Thursday, 21 April 2005 17:30

News Roundup 21 April 2005


Intel profit up sharply on demand for chips

Intel, the biggest maker of semiconductors, has reported that profits rose about 25 percent in the first quarter on high demand for chips for notebook computers and mobile devices. The strong showing beat Wall Street's forecasts and quelled some investor concern that the technology sector was experiencing another slowdown.

The New York Times reports (20 Apr.) that Intel's upbeat report came less than a week after IBM disappointed investors with quarterly earnings that fell short of analysts' expectations and the company's own projections. IBM's poor performance dragged down the market and seemed to signal weak demand in corporate technology spending.

The NYT said that Intel executives assured investors that the company was seeing no such slowdown in demand, and expressed confidence in global economic conditions.

Intel's earnings report, which along with IBM is considered a bellwether of the technology sector, came after the close of regular trading. Shares of Intel rose 42 cents, to close at US$22.63, then rose nearly 6 percent in after-hours trading, reported the NYT.

The newspaper said Intel executives attributed the company's strong results to increased sales of higher-priced chips used in notebook computers, wireless networks and cellular handsets.

The company reported net income of US$2.15 billion, or 34 cents a share, compared with US$1.73 billion, or 26 cents a share, in the first quarter last year. Analysts had forecast earnings of 31 cents a share on sales of US$9.31 billion, according to Thomson Financial.

The NYT reported that Intel's revenue rose 17 percent over last year, to US$9.4 billion, from US$8.1 billion. The first quarter includes an extra week, though company executives said that they were unable to estimate its impact on the quarter.

The newspaper says Intel's report also came only days after Advanced Micro Devices, Intel's leading competitor, posted a loss for the first quarter from poor sales in its flash memory chip business.


Yahoo profit soar with user gains
Yahoo, the big internet portal, has said that its profit doubled in the first quarter, as its audience grew rapidly and advertising sales grew even faster.

The New York Times reports (20 Apr.) that Yahoo reported that 372 million people visited its network of sites in the quarter, up 36 percent from a year ago. Yahoo asserts that 13 percent of time spent online is spent on its search, e-mail and other services.

As a result, the company has been a primary beneficiary of the increased interest among advertisers in using the internet, both for text ads on Web searches and in more elaborate graphical advertising, says the NYT.

The newspaper reports that Yahoo earned US$205 million in the first quarter, up from US$101 million a year earlier. That comes to 14 cents a share, including a penny a share from investment sales and legal settlements. Analysts had expected Yahoo to earn 11 cents a share.

Yahoo's total revenue was US$1.17 billion, up 55 percent from a year ago. Analysts like to look at Yahoo's revenue after deducting the payments it makes to sites that carry its ads, like Microsoft's MSN search service. On that basis, Yahoo's revenue was US$821 million, higher than the US$797 million that analysts expected, reports the NYT.

The NYT says the company's international growth was especially vigorous. The company's revenue outside of the United States was US$355 million, up 124 percent. Its domestic revenue was US$819 million, up 37 percent.


Good tech results: investors giddy, for now

A round of more positive earnings news from leading technology names -- led by bellwether Intel -- put investors in a giddy mood on Tuesday, but the relief may still prove short-lived, reports Reuters in a New York Times report (19 Apr.).

The Reuters/NYT report says that rather than convincing investors that the business climate is improving, the latest results could provide more limited comfort that technology spending has not fallen off a cliff, as some feared after IBM's surprise earnings shortfall last week.

The report says that on a buoyant day for technology stocks, the Merrill Lynch technology index rose 1.65 percent to 286.65, as 89 out of 100 components closed in positive territory ahead of Intel's results. But highlighting the turmoil within technology stocks, the index remains 13 percent lower for the year-to-date.

The NYT says IBM, the world's largest computer company, shocked an already worried Wall Street with slumping results that it blamed on weak spots in the global economy and its own problems in closing business deals. Other global names like Samsung and Infosys have listed their own woes. Revenue reached the second-highest level in the company's history, driven by strong sales of chips for wireless notebook computer chips. In a measure of confidence, Intel boosted capital spending plans on new equipment by nearly 10 percent.


Opera software upgrades hacker defenses

Better security and the automatic scaling of web pages to fit screens of any width are among the features included with a new browser released by Opera Software.

The New York Times and Associated Press report (20 Apr.) that, in version 8 of Opera, a security information field automatically starts when a user visits a secure Web site, indicating the level of security on a scale of one to three and showing who owns the security certificate.

The NYT and AP say that this way, surfers can evaluate the trustworthiness of banking and shopping web sites and minimise the risk of phishing attacks, in which scammers send e-mail tricking recipients into revealing credit card numbers and other sensitive personal information.

The paper and AP report that the new browser version can be downloaded for free with advertising for the Windows and Linux operating systems. An ad-free version costs US$39. Opera also released a test version, or ''beta,'' for Mac OS computers.

The report says that Opera 8 rearranges web pages as necessary so web surfers can view them within narrower windows without having to slide a horizontal tab. This feature is particularly useful for the small screens of mobile phones; Opera sees such devices as a growth potential.

The browser also allows voice commands to the computer and having the machine read pages aloud, though the feature is only available in English and for the Windows 2000 and XP operating systems, rteport the NYT and AP.

According to the paper and AP., Opera commands less than 0.2 percent of the Windows market, behind the industry leading Internet Explorer from Microsoft and various browsers based on the Mozilla Foundation's open-source code, according to tracking by WebSideStory., Marks & Spencer deal

Amazon Services Europe, a unit of online retail giant, has said it will host a web site for British clothing retailer Marks & Spencer, as well as service the company's in-store and telephone ordering and customer services systems.

The New York Times/Associated Press report (19 Apr.) that financial terms weren't disclosed. Marks & Spencer will remain responsible for the management of its web site, customer service operations, warehousing and distribution.

The company said it already has a successful web site with over 24 million visits every year, but its e-commerce and customer ordering capabilities have yet to reach their full potential. M&S said a partnership with Amazon will help it achieve this, while allowing the company to concentrate on its core business of retailing, report the NYT and AP.

The paper and AP say that the alliance with Marks & Spencer marks Amazon Services' entrance into the European business retail services market. In the US., Amazon Services powers the e-commerce channels for Target,, Toys R Us, Bombay Co., Diane von Furstenberg, and CD Now.


Rival web services specs destined for OASIS

Uncertainty surrounds the future of separate initiatives for web services reliability, after Microsoft and IBM announced they will submit a jointly authored specification to OASIS.

The Register reports (20 Apr.) that Microsoft and IBM are to submit WS-ReliableMessaging to OASIS with the backing of 14 companies and organisations.

According to The Register, WS-RM is the latest milestone in the companies' slowly unfolding WS- roadmap, outlined in 2002. This particular specification was also co-authored with BEA Systems and Tibco Software.

The proposed specification, though, would join a pre-existing standard covering reliable web services messaging that is already firmly established at the Organisation for the Advancement of Structured Information Standards (OASIS), says The Register.

The Register further reports that Web Services Reliability 1.1 has already been developed with the backing of Sun, Oracle, NEC, Hitachi and Fujitsu. Sun, a long-time critic of Microsoft which last year buried its hostility towards the company in a broad-ranging legal settlement, has also expressed its support for WS-RM.

According to The Register, news of the rival specifications is the latest twist in a saga that has run for the best part of four years. This has seen Microsoft and IBM push their own web services standards agenda while various consortia have developed their own parallel specifications.


Less Office, more family for Microsoft DSI program

Microsoft is switching gears on its autonomic computing strategy with plans for a suite of Windows server and systems management products, according to The Register (20 Apr.).

The Register reports that, speaking on the two-year anniversary of its Dynamic Systems Initiative (DSI), Microsoft said the planned System Center product will now become the "overarching family name" for its systems management products rather than an "independent product".

