The company is trying to address a lack of coordination and spark innovation within the $74 billion annual revenue, 98,000-employee organization. The flagship Windows operating system, developed separately for PCs and mobile devices, will now be folded into one group, for instance.

The moves, many of which had been widely reported, re-align the company's operations to achieve Chief Executive Steve Ballmer's goal of becoming a "devices and services" corporation.

Microsoft, which has been struggling to compete in a world of mobile devices and Web-based services dominated by Apple Inc and Google Inc, launched the Surface tablet in 2012. But the device has failed to make meaningful headway against the iPad or Google Android devices made by Samsung Electronics and others.

Its Windows 8 release last year also alienated PC users accustomed to a long-established interface, prompting Microsoft to bring back, among other things, the familiar "Start" button in a hasty update. All operating systems now come under Terry Myerson, who previously headed up Windows Phone and the software giant's efforts to crack the mobile market.

"You don't do a major reorganization like this unless you have some serious problems," BGC analyst Colin Gillis said.

"It can be a major distraction. The details have to be ironed out, there will be a lot of water-cooler talk and that's happening as the company has some critical products coming out, like a unified phone, Xbox."

Ballmer is trying to bring products to the market faster and make the company more efficient, and wants to entice people to use Microsoft products, like Word and Office, on a variety of devices besides personal computers.

"We are rallying behind a single strategy as one company — not a collection of divisional strategies," Ballmer said in a memo to employees published on Microsoft's website on Thursday.

The company's shares were up 1.98 percent at $35.39 in midday trade on the Nasdaq.

A NEW ERA?

Microsoft has been struggling with sharply declining personal computer sales that cut into its software revenue as consumers and some businesses increasingly favor smartphones and tablets.

Worldwide PC shipments declined 11.4 percent in the second quarter, according to industry research firm IDC.

It says consumers will be able to zoom in and reframe their photos without worrying about the image quality suffering.

Analysts who have tested the device said that it was "without doubt" the best smartphone camera on the market.

But they added that was not a guarantee that it would be a bestseller.

Market research firm IDC recently carried out a survey of smartphone owners in 25 countries to identify what factors were most likely to drive future purchases.

The results placed camera resolution 15th on a list of 23 features. Audio quality for voice, battery life, device security and browsing came top of the poll.

"Most people just look at their photos on their smartphone or via a social network on a computer - and for this the other vendors already provide very good quality," Francisco Jeronimo, a mobile phone analyst at the firm, told the BBC.

"Nokia needs to convince consumers that this new handset outperforms others in low-light conditions, otherwise they would only really notice the difference if they zoomed in on the images on a large screen or printed out a poster. "It may be the best smartphone out there but I doubt it will be enough to convince many users to jump platform from Android or iOS which accounted for 92% of global shipments in the last quarter."

Zoomable video

The Lumia 1020 marks the second time Nokia has fitted a 41MP sensor to one of its phones.

Last year it launched the Pureview 808 model, but its appeal was limited by the fact it ran the ageing Symbian operating system for which few developers are still writing software. The new handset instead runs on Microsoft's Windows Phone platform which has more than 160,000 apps. As well as offering highly detailed photos at up to 38MP resolution, the new phone also uses a process called "oversampling" to combine the pixels of an image into a smaller 5MP version from which it removes unwanted visual noise.

Unlike its predecessor, the Lumia 1020 can save both types at the same time, meaning that the owner does not need to worry about switching settings.

In addition, the handset's video recording capabilities take advantage of the extra resolution, allowing the user to zoom in four times while recording a 1080p high definition video without losing quality, and six times into a 720p version.

The staffs of Senator John Rockefeller, the West Virginia Democrat who chairs the committee, and his Republican counterpart Senator John Thune of South Dakota late on Wednesday released what is expected to be the first of several Senate bills aimed at improving U.S. defenses against cyber attacks, a committee source said.

