Danny Puff

By Malathi Nayak

SAN FRANCISCO (Reuters) - Microsoft Corp will unveil its much-anticipated next-generation Xbox on May 21 following months of speculation the company is gearing up to announce a new video game console this summer.

The company sent out media invitations on Wednesday, hinting it would be announcing the successor to its seven-year old Xbox 360. A new console from the software company will come on the heels of rival Sony's announcement in February that it will launch the PlayStation4 this holiday season.

Microsoft's May event will be held at its Xbox campus in Redmond, Washington, just a month before the Electronic Entertainment Expo (E3) in Los Angeles, the gaming industry's largest annual convention, where next-generation consoles will be spotlighted.

"On May 21, we'll mark the beginning of a new generation of games, TV and entertainment," the company said on its official blog.

The Xbox 360 is the market-leading console that has an installed user base of 76 million. Gaming blogs have been afire with speculation about what features a next-generation console might offer, but Microsoft has been tight-lipped so far.

The current version of the Xbox sports voice- and gesture-command capabilities.

Shares in Microsoft were up 3.1 percent at $31.53 in the afternoon.

(Reporting By Malathi Nayak; Editing by Kenneth Barry)

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By Elaine Porterfield

SEATTLE (Reuters) - Seattle's interim police chief has apologized for appearing in a 1986 video that showed him and other officers mocking the homeless in what the city's police department this week called an "ugly piece" of its history.

Interim Chief Jim Pugel, who is implementing sweeping reforms in the wake of a 2012 U.S. Department of Justice report that found the city's police routinely used excessive force, appeared in the video when he was a 26-year-old officer.

In the roughly five-minute clip, which officials say was part of a training video and which they released this week, Pugel and a few colleagues are seen wearing fake beards, dancing with bottles of alcohol under a freeway overpass and singing parody lyrics to the 1964 song "Under the Boardwalk" by The Drifters.

Some of the officers sport blacked-out teeth as they croon lyrics such as, "We'll be drinking Thunderbird (wine) all through the day, under the viaduct. Who could ask for anything more?"

"Even by 1980s standards, the Seattle Police Department considered the video to be insensitive and inappropriate," Pugel, who was appointed to his position earlier this month, said in a statement late on Thursday. "I regret my participation and have professionally apologized for my role in it. I do so now publicly. I am truly sorry."

He takes over a department that has at times experienced a troubled history with minority communities and is in the first year of a reform plan overseen by the U.S. Department of Justice to revise the use of force by officers.

The Seattle Times reported in a story posted on its website on Friday that the newspaper and other media outlets had received several tips about the video's existence before it was made public late on Thursday by police.

Seattle police spokesman Sean Whitcomb said Pugel, who has not said whether he will seek to lead the department on a permanent basis, disclosed the existence of the video to other city officials and homeless groups when he was appointed interim chief.

"It's not a problem but an opportunity to showcase who Chief Pugel is," Whitcomb said. "For him it was a leadership moment."

Police say all existing copies of the video have been destroyed, except for a single copy retained for their records.

Pugel said in his statement that he had the video released because he felt it was "important to show where this department has been and where it is going" and that he discussed it with Mayor Mike McGinn and several Seattle-based homeless groups.

(Writing by Alex Dobuzinskis; Editing by Paul Simao)

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LOS ANGELES (Reuters) - Oscar-winning actress Gwyneth Paltrow on Wednesday was named the world's most beautiful woman for 2013 by People magazine, knocking pop singer Beyonce out of the top spot.

The 40-year-old mother of two credits a five-day-a-week exercise regimen for keeping her in shape as she grows older.

"It makes me look younger and feel strong," Paltrow told the magazine. "When I first started, I thought, 'I'll never be good at this. This is a nightmare!' But now it's like brushing my teeth, I just do it."

It is the fourth time Paltrow, who is married to Coldplay singer Chris Martin, has been named to the magazine's annual beautiful people issue, but the first time landing the coveted cover as most beautiful woman.

She joins the likes of fellow actresses Jennifer Lopez, Julia Roberts, Halle Berry and Jennifer Aniston to top the list.

Paltrow reprises her starring role as Pepper Potts in the action film "Iron Man 3," which opens next month.

The actress has cut back her film work after giving birth to children Apple, 8, and Moses, 7, and released her second cookbook, "It's All Good," this month.

She is also the founder of lifestyle and clothing website Goop.com.