The suite will include the popular Microsoft Operations Manager (MOM) 2005 and Systems Management Server (SMS) 2003, and three new products, The Register reports.

The UK online news service says that Microsoft said it this year plans System Center Reporting Manager 2005, System Center Data Protection Manager 2006, and System Center Capacity Manager 2006.

The Register says Microsoft is also taking an IBM-style approach to server and systems management, with plans to encapsulate knowledge about workflows across System Center. According to the company, customers will receive change and configuration best practices in SMS and greater operational knowledge in MOM.


UK court orders ISPs to reveal IDs of filesharers

A British judge has ordered five ISPs to name another 33 music file sharers. The individuals concerned had uploaded more than 72,000 music files to the internet, according to a statement by the BPI (British Phonographic Industry), which sought the court order as part of its broader legal offensive against illegal downloading on P2P networks.

The Register reports (19 Apr.) that the ISPs concerned have two weeks to give the UK record companies' trade association the names and addresses of the file sharers. The case brings the number of people in the UK to face legal action for illegal file sharing up to 90. These people will face claims for compensation and the legal costs in pursuing them, the BPI warns.

According to The Register, more details of the 31 people subject to the BPI's last round of writs in March 2005 also emerged. Around a third of these defendants are thought to be parents whose accounts have been used to upload music illegally by their children. Eleven of the 31 are from London and the South East. Another file sharer hails from Norfolk while five are from the West Country. Two of the file sharers live in the Midlands, with five from the Yorkshire and the North West. Two of the file sharers are from Northern Ireland, three from Scotland and two from Wales.

The Register says that a new study commissioned by the BPI shows the supposed extent of the damage that illegal file sharing is doing to the UK recording industry. A two-year study, carried out by research group TNS, on the effect of illegal file sharing on consumer spending in the UK found the downloaders spent a £654m less on recorded music over the last two years than otherwise be the case.


DSW data theft larger than estimated

In the US., thieves who accessed a DSW Shoe Warehouse database obtained 1.4 million credit card numbers and the names on those accounts -- 10 times more than investigators estimated last month.

The New York Times/Associated Press report (20 Apr.) that DSW Shoe Warehouse has said that it has contact information for about half of those people and started sending letters notifying them of the thefts, which happened at 108 stores in 25 states between November and February.

The company, a subsidiary of Retail Ventures, announced the thefts last month after notifying US federal authorities and credit card companies. At the time, the Secret Service said only that information involving more than 100,000 people had been compromised, the AP/NYT report says.

Wednesday, 20 April 2005 17:30

News Roundup 20 April 2005


RIM's growth in early stages says CEO

BlackBerry maker Research In Motion may just be in the early stages of its growth even though its wireless e-mail device is now the world's most popular, its co-chief executive said on Monday.

The New York Ties and Reuters report (18 Apr.) that RIM Co-CEO Jim Balsillie said he believes growth prospects are strong because wireless data is by far the best way for companies to improve productivity.

Launched in 1999 and known for its distinctive thumb-operated keyboard, the original BlackBerry helped RIM carve out a lucrative niche in the wireless market, report the NYT and AP.

Balsillie told AP that the Ontario-based firm was on track to reach 3 million subscribers. The company added 470,000 subscribers in the fourth-quarter to reach about 2.51 million as of 26 Feb.

He noted the company, whose device is offered by about 100 wireless phone companies, is looking to double that number this year.


Microsoft expands messaging, partners RIM

Microsoft will expand the availability of its corporate instant messaging software to mobile devices and cell phones, the world's largest software maker said on Monday.

The New York Times and Reuters reportr that Microsoft said it would also partner with BlackBerry maker Research In Motion so that users of the popular wireless e-mail devices can send and receive instant messages as well.

The paper and Reuters say that such products are aimed at office workers who need to send instant text messages without having to sit in front of a desktop or a notebook personal computer, but also want the ability to keep such communications secure and available for later retrieval.

Microsoft is betting demand for corporate instant-messaging and Web-conferencing products will increase as companies encourage employees to work together remotely, rather than in face-to-face meetings that can involve costly business travel, says the paper and Reuters.

According to the NYT/Reuters report, Microsoft said the mobile version of its recently upgraded instant messaging program for businesses, called Microsoft Office Communicator, will be available in the second half of 2005. The software can track whether users are online and allow them to swap text messages between phones or between a cell phone and a PC.


GameStop to acquire Electronics Boutique

Video-game retailer GameStop has agreed to buy rival Electronics Boutique Holdings for about US$1.4 billion in cash and stock, creating a chain of about 3,800 stores worldwide.

The New York Times/Reuters report (18 Apr.) that the sale price reflects a 34 percent premium over Electronics Boutique's closing stock price on Friday.

The paper and Reuters report that the deal would combine two companies of similar size and sales. GameStop operates about 1,800 stores and had revenue of US$1.84 billion in its last fiscal year. Electronics Boutique, runs about 2,000 stores and had sales last year of US$1.99 billion.

GameStop chairman and chief executive R. Richard Fontaine said the acquisition would let his company enter new international markets and compete better in the hard-fought US video-game business. He said GameStop planned to continue its aggressive store growth plans, report the NYT and AP.

The NYT and AP say that the combined company will have annual revenue of about US$3.8 billion and more than 3,200 U.S. stores and nearly 600 stores in Canada, Europe, Australia and New Zealand.


EMC releases NAS system

The Register reports (18 Apr.) that EMC has just rattled the storage world by releasing one of the highest-end NAS (network attached storage) systems on the planet. Along with the hardware, EMC also rolled out a number of software upgrades meant to make managing large volumes of data easier, says the UK online publication.

The Register says that,with the Celerra NSX box, EMC feels pretty confident that it has won the "my NAS gateway is bigger than yours" contest over rivals such as Network Appliance and IBM. When fully equipped, the Celerra NSX holds 8 of what EMC is calling its X-Blade servers, which allows it to crank out a whopping 300,000 NFS (network file system) operations per second. Customers will also find 112TB of storage in a maxed out configuration, according to the publication.

"This is the reaffirmation that EMC owns the high-end of the NAS market," Tom Joyce, a vice president of marketing at EMC, told The Register.

The Register says that EMC has spent the last few years rounding out its NAS line from top down in the hopes of competing better against swift rival NetApp.

However, The Register says that, while EMC has made large gains, it still trails NetApp in market share according to the latest figures from IDC. The research firm has NetApp taking 37 per cent of NAS sales in 2004 compared with 33 per cent for EMC. The two companies are clearly the dominant players in the market, reports The Register.


US judge dismisses California claims vs Microsoft

A federal judge has dismissed a claim by five California cities and counties that Microsoft, the world's largest software maker, had overcharged them for software.

The New York Times/Reuters report (19 Apr.) that a US District Court Judge , granted Microsoft's motion to dismiss the lawsuit, saying that some of the plaintiffs were not allowed to sue because of their status as municipal corporations and that the statute of limitations had expired on several of the claims.

The paper and Reuters say that the plaintiffs, which included the City and County of San Francisco, city of Los Angeles and the counties of Santa Clara, San Mateo and Los Angeles, sued the software maker last August for violating antitrust and unfair competition laws in California.

A separate class action brought against Microsoft on behalf of 13 million California businesses and consumers was settled in 2003 for US$1.1 billion. Claims would be paid in the form of vouchers that can be used to buy software or hardware, with any unclaimed funds to be used for schools and education, the NYT and Reuters report.


China jails US men in piracy case
A court in Shanghai has sentenced two US citizens to jail terms of up to 2 1/2 years in prison for selling pirated DVDs online in a case China has used to highlight the difficulties of enforcing anti-piracy laws.

The New York Times and Associated Press report (18 Apr.) that Shanghai No. 2 District Court judge Xue Zheng ordered Randolph Hobson Guthrie, 38, to serve a two-year, six-month jail sentence and pay a US$60,500 fine for selling pirated DVDs. Fellow American Abram Cody Thrush, convicted as an accessory, was sentenced to one year in prison and fined US$1,200.

