Federal Communications Commission Chairman Julius Genachowski on Monday unveiled a plan to overhaul a much-criticized program that helps provide phone service to far-flung rural areas, proposing to focus it on expanding high-speed Internet access to those same locations.

The $8-billion Universal Service Fund is paid for by telecommunications companies, who must contribute a percentage of their long-distance revenue, often passing those fees on to their customers. The decades-old program has successfully spread phone service to residents in hard-to-reach areas that often are unprofitable for companies to serve, Genachowski said in a speech to the Information Technology and Innovation Foundation.

But the fund has become highly inefficient, he said. In some cases, it pays more than $20,000 a year to provide a single home with phone service.

"The program is still designed to support traditional telephone service. It’s a 20th century program poorly suited for the challenges of a 21st century world," Genachowski said. "In its current state, the program is not getting the job done. It’s leaving millions on the outside looking in, and wasting taxpayer dollars every year."

Reforming the Universal Service Fund was a priority of the FCC's National Broadband Plan, which was released last year with a goal of ensuring that at least 100 million homes have access to affordable  networks delivering Internet services at speeds much faster than today by 2015.

Genachowski said in an interview that his main goal is to modernize and streamline the fund.

"We want to eliminate the waste and inefficiency from the program as it exists now and then use those savings to fund Internet service in unserved America," he said.

Genachowski's plan calls for major changes, particularly to the complex payments known as Intercarrier Compensation that telecommunications pay each other as they transmit calls over their networks. He wants to use the savings from that and other changes to help pay for a new Connect America Fund.

"At the end of this transition, we would no longer subsidize telephone networks; instead we would support broadband," Genachowski said in his speech. "As we do this, we will make sure that all Americans continue to have access to voice service and can make calls from their homes. Voice will be ultimately one application that consumers can use over their fixed or mobile broadband connections."

The FCC is set to take an initial vote on the plan Tuesday, starting the process of receiving public comments on the new rules.

Telecommunications companies have pressed for years for changes to the Universal Service Fund and Genachowski said he has received positive feedback from the industry to his ideas.

"There’s certainly difference of opinion about the best way to fix it. Those are questions we have to resolve," he said in the interview. "It’s understood the program itself is unsustainable."

Verizon said it supported Genachowski's call for changing the fund and said he presented " a good road map."

But Genachowski is wading into controversial territory. Some rural lawmakers want the Universal Service Fund expanded to extend high-speed Internet access, while others have called for the fund to be eliminated because they said it is no longer necessary.

Genachowski said he's trying to chart a middle course and rejected calls for killing the fund.

"While the world has changed, the importance of universal service has not," he said in his speech. "We simply shouldn’t let millions of Americans be bypassed by the broadband revolution."

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-- Jim Puzzanghera

 Photo: FCC Chairman Julius Genachowski. Credit: Los Angeles Times

Wael Ghonim, the Google executive who has been missing since participating in the first few anti-government protests in Egypt, was released on Monday, according to reports from Al Jazeera.

The Times' Alexandra Zavis reported the news on our sister blog, Babylon & Beyond:

A brother of Wael Ghonim, Google's head of marketing for the Middle East and North Africa, told the network he was freed Monday and was on his way to Tahrir Square, the center of anti-government protests in Cairo.

Officials as Google were unavailable for comment on Monday morning.

Al Jazeera English posted a video on YouTube, which can be seen above, reporting that Ghonim was released on Monday.

Ghonim is Google's head of marketing for the Middle East and North Africa and has been reported missing since Jan. 27, after taking part in protests that began on Jan. 25.

Many anti-government demonstrators in Egypt have said for days that they believed Ghonim was being detained by the Egyptian government.

But the Egyptian government hadn't confirmed that it was holding Ghonim until Sunday night, when the state-owned station Nile TV said that was the case.

Nile TV reported that Prime Minister Ahmed Shafiq had called the network to announce Ghonim's Monday release.