Rockefeller expects the committee to debate the bill by the end of July, the source said. It will be part of a lengthy, complex process of reconciling interests in Congress, the private sector and the government as the country faces a growing threat of hacking attacks and cyber espionage.

The new bill follows the path laid out by President Barack Obama's executive order in February. That order directed the National Institute of Standards and Technology, a non-regulatory agency within the Commerce Department, to develop the framework for collaboration between the government and the private sector over improving cyber protections.

The Senate's new bill would formally add cybersecurity to NIST's statutory authority to ensure it continues to work with the industry on voluntary standards and best practices after Obama's order expires. The draft also seeks to better educate Americans in cybersecurity, improve research in the field and start a public awareness campaign.

The House of Representatives in April for the second time passed a bill designed to help companies and the government share information on cyber threats. It did not address industry standards and the Obama administration has threatened to veto it over privacy concerns.

Revelations about the scale of US government spying meant emotions in the hacking world were "running high", said organisers of the Def Con convention.

As a result, federal agents should take a "timeout" from Def Con this year.

The main Def Con event takes place in Las Vegas from 1 August and will see 15,000 hackers debate security topics and demonstrate their coding prowess.

Freely mix

The request was posted to the main Def Con webpage by Jeff Moss, the founder of the hacking conference.

In the past, he said, the convention had been an "open nexus" where government security staffers and law enforcement agents could freely mix and share ideas with the other hackers, researchers and security professionals that attended.

"Our community operates in the spirit of openness, verified trust, and mutual respect," he said, a state of affairs that had led to an exchange of information that had seemed mutually beneficial.

However, wrote Mr Moss, many people now questioned that free exchange of ideas in the wake of ongoing disclosures about the US National Security Agency's Prism programme, which, since 2007, has been scooping up huge amounts of data about people's online activity.

As a result, "it would be best for everyone involved if the feds call a 'timeout' and not attend Def Con this year," he wrote.

"A little bit of time and distance can be a healthy thing, especially when emotions are running high," Mr Moss told Reuters.

Despite the request, Def Con organisers were not going to be checking the identities of everyone who attended to weed out federal agents and send them packing, he added.

Paper plea

Def Con's request comes as Yahoo seeks permission to publish information about a key legal case in 2008 that let the US government establish and justify Prism.

Yahoo has filed legal papers asking for permission from the Foreign Intelligence Surveillance Court (Fisc), which decides whether US government departments such as the National Security Agency can carry out surveillance programmes.

In 2008, Yahoo had "objected strenuously" to the Fisc over requests for it to co-operate with the early Prism programme, it said. But its objections had been over-ruled by the Fisc.

The study, in the journal Science, showed the three patients were now going to school.

A second study published at the same time has shown a similar therapy reversing a severe genetic disease affecting the immune system.

Gene therapy researchers said it was a "really exciting" development.

Both diseases are caused by errors in the patient's genetic code - the manual for building and running their bodies.

Decline

Babies born with metachromatic leukodystrophy appear healthy, but their development starts to reverse between the ages of one and two as part of their brain is destroyed.

Wiskott-Aldrich syndrome leads to a defective immune system. It makes patients more susceptible to infections, cancers and the immune system can also attack other parts of the body.

The technique, developed by a team of researchers at the San Raffaele Scientific Institute in Milan, Italy, used a genetically modified virus to correct the damaging mutations in a patient's genes.

Bone marrow stem cells are taken from the patient then the virus is used to 'infect' the cells with tiny snippets of DNA which contain the correct instructions. These are then put back into the patient.

Three children were picked for treatment from families with a history of metachromatic leukodystrophy, but before their brain function started to decline.

Dr Alessandra Biffi told the BBC: "The outcome has been very positive, they're all in very good condition, with a normal life and going to kindergarten at an age when their siblings were unable to talk.

"It is something which is very pleasing to us."

'New era'

She said that all treatments had side effects and these patients needed to be followed for longer, but the evidence so far suggested the treatment was safe.

