Disruptions: Smartphone Battles Shift to Software

Eric Risberg/Associated Press Timothy D. Cook, Apple’s chief executive, on Monday at the company’s Worldwide Developers Conference in San Francisco.

SAN FRANCISCO — Last week, Timothy D. Cook, Apple’s chief executive, stood on stage at the company’s Worldwide Developers Conference without a new version of the iPhone or the iPad or some new device.

After showing off new laptop computers and a new, cylindrical Mac Pro, Mr. Cook and other Apple executives spent the rest of their two-hour keynote address discussing the features of Apple’s latest mobile operating system, iOS 7. With the image of a flattened smartphone interface with thin typography on a screen in the background, Mr. Cook proudly noted, “This is the biggest change to iOS since the introduction of the iPhone.”

How does he figure that?

Mr. Cook’s bold claim was based on something that is well understood in tech circles but is easily overlooked by consumers. It is the design of the software, far more than the look and feel of the device itself, that allows a company to leap over its competitors.

Hardware features like processing speed or screen resolution or even how well a camera works offer only fleeting advantages in the constant competition among smartphone manufacturers. And with more than a billion smartphones in the world today, much of them with the same rectangular design meant to fit in your hand yet large enough to be used as a phone, it is hard to imagine a breakthrough in their general look.

But changes to the software are limited only by the skill and creativity of a company’s engineers and designers and are not as easily mimicked since they appeal to softer notions like “experience” rather than speed or weight.

Designers at Apple, Microsoft and Google appear to have been keenly aware of that when they worked on the latest versions of their mobile operating systems, experimenting with ways of making software that is unique yet as intuitive as a road sign.

“I have my home, I have my office and I now I have my phone interface,” said Paola Antonelli, senior curator of architecture and design at the Museum of Modern Art in New York. “When you turn a smartphone off it is an enigmatic monolith; it’s the interface that not only animates it but gives it meaning.” Ms. Antonelli said she hoped to one day include iOS 7 in MoMA’s design collection.

Apple is making some stark changes to the appearance of its software with the latest operating system, which will be available to consumers in the fall. Jonathan Ive, senior vice president for industrial design at Apple and the executive responsible for the new look, has done away with design metaphors like a wood grain bookshelf for the phone’s virtual newsstand. The new look also eliminates borders. It doesn’t sound like much, but that allows apps to stretch across the screen, which makes the phone feel larger. By doing away with shadows and dark colors, the design makes the phone’s screen feel brighter, too.

Interestingly, until this update, among the digital technology community, Apple was losing its reputation for cutting-edge design as competitors like Microsoft experimented.

“From a design standpoint, Apple’s interface became pretty cheesy and predictable,” said Yves Béhar, the founder of Fuseproject, a San Francisco design agency that helped create the low-cost One Laptop Per Child PC and the Jawbone Up wristband health-monitoring device. “It lacked strength and vision.”

Microsoft, which was regularly criticized in recent years for the staid look of its software, has been pushing the design boundaries as it tries to play catch-up in smartphones. In a recent blog post on the company’s Web site, Steve Clayton, a design manager at Microsoft, wrote that company executives finally understood about three years ago that the look of the software was just as important as what the device could do.

The new appearance of the company’s operating system for mobile devices, Windows Phone 7, consists of an array of flat, colorful squares that can be easily moved around on the screen. Though when that tiles-based look was also applied to the Windows 8 PC operating system, some longtime customers complained it was too drastic.

But it has been good for the mobile business.

In the first quarter of 2013, Windows Phone nudged Blackberry to become the third most popular phone operating system globally, according to a report by IDC, a market research firm. Microsoft shipped seven million Windows Phone 7 devices in the first quarter, compared with 6.3 million Blackberry devices. Blackberry is trying to rebound with a new version of its phone with software that has also changed considerably from older versions.

Mr. Béhar said a good software design would always help sell more hardware.

“We are in an era where the 30-second TV ad doesn’t count anymore,” he said. “The product — the smartphone — is its own form of advertising today and a good experience, where people want to spend more time with the product, is what people see.”

E-mail: bilton@nytimes.com

Gadgetwise Blog: Free Lightroom 5 Photo Editing Software

Lightroom 5’s Radial Gradient feature can be used to create a vignette, where a picture darkens towards the edges.

Adobe Systems has begun giving away the newest version of its photo editing software, Lightroom 5. But there is a catch.

Lightroom 5 is a public beta test version of a sister product to Adobe’s Photoshop. Lightroom is easier to use than Photoshop, but just as powerful for making overall adjustments to things like color, shadows and contrast. However, it is not as good for extremely detailed editing and has fewer tools.

At the top of the list of Lightroom’s new features is an improved ability to erase and replace objects in photos. The older Lightroom was best at erasing small aberrations, like dust spots. The new Lightroom lets users pick a larger area in any shape to replace. It’s still not as powerful as the Photoshop tool called “Content Aware Fill,” but it’s close.

