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Steps:
1) Make sure you have Java 7 Update 10. If not, you can upgrade.
2) Go to the Java control panel.
3) In the Security tab, de-select “Enable Java content in the browser.”
Or you can uninstall any versions you have through Windows’ Control Panel.

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Oracle is not actually covering itself with glory here.
That $7.3 billion invested in Java looks a bit shaky today.
The real problem is that pretty much the entire foundation of what we use is based on ideas of the 1960s (even windows and mice; graphics were an obvious addition to that done in the early 70s).
As long as we depend on stuff like that, e.g. Sun/Oracle’s Hotspot Java implementation is a barely maintainable mishmash of C++ and assembly language (i.e. very dangerous to work with stuff), we’ll continue to have security problems like this.
It’s my opinion that until a software error kills thousands of people we won’t see real reform here, sort of like how it took a bunch of steam boiler explosions for people to get their act together.