Hidden gems of the Webby Award nominees

The Humans of New York site, which featues photos of everyday New Yorkers, has been nominated for a Webby Award.

(CNN) -- The annual Webby Awards are always a treasure trove of fascinating sites and apps. The organization behind the awards, the International Academy of Digital Arts and Sciences, announced thelatest, lengthy list of nominees on Tuesday.

The awards started in 1996 and over the past 17 years have expanded to include categories such as mobile apps, ad campaigns and online videos. For the final Webbys list, the academy narrowed down 11,000 applications to find five nominees for each category, as well as some honorable mentions. Though the official winners will be chosen by academy members, anyone can vote for the People's Voice Awards.

Big names and major brands with sizable marketing budgets tend to dominate the nominations. Nike nabbed the most nominations, followed by Google and The New York Times. But the list is also an excellent place to find some cool and unusual projects that you may have missed over the past year. We dug through to find some our favorites.

Milwaukee Police News

A website for a local police department seems like an unlikely place to find inspirational Web design, but the official page for the Milwaukee Police news is a stunner. Look through crime stats, browse photos of the most wanted criminals, and check out a timeline of the department's history, all on a background of amazing photos of the department.

The Space

Take a break from the usual streaming (Hulu, Amazon, Netflix, YouTube) and enjoy some free on-demand video and content about dance, opera, music, art and more on the The Space, a site from the Arts Council England and the BBC. Start with one of the five short films about David Bowie or flip through the site's sizable photography collection.

Gallery of Lost Art

The Gallery of Lost Art from Tate is an interactive online exhibit tracing the stories of missing art. Some pieces were stolen, others destroyed or thrown out. The site combines art history and intriguing mystery using high-resolution images, essays and videos.

Humans of New York

This photography site is based on a straightforward premise: capturing photos of everyday New Yorkers. Luckily, there seems to be an inexhaustible supply of interesting New Yorkers, making the site an addictive time-suck. Photographer Brandon Stanton also includes captions that capture bits of his subjects' lives.

Clouds over Cuba

This expertly crafted interactive documentary on the Cuban missile crisis from the John F. Kennedy Presidential Library has archival video footage, documents, audio clips, and fresh interviews. You can watch from beginning to end or skip around on the timeline.

Bloomberg Billionaires

Ever wonder who the richest people in the world are? This collection of dossiers lets you search for billionaires by age, gender, country, industry and source of wealth. View the index on a map to find the billionaire nearest you and invite him or her over for tea. Each person has a colorful profile page that includes a biography, summary of net worth, and a slideshow of possessions. The index is updated daily.

First men on the moon

Relive the 1969 moon landing with this minute-by-minute re-creation that puts you in mission control. It uses real audio clips from the Apollo 11 landing with photos and names indicating who's talking. The center of the screen shows video from the landing and graphics at the bottom show the lunar model's angle.

Chaos to perfection

If you can't make it to France to see the stunning Versailles grounds in person, this site is the next best thing. A fully realized 3-D model of the royal palace, it takes you through areas like the Grand Canal, the Hall of Mirrors and the King's Bedchamber, where you can explore every angle. This project is a collaboration between the Chateau de Versailles and the Google Cultural Institute.

Lumosity

A workout for your brain, Lumosity features training exercises developed by neuroscientists to help improve your memory, problem-solving skills and concentration. Researchers can then mine the data collected by Lumosity to learn more about human cognition. The service has over 35 million users.

REI 1440 Project

One of many marketing campaigns among the nominees, the REI 1440 Project is a soothing, crowdsourced collection of travel photos from outdoorsy types around the world. The images are organized according to their time stamps to make up a 24-hour timeline of shots.

Chrome Web Lab

Google projects are spread throughout the Webby nominations, and with good reason. The experiment-happy company has created the Chrome Web Lab projects to show off the browser's processing power. There's an interactive orchestra, live videos from around the world, and a real robot that will draw your portrait in sand at the Science Museum in London.

