The International Herald Tribune writes that “

[s]ince the credit crisis began gripping the financial world, Silicon Valley has watched from the sidelines, secure in the faith that it was insulated from the coming storm.  That faith is now being seriously undermined. High-tech entrepreneurs, investors and executives now believe the question is when, not if, the financial chaos will hurt the country’s cradle of innovation.  From San Francisco to San Jose, the effects are already palpable. This week, Apple, one of the Valley’s high-fliers, lost 16.3 percent of its value as investors reasonably concluded that consumers would shun expensive gadgets over the holidays in favor of lower-ticket items — or paying down their credit cards.”

Yahoo!Tech reports that “Microsoft launched on Friday a software package for a Portuguese ultra-cheap laptop for school children that the government hopes will boost the country’s technological edge in education.  Portugal started rolling out the ‘Magellan’ computer at schools last month. It aims to hand out a total 500,000 of the laptops, which cost just 50 euros ($69.29) for school children, at home and export it to countries in Latin America and Africa.  Microsoft CEO Steve Ballmer unveiled the software package called ‘Suite Magellan’ to go with the laptops, which will include Windows XP and Office in addition to development applications, free email and instant messaging.”

The Wall Street Journal reveals that, in recent months, “some of [Google’s] executives have been pushing for the company to overcome its aversion to paid advertising. That has created some conflict within [the company], which is maturing and looking to reinvigorate its slowing growth.  An episode around the Olympics earlier this year illustrates the tensions. Some Google employees were considering a plan to sell airtime during the NBC broadcast to other advertisers and to take out a spot to promote a Google product as well, according to people familiar with the matter.  The idea didn’t get past Google founders Sergey Brin and Larry Page, who felt a splashy television ad wouldn’t fit with Google’s image, these people said. A Google spokesman declined to comment.  But there are signs that the internal debate is causing Google to shake-off of its reluctance to advertise. The search giant has recently held discussions with several Madison Avenue agencies, including Wieden + Kennedy and the boutique firm Taxi New York, about new efforts to promote some products, according to people familiar with the matter.”

According to Internetnews.com, “iPhone users eagerly awaiting Adobe’s Flash technology shouldn’t hold their breath — despite the fact that a mobile version of the online multimedia software is nearly ready for Apple’s smartphone.  The reason? It doesn’t look like the two companies are going to settle into a collaborative partnership anytime soon, which ensures that Apple’s needed sign-off on the technology won’t be forthcoming. That’s in spite of the fact that online multimedia and interactivity — and video, in particular — have become a big part of the growing allure of smartphones.”

The Mercury News today has another article on the slow IPO market for venture-backed high-tech firms.