According to the NYT and AP., the four people on trial were accused of using the internet to sell more than 180,000 counterfeit DVDs to buyers in 25 countries. Officials said about 20,000 of the DVDs were sold to American buyers.

Both men were ordered to be deported after serving their sentences.

The NYT and AP say that China has stepped up enforcement of laws against rampant bootlegging of DVDs, CDs and other intellectual property, under pressure from the United States and other trading partners. State media pointed to the case as an example of how foreigners are involved in the trade of pirated products.


Jap. takeover battle settled

A contentious Japanese takeover battle has ended amicably as an internet start-up, Livedoor, agreed to sell most of its stake in the target radio broadcaster to a rival bidder, the Fuji Television Network.

The New York Times reports (19 Apr.) that, under the agreement, Fuji TV will take a 15 percent stake in Livedoor to seal what the companies say is now a friendly alliance.

The paper says the accord ended a two-month struggle for control of the Nippon Broadcasting System, a small operation that had long been an affiliate of Fuji TV until Livedoor surreptitiously bought up much of its equity.

According to the NYT., the battle has intrigued Japan, where unfriendly takeover attempts are extremely rare. It also set off alarm bells in boardrooms throughout the country, prompting many companies to adopt steps to avoid becoming fodder for hostile takeovers themselves.

The NYT reports that Livedoor, an internet services company run by Takafumi Horie, 32, said that it would sell a 32.4 percent stake in Nippon Broadcasting to Fuji TV, Japan's largest private broadcaster, for 67 billion yen (US$623 million), or 6,300 yen a share. That is about the average price Livedoor paid for the shares in Nippon Broadcasting it built up over the last two months, analysts said. Nippon Broadcasting shares fell slightly more than 1 percent on Monday, says the paper.

The paper further says that after the sale, Fuji TV's stake in the broadcaster will rise to 69 percent. Livedoor will become the second-largest shareholder in Nippon Broadcasting with an 18 percent stake.

The companies also said that Fuji TV would pay the equivalent of US$409 million to buy new shares that will give it a 15 percent stake in Livedoor, an internet service provider, the NYT reports.


Philips Electronics poor Q1 result

Overcapacity in chips and liquid-crystal displays depressed first-quarter profit at the Dutch electronics group Philips Electronics, sending its shares as much as 4 percent lower on Monday.

The New York Times and Reuters report (19 Apr.) that the company's net profit at the lighting maker and Europe's top consumer electronics producer was 117 million euros (US$152 million), compared with analysts' expectations of 156 million euros. In the year-earlier period, net profit was 550 million euros, increased by results from unconsolidated companies at Philips, which is also a big maker of hospital equipment and Europe's third-largest semiconductors maker.

The paper and Reuters report that, this quarter, however, the sizable stakes held by Philips in companies like South Korea's flat-panel maker LG.Philips LCD and the Taiwan contract chip producer TSMC turned in only 22 million euros, compared with 457 million a year earlier and analysts' expectations of 50 million, as selling prices of their products slipped because of overcapacity.
Some Verizon customers to get stand-alone DSL

In the US., Verizon Communications has said that it would allow current customers in 13 Northeast states to drop telephone service but continue to get high-speed internet access through digital subscriber lines.

The New York Times reports (19 Apr.) that Verizon characterised the new policy, which took effect yesterday, as a first step toward offering stand-alone DSL services in all regions where it operates.

The paper says that consumer advocates, and some legislators and regulators, have criticised the US's major telephone companies for failing to offer stand-alone DSL., which would allow consumers to buy high-speed internet services without having to pay for phone service.

The critics argue that the companies, desperate to hang on to phone customers, are unfairly limiting consumer options, says the NYT

The NYT says that of the four major US phone companies - BellSouth, SBC Communications, Verizon and Qwest Communications - only Qwest has offered stand-alone DSL.

In the change just announced, Verizon said it would offer stand-alone DSL., but only to existing customers and only if they agreed to move their landline phone number to a wireless carrier or to a company that offered Internet-based telephone service, like Vonage or a cable company, the NYT reports.


AOL deal to use Universal videos

Amid pressure from the Universal Music Group, America Online has struck a deal to pay for the use of Universal's music video libraries for its online service, people involved in the deal said.

The New York Times reports (19 Apr.) that the licensing agreement, expected to be announced now, sets a potentially lucrative precedent for the music industry in the evolution of online and video-on-demand business. The major record companies have been trying to avoid a repeat of what they think was a costly error in the early 1980's, when they agreed to provide videos free to a fledgling MTV.

The paper says the deal comes more than two months after Universal Music, the world's biggest record company and a unit of Vivendi Universal, demanded that online services and cable companies agree to new financial terms for the use of music videos or remove the clips from their on-demand services. AOL and Yahoo have both had to remove Universal's videos from their offerings.

According to the NYT., Universal is close to a similar arrangement with Yahoo, which runs the most popular online video service. AOL, a unit of Time Warner, was now trying to complete a deal with the privately owned Warner Music Group, and may announce it today.

For AOL, the deal with Universal provides access to thousands of videos at a time when it is trying to expand its offerings in advance of a major shift, expected this summer, when more of AOL's service will be available free, the NYT reports.


Texas Instruments' increase of 12% in Q1 income

Texas Instruments, whose processors run more than half the mobile phones sold last year, said yesterday that first-quarter net income rose 12 percent and profit might exceed analysts' estimates this period.

Bloomberg News said in the New York Times (19 Apr.) that Texas Instruments' net income increased to US$411 million, or 24 cents a share, from US$367 million, or 21 cents, a year earlier.

Analysts had expected Texas Instruments to earn 23 cents.Sales rose 1.2 percent, to US$2.97 billion, from US$2.94 billion, the Dallas-based company said.

The Bloombergs/NYT report says that the increased profit forecast by Texas Instruments might help allay some investors' concerns about demand for consumer electronics products, coming after disappointing results from IBM. and Samsung Electronics.

According to Bloombergs and the NYT.,Texas Instruments said profit this quarter would be 25 cents to 29 cents a share on sales of US$3 billion to US$3.24 billion. Analysts expected 26 cents, the average of 33 estimates in a Thomson Financial survey, on sales of US$3.17 billion. The company had net income of 25 cents and sales of US$3.24 billion in last year's second quarter.


Qwest protests phone merger

In the US telco industry, Qwest Communications has filed the first of an expected series of protests against the SBC Communications-AT&T merger, telling California regulators that the combined company would hurt consumers and businesses.

The New York Times/Associated Press report (19 Apr.) that, in a document made public Monday, Qwest also asked the California Public Utilities Commission to examine the SBC-AT&T merger along with a proposed union of MCI and Verizon Communications.

The paper and AP say that Qwest Communications International, which is based in Denver, plans to file additional protests as other states begin considering the mergers.


LexisNexis warns 280,000 of info breach

In the US., LexisNexis has said that it has begun notifying about 280,000 people whose personal information may have been accessed by unauthorised individuals using stolen passwords and IDs.

The New York Times and Associated Press report (18 Apr.) that, last week, LexisNexis disclosed that criminals may have breached computer files containing the personal information of 310,000 people, a tenfold increase over a previous estimate of how much data was stolen.

The paper and AP report that the company, a subsidiary of London-based publisher Reed Elsevier Group, had previously identified 32,000 potential victims and has notified them already.

According to the report,the first batch of breaches was uncovered during a review and integration of the systems of Seisint shortly after LexisNexis bought the Boca Raton unit for US$775 million in August.

The paper and AP say that Seisint's databases store millions of personal records including individuals' addresses and Social Security numbers. Customers include police and legal professionals and public and private sector organisations.