Beatbox Academy

Ever been at a party and thought, "If I only knew how to beatbox I could really kick this event up a notch, maybe make some friends"? Head over to Beatbox Academy and get started mixing your own tunes with the interactive beatbox machine. The site is promoting a DVD that teaches you how to beatbox in the comfort of your home.

FixYa

On this site it's possible to get help fixing pretty much anything, including computers, fax machines, hair driers, cars and tattoo guns. Look up your broken device to find manuals, issues and solutions from other members, or ask your question and hope an expert comes back with a helpful answer.

Sitegeist

Tap into your smartphone's location features to learn more about the world around you. This app shows stats like Census Bureau facts (age, gender), weather, Foursquare favorites, average rents and recommended places to grab food. Another app for discovering information based on your location, History Here, finds historical facts for your area.

The Silent History

This is a book, but it's also an app that mixes in user-generated feedback and location-based participation. The serialized piece of fiction draws the reader in with interactive elements, creating a new kind of narrative that could be the future of e-books.

Facebook uses offline purchases to target ads

Facebook is allowing advertisers to target individual users based on offline purchases.

NEW YORK (CNNMoney)

If you head to a department store to buy a pair of jeans, you might start seeing a lot of ads for pants on Facebook.

For the first time, Facebook ads will target specific users based on their past buying history -- even if the purchases happened offline. Facebook unveiled the new feature for advertisers, called "Partner Categories," on Wednesday.

The feature works with information from massive consumer data companies Acxiom (ACXM), DataLogix and Epsilon. These are companies that know all about you: your income level, your online activity, your Social Security number, what you've bought recently, and even whether you've served time in prison.

Facebook (FB) Partner Categories matches the social network's user-generated data with the information from the data companies to create dossiers on its users. Facebook then groups those specific users into categories like "people who are heavy buyers of frozen foods," and advertisers can serve ads to those curated groups.

Previously, advertisers could target only general groups based on user-supplied information: for example, women in California who list surfing as an interest.

In a blog post about the new product, Facebook was quick to note that the data are anonymized on both sides. That is, while advertisers can target groups of specific users, they never know the identities of the users they're advertising to.

Partner Categories advertisers see only the size of the group, and details about why these users were grouped -- for example, they're customers with a grocery store loyalty card who buy three times as much cereal as the national average.

The pairing of these data sources is sure to incense critics of the company's data practices, though Facebook also noted in its post that "companies have long used this type of targeting off of Facebook."

"We think that this new type of targeting is both more relevant for people and can be even more effective for advertisers," said Elisabeth Diana, spokeswoman for Facebook. "We think we can serve both in a privacy-safe way."

At launch, advertisers can choose from 500 of these "partner categories," and further refine by data like gender or age. Facebook said users will be able to see how and why they were targeted for a certain ad, and they have the ability to opt out of ads from certain advertisers or from partner categories altogether.

By adding this type of highly targeted advertising capability, Facebook clearly wants to create more value for advertisers -- which could result in more revenue for Facebook.

The social network has over a billion users, but in 2012, the company's average revenue per user was just $5.32. That's only a 6% increase from 2011, and it's far lower than other companies that report the metric.

Still, advertising remains Facebook's bread and butter. Ads accounted for 84% of Facebook's revenue in 2012, and the company has continued to release site updates that toe the line between calling attention to ads and not annoying users. For example, last month's News Feed revamp centered around a more visual design that also includes bigger graphics for ads in users' news feeds. 

Apps beating web-style ad networks for mobile advertising dollars

A new report by IDC highlights that apps such as Facebook, Twitter and Pandora are beating mobile ad networks in grabbing new ad revenue, a trend the research group failed to predict in its last report. Ad revenues are still a tiny fragment of overall mobile revenues however.

IDC noted in a new $1,995 report from its prediction team that revenue from ad networks took a back seat to ad revenue from "mobile publishers" such as Facebook, Pandora and Twitter, which handle their own advertising.

The shift occurred rapidly, the firm stated, with independent app publishers' ad revenue share jumping from 39 percent in 2011 to a majority 52 percent split in 2012. 

