Thursday, 03 March 2005 18:00

News Roundup 3 Mar 2005


Fiorina candidate for World Bank

Carleton S. Fiorina, who lost her job as chief executive of Hewlett-Packard almost three weeks ago, has emerged as a strong candidate to become president of the World Bank, according to an official in the Bush administration.

The New York Times reports (2 March) that Paul D. Wolfowitz, the US deputy secretary of defense, was also under serious consideration, according to the official, who refused to be identified because discussion about the candidates is continuing.

The NYT says, however, that the Defense Department insisted on Tuesday that Mr. Wolfowitz would remain in place as deputy secretary of defense.

The paper says the decision rests on several factors, including the results of consultations with members of the World Bank, politics within the Bush administration and a closer scrutiny of the candidates.

By tradition, the United States chooses the head of the World Bank while the Europeans select the director of the International Monetary Fund. The countries left out of the process would like that changed, says the NYT.

With this choice, President Bush would have a chance to name his own person to be the spokesman for the world's poor. Increasingly, Mr. Bush has pushed to put his mark on foreign aid policy, stressing help for countries meeting his criteria for responsible government. In the new budget proposal, foreign aid was spared the deep cuts made in many domestic programs.

The NYT says that Ms. Fiorina, the only woman on the list, carries far less political baggage than Mr. Wolfowitz and has a reputation for dynamic leadership. As the head of a Fortune 500 company for six years, she gained executive experience that put her near the top of the list for the job. She would also add glamour as probably the only candidate famous enough to be widely known by her nickname - Carly.

Qwest questions Verizon's MCI bid

The New York Times reports (2 March) that Verizon Communications would and should face serious regulatory hurdles in its bid to acquire MCI, Richard C. Notebaert, the chief executive of Qwest Communications, told investors yesterday.

The paper says Mr. Notebaert made his remarks in New York as part of an effort to persuade Wall Street investors and analysts that MCI would be better off rejecting Verizon as a suitor and accepting Qwest as a merger partner.

In letter released yesterday, the board of MCI sought to assure Mr. Notebaert that it had given fair consideration to Qwest's takeover bid, the paper reports.

The NYT says that two weeks ago, the MCI board agreed to accept a US$6.75 billion acquisition offer from Verizon Communications. In doing so, it rejected an US$8 billion offer from Qwest, after determining Qwest was a less financially stable suitor.

Qwest subsequently sweetened its offer, reports the NYT., by changing the terms of its US$8 billion bid, offering, among other things, to protect MCI shareholders from short-term risk. MCI has been an alluring takeover target because it has a strong presence selling telephone and internet services to corporate customers, says the paper.

The paper says that MCI has come under pressure from its major shareholders in recent days to both consider Qwest's offer and to acknowledge publicly that it is doing so.

According to one industry executive, who said he supported Verizon's takeover bid, a Qwest and MCI merger could also represent a regulatory problem because it would combine two major long-haul networks into one, the NYT reports.

Microsoft pulling back from sports video game market

Microsoft will stay out of the sports video game market for now, except in racing, leaving most of the category to other publishers, the head of Microsoft Game Studios said on Tuesday, and reported by the New York Times/Reuters (1 March).

On Monday Microsoft said it sold the assets of its team sports games -- baseball, basketball, football and hockey -- to French publisher Ubisoft (UBIP.PA). It had previously sold the studio and assets behind its tennis, golf and snowboarding games to Take-Two Interactive Software Inc.``We made a decision almost a year ago to reevaluate what we were doing in sports. Frankly, we weren't delivering at the kind of quality we needed for our customers and to compete effectively,'' Shane Kim told Reuters.

While terms of the Ubisoft deal were not disclosed, Kim said it did not leave Microsoft an opening to reuse the intellectual property in question.

The NYT says representatives for Ubisoft were not immediately available for comment. The deal marked the company's entry into the sports video game market, which has grown more crowded of late.

The paper says that Kim did not rule out a return to sports on future hardware platforms. Microsoft is universally expected within the games industry to release a new version of the Xbox this holiday season.

Sony increasing PSP shipments to US

Sony will put 1 million PSP portable video game players on North American retail shelves for its 24 March launch, the company said on Tuesday, a figure double what some analysts had expected, reports The New York Times/Reuters (1 March).

The paper/Reuters report that Sony Computer Entertainment of America had previously said 1 million PSPs would be manufactured for North America by 31 March, but it acknowledged many of those units would be spread around the supply chain, from factories to distribution to warehouses.

The PSP launched in Japan last December and remains in extremely limited supply there, says the NYT/Reuters report, having shipped nearly 1.2 million units to date. Sony maintained its forecast for shipping 3 million PSPs worldwide by the end of its fiscal year in March.

The NYT/Reuters say that a spokesman for SCEA, Sony's video game business in the United States, could not immediately say exactly what Sony was doing to meet increased demand. Last year, when its PlayStation 2 console was in short supply, Sony resorted to shipping the units to the United States from China via air freight, a costly option that cuts into margins, adds the paper/Reuters.

The PSP is Sony's first major venture into handheld video gaming, a market dominated since 1989 by Nintendo and its Game Boy line, reports the NYT/Reuters.

Anti - piracyware costs threatens open standard

A handful of technology companies are overcharging for anti-piracy software needed for digital music stores on the internet, preventing the emergence of open standards, electronics goods makers have said, reports The New York Times/Reuters (2 March).