Gene therapy is a field that has promised far more than it has delivered and has been hampered by serious concerns about safety.

Dr Biffi said lessons had been learnt from previous failings: "Experience showed that gene therapy could be improved and we could be at the starting point for a new era to achieve more than we did in the past."

In the other study, published simultaneously in the journal Science, symptoms such as repeat infections and eczema had lessened in the three patients treated.

Unless Republicans allow them all to be confirmed, Reid, a Nevada Democrat, may move to strip Republicans of their ability to block nominees with procedural hurdles known as filibusters, Democratic aides said.

The Senate requires 67 votes to change its rules, including those regarding filibusters. But under a procedural power play known as "the nuclear option," Reid could do it with just 51. His Democrats control the Senate, 54-46.

Their aim would be to reduce to a simple majority from 60 the votes needed to end filibusters on executive branch nominees. A 60-vote threshold would remain for judicial nominees as well as legislation, aides said.

In a heated exchange on the Senate floor, Reid accused Senate Republican leader Mitch McConnell of breaking an agreement reached in January to make the Senate confirmation process more efficient and less hostile.

McConnell, of Kentucky, angrily denied it and accused Reid of concocting "a phony crisis" as an excuse to break his own promise on Senate's rules.

"If this isn't a power grab, I don't know what a power grab looks like," McConnell roared.

Reid said he would schedule votes next week on as many as a dozen or so nominations, aides said.

They are expected to include Gina McCarthy to head the Environmental Protection Agency, Thomas Perez to be U.S. labor secretary, and Richard Cordray to be director of the Consumer Financial Protection Bureau, along with at least three members of the National Labor Relations Board.

NO MOOD TO COMPROMISE

A senior aide said Reid is in no mood to compromise, and would not drop his threat to eliminate filibusters on nominations if Republicans agree to confirm just some of them.

"We want all of them," the aide said.

Reid charged that Republicans have blocked nominees not because they are unqualified, but because Republicans often do not like the pro-consumer, pro-labor and pro-environment agencies that they have been named to head.

But McConnell countered that scores of Obama's nominees have been confirmed this year, including a number of his Cabinet secretaries, many with broad bipartisan support. He accused Reid of trying to pick a fight to fire up the Democrats' liberal base, particularly organized labor.

Britain says it has not yet taken any decision to arm rebels fighting to topple President Bashar al-Assad, but its role in helping to lift a European Union arms embargo on Syria in May fuelled speculation it was planning to do just that.

The lower house of parliament voted by 114-1 to back a motion requiring the government to seek its "explicit prior consent" for any future decision to provide lethal assistance.

Though symbolic, the move is significant as it means Cameron will find it almost impossible not to give parliament a vote on the issue, something government sources say would amount to an effective veto over any decision to supply arms.

Ministers expect the 650-member lower house to vote against sending arms if the issue arises, said one government source.

Many lawmakers in Cameron's Conservative Party say they are worried a decision to arm the moderate opposition in Syria would escalate and widen the conflict and risk weapons falling into the hands of Islamist extremists.

"The government has discussed the option of arming the rebels. This would be a major policy change. This debate allows us to mark the government's card," said John Baron, a Conservative lawmaker who secured Thursday's vote.

The papal decree broadens the definition on crimes against minors to include sexual abuse of children.

Earlier this year, Pope Francis said that dealing with sex abuse was vital to the Church's credibility.

The decree also increases the Vatican's international co-operation in combating crimes, and raises penalties for those who leak official papers.

The BBC's David Willey in Rome says Pope Francis's order continues a process started by his predecessor Benedict XVI, aimed at bringing the Vatican into line with modern international norms.

The Vatican's legal system closely follows that of Italy, but given the special nature of the city state set up in 1929, there has until now been more emphasis on legal exemptions rather than on law enforcement, our correspondents adds.