The entire pie for mobile ad dollars more than doubled in one year, growing from $630 million in 2011 to $1.7 billion in 2012. In contrast, the revenue collected by the top four ad networks (Google, Millennial Media, Apple's iAd and Jumptap) only grew by 47 percent. Ad networks push display ads into participating developer's apps, much the same way that display ads are delivered on the web.

"Mobile ad networks are losing market share to publishers, and we expect them to lose even more going forward," said Karsten Weide, IDC's Vice President of Media & Entertainment.

IDC failed to predict the shift last year as it bashed iAd

One year ago, Weide seemed primarily focused on denigrating Apple's iAd, telling the Wall Street Journalthat "Apple we believe will, over time, fade into the background," in the market for mobile ads, apparently because Apple's iAd program only advertised to iOS devices.

IDC's Weide didn't point out that, rather than "fading into the background," Apple's iAd jumped from $95 million to $125 million over the previous year, an increase of over 30 percent. Instead, it reported that Millennial Media had "taken over Apple to claim the number 2 spot."

However, IDC already reported last year that Millennial Media had a larger share of the mobile ad market than Apple (prominently depicted in a graphic based on IDC's, shown below). This year, in fact, the influx of new ad revenue from independent app publishers made Millennial Media's market share advantage over Apple's iAd less significant, rather than greater. 

On top of that, Apple's iAd didn't set out to gain market share in mobile ads. Instead, it was designed to give Apple's iOS developers an option for presenting less obtrusive ads in order to fund their work. It's debatable whether iAd is any more effective at monetizing apps than other ad networks, but it simply isn't controversial that iAd only works on iOS by design. 

Without any iAd support for Android, where most apps rely exclusively on advertising for their funding, it's actually more surprising that Apple's internal ad network has kept growing alongside other mobile ad networks that target all mobile platforms, and actually kept itself ahead of three of the top five who do. 

The failure of Google's search-based advertising in mobile

What IDC's figures really highlight, however, is that in the mobile world successful companies are finding their own advertising. This is a marked change from the web, where old media has struggled to monetize itself and Google took the lead in harvesting ad revenue from users of its services, primarily through paid placement ads presented in search results.

The fact that the web and mobile markets are vastly different was highlighted by Apple's Steve Jobs when he introduced iAd in 2010 as a solution to the problem that "mobile advertising really sucks." 

Jobs didn't say iAd would earn lots of money; he said it would improve users' experience and help developers fund the development of new apps. At the release of iAd, Jobs said Apple's App Store had 185,000 apps. Today, the iOS platform has more than 775,000. 

"When you look at a mobile phone, it’s not like the desktop," Jobs said. "On the desktop, search is where it’s at. That’s where the money is. But on a mobile device search hasn’t happened. Search is not where it’s at! People aren’t searching on a mobile device like they are on a desktop.

"What’s happening is that they’re spending all their time in apps. When people are looking for a place they want to go out to dinner they’re not searching. They’re going into Yelp. They’re using apps to get the data on the internet rather than a generalized search. And this is where the opportunity to deliver advertising is. Not as part of search but as part of apps."

Apple earns three quarters of mobile software revenues and mobile hardware profits

The fact that mobile software revenues are coming from apps rather than search has worked out really well for Apple, which had focused on creating the best market for mobile apps rather than seeking to control the market for ad related revenue. Google's core competency of search result paid placement ads simply hasn't translated to mobile.

Apple reinvests most of its iTunes and its App Store profits back into those businesses, rather than using them as cash cows. However, the company still captured 74 percent of app revenue in the most recent quarter, despite "only" servicing iOS users and running its app business at break even.

More importantly, Apple makes the majority of its revenues from hardware. The iPhone accounted for around $30 billion of Apple's revenue last year, more than 120 times larger than Google's mobile display ad business (or Facebook's) and more than 240 times more important to the company than its iAd program.

In vocally predicting just a year ago that iAd would "fade in into the background," IDC failed to identify the real trend it stumbled upon this year: that mobile ad networks in general would see their share of mobile ad revenues essentially cut in half across the board by apps that get ad dollars on their own, even as growth in the overall market for mobile display ads has slowed. 