The NYT/Reuters report that several consumer electronics makers balk at the US$1 charge for anti-piracy technology proposed by the Open Mobile Alliance (OMA). The OMA is a group of handset makers, wireless telecoms operators and other technology companies.

Mobile phone makers and consumer electronics makers said US$1 per device is too high a price only to protect music and video against illegal copying, says the NYT/Reuters. and they will not be able to recoup that money through revenues expected from digital entertainment.

One senior executive at a top five mobile phone maker, who declined to be named, told the NYT/Reuters thatlast year alone 684 million mobile phones were sold. If handset makers had put anti-piracy protection software in those phones, the US$684 million in royalties would have exceeded total digital music sales on the web last year.

The NYTY/Reuters report say that the man in charge of the OMA's anti-piracy working group which has put together the open standard, stresses the technology itself has been accepted by all. The problem lies with the price charged by the companies which own the patents.

The issue is particularly delicate, says the NYTY/Reuters, because it emerges one week after a surprise opening up of music technology companies related to Microsoft's and Sony's online music stores. They would both support the OMA's standards for music compression and piracy-protection technology.

The paper and Reuters say it was seen as an industry breakthrough, and a victory for consumers who would not be restricted to a small set of portable music players, such as Apple's iPods for iTunes tracks.

Bill Gates receives honorary knighthood

Proclaiming himself "humbled and delighted," Microsoft founder Bill Gates has received an honorary knighthood the Queen -- an accolade that allows the recipient to use ``KBE'' after his name, but not to put ``Sir'' in front of it, reports The New York Times/AP (2 March).

The paper says one of the world's richest men, Gates, 49, was being honored for his charitable activities around the world and his contribution to enterprise in Britain.

Past recipients of the honorary knighthood range from Irish singer Bob Geldof to former US President Ronald Reagan, says the paper.

The NYT says Gates joins a roster of American knights that includes former presidents Reagan and George H.W. Bush, comedian Bob Hope, retired US Army Gen. Tommy Franks and former Secretary of State Colin Powell.

Gates said he was proud of what he called Microsoft's ``special relationship'' with Britain, reports the paper, with Gates addig that "the UK was the first country in which Microsoft set up a subsidiary outside the US., and our experience in the UK has been significant in shaping our international growth,''

Big Blue goes after the little guy

IBM is going after small and medium businesses and the white box server vendors who serve them, says The Register in a 2 March report

The Register says that IBM, talking at the company's Partnerworld conference in Las Vegas, said the Small and Medium Business market was growing faster than other markets and IBM had to do better in that market.

According to The Register, Big Blue will aim to compete with white box vendors(no-brand boxes) with its Blade servers and newly-announced X3 boxes.

In not unrelated news, the Register says IBM announced a $300m spend on helping resellers go after the SMB market. SMB customers already provide more than 20 per cent of IBM's revenues. IDC estimates the SMBs will spend $360bn in 2005 on IT.

IBM consultants will partner with regional systems integrators in Europe and the US. IBM will offer preconfigured mySAP solutions targetted at smaller firms. Partners in the US will be able to resell IBM hosting services to SMB clients, reports The Register.

Open Office 2.0 beta here

The Register reports (2 March) that a beta version of Open Office 2.0 is available for download, saying that the open source office applications suite claims to offer most of the functions of Microsoft's Office product, and includes word processing, spreadsheet, presentation and drawing software.

The publication says that the beta has a new user interface - designed to make refugees from Microsoft Office feel at home, according to NewsForge. It also improves interoperability with Microsoft file formats. The site warns that the software needs further testing and is offered with "no guarantees".

The Register adds that most new features are in the Writer programme, including word count for selected text, wizards for setting up databases and tables and floating toolbars.

EDS wins UK defence contract

Services behemoth EDS has won a £4billion contract to sort out technology for the UK Ministry of Defence, in deal which covers everything from civil service desktop machines to battlefield communications, reports The Register (2 March.).

The Register says that the ATLAS consortium, led by EDS, had been awarded "Increment 1" - the first stage of the contract worth £2.3bn. Further increments are expected to follow in due course.

The publication says the procurement process boiled down to two groups: EDS and CSC's Radii group.

The contract calls for the replacement of various systems with one integrated network which will interoperate between the MoD and its allies.

According to The Register, the win will help counter concerns that EDS struggles with big defence contracts. The firm's deal with the US Navy was valued at $8bn but has already cost the firm $500m in written off assets.

Battle in Poland over telecom control

A dispute between major French and German companies over the ownership of a Polish mobile telephone company has led to new managers being barred from the building, and the loser in the dispute is demanding Polish prosecutors protect its interest.

The New York Times reports (2 March) that the dispute pits major companies in two founding members of the European Union as they jockey for position in the largest country to join the union last year.

The paper says the loser in the Polish courts so far is the French company, Vivendi Universal. Vivendi said on Monday that it had filed a complaint under a 1989 agreement between Poland and France aimed at encouraging bilateral investment. Vivendi said Deutsche Telekom and Elektrim, a Polish utility, had conspired to take its stake in the telephone company, Polska Telefonia Cyfrowa, or P.T.C.


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Stan Beer


Stan Beer co-founded iTWire in 2005. With 30 plus years of experience working in IT and Australian technology media, Beer has published articles in most of the IT publications that have mattered, including the AFR, The Australian, SMH, The Age, as well as a multitude of trade publications.



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