Paltrow won an Oscar for her role as William Shakespeare's muse in the 1998 film "Shakespeare in Love."

The full list of People's "World's Most Beautiful People" can be found on www.people.com/mostbeautiful

(Reporting by Eric Kelsey; Editing by Sandra Maler)

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By Gerry Shih

SAN FRANCISCO (Reuters) - Zynga Inc said on Wednesday the number of people playing its online games dropped dramatically in the first quarter, a development that overshadowed better-than-expected revenues and sent its stock tumbling in after-hours trade.

Shares fell 10 percent to $2.99 in extended trading.

The San Francisco-based publisher behind games like "FarmVille" and "Words With Friends" said its number of monthly players continued its decline to 253 million, the lowest figure since the number peaked at 331 million at the end of the third quarter of 2012.

On an adjusted basis, Zynga reported earnings of 1 cent per share, beating analyst expectations of a loss of 4 cents per share. But the company also projected that its second-quarter loss would be between 3 to 5 cents per share, exceeding the 1 cent per share loss analysts had expected.

"The second quarter guidance is light," said Sterne Agee analyst Arvind Bhatia. "We continue to think that any hope for real growth for this nebulous company really depends on what it can do in real-money gaming."

Zynga has struggled to keep users, who once flocked to its games on Facebook Inc's website. In recent months, Zynga and Facebook have revised their business partnership, as Zynga has sought to establish itself as a more independent gaming network at the risk of receiving less visitor traffic from Facebook.

Zynga has promised investors that it could tap into a potentially lucrative new revenue stream by launching real-money casino games around the world.

The company reported revenues of $263.6 million, down 18 percent from the year-ago quarter but above Wall Street's depressed expectations as the online game maker wrung more sales than expected out of its shrinking user base.

Zynga's quarterly bookings of $229.8 million also topped estimates but represented a 30 percent decline from a year ago.

(Reporting By Gerry Shih; Editing by Leslie Adler and David Gregorio)

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NEW YORK (AP) Zynga Inc.'s surprise profit in the first three months of the year got overshadowed by a revenue decline, a drop in the number of users and a lower-than-expected second-quarter forecast.

The online game maker's stock fell more than 10 percent in extended trading Wednesday after the first-quarter results came out.

Zynga, which makes "FarmVille" and other games, said Wednesday that it earned $4.1 million, which was breakeven per share. A year earlier, it lost $85.4 million, or 12 cents per share. Adjusted earnings were 1 cent per share in the latest quarter, compared with expectations for a loss of 3 cents.

Revenue fell 18 percent to $263.6 million, from $321 million.

Analysts, on average, had expected revenue of $264.5 million, according to FactSet.

As demand for its Facebook games fades, Zynga has cut jobs, closed game studios and shut down games to reduce expenses and focus only on popular titles. The quarter's expenses fell 34 percent to $268.5 million, from $406.6 million.

The number of people who play Zynga games at least once a month fell 13 percent to 253 million, from 292 million a year earlier. The number of daily players dropped 21 percent to 52 million, from 65 million.

CEO Mark Pincus said in a statement that 2013 will "continue to be a transition year." Zynga, whose games are played mainly on Facebook's website, is working on shifting to mobile games and to its own site off of Facebook.

For the current quarter, Zynga is forecasting an adjusted loss of 3 cents to 4 cents per share on revenue of $225 million to $235 million. Analysts were expecting a loss of 1 cent per share on revenue of $258.1 million.

Shares of San Francisco-based Zynga fell 34 cents, or 10.1 percent, to $3.01 in after-hours trading. The stock had closed up 17 cents, or 5.3 percent, at $3.35 before the results came out.

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TORONTO (Reuters) - BlackBerry said on Wednesday it plans to fill one of the biggest gaps in the app line-up on its new BlackBerry 10 devices with a long-awaited Skype application.

Skype, which was acquired by Microsoft Corp in 2011, allows its users to communicate via voice, video or chat over the Internet, by-passing traditional telephone networks. The service has hundreds of millions of users across the globe.

The announcement comes a day after BlackBerry said its new Q10 smartphone will be available in Canada on May 1, and in the United States before the end of May. The Q10, which comes with the physical keyboard that many of BlackBerry's core fan base cherish, is the second device to be powered by the company's new BB10 operating system.

Skype will be available on the Q10 on launch day. Users of the existing Z10 touchscreen device will have to wait a few weeks more to get Skype, after a software upgrade on the operating system, BlackBerry said.