Reed said it identified 59 instances since January 2003 in which identifying information such as Social Security numbers or driver's license numbers may have been fraudulently acquired on thousands of people, the paper and AP report.

Tuesday, 19 April 2005 17:30

News Roundup 19 April 2005


Adobe buying Macromedia for US$3.4 billion

Computer document company Adobe Systems has said it agreed to buy multimedia software firm Macromedia for about US$3.4 billion in stock, a move designed to extend its lead in the market for creating and distributing digital documents.

The New York Times and Reuters rerport (18 Apr.) that Adobe, best known for its Acrobat document-sharing software, said the deal would help it meet rising customer demand for audio and video options that are compatible with hand-held devices. Macromedia also gives Adobe access to the dominant animated graphics software on the Internet and which is also aggressively expanding into mobile phones.

The report by the NYT and Reuters says that the deal is the latest move in the long-anticipated consolidation of the software sector. It was initially welcomed by industry-watchers.

At the same time, Adobe said second-quarter earnings and revenue would be toward the high end of previous guidance due to strong demand for Acrobat -- more or less in line with analysts' estimates, report the NYT and Reuters.

According to the NYT and Reuters, in March, the company said it expected earnings per share between 51 cents and 55 cents and revenue of between US$475 million and US$495 million. Wall Street is expecting earnings of 54 cents per share, on average, according to Reuters Estimates, and revenue of US$489.8 million.

Separately, Macromedia said it expected net revenue for the fourth fiscal quarter, ended 31 March, to exceed the US$108 to US$113 million guidance it provided in January. Analysts are expecting revenue of about US$111 million.


Microsoft runs massive Windows ad campaign

Even though Windows XP has been on the market for more than three years, Microsoft is hoping a new advertising campaign will "start something" when it comes to enthusiasm for the operating system.

The New York Times/Reuters report (18 Apr.) that the campaign, which will last for 15 months, is designed to showcase all the things Windows can do. The company is also gearing up to celebrate the 20th anniversary of Windows' debut.

The paper and Reuters say that the campaign, which will launch In 11 countries with online, print and television ads, will try to play up Windows as the start to many things. The ads will have messages like "Start something curious," "Start discovering lost cities" and "Start feeding your brain." In all, Microsoft said there are 51 TV spots, 39 print ads and 250 online advertisements.

According to the paper and Reuters, given its time frame, the "Start Something" campaign will serve as a run up to the debut of Longhorn, the next version of Windows, which is set to go on sale by next year's holiday buying season.

A beta, or test version, of Longhorn is slated for this summer (US); developers will get an updated preview version of Longhorn at next week's Windows Hardware Engineering Conference in Seattle.

The NYT and Reuters says that the new ad campaign also comes as rival Apple Computer prepares to launch its next operating system--Mac OS X 10.4 Tiger--which goes on sale 29 April.


US agencies told be brand neutral; AMD cheers

The White House this week told US federal agencies to stop specifying brand names in procurement contracts, a practice it says leads to higher prices for everything from paper clips to personal computers and hurts the livelihood of smaller vendors.

The New York Times/Reuters repport (17 Apr.) that, the memorandum from the White House's budget office, was hailed by Advanced Micro Devices(AMD), which has complained to governments around the world that contracts specifying computers made with Intel chips have led to higher PC prices for taxpayers.

Last year, the European Union charged France, the Netherlands, Finland and Sweden with violating the law by favoring Intel chips when they buy computers, report Reuters and the NYT.

The report says governments are big spenders when it comes to technology. A single computer tender for the French military that was called into question by the EU was worth up to 500 million euro (US$640 million).

The US Office and Management and Budget sent the memo to all federal purchasers, reminding them of regulations that forbid brand-name specification, with rare exceptions.

The NYT and Reuters report that Intel dominates the microprocessor industry with more than 80 percent of the market. AMD has aggressively pursued what it calls unfair business practices by its arch-rival and last month the Japanese government ordered Intel to stop giving discounts to PC makers in return for agreements to avoid AMD chips.


TiVo talking deals with Google, Yahoo

TiVo is in talks with internet search giants Google and Yahoo over a possible deal aimed at bridging television and the web, according to a New York Times report by CNET (18 Apr.).

According to the paper and CNet.One scenario that's been discussed would see TiVo partner with Google or Yahoo on a new service that would let consumers search for videos on the web and then watch them on their television sets, according to one person with knowledge of the talks, who spoke on condition of anonymity.

The paper and CNet further report that a second person familiar with the talks said TiVo has held talks with both Google and Yahoo about a potential equity investment, including the possibility of an outright acquisition. Any deal would likely be exclusive, this source said,

A partnership between TiVo and a major internet search engine would offer expansion opportunities for both. TiVo has long talked about becoming the "Google of TV," eventually enabling its 3 million subscribers to search for and watch any broadcast or broadband media. Though TiVo opened the door for video downloads straight from the web, it does not yet offer such a feature, report the NYT and CNet.

Both search giants have for now focused on PCs and the Web, but ultimately, industry observers believe, their plans will involve television, which generally offers viewers a better video experience. Google and Yahoo are in such fierce competition that neither wants to let the other land a deal with TiVo that might provide an edge. That could strengthen TiVo's hand at the negotiating table, one source said, reports the NYT and CNet.


Infinity to broadcast to cellphones in US

In the US., Infinity Broadcasting has said it planned to broadcast its programs to mobile phones in the United States, and include text data for subscribers.

The New York Times/Reuters report (18 Apr.) that the plan would let cellphone users view song titles and artists' names, check concert dates, buy tickets, ring tones and other content, and participate in station promotions.

Infinity, a unit of Viacom, said it was the first broadcaster committed to the concept in the United States, although it has not reached a deal with a mobile phone operator to carry the service, called "Visual Radio."

The NYT/Reuters report says that Nokia is building handsets for the service, which Infinity is developing together with computer maker Hewlett-Packard.

Monday, 18 April 2005 17:30

News Roundup 18 April 2005


IBM earnings report sends shares down

IBM, the world's largest computer maker, has just reported disappointing first-quarter earnings, setting off a sharp sell-off of its shares in after-hours trading.

The New York Times reports (15 Apr.) that industry analysts said the earnings report might indicate renewed weakness in the technology sector. But executives at IBM attributed at least part of its difficulties to poor execution in its corporate services business, which accounts for about half of the company's revenue.

The company reported sales from continuing operations of US$22.9 billion, up 3 percent from US$22.2 billion in the same period in 2004, says the report, and earnings missed analysts' expectations of 90 cents a share on revenue of US$23.6 billion. Profits from continuing operations reached US$1.41 billion, or 85 cents a share, compared with US$1.36 billion, or 79 cents a share, a year ago.

The NYT says that despite indications in past months of a technology sector recovery, industry executives have noted that corporations were cautious about increasing spending to upgrade systems.

IBM said that one area of unexpectedly weak demand was in Europe, with revenue down 8 percent in Germany, 7 percent in Italy, 3 percent in France. Revenue was down 4 percent in Japan. Those countries represent 25 percent of sales, says the NYT.

IBM's disappointing results were indicative a disappointing week of news for the tech sector all round.

Mobile phone makers report profit declines

Two of the world's leading mobile phone makers, Samsung Electronics and Sony Ericsson, have just reported steep tumbles in profit, accelerating a slide in technology stocks worldwide.

The New York Times reports (16 Apr.) that both companies said harsh competition hurt their results. Samsung's first-quarter net profit sank 52 percent, to 1.50 trillion won, or US$1.47 billion. Sales fell 4.2 percent, to 13.81 trillion won, or US$13.55 billion.

At Sony Ericsson, quarterly net earnings plummeted 61 percent, to 32 million euros, or US$41.02 million, while sales were 1.29 billion euros, or US$1.65 billion, down 4 percent, the NYT reports.