The updated legislation covers more than 5,000 clergy and lay people who live and work in the Vatican - and is different from the canon law which covers the universal Catholic Church.

What the butler leaked Under the changes, child prostitution, sexual violence, sexual acts with children and indecent images of children will be included in a broader definition of the category of "crimes against minors".

On Wednesday the UN Committee on the Rights of the Child asked the Vatican to disclose details of thousands of cases of child abuse committed by members of the clergy.

The latest papal decree says the Vatican wants to review its commitment to international conventions against crimes such as money-laundering and financing terrorism.

The reforms extend the criminal liability of Vatican officials, making it possible to indict them even for crimes committed outside the city state.

Last month Pope Francis set up a commission to review the affairs of the Vatican Bank, which has been hit by long-standing allegations of corruption and money laundering.

The new laws - which come into effect in September - also increase punishment for anyone stealing secret papers.

U.S. District Judge Denise Cote in Manhattan found "compelling evidence" that Apple violated federal antitrust law by playing a "central role" in a conspiracy with the publishers to eliminate retail price competition and raise e-book prices.

The decision could expose Apple to substantial damages. It is a victory for the U.S. Department of Justice and the 33 U.S. states and territories that brought the civil antitrust case.

Apple was accused of pursuing the conspiracy to undercut online retailer Amazon.com Inc's e-book dominance, causing some prices to rise to $12.99 or $14.99 from the $9.99 that Amazon charged. Amazon once held a 90 percent market share.

"Apple chose to join forces with the publisher defendants to raise e-book prices and equipped them with the means to do so," Cote said in a 159-page decision. "Without Apple's orchestration of this conspiracy, it would not have succeeded as it did."

Wednesday's decision was not a total surprise, given that Cote indicated before the 2-1/2 week non-jury trial began on June 3 that Apple's defenses might fail. Cote ordered a trial to set damages.

"This result is a victory for millions of consumers who choose to read books electronically," Bill Baer, head of the Justice Department's antitrust division, said in a statement. "This decision by the court is a critical step in undoing the harm caused by Apple's illegal actions."

APPLE PLANS TO APPEAL

In a statement, Apple maintained that the plaintiffs' allegations are false and said it will appeal Cote's decision.

"Apple did not conspire to fix e-book pricing," Apple spokesman Tom Neumayr said. "When we introduced the iBookstore in 2010, we gave customers more choice, injecting much needed innovation and competition into the market, breaking Amazon's monopolistic grip on the publishing industry. We've done nothing wrong."

Last year, Apple settled a separate antitrust case over e-book pricing with the European Commission, without admitting wrongdoing.

The alleged collusion began in late 2009 and continued into early 2010, in connection with the Silicon Valley giant's launch of its popular iPad tablet.

Only Apple went to trial, while the publishers agreed to pay more than $166 million combined to benefit consumers.

NATO's cyber defense nerve center, operating from the alliance's operational headquarters at Mons in southern Belgium, monitors potential attacks on NATO computer systems installed at 55 locations around the world.

"Our intrusion detection systems handle something like 147 million suspicious events every day," director Ian West told reporters during a visit to NATO's computer incident response capability technical center on Wednesday.

Attacks on NATO's systems range from hacking, attempts to implant malicious software and so-called denial of service attacks where a computer is bombarded with so much data that it collapses.

NATO analysts dealt with around 2,500 confirmed serious attacks on its computers last year, West said.

In an era where weapon systems and military operations increasingly depend on computers, there is a risk that hacking attacks could have fatal consequences for the alliance.

"The worst case scenario of a cyber attack for us could be loss of life ... If intelligence doesn't get through about an ambush, if notification doesn't get through about a security situation, then our troops' lives are at risk," West said.

Some attacks against NATO's computer networks have been successful, he said, although he declined to say whether hackers had succeeded in stealing confidential data.

The threats come from hacking activists, criminals and "hostile nation states", although West declined to say which countries are suspected.

