With the PlayStation 3 not generating the revenue Sony expected, it now appears that the company is looking at in-game advertising to turn its gaming division around. The new division will be headed by Darlene Kindler, a two-and-a-half decade veteran of the consumer electronics industry. She will assume the title of network advertising director, and report to Sales and Business Development chief Phil Rosenberg.

Kindler will be tasked with developing an in-game advertising strategy for all of Sony's PlayStation platforms, as well as advertising within the PlayStation Network. She had most recently worked with Adscape Media, an in-game advertising company that was acquired by Google in March, and previous to that had worked at Nintendo as part of the company's start-up team. Sony did not say when the advertising would begin to appear in its games.

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Microsoft said Monday that it will begin bundling two free games worth $90 with its standard $349.99 USD package and the Xbox 360 Elite in order to entice new consumers to the console. The games include Forza Motorsport 2 and Marvel Ultimate Alliance when they begin appearing at retailers in October. While many are expecting Microsoft to also release its replacement for the Core system, called "Xbox 360 Arcade," no announcement was made as of yet.

The console, which has been out since November 2005, has one of the broadest game lineups of the three next-generation systems. Besides Halo 3, the console currenty has six other titles expected to sell over a million units, including BioShock, Project Gotham Racing 4, Mass Effect, Guitar Hero III, and Call of Duty 4. 21 of the top 30 best rated games on Metacrtic.com are Xbox titles, Microsoft added.

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While countless observers of the absurdly long SCO trials against IBM and Novell have already stuck their proverbial forks in the matter, after SCO's Chapter 11 bankruptcy filing last month, Novell filed a motion in Utah District Court last week arguing that lifting a stay of SCO's lawsuit against it would not only be beneficial in the long run, but may actually be beneficial to SCO's survival.

"The District Court Order has special importance for SCO's attempt to reorganize," argued Novell's attorneys. "It already makes SCO's current business model questionable. The only periods in which SCO appears to have been profitable are those periods in which it generated substantial one-time revenues through transactions wrongfully based on Novell's property [licensing of its UNIX trademarks and copyrights for royalties]. When not based on Novell's property, SCO's historic business model does not appear to be profitable or provide SCO with reasonable prospects for reorganization."

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Cerulean Studios said Friday that it was in the process of developing a version of its client for the Mac, encroaching on territory long occupied by competitor Adium. Trillian did for Windows what Adium does for Mac - allow the user to load one program for multiple instant messaging clients. Cerulean has released an alpha build of the client, which it says is roughly the same as a flash-based version of the client, which basically allows for simple IM.

With the new v4.x iterations of Trillian, the codebase was separated from the user interface, which was made platform-agnostic. Thus, the Mac OS X version will have all the features of the Windows version, however, it will be affected by the limitations of the UI. Cerulean said that as the UI is developed, these features will appear in the Mac client.

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McDonald's said over the weekend that it planned to offer free wireless access in its restaurants across the UK. The company already offers Wi-Fi in many of its US locations, however it is only free to those using the Nintendo DS - others are charged a nominal fee. All 1,200 restaurants in the region will offer the service, which would make it the largest provider of wireless access.

When complete, the restaurant's network will account for about 10 percent of all hotspots in Britain. The country currently has about 12,000 hotspots, provided by The Cloud, BT, and T-Mobile, along with other smaller carriers. The average price for an hour of usage is around 5 pounds ($10.18), so a free McDonald's service with such wide reach could have the effect of lowering access prices for other premium services.

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Without providing any public reason, two of the chief developers behind Mozilla's Thunderbird client announced their intentions to leave ahead of the e-mail client's split from the company.

The moves are all the more puzzling considering there was never any indication that either Scott MacGregor nor David Bienvenu did not support the restructuring of Mozilla to focus on Firefox.

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MSNBC.com has acquired social networking site Newsvine in order to stake its claim in the growing "citizen journalism" movement occurring in the broader media industry.

The acquisition is MSNBC.com's first in its 11-year history. MSNBC is a joint venture between Microsoft and NBC, with the Web site acting as an extension of the online television network.

