Protesters surge around Egypt’s presidential palace












CAIRO (Reuters) – Tens of thousands of Egyptian protesters surged around the presidential palace on Friday and the opposition rejected President Mohamed Mursi‘s call for dialogue to end a crisis that has polarized the nation and sparked deadly clashes.


The Islamist leader’s deputy said he could delay a December 15 referendum on a constitution that liberals opposed, although the concession only partly meets a list of opposition demands that include scrapping a decree that expanded Mursi‘s powers.












“The people want the downfall of the regime” and “Leave, leave,” crowds chanted after bursting through barbed wire barricades and climbing on tanks guarding the palace of Egypt‘s first freely elected president.


Their slogans echoed those used in a popular revolt that toppled Mursi’s predecessor Hosni Mubarak in February 2011.


Vice President Mahmoud Mekky said in a statement sent to local media that the president was prepared to postpone the referendum if that could be done without legal challenge.


The dialogue meeting was expected to go ahead on Saturday in the absence of most opposition factions. “Tomorrow everything will be on the table,” a presidential source said of the talks.


The opposition has demanded that Mursi rescind a November 22 decree giving himself wide powers and delay the vote set for December 15 on a constitution drafted by an Islamist-led assembly which they say fails to meet the aspirations of all Egyptians.


The state news agency reported that the election committee had postponed the start of voting for Egyptians abroad until Wednesday, instead of Saturday as planned. It did not say whether this would affect the timing of voting in Egypt.


Ahmed Said, leader of the liberal Free Egyptians Party, told Reuters that delaying expatriate voting was made to seem like a concession but would not change the opposition’s stance.


He said the core opposition demand was to freeze Mursi’s decree and “to reconsider the formation and structure of the constituent assembly”, not simply to postpone the referendum.


The opposition organized marches converging on the palace which elite Republican Guard units had ringed with tanks and barbed wire on Thursday after violence between supporters and opponents of Mursi killed seven people and wounded 350.


Islamists, who had obeyed a military order for demonstrators to leave the palace environs, held funerals on Friday at Cairo’s al-Azhar mosque for six Mursi partisans who were among the dead. “With our blood and souls, we sacrifice to Islam,” they chanted.


“ARM-TWISTING”


In a speech late on Thursday, Mursi had refused to retract his November 22 decree or cancel the referendum on the constitution, but offered talks on the way forward after the referendum.


The National Salvation Front, the main opposition coalition, said it would not join the dialogue. The Front’s coordinator, Mohamed ElBaradei, a Nobel peace laureate, dismissed the offer as “arm-twisting and imposition of a fait accompli”.


Murad Ali, spokesman of the Brotherhood’s Freedom and Justice Party (FJP), said opposition reactions were sad: “What exit to this crisis do they have other than dialogue?” he asked.


Mursi’s decree giving himself extra powers sparked the worst political crisis since he took office in June and set off renewed unrest that is dimming Egypt’s hopes of stability and economic recovery after nearly two years of turmoil following the overthrow of Mubarak, a military-backed strongman.


The turmoil has exposed contrasting visions for Egypt, one held by Islamists, who were suppressed for decades by the army, and another by their rivals, who fear religious conservatives want to squeeze out other voices and restrict social freedoms.


Caught in the middle are many of Egypt’s 83 million people who are desperate for an end to political turbulence threatening their precarious livelihoods in an economy under severe strain.


“We are so tired, by God,” said Mohamed Ali, a laborer. “I did not vote for Mursi nor anyone else. I only care about bringing food to my family, but I haven’t had work for a week.”


ECONOMIC PAIN


A long political standoff will make it harder for Mursi’s government to tackle the crushing budget deficit and stave off a balance of payments crisis. Austerity measures, especially cuts in costly fuel subsidies, seem inevitable to meet the terms of a $ 4.8-billion IMF loan that Egypt hopes to clinch this month.


U.S. President Barack Obama told Mursi on Thursday of his “deep concern” about casualties in this week’s clashes and said “dialogue should occur without preconditions”.