The paper says the results sent chills through consumer electronics shares in Asia and Europe as well as on Wall Street, where IBM's poor results Thursday had already hit the market. Samsung fell 2.09 percent, and the two companies that make up Sony Ericsson also fell. Sony dropped 2.65 percent and Ericsson was down 3.35 percent.

According to the NYT., Motorola and Nokia, which will report next week, dropped 2.12 percent and 1.4 percent respectively. The Nasdaq stock index, which contains many technology companies, fell 38.56 points, or 1.3 percent, to 1,908.15 yesterday.

The paper says the mobile phone industry is struggling to find the new must-have feature to drive sales the way last year's novelty, the camera phone, did. The cameras became an almost universal accessory in new phones, replacing cigarette lighters as the accessory of choice in teenagers' outstretched arms at rock concerts.

The popularity of the camera phones sent sales of mobile phones up 25 percent, to 670 million units last year, according to Ovum, a technology research company based in London. This year, sales are expected to rise only 8 percent, Ovum said, repoprts the NYT.

But, the NYT reports that Ovum, said the softness in the mobile phone market might be relatively short-lived. The industry still has high hopes for new technologies.


Intel: 'dual-core' PCs ready to ship

After months of talking up the benefits of single chips with two computing engines instead of one, Intel has now said computer makers will immediately start shipping PCs with its "dual-core" microprocessors.

The New York Times and Associated Press report (15 Apr.) that the chips will boost performance of PCs running multiple programs at once or a single program that's been optimised to work on a dual-core system. But depending how the PC is used, some users might see a performance decrease over the fastest single-core processors.

The paper and AP say that Intel's first dual-core chip, the Pentium Extreme Edition 840, will be available in systems from Dell, Alienware and others. Intel declined to release prices, but today's single-core Extreme Edition chips run about US$1,000 each -- nearly US$400 more than the fastest Pentium 4.

The announcement is the culmination of an acrimonious race between Intel and archrival Advanced Micro Devices. Both promised to be the first to launch dual-core chips, and it seems Intel is beating AMD by just a few days, say AP and the NYT.

AMD says its microprocessors have been designed from the ground up with dual-core capabilities in mind. Intel, AMD says, glued together two chips in a rush to catch up.

AP and the NYT say that, for its part, AMD says it set its 21 April announcement because that's the two-year anniversary of the launch of its Opteron microprocessor -- the first chip that could process data in 64-bit chunks and remain backward compatible with today's 32-bit chips.


US Congress tackling identity theft

Responding to outrage from consumers whose personal information has been stolen from companies, the US Congress is primed to pass new laws to try to prevent break-ins and to require businesses to confess to customers when private data is taken.

The New York Times and Associated Press report (15 Apr.) that the government's new interest in requiring such embarrassing disclosures reverses years of efforts by the FBI and US prosecutors to shield corporations that have been victims of hackers from bad publicity by keeping such crimes out of headlines.

But now, consumers want to know if their private information has been stolen, says the report.

According to the NYT/Reuters report, the US Senate is considering at least two proposals to crack down on companies suffering breaches of private customer information. The Federal Trade Commission's chairwoman has endorsed the idea and the Senate Judiciary Committee's chairman hinted this week that a new law might be inevitable.

The report says that the new push for government action responds to frustrated constituents who are among more than 10 million victims of identity theft each year. It comes after years of reluctance by most companies to voluntarily report break-ins that put customers' financial information at risk.

The FTC chairwoman, Deborah Majoras, estimated consumers lost US$5 billion and businesses lost US$48 billion because of identity theft in 2003. The FTC is studying how it can use existing banking statutes and laws against consumer fraud to prosecute companies that fail to report serious breaches, report AP and the NYT.


Intel: mobile broadband starting in 2006

Emerging wireless broadband technology WiMax is getting serious attention from both fixed and mobile telecom operators, but it will take years before a mass market of consumers will use it, Intel said on Friday.

The New York Times/Reuters report (15 Apr.) that the head of Intel's mobility unit, said many trials were under way, but the actual deployment of mobile WiMax would not start this year.

The paper and Reuters say that WiMax is seen as a longer-range successor to Wi-Fi, the wireless computer standard popularised in coffee shops and used in homes and restaurants. WiMax enables broadband internet connections over several miles or kilometers, currently to fixed locations but next year also to mobile devices such as laptops or small computers.

According to Intel, most mobile operators are to some extent interested in entering the WiMax field, where the first service providers have already started to offer connections.

The Reuters/NYT report says that Dutch company Enertel's WiMax service is now available in Rotterdam, Amsterdam, the Hague, Utrecht and Eindhoven. By the end of 2005 its network will offer national coverage across the Netherlands.

The report says that, surprisingly, it is not just fixed-line telecoms operators who see WiMax as a way of getting into the mobile services business. Mobile operators see WiMax as an alternative wireless network to relieve their newly built 3G networks from heavy data users and cut costs.

Intel sasid it expected handset makers and operators to roll out a lot of phones using Wi-Fi during the next 12 months, but WiMax phones will come later as the mobile chips are not yet ready, report Reuters and the NYT.


Global PC shipments up 10 percent: IDC & Gartner report

The worldwide personal computer market grew more than 10 percent in the first quarter, fueled by strong growth in Europe and healthy shipments of notebook PCs, market research firms said on Friday.

The New York Times and Reuters report (15 Apr.) that Global PC shipments rose 10.9 percent to 46.1 million in the quarter, about 1 percent above forecast, IDC said. Rival Gartner said shipments rose 10.3 percent to 50.4 million.

The two firms report varying numbers because of different methodologies used in their surveys.

IDC said first-quarter results demonstrate that demand remains healthy going into the new year, despite weakness in quarterly results from IBM that raised concerns about overall technology spending.

Meanwhile, stronger-than-expected growth in Europe, the Middle East and Africa made up for a shortfall in the US market, while on a worldwide basis, corporate demand was weaker than expected, said Gartner, report the NYT and Reuters.

Reuters and the NYT., repoprt that Dell retained its position as the world's largest seller of personal computers in the first quarter, expanding its lead with global growth of more than 13 percent year over year in the period, IDC said.

Dell ended the quarter with 18.9 percent of the market, up from 18.5 percent a year earlier, according to IDC. Gartner pegged Dell's market share at 16.9 percent.

Hewlett-Packard the No. 2 PC maker, had a solid quarter, with growth in line with the overall market growth rate, Gartner and IDC said. HP had 13.9 percent of the market in the first quarter, up from 13.8 percent a year earlier, Gartner said. According to IDC, HP ended the first quarter with a 15.4 percent market share, the NYT and Reuters report.

Reuters and the NYT say that IBM had a "relatively slow quarter" with growth of 2 percent year on year, trailing double-digit growth in prior quarters, IDC said. It remained the world's No. 3 PC maker, with about 5 percent of the global market.

Despite disappointing results for most vendors in the US market, Gartner said Apple Computer moved into the fifth position in the US market, ahead of Toshiba. Gartner reported that Apple's US PC shipments rose 45.1 percent in the first quarter, Reuters and the NYT report.

IDC pegged Apple's PC shipment growth at more than 43 percent, citing the ability of Apple to leverage the success of its iPod digital music player, the iTunes online music store, and the recently introduced Mac mini, the paper and Reuters add.


Risks for IBM after disappointing results

The disappointing performance that IBM reported late last week may be nothing more than a momentary stumble. But the earnings shortfall, which dragged down the market, also points to the risk in the company's strategy for its corporate services business - the main engine of IBM.'s growth and its hope for a prosperous future, reports The New York Times (16 April).

The NYT says IBM is making an ambitious shift in its services business to move beyond helping corporate customers run their data centers to using information technology to make their business operations more efficient. It means putting IBM researchers and software programmers to work for customers to redesign and automate business tasks like procurement, human resources management, accounting and customer service. Customers often hand these tasks over to IBM., the paper reports.