Naguib Sawiris, an Egyptian businessman also told a TV station that he owns, that he had been assured by Vice President Omar Suleiman that Ghonim would be freed Monday afternoon.

Sawiris is member of a self-appointed group of opposition leaders in Egypt who have met with the government to negotiate political reforms and the release of prisoners has been a key demand of opposition representatives.

On Friday, Egypt's 6th of April opposition movement announced that it had elected Ghonim as its spokesman, stating that if the government wanted to talk to the protest group, it should talk to Ghonim. That move was made in an effort to force the Egyptian government to release him, the group said, according to reports.

Before the demonstrations began in his home country, Ghonim had written about his plans to take part in Egypt's anti-government protests, stating that he would do so despite his family wanting him to remain out of the action.

The protests have called for the resignation of Egyptian President Hosni Mubarak, who has held office for three decades, as well as changes to the nation's constitution and other political reforms.

On Jan. 27, the day Ghonim was first reported missing, he wrote on his Twitter account:

Pray for #Egypt. Very worried as it seems that government is planning a war crime tomorrow against people. We are all ready to die #Jan25

[Updated 9:25 a.m.: Video of Al Jazeera English report, as posted on YouTube, on Ghonim's release added.]

[Updated 11:03 a.m.: A Google spokesman said the company has confirmed Ghonim's release, saying "It is a huge relief that Wael Ghonim has been released. We send our best wishes to him and his family."

Google also tweeted from its official company account, @Google, "Huge relief--Wael Ghonim has been released. Our love to him and his family."]

RELATED:

Wael Ghonim, Google's still-missing exec in Egypt, named spokesman for opposition group

Friend of Wael Ghonim, missing Google exec, calls for volunteers in Cairo to search for him

-- Nathan Olivarez-Giles

Twitter.com/nateog

Video: Al Jazeera English reports Wael Ghonim's release. Credit: Al Jazeera English on YouTube

Photo: Wael Ghonim's Facebook profile photo. Credit: Facebook

Image: A screenshot of Google's tweet confirming Ghonim's release. Credit: Twitter

AOL chief executive Tim Armstrong said Monday that the acquisition of the Huffington Post for $315 million was "a big score for AOL" and that the deal would help the company on its path to reestablishing a weakened brand.

Left with a shaky foundation after it split from Time Warner in late 2009, AOL is trying to survive the inexorable decline of its once-massive dial-up business, which still accounts for the vast majority of its profits even though most of those paying subscribers don't even connect via telephone anymore. Hoping to revitalize the company by making it into a major online news and media destination, Armstrong has given AOL a new homepage, and bought up a series of news websites and other online businesses, with Huffington Post as the largest so far.

"We believe this transaction will add significant acceleration to our company, to our strategy and to our shareholder returns," Armstrong, joined by Huffington, said in a conference call with investors. "The Huffington Post is one of the best properties on the Internet."

Armstrong said he wants AOL, with Huffington's guidance, to focus on local news and women's content, both of which he sees as relatively untapped markets online. The company said it expected the deal to help it reach its goal of growth in operating income growth by 2013. (Technically, OIBDA growth -- or operating income before depreciation and amortization).

But investors and analysts have been skeptical about AOL's chances of pulling off a turnaround. That doubt seemed to show as AOL's stock price was down slightly in early trading Monday. The stock has slid nearly 14% in the last three months.

The Huffington Post is being sold to AOL Inc. for $315 million.

As part of the deal, which Huffington Post co-founder Arianna Huffington announced on her blog and AOL announced in a news release, Huffington is to become president and editor in chief of a new Huffington Post Media Group division at AOL.

The purchase of the popular news and opinion website will increase AOL's news portfolio as it competes against Yahoo's growing online news publication profile and Google's news efforts as well as traditional media companies online.

Huffington will gain control of additional AOL news websites dealing with news, technology, women, entertainment and video content.

The combination of AOL's media efforts and the Huffington Post will reach about 117 million viewers in the U.S. and 270 million globally, AOL said.

