Barack Obama
44th President of the United States
Incumbent
Assumed office  January 20, 2009
Vice President	Joe Biden
Preceded by	George W. Bush
United States Senator from Illinois
In office January 3, 2005 – November 16, 2008
Preceded by	Peter Fitzgerald
Succeeded by	Roland Burris
Member of the Illinois Senate from the 13th district
In office January 8, 1997 – November 4, 2004
Preceded by	Alice Palmer
Succeeded by	Kwame Raoul
Born	August 4, 1961 (1961-08-04) (age 49)[1] Honolulu, Hawaii[2]
Political party	Democratic Party
Spouse(s)	Michelle Robinson Obama
Children	Malia Sasha
Residence	White House (official) Chicago, Illinois (private)
Alma mater	Occidental College Columbia University Harvard University
Profession	Community organizer Lawyer Constitutional law professor Author
Religion	Christianity[3]
Signature
Website	The White House Barack Obama
This article is part of a series on Barack Obama Background  · Illinois Senate  · U.S. Senate · Political positions · Public image · Family · 2008 primaries · Obama–Biden campaign · Transition · Inauguration · Electoral history · Presidency (Timeline ’09, ’10, First 100 days)  · Nobel Peace Prize more…

Barack Hussein Obama II (ⁱ /bəˈrɑːk huːˈseɪn oʊˈbɑːmə/; born August 4, 1961) is the 44th and current President of the United States. He is the first African American to hold the office. Obama previously served as a United States Senator from Illinois, from January 2005 until he resigned after his election to the presidency in November 2008.

A native of Honolulu, Hawaii, Obama is a graduate of Columbia University and Harvard Law School, where he was the president of the Harvard Law Review. He was a community organizer in Chicago before earning his law degree. He worked as a civil rights attorney in Chicago and taught constitutional law at the University of Chicago Law School from 1992 to 2004.

Obama served three terms in the Illinois Senate from 1997 to 2004. Following an unsuccessful bid against a Democratic incumbent for a seat in the U.S. House of Representatives in 2000, he ran for United States Senate in 2004.^[4] Several events brought him to national attention during the campaign, including his victory in the March 2004 Democratic primary and his keynote address at the Democratic National Convention in July 2004. He won election to the U.S. Senate in November 2004. His presidential campaign began in February 2007, and after a close campaign in the 2008 Democratic Party presidential primaries against Hillary Rodham Clinton, he won his party’s nomination. In the 2008 general election, he defeated Republican nominee John McCain and was inaugurated as president on January 20, 2009.

As president, Obama signed economic stimulus legislation in the form of the American Recovery and Reinvestment Act in February 2009 and the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 in December 2010. Other domestic policy initiatives include the Patient Protection and Affordable Care Act, the Dodd–Frank Wall Street Reform and Consumer Protection Act and the Don’t Ask, Don’t Tell Repeal Act of 2010. In foreign policy, Obama gradually withdrew combat troops from Iraq, increased troop levels in Afghanistan, and signed an arms control treaty with Russia. In October 2009, Obama was named the 2009 Nobel Peace Prize laureate.

Early life and career

Obama was born on August 4, 1961, at Kapi’olani Maternity & Gynecological Hospital (now called Kapi’olani Medical Center for Women & Children) in Honolulu, Hawaii.^[5][6][7] His mother, Stanley Ann Dunham, was born in Wichita, Kansas. Of mostly English descent, her family also traces to Germany and Ireland.^{[8][9][10][11]} His great-great-great grandfather was born in County Offaly.^[12] His father, Barack Obama, Sr., was a Luo from Nyang’oma Kogelo, Nyanza Province, Kenya. Obama is the first President to have been born in Hawaii.^[13][14] Obama’s parents met in 1960 in a Russian language class at the University of Hawaii at Mānoa, where his father was a foreign student on scholarship.^[15][16] The couple married on February 2, 1961,^[17] but separated when Obama Sr. went to Harvard University on scholarship, and divorced in 1964.^[16] Obama Sr. remarried and returned to Kenya, visiting Barack in Hawaii only once, in 1971. He died in an automobile accident in 1982.^[18]

After her divorce, Dunham married Indonesian student Lolo Soetoro, who was attending college in Hawaii. When Suharto, a military leader in Soetoro’s home country, came to power in 1967, all Indonesian students studying abroad were recalled, and the family moved to the Menteng neighborhood of Jakarta.^[19][20] From ages six to ten, Obama attended local schools in Jakarta, including Besuki Public School and St. Francis of Assisi School.^[21][22]

In 1971, Obama returned to Honolulu to live with his maternal grandparents, Madelyn and Stanley Armour Dunham, and attended Punahou School, a private college preparatory school, from the fifth grade until his graduation from high school in 1979.^[23] Obama’s mother returned to Hawaii in 1972, remaining there until 1977 when she went back to Indonesia to work as an anthropological field worker. She finally returned to Hawaii in 1994 and lived there for one year, before dying of ovarian cancer.^[24]

Barack Obama and half-sister Maya Soetoro-Ng, with their mother Ann Dunham and grandfather Stanley Dunham, in Hawaii (early 1970s)

Of his early childhood, Obama recalled, “That my father looked nothing like the people around me—that he was black as pitch, my mother white as milk—barely registered in my mind.”^[25] He described his struggles as a young adult to reconcile social perceptions of his multiracial heritage.^[26] Reflecting later on his formative years in Honolulu, Obama wrote: “The opportunity that Hawaii offered—to experience a variety of cultures in a climate of mutual respect—became an integral part of my world view, and a basis for the values that I hold most dear.”^[27] Obama has also written and talked about using alcohol, marijuana and cocaine during his teenage years to “push questions of who I was out of my mind.”^[28] At the 2008 Civil Forum on the Presidency, Obama identified his high-school drug use as a great moral failure.^[29]

Following high school, Obama moved to Los Angeles in 1979 to attend Occidental College.^[30] In February 1981, he made his first public speech, calling for Occidental’s divestment from South Africa.^[30] In mid-1981, Obama traveled to Indonesia to visit his mother and sister Maya, and visited the families of college friends in India and Pakistan for three weeks.^[30]

Later in 1981 he transferred to Columbia University in New York City, where he majored in political science with a specialty in international relations^[31] and graduated with a B.A. in 1983. He worked for a year at the Business International Corporation,^[32][33] then at the New York Public Interest Research Group.^[34][35]

Chicago community organizer and Harvard Law School

After four years in New York City, Obama was hired in Chicago as director of the Developing Communities Project (DCP), a church-based community organization originally comprising eight Catholic parishes in Greater Roseland (Roseland, West Pullman and Riverdale) on Chicago’s far South Side. He worked there as a community organizer from June 1985 to May 1988.^[34][36] During his three years as the DCP’s director, its staff grew from one to thirteen and its annual budget grew from US$70,000 ($142,911 in 2011) to US$400,000 ($742,647 in 2011). He helped set up a job training program, a college preparatory tutoring program, and a tenants’ rights organization in Altgeld Gardens.^[37] Obama also worked as a consultant and instructor for the Gamaliel Foundation, a community organizing institute.^[38] In mid-1988, he traveled for the first time in Europe for three weeks and then for five weeks in Kenya, where he met many of his paternal relatives for the first time.^[39] He returned in August 2006 for a visit to his father’s birthplace, a village near Kisumu in rural western Kenya.^[40]

In late 1988, Obama entered Harvard Law School. He was selected as an editor of the Harvard Law Review at the end of his first year,^[41] and president of the journal in his second year.^[42] During his summers, he returned to Chicago, where he worked as a summer associate at the law firms of Sidley Austin in 1989 and Hopkins & Sutter in 1990.^[43] After graduating with a Juris Doctor (J.D.) magna cum laude^[44] from Harvard in 1991, he returned to Chicago.^[41] Obama’s election as the first black president of the Harvard Law Review gained national media attention^[42] and led to a publishing contract and advance for a book about race relations,^[45] which evolved into a personal memoir. The manuscript was published in mid-1995 as Dreams from My Father.^[45]

University of Chicago Law School and civil rights attorney

In 1991, Obama accepted a two-year position as Visiting Law and Government Fellow at the University of Chicago Law School to work on his first book.^[46] He then served as a professor at the University of Chicago Law School for twelve years—as a Lecturer from 1992 to 1996, and as a Senior Lecturer from 1996 to 2004—teaching constitutional law.^[47]

From April to October 1992, Obama directed Illinois’s Project Vote, a voter registration drive with ten staffers and seven hundred volunteer registrars; it achieved its goal of registering 150,000 of 400,000 unregistered African Americans in the state, and led to Crain’s Chicago Business naming Obama to its 1993 list of “40 under Forty” powers to be.^[48] In 1993 he joined Davis, Miner, Barnhill & Galland, a 13-attorney law firm specializing in civil rights litigation and neighborhood economic development, where he was an associate for three years from 1993 to 1996, then of counsel from 1996 to 2004, with his law license becoming inactive in 2002.^[49]

From 1994 to 2002, Obama served on the boards of directors of the Woods Fund of Chicago, which in 1985 had been the first foundation to fund the Developing Communities Project, and of the Joyce Foundation.^[34] He served on the board of directors of the Chicago Annenberg Challenge from 1995 to 2002, as founding president and chairman of the board of directors from 1995 to 1999.^[34]

Legislative career: 1997–2008

State Senator: 1997–2004

Obama was elected to the Illinois Senate in 1996, succeeding State Senator Alice Palmer as Senator from Illinois’s 13th District, which at that time spanned Chicago South Side neighborhoods from Hyde Park – Kenwood south to South Shore and west to Chicago Lawn.^[50] Once elected, Obama gained bipartisan support for legislation reforming ethics and health care laws.^[51] He sponsored a law increasing tax credits for low-income workers, negotiated welfare reform, and promoted increased subsidies for childcare.^[52] In 2001, as co-chairman of the bipartisan Joint Committee on Administrative Rules, Obama supported Republican Governor Ryan’s payday loan regulations and predatory mortgage lending regulations aimed at averting home foreclosures.^[53]