A smaller app base than Apple's iOS and Google Inc's Android platforms has been one of the biggest criticisms of the new BlackBerry system. It has yet to offer some big-name apps like Netflix and Instagram.

(Reporting by Euan Rocha; Editing by Bernard Orr)

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SAN FRANCISCO (Reuters) - Amazon.com Inc will release a set-top TV box later this year that will stream video over the Internet, challenging Apple Inc's Apple TV device and a similar gadget sold by start-up Roku, BloombergBusinessweek reported on Wednesday.

The box will plug into TVs and give viewers access to Amazon's digital video content, which the company has been expanding, BloombergBusinessweek said, citing three unidentified people familiar with the project.

An Amazon spokeswoman declined to comment.

Amazon's video content is already available on other devices, including Roku, Microsoft Corp's Xbox and Sony Corp's PlayStation 3. However, it is not available on Apple TV.

Having its own gadget will help Amazon put its content more directly in front of consumers and give developers another reason to create apps for Amazon's digital platform, BloombergBusinessweek said.

"Amazon has a good content distribution strategy but not a great one," said Ron Josey, an analyst at JMP Securities. "Doing their own box maybe them admitting that it's a little bit harder to get embedded in all these different devices and platforms."

Amazon has been investing heavily in licensing, distributing and even creating its own digital content such as video, music, apps and games. The company has focused on getting that content on as many devices as possible, rather than building a lot of its own hardware.

However, the company has designed its own gadgets in situations where it believes it can bring a different approach to a market. When it launched its Kindle Fire tablet computer in 2011, for instance, the device's screen was 7 inches which at that time was not a popular size.

JMP's Josey, who said he was not privy to any Amazon plans in this area, speculated on Wednesday that any Amazon set-box device could include the ability to stream music, play games, access other apps and even shop through TVs, rather than just watch videos.

The set-top box is being developed by Amazon's Lab126 division, based in Cupertino, California, near Apple's headquarters. It's being run by Malachy Moynihan, a former vice president of emerging video products at Cisco Systems Inc, BloombergBusinessweek added.

BloombergBusinessweek also said that while Netflix Inc's video streaming service will likely be available on Amazon's TV box, Amazon's own video and music services will be more prominently integrated.

A Netflix spokesman declined to comment.

(Reporting by Alistair Barr; Editing by Carol Bishopric)

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LONDON (AP) The director of award-winning film "Senna" is making a documentary about the late soul singer Amy Winehouse.

Focus Features International says the movie will feature unseen archive footage to tell the story of the art and life of the musician, who died at age 27 in London in 2011 from accidental alcohol poisoning.

The Winehouse family said in a statement Thursday that it had been approached with many documentary proposals, but "Senna" director Asif Kapadia and producer James Gay-Rees presented a vision that would "look at Amy's story sensitively, honestly and without sensationalizing her."

"Senna," the acclaimed 2010 film, focused on the life of Brazilian F1 driver Ayrton Senna. The champion racer was killed in an accident in 1994.

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By Martyn Herman

LONDON (Reuters) - Liverpool striker Luis Suarez was handed a 10-match suspension by the Football Association (FA) on Wednesday following his bite on Chelsea defender Branislav Ivanovic at the weekend.

Suarez accepted a charge of violent conduct after the incident in the 2-2 Premier League draw at Anfield on Sunday but disputed the FA view that it merited more than a three-game ban.

An Independent Regulatory Commission met in London on Wednesday to decide the Uruguayan international's fate and added seven games to the usual ban for violent conduct.

The suspension begins immediately, meaning Liverpool's leading scorer will miss his side's last four games of the season and the first six at the beginning of next term.

Liverpool, who expressed their shock at the Commission's decision, have until Friday (1100 GMT) to appeal.

"Both the club and player are shocked and disappointed at the severity of today's Independent Regulatory Commission decision," Liverpool managing director Ian Ayre said in a statement on the club's website (www.liverpoolfc.com).

"We await the written reasons tomorrow (Thursday) before making any further comment."

Suarez's bite on Ivanovic's arm at Anfield was missed by referee Kevin Friend but television replays showed him sinking his teeth into the Serbian.

WIDELY CONDEMNED

The 26-year-old Suarez, who was banned for biting an opponent while with Dutch club Ajax before joining Liverpool in 2011, apologized after the game and was fined a reported 200,000 pounds ($305,700) by the club.

