Google’s (GOOG) chief executive Eric Schmidt said during a trip to Baghdad this week that Iraq’s stabilization could lead to business opportunities in the country.

Mr. Schmidt was part of a delegation, led by Peter Pace, the former chairman of the Joint Chiefs of Staff, to encourage business development in Iraq.

“After this tremendous investment in Iraq, we see business recovery finally happening,” he said in a video interview provided by the U.S. Army. “The creation of a new Iraqi state ultimately means business opportunities for global firms.”

“Google’s interested in making sure that Iraq ends up being an open and transparent democracy–after all, information makes a big difference in everybody’s lives,” Mr. Schmidt added.

The delegation met with both military and civilian leaders in Baghdad, he said. “It’s clear that the government is reaching out now to business, to try to get us to begin our part in the reconstruction of Iraq.”

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Saying the host site was serving malware to users, Google (GOOG) has removed a controversial photo of First Lady Michelle Obama from Google Image Search. The site itself, however, remains listed in Google web search results without any visible malware warning.

Welcome to the murky world of free speech, politics, and Google.

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China’s military is under attack. At least its Web site is…from hackers.

In a sign that China’s Ministry of National Defense faces the same kind of Internet security challenges that militaries around the world have reported, its new Web site was attacked more than 2.3 million times within a month of its August launch. The state-run People’s Daily newspaper reported that revelation Wednesday in an interview with the editor-in-chief of the Chinese defense department’s site, Ji Guilin.

In the report, Ji said it battled down a variety of hackers and no harm was done to China’s national security. He said the site has boosted its network security.

He didn’t say where the hacker attacks originated.

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The use of peer-to-peer networks for sharing files has come under fire during recent months, including the dismantling of Swedish BitTorrent site Pirate Bay, but it turns out even members of Congress need to be kept in check over their file-sharing practices.

Congress on Tuesday introduced the Secure Federal File Sharing Act, which would restrict the use of peer-to-peer file sharing software like Limewire among federal employees.

The new legislation follows multiple embarrassing leaks of sensitive government information by means of open file sharing networks, including the location of a safe house for the First Family, financial files belonging to Supreme Court Justice Stephen Breyer, the electronic schematics to President Obama’s helicopter, and a list of 30 lawmakers currently under investigation by the House Ethics Committee.

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California created the nation’s first energy-efficiency standard for television sets, arguing that it needed to act because federal energy officials have been slow to confront the issue.

Under the standard adopted Wednesday by the California Energy Commission, no TV with a screen size less than 58 inches may be sold in the state after 2011 unless it meets limits on energy consumption. The standard tightens further in 2013. (Larger screens were left for future examination.)

Sets sold in California under the standard would consume 33 percent less electricity in 2011 and 49 percent less in 2013 than the average set sold today, according to the commission. The standard replaces a rule that only considered energy use when sets were in standby mode.

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Federal regulators are considering whether the government should take greater control of the Internet and ask consumers to pay higher phone charges in order to provide all Americans with cheaper access to broadband Internet service.

The Federal Communications Commission Wednesday will lay out the case for expanding broadband Internet service, outlining current obstacles to making it widely available. The agency is considering whether to force Internet providers to share their networks with rivals and raise fees charged on consumer phone bills to pay for the broader access.

The proposals, which have sparked criticism from telecommunications and cable companies, represent a reversal from the Bush Administration, when regulators cut back on government control of Internet and telephone service.

The new commission, controlled by Democrats, is considering whether more government control is needed to ensure competition and more affordable Internet service.

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China’s factories have long churned out high tech products. A big question facing Silicon Valley–underscored in a survey released Monday by Intel (INTC) and Newsweek–is how big a role the country will play in dreaming up those gadgets.

The survey found optimism among Chinese respondents and pessimism among the Americans. Some 63 percent of Chinese believe their country will overtake the United States in technology innovation over the next 30 years. Only one-third of Americans believed the U.S. would still lead over that period.

Justin Rattner, Intel’s chief technology officer, agrees that China will reduce the innovation gap with America. But that doesn’t mean that surpassing the U.S. is inevitable. “Speaking personally, there’s no reason for that to happen,” he said.