In a statement, AOL said it is using about $300 million in on-hand cash in the purchase.

The deal still has to meet government approvals, but the boards of directors of each company and shareholders of the Huffington Post have approved the transaction, AOL said.

The transaction is expected to close by the end of the first quarter or the early part of the second quarter this year, AOL said.

"The Huffington Post has already been growing at a prodigious rate," Huffington said. "But my New Year's resolution for 2011 was to take HuffPost to the next level -- not just incrementally, but exponentially. With the help of our CEO, Eric Hippeau, and our president and head of sales, Greg Coleman, we'd been able to make the site profitable. Now was the time to take leaps."

Huffington said her staff set goals early this year to expand into more local news coverage for the Huffington Post, the launch of international sections for the website -- with a "HuffPost Brazil" section coming first -- and more original video content.

She also noted that a goal was to add more coverage of automobiles, music, games and minority communities. It was around the same time that the Huffington Post was setting these goals that AOL Chairman and Chief Executive Tim Armstrong got in touch with the online publication.

AOL, with its network of blogs on autos, music, sports and news, as well as its local news start-up effort Patch.com and video-production resources, had all the tools needed to help the Huffington Post meet its goals, Huffington said.

Things moved quickly over the last few weeks, and a deal was signed Sunday at the Super Bowl, she said.

"By combining HuffPost with AOL's network of sites, thriving video initiative, local focus, and international reach, we know we'll be creating a company that can have an enormous impact, reaching a global audience on every imaginable platform," she said.

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-- Nathan Olivarez-Giles

twitter.com/nateog

Photo: Arianna Huffington. Credit: Liz O. Baylen / Los Angeles Times

Whatever it is they say about third times clearly doesn’t apply to the Comic Con online ticketing system, which has once again crashed as hordes of fans attempt to buy passes to the annual San Diego nerd extravaganza.

[Updated, 10:30 a.m....A few lucky buyers are now tweeting that they have managed to snag tickets to Comic Con, many after steadily refreshing the TicketLeap page for more than an hour.]

Twice before, technical glitches forced organizers of the July 21-24 event to cancel registration within hours of opening it. This time they hooked up with sales website TicketLeap in hopes that it would better funnel the streams of hopefuls to the original partner EPIC Registration, a set-up that many worried would be too convoluted.

Minutes before the 9 a.m. Saturday start, the site was telling users that it was “currently over capacity” and to try again momentarily. Some buyers saw a page saying “We’ll be right back. TicketLeap is currently down for maintenance.”

Since then, so many frustrated buyers have hit Twitter in protest that #SDCC (for San Diego Comic Con) was one of the top-trending topics worldwide. One user named Snubs wrote: “A con like Comic-Con should be prepared for this kind of registration. TicketLeap is so full of fail. Preparation is needed! #SDCCFail”

There’s no wrath like fanboys and fangirls scorned. “The greatest trick the Devil ever pulled was convincing the world that Comic Con tickets are really there,” huffed Twitter user redsonja1313.

“I mean, is it wrong of me to *assume* Comic Con #SDCC would have a freaking IT Geek under their belt?” wrote TrekJen.

Maybe it’s Robert Pattinson’s fault.

One tweet, from shaylrose, blamed “freaking Twilight girls invading” the convention for overloading the site. Others said they would even be willing to pay high Ticketmaster fees to avoid another ticketing snafu.

TicketLeap quickly responded, in a tweet, “@Comic_Con fans, if you see an over capacity message hit refresh. We are under heavy load right now and it should smooth out. #sdcc.”

La Familia drug cartel is selling not just drugs, but also counterfeit Microsoft Office computer software, according the Redmond, Wash., tech giant.

Microsoft showed off unauthorized copies of its Office 2007 software in Paris today which the company said it found for sale in Mexico. The pirated copies of Office were marked with La Familia cartel's rectangular "FMM" logo that the Microsoft says proves the link between the counterfeiting and the organized crime group, according to a Bloomberg report. 