Obama was reelected to the Illinois Senate in 1998, defeating Republican Yesse Yehudah in the general election, and was reelected again in 2002.^[54] In 2000, he lost a Democratic primary run for the U.S. House of Representatives to four-term incumbent Bobby Rush by a margin of two to one.^[55]

In January 2003, Obama became chairman of the Illinois Senate’s Health and Human Services Committee when Democrats, after a decade in the minority, regained a majority.^[56] He sponsored and led unanimous, bipartisan passage of legislation to monitor racial profiling by requiring police to record the race of drivers they detained, and legislation making Illinois the first state to mandate videotaping of homicide interrogations.^[52][57] During his 2004 general election campaign for U.S. Senate, police representatives credited Obama for his active engagement with police organizations in enacting death penalty reforms.^[58] Obama resigned from the Illinois Senate in November 2004 following his election to the U.S. Senate.^[59]

U.S. Senate campaign

In May 2002, Obama commissioned a poll to assess his prospects in a 2004 U.S. Senate race; he created a campaign committee, began raising funds and lined up political media consultant David Axelrod by August 2002, and formally announced his candidacy in January 2003.^[60]

Obama was an early opponent of the George W. Bush administration’s 2003 invasion of Iraq.^[61] On October 2, 2002, the day President Bush and Congress agreed on the joint resolution authorizing the Iraq War,^[62] Obama addressed the first high-profile Chicago anti-Iraq War rally,^[63] and spoke out against the war.^[64] He addressed another anti-war rally in March 2003 and told the crowd that “it’s not too late” to stop the war.^[65]

County results of the 2004 race.

Decisions by Republican incumbent Peter Fitzgerald and his Democratic predecessor Carol Moseley Braun not to contest the race resulted in wide-open Democratic and Republican primary contests involving fifteen candidates.^[66] In the March 2004 primary election, Obama won in an unexpected landslide—which overnight made him a rising star within the national Democratic Party, started speculation about a presidential future, and led to the reissue of his memoir, Dreams from My Father.^[67]

In July 2004, Obama delivered the keynote address at the 2004 Democratic National Convention in Boston, Massachusetts,^[68] and it was seen by 9.1 million viewers. His speech was well received and elevated his status within the Democratic Party.^[69]

Obama’s expected opponent in the general election, Republican primary winner Jack Ryan, withdrew from the race in June 2004.^[70] Six weeks later, Alan Keyes accepted the Illinois Republican Party’s nomination to replace Ryan.^[71] In the November 2004 general election, Obama won with 70% of the vote.^[72]

U.S. Senator: 2005–2008

Obama delivering a speech at the University of Southern California, on October 28, 2006.

Obama was sworn in as a senator on January 4, 2005,^[73] at which time he became the only Senate member of the Congressional Black Caucus.^[74] CQ Weekly characterized him as a “loyal Democrat” based on analysis of all Senate votes in 2005–2007. The National Journal ranked him among the “most liberal” senators during 2005 through 2007^[75] (the ranking has been criticized by liberal groups such as Media Matters for America^[76][77]). He enjoyed high popularity as senator with a 72% approval in Illinois.^[78] Obama announced on November 13, 2008, that he would resign his Senate seat on November 16, 2008, before the start of the lame-duck session, to focus on his transition period for the presidency.^[79]

Legislation

Senate bill sponsors Tom Coburn (R-OK) and Obama discussing the Coburn–Obama Transparency Act^[80]

Obama cosponsored the Secure America and Orderly Immigration Act.^[81] He introduced two initiatives bearing his name: Lugar–Obama, which expanded the Nunn–Lugar cooperative threat reduction concept to conventional weapons,^[82] and the Coburn–Obama Transparency Act, which authorized the establishment of USAspending.gov, a web search engine on federal spending.^[83] On June 3, 2008, Senator Obama, along with Senators Tom Carper, Tom Coburn, and John McCain, introduced follow-up legislation: Strengthening Transparency and Accountability in Federal Spending Act of 2008.^[84]

Obama sponsored legislation that would have required nuclear plant owners to notify state and local authorities of radioactive leaks, but the bill failed to pass in the full Senate after being heavily modified in committee.^[85] Regarding tort reform, Obama voted for the Class Action Fairness Act of 2005 and the FISA Amendments Act of 2008, which grants immunity from civil liability to telecommunications companies complicit with NSA warrantless wiretapping operations.^[86]

Obama and U.S. Sen. Richard Lugar (R-IN) visit a Russian mobile launch missile dismantling facility in August 2005.^[87]

In December 2006, President Bush signed into law the Democratic Republic of the Congo Relief, Security, and Democracy Promotion Act, marking the first federal legislation to be enacted with Obama as its primary sponsor.^[88] In January 2007, Obama and Senator Feingold introduced a corporate jet provision to the Honest Leadership and Open Government Act, which was signed into law in September 2007.^[89] Obama also introduced Deceptive Practices and Voter Intimidation Prevention Act, a bill to criminalize deceptive practices in federal elections,^[90] and the Iraq War De-Escalation Act of 2007,^[91] neither of which has been signed into law.

Later in 2007, Obama sponsored an amendment to the Defense Authorization Act adding safeguards for personality disorder military discharges.^[92] This amendment passed the full Senate in the spring of 2008.^[93] He sponsored the Iran Sanctions Enabling Act supporting divestment of state pension funds from Iran’s oil and gas industry, which has not passed committee, and co-sponsored legislation to reduce risks of nuclear terrorism.^[94] Obama also sponsored a Senate amendment to the State Children’s Health Insurance Program providing one year of job protection for family members caring for soldiers with combat-related injuries.^[95]

Committees

Obama held assignments on the Senate Committees for Foreign Relations, Environment and Public Works and Veterans’ Affairs through December 2006.^[96] In January 2007, he left the Environment and Public Works committee and took additional assignments with Health, Education, Labor and Pensions and Homeland Security and Governmental Affairs.^[97] He also became Chairman of the Senate’s subcommittee on European Affairs.^[98] As a member of the Senate Foreign Relations Committee, Obama made official trips to Eastern Europe, the Middle East, Central Asia and Africa. He met with Mahmoud Abbas before Abbas became President of the Palestinian Authority, and gave a speech at the University of Nairobi condemning corruption within the Kenyan government.^[99]

Presidential campaign: 2008

Obama stands on stage with his wife and two daughters just before announcing his presidential candidacy in Springfield, Illinois, Feb. 10, 2007.

On February 10, 2007, Obama announced his candidacy for president of the United States in front of the Old State Capitol building in Springfield, Illinois.^{[100][101][102]} The choice of the announcement site was viewed as symbolic^[100][103] because it was also where Abraham Lincoln delivered his historic “House Divided” speech in 1858.^[102] Obama emphasized the issues of rapidly ending the Iraq War, increasing energy independence, and providing universal health care,^[104] in a campaign that projected themes of “hope” and “change”.^[105]

Obama delivers his presidential election victory speech in Chicago’s Grant Park.

A large number of candidates entered the Democratic Party presidential primaries. The field narrowed to a duel between Obama and Senator Hillary Rodham Clinton after early contests, with the race remaining close throughout the primary process but with Obama gaining a steady lead in pledged delegates due to better long-range planning, superior fundraising, dominant organizing in caucus states, and better exploitation of delegate allocation rules.^[106] Clinton ended her campaign and endorsed him on June 7, 2008.^[107]

Obama announced on August 23 that he had selected Delaware Senator Joe Biden as his vice presidential running mate,^[108] from a field speculated to include Senator Evan Bayh and Virginia Governor Tim Kaine.^[109] At the Democratic National Convention in Denver, Colorado, Hillary Clinton called for her delegates and supporters to endorse Obama, and she and Bill Clinton gave convention speeches in support of Obama.^[110] Obama delivered his acceptance speech, not at the convention center where the Democratic National Convention was held,^[111] but at Invesco Field at Mile High to a crowd of over 75,000^[112] and presented his policy goals; the speech was viewed by over 38 million people worldwide.^[113]

President George W. Bush meets with President-Elect Obama in the Oval Office on November 10, 2008.

During both the primary process and the general election, Obama’s campaign set numerous fundraising records, particularly in the quantity of small donations.^[114] On June 19, 2008, Obama became the first major-party presidential candidate to turn down public financing in the general election since the system was created in 1976.^[115]

McCain was nominated as the Republican candidate and the two engaged in three presidential debates in September and October 2008.^[116] On November 4, Obama won the presidency by winning 365 electoral votes to 173 received by McCain,^[117] capturing 52.9% of the popular vote to McCain’s 45.7%,^[118] to become the first African American^[119] to be elected president. Obama delivered his victory speech before hundreds of thousands of supporters in Chicago’s Grant Park.^[120]

Presidency

First days

The inauguration of Barack Obama as the 44th President, and Joe Biden as Vice President, took place on January 20, 2009. In his first few days in office Obama issued executive orders and presidential memoranda directing the U.S. military to develop plans to withdraw troops from Iraq,^[121] and ordered the closing of the Guantanamo Bay detention camp “as soon as practicable and no later than” January 2010.^[122] Obama also reduced the secrecy given to presidential records^[123] and changed procedures to promote disclosure under the Freedom of Information Act.^[124] The president also reversed George W. Bush’s ban on federal funding to foreign establishments that allow abortions.^[125]

Domestic policy

Barack Obama takes the oath of office as President of the United States.