The upheaval in the most populous Arab nation worries the United States, which has given billions of dollars in military and other aid since Egypt made peace with Israel in 1979.


The conflict between Islamists and opponents who each believe the other is twisting the democratic rules to thwart them has poisoned the political atmosphere in Egypt.


The Muslim Brotherhood’s spokesman, Mahmoud Ghozlan, told Reuters that if the opposition shunned the dialogue “it shows that their intention is to remove Mursi from the presidency and not to cancel the decree or the constitution as they claim”.


Ayman Mohamed, 29, a protester at the palace, said Mursi should scrap the draft constitution and heed popular demands.


“He is the president of the republic. He can’t just work for the Muslim Brotherhood,” Mohamed said of the eight-decade-old Islamist movement that propelled Mursi from obscurity to power.


(Additional reporting by Omar Fahmy; Writing by Edmund Blair and Alistair Lyon; Editing by Giles Elgood)


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Exclusive: Google to replace M&A chief












SAN FRANCISCO (Reuters) – Google Inc is replacing the head of its in-house mergers and acquisitions group, David Lawee, with one of its top lawyers, according to a person familiar with the matter.


Don Harrison, a high-ranking lawyer at Google, will replace Lawee as head of the Internet search company‘s corporate development group, which oversees mergers and acquisitions, said the source, who spoke anonymously because he was not authorized to speak publicly.












Google is also planning to create a new late-stage investment group that Lawee will oversee, the source said.


Google declined to comment. Lawee and Harrison could not immediately be reached for comment.


One of the Internet industry’s most prolific acquirers, Google has struck more than 160 deals to acquire companies and assets since 2010, according to regulatory filings. Many of Google’s most popular products, including its online maps and Android mobile software, were created by companies or are based on technology that Google acquired.


Harrison, Google’s deputy general counsel, will head up the M&A group at a time when the company is still in the process of integrating its largest acquisition, the $ 12.5 billion purchase of smartphone maker Motorola Mobility, which closed in May.


And he takes over at a time when the Internet search giant faces heightened regulatory scrutiny, with the U.S. Federal Trade Commission and the European Commission conducting antitrust investigations into Google’s business practices. Several recent Google acquisitions have undergone months of regulatory review before receiving approval.


As deputy general counsel, Harrison has been deeply involved in the company’s regulatory issues and many of its acquisitions. He joined Google more than five years ago and has completed more than 70 deals at the company, according to biographical information on the Google Ventures website.


Harrison is an adviser to Google Ventures, the company’s nearly four-year old venture division which provides funding for start-up companies.


While most of Google’s acquisitions are small and mid-sized deals that do not meet the threshold for disclosure of financial terms, Google has a massive war chest of $ 45.7 billion in cash and marketable securities to fund acquisitions.


Lawee, who took over the M&A group in 2008, has had hits and misses during his tenure. Google shut down social media company Slide one year after acquiring it for $ 179 million, for example.


The planned late-stage investment group has not been finalized, the source said. The fund might operate separately from Google Ventures, according to the source.


“Think of it as a private equity fund inside of Google,” the source said.


The company recently said it would increase the cash it allocates to Google Ventures to $ 300 million a year, up from $ 200 million, potentially helping it invest in later-stage financing rounds.


Google finished Friday’s regular trading session down 1 percent, or $ 6.92, at $ 684.21.


(Reporting By Alexei Oreskovic; editing by Carol Bishopric and Jim Loney)


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George Zimmerman sues NBC and reporters












ORLANDO, Fla. (AP) — George Zimmerman sued NBC on Thursday, claiming he was defamed when the network edited his 911 call to police after the shooting of Trayvon Martin to make it sound like he was racist.


The former neighborhood watch volunteer filed the lawsuit seeking an undisclosed amount of money in Seminole County, outside Orlando. Also named in the complaint were three reporters covering the story for NBC or an NBC-owned television station.