However, he was widely condemned for his behavior with some reports suggesting he was in danger of being sacked by the club, although Liverpool said this week that they wanted the Uruguayan to see out his four-year contract.

The FA said a three-match ban was "clearly insufficient" for the serious nature of the offence.

There was widespread support for the length of the punishment imposed with former Liverpool player Graeme Souness telling Sky Sports News: "I think 10 games is about right.

"What he did on Sunday is something I've never seen in a game anywhere before."

Former Liverpool midfielder Jamie Redknapp agreed.

"I think you have to accept that the crime that he committed probably warranted a 10-game ban," he said.

"It was an awful act of brutality really what he did and now he won't play for such a long time - it's is going to hit him where it hurts because he wants to play football."

Professional Footballers' Association (PFA) chief executive Gordon Taylor said the length of the sanction sent out a "strong message" but that it was important that the player received counseling to make sure it did not happen again.

Not everyone backed the FA's decision.

"Players who break peoples' legs, who do horrible tackles, get a three-game ban," former Liverpool striker John Aldridge told Sky Sports News.

"It's inconsistent. For me, it's not right, it's over the top."

Controversy has followed Suarez since he joined Liverpool, with his antics often overshadowing his impact on the pitch.

He served an eight-match ban for racially abusing Manchester United's Patrice Evra last season and later angered United manager Alex Ferguson by failing to shake the French defender's hand before their league match in February last year.

He has also been regularly accused of diving to win penalties and free kicks, while in an FA Cup tie this season against minor league Mansfield Town he was again criticized for scoring a goal despite a blatant handball.

Until Manchester United forward Robin Van Persie's hat-trick against Aston Villa on Monday that secured the title, Suarez was leading scorer in the league with 23 goals and he is included on a six-player shortlist for PFA Player of the Year.

($1 = 0.6542 British pounds)

(Reporting by Martyn Herman and Sonia Oxley; Editing by Ed Osmond)

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By Edward Krudy and Pamela Niimi

NEW YORK (Reuters) - As if Suffolk County, home of the Hamptons and playground of the rich and famous on New York's Long Island, didn't have enough financial problems already.

A regulatory filing on behalf of the county dated April 16 shows it accidentally missed an interest payment on some of its debt, including $76.1 million of public improvement bonds, putting the county technically in default. Oops.

The county is wealthy with income per capita well above the national average but it has run into difficulty recently, declaring a fiscal emergency last year after an independent task force predicted a three-year deficit of $530 million.

The county could have a budget shortfall of as much as $250 million by the end of next year, local officials said last month.

The error is more of an embarrassing glitch than anything else. The missed payment - just $722.65 - would be small change for many of the county's residents.

That will buy you fewer than 20 butter-poached lobster rolls (not the most expensive thing on the menu) at Dave's Grill in Montauk, a quaint fishing village on the island's northern tip, or just 10 bottles of Merry Edwards Sauvignon Blanc Russian River 2009 at La Plage in Wading River. A mere picnic.

The mistake was pointed out by the Depository Trust Company, a clearing firm, the day after it was missed and the filing says the error was the fault of the county's escrow agent, M&T Bank.

"The county informed M&T of its error and the escrow agent immediately wired the $722.65 payment to DTC," the regulatory filing said.

So what went wrong? The county was making the first payment in a complicated arrangement that uses $17 million in state HEAL grants for medical costs, primarily related to the Foley Nursing home, said Richard Tortora, president of Capital Markets Advisors, the county's financial adviser.

The $722.65, part of a debt payment of over $1 million, was the portion of the payment from the HEAL grants. The $17 million is being held in an escrow account at M&T.

"M&T for reasons we can't fathom just blew it: 'Oops it wasn't in our system, we missed it'", said Tortora, president of Capital Markets Advisors. Tortora said missing the payment and having to make a regulatory filing with the Municipal Securities Rulemaking Board was frustrating after months spent putting the arrangement together for the county.

M&T Bank was not immediately available for comment.

Fitch Ratings, the credit ratings agency, downgraded Suffolk County's general obligation bond rating to A from A-plus last month, affecting about $1.4 billion of debt. General obligation bonds have the full faith and credit of the issuer and are the best gauge of how risky investors think the county is.

Fitch said it had concerns about the county's ability to become financially stable, let alone reduce its big deficit.

(This story was corrected to fix name of Suffolk County's financial advisers)

(Reporting by Edward Krudy, additional reporting by Pam Niimi; Editing by Kenneth Barry)

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