Nation roundup for February 5

Changes sought for species act

BILLINGS, Mont. (AP) — Republicans in Congress on Tuesday called for an overhaul to the Endangered Species Act to curtail environmentalists’ lawsuits and give more power to states, but experts say broad changes to one of the nation’s cornerstone environmental laws are unlikely given the pervasive partisan divide in Washington, D.C.

A group of 13 GOP lawmakers representing states across the U.S. released a report proposing “targeted reforms” for the 40-year-old federal law, which protects imperiled plants and animals.

Proponents credit the law with staving off extinction for hundreds of species — from the bald eagle and American alligator to the gray whale. But critics contend the law has been abused by environmental groups seeking to restrict development in the name of species protection.

Led by Rep. Cynthia Lummis of Wyoming and Rep. Doc Hastings of Washington state, who chairs the House Natural Resources Committee, the Republicans want to amend the law to limit litigation from wildlife advocates that has resulted in protections for some species. And they want to give states more authority over imperiled species that fall within their borders.

Also among the recommendations are increased scientific transparency, more accurate economic impact studies and safeguards for private landowners.

Alleged cheating on nuclear exams

WASHINGTON (AP) — The Navy is investigating 30 or more senior sailors in connection with alleged cheating on written tests designed to qualify them as instructors at a school that trains younger sailors to operate naval nuclear power reactors, officials said Tuesday.

The reactors at Charleston, S.C., are of the kind used in propulsion systems for Navy submarines and aircraft carriers.

The alleged misbehavior is unrelated to Navy nuclear weapons carried aboard Trident submarines, according to Adm. John Richardson, the director of the Navy’s nuclear propulsion program.

He said it came to light on Monday when a senior enlisted sailor at the Charleston training site reported the cheating to higher authorities. Richardson said the unidentified sailor “recognized that this was wrong” and chose to report it.

Pressed to say how many sailors were implicated in the investigation by the Naval Criminal Investigative Service, Richardson said a “ballpark figure” was something in the neighborhood of 12 to 20.

Reports released on NSA requests

WASHINGTON (AP) — A flurry of new reports from major technology companies show that the government collects customer information on tens of thousands of Americans every six months as part of secret national security investigations.

And the companies’ top lawyers struck a combative stance, saying the Obama administrative needs to provide more transparency about its data collection.

Freed by a recent legal deal with the Obama administration, Google, Microsoft, Yahoo, Facebook, LinkedIn and Tumblr provided expanded details and some vented criticism about the government’s handling of customers’ Internet data in counterterrorism and other intelligence-related probes.

The figures from 2012 and 2013 showed that companies such as Google and Microsoft were compelled by the government to provide information on as many as 10,000 customer accounts in a six-month period.

Yahoo complied with government requests for information on more than 40,000 accounts in the same period.

The companies earlier had provided limited information about government requests for data.

$750M pledged to get kids online

ADELPHI, Md. (AP) — Claiming progress in his goal to put the world at the fingertips of every American student, President Barack Obama on Tuesday announced $750 million in commitments from U.S. companies to begin wiring more classrooms with high-speed Internet.

Apple is pledging $100 million in iPads, computers and other tools. AT&T and Sprint are contributing free Internet service through their wireless networks. Verizon is pitching in up to $100 million in cash and in-kind contributions.

And Microsoft is making its Windows software available at discounted prices and offering 12 million free copies of Microsoft Office software.

“In a country where we expect free Wi-Fi with our coffee, we should definitely demand it in our schools,” Obama said at a middle school in the Washington suburb of Adelphi, Md.

Students there are assigned iPads that they use in class and at home.

Beyond the promise of millions in donated hardware and software, the Federal Communications Commission also is setting aside $2 billion from service fees to connect 15,000 schools and 20 million students to high-speed Internet over two years.

Obama last year announced his goal of bringing high-speed Internet to 99 percent of students within five years. He used Tuesday’s announcement as another example of how to act without waiting on Congress.

“We picked up the phone and we started asking some outstanding business leaders to help bring our schools and libraries into the 21st century,” the president said.

The average school has the same Internet speed as an average home, but serves 200 times as many people, Obama said. About 30 percent of students have true high-speed Internet in their classrooms, compared with 100 percent of South Korean students, he said.

He said the pledges would put the world and outer space at every child’s fingertips

Before the speech, Obama visited a seventh-grade classroom and noted one benefit of their Internet access: lighter knapsacks because they don’t carry as many books to and from school.

“Sasha’s book bag gets too big sometimes, hurts her back,” he said of his younger daughter.

Cecilia Munoz, director of domestic policy for Obama, spoke of the importance of providing high-quality education for all students.

“Technology is clearly going to be essential to making that possible,” she said.

The initiative builds on Obama’s focus for 2014 on helping more people join and stay in the middle class amid an economic recovery in which the benefits have come more quickly for those at the top of the income scale than for those toward the bottom.

Gene Sperling, a top White House economist, said every student needs high-speed Internet, but the problem is more pronounced in disadvantaged schools where students are less likely to have Internet connections at home. He said digital learning tools make it easier for schools to cater to the needs of students who need extra help or who are ahead of the curve.

He estimated that millions of students would benefit from Tuesday’s announced help.

For Obama, the commitments from the technology companies may help bolster his argument that despite opposition to much of his agenda from Congress, he can still be effective in his final years in office.

Obama has held similar events in recent days to announce commitments by entities outside of government to address long-term unemployment and expand access to higher education for low-income students.

“This for us really isn’t about what Congress will or won’t do,” Rose Kirk, president of the Verizon Foundation, said in an interview. “It’s really about the kids. I believe it makes perfect sense that we use our technology, our resources, our insight to have an impact.”