The complaint said the airing of the edited call has inflicted emotional distress on Zimmerman, making him fear for his life and causing him to suffer nausea, insomnia and anxiety.


The lawsuit claims NBC edited his phone call to a dispatcher in February. In the call, Zimmerman describes following Martin in the gated community where he lived, just moments before he fatally shot the 17-year-old teen during a confrontation.


“NBC saw the death of Trayvon Martin not as a tragedy but as an opportunity to increase ratings, and so set about to create a myth that George Zimmerman was a racist and predatory villain,” the lawsuit claims.


NBC spokeswoman Kathy Kelly-Brown said the network strongly disagreed with the accusations made in the complaint.


“There was no intent to portray Mr. Zimmerman unfairly,” she said. “We intend to vigorously defend our position in court.”


Three employees of the network or its Miami affiliate lost their jobs because of the changes.


Zimmerman is charged with second-degree murder but has pleaded not guilty, claiming self-defense under Florida’s “stand your ground law.”


The call viewers heard was trimmed to suggest that Zimmerman volunteered to police, with no prompting, that Martin was black: “This guy looks like he’s up to no good. He looks black.”


But the portion of the tape that was deleted had the 911 dispatcher asking Zimmerman if the person who had raised his suspicion was “black, white or Hispanic,” to which Zimmerman responded, “He looks black.”


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Asia stocks rise as US employment claims dip












BANGKOK (AP) — Asian stock markets rose Friday after the number of Americans seeking unemployment benefits fell last week, offsetting a somber economic forecast by the European Central Bank for a bleak year ahead in the region.


The U.S. Labor Department said Thursday that applications dropped 25,000 last week to a seasonally adjusted 370,000, a level consistent with modest hiring. The number of people continuing to receive unemployment aid also fell.












Japan’s Nikkei 225 index rose 0.1 percent to 9,554.09. South Korea’s Kospi added 0.4 percent to 1,958.13. Australia’s S&P/ASX 200 rose 1 percent to 4,552.40. Hong Kong’s Hang Seng rose 0.2 percent to 22,299.21.


On Thursday, the European Central Bank said that the economies of 17 countries that use the euro will contract next year. The central bank stopped short of offering new measures to boost growth and left its key interest rate unchanged at a record low.


The combined economy of the euro countries is in a recession after a massive debt crisis followed by government spending cuts and tax hikes that have hurt growth.


“Although the ECB left policy rates unchanged the post ECB meeting press conference effectively opened the door to a rate cut in Q1 next year following sharp downward revisions to growth projections and well below target inflation projected over the medium term,” said analysts at Credit Agricole CIB in Hong Kong.


Benchmark oil for January delivery was up 16 cents to $ 86.42 in electronic trading on the New York Mercantile Exchange. The contract fell $ 1.62, or 1.8 percent, to finish at $ 86.26 per barrel in New York on Thursday.


In currencies, the euro rose to $ 1.2969 from $ 1.2963 late Thursday in New York. The dollar rose to 82.47 yen from 82.36 yen.


___


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Toronto mayor to stay in power pending appeal of ouster












TORONTO (Reuters) – Toronto Mayor Rob Ford can stay in power pending an appeal of a conflict of interest ruling that ordered him out of his job as leader of Canada’s biggest city, a court ruled on Wednesday.


Madam Justice Gladys Pardu of the Ontario Divisional Court suspended a previous court ruling that said Ford should be ousted. Ford’s appeal of that ruling is set to be heard on January 7, but a decision on the appeal could take months.












Justice Pardu stressed that if she had not suspended the ruling, Ford would have been out of office by next week. “Significant uncertainty would result and needless expenses may be incurred if a by-election is called,” she said.


If Ford wins his appeal, he will get to keep his job until his term ends at the end of 2014. If he loses, the city council will either appoint a successor or call a special election, in which Ford is likely to run again.


“I can’t wait for the appeal, and I’m going to carry on doing what the people elected me to do,” Ford told reporters at City Hall following the decision.