"This is the real side, the scary side of counterfeiting and it plagues the world," said David Finn, Microsoft's associate general counsel for anti-piracy, according to Bloomberg.

Finn displayed the bootleg Microsoft software Friday at the Global Congress on Combating Counterfeiting and Piracy, the report said.

The International Chamber of Commerce said at the Paris event that, in the 20 nations that make up the G-20, the value of counterfeit and pirated goods was an estimated $650 million in 2008, according to Bloomberg.

That number is expected to rise to about $1.77 trillion by 2015, the report said.

Finn, Microsoft's attorney, wrote in a company blog post that, according to an analysis by Mexico's attorney general, drug cartels in Mexico have a "sophisticated distribution network of 180,000 points of sale in stores, markets and kiosks, earning more than $2.2 million dollars in revenue every day."

John Newton of the International Criminal Police Organization (Interpol) said organized crime groups were attracted to counterfeit goods because they are "low-risk, high-profit crimes," Bloomberg said.

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-- Nathan Olivarez-Giles

twitter.com/nateog

Kenneth Cole sent out a controversial tweet that used the unrest in Egypt to promote his spring fashion line.

The message, sent out by Cole personally, has sparked a wave of criticism and controversy that hasn't let up much despite the fashion designer apologizing and taking down the offending tweet.

Cole's tweet, sent via the line's @KennethCole account, stated:

Millions are in an uproar in #Cairo. Rumor is they heard our new spring collection is now available online at http://bit.ly/KCairo -KC 

A few hours after the tweet was posted Thursday, Cole himself issued this statement on his label's Facebook page:

I apologize to everyone who was offended by my insensitive tweet about the situation in Egypt. I’ve dedicated my life to raising awareness about serious social issues, and in hindsight my attempt at humor regarding a nation liberating themselves against oppression was poorly timed and absolutely inappropriate.

Kenneth Cole, Chairman and Chief Creative Officer

The tweet also has boosted the number of people following the @KennethCole account by about 3,000 within just a few hours, according to a report from the Associated Press. The link in the message directed people to the online store for the lines Kenneth Cole New York and Kenneth Cole Reaction.

On Friday afternoon, after many comments on Facebook and Twitter both in support of and condemning Cole, the designer wrote another statement on his line's Facebook page saying:

I have spent a considerable amount of time reading your comments, and value your insights and feedback. I want to reiterate that my use of levity with regard to this momentous event was extremely inappropriate. My thoughts are with the courageous people of Egypt. -KC

And in what is becoming typical Twitter fashion, an account mocking Kenneth Cole was set up, spoofing Cole and writing a full stream of offensive tweets.

On Friday afternoon, a tweet from @FakeKennethCole said:

We stand with the people of Egypt. President Mubarak -- step down NOW, and I'll give you 15% off any non-sale item in our stores.* -FKC

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-- Nathan Olivarez-Giles

twitter.com/nateog

Photo: A screen shot of the controversial tweet sent Thursday by Kenneth Cole. Credit: Associated Press

The months of Verizon iPhone hype have, so far, turned into record sales.

"At 8:10 p.m. EST [Thursday], Verizon Wireless ceased online orders of iPhone 4 to existing customers and ended the most successful first-day sales in the history of the company," said‬ Dan Mead, Verizon's president and CEO in a statement.

"In just our first two hours, we had already sold more phones than any first-day launch in our history."

Mead and other Verizon officials declined to give specific sales numbers for its version of the iPhone 4 so far. A company spokesman said Verizon had no other comment on the iPhone sales than Mead's statement.

Those who missed out on the pre-orders for the Verizon version of the Apple iPhone 4 will simply have to wait for the handsets to arrive on the shelves of Verizon stores, Apple stores, Best Buy locations and a few Wal-Marts, too, next Thursday.

Verizon is planning to open its company stores -- more than 2,000 in the U.S. -- at 7 a.m. Thursday.