Adobe has also added a feature called Radial Gradient, which lets photographers draw a circular or oval area in which to apply effects. It can be used to create a vignette, where a picture darkens toward the edges, for instance. So you could circle someone’s face, and have the picture dim as it moves away from her, creating a spotlight to draw the eye.

A new feature called Upright examines the horizontal and vertical lines of a photo to correct for lens distortion. So if you shot a photo with a wide-angle lens, and things at the edges look warped, Upright would adjust it to look as though it had been photographed with a more neutral lens.

The Upright feature.

Slide shows can now include video clips, and you can make and save custom design pages for photo books. There are other enhancements as well.

So what is the catch? When the beta test is over, you won’t be able to use Lightroom 5 anymore unless you buy the new version. Upgrade pricing will be available to people who bought an earlier version of Lightroom.

Chinese Businessman Pleads Guilty in Stolen Software Case

The sophisticated software was stolen from an estimated 200 American manufacturers and sold to 325 black market buyers in 61 countries from 2008 to 2011, prosecutors said in court filings. U.S. buyers in 28 states included a NASA engineer and the chief scientist for a defense and law-enforcement contractor, prosecutors said.

Corporate victims in the case included Microsoft, Oracle, Rockwell Automation,, Agilent Technologies, Siemens, Delcam, Altera Corp and SAP, a government spokesman said.

U.S. officials and the Chinese man's lawyer, Mingli Chen, said the case was the first in which a businessman involved in pirating industrial software was lured from China by undercover agents and arrested.

The businessman, Xiang Li, of Chengdu, China, was arrested in June 2011, during an undercover sting by U.S. Department of Homeland Security agents on the Pacific island of Saipan, an American territory near Guam.

Video from the undercover meeting in Saipan, filed as evidence in court, is expected to be made public during a press conference Tuesday by John Morton, director of U.S. Immigration and Customs Enforcement, and Charles M. Oberly III, the U.S. Attorney for Delaware.

Li, 36, originally charged in a 46-count indictment, pleaded guilty late Monday to single counts of conspiracy to commit criminal copyright violations and wire fraud.

"I want to tell the court that what I did was wrong and illegal and I want to say I'm sorry," Li told U.S. District Judge Leonard P. Stark during a 90-minute hearing in federal court. The Chinese citizen spoke through a translator.

In a court filing, prosecutors David Hall and Edward McAndrew said the retail value of the programs Li sold on the black market exceeded $100 million.

During the hearing, Li told U.S. District Judge Leonard Stark that he disputes that figure. After the hearing, his lawyer said Li did not realize the retail value of what he was selling until he was caught and plans to present his own estimate at sentencing, which is set for May 3, he said.

In recent years, U.S. officials have targeted software pirates overseas but bringing them to the United States has proved difficult.

In one of the largest copyright cases, U.S. prosecutors last year charged seven people, including Megaupload founder Kim Dotcom, with racketeering conspiracy and copyright violations. The indictment alleges that Dotcom, who lives in New Zealand, ran an organization that earned $175 million selling an estimated $500 billion worth of pirated movies, TV shows and other entertainment media. Dotcom is fighting extradition from New Zealand.

EXPENSIVE SOFTWARE

The Li case involves sophisticated business software, not entertainment software, and thus small quantities of higher-priced products. The retail value of the products Li pirated ranged from several hundred dollars to more than $1 million apiece. He sold them online for as little as $20 to $1,200, according to government court filings.

At one point, Crack99.com and Li's other sites offered more than 2,000 pirated software titles, prosecutors said.

Li trolled black market Internet forums in search of hacked software, and people with the know-how to crack the passwords needed to run the program. Then he advertised them for sale on his websites. Li transferred the pirated programs to customers by sending compressed files via Gmail, or sent them hyperlinks to download servers, officials said.

"He was pretty proud of himself," Chen said of his client's business acumen. "He did not realize it was such a big crime."

Agents from Immigration and Customs Enforcement/Homeland Security Investigations learned of Li's enterprise after an unidentified U.S. manufacturer noticed his company's software for sale on crack99.com.

Working undercover for 18 months beginning in early 2010, the U.S. agents made at least five purchases from Li. These included pirated versions of "Satellite Tool Kit" by Analytical Graphics Inc. of Exton, Penn., a product prosecutors said is "designed to assist the military, aerospace and intelligence industries through scenario-based modules that simulate real-world situations, such as missile launches, warfare simulations and flight trajectories." Agents bought software worth $150,000 retail for several thousand dollars.

Agents lured Li from China to the U.S. territory of Saipan under the premise of discussing a joint illicit business venture. At an island hotel, Li delivered counterfeit packaging and, prosecutors said, "Twenty gigabytes of proprietary data obtained unlawfully from an American software company." Officials did not identify the company in court documents.