Ford, a larger-than-life character who took power on a promise to “stop the gravy train” at City Hall, has argued that he did nothing wrong when he voted to overturn an order that he repay money that lobbyists had given to a charity he runs.


Superior Court Justice Charles Hackland disagreed, ruling last week that Ford acted with “willful blindness” in the case, and must leave office by December 10.


Ford was elected mayor in a landslide in 2010, but slashing costs without cutting services proved harder than he expected, and his popularity has fallen steeply.


He grabbed unwelcome headlines for reading while driving on a city expressway, for calling the police when a comedian tried to film part of a popular TV show outside his home, and after reports that city resources were used to help administer the high-school football team he coaches.


The conflict-of-interest drama began in 2010 when Ford, then a city councillor, used government letterhead to solicit donations for the football charity created in his name for underprivileged children.


Toronto’s integrity commissioner ordered Ford to repay the C$ 3,150 ($ 3,173) the charity received from lobbyists and companies that do business with the city.


Ford refused to repay the money, and in February 2012 he took part in a city council debate on the matter and then voted to remove the sanctions against him – despite being warned by the council speaker that voting would break the rules.


He pleaded not guilty in September, stating that he believed there was no conflict of interest as there was no financial benefit for the city. The judge dismissed that argument.


In a rare apology after last week’s court ruling, he said the matter began “because I love to help kids play football”.


Ford faces separate charges in a C$ 6 million libel case about remarks he made about corruption at City Hall, and is being audited for his campaign finances. The penalty in the audit case could also include removal from office.


(Reporting by Claire Sibonney; Editing by Janet Guttsman, Russ Blinch, Nick Zieminski; and Peter Galloway)


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Minecraft sells almost 4.5 million copies on Xbox 360 as other indie games continue to struggle












Big-budget games such as Halo 4 and Call of Duty: Black Ops II might brag about how they rule the Xbox 360 in terms of sales, but indie games can also compete – if they’re addictive enough and offer enough value. Take Minecraft, an indie game developed by Markus “Notch” Persson’s company Mojang. According to Mojang, Minecraftan indie game originally made for PC and ported to the Xbox 360 seven months ago has sold 4,476,904 copies as of the end of November with 40,000 to 60,000 copies sold every week. Minecraft is an anomaly because it doesn’t boast high-definition graphics that ooze of detailed lighting effects and didn’t cost millions of dollars to make, and yet it is the third-most played game on Xbox LIVE.


According to Gamasutra’s analysis and breakdown of November’s Xbox Live Arcade sales, only three other indie games managed to break 1 million copies downloaded last month. See below for the chart.












As you can see, every other game on Xbox Live Arcade other than Castle Crashers, Fruit Ninja Kinect, Happy Wars and Counter Strike: GO isn’t seeing the same type of success Minecraft is.


The lesson here is developers should always focus on the product and the users. If the gameplay mechanics are solid, the experience is fluid and bug-free, the gamers will come.


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Obama leads heads of state atop Forbes 2012 power list












NEW YORK (Reuters) – When it comes to power, politics trumps business, according to a new Forbes ranking on Wednesday that found heads of state occupying six of the top 10 spots among the world’s most powerful people, led by President Barack Obama.


The annual list selected what Forbes said were the world’s 71 most-powerful people from among the roughly 7.1 billion global populace, based on factors ranging from wealth to global influence.












Obama was joined in the top 10 by German Chancellor Angela Merkel, Russian President Vladimir Putin, King Abdullah bin Abdulaziz al Saud of Saudi Arabia and British Prime Minister David Cameron.


The list’s highest-ranked businessman was Microsoft co-founder Bill Gates at No. 4. U.S. Federal Reserve Chairman Ben Bernanke and European Central Bank President Mario Draghi, both public officials, also made the top 10.


“This year’s list reflects the changing of the guard in the world’s two most powerful countries: the United States and China,” Michael Noer, Forbes‘ executive editor, told Reuters in an email.


Noer noted that China’s President Hu Jintao, last year’s third most-powerful person, fell off the list as he is leaving power, and his successor, Xi Jinping, ranked ninth instead.