The first bill signed into law by Obama was the Lilly Ledbetter Fair Pay Act of 2009, relaxing the statute of limitations for equal-pay lawsuits.^[126] Five days later, he signed the reauthorization of the State Children’s Health Insurance Program (SCHIP) to cover an additional 4 million children currently uninsured.^[127]

In March 2009, Obama reversed a Bush-era policy which had limited funding of embryonic stem cell research. Obama stated that he believed “sound science and moral values…are not inconsistent” and pledged to develop “strict guidelines” on the research.^[128]

Obama appointed two women to serve on the Supreme Court in the first two years of his Presidency. Sonia Sotomayor, nominated by Obama on May 26, 2009, to replace retiring Associate Justice David Souter, was confirmed on August 6, 2009,^[129] becoming the first Hispanic to be a Supreme Court Justice.^[130] Elena Kagan, nominated by Obama on May 10, 2010, to replace retiring Associate Justice John Paul Stevens, was confirmed on August 5, 2010, bringing the number of women sitting simultaneously on the Court to three, for the first time in American history.^[131]

On September 30, 2009, the Obama administration proposed new regulations on power plants, factories and oil refineries in an attempt to limit greenhouse gas emissions and to curb global warming.^[132][133]

On October 8, 2009, Obama signed the Matthew Shepard and James Byrd, Jr. Hate Crimes Prevention Act, a measure that expands the 1969 United States federal hate-crime law to include crimes motivated by a victim’s actual or perceived gender, sexual orientation, gender identity, or disability.^{[134][135][136]}

On March 30, 2010, Obama signed the Health Care and Education Reconciliation Act, a reconciliation bill which ends the process of the federal government giving subsidies to private banks to give out federally insured loans, increases the Pell Grant scholarship award, and makes changes to the Patient Protection and Affordable Care Act.^{[137][138][139][140]}

In a major space policy speech in April 2010, Obama announced a planned change in direction at NASA, the U.S. space agency. He ended plans for a return of manned spaceflight to the moon and ended development of the Ares I rocket, Ares V rocket and Constellation program. He is focusing funding (which is expected to rise modestly) on Earth science projects and a new rocket type, as well as research and development for an eventual manned mission to Mars. Missions to the International Space Station are expected to continue until 2020.^[141]

Economic policy

On February 17, 2009, Obama signed the American Recovery and Reinvestment Act of 2009, a $787 billion economic stimulus package aimed at helping the economy recover from the deepening worldwide recession.^[142] The act includes increased federal spending for health care, infrastructure, education, various tax breaks and incentives, and direct assistance to individuals,^[143] which is being distributed over the course of several years.

President Barack Obama signs the ARRA into law on February 17, 2009 in Denver, Colorado. Vice President Joe Biden stands behind him.

In March, Obama’s Treasury Secretary, Timothy Geithner, took further steps to manage the financial crisis, including introducing the Public-Private Investment Program for Legacy Assets, which contains provisions for buying up to $2 trillion in depreciated real estate assets.^[144]

Obama intervened in the troubled automotive industry^[145] in March 2009, renewing loans for General Motors and Chrysler to continue operations while reorganizing. Over the following months the White House set terms for both firms’ bankruptcies, including the sale of Chrysler to Italian automaker Fiat^[146] and a reorganization of GM giving the U.S. government a temporary 60% equity stake in the company, with the Canadian government shouldering a 12% stake.^[147] In June 2009, dissatisfied with the pace of economic stimulus, Obama called on his cabinet to accelerate the investment.^[148] He signed into law the Car Allowance Rebate System, known colloquially as “Cash for Clunkers”, that had mixed results.^{[149][150][151]}

Although spending and loan guarantees from the Federal Reserve and the Treasury Department authorized by the Bush and Obama administrations totaled about $11.5 trillion, only $3 trillion had actually been spent by the end of November 2009.^[152] However, Obama and the Congressional Budget Office predict that the 2010 budget deficit will be $1.5 trillion or 10.6% of the nation’s gross domestic product (GDP) compared to the 2009 deficit of $1.4 trillion or 9.9% of GDP.^[153][154] For 2011, the administration predicted the deficit will slightly shrink to $1.34, while the 10-year deficit will increase to $8.53 trillion or 80% of GDP.^[155]

Unemployment numbers rose briefly to as high as 10.1% in October 2009 (the highest since 1983)^[156] before decreasing to 9.5% in June 2010.^[157] In the first quarter of 2010, the U.S. economy expanded at a 2.7% pace^[158] after growing at its fastest rate in six years in the fourth quarter, 5.7%.^[159] In July 2010, the Federal Reserve expressed that although economic activity continued to increase, its pace had slowed and its Chairman, Ben Bernanke, stated that the economic outlook was “unusually uncertain.”^[160]

The Congressional Budget Office and a broad range of economists credit Obama’s stimulus plan for economic growth.^[161][162] The CBO released a report stating that the stimulus bill increased employment by 1–2.1 million,^{[162][163][164][165]} while conceding that “It is impossible to determine how many of the reported jobs would have existed in the absence of the stimulus package.”^[166] Although an April 2010 survey of members of the National Association for Business Economics showed an increase in job creation (over a similar January survey) for the first time in two years, 73% of the 68 respondents believed that the stimulus bill has had no impact on employment.^[167]

Within a month of the 2010 midterm elections, Obama announced a compromise deal with the Congressional Republican leadership that included a temporary, two-year extension of the 2001 and 2003 income tax rates, a one-year payroll tax reduction, continuation of unemployment benefits, and a new rate and exemption amount for estate taxes.^[168] The compromise overcome opposition from some in both parties, and the resulting $858 billion Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 passed with bipartisan majorities in both houses of Congress before Obama signed it on December 17, 2010.^[169]

Health care reform

Barack Obama signs the Patient Protection and Affordable Care Act at the White House, March 23, 2010.

Obama called for Congress to pass legislation reforming health care in the United States, a key campaign promise and a top legislative goal.^[170] He proposed an expansion of health insurance coverage to cover the uninsured, to cap premium increases, and to allow people to retain their coverage when they leave or change jobs. His proposal was to spend $900 billion over 10 years and include a government insurance plan, also known as the public option, to compete with the corporate insurance sector as a main component to lowering costs and improving quality of health care. It would also make it illegal for insurers to drop sick people or deny them coverage for pre-existing conditions, and require every American carry health coverage. The plan also includes medical spending cuts and taxes on insurance companies that offer expensive plans.^[171][172]

On July 14, 2009, House Democratic leaders introduced a 1,017-page plan for overhauling the U.S. health care system, which Obama wanted Congress to approve by the end of 2009.^[170] After much public debate during the Congressional summer recess of 2009, Obama delivered a speech to a joint session of Congress on September 9 where he addressed concerns over his administration’s proposals.^[173]

On November 7, 2009, a health care bill featuring the public option was passed in the House.^[174][175] On December 24, 2009, the Senate passed its own bill—without a public option—on a party-line vote of 60–39.^[176] On March 21, 2010, the health care bill passed by the Senate in December was passed in the House by a vote of 219 to 212.^[177] Obama signed the bill into law on March 23, 2010.^[178]

Gulf of Mexico oil spill

On April 20, 2010, an explosion destroyed an offshore drilling rig at the Macondo Prospect in the Gulf of Mexico, causing a major sustained oil leak. The well’s operator, BP, initiated a containment and cleanup plan, and began drilling two relief wells intended to stop the flow. Obama visited the Gulf on May 2 among visits by members of his cabinet, and again on May 28 and June 4. He began a federal investigation and formed a bipartisan commission to recommend new safety standards, after a review by Secretary of the Interior Ken Salazar and concurrent Congressional hearings. On May 27, he announced a 6-month moratorium on new deepwater drilling permits and leases, pending regulatory review.^[179] As multiple efforts by BP failed, some in the media and public expressed confusion and criticism over various aspects of the incident, and stated a desire for more involvement by Obama and the federal government.^{[180][181][182][183][184]}

Foreign and defense policy

President Obama in discussion with Chinese President Hu Jintao at the 2009 Pittsburgh G-20 Summit

In February and March, Vice President Joe Biden and Secretary of State Hillary Rodham Clinton made separate overseas trips to announce a “new era” in U.S. foreign relations with Russia and Europe, using the terms “break” and “reset” to signal major changes from the policies of the preceding administration.^[185] Obama’s granting of his first television interview as president to an Arabic cable network, Al Arabiya, was seen as an attempt to reach out to Arab leaders.^[186]

On March 19, Obama continued his outreach to the Muslim world, releasing a New Year’s video message to the people and government of Iran.^[187] This attempt at outreach was rebuffed by the Iranian leadership.^[188] In April, Obama gave a speech in Ankara, Turkey, which was well received by many Arab governments.^[189] On June 4, 2009, Obama delivered a speech at Cairo University in Egypt calling for “a new beginning” in relations between the Islamic world and the United States and promoting Middle East peace.^[190]

British Prime Minister David Cameron and President Barack Obama, during the 2010 G-20 Toronto summit.

On June 26, 2009, in response to the Iranian government’s actions towards protesters following Iran’s 2009 presidential election, Obama said: “The violence perpetrated against them is outrageous. We see it and we condemn it.”^[191] On July 7, while in Moscow, he responded to a Vice President Biden comment on a possible Israeli military strike on Iran by saying: “We have said directly to the Israelis that it is important to try and resolve this in an international setting in a way that does not create major conflict in the Middle East.”^[192]

On September 24, 2009, Obama became the first sitting U.S. president to preside over a meeting of the United Nations Security Council.^[193]

In March 2010, Obama took a public stance against plans by the government of Israeli Prime Minister Benjamin Netanyahu to continue building Jewish housing projects in predominantly Arab neighborhoods of East Jerusalem.^[194][195] During the same month, an agreement was reached with the administration of Russian President Dmitry Medvedev to replace the 1991 Strategic Arms Reduction Treaty with a new pact reducing the number of long-range nuclear weapons in the arsenals of both countries by about one-third.^[196] The New START treaty was signed by Obama and Medvedev in April 2010, and was ratified by the U.S. Senate in December 2010.^[197]

On December 22, 2010, Obama signed the Don’t Ask, Don’t Tell Repeal Act of 2010, a bill that provides for repeal of the Don’t ask, don’t tell policy of 1993 that has prevented gay and lesbian people from serving openly in the United States Armed Forces.^[198] Repealing “Don’t ask, don’t tell” had been a key campaign promise that Obama had made during the 2008 presidential campaign.^[199][200]

Iraq war

Obama declares the end of combat operations in Iraq.