According to the NYT., the logic is to move up the economic ladder to more complex and more profitable tiers of the services industry, thus staying ahead of rivals offering less expensive services - Indian outsourcing companies like Infosys, for example, and Dell, which is expanding rapidly in technology services.

The risk, however, is that competition in its traditional technology services will erode IBM's business faster than the company can replace it with more lucrative work, says the NYT.

The NHT says that IBM's services business has shown sluggish growth for a year, removing the lift that comes from currency gains from the weak dollar. And analysts have raised concerns about the falling trend in signings of new services contracts, an indicator of future growth. New contract signings in 2004 were US$43.1 billion, down from US$55.5 billion the year before, the paper says.

IBM countered that there were more smaller, short-term contracts. Those deals, IBM said, would yield more profitable growth than the multibillion-dollar, multiyear contracts they often replaced. Services represent more than half of IBM's revenues, reports the NYT.

IBM., analysts say, may well trim its payroll by 5,000 or 10,000 workers in its cost-cutting drive, especially in Europe, where business was particularly weak, the NYT reports.


Skype's new online service

Skype Technologies, which makes software that lets internet users call one another free anywhere in the world, has just announced that it is offering two new premium services and that the number of downloads of its basic software had topped 100 million.

The New York Times reports that the new services are SkypeIn, which allows users to get regular phone numbers and receive calls from landline or mobile phones without paying roaming charges, and Skype Voicemail, which permits users to receive voicemail from any user or traditional phone.


Digital camera market 'running out of steam'

The digital camera market is "running out of steam", according to research from Strategy Analytics, which has recorded a surge in demand for camera phones.

The Register reports (15 Apr.) that, it seems, demand for camera phones could hit demand for digital cameras with the major players struggling to maintain current growth rates.

According to the survey,four in 10 of all mobile phones shipped last year had built-in cameras. In all, 257 million camera phones were shipped worldwide during 2004 accounting for 38 per cent of all handset sales, well up on the 84 million camera phones shipped a year earlier.

The Register reports that the survey found that Nokia accounted for 18 per cent of market share, followed by Motorola (17 per cent) and Samsung (13 per cent) as global sales grew 200 per cent on the year.At the same time, camera phones outsold digital still cameras by almost four to one.

According to analysts the digital still camera market is running out of steam and, they predict, vendors such as Kodak, Canon and Fuji will find growth harder to achieve in 2006."

The prediction, reports The Register, is that by 2010, camera phones will account for 15 per cent of the low-end digital still camera market.


Sun Microsystems misses mark on forecasts

Sun Microsystems missed financial forecasts slightly for the third quarter on Thursday but narrowed its loss.

The New York Times/Reuters report (15 Apr.) that Sun, which makes servers and software that run corporate computer networks, lost US$9 million in the third quarter, with break-even earnings on a per-share basis, in contrast to a net loss of US$760 million or 23 cents a share for the period a year ago.

The paper and Reuters report that the smaller loss was the result of US$54 million in income from a year-old settlement with Microsoft, as well as tax and other benefits. Excluding those items, the company lost US$61 million or 2 cents a share, compared with a loss of US$260 million and 8 cents.

Revenue in the quarter was US$2.625 billion, down from US$2.651 billion a year earlier. Analysts had, on average, forecast break-even earnings on a per share basis, excluding items, on revenue of US$2.74 billion, according to Thomson Financial, reports the NYT and Reuters.

Sun's product revenue dropped to US$1.68 billion during the third quarter, from US$1.7 billion in the same quarter a year ago. Revenue from its storage products also fell, as customers shifted away from large centralised systems. Services revenue rose, however, to US$944 million from US$940 million, the report says.

The NYT and Reuters say that though Sun's results were disappointing, analysts said, they may reflect uncertain conditions facing the broader technology sector as much as problems within the company.

"I still think Sun is in the early stages of a turnaround," said Brent Bracelin, an analyst at Pacific Crest Securities. "It just may take a little longer than expected. The timing of the turn in the big unknown."


Nasdaq said to be in talks to buy Instinet

Nasdaq Stock Market, the largest electronic market place, is in exclusive talks to buy Instinet, the institutional brokerage and electronic trading network partly spun off by the Reuters Group in 2001, people briefed on the talks have said.

The New York Times reports (15 Apr.) that Instinet has been for sale since November. While it had been expected that the company, which has both an electronic trading network and an institutional brokerage business, would be sold in two parts, Nasdaq is in talks to buy the entire business for about US$2.5 billion, the people briefed on the negotiations said. It is unclear what Nasdaq would do with the institutional brokerage business.

The report says that competition among electronic trading networks has heated up recently. In September, Nasdaq closed a deal to buy Brut and its Brut ECN for US$190 million from SunGard Data Systems. In January, Archipelago Holding, owner of ArcaEx, spent US$50 million to buy the Pacific Exchange.


Motorola to unveil iRadio for mobile phones

Motorola is betting consumers will pay to have it both ways, gaining control over the content on their car radios and the flexibility of taking their music with them on their mobile phones when they turn off their engines.

The New York Times and Reuters report (15 Apr.) that Motorola, the No. 2 maker of mobile telephones, is set to unveil a service called iRadio that will let users download preselected audio content from a range of providers on their home computers, dump it on their mobile phones and listen to it on their car stereos.

The report says that the company is banking on the popularity of portable music underscored by sales of Apple's iPod digital music players and growing demand for high-quality, commercial-free radio provided by satellite radio companies Sirius Satellite Radio and XM Satellite Radio Holdings.

Reuters and the NYT say that the iRadio service, which will let customers download 10 hours of content at a time, will be available at the subscription cost of about US$5 to US$7 a month. When not driving, customers can listen to content on a phone with a headset.access to more than 100 channels; online music content provider Napster gets about US$15 in the same period for unlimited downloads to a computer, or digital music player. Apple's iTunes music library charges about 99 cents per song.

The report says that several companies are already betting on the potential, boosted by the popularity of a multitude of mobile phones that enable music downloads.

Outside of the United States, operators like Virgin Radio in Britain and Swedish broadcaster SBS Broadcasting System are creating interactive radio to deliver to users with enabled Nokia mobile phones, say the NYT and Reuters.

Motorola plans to test the iRadio service in several US markets in mid-May and launch nationwide in the fourth quarter. The company is also in discussions with several music content and wireless service providers.


US video game sales up 32 Pct in March: analysts

Video game sales rose 32 percent in the United States in March, analysts said on Friday, noting Sony's top-selling "Gran Turismo 4" racing game as well as an improved supply of console hardware.

The New York Times and Reuters repoprt (15 Apr.) that, citing figures from market researchers NPD Group, analysts also said Sony's new PlayStation Portable handheld gaming unit sold 620,000 units of hardware in the month and 1.1 million pieces of software. The PSP was released on 24 March has sold 428,000 units this year, analysts said, quoting NPD. The DS, which costs US$100 less than the PSP, launched last year.

The NYT and Reuiters say that the supply of Sony's PlayStation 2 console continued to improve, analysts said, with 495,000 sold in the month, compared with 227,000 units of Microsoft's Xbox and 94,000 units of Nintendo's GameCube.

The report says that Microsoft has acknowledged the Xbox is in short supply, which some retailers fear may continue through the year as the company prepares to launch its next-generation console, most likely around the holidays.

Most analysts expect US software sales to grow about 5 percent in 2005, driven by growing sales for handheld devices like the PSP and DS, the paper and Reuters report.


IBM wins $125m car black box deal with UAE

IBM has won a US$125m deal with the government of the United Arab Emirates to install tracking devices into tens of thousands of cars by the end of next year.

The Register reports (15 Apr.) that the four-year deal is believed to be the largest in the telematics sector to date. IBM will equip cars and trucks in the state with a telematics device and global positioning system.