Both U.S. Treasury Secretary Timothy Geithner and Secretary of State Hillary Clinton, who have stated they will not be serving in Obama’s second term, were not in this year’s rankings.


While elected and appointed officials and business people made up the vast majority of Forbes’ most powerful, Pope Benedict XVI placed fifth in the rankings.


Among the oddities was Joaquin Guzman Loera at No. 63.


Loera, far from a household name, is a billionaire nicknamed “El Chapo” who as head of Mexico’s Sinaloa cartel is the world’s most powerful drug trafficker, according to Forbes.


Age was also not a barrier, with two of the youngest and oldest of this year’s most powerful — 28-year-old Facebook CEO Mark Zuckerberg and 81-year-old News Corp CEO Rupert Murdoch — back-to-back at numbers 25 and 26, respectively.


Forbes noted that Zuckerberg fell out of last year’s top 10 after Facebook’s IPO disappointed. A gainer, meanwhile, was Brazilian President Dilma Rousseff, who moved up four spots to No. 18 despite being only halfway into her first term of office.


To create the rankings, which Forbes readily concedes bore a measure of subjectivity, editors graded candidates on four criteria for power and averaged the four grades:


– Power over many people


– Control over financial and other valuable resources


– Power in multiple spheres or arenas


– Active use of power


Some measures, such as power over many people, favored leaders such as the Pope, while the world’s richest man — Mexican telecom magnate Carlos Slim Hula, worth a reported $ 72 billion — placed 11th on the strength of his wealth.


Others, such as New York’s billionaire Mayor Michael Bloomberg, scored high in all areas, placing him at No. 16.


Noer said that Elon Musk, one of the co-founders of Paypal and Tesla Motors, was “one of the more interesting newcomers” on the list due to his SpaceX company, a private space exploration venture.


“With NASA retiring the space shuttle fleet, private companies like SpaceX have been awarded huge contracts to do things like resupply the International Space Station. The commercialization of space is just beginning, but we expect it to be big business,” Noer said.


Former President Bill Clinton placed 50th, with editors noting that by hitting the campaign trail for Obama, Clinton “cemented his status as a kingmaker”, along with his nonpartisan Global Initiative raising more than $ 71 billion in commitments to fund charitable action worldwide.


Other high-ranking heads of state included French President Francois Hollande at No. 14, Indian Prime Minister Manmohan Singh at No. 19 and Iran’s Grand Ayatollah Ali Hoseini-Khamenei at No. 21.


Among businessmen in the top 20 were Berkshire Hathaway CEO Warren Buffett at No. 15, Wal-Mart CEO Michael Duke at No. 17 and Google co-founders Larry Page and Sergey Brin at No. 20.


The entire list can be found at www.forbes.com/power as well as the December 24 issue of the magazine.


(Reporting by Chris Michaud, Editing by Piya Sinha-Roy and Andrew Hay)


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Asia stocks mixed on Obama remarks












BANGKOK (AP) — Asian stock markets remained in a holding pattern Thursday as investors assessed President Barack Obama‘s comments that reaching a budget deal to prevent the U.S. from a possible recession was “not that tough” and could even be done quickly.


Obama’s remarks follow days of contentious negotiations between the White House and Congress on a deal to avert the so-called “fiscal cliff” of automatic spending cuts and tax increases at the start of next year. Without a deal, the U.S. could fall back into recession and drag much of the world down with it.












Wall Street stocks ended higher Wednesday after Obama was quoted telling business leaders in Washington that, despite a deep divide on critical issues, political leaders “can probably solve this in about a week, it’s not that tough.”


Obama is demanding that Republicans agree to raise tax rates for the richest Americans as part of a deal to rein in future deficits. Republican leaders say they will agree to higher revenue, but they want to close loopholes or reduce tax breaks rather than raise rates.


Chris Weston of IG Markets in Melbourne said in a market commentary that “there are distant signs that both parties should come to at least a short-term agreement. Certainly the market is seeing it that way and giving the situation the benefit of the doubt.”