During his presidential transition, President-elect Obama announced that he would retain the incumbent Defense Secretary, Robert Gates, in his Cabinet.^[201]

On February 27, 2009, Obama declared that combat operations would end in Iraq within 18 months. His remarks were made to a group of Marines preparing for deployment to Afghanistan. Obama said, “Let me say this as plainly as I can: By August 31, 2010, our combat mission in Iraq will end.”^[202] The Obama administration scheduled the withdrawal of combat troops to be completed by August 2010, decreasing troops levels from 142,000 while leaving a transitional force of 35,000 to 50,000 in Iraq until the end of 2011. On August 19, 2010, the last US combat brigade exited Iraq. The plan is to transition the mission of the remaining troops from combat operations to counter-terrorism and the training, equipping, and advising of Iraqi security forces.^[203][204] On August 31, 2010, Obama announced that the U.S. combat mission in Iraq was over.^[205]

War in Afghanistan

Early in his presidency, Obama moved to bolster U.S. troop strength in Afghanistan.^[206] He announced an increase to U.S. troop levels of 17,000 in February 2009 to “stabilize a deteriorating situation in Afghanistan”, an area he said had not received the “strategic attention, direction and resources it urgently requires”.^[207] He replaced the military commander in Afghanistan, General David D. McKiernan, with former Special Forces commander Lt. Gen. Stanley A. McChrystal in May 2009, indicating that McChrystal’s Special Forces experience would facilitate the use of counterinsurgency tactics in the war.^[208] On December 1, 2009, Obama announced the deployment of an additional 30,000 military personnel to Afghanistan.^[209] He also proposed to begin troop withdrawals 18 months from that date.^[210][211] McChrystal was replaced by David Petraeus in June 2010 after McChrystal’s staff criticized White House personnel in a magazine article.^[212]

2010 midterm election

Obama called the November 2, 2010 election, where the Democratic Party lost many seats in, and control of, the House of Representatives,^[213] “humbling” and a “shellacking”.^[214] He said that the results came because not enough Americans had felt the effects of the economic recovery.^[215]

Cultural and political image

President George W. Bush invited then-President-elect Barack Obama and former Presidents George H. W. Bush, Bill Clinton, and Jimmy Carter to a meeting in the Oval Office on January 7, 2009.

Obama’s family history, early life and upbringing, and Ivy League education differ markedly from those of African-American politicians who launched their careers in the 1960s through participation in the civil rights movement.^[216] Obama is also not a descendant of American slaves.^[217] Expressing puzzlement over questions about whether he is “black enough”, Obama told an August 2007 meeting of the National Association of Black Journalists that “we’re still locked in this notion that if you appeal to white folks then there must be something wrong.”^[218] Obama acknowledged his youthful image in an October 2007 campaign speech, saying: “I wouldn’t be here if, time and again, the torch had not been passed to a new generation.”^[219]

Obama is frequently referred to as an exceptional orator.^[220] During his pre-inauguration transition period and continuing into his presidency, Obama has delivered a series of weekly Internet video addresses.^[221]

Obama presents his first weekly address as President of the United States on January 24, 2009, discussing the American Recovery and Reinvestment Act of 2009.

According to the Pew Research Center, Obama’s approval ratings dropped from 64% in February, 2009 to 49% in December, a trend similar to Ronald Reagan‘s and Bill Clinton‘s first years.^[222] Polls show strong support for Obama in other countries,^[223] and before being elected President he has met with prominent foreign figures including then-British Prime Minister Tony Blair,^[224] Italy’s Democratic Party leader and then Mayor of Rome Walter Veltroni,^[225] and French President Nicolas Sarkozy.^[226]

According to a May 2009 poll conducted by Harris Interactive for France 24 and the International Herald Tribune, Obama was rated as the most popular world leader, as well as the one figure most people would pin their hopes on for pulling the world out of the economic downturn.^[227]

Obama won Best Spoken Word Album Grammy Awards for abridged audiobook versions of Dreams from My Father in February 2006 and for The Audacity of Hope in February 2008.^[228] His concession speech after the New Hampshire primary was set to music by independent artists as the music video “Yes We Can“, which was viewed by 10 million people on YouTube in its first month^[229] and received a Daytime Emmy Award.^[230] In December 2008, Time magazine named Barack Obama as its Person of the Year for his historic candidacy and election, which it described as “the steady march of seemingly impossible accomplishments”.^[231]

On October 9, 2009, the Norwegian Nobel Committee announced that Obama had won the 2009 Nobel Peace Prize “for his extraordinary efforts to strengthen international diplomacy and cooperation between peoples”.^[232] Obama accepted this award in Oslo, Norway on December 10, 2009, with “deep gratitude and great humility.”^[233] The award drew a mixture of praise and criticism from world leaders and media figures.^[234][235] Obama is the fourth U.S. president to be awarded the Nobel Peace Prize and the third to become a Nobel laureate while in office.

A 2010 Siena College poll of 238 Presidential scholars found that Obama was ranked 15th out of 43, with high ratings for imagination, communication ability and intelligence and a low rating for background (family, education and experience).^[236]

Family and personal life

Barack Obama together with his family and a costumed Easter Bunny, as they wave from the South Portico of the White House to guests attending the White House Easter Egg Roll.

In a 2006 interview, Obama highlighted the diversity of his extended family: “It’s like a little mini-United Nations”, he said. “I’ve got relatives who look like Bernie Mac, and I’ve got relatives who look like Margaret Thatcher.”^[237] Obama has seven half-siblings from his Kenyan father’s family – six of them living – and a half-sister with whom he was raised, Maya Soetoro-Ng, the daughter of his mother and her Indonesian second husband.^[238] Obama’s mother was survived by her Kansas-born mother, Madelyn Dunham,^[239] until her death on November 2, 2008,^[240] two days before his election to the Presidency. In Dreams from My Father, Obama ties his mother’s family history to possible Native American ancestors and distant relatives of Jefferson Davis, President of the Confederate States of America during the American Civil War.^[241] Obama’s great-uncle served in the 89th Division that overran Ohrdruf,^[242] the first of the Nazi concentration camps to be liberated by U.S. troops during World War II.^[243]

Obama was known as “Barry” in his youth, but asked to be addressed with his given name during his college years.^[244] Besides his native English, Obama speaks Indonesian at the conversational level, which he learned during his four childhood years in Jakarta.^[245] He plays basketball, a sport he participated in as a member of his high school’s varsity team.^[246]

Obama playing basketball with U.S. military at Camp Lemonnier, Djibouti in 2006^[247]

Obama receiving a Pittsburgh Steelers jersey from Steelers owner Dan Rooney, who campaigned for Obama in 2008^[248]

Obama is a well known supporter of the Chicago White Sox, and threw out the first pitch at the 2005 ALCS when he was still a senator.^[249] In 2009, he threw out the ceremonial first pitch at the all star game while wearing a White Sox jacket.^[250] He is also primarily a Chicago Bears fan in the NFL, but is known to also support the Pittsburgh Steelers, and openly rooted for them ahead of their victory in Super Bowl XLIII 12 days after Obama took office as President.^[248]

In June 1989, Obama met Michelle Robinson when he was employed as a summer associate at the Chicago law firm of Sidley Austin.^[251] Assigned for three months as Obama’s adviser at the firm, Robinson joined him at group social functions, but declined his initial requests to date.^[252] They began dating later that summer, became engaged in 1991, and were married on October 3, 1992.^[253] The couple’s first daughter, Malia Ann, was born on July 4, 1998,^[254] followed by a second daughter, Natasha (“Sasha”), on June 10, 2001.^[255] The Obama daughters attended the private University of Chicago Laboratory Schools. When they moved to Washington, D.C., in January 2009, the girls started at the private Sidwell Friends School.^[256] The Obamas have a Portuguese Water Dog named Bo, a gift from Senator Ted Kennedy.^[257]

Applying the proceeds of a book deal, the family moved in 2005 from a Hyde Park, Chicago condominium to a $1.6 million house in neighboring Kenwood, Chicago.^[258] The purchase of an adjacent lot and sale of part of it to Obama by the wife of developer, campaign donor and friend Tony Rezko attracted media attention because of Rezko’s subsequent indictment and conviction on political corruption charges that were unrelated to Obama.^[259]

In December 2007, Money magazine estimated the Obama family’s net worth at $1.3 million.^[260] Their 2009 tax return showed a household income of $5.5 million—up from about $4.2 million in 2007 and $1.6 million in 2005—mostly from sales of his books.^[261][262]

Obama tried to quit smoking several times over the years and has used nicotine replacement therapy.^{[263][264][265]} However in June 2010, during a congratulatory phone call to president-elect Benigno Aquino of the Philippines, Obama told Aquino that he had quit and would offer advice on how to stop smoking when Aquino was himself ready for that step.^[266]

The US subprime mortgage crisis was one of the first indicators of the 2007–2010 financial crisis, characterized by a rise in subprime mortgage delinquencies and foreclosures, and the resulting decline of securities backing said mortgages.

Approximately 80% of U.S. mortgages issued to subprime borrowers were adjustable-rate mortgages.^[1] After U.S. house sales prices peaked in mid-2006 and began their steep decline thereafter, refinancing became more difficult. As adjustable-rate mortgages began to reset at higher interest rates, mortgage delinquencies soared. Securities backed with mortgages, including subprime mortgages, widely held by financial firms, lost most of their value. Global investors also drastically reduced purchases of mortgage-backed debt and other securities as part of a decline in the capacity and willingness of the private financial system to support lending. Concerns about the soundness of U.S. credit and financial markets led to tightening credit around the world and slowing economic growth in the U.S. and Europe

Google China

Type	Private
Industry	Internet, Computer software
Founded	2005
Founder(s)	Google
Headquarters	Beijing, People’s Republic of China
Area served	People’s Republic of China
Parent	Google
Website	www.google.cn (redirected to http://www.google.com.hk since March 2010, some services have been partially or fully blocked in mainland China[1])

Google China (谷歌, pinyin: Gǔgē) is a subsidiary of Google, Inc., the world’s largest Internet search engine company. Google China ranks as the number 2 search engine in the People’s Republic of China, after Baidu.