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On the first day that the Internet Corporation for Assigned Names and Numbers opened registration for non-Latin script domains, Egypt says it has seized the opportunity to register the first all-Arabic domain name.

Information Technology Minister Tarek Kamel said at a U.N. sponsored Internet conference that his government had filed an application to register the domain “.masr”–or “.Egypt”–written entirely in Arabic, according to the Associated Press. ICANN chief executive Rod Beckstrom said so far six countries submitted applications for domains in three languages, AP reports.

Not everyone thinks the groundbreaking move deserves fanfare–Reporters Without Borders said it finds it “surprising and disturbing” that Egypt is playing host to the Internet Governance Forum. “It is astonishing that a government that is openly hostile to Internet users is assigned the organisation of an international meeting on the Internet’s future,” the advocacy group said in a statement.

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China’s bloggers are a focus of organizers of the President Barack Obama’s upcoming visit, echoing similar efforts by the administration to use social-media tools to communicate with Americans.

On Thursday, U.S. State Department officials held simultaneous press briefings for a select group of predominantly Chinese bloggers in Beijing, Shanghai and Guangzhou, giving a rundown of the U.S. president’s China schedule and took questions from the bloggers.

The attendee list included many influential bloggers, such as journalist Michael Anti, who blogs about freedom of the press, and Rao Jin, whose Anti-CNN Web site scrutinizes China coverage by the news network and other foreign media.

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Efforts to reform the U.S. health-care and bank lending systems are likely to lead to an increase in information-technology spending, said one potential beneficiary, Sudhakar Ram, chairman of IT firm Mastek.

Overhauling the country’s IT systems could cost as much as $250 billion to $300 billion over five to seven years, he said in an interview. In addition, he estimated that electronic health records will cost some $150 billion to $200 billion under the Obama administration’s health-care initiatives ($20 billion of stimulus funds have already gone toward the project).

Stronger systems might have mitigated last year’s economic turmoil, Mr. Ram said. “The subprime crisis started with poor controls at the loan origination process, which a halfway decent loan-origination system should have trapped,” he said. “The core systems are several decades old and written in outdated programming languages.”

That’s like blaming superhighways for traffic jams, said Andrew Bartels, an analyst at Forrester Research (FORR) who studies tech-spending trends.

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In 1993, a tech consultant named Peter de Jager wrote an article for Computerworld with the headline “Doomsday 2000.” When the clock struck midnight on 1/1/00, he wrote, many of our computers would lose track of the date, and very bad things would happen as a result.

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Painting the Golden Gate Bridge yellow might cause less fuss than trying to install a wind farm off Cape Cod’s historic coast.

But when you’re trying to build where the wind is strongest or the sun is brightest, you never know what obstacles you may run into.

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In 1990, Bavarian actor Walter Sedlmayr was brutally murdered. Two of his business associates were convicted, imprisoned for the crime, and recently paroled. Who killed Sedlmayr?

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Can the U.S. government secretly subpoena the IP address of every visitor to a political website? No, but that didn’t stop it from trying.

In a report released today, EFF Senior Staff Attorney Kevin Bankston tells the story of a bogus federal subpoena issued to independent news site Indymedia.us, and how the site fought back with EFF’s help. Declan McCullagh at CBSNews.com also has the story.

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The China Internet Illegal Information Reporting Center has released the latest list of “vulgar content” offenders (in Chinese). This time, Google (GOOG) escaped mention–but Yahoo (YHOO) China and a popular real-estate portal, Soufun, did not.

The list referred to user-generated content on a section of Yahoo China’s Web site called “Yahoo Space,” which is not currently in operation. But a subsequent notice released today by the center said remnants of the “vulgar” content from Yahoo Space could still be found in other parts of Yahoo’s portal.

The Web sites “didn’t continue to follow the government’s call to effectively crack down on vulgar content and information on the Internet, and relaxed supervision of their Web sites, which ultimately led to the appearance of a lot of vulgar content, which is against social morals and does harm to the physical and mental health of the youth,” the center said in a notice. “Such behavior…has led to the anger of our public and should be strongly condemned.”

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