New products boosting Microsoft

Demand for new products such as the Vista Windows system saw Microsoft make profits of $3.03bn (£1.47bn) in the past quarter, up 11% on last year.

For 2007-2008 as a whole, the software giant reported a $14bn profit on total sales of more than $51.1bn.

Profits in the past three months were hampered by costs stemming from repairs to the Xbox 360 computer games console.

Microsoft said its core businesses were "healthy" and it would continue to invest in growth opportunities.

Innovation

Microsoft acknowledged this month that it is facing a bill of more than $1bn to cover the cost of offering extended warranties to Xbox 360 owners after problems with the console.

Surpassing $50bn in annual sales is a testament to the innovation and value that our product groups delivered
Kevin Turner, Microsoft

Excluding these charges, the firm would have made a fourth quarter profit of $3.78bn.
Sales from the division which includes Vista, launched in January, rose 14% to $38.1bn in the past three months.

Total sales rose 13% to $13.3bn over the same period.

Microsoft said it had had an extremely strong year.

"Surpassing $50bn in annual sales is a testament to the innovation and value that our product groups delivered into the marketplace," said chief operating officer Kevin Turner.

In the upcoming year, Microsoft said it expected sales to rise to between $56bn and $57bn.

Microsoft shares rose nearly 2% before it announced its results but fell in after-hours trading amid concerns it had only met market expectations not exceeded them.

Microsoft’s copy protection cracked... again!

Seattle: Microsoft is once again on the defensive against hackers after the launch of a new program that gives average PC users tools to unlock copy-protected digital music and movies.

The latest version of the program, FairUse4M, which can crack Microsoft’s digital rights management (DRM) system for Windows Media audio and video files, was published online late Friday.

FairUse4M has a simple drag-and-drop interface. And PC users can turn the protected music files they bought online into DRM-free tunes that can be copied and shared, or converted into MP3 files.

“We knew at the start that no DRM technology is going to be impervious to circumvention,” said Jonathan Usher, a director in Microsoft’s consumer media technology group.

He did not say how many songs have been stripped of copy protection, or how long it will take for Microsoft to combat the hack again.

But the music industry is aware of the nature of Microsoft’s technology, he said, and added that he does not expect record labels to lose patience with the process.

While Usher said Microsoft will remain committed to copy protection, attitudes around the industry are starting to shift.

Apple’s chief, Steve Jobs, for one, has started calling for an end to digital music-locking earlier this year. In fact, Apple, as well as Web retailer Amazon.com, have already jumped on the DRM-free bandwagon.

Josh Bernoff, an industry analyst, said he expects music DRM to fade out in the next few years as record companies begin to realise selling unprotected tracks online won’t hurt sales.