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Photo: An iPhone sign hangs in the window of a Verizon store Thursday in Orem, Utah. Credit: George Frey / Getty Images

It wasn't all that long ago that explaining what the Internet is was a pretty tough thing to do.

A bit of confusion is caused amongst Bryant Gumbel and Katie Couric as they try to describe the Internet and the @ sign as seen in the video above, which was posted on YouTube last week and is reportedly from a January 1994 episode of NBC's "Today" show.

Gumble, in the video, says of the @ sign: "I wasn't prepared to translate that as I was doing that little tease. That little mark with the 'a' and the ring around it."

Later in the video, he asks: "What is Internet, anyway?"

Couric answers: "Internet is uh, that massive computer network. The one that's becoming really big now."

Gumble: "What do you mean that's big? What -- how does one -- what do you write to it, like mail?"

Couric: "No, a lot of people use it and communicate. I guess they can communicate with NBC writers and producers."

The whole scenario might seem funny nowadays, but Los Angeles-based YouTube user VortexTech, who posted the video, said he didn't do so just for laughs.

"Don't laugh at Bryant Gumbel and Katie Couric. It's easy to forget how relatively recent a phenomenon the Internet is for most persons who use it today," VortexTech wrote in the description of the video.

LA Observed embedded the video on its site this morning, along with speculation that it may have first been posted by an NBC employee who was fired once the video made its way online.

NBC officials weren't available for comment Friday morning to confirm or deny the rumors mentioned in LA Observed's report.

[Updated 11:34 a.m.: According to the Washington Post, Vanity Fair writer Mike Ryan was possibly the first to tweet a link to the Today Show video last week, and shortly thereafter the NBC employee who first uploaded the video lost his job.]

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-- Nathan Olivarez-Giles

twitter.com/nateog

Video: "Today" show clip from 1994. Credit: VortexTech via YouTube

Google has been flooded with more than 75,000 job applications over the last week, setting a company record.

The wave of worldwide applicants comes after Google said last week that it is extending a hiring spree that it began last year. The push for new hires at the leading Web-search company is its largest so far and Google said it plans to grow to more than 30,000 employees by the beginning of 2012.

The more than 75,000 applicants beat Google's previous record for applications, set in May 2007, by about 15%, said company spokesman Jordan Newman.

"2011 is going to be our biggest hiring year ever," Newman said.

The Mountain View, Calif., firm is looking to bolster staff in its mobile, advertising and cloud computing areas, said Alan Eustace, senior vice president of engineering and research, in a blog post last week.

Eustace noted that Google's Android mobile operating system runs on more than 100 devices and added that more than 300,000 Android devices are activated daily.

Chrome, Google's Web browser, has about 120 million active users and last year more than 1 million businesses started using Google Apps, he said.

In 2010, Google hired more than 4,500 new workers, mostly in engineering and sales, the largest hiring spree for Google. Google had about 24,400 employees at the end of 2010, according to a Bloomberg report.

[Updated 10:48 a.m.: Added confirmation from Google spokesman Jordan Newman.]

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Wael Ghonim, Google's still-missing exec in Egypt, named spokesman for opposition group

-- Nathan Olivarez-Giles

twitter.com/nateog

Photo: A bicyclist rides by a sign at the Google headquarters in Mountain View, Calif. Credit: Justin Sullivan/Getty Images

Wael Ghonim, the Google executive still missing in Egypt, has been appointed spokesman of the country's 6th of April opposition movement, according to CBS News.

Ghonim has been reported missing since Jan. 25, after the first day of protests in Egypt against  President Hosni Mubarak, who has held office for three decades.

There is widespread speculation that Ghonim, who is Google's head of marketing in the Middle East and North Africa, is being held by Mubarak's government, though the government hasn't confirmed holding him.

On Thursday, a leader of the 6th of April opposition group told CBS reporter Khaled Wassef that the protesters in Cairo's Tahrir Square had elected Ghonim the group's spokesman. Tahir Square has been the scene of violent protests recently, with pro-Mubarak supporters having attacked thousands of anti-government demonstrators.