//

[edit] History

Google China was founded in 2005 and was originally headed by Kai-Fu Lee, a former Microsoft executive and the founder in 1998 of Microsoft Research Asia.^[2] Microsoft sued Google and Kai-Fu Lee for the move, but reached a confidential settlement.^[3] Google’s Beijing based office was initially located at NCI Tower.

In 2005, a Chinese-language interface was developed for the google.com website. In Jan 2006, Google launched its China-based google.cn search page with results subject to censorship by the Chinese government.

The Beijing office was moved to Tsinghua Science Park in early 2006. The newest office has been in use since September 2006. It is a 10-floor building located in Tsinghua Science Park, near the south gate of Tsinghua University.

In Mar 2009, China blocked access to Google‘s YouTube site; access to other Google online services is denied to users on an ad hoc basis.

On September 4, 2009, after four years leading Google China, Kai-Fu Lee announced his surprise departure to start a venture fund amid debate about the Chinese government’s censorship policies and Google’s decreasing share to rival Baidu.^[2]

In Jan 2010, Google announced that they and other US tech companies had been hacked and that Google is no longer willing to censor searches in China and may pull out of the country.^[4]

On March 23, 2010 at 3 am Hong Kong Time (UTC+8), Google started to redirect all search queries from Google.cn to Google.com.hk. (Google Hong Kong), thereby bypassing Chinese regulators and allowing uncensored Simplified Chinese search results.^[5][6][7] As a special entity recognized by international treaty, Hong Kong is vested with independent judicial power^[8] and not subject to most Chinese laws,^[9] including those requiring the restriction of free flow of information and censorship of internet materials.

David Drummond, senior vice president of Google, stated in the official Google blog that the current circumstances surrounding censorship of the Internet in Mainland China led Google to make such a decision. Hong Kong is a Special Administrative Region in China with a comparably higher level of freedom of speech and expression, and google.com.hk does not censor search results, making it more effective for networking and sharing information with Internet users in mainland China.^[7][10] Google’s internet mail service, Gmail, is available to mainland China users. Google has maintained that it would continue with the research and development offices in China along with the sales offices for other Google products such as Android smartphone software.^[11]

On March 30, 2010, searching via all Google search sites (not only google.cn but all language versions, e.g. google.co.jp. google.com.au, etc.), including Google Mobile, was banned in Mainland China. Any attempt to search using Google resulted in a DNS error. Other Google services such as Google Mail and Google Maps appeared to be unaffected.^[12] Xiao Qiang, director of the China Internet Project at UC Berkeley and founder of the China Digital Times, noted that the ban in mainland China could eventually block all access to Google sites and applications if the Chinese Government wanted.^[12] The ban was lifted the day after.^[13]

On June 30, 2010, Google ended the automatic redirect of Google China to Google Hong Kong, and instead placed a link to Google Hong Kong to avoid getting their Internet Content Provider (ICP) license revoked.

 Business

Google China headquarters in Tsinghua Science Park, Beijing

Google China serves a market of mainland Chinese Internet users that was estimated in July 2009 to number 338 million.^[14] This estimate is up from 45.8 million in June 2002, according to a survey report from the China Internet Network Information Center (CNNIC) released on June 30, 2002.^[15] A CNNIC report published a year and a half earlier, on January 17, 2001, estimated that the mainland Chinese Internet user base numbered 22.5 million people; this was considerably higher than the number published by Iamasia, a private Internet ratings company.^[16] The first CNNIC report, published on October 10, 1997, estimated the number of Chinese internet users at fewer than 650 thousand people.

The competitors of Google China include Baidu.com, often called the “Google of China” due to its resemblance and similarity to Google.^[17][18] In August 2008, Google China launched a legal music download service, Google Music, to rival Baidu’s potentially illicit offering.^[19]

GOOGLE China local product——Google MUSIC’s conference

Google China has a market share in China of 29% according to Analysys International.^[20]

 Controversies

Prior to Google China’s establishment, Google.com itself was accessible, even though much of its content was not accessible due to censorship. According to official statistics, google.com was accessible 90% of the time, and a number of services were not available at all.^[21]

Since announcing its intent to comply with Internet censorship laws in the People’s Republic of China, Google China had been the focus of controversy over what critics view as capitulation to the “Golden Shield Project”. Due to its self-imposed censorship, whenever people searched for prohibited Chinese keywords on a blocked list maintained by the PRC government, google.cn displayed the following at the bottom of the page (translated): In accordance with local laws, regulations and policies, part of the search result is not shown. Some searches, such as (as of June 2009) “Tank Man” were blocked entirely, with only the message “Search results may not comply with the relevant laws, regulations and policy, and can not be displayed” appearing.

Google argued that it could play a role more useful to the cause of free speech by participating in China’s IT industry than by refusing to comply and being denied admission to the mainland Chinese market. “While removing search results is inconsistent with Google’s mission, providing no information (or a heavily degraded user experience that amounts to no information) is more inconsistent with our mission,” a statement said.^[22]

A PBS analysis reported clear differences between results returned for controversial keywords by the censored and uncensored search engines.^[23] Google set up computer systems inside China that try to access Web sites outside the country. If a site is inaccessible (e.g., due to the Golden Shield Project), then it was added to Google China’s blacklist.^[24]

In June 2006, Sergey Brin, Google’s co-founder, was quoted as saying virtually all of Google’s customers in China were using the non-censored version of their website.^[25]

Google critics in the United States claimed that Google China is a flagrant violation of the Google motto, “Don’t be evil.” ^[26]

On April 9, 2007, Google China spokesman Cui Jin admitted that the pinyin Google Input Method Editor (IME) “was built leveraging some non-Google database resources”. This was in response to a request on April 6 from the Chinese search engine company Sohu that Google stop distributing its pinyin IME software due to the fact that it allegedly copied portions from Sohu’s own software.^[27]

In early 2008, Guo Quan, a university professor who had been dismissed after having founded a democratic opposition party, announced plans to sue Yahoo! and Google in the United States for having blocked his name from search results in mainland China.^[28]

[edit] Operation Aurora

On January 12, 2010, Google announced that it was “no longer willing to continue censoring” results on Google.cn, citing a breach of Gmail accounts of Chinese human rights activists. The company found that the hackers had breached two Gmail accounts but were only able to access ‘from’ and ‘to’ information and subject headers of emails in these accounts.^[29] The company’s investigation into the attack showed that at least 34 other companies had been similarly targeted. Among the companies that were attacked were Adobe Systems, Symantec, Yahoo, Northrop Grumman and Dow Chemical. Experts claim the aim of the attacks was to gain information on weapon systems, political dissidents, and valuable source code that powers software applications.^[30] Additionally, dozens of Gmail accounts in China, Europe, and the United States had been regularly accessed by third parties, due to phishing or malware on the users’ computers rather than a security breach at Google. Although Google did not explicitly accuse the Chinese government of the breach, it said it was no longer willing to censor results on google.cn, and that it will discuss over the next few weeks “the basis on which we could run an unfiltered search engine within the law, if at all. We recognize that this may well mean having to shut down Google.cn, and potentially our offices in China.”^[31][32] Google.cn transiently turned off its search result filtering. However, the filtering was later re-enabled without any acknowledgment or explanation; search queries in Chinese on the keywords Tiananmen or June 4, 1989 returned censored results with the standard censorship footnote.^[33]

On January 13, 2010, the news agency AHN reported that the U.S. Congress plans to investigate Google’s allegations that the Chinese government used the company’s service to spy on human rights activists.^[34] In a major speech by the US Secretary of State Hillary Clinton, analogies were drawn between the Berlin Wall and the free and unfree Internet.^[35] Chinese articles came back saying that the U.S. uses the internet as a means to create worldwide hegemony based on western values.^[36] The issue of Google’s changed policy toward China has been cited as a potentially major development in world affairs, marking a split between authoritarian capitalism and the alleged Western model of free capitalism and Internet access.^[37]

The Chinese government has since made numerous standard and general statements on the matter, but has taken no real actions. It also criticized Google for failing to provide any evidence of its accusation.^[38] Accusations were made by Baidu, a competing Chinese search engine, that Google was pulling out for financial rather than humanitarian reasons. Baidu is the market leader in China with about 60% of the market share compared to Google’s 31%, Yahoo placing third with less than 10%.^[39] China Daily published a scathing op-ed on Google which criticized western leaders for politicizing the way in which China controls citizen’s access to the Internet, saying “implementing monitoring according to a country’s national context is what any government has to do,” and that China’s need to censor the internet is greater than that of developed countries, “The Chinese society has generally less information bearing capacity than developed countries such as the U.S. …”^[40]

 In media

Joseph Cheng, a professor of political science from City University of Hong Kong pointed out that the ruling Chinese Communist Party was deploying Chinese nationalism to stifle debate about censorship.^[41] By criticizing cultural export (in this case, the localization of Google in China), it provides defence to justify the Chinese authorities’ censorship control.^[41]

The Chinese authority is accused of steering state-run media to bundle Google together with other recent disputes with United States that have stirred nationalist rancour in China. On the website of the Global Times (www.huanqiu.com) such examples are found, one user wrote “Get the hell out” while another one wrote “Ha ha, I’m going to buy firecrackers to celebrate!“.^[41]

According to Isaac Mao, a high profile Chinese Internet expert, maybe 90% of Internet users in China don’t care whether Google leaves or not. For Chinese users who strongly support Google’s stay in China without censorship (or leaving China to keep its neutrality and independence), some are accustomed to use circumvention technology to access blocked websites

Type	Subsidiary of eBay Inc.
Genre	e-commerce
Founded	Palo Alto, California USA (1998)
Founder	Ken Howery Max Levchin Elon Musk Luke Nosek Peter Thiel
Headquarters	San Jose, California USA
Area served	Worldwide
Key people	Scott Thompson, President Patrick Dupuis, CFO
Revenue	US$2.23 billion (2009)
Owner	eBay Inc.
Website	www.paypal.com
Alexa rank	30[1]
Advertising	None
Registration	Optional
Available in	Multilingual
Current status	Active
Screenshot[show] PayPal homepage

eBay‘s North First Street satellite office campus (home to PayPal’s corporate headquarters)

PayPal is an e-commerce business allowing payments and money transfers to be made through the Internet. Online money transfers serve as electronic alternatives to traditional paper methods such as checks and money orders.