The publication says that, similar in concept to the 'black boxes' which track the flight paths of aircraft, the devices will monitor drivers' activities and broadcast them to government agencies. The data will be used by the government to monitor traffic habits, as well as by companies to tailor their advertising to the consumer.

The boxes will also monitor a car's speed and use GPS to compare this to the local speed limit. If the car is speeding the device will warn the driver.

The Register reports that the deal is part of the UAE government's five-year goal to halve the number of accident-related fatalities in the country, a figure which currently stands at 38 deaths per 100,000 people.


Fujitsu seals deal with Lloyds TSB

Fujitsu Services has confirmed that it has won a five-year, £170m contract to manage, update and maintain the IT systems at retail banker Lloyds TSB.

The Register reports (15 Apr.) that under the terms of the deal, 300 staff from Lloyds TSB's existing IT teams and suppliers will move to Fujitsu. They will retain their existing terms and conditions of employment.

Fujitsu will provide desktop support to more than 70,000 users, at almost 2,000 branches and offices of the bank. In total, Fujitsu will be responsible for more than 80,000 devices, including PCs, laptops and servers, The Register reports.

The online UK publication reports that the company will run a range of services for the bank, including IT support, helpdesks and maintenance, as well as taking over responsibility for suppling, configuring and installing new hardware.

The Register says speculation about the deal first hit the headlines back in January this year. At the time, IBM was also thought to be pitching for the deal, because of its close links with the bank. It already holds a seven-year, £500m contract to manage Lloyds TSB's network and VoIP system.

Friday, 15 April 2005 17:30

News Roundup 15 April 2005


Murdoch urges editors to embrace internet

Rupert Murdoch has this week urged newspaper editors to embrace the internet, saying print news executives have "sat by and watched" as a new generation of digital consumers has turned away from newspapers.

The New York Times/Associated Press report (13 Apr.) that the chief executive of News Corp. cited a recent report commissioned by the Carnegie Corporation, a philanthropic foundation, showing 44 percent of 18-to-34-year-olds say they use Web sites at least once a day for news.

Mr Murdoch said newspapers must overhaul how they gather and deliver news to collect the readers and advertising revenue shifting to the web.

''The trends are against us. Unless we awaken to these changes which are quite different than those five or six years ago, we will, as an industry, be relegated to the status of also-rans,'' Murdoch told the annual meeting of the American Society of Newspaper Editors, reports the NYT/AP.

The paper and AP report that Murdocvh told the gropup that:"The challenge for each of us in this room is to create an internet presence that is compelling enough that users make it their home page. Just as people traditionally started their day with coffee and a newspaper, in the future I hope that the way they start their day online will be with coffee and our web site."

Apple earnings better than estimates

Apple Computer has announced its quarterly results,with its second-quarter profit jumping more than sixfold as its iPod music players continued to dominate the market. The results soundly beat Wall Street estimates. reports (14 Apr.) that for the three months ended 26 March, Apple's profit jumped to US$290 million, or 34 cents per share, from US$46 million, or 6 cents per share, a year earlier. Excluding certain unusual items, the computer maker said it would have earned US$299 million, or 35 cents per share.

Revenue for the quarter was a record US$3.24 billion, up nearly 70 percent from US$1.91 billion in the year-ago quarter. further reports that Apple shipped 1.07 million Macintosh computers and 5.3 million iPods during the quarter, a 43 percent increase for computers and a nearly sevenfold increase for iPods from the same period last year. Profit margins also grew -- increasing to 29.8 percent from 27.8 percent a year ago.

The online news service says that analysts surveyed by Thomson Financial expected earnings of 24 cents per share on sales of US$3.21 billion.
The company said international sales accounted for 40 percent of the quarter's revenue.

The latest version of Apple's Mac OS X operating system, code-named "Tiger," is to go on sale 29 April for US$129, reports, adding that Apple executives expect strong sales of the new operating system in the current quarter. reports that earlier this year, Apple executives cautioned bullish Wall Street traders that the company couldn't continue delivering blockbuster revenue and profit growth into the future. Executives warned in January that the introduction of two relatively low-priced products -- the Mac mini computer and the tiny iPod shuffle -- would make it difficult to provide financial guidance for the rest of the year.

But on Wednesday, Apple increased its forecast for the fiscal third fiscal quarter. The company expects to record sales of US$3.25 billion, 61 percent higher than the fiscal third quarter of 2004, and profit of 28 cents per share, says the publication.

Executives said the company sold more higher-profit products than it had previously anticipated in the fiscal second quarter. The company also increased the percentage of products that it sold through its online and bricks-and-mortar retail stores.

AMD posts Q1 loss, but better than expected sales

Chip maker Advanced Micro Devices (AMD) has just posted a first-quarter loss amid the oversupply and falling prices of flash memory chips used in cell phones. But microprocessor sales set a company record. reports (13 Apr.) that AMD also said its flash memory subsidiary, Spansion LLC, has filed paperwork for an initial public offering, though it did not specify the date or the price of the stock. The division is 60 percent owned by AMD, with the remainder held by Fujitsu.

In the second-quarter quarter, the company expects microprocessor sales to be flat or down slightly, in line with historical patterns. AMD declined to provide guidance for its flash memory business because of the pending IPO, the publication reported. reports that for the period ended 27 March, AMD lost US$17.4 million, or 4 cents per share, compared with a profit of US$45.1 million, or 12 cents per share, in the same period last year. Sales fell less than 1 percent, to US$1.23 billion from US$1.24 billion.

Analysts were expecting the company to earn 2 cents per share on sales of US$1.21 billion, according to a survey by Thomson Financial.

AMD said the processor business was not just growing, but was accelerating. says that, though much smaller than Intel, AMD was the first to market with a line of processors that are compatible with applications that ran on previous generations of processors and capable of handling much more memory than most of today's chips. AMD launched its 64-bit Opteron chips in 2003; Intel caught up earlier this year.

The publication says that today, Intel and AMD are in a tight race to formally launch the first microprocessors that feature two computing engines on a single chip instead of just one. AMD is expected to target servers at first while Intel is initially going after desktops and laptops.

Tech layoffs continue

Tech layoffs in the US continued to climb during the first three months of the year, hitting the highest quarterly total since the end of 2003, according to a report just released.

The Mercury News reports (13 Apr.) that there were 59,537 tech-sector layoffs across the US during the first quarter. That's double the number of jobs that the tech sector shed a year earlier.

The paper said the tech industry accounted for almost 21 percent of all layoffs, up from 11 percent a year ago. Mergers among telecommunication companies ushered in the uptick in pink slips, resulting in more than 30,000 layoffs.

According to The Mercury, the tech layoff notices keep coming. Ingram Micro of Southern California -- known as the world's largest technology distributor -- announced this week that it will chop 550 jobs. The cuts are part of a restructuring and outsourcing plan that will move some finance, customer-service, vendor-management, technical-support and inside-sales positions to lower-cost regions by the end of the year.

And BMC Software of Houston also announced that it will cut between 825 and 875 employees, or about 12 percent of its global workforce. BMC is restructuring to focus on growth areas, primarily service management, reports The Mercury.

Microsoft and Europeans argue over ruling

A year and a month after the European Union's landmark antitrust ruling against Microsoft, the software company has still not carried out either of the resulting orders, and this week the two sides argued over when a progress report might be forthcoming.

The New York Times reports (12 Apr.) that the European commissioner for competition, Neelie Kroes, wrote to Microsoft last month requesting information on how the company would comply with the antitrust ruling. The deadline for a response was Monday, but two days later she has still received no reply, European officials said.

The paper says that there was speculation that Microsoft was testing the European Commission's patience, but the company insisted that was not the case. Microsoft said a reply was "imminent."

The specific information Ms. Kroes is seeking concerns the appointment of a group of trustees knowledgeable about the software industry to monitor Microsoft's compliance with last year's antitrust ruling, reports the NYT.