The much talked about market for mobile ads is actually a tiny sliver compared to revenues and profitability on the hardware side, where Apple also owns around 73 percent of the entire industry's profits.

US DEA upset it can't break Apple's iMessage encryption

Custom Search

Officials with the U.S. Drug Enforcement Administration are reportedly frustrated that they cannot crack Apple's iMessage encryption to listen in on suspects.

A DEA intelligence note warns of the difficulties of intercepting Apple iMessages. Source: CNet.

Apple's apparent stymying of the DEA was revealed in a government intelligence note obtained by CNet, which calls it "impossible" to intercept iMessages, even with a warrant. The note is entitled "Apple's iMessages: A Challenge for DEA Intercept."

The DEA is apparently only stopped if the message is an iMessage encrypted by Apple. If the message is instead sent as a text message, it's easier for the agency to obtain, though the DEA did admit that it "seems to be more successful if the intercept is placed on the non-Apple device."

The security of Apple's iOS platform vs. competing mobile operating systems like Google Android is frequently touted as a key advantage for the iPhone. The FBI's Internet Crime Complaint Center evenissued a warning to users last year regarding malware that targets Android devices.

iMessages are encrypted messages that can be sent between Apple devices, including iPhones, iPads and even Macs running the OS X platform. The service launched with iOS 5 in 2011, and Apple publicly revealed that all sent and received iMessages would be securely encrypted.

DEA officials first discovered that iMessages could be a hinderance to their efforts when a real-time electronic surveillance under the Federal Wiretap Act failed to yield all of a target's text messages. The agency then discovered that the person was using iMessage, which bypassed the text messaging services of carrier Verizon.

Apple revealed in January that it sees 2 billion iMessages sent each day from a half-billion iOS devices, plus Mac computers, which gained iMessage support last year. iMessage accounts allow users to send and receive their secure messages across all their Apple devices.

Obama budget to offer program cuts, seek deficit deal: official

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By Mark Felsenthal

WASHINGTON (Reuters) - President Barack Obama will offer cuts to Social Security and otherentitlement programs in a budget proposal aimed at swaying Republicans to compromise on a deficit-reduction deal, a senior administration official said on Friday.

Under a proposal that would cut the deficit by $1.8 trillion over 10 years, the president will offer to apply a less generous measure of inflation to calculate cost-of-living increases, the official said on condition of anonymity. That change would result in lower payments to some beneficiaries of theSocial Security program for retirees and is staunchly opposed by many congressional Democrats as well as labor and retiree groups.

Obama would agree to cuts to other so-called entitlement programs, the official said.

However, the president will only accept these spending cuts if congressional Republicans, for their part, agree to higher taxes, the official added. The president's budget proposal is due to be laid out in full on Wednesday.

The president's renewed offer of fiscal negotiations with congressional Republicans follows a series of bitter battles over taxes and spending that date back to 2011. Obama is eager to put the issue ofdeficit reduction behind him and move on to other priorities, which include immigration and gun control legislation.

"This isn't about political horse trading," the official said. "It's about reducing the deficit in a balanced way that economists say is best for the economy and job creation."

Still, several attempts to reach an agreement balancing spending cuts with tax increases have failed, and prospects for a deal remain doubtful. House Speaker John Boehner, who let taxes rise for the wealthiest Americans earlier this year, has said any further revenue increases are off the table.

The president also wants to undo at least some of the $85 billion in across-the-board spending cuts that went into effect last month through the process known as sequestration.

Obama's budget for the fiscal year that starts October 1 will contain a proposal to expand access to early childhood education, the official said. That program will be paid for by increases in tobacco taxes, the official added.

In addition, the president will seek to increase revenues by placing a $3 million upper limit on tax-preferred retirement accounts and by barring people from collecting disability benefits and unemployment insurance at the same time, the official said.

Analysts who have seen early drafts of the budget proposal say the president was considering cuts to Medicare through reducing payments to health care providers but also by requiring wealthier beneficiaries to pay more out of pocket.