Japan’s Nikkei 225 index rose 0.8 percent, in part buoyed by a weaker yen, to 9,541.21. South Korea’s Kospi rose 0.3 percent to 1,952.66. Hong Kong’s Hang Seng fell 0.1 percent to 22,245.56. Benchmarks in Indonesia, New Zealand and the Philippines rose while Singapore, Australia and mainland China fell.


Benchmark oil for January delivery was down 15 cents to $ 87.73 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell 62 cents to finish at $ 87.88 per barrel on the Nymex on Wednesday.


In currencies, the euro fell to $ 1.3056 from $ 1.3079 late Wednesday in New York. The dollar rose to 82.52 from 82.35 yen.


___


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Death toll from Philippine typhoon nears 300












NEW BATAAN, Philippines (AP) — Stunned parents searching for missing children examined a row of mud-stained bodies covered with banana leaves while survivors dried their soaked belongings on roadsides Wednesday, a day after a powerful typhoon killed nearly 300 people in the southern Philippines.


Officials fear more bodies may be found as rescuers reach hard-hit areas that were isolated by landslides, floods and downed communications.












At least 151 people died in the worst-hit province of Compostela Valley when Typhoon Bopha lashed the region Tuesday, including 78 villagers and soldiers who perished in a flash flood that swamped two emergency shelters and a military camp, provincial spokeswoman Fe Maestre said.


Disaster-response agencies reported 284 dead in the region and 14 fatalities elsewhere from the typhoon, one of the strongest to hit the country this year.


About 80 people survived the deluge in New Bataan with injuries, and Interior Secretary Mar Roxas, who visited the town, said 319 others remained missing.


“These were whole families among the registered missing,” Roxas told the ABS-CBN TV network. “Entire families may have been washed away.”


The farming town of 45,000 people was a muddy wasteland of collapsed houses and coconut and banana trees felled by Bopha’s ferocious winds.


Bodies of victims were laid on the ground for viewing by people searching for missing relatives. Some were badly mangled after being dragged by raging flood waters over rocks and other debris. A man sprayed insecticide on the remains to keep away swarms of flies.


A father wept when he found the body of his child after lifting a plastic cover. A mother, meanwhile, went away in tears, unable to find her missing children. “I have three children,” she said repeatedly, flashing three fingers before a TV cameraman.


Two men carried the mud-caked body of an unidentified girl that was covered with coconut leaves on a makeshift stretcher made from a blanket and wooden poles.


Dionisia Requinto, 43, felt lucky to have survived with her husband and their eight children after swirling flood waters surrounded their home. She said they escaped and made their way up a hill to safety, bracing themselves against boulders and fallen trees as they climbed.


“The water rose so fast,” she told AP. “It was horrible. I thought it was going to be our end.”


In nearby Davao Oriental, the coastal province first struck by the typhoon as it blew from the Pacific Ocean, at least 115 people perished, mostly in three towns that were so battered that it was hard to find any buildings with roofs remaining, provincial officer Freddie Bendulo and other officials said.


“We had a problem where to take the evacuees. All the evacuation centers have lost their roofs,” Davao Oriental Gov. Corazon Malanyaon said.


The International Federation of Red Cross and Red Crescent Societies issued an urgent appeal for $ 4.8 million to help people directly affected by the typhoon.


The sun was shining brightly for most of the day Wednesday, prompting residents to lay their soaked clothes, books and other belongings out on roadsides to dry and revealing the extent of the damage to farmland. Thousands of banana trees in one Compostela Valley plantation were toppled by the wind, the young bananas still wrapped in blue plastic covers.


But as night fell, however, rain started pouring again over New Bataan, triggering panic among some residents who feared a repeat of the previous day’s flash floods. Some carried whatever belongings they could as they hurried to nearby towns or higher ground.


After slamming into Davao Oriental and Compostela Valley, Bopha roared quickly across the southern Mindanao and central regions, knocking out power in two entire provinces, triggering landslides and leaving houses and plantations damaged. More than 170,000 fled to evacuation centers.


