had raised $160 million in four earlier funding rounds, from investors that included Spark Capital, Institutional Venture Partners and mutual fund company T. Rowe Price.

Technology blog AllThingsDigital first reported the $200 million funding round. It said that Kleiner Perkins beat out Russian investment firm DST Global. The Twitter spokesman confirmed that the figures were accurate.

Twitter, which allows users to send 140-character text messages, or Tweets, to followers, has become a popular communications tool for celebrities, politicians and businesses, and has played a role in several geopolitical events, such as the 2009 post-election demonstrations in Iran.

The service, along with Facebook, is increasingly challenging established Web services like Google Inc and Yahoo Inc for the time that consumers spend online.

2010 -- the year tablet computers came of age

Yearning for a gadget that was bigger than a smartphone but smaller than a laptop made tablet computing a defining trend for 2010.

The iPad, launched in April by Apple, became the must-have device of the year -- and has rivals intent on dethroning the culture-shifting California company before it can lock in the market the way iPods became the ruling MP3 players.

"Apple nailed it and made tablet computers a success," said Gartner analyst Ken Dulaney. "There are going to be a lot of people trying to beat them but it will turn out like iPods; everybody wants one."

Work weeks have grown steadily longer with the proliferation of gadgets keeping people connected to bosses and offices nights and weekends.

Our Internet Age lifestyles set the stage for the debut of a tablet computer done right, according to Forrester Research analyst Sarah Rotman Epps.

"Consumers are working all the time, have less leisure time and less money to spend but still want to maximize enjoyment they get out of life," Rotman Epps told AFP.

"Tablets fill that demand for devices that fill those in-between moments and minimize your unconnected time," she said.

Forrester data shows that 26 percent of US consumers who bought iPads use the tablets for work as well as personal purposes.

The top spot for using an iPad is the living room, with the bedroom being the second most common, according to Forrester.

"People are using tablets to read the Wall Street Journal or watch TV in bed," Rotman Epps said. "It is replacing, in some circumstances, laptop computers, television and print media."

Apple benefited by focusing on regular people instead of businesses, adding its hip cache and having real-world stores where people could try iPads before committing to buying devices, according to Rotman Epps.

"Apple cracked the market that others had struggled with for years," said Gartner analyst Michael Gartenberg.

Research shows that owners of the Apple tablets consume more video, news and other content online than other people do.

Some analysts expect iPad sales will blast past the 10 million mark this month, if they haven't already, and competitors are hitting the market with their own tablets or have announced plans to do so.

Samsung said its Galaxy Tab, which is powered by Google's Android software, has sold one million units. Microsoft considers tablets a "priority" and Blackberry maker Research in Motion plans one next year named the PlayBook.

Forrester predicted that by 2015, the number of US consumers using tablet computers would be 75 million: more than netbook users but less than the number of people using smartphones or laptops.

The tablet trend will put downward pressure on laptop computer prices, based on Forrester research indicating consumers think it's not worth paying a lot more to get a laptop instead of a tablet.

"Tablets really changed consumer thinking about mobile computing and the industry's thinking," said Forrester analyst Charles Golvin.

Analysts said the other big consumer electronics stories of the year were the continued growth of smartphones and Microsoft's Kinect, the Xbox 360 videogame console that players control using gestures and spoken commands.

Microsoft said it sold more than 2.5 million Kinects for Xbox 360 devices worldwide in the 25 days after they hit the market.

Google, meanwhile, said more than 300,000 smartphones running its Android software are activated daily as it builds momentum in the hot mobile market.

According to research firm Gartner, Finland's Nokia sold 29.5 million smartphones during the third quarter of the year for a 36.6 percent share of the worldwide market, down from 44.6 percent a year ago.

Sales of Android-powered smartphones soared to 20.5 million units, giving the Android platform a 25.5 percent market share, up from just 3.5 percent a year ago, Gartner said.

Apple's iPhone was next on sales of 13.5 million units followed by Canada's Research In Motion, maker of the BlackBerry, with sales of 11.9 million units and Microsoft's Windows Mobile with sales of 2.2 million units.

Companies beware: The next big leak could be yours

WikiLeaks' release of secret government communications should serve as a warning to the nation's biggest companies: You're next.

Computer experts have warned for years about the threat posed by disgruntled insiders and by poorly crafted security policies, which give too much access to confidential data. And there is nothing about WikiLeaks' release of U.S. diplomatic documents to suggest that the group can't — or won't — use the same methods to reveal the secrets of powerful corporations.

