Top 10: Microsoft grows hostile, Yahoo says nyah nyah

We’ve been waiting all week for the other shoe on Microsoft’s hostile takeover attempt to drop on Yahoo, which isn’t waiting for that to happen and has forged an advertising agreement with Google as a way to hedge against the ongoing acquisition dispute. In other news — and, yes, there was some other news — Apple updated iMac with a speedier processor and more graphics choices, while Adobe announced a community development project that should lead to a consistent application interface across all devices that use Flash and Adobe Integrated Runtime. Of course, there was also security news, too.

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1. Report: Microsoft close to hostile bid for Yahoo: This one could change after U.S. financial markets close Friday afternoon, but word is that Microsoft is getting ready to make a hostile takeover attempt on Yahoo, according to The Wall Street Journal. That was reported early Friday. By late afternoon, the Journal was reporting that talks between Microsoft and Yahoo had intensified in a “last-ditch” effort to arrive at an amicable deal. But the report also quoted sources familiar with what’s going on saying that a deal isn’t imminent. Microsoft CEO Steve Ballmer is said to have told employees that he’ll “go to what I think it’s worth if that gets a deal done.” But he also told the Journal that “with the right circumstances, it’ll happen. Without the right circumstances, it won’t happen.” OK, then. That clears everything up….

[Keep up with all the twists and turns of the Microsoft-Yahoo saga with our special report ]

2. Report: Yahoo could run Google ads next week: Not to be undone (just yet) by word that Microsoft is going to ratchet up its acquisition fight, Yahoo is said to be in an agreement that will have it running Google ads within a week. The deal would improve Yahoo’s cash flow, possibly bringing in up to $1 billion yearly because of a revenue-sharing aspect of the deal, according to a Citigroup analyst.

3. Adobe establishes Open Screen Project for Flash, AIR: Adobe launched the Open Screen Project that is meant to bring together digital content and service providers, device makers and developers so that a consistent application interface will be created for all devices using Flash and Adobe Integrated Runtime. “If you look at the current experience, content doesn’t work reliably, you can’t easily install applications, you can’t get applications on a device,” said Abobe CTO Kevin Lynch. The project aims to fix that.

4. XP change corrupts data; hamstrings SP3 rollout and Microsoft backpedals on Windows updates: Microsoft put off releasing the Windows XP Service Pack 3 because operating system changes can lead to data corruption in Microsoft’s point-of-sale and store management software. Automatic distribution of Vista SP1 was also halted. Users can get SP1 manually from Windows Update, and while there is not such an option for XP SP3, some savvy users have found a stand-alone installer on Microsoft servers. Microsoft wouldn’t confirm (or deny for that matter) that the links provided on the Internet by those users will take you to company-approved files.

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5. IBM to build apps marketplace: IBM is planning to launch the Global Applications Marketplace later this year, giving small and midsized businesses a one-stop shop to check out and buy apps from independent software vendors worldwide. Local IBM channel partners will install and manage the applications under the marketplace, which IBM likens to (what else?!) Amazon.com. Companies that have small IT staffs or none at all are expected to particularly benefit from the marketplace.

6. 7 dirty secrets of the security industry: Now, this is why we go to trade shows. Joshua Corman, principal security strategist for IBM/ISS, held forth at Interop this week in Las Vegas with the “seven dirty secrets of the security industry,” saying in a discussion that “it’s best to have a healthy level of skepticism about what security vendors are trying to tell you.” IBM/ISS is, by the way, a security vendor, so he presumably knows the inside scoop. For instance, vendors insist that the network perimeter must be protected, but half of all breaches occur because of lost laptops, thumb drives, or other removable data, and most data that is lost doesn’t have anything to do with the firewall working or not working. “If you still believe in perimeters, you may as well believe in Santa Claus,” he said. Even though we know Corman is now on Santa’s Naughty List, the point is well taken.

7. Travel group warns: Corporate data at risk from laptop searches at border: In what is turning into an ongoing story, the latest concern regarding the recent federal court ruling that U.S. Customs and Border Protection officials don’t need reasonable cause or suspicion to seize or search laptops comes from a travel group warning that corporate data could be at risk. The Association of Corporate Travel Executives is telling its members to limit how much proprietary business data they have on laptops and other electronic devices. Some concerned privacy and travel organizations are urging Congress to get involved, at least to push the Department of Homeland Security to disclose its practices related to such searches, which can include border officials downloading personal data from seized electronics devices.

8. BEA employees hold ‘wake’ for company: Oracle closed the $8.5 billion deal to acquire BEA Systems, prompting BEA employees, who would prefer to remain anonymous, to gather for a “wake” complete with a makeshift casket in one corner. Some of the employees might wind up laid off as the merger takes hold, but even so the gathering was generally cheerful, with various attendees saying that it made sense for Oracle to buy BEA. No hard feelings. “I’m excited about the prospect of the combined entity moving forward,” one of them said. Besides which, BEA did right by its workers during the process of the deal being finalized — “I think BEA did the best it could in putting together plans to take care of employees,” said one. “To the best of my knowledge, I won’t be offered a position. I’m not on the list,” said another. “I don’t bear Oracle any malice. I am sad that the passing of BEA because it was just really a great place to work.”

9. Microsoft faces challenges in expanding management strategy: In a major move away from a strategy announced five years ago, Microsoft now says it wants to be a dominant enterprise management player, setting forth its plan to achieve that at the annual Microsoft Management Summit. The company is aiming for a cross-platform enterprise datacenter management infrastructure that allows for Linux and Unix. If successful, the move would pit Microsoft against IBM, CA, Hewlett-Packard and BMC in that space. The approach makes sense, according to some users and analysts, but some cautioned that Microsoft needs to define its goals, improve its platform and show that it really can accommodate non-Windows systems.

10. Apple updates iMac with faster processor, graphics options: Apple updated iMac, its desktop computer, with faster Intel Core 2 Duo processors and an improved graphics option. New iMacs come in three models that are all available now.