Reductions to Social Security and Medicare benefits are highly unpopular among many of the president's strongest supporters and groups have already mobilized to oppose them.

(Reporting By Mark Felsenthal; Editing by David Brunnstrom and Susan Fenton)

Apple's iPhone 5S: Everything we know so far

An iOS 7 overhaul? A new A7 processor? A fingerprint chip? Here, a handy guide to all the iRumors

The iPhone 5 is a pristine feat of engineering — the best in its class, per more than a couple tech publications. Critics gushed about the handset's feather-light brushed-aluminum chassis, and its larger 4-inch screen to compete with bigger, crowd-pleasing Androids. Now, the annual rumor mill is once again beginning to churn, and speculation naturally turns to this question: What will the next iPhone look like?

If history is any indication, we already have our answer: It'll probably look a lot like the iPhone 5. Here's what we know so far:

1. It might debut this summer
The latest reports claim Apple has already started production of the iPhone 5S. Previous versions of the iPhone were typically unveiled in the fall, but Apple could be looking to unwrap the 5S during the dog days of summer. According to MacRumors, analyst Ming-Chi Kuo of KGI Securities — who boasts a pretty solid track record with this kind of stuff — says he expects Apple to debut the new iPhone in July. Such an effort would "avoid repeating the fatal mistake" made last year with the delayed iPhone 5 launch, "which gave competitors room to grab market share." Did someone saySamsung Galaxy?

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2. More horsepowerThis is a no-brainer, but according to Kuo's sources, the iPhone 5S will include some incremental spec bumps, most notably a new quad-core A7 processor. Here's the full rundown of the purported specs:

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3. 'Smart Flash'
The camera on the iPhone 5 has received excellent marks from reviewers, but Kuo insists the iPhone 5S will support a new feature called "Smart Flash." Essentially, the camera will automatically decide whether to use a white or yellow flash depending on lighting.

4. A new fingerprint chip
Nary a day goes by without a hacking story (Evernote being the most recent victim), and Apple could shore up the iPhone's defenses by potentially scrapping the four-number login. According to Kuo, the iPhone 5S will come sporting a first-of-its kind "fingerprint chip under the Home button, improving security and usability." Remember: Last July Apple bought AuthenTec, a security firm specializing in fingerprint-based technology.

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5. The 5S could have a little siblingRumors have long persisted of a more affordable iPhone built from lower-cost parts like a polycarbonate shell. Tim Cook insists that Apple will never make a "cheap" product, and Apple already sells older models at steep discounts. Still, everyone from The Wall Street Journal toDigiTimes reports that a more affordable iPhone is likely on the way, mostly to help the company gain some much-needed traction in emerging markets. Kuo claims that when the curtains rise for the iPhone 5S this summer, we shouldn't expect it to shine alone.

6. It probably won't support wireless charging
Wireless charging technology has been around for a few years now. According to Taiwanese tech siteDigiTimes — which, let's remember, has a spotty record when it comes to iPhone rumors — Samsung and Apple's phones may soon be due for a wireless-charging upgrade. 9to5 Mac, however, says we shouldn't count on it, at least for 2013. While Apple has already filed several patents for magnetic inductive charging technology, senior vice president Phil Schiller recently downplayed the idea, admitting that the tech isn't at a point yet where it adds any notable convenience. "Having to create another device you have to plug into the wall is actually, for most situations, more complicated," said Schiller. In other words, don't get your hopes up.

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7. iOS 7 will get a major redesign
iOS lead Scott Forstall was given the boot in December, so Apple's chief designer Jony Ive will get his first chance to revise the mobile operating system his way, i.e. less tacky software design (orskeumorphism), and a more stripped-down UI. According to iMore's Rene Ritchie, "Ive's work is apparently making many people really happy, but will also apparently make rich-texture-loving designers sad." Daring Fireball's John Gruber adds that "iOS 7 is running behind," but word on the street is that engineers are already street-testing it with "some sort of polarizing filter on their iPhone displays, such that it greatly decreases viewing angles, thus making it difficult for observers to see the apparently rather significant system-wide UI overhaul."