And as WikiLeaks claims it has incriminating documents from a major U.S. bank, possibly Bank of America, there's new urgency to addressing information security inside corporations and a reminder of its limits when confronted with a determined insider.

At risk are companies' innermost secrets — e-mails, documents, databases and internal websites that are thought locked to the outside world. Companies create records of every decision they make, whether it's rolling out new products, pursuing acquisitions, fighting legislation, foiling rivals or allowing executives to sell stock.

Although it's easy technologically to limit who in a company sees specific types of information, many companies leave access far too open. And despite the best of intentions, mistakes happen and settings can become inadvertently broad, especially as networks grow more complex with reorganizations and acquisitions.

And even when security technology is doing its job, it's a poor match if someone with legitimate access decides to go rogue.

With the right access, a cheap thumb drive and a vendetta are the only ingredients an insider needs to obtain and leak secrets. By contrast, outside attackers often have to compromise personal computers at the bottom of the food chain, then use their skills and guile in hopes of working their way up.

Employees go rogue all the time — for ego, to expose hypocrisy, to exact revenge or simply for greed.

A former analyst with mortgage lender Countrywide Financial Corp., now owned by Bank of America, is awaiting trial on charges he downloaded data on potentially 2 million customers over two years, charging $500 for each batch of 20,000 profiles. Prosecutors say the analyst worked secretly on Sundays, using an unsecured Countrywide computer that allowed downloads to personal thumb drives. Other home loan companies bought the customer profiles, including Social Security numbers, for new sales leads, according to authorities.

Also, an employee with Certegy Check Services Inc., a check authorization service, was accused of stealing information on more than 8 million people and selling it to telemarketers for a haul of $580,000. The worker was sentenced in 2008 to nearly five years in prison.

Despite the repeated warnings, many large companies lack clear policies on who should have access to certain data, said Christopher Glyer, a manager with the Mandiant Corp., an Alexandria, Va.-based security firm that investigates computer intrusions.

WikiLeaks argues that revealing details of companies and governments behaving badly, no matter how the information is obtained, is good for democracy.

Julian Assange, WikiLeaks' founder, told Forbes magazine that the number of leaks his site gets has been increasing "exponentially" as the site has gotten more publicity. He said it sometimes numbers in the thousands per day.

Assange told Forbes that half the unpublished material his organization has is about the private sector, including a "megaleak" involving a bank. He would not name the bank, but he said last year in an interview with Computerworld that he has several gigabytes of data from a Bank of America executive's hard drive.

Assange also told Forbes that Wikileaks has "lots" of information on BP PLC, the London-based oil company under fire for the massive Gulf of Mexico oil spill. Assange said his organization is trying to figure out if its information on BP is unique.

WikiLeaks previously published confidential documents from the Swiss bank Julius Baer and the Kaupthing Bank in Iceland. The site also published an operation manual for the U.S. prison in Guantanamo Bay, Cuba.

WikiLeaks' most recent leaks exposed frank and sometimes embarrassing communications from diplomats and world leaders. They included inflammatory assessments of their counterparts and international hot spots such as Iran and North Korea.

The prime suspect in the diplomatic leaks, Army Pfc. Bradley Manning, is being held in a maximum-security military brig at Quantico, Va., charged in connection with an earlier WikiLeaks release: video of a 2007 U.S. Apache helicopter attack in Baghdad that killed a Reuters news photographer and his driver.

Military investigators say Manning is a person of interest in the leak of nearly 77,000 Afghan war records WikiLeaks published online in July. Though Manning has not been charged in the latest release of internal U.S. government documents, WikiLeaks has hailed him as a hero.

Manning boasted to a hacker confidant that security was so flimsy he was able to bring a homemade music CD into work, delete its contents and fill it with secrets, according to a log of the exchange posted by Wired.com.

Experts said a key flaw in the military's security was that Manning may not have even had to look all that hard for the data, as it was apparently available for many people to see. The Defense Department says it has bolstered its computer security since the leaks.

Companies have many options technologically to protect themselves.

Alfred Huger, vice president of engineering for security firm Immunet Corp. in Palo Alto, said companies could simply configure their e-mail servers to restrict who certain people can send documents to.

Other measures include prohibiting certain people from copying and pasting from documents, blocking downloads to thumb drives and CD-ROMs, and deploying technologies that check if executives' e-mail messages are being checked too often — a sign that an automated program is copying the contents.

But the more companies control information, the more difficult it is for employees to access documents they are authorized to view. That lowers productivity and increases costs in the form of the additional help from technicians.

"You run the risk of creating an environment that's so rigid that people can't do their jobs," Huger said. "You have to find that balance. Unfortunately, there's no panacea against it."