A PayPal account can be funded with an electronic debit from a bank account or by a credit card. The recipient of a PayPal transfer can either request a check from PayPal, establish their own PayPal deposit account or request a transfer to their bank account.

PayPal performs payment processing for online vendors, auction sites, and other commercial users, for which it charges a fee. It may also charge a fee for receiving money, proportional to the amount received. The fees depend on the currency used, the payment option used, the country of the sender, the country of the recipient, the amount sent and the recipient’s account type.^[2] In addition, eBay purchases made by credit card through PayPal may incur extra fees if the buyer and seller use different currencies.

On October 3, 2002, PayPal became a wholly-owned subsidiary of eBay.^[3] Its corporate headquarters are in San Jose, California, United States at eBay’s North First Street satellite office campus. The company also has significant operations in Omaha, Nebraska; Scottsdale, Arizona; and Austin, Texas in the U.S., Chennai, Dublin, Berlin and Tel-Aviv. As of July 2007, across Europe, PayPal also operates as a Luxembourg-based bank.

On March 17, 2010, PayPal entered into an agreement with China UnionPay (CUP), China’s bankcard association, to allow Chinese consumers to use PayPal to shop online.^{[citation needed]} PayPal is planning to expand its workforce in Asia to 2,000 by the end of the year 2010.^{[4][5][dated info]}

Between December 4–9, 2010, PayPal services were distrupted due to denial-of-service attacks organized by Anonymous in retaliation to PayPal’s decision to freeze the account of WikiLeaks citing terms of use violations over the publication of leaked US diplomatic cables.^[6][7][8][9]

//

History

Beginnings

The current incarnation of PayPal is the result of a March 2000 merger between Confinity and X.com.^[10] Confinity was founded in December 1998 by Max Levchin, Peter Thiel, Luke Nosek, and Ken Howery, initially as a Palm Pilot payments and cryptography company.^[11] X.com was founded by Elon Musk in March 1999, initially as an Internet financial services company. Both Confinity and X.com launched their websites in late 1999. Both companies were located on University Avenue in Palo Alto. Confinity’s website was initially focused on reconciling beamed payments from Palm Pilots^[12] with email payments as a feature and X.com’s website initially featured financial services with email payments as a feature.

At Confinity, many of the initial recruits were alumni of The Stanford Review, also founded by Peter Thiel, and most early engineers hailed from the University of Illinois at Urbana-Champaign, recruited by Max Levchin. On the X.com side, Elon Musk recruited a wide range of technical and business personnel, including many that were critical to the combined company’s success, such as Amy Klement, Sal Giambanco, Roelof Botha^[13] of Sequoia Capital, Sanjay Bhargava and Jeremy Stoppelman.^[14]

To block potentially fraudulent access by automated systems, PayPal used a system (see CAPTCHA) of making the user enter numbers from a blurry picture, which they coined the Gausebeck-Levchin test.^[15]

eBay watched the rise in volume of its online payments and realized the fit of an online payment system with online auctions. eBay purchased Billpoint in May 1999, prior to the existence of PayPal. eBay made Billpoint its official payment system, dubbing it “eBay Payments,” but cut the functionality of Billpoint by narrowing it to only payments made for eBay auctions. For this reason, PayPal was listed in many more auctions than Billpoint. In February 2000, the PayPal service had an average of approximately 200,000 daily auctions while Billpoint (in beta) had only 4,000 auctions.^[16][17][18] By April 2000, more than 1,000,000 auctions promoted the PayPal service.^[19] PayPal was able to turn the corner and become the first dot-com to IPO after the September 11 attacks.^[20]

 Acquisition by eBay

In October 2002, PayPal was acquired by eBay for $1.5 billion.^[21] PayPal had previously been the payment method of choice by more than fifty percent of eBay users, and the service competed with eBay’s subsidiary Billpoint, Citibank‘s c2it, whose service was closed in late 2003, and Yahoo!‘s PayDirect, whose service was closed in late 2004. Western Union announced the December 2005 shut down of their BidPay service but subsequently sold it in 2006 to CyberSource Corporation. BidPay subsequently ceased operations on December 31, 2007. Some competitors which offer some of PayPal’s services, such as Google Checkout, Wirecard, and Moneybookers remain in business, despite the fact that eBay now requires everyone on its Australian and United Kingdom sites to offer PayPal.^[22][23] Eventually eBay moderated its position, and mandated that sellers on eBay Australia offer PayPal as one of the (but not necessarily the only) payment methods.^[24] These accepted payment methods include bank deposit, cheques and money orders, escrow, and credit cards (processed by other than PayPal).^[25]

In January 2008, PayPal agreed to acquire Fraud Sciences, a privately-held Israeli start-up company with expertise in online risk tools, for $169 million, in order to enhance eBay and PayPal’s proprietary fraud management systems and accelerate the development of improved fraud detection tools.^[26] In November 2008, the company acquired Bill Me Later, an online payments company offering transactional credit at over 1000 online merchants in the US.^[27]

PayPal’s total payment volume, the total value of transactions, was US$ 60 billion in 2008, an increase of 27 percent over the previous year,^[28] and US$ 71 billion in 2009, an increase of 19 percent over the previous year.^[29] The company continues to focus on international growth and growth of its Merchant Services division, providing e-payments for retailers off eBay.

 Business today

Currently, PayPal operates in 190 markets, and it manages more than 232 million accounts, more than 87 million of them active. PayPal allows customers to send, receive, and hold funds in 24 currencies worldwide.^[28] These currencies are the Australian dollar, Brazilian real, Canadian dollar, Chinese renminbi yuan (only available for some Chinese accounts, see below), Euro, pound sterling, Japanese yen, Czech koruna, Danish krone, Hong Kong dollar, Hungarian forint, Israeli new sheqel, Malaysian Ringgit, Mexican peso, New Zealand dollar, Norwegian krone, Philippine Peso, Polish zloty, Singapore dollar, Swedish krona, Swiss franc, New Taiwan Dollar, Thai Baht and U.S. dollar. PayPal operates locally in 21 countries.

Residents in 194 markets^{[clarification needed]} can use PayPal in their local markets to send money online.

PayPal revenues for Q1 2009 were $643 million, up 11 percent year over year. 42 percent of revenues in q1 2009 were from international markets. PayPal’s Total Payment Volume (TPV), the total value of transactions in Q1 2009 was nearly $16 billion, up 10 percent year over year.^[30]

In 2008, PayPal’s TPV off eBay exceeded volume on eBay for the first time. PayPal’s Total Payment Volume in 2008 was $60 billion representing nearly 9 percent of global e-commerce and 15 percent of US e-commerce.^[31]

At an analyst day on March 11, 2009, eBay CEO, John Donahoe announced that PayPal could be a larger driver of revenue than the eBay marketplaces business.^[32] RIM announced that PayPal will be the only payment mechanism for its Blackberry App World, which launched on April 1, 2009.^[33]

PayPal launched Student Accounts for teens in August 2009 allowing parents to set up a student account, transfer money into it, and obtain a debit card for student use. The program provides tools to teach teens how to spend money wisely and take responsibility for their actions.^[34][35]

In November 2009 PayPal opened its platform, allowing other services to get access to its code and to use its infrastructure in order to enable peer-to-peer online transactions.^[36]

PayPal Operations Center and main office outside Omaha, NE

Although PayPal’s corporate headquarters are located in San Jose, PayPal’s operations center is located near Omaha, Nebraska, where the company employs more than 2,000 people as of 2007.^[37] PayPal’s European headquarters are in Luxembourg and international headquarters in Singapore. The company also recently^[when?] opened a technology center in Scottsdale, Arizona, and Chennai, India.

 PayPal business model evolution

PayPal’s success in terms of users and volumes was the product of a three-phase strategy described by eBay CEO Meg Whitman: “First, PayPal focused on expanding its service among eBay users in the U.S. Second, we began expanding PayPal to eBay’s international sites. And third, we started to build PayPal’s business off eBay”.^[38]

 Phase-1

In the first phase, payments volumes were coming mostly from eBay auction web-site. The system was very attractive to auction sellers, most of which were individuals or small businesses that were unable to accept credit card, and for consumers as well. In fact, many sellers could not qualify for a credit card “merchant account” because they lacked a commercial credit history. The service also appealed to auction buyers because they could fund PayPal accounts using credit cards or bank account balances, without divulging credit card numbers to unknown sellers. PayPal employed an aggressive marketing campaign to accelerate its growth, depositing $10 in new users’ PayPal accounts (+$10 for each new user they referred).

 Phase-2

The biggest challenge in 2000 remained PayPal’s unsustainable business model. Initially, PayPal offered its service free of charge, planning to earn interest on funds in users’ PayPal accounts (i.e., the “float”). However, most recipients withdrew their funds immediately. Furthermore, a large majority of senders funded their payments using credit cards, which cost PayPal roughly 2% of payment value, rather than relying on electronic transfers from bank accounts, which were much less costly.

In order to boost its user base over eBay, both in US and internationally, PayPal decided to lever some of the ever existing concerns of sellers and buyers dealing with the virtual world, simplifying and easing the procedures regarding litigations, frauds and liabilities (transaction losses borne by PayPal also included the cost of buyer and seller protection programs. In fact, when merchants went bankrupt—not rare events in online retailing—PayPal was liable for any outstanding chargebacks related to credit card-funded PayPal payments. As with credit cards, buyers were protected against unauthorized use of their PayPal accounts. In addition, eBay buyers using PayPal received up to $1,000 in fraud protection (with a limit of three refunds per year) for items never delivered or materially misrepresented, but only if the seller had high eBay feedback ratings. Finally, subject to a $5,000 annual cap, merchants with business accounts qualified for seller protection against losses due to chargebacks, provided that they complied with reimbursement policies (e.g., retaining traceable proof of shipping to a confirmed address or requiring a signature receipt for items valued over $250).