(Editing by Cynthia Osterman)

Antivirus Makers Work on Software to Catch Malware More Effectively

Consumers and businesses spend billions of dollars every year on antivirus software. But these programs rarely, if ever, block freshly minted computer viruses, experts say, because the virus creators move too quickly. That is prompting start-ups and other companies to get creative about new approaches to computer security.

“The bad guys are always trying to be a step ahead,” said Matthew D. Howard, a venture capitalist at Norwest Venture Partners who previously set up the security strategy at Cisco Systems. “And it doesn’t take a lot to be a step ahead.”

Computer viruses used to be the domain of digital mischief makers. But in the mid-2000s, when criminals discovered that malicious software could be profitable, the number of new viruses began to grow exponentially.

In 2000, there were fewer than a million new strains of malware, most of them the work of amateurs. By 2010, there were 49 million new strains, according to AV-Test, a German research institute that tests antivirus products.

The antivirus industry has grown as well, but experts say it is falling behind. By the time its products are able to block new viruses, it is often too late. The bad guys have already had their fun, siphoning out a company’s trade secrets, erasing data or emptying a consumer’s bank account.

A new study by Imperva, a data security firm in Redwood City, Calif., and students from the Technion-Israel Institute of Technology is the latest confirmation of this. Amichai Shulman, Imperva’s chief technology officer, and a group of researchers collected and analyzed 82 new computer viruses and put them up against more than 40 antivirus products, made by top companies like Microsoft, Symantec, McAfee and Kaspersky Lab. They found that the initial detection rate was less than 5 percent.

On average, it took almost a month for antivirus products to update their detection mechanisms and spot the new viruses. And two of the products with the best detection rates — Avast and Emsisoft — are available free; users are encouraged to pay for additional features. This despite the fact that consumers and businesses spent a combined $7.4 billion on antivirus software last year — nearly half of the $17.7 billion spent on security software in 2011, according to Gartner.

“Existing methodologies we’ve been protecting ourselves with have lost their efficacy,” said Ted Schlein, a security-focused investment partner at Kleiner Perkins Caufield & Byers. “This study is just another indicator of that. But the whole concept of detecting what is bad is a broken concept.”

Part of the problem is that antivirus products are inherently reactive. Just as medical researchers have to study a virus before they can create a vaccine, antivirus makers must capture a computer virus, take it apart and identify its “signature” — unique signs in its code — before they can write a program that removes it.

That process can take as little as a few hours or as long as several years. In May, researchers at Kaspersky Lab discovered Flame, a complex piece of malware that had been stealing data from computers for an estimated five years.

Mikko H. Hypponen, chief researcher at F-Secure, called Flame “a spectacular failure” for the antivirus industry. “We really should have been able to do better,” he wrote in an essay for Wired.com after Flame’s discovery. “But we didn’t. We were out of our league in our own game.”

Symantec and McAfee, which built their businesses on antivirus products, have begun to acknowledge their limitations and to try new approaches. The word “antivirus” does not appear once on their home pages. Symantec rebranded its popular antivirus packages: its consumer product is now called Norton Internet Security, and its corporate offering is now Symantec Endpoint Protection.

“Nobody is saying antivirus is enough,” said Kevin Haley, Symantec’s director of security response. Mr. Haley said Symantec’s antivirus products included a handful of new technologies, like behavior-based blocking, which looks at some 30 characteristics of a file, including when it was created and where else it has been installed, before allowing it to run. “In over two-thirds of cases, malware is detected by one of these other technologies,” he said.

Bits Blog: In Shake-Up, Apple's Mobile Software and Retail Chiefs to Depart

Jeff Chiu/Associated Press Scott Forstall at an Apple event in September.

Scott Forstall, who has run software development for Apple’s iPad and iPhone products, and John Browett, the head of the company’s retail operations, are leaving Apple, in a rare management shake-up at the company.

The departure of Mr. Forstall, an Apple veteran, will shift his responsibilities to several other Apple executives. Most notably, Eddy Cue, the head of Apple’s Internet services, will take over development of Siri and maps, two efforts Mr. Forstall oversaw that have been widely criticized for their reliability and accuracy.

Apple said in a news release that the management changes would “encourage even more collaboration” at the company. Mr. Forstall will leave Apple next year and serve as an adviser to Tim Cook, the chief executive, in the meantime.

Dixons Retails, via Associated Press John Browlett

Jony Ive, the head of Apple’s industrial design, will take on more software responsibilities by providing more “leadership and direction for Human Interface,” Apple said. Craig Federighi, who was previously in charge of Apple’s Mac software development, will also lead development of iOS, the software for iPads and iPhones.

The departure of Mr. Browett, who joined Apple only in April to lead its retail operations, followed a number of missteps by him. In August, Apple took the unusual step of apologizing for a plan to cut back on staffing at its stores. Apple said that a search for a new head of retail was under way and that the retail team would report directly to Mr. Cook.