In May, the Pentagon said China was using espionage to acquire technology to fuel its military modernization, for the first time accusing the Chinese of trying to break into U.S. defense computer networks. Beijing denied the allegation.

China hit back after fugitive spy agency contractor Edward Snowden leaked details of U.S. cyber spying, accusing Washington of hypocrisy.

SPEAR PHISHING

Analysts among the cyber defense centre's 130-strong staff from 15 nations say the attacks on NATO defense systems are growing in number and sophistication.

"The majority of the attacks are conducted by 'spear phishing' emails," said Andrzej Dereszowski, a Polish engineer at the center, referring to attempts by hackers to get hold of passwords or other confidential information by posing as a legitimate organization.

Icahn opposes the proposal from Michael Dell and private equity firm Silver Lake, arguing it undervalues the PC maker, and has put forth a number of alternative options in concert with fellow Dell shareholder Southeastern Asset Management.

Earlier this week, however, shareholder advisory firms Institutional Shareholder Services, Glass Lewis and Egan Jones threw their support behind Michael Dell's offer.

In his latest effort to derail Michael Dell's plans, Icahn wants shareholders to vote against the buyout and then ask a court in Delaware, where Dell is incorporated, to appraise the fair value of the shares.

"We believe if you seek appraisal, you will receive more," Icahn said in a letter to Dell shareholders.

Icahn said Dell shareholders could change their minds about the appraisal up to 60 days after the merger.

During that time "we believe Dell may wish to negotiate with those that sought appraisal and possibly pay a premium over $13.65 to get them to settle and drop their appraisal claims," he said.

Should shareholders change their minds they can still sell for $13.65, Icahn said in the letter, adding "you can have your cake and eat it too."

Dell shareholders are scheduled to vote on the buyout offer proposed by Michael Dell and Silver Lake on July 18.

On Tuesday, Yacktman Asset Management, which owns about 0.85 percent of Dell stock, said it favored Icahn and Southeastern's proposal that would see shareholders tender 1.1 billion shares at $14 each.

For that bid to be put to a vote, shareholders must reject Michael Dell's proposal and then elect a new slate of directors put up by Icahn.

Undertexter had provided fan-made translations of film and TV show dialogue, which could be merged with video files to provide on-screen text.

A spokesman for the police told the BBC they had acted after investigating a complaint by copyright holders.

Undertexter's managers insisted they had not broken the law.

Critics have suggested the raid marked an escalation in Hollywood's efforts to protect its intellectual property.

However, the Rights Alliance - the organisation that prompted the police to act - said it was not the first case of its kind in Europe.

Forensic tests

The national co-ordinator of the intellectual property crime division at the Swedish Police Service said that it had carried out the raid after tracking computers using Undertexter's internet addresses to buildings in Stockholm and Helsingborg.

"Our copyright law doesn't allow people to make a transcript from a film that is copyright-protected without the copyright owner's permission and certainly not to make it public," said Paul Pinter.

"The investigation is still in its early stages. Our forensic experts will now go through the material on the seized computers and there will be follow-up interviews."

He added that potential penalties ranged from fines to up to two years in jail.

The Rights Alliance said its members had been concerned that Undertexter had "a lot of" adverts on it, suggesting the owners were profiting from "the work of others".

"There were several reasons for us to act against the site," said Sara Lindback, a lawyer for the group.

"The movies they put subtitles on have often not yet reached Sweden or are still in cinemas. The translations have not been cleared by the rights-holders."

She added that the move followed the trial of a man in Norway last year who had run Norsub, a similar service.

A judge fined the 26-year-old 15,000 kroner ($2,450; £1,640) after hearing he had not profited from the site and had shut it down shortly after being warned he was breaking the law.

'Free country'

A post on Undertexter's Facebook page indicated its managers intended to fight on.

"Hollywood... we will never give up, we live in a free country and Swedish people have every right to publish their own interpretation of a movie/series," they wrote.

They added that they had never charged for the service.