 Phase-3

After fine-tuning PayPal’s business model and increasing its domestic and international penetration on eBay, PayPal started its off-eBay strategy. Strong growth in active users growth by adding users across multiple platforms, despite the slowdown in on-eBay growth and low-single-digit user growth on the eBay site. A late 2003 reorganization created a new business unit within PayPal—Merchant Services—to provide payment solutions to small and large e-commerce merchants outside the eBay auction community. Starting in the second half of 2004, PayPal Merchant Services unveiled several initiatives to enroll online merchants outside the eBay auction community, including:

• Lowering its transaction fee for high-volume merchants from 2.2% to 1.9% (while increasing the monthly transaction volume required to qualify for the lowest fee to $100,000)
• Encouraging its users to recruit non-eBay merchants by increasing its referral bonus to a maximum of $1,000 (versus the previous $100 cap)
• Persuading credit card gateway providers, including CyberSource and Retail Decisions USA, to include PayPal among their offerings to online merchants.
• Hiring a new sales force to acquire large merchants such as Dell, Apple’s iTunes, and Yahoo! Stores, which hosted thousands of online merchants
• Reducing fees for online music purchases and other “micropayments”
• Launching PayPal Mobile, which allowed users to make payments using text messaging on their cell phones

 Local restrictions

 China

In China PayPal offers two kinds of accounts:

• PayPal.com accounts, for sending and receiving money to/from other PayPal.com accounts. All non-Chinese accounts are PayPal.com accounts, so these accounts may be used to send money internationally.
• PayPal.cn accounts, for sending and receiving money to and from other PayPal.cn accounts.

It is impossible to send money between PayPal.cn accounts and PayPal.com accounts, so PayPal.cn accounts are effectively unable to make international payments. For PayPal.cn, the only supported currency is the renminbi.

 Japan

In late March 2010, new Japanese regulations forced PayPal to suspend the ability of Japanese individuals to pay money to other individuals.^[39][40]

 Taiwan

As of mid July 2010, users in Taiwan have noticed that the “Personal” tab for sending money has been omitted without notice. There is no longer an option to send personal payments, thus forcing all recipients to pay a fee.^{[citation needed]}

 Brazil

As of mid-November 2010, users in Brazil also have noticed that the “Personal” tab for sending money has been omitted without notice. There is no longer an option to send personal payments, thus forcing all recipients to pay a fee. Balance transfers between PayPal accounts of the same account holder incur an additional 6.4% fee.

As of beginning January 2011, Brazilian users are no longer allowed to withdraw money using credit/debit cards.

 PayPal Labs

PayPal’s innovation environment, PayPal-Labs.com,^[41] hosts several outreach and experimental projects such as the storefront application,^[42] the MySpace and Facebook donation widgets, and the PayPal blog.^[43]

 Bank status

In the United States, PayPal is licensed as a money transmitter on a state-by-state basis.^[44] PayPal is not classified as a bank in the United States, though the company is subject to some of the rules and regulations governing the financial industry including Regulation E consumer protections and the USA PATRIOT Act.^[45]

Commencing 2 July 2007, as PayPal (Europe) S.à r.l. & Cie, S.C.A., PayPal moved its European operations from the UK to Luxembourg. As a Luxembourg entity, it is since regulated as a bank by the Commission de Surveillance du Secteur Financier (CSSF) and provides PayPal service throughout the European Union.

 Safety and protection policies

The PayPal Buyer Protection Policy states that the customer may file a buyer complaint within 45 days if they did not receive an item or if the item they purchased was significantly not as described. If the buyer used a credit card, they might get a refund via chargeback from their credit-card company.

According to PayPal, it protects sellers in a limited fashion via the Seller Protection Policy.^[46] In general the Seller Protection Policy is intended to protect the seller from certain kinds of chargebacks or complaints if seller meets certain conditions including proof of delivery to the buyer. PayPal states the Seller Protection Policy is “designed to protect sellers against claims by buyers of unauthorized payments and against claims of non-receipt of any merchandise”. The policy includes a list of “Exclusions” which itself includes “Intangible goods”, “Claims for receipt of goods ‘not as described'” and “Total reversals over the annual limit”. There are also other restrictions in terms of the sale itself, the payment method and the destination country the item is shipped to (simply having a tracking mechanism is not sufficient to guarantee the Seller Protection Policy is in effect).^[47]

 Security

A credit-card sized alternative to the keychain security token, the PayPal Keycard generates a temporary login code to authenticate the user.

 Security key

In early 2006, PayPal introduced an optional security key as an additional precaution against fraud. A user account tied to a security key has a modified login process: the account holder enters their login ID and password, as normal, but is then prompted to press the button on the security key and enter the six-digit number generated by it. For convenience, the user may append the six-digit to their password in the login screen. This way they are not prompted for it on another page. Using this method is required for some services, such as when using PayPal through the eBay application on iPhone.

This two-factor authentication is intended to make account compromise by a malicious third party without access to the physical security key difficult, although it does not prevent so-called Man in the Browser (MITB) attacks. However, the user (or malicious third party) can alternatively authenticate by providing the credit card or bank account number listed on their account. Thus, the PayPal’s implementation does not offer the security of true two-factor authentication.

The key currently costs US$5.00 for all users with no ongoing fees.^[48] The option of using a security key with one’s account is currently available only to users registered in Australia, Germany, Canada, the United Kingdom and the United States.^[49]

 MTAN

It is also possible to use a mobile phone to receive an MTAN (Mobile Transaction Authentication Number) via SMS,.^[50] Like all security measures, there have been reports of vulnerabilities to older mobile handsets.^[51]

 Regulation

In Europe, PayPal is registered as a bank in Luxembourg under the legal name PayPal (Europe) Sàrl et Cie SCA, a company regulated centrally by the Luxembourg bank authority, the Commission de Surveillance du Secteur Financier (CSSF)^[52] (note that all of the company’s European accounts were transferred to the PayPal’s bank in Luxembourg on July 2, 2007.^[53]) Prior to this move, PayPal had been registered in the UK as PayPal (Europe) Ltd, an entity which was licensed as an Electronic Money Issuer with the UK’s Financial Services Authority (FSA) from 2004. This ceased in 2007, when the company moved to Luxembourg.^[54][55]

In the US, although PayPal has an extensive User Agreement,^[56] PayPal is not directly regulated by the U.S. federal government, because it serves as a payment intermediary.^[57] The law is unclear as to whether PayPal is a bank, narrow bank, money services business or money transmitter. PayPal could also be subject to state regulation, but state laws vary, as do their definitions of banks, narrow banks, money services businesses and money transmitters. The most analogous regulatory source of law for PayPal transactions comes from P2P payments using credit and debit cards. Ordinarily, a credit card transaction, specifically the relationship between the issuing bank and the cardholder, is governed by the Truth in Lending Act (TILA) 15 U.S.C. §§ 1601-1667f as implemented by Regulation Z, 12 C.F.R. pt. 226, (TILA/Z). TILA/Z requires specific procedures for billing errors, dispute resolution and limits cardholder liability for unauthorized charges.^[58] Similarly, the legal relationship between a debit cardholder and the issuing bank is regulated by the Electronic Funds Transfer Act (EFTA) 15 U.S.C. §§ 1693-1693r, as implemented by Regulation E, 12 C.F.R. pr. 205, (EFTA/E). EFTA/E is directed at consumer protection and provides strict error resolution procedures.^[59] However, because PayPal is a payment intermediary and not otherwise regulated directly, TILA/Z and EFTA/E do not operate exactly as written once the credit/debit card transaction occurs via PayPal. Basically, unless a PayPal transaction is funded with a credit card, the consumer has no recourse in the event of fraud by the seller.^{[citation needed]}

In India, as of January 27, 2010, PayPal has no cross-border money transfer authorization. In The New York Times article “India’s Central Bank Stops Some PayPal Services”, Reserve Bank of India spokesman Alpana Killawalla stated: “Providers of cross-border money transfer service need prior authorization from the Reserve Bank under the Payment and Settlement Systems Act, PayPal does not have our authorization.”^[60] PayPal is not listed in the “Certificates of Authorisation issued by the Reserve Bank of India under the Payment and Settlement Systems Act, 2007 for Setting up and Operating Payment System in India”.^[61]

 Fraud

The examples and perspective in this The EFTA/E and TILA/Z and other legal documents only apply the American division of PayPal. Different documents (not sure which ones) apply to PayPal Europe. may not represent a worldwide view of the subject. Please improve this article and discuss the issue on the talk page. (January 2011)

If an unauthorized third party obtains and uses someone’s PayPal login information and completes a transaction using the accountholder’s debit or credit card, EFTA/E and TILA/Z make PayPal responsible for the breach. There are, of course, fact specific exceptions to this rule. One is if funds are illicitly withdrawn from a PayPal deposit account. In that situation, neither PayPal nor the bank is required to return the funds, because the agreement between a consumer and PayPal makes those types of transactions authorized.^[62]

PayPal account holders’ private information is marginally protected under one federal law. Since PayPal is a financial institution under the Gramm-Leach-Bliley Act (GLB), it cannot disclose its account holders’ non-public personal information to third parties unless account holders opt in to those disclosures.^[63]

If an account is subject to fraud or unauthorized use, PayPal puts the “Limited Access” designation on the account. At this point, the account holder must:

• Log in
• Reset their password
• Develop a set of security questions (based on the hypothetical and not fact — e.g. “What is your favorite ice cream?” not “What is your mother’s maiden name?”)
• Verify location by phone or by mail

[edit] Phishing

PayPal presents anti-phishing advice on their website^[64] for identifying and reporting phishing. PayPal encourages consumers to report all phishing emails to them.

One domain used for phishing activities is @eu-pay-pal.com. Any email from this particular address is to be regarded as fraudulent.

 Criticism and limitations

A concern has been raised that this article’s Criticism section may be compromising the article’s neutral point of view of the subject. Possible resolutions may be to integrate the material in the section into the article as a whole, or to rewrite the contents of the section. Please see the discussion on the talk page. (May 2009)

The current PayPal user agreement is 25 pages long.^{[clarification needed]} If one buys an item from a PayPal merchant, one is agreeing to an additional layer of arbitration beyond the merchant himself. Thus even if the merchant has acted improperly, PayPal has not violated their own policy until the user has gone through an extra arbitration process with PayPal. Only when PayPal fails to arbitrate according to their 25-page user agreement can the user go on to the normal dispute resolution with his credit card issuer.