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Forestalling a possible injunction of the sale of its voice-over-IP services that would likely have crippled the company, Vonage agreed this morning to pay Sprint Nextel a one-time fee of $80 million, for a license covering all past and future usage of Sprint's intellectual property. Two weeks ago, a jury found Vonage infringed upon Sprint's patents in the VoIP field, and had been ordered to pay $69.5 million plus 5% of its future revenues.

The deal effectively ends one of two disputes with major patent holders with whom Vonage has been competing for business. The other is with Verizon, and the judge in that case may yet issue an injunction unless Vonage has an inclination to settle there as well.

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A Georgia man has escaped injury after the iPod nano he owned caught fire inside of his pocket, the exact cause of which is not yet known. Danny Williams of Douglassville, Georgia said all that protected him from burns was a piece of glossy paper that he had in his pocket along with the device. The burning nano did, however, burn a hole in the man's pants.

Williams works at a kiosk Hartsfield-Jackson Atlanta International Airport. He said the incident could have posed a big problem: "If TSA had come by and seen me smoking, they could have honestly thought I was a terrorist," he told WSB-TV. According to Willams' parents, Apple has said it would replace the unit. Apple has so far refused to comment on the incident.

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Microsoft has announced that it will issue seven security bulletins on Tuesday, fixing issues in Windows, Office and Outlook Express. Four of the patches will cover "Critical" vulnerabilities while another three deal with problems rated "Important."

The four critical issues involve remote code execution on Windows and in Office. The Important fixes are for denial of service, spoofing and elevation of privilege flaws. Each month, Microsoft announces details of upcoming patches the week before, but does not go into specifics of what vulnerabilities are covered. Separately, three non-security, high-priority updates will be released Tuesday on Microsoft Update with another being delivered via Windows Update.

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A bill attempting to reconcile a journalist's right to protect its sources with the federal government's need to know timely and critical information, passed the Senate Judiciary Committee yesterday, but not without more exceptions having been added to the original House version. Still, the bill continues to define journalists rather loosely, leading some to believe federal protection could yet extend to independent, often solo bloggers.

Specifically, S. 2035, the Free Flow of Information Act, doesn't even use the word "journalist." Instead it refers to a person covered by protections of the Act, and defines that person as someone engaged in journalism. It then defines "journalism" as "the regular gathering, preparing, collecting, photographing, recording, writing, editing, reporting, or publishing of news or information that concerns local, national, or international events or other matters of public interest for dissemination to the public."

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In the midst of increased competition from the iPhone, BlackBerry maker RIM posted a higher than expected profit and strong subscriber numbers.

Some analysts had predicted that the release of the iPhone might have a negative impact on RIM's overall business. However, at least for now the company is doing well in spite of those concerns.

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With the next wave of interactive features having been added to 20th Century-Fox's latest Blu-Ray Disc releases, Fantastic Four: Rise of the Silver Surfer and The Day After Tomorrow, there was always a certain level of anticipation that some existing Blu-ray consoles would have trouble, especially the first-generation editions. Surprisingly, it's the second generation which is seeing some early problems, with reports from owners of Samsung's BD-P1200 that they can't play either of these titles.

"You know, this really sucks...how much did we pay for the freaking things?" asked one AVS Forum member on Tuesday. "It's bad enough you have to choose sides to play certain movies, but now some don't even work."

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Microsoft sent out an e-mail to Windows Vista SP1 and Windows Server 2008 beta testers, announcing the arrival of the Windows XP Service Pack 3 Beta Preview. Microsoft reiterated that this will be the final update for the aging operating system, which debuted in 2001.

No new features are planned for what is essentially a roll-up of existing updates. As Windows XP nears its end-of-life, Microsoft can ensure customers are up-to-date by telling them to upgrade to SP3, as opposed to SP2 with over one hundred additional patches. Final availability of XP SP3 is scheduled for the first half of 2008.

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Sony said Thursday that it had sold 500,000 units of its updated PlayStation Portable model in Japan. While sales have cooled significantly since its September 20 launch when 250,000 were sold in a mere four days, it was still a blockbuster month for the device. Sales were the highest since December 2004, the month the original PSP launched.

The PSP led all other consoles -- including the set-top ones -- during the week of September 24 to 30 in Japan, according to figures from MediaCreate. The device sold 102,809 units, significantly more than second place Nintendo DS at 72,895. The closest console was the Wii, which sold 24,143 consoles, the firm said.

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