As of Wednesday evening, the typhoon was over the South China Sea west of Palawan province. It was blowing northwestward and could be headed to Vietnam or southern China, according to government forecasters.


The deaths came despite efforts by President Benigno Aquino III’s government to force residents out of high-risk communities as the typhoon approached.


Some 20 typhoons and storms lash the northern and central Philippines each year, but they rarely hit the vast southern Mindanao region where sprawling export banana plantations have been planted over the decades because it seldom experiences strong winds that could blow down the trees.


A rare storm in the south last December killed more than 1,200 people and left many more homeless.


The United States extended its condolences and offered to help its Asian ally deal with the typhoon’s devastation. It praised government efforts to minimize the deaths and damage.


___


Associated Press writers Jim Gomez, Teresa Cerojano and Oliver Teves in Manila contributed to this report.


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In brewing rivalry, Instagram trims ties to Twitter












SAN FRANCISCO (Reuters) – Facebook Inc’s recently acquired photo-sharing service Instagram removed a key element of its integration with Twitter, signaling a deepening rift between two of the Web’s dominant social media companies.


Instagram Chief Executive Kevin Systrom said Wednesday his company turned off support for Twitter “cards” in order to drive Twitter users to Instagram’s own website. Twitter “cards” are a feature that allows multimedia content like YouTube videos and Instagram photos to be embedded and viewed directly within a Twitter message.












The move marked the latest clash between Facebook and Twitter since April, when Facebook, the world’s no. 1 social network, outbid Twitter to nab fast-growing Instagram in a cash-and-stock deal valued at the time at $ 1 billion. The acquisition closed in September for roughly $ 715 million, reflecting Facebook’s recent stock drop.


The companies’ ties have been strained since. In July, Twitter blocked Instagram from using its data to help new Instagram users find friends.


Beginning earlier this week, Twitter’s users began to complain in public messages that Instagram photos did not seem to display properly on Twitter’s website.


Systrom confirmed Wednesday that his company had decided its users should view photos on Instagram’s own Web pages and took steps to change its policies.


“We believe the best experience is for us to link back to where the content lives,” Systrom said in a statement, citing recent improvements to Instagram’s website.


“A handful of months ago, we supported Twitter cards because we had a minimal Web presence,” Systrom said, noting that the company has since released new features that allow users to comment about and “like” photos directly on Instagram’s website.


The move escalates a rivalry in the fast-growing social networking sector, where the biggest players have sought to wall off access to content from rival services and to their ranks of users.


“They’re both competing for slices of the same pie, the pie being users’ attention,” said Ray Valdes, an analyst with research firm Gartner.


If Facebook decides to offer advertising on Instagram, it’s important that the users visit Instagram’s own website, said Valdes. “If the eyeballs are elsewhere, you have less to work with in terms of monetization,” he said.


Photos are among the most popular features on both Facebook and Twitter, and Instagram’s meteoric rise in recent years has further proved how picture-sharing has become a key front in the battle for social Internet supremacy.


Instagram, which has 100 million users, allows consumers to tweak the photos they take on their smartphones and share the images with friends, a feature that Twitter has reportedly also begun to develop. Twitter’s executive chairman, Jack Dorsey, was an early investor in Instagram and had hoped to acquire it before Facebook CEO Mark Zuckerberg made a successful bid.


When Zuckerberg announced the acquisition in an April blog post, he highlighted Instagram’s inter-connectivity with other social networks.


“We think the fact that Instagram is connected to other services beyond Facebook is an important part of the experience,” Zuckerberg wrote. “We plan on keeping features like the ability to post to other social networks.”


A Twitter spokesman declined comment Wednesday, but a status message on Twitter’s website confirmed that users are “experiencing issues,” such as “cropped images” when viewing Instagram photos on Twitter.


(Reporting By Alexei Oreskovic and Gerry Shih; Editing by Nick Zieminski and Leslie Adler)


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