In September 2005, Richard Kyanka, owner of the website Something Awful, set up an account to collect donations for Hurricane Katrina to be given to the Red Cross. Owing to the high rate at which donations were made, the account was automatically frozen, and Kyanka criticized the time and difficulty involved in getting PayPal’s customer service to unfreeze the account. In response to the concerns of Something Awful members over the charity used by PayPal, United Way, Kyanka finally opted to have the money refunded to the donors so that they could donate directly to their charities of choice, though PayPal did not refund exchange and handling fees for international donors.^[65][66]

In March 2008, Australian current affairs show Today Tonight aired a segment criticising PayPal, with regard to safety, freezing accounts and customer service.^[67]

Several PayPal gripe sites have been created complaining of problems such as the freezing of accounts of eCommerce stores if they experience rapid growth, preventing them from being able to pay suppliers and fulfill orders.^[68] One such site, Paypalsucks.com,^[69] ranked third on a Forbes Magazine listing of “Top Corporate Hate Web Sites” in 2005 based on “hostility” and “entertainment value” of web forum postings and other criteria.^[70]

In June 2008, the Australian Competition and Consumer Commission found that, “The evidence available does not support the view that PayPal is the most secure method of payment, or offers the best service for all transactions.”^[71]

In February 2010, PayPal stopped or reversed all “personal” transactions in or out of India without prior notice. Funds already transferred and transactions that had previously been “completed” were reversed leaving many vendor accounts over-drafted. Companies, contractors and service providers throughout India were left in debt to PayPal for services they had already provided when PayPal, without warning or consent, returned funds vendors had already received and withdrawn.^[72]

In spite of its international reach, PayPal has limited functionalites for multi-country users, most notably the impossibility to have bank accounts in several countries, or to have a shipping address in a different country than one’s bank account / credit card.

In March 2010, PayPal froze donations to Cryptome, seizing over $5300 of in-transit donations.^[73] PayPal refused to inform Cryptome of the reason for this action, claiming that to disclose why the donations had been confiscated would violate Cryptome’s own privacy.^[74] A week later, PayPal offered an apology, which was rejected by Cryptome founder John Young as “insulting and unacceptable”.^[75]

In September 2010, PayPal froze the account of Markus Persson, developer of independent video game Minecraft. His account contained around €600,000.^[76][77]

Also in September 2010, PayPal froze the account of the open-source revision control software TortoiseSVN. The lead developer compared the situation to a car shop that “decides not to do business with you anymore. … But then the shop owner tells you that they keep your car for half a year first because that’s their policy.”^[78]

In December 2010, PayPal permanently restricted an account used to raise funds for WikiLeaks citing it was in violation of the PayPal Acceptable Use Policy. At a conference in Paris, a PayPal VP, in response to an attendees question, stated the account was restricted after PayPal was allegedly pressured by the U.S. State Department.^[79] Afterwards, PayPal reiterated the decision was based on violation of PayPal’s Acceptable Use Policy. This was followed by cyber attack on the paypal.com website and a small boycott of PayPal, in which some users closed their PayPal account in protest.

[edit] Litigation

This article is outdated. Please update this article to reflect recent events or newly available information. Please see the talk page for more information. (July 2010)

In 2002, CertCo filed a suit against PayPal claiming patent infringement concerning the use of distributed computing systems that process micropayments, or small cash amounts. In April 2002, CertCo dropped the suit and stated that they had come to a settlement involving, “a non-consequential payment and mutual releases.”^[80]

In March 2002, two PayPal account holders separately sued the company for alleged violations of the Electronic Funds Transfer Act (EFTA) and California law. Most of the allegations concerned PayPal’s dispute resolution procedures. The two lawsuits were merged into one class action lawsuit (In re: PayPal litigation). An informal settlement was reached in November 2003, and a formal settlement was signed on June 11, 2004. The settlement requires that PayPal change its business practices (including changing its dispute resolution procedures to make them EFTA-compliant), as well as making a US$9.25 million payment to members of the class. PayPal denied any wrongdoing.^[81]

In May 2002, Tumbleweed Communications filed a lawsuit against PayPal (and later expanded it to include eBay) claiming that PayPal had violated its patents for sending personalized links through e-mail, which PayPal uses to alert its customers about financial transactions. In January 2004, the two parties came to an agreement, but didn’t disclose the financial terms of their licensing agreement.^[82]

In June 2003, Stamps.com filed a lawsuit against PayPal and eBay claiming breach of contract, breach of the implied covenants of good faith and fair dealing, and interference with contract, among other claims. In a 2002 license agreement, Stamps.com and PayPal agreed that Stamps.com technology would be made available to allow PayPal users to buy and print postage online from their PayPal accounts. Stamps.com claimed that PayPal did not live up to its contractual obligations and accused eBay of interfering with PayPal and Stamps.com’s agreement, hence Stamp.com’s reasoning for including eBay in the suit.^[83]

In August 2002, Craig Comb and two others filed a class action against PayPal in, Craig Comb, et al. v. PayPal, Inc.. They sued, alleging illegal misappropriation of customer accounts and detailed ghastly customer service experiences. Allegations included freezing deposited funds for up to 180 days until disputes are resolved by PayPal, and forcing customers to arbitrate their disputes under the American Arbitration Association‘s guidelines (a costly procedure). The court stated that “the User Agreement and arbitration clause are substantively unconscionable under California law,” noting their unjustifiable one-sidedness and explicit prohibition of class actions produces results that “shock the conscience” and indicate PayPal was “attempting to insulate itself contractually from any meaningful challenge to its alleged practices” and ruled against PayPal.^[84]

In September 2003, PayPal filed suit against Bank One Corporation for patent infringement. PayPal claimed that Bank One’s online bill-payment system was an infringement against PayPal’s online bill-payment patent, issued in 1998. PayPal filed the suit after a warning to the bank’s lawyers in February went unheeded.^[85]

In November 2003, AT&T filed suit against eBay and PayPal claiming that their payment systems infringed an AT&T patent, filed in 1991 and granted in 1994.^[86]

In March 2004, PayPal and New York state’s Attorney General, Eliot Spitzer, came to an agreement to require PayPal to disclose clients’ rights and liabilities more accurately and to pay $150,000 to the state of New York for penalties and the costs of the investigation.^[87]

In April 2007, one of two anti-trust lawsuits was filed against eBay/PayPal by Michael Malone of Texas.^[88] This suit claims that the monopolistic relationship between eBay and PayPal violates United States anti-trust laws.

The Delicious homepage
URL	delicious.com
Commercial?	Yes
Type of site	Online social bookmarking
Registration	Optional
Owner	Yahoo! Inc.
Created by	Joshua Schachter
Launched	September 2003
Alexa rank	254 (January 2011[update])[1]
Current status	Active

Delicious (formerly del.icio.us, pronounced “delicious”) is a social bookmarking web service for storing, sharing, and discovering web bookmarks. The site was founded by Joshua Schachter in 2003 and acquired by Yahoo! in 2005. By the end of 2008, the service claimed more than 5.3 million users and 180 million unique bookmarked URLs.^[2][3] It is headquartered in Sunnyvale, California.

//

 Site description

Delicious uses a non-hierarchical classification system in which users can tag each of their bookmarks with freely chosen index terms (generating a kind of folksonomy). A combined view of everyone’s bookmarks with a given tag is available; for instance, the URL “http://www.delicious.com/tag/wiki” displays all of the most recent links tagged “wiki”. Its collective nature makes it possible to view bookmarks added by other users.

Delicious has a “hotlist” on its home page and “popular” and “recent” pages, which help to make the website a conveyor of Internet memes and trends.

Delicious is one of the most popular social bookmarking services. Many features have contributed to this, including the website’s simple interface, human-readable URL scheme, a novel domain name, a simple REST-like API, and RSS feeds for web syndication.

Use of Delicious is gratis. The source code of the site is not available, but a user can download his or her own data through the site’s API in an XML or JSON format, or export it to a standard Netscape bookmarks format.

All bookmarks posted to Delicious are publicly viewable by default, although users can mark specific bookmarks as private, and imported bookmarks are private by default. The public aspect is emphasized; the site is not focused on storing private (“not shared”) bookmark collections.^[4] Delicious linkrolls, tagrolls, network badges, RSS feeds, and the site’s daily blog posting feature can be used to display bookmarks on weblogs.

There are several competing social bookmarking services as well as a few open source clones.

History

The old logo of Delicious.

The precursor to Delicious was Muxway, a link blog that had grown out of a text file that Schachter maintained to keep track of links related to Memepool.^[5] In September 2003, Schachter released the first version of Delicious.^[6] In March 2005, he left his day job to work on Delicious full-time, and in April 2005 it received approximately $2 million in funding from investors including Union Square Ventures and Amazon.com.^[7]

Yahoo! acquired Delicious on December 9, 2005.^[8] Various guesses suggest it was sold for somewhere between US$15 million and US$30 million.^[9][10]

On December 16, 2010, an internal slide from a Yahoo! meeting leaked, indicating that Delicious would be “sunsetted” in the future, which seemed to mean “shut down”.^[11] Later Yahoo clarified that they would be selling Delicious, not ending it.^[12]

 Name

The “del.icio.us” domain name was a well-known example of a domain hack, an unconventional combination of letters to form a word or phrase. Del.icio.us and delicio.us now redirect to the new domain, delicious.com.

In an interview, Schachter explained how he chose the name: “I’d registered the domain when .us opened the registry, and a quick test showed me the six letter suffixes that let me generate the most words. In early discussions, a friend referred to finding good links as ‘eating cherries’ and the metaphor stuck, I guess.”^[13]

On September 6, 2007, Schachter announced the website’s name would change to “Delicious” when the site would be redesigned.^[14] The new design went live on July 31, 2008.