According to CBS, the 6th of April group told Wassef that if the government leaders want to talk to the group they need to talk to Ghonim.

The move from the 6th of April was made in an attempt to force Mubarak's government to release Ghonim, CBS said.

The protests have not stopped since they kicked off Jan. 25, and demonstrators have said they won't let up until Mubarak leaves the government and are even demanding he step down by Friday.

Google has released no new information on Ghonim, but did put out a call for help in finding him on Tuesday. Ghonim's friends too are looking to the public to assist in locating him and have launched a search effort in Cairo.

Katelin Todhunter-Gerberg, a Google spokeswoman, said the company had no new information on Ghonim's whereabouts and was declining to comment on things it couldn't confirm. 

Todhunter-Gerberg did, however, ask that people with any information call +44 20 7031 3008 or e-mail infoaboutwael@google.com.

CBS also reported that the Al Jazeera news agency has been told by Ghonim's family that they have received threatening phone calls and have been told that Ghonim is being "taught a lesson."

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Friend of Wael Ghonim, missing Google exec, calls for volunteers in Cairo to search for him

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-- Nathan Olivarez-Giles

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Photos: Two images of Wael Ghonim taken from his Facebook page. Credit: Facebook

An Apple shareholder proposal to force the tech giant to publicly release a succession plan for Chief Executive Steve Jobs has been backed by Institutional Shareholder Services, a company considered to be one of the most highly influential of investor advisors.

The proposal was submitted by the Central Laborers Pension Fund in August, before Jobs announced his indefinite medical leave last month. Jobs handed most of his daily responsibilities over to Apple's Chief Operating Officer Tim Cook but retained his CEO title.

The Central Laborers Pension Fund fund owns about 11,500 shares in Apple, or about a thousandth of 1% of the Cupertino company's outstanding shares, according to the Associated Press.

ISS, a company that consults institutional investors on how to vote on such shareholder measures, also called for Apple's board to release such a plan to shareholders annually.

In a statement on the Central Laborers proposal, the ISS said, "All companies should have succession planning policies and succession plans in place, and boards should periodically review and update them."

The measure will go up for an Apple shareholder vote at the company's annual meeting on Feb. 23.

In its 2011 Investor Proxy Statement, released on Jan. 7, Apple asked shareholders to vote against the measure.

"Not just the CEO, is critical to Apple's success," Apple's board of directors said in the proxy statement. "Accordingly, the Board already implements many of the proposed actions and maintains a comprehensive succession plan throughout the organization."

In the proxy statement, Apple said it commits an annual review of succession planning for its senior management, including its chief executive.

"As part of this annual review, the Board has a formal evaluation process in which it identifies and recommends development of internal candidates for succession based on criteria that reflect Apple’s business strategy," Apple's proxy statement said.

Such a move would "undermine the Company's efforts to recruit and retain executives" and "invites competitors to recruit high-value executives away from Apple. Furthermore, executives who are not identified as potential successors may choose to voluntarily leave the Company," Apple said.

Aside from ISS, the Central Laborers proposition is also supported by the Laborers International Union of North America.

In a statement, Laborers International said: "We're concerned to hear the news about Steve Jobs' health and hope to see him return to full duties soon. However, this news demonstrates the need for Apple to do well by its shareholders, including our members' pension funds."

The group said it has successfully proposed similar CEO succession proposals to companies such as Hewlett-Packard, Verizon and American Express.

Laborers International also said Apple had misconstrued its proposal.

"We do not expect them to provide specific names of future executives, but merely demonstrate they have a plan in place for naming one," the group said. "This proposal would not only benefit our members' retirement savings, but also would give reassurance to other Apple shareholders and help the company."

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-- Nathan Olivarez-Giles

twitter.com/nateog

Photo: A file photo from August 2007 shows Apple CEO Steve Jobs and Apple Chief Operating Officer Tim Cook during a question-and-answer session at Apple headquarters in Cupertino, Calif. Credit: Monica M. Davey / EPA