Microsoft has changed its mind, again, as to whether the "iloo" was a real project or not. Lisa Gurry, from MSN said: "We jumped the gun basically yesterday in confirming that it was a hoax, and in fact it was not."

The project has been binned by MSN, but the original news was not a hoax, the plans exist. Internal investigations will look into the confusion surrounding the "iloo" story.

Gurry said: "Definitely, we're going to be taking a good look at our communication processes internally. It's definitely not how we like to do PR at Microsoft."