Microsoft names cloud computing chief as next CEO

LOS ANGELES (AP) — Microsoft has named the head of its cloud computing business as the company’s next CEO, tapping a longtime insider to lead efforts to catch rivals in mobile devices and offer more software and services over the Internet.

Satya Nadella replaces Steve Ballmer immediately to become only the third chief executive in Microsoft’s 38-year history. Company founder and first CEO Bill Gates is leaving his role as chairman to serve as an adviser. He will spend a third of his time working on future products and technology.

Nadella, 46, most recently headed the company’s small but growing cloud computing unit, in which customers buy software and services housed on distant servers connected to the Internet. It’s a departure from Microsoft’s roots making software installed directly on personal computers.

In addition to growing that business, one of Nadella’s first tasks as CEO will be the completion of Microsoft Inc.’s $7.3 billion purchase of Nokia’s phone business and patent rights — part of a plan to boost Windows Phone software in a market dominated by iPhones and Android devices.

The direction points the company toward an orbit occupied by rivals Google Inc., Apple Inc. and Amazon.com Inc. and away from the core PC business that has been Microsoft’s mainstay.

“Going forward, it’s a mobile-first, cloud-first world,” Nadella said in a video accompanying the announcement Tuesday.

Nadella, who has worked at Microsoft for 22 years, vowed to remove any obstacles that prevent the company from innovating and said he would capitalize on Microsoft’s experience in making the industry’s leading productivity software package, Office.

“We need to be able to pick the unique contribution that we want to make,” he said. “That’s where our heritage of having been the productivity company … is what we want to get focused on.”

Gates, meanwhile, will remain on the company’s board. The new Microsoft chairman will be board member John Thompson, who led the search for a new CEO after Ballmer said in August that he planned to step down.

Thompson said Nadella was the board’s “first and unanimous choice.” Other candidates considered included Ford CEO Alan Mulally and other insiders such as Chief Operating Officer Kevin Turner and former Skype head Tony Bates.

Nadella has “the right background to lead the company in this era,” Gates said in a video message. “There’s a challenge in mobile computing. There’s an opportunity in the cloud. The various business groups he’s worked in, he’s driven innovation, gotten architectures put together that really meet the needs of our customers. The opportunity for Microsoft is greater than ever before.”

Nadella has been an executive in some of the company’s fastest-growing and most-profitable businesses, including its Office and server and tools business. In four years as division president, he helped grow that business into one with $20 billion in annual revenue — about a quarter of Microsoft’s total revenue in the most recent fiscal year.

For the past seven months, he was the executive vice president who led Microsoft’s cloud computing offerings. Nadella’s new cloud enterprise group has also been growing strongly, more than doubling customers in the latest quarter — although it remains a small part of Microsoft’s current business.

Analysts hope that Nadella can maintain the company’s momentum in cloud computing services and business software while minimizing the negative effect of Microsoft’s unprofitable forays into consumer hardware. It’s a transition IBM Corp. succeeded in making in the 1990s, but that companies such as Hewlett Packard Co. and Dell Inc. have struggled with.

Microsoft shares rose 13 cents to $36.61 in midday trading Tuesday.

Nadella’s appointment comes at a time of turmoil for Microsoft.

Founded in 1975 by Gates and Paul Allen, the company has always made software that powered computers made by others — first with its MS-DOS system, then with Windows and its Office productivity suite starting in the late 1980s. Microsoft’s coffers swelled as more individuals and businesses bought personal computers.

But Microsoft has been late adapting to changes in the technology industry as PC sales declined. It allowed Google to dominate in online search and advertising, and it watched as iPhones, iPads and Android devices grew. Microsoft’s attempts to manufacture its own devices have been marred by problems, from its quickly aborted Kin line of phones to its still-unprofitable line of Surface tablets.

Analysts see hope in some of the businesses Nadella had a key role in creating.

Microsoft’s cloud computing offering, Azure, and its push to have consumers buy Office software as a $100-a-year Office 365 subscription are seen as the biggest drivers of Microsoft’s growth in the next couple of years. Both businesses saw the number of customers more than double in the last three months of the year, compared with a year earlier.

Nadella “was really one of the people who helped build up the commercial muscle,” said Kirk Materne, an analyst with Evercore Partners. “He has a great understanding of what’s going on in the cloud and the importance of delivering more technology as a service.”

Michael Turits, an analyst with Raymond James, said that Nadella will likely view the Nokia acquisition and the Surface tablet as pawns to help drive Microsoft’s cloud computing business.

“Whatever strategic decisions are made, we like the idea that someone like Satya would most likely make them with an eye to preserving and optimizing the value of those enterprise businesses,” Turits said.

Nadella is a technologist, fulfilling the requirement that Gates set out at the company’s November shareholder meeting, where the Microsoft chairman said the company’s new leader must have “a lot of comfort in leading a highly technical organization.”

Born in Hyderabad, India, in 1967, Nadella received a bachelor’s degree in electrical engineering from Mangalore University, a master’s degree in computer science from the University of Wisconsin, Milwaukee, and a master’s of business administration from the University of Chicago.

He joined Microsoft in 1992 after being a member of the technology staff at Sun Microsystems.

Partly because of Nadella’s insider status and the fact that both Gates and Ballmer will remain among Microsoft’s largest shareholders and, for now, company directors, analysts are not expecting a quick pivot in the strategy of making tablets and mobile devices.

Some hope, however, that he will make big changes that will help lift Microsoft stock, which has been stuck in the doldrums for more than a decade. Since Ballmer took office on Jan. 13, 2000, Microsoft shares are down a split-adjusted 32 percent, compared with a 20 percent gain in the S&P 500.

“We do not want to see a continuation of the existing direction for the business,” Nomura analyst Rick Sherlund wrote in a note Friday. “So it will be important that Mr. Nadella be free to make changes.”