The paper reports that the commission has offered Microsoft the opportunity to comment on how the trustee role would work. The company last month demanded veto power over what information the trustees could examine, but the commission dismissed that as unacceptable. Ms. Kroes then wrote to Microsoft urging the company to agree to her plans for policing the orders contained in last year's antitrust ruling.

In addition to fining Microsoft 497 million euros, or about US$600 million when the fine was paid in March of last year, the commission ordered Microsoft to license the programming code inside its Windows operating system to competitors in the server software market, so they can make programs that work as well with Windows as Microsoft's own server software. Servers run networks of PC's, reports the NYT.

Micron fulfills Intel contract, won't pay penalties

Micron Technology, the world's second-biggest maker of computer-memory chips, has fulfilled provisions of a contract with Intel and won't have to repay any of the US$450 million it received in 2003 from the company.

The New York Times reports (13 Apr.) that Micron received the money from Intel two years ago in exchange for stock rights exchangeable into approximately 33.9 million shares of the Boise-based company's stock.

In addition, says the NYT., Micron agreed to achieve operational objectives, including certain levels of chip production and attaining processing capacity for larger 300mm wafers capable of storing more information or be subject to monetary penalties.

The paper says that according to a filing Tuesday with the US Securities and Exchange Commission, Micron "has achieved the DDR2 production and 300mm wafer processing milestones and, consequently, does not expect to make any payments to Intel under this agreement."

Jobs at risk in IBM Europe services revamp - report

US computing company IBM is planning a reorganisation of its European services business, putting 2,500 jobs at risk and demoting its European chief, a German magazine reported on Wednesday.

The New York Times/Reuters report (13 Apr.) that small European services sites are to be closed by the end of September and the work they do moved to centres in Hungary and the Czech Republic.

The paper and Reuters say that a spokesman for IBM Europe said IBM "is looking at evolving client needs in the way we operate," adding that it would be premature to discuss the magazine report.

Sony says it's open to avoiding DVD format war

Sony Corp has said it is open to holding discussions to create a single standard for the next generation of DVD discs, a move which could head off the looming threat of a major format war among the world's biggest technology companies.

"From the point of view to provide the best service to the consumer one format is better than two. We're open to discussions," Yukinori Kawauchi, general manager in charge of the next DVD format at Sony's Video Group, said in an interview, reeports the New York Times/Reuters (13 Apr.).

The NYt and Reuters report that the electronics industry is facing a battle between the so-called Blu-ray optical discs and HD DVD discs, two different new DVD formats which offer higher capacity than current DVDs.

The first players and recorders for the new formats are expected to be on the market by the end of this year, and as the introduction dates draw closer industry specialists fear a bloody battle similar to the video tape war between the VHS and Betamax formats in the early 1980s, says Reuters and the NYT.

Japan's TDK, Sony and Philips Electronics are part of a large group promoting Blu-ray against a group led by Toshiba and its HD DVD technology.

The NYT and Reuters say, at stake is pole position in the US$10 billion-a-year DVD player and recorder market, and a similar-sized PC drive market.

The report says that the worldwide value of all published DVD products is expected to grow at an average 18 percent a year to US$77 billion by 2009 from US$33 billion in 2004, high-tech market research group In-Stat forecast in a report published last month.

The companies which establish the next DVD standard will reap royalties on the technology for many years to come, say the NYT and Reuters.

At the core of both formats are blue lasers, which have a shorter wavelength than the red lasers used in current DVD equipment, allowing discs to store data at the higher densities needed for high-definition movies and televisions, report the NYT and Reuters.

Anti - piracy software royalties cut after complaints

A group of technology firms has slashed the royalties they want to charge for essential anti-piracy systems after pressure from mobile phone companies, the group has said.

The New York Times/Reuters report that the companies, including Sony and Philips, said they would cut the proposed tariffs for anti-piracy technology by one third to US$0.65 per mobile phone or other electronic gadget.Calls for the reductions stemmed from fears that high royalties might stifle the markets for digital music and video.

The paper and Reuters say that the technology is used in an open standard developed by the mobile phone industry's Open Mobile Alliance (OMA). The GSM Association of mobile operators complained earlier this month about the initial price of 1 dollar per device and 1 cent per transaction, such as buying a song from an online music store.

The group of technology companies which own all the essential patents, represented by a US umbrella organisation called MPEG LA, now propose to charge just US$0.25 per mobile phone subscriber per year, regardless of the number of songs or other digital content that is being purchased in that year, report the NYT and Reuters.

Microsoft rolls out simplified Windows in Brazil

Microsoft has just launched a simplified version of its Windows operating system in Brazil, which could be used in computers to be sold to the poor under a government-subsidised program.

The New York Times/Reuters report (13 Apr.) that the government is mulling whether to use free software or Microsoft Windows in up to 1 million computers under its PC Conectado, or the Connected PC, "digital inclusion" program, and Microsoft has been actively lobbying for Brazil to buy its product.

Microsoft Brasil President Emilio Umeoka said the company formalised its offer of the so-called Starter Edition of Windows to the Brazilian government on Tuesday and hoped they would give the Starter Edition a chance.The offer includes technical support across Brazil, but no financing guarantees, he said, adding that there was no deadline fixed for the government to respond to the offer, the NYT and Reuters report.

The NYT and Reuters say that Brazil is Latin America's largest economy and one of Microsoft's biggest markets in the developing world. The world's fifth most populous country and a growing economic power, has taken a prominent role in the so-called free software movement, an effort that champions free computer operating systems like Linux as an alternative to Microsoft's Windows program.

Many government agencies are migrating to Linux to cut millions of dollars in software licensing costs.

Music group to sue students over downloads

The super-fast ''Internet2'' network that connects universities researching the next-generation internet is also apparently popular among US college students who download pirated music and movies.

The New York Times/Assocviated Prtess repoprt (13 Apr.) that entertainment groups said this week they intend to sue hundreds of students accused of illegally distributing copyrighted songs and films across college campuses using the private research network, which boasts speeds hundreds of times faster than the internet.

How much faster? Internet2 researchers once demonstrated they can download a DVD-quality copy of the popular movie ''The Matrix'' in 30 seconds over their network, a feat they said would take roughly 25 hours over the internet, reports the paper and AP.

The NYT and AP say that the Recording Industry Association of America, the trade group for the largest labels, said it will file federal lawsuits against 405 students at 18 colleges with access to the Internet2 network. The Motion Picture Association of America said it will file an unspecified number of lawsuits against Internet2 users.

The recording industry said it found evidence of more illegal activity at 140 more schools in 41 US states and sent warning letters to university presidents.Internet2 is used by several million university students, researchers and professionals around the world but is generally inaccessible to the public, the NYT and AP report.

Livedoor and Fuji TV in talks

The Japanese internet start-up Livedoor and the Fuji Television Network are discussing a possible alliance, signaling that a contentious two-month struggle for control of a Tokyo radio broadcaster may end amicably.

The New York Times/Reuters reports (13 Apr.) that the two companies have been locked in a battle for the radio company, the Nippon Broadcasting System, which is an affiliate of Fuji TV, Japan's biggest private television network. Livedoor, an internet services and portal company, stunned Japan's investment community by buying up more than half the shares in the radio broadcaster in the last two months, dislodging Fuji TV as Nippon Broadcasting's largest shareholder.

According to the NYT and Reuters, Livedoor is reportedly considering selling some of its shares in Nippon Broadcasting to Fuji TV, Japanese press reports said. The companies are also discussing the possibility of Fuji TV's acquiring a stake in Livedoor, the reports said. The companies confirmed that they were in talks, but did not disclose details.

Judge Orders L.A. co. to halt spam e-mail

A federal US judge ordered a Los Angeles company on Wednesday to stop sending unsolicited e-mails the Federal Trade Commission and California's attorney general allege violate so-called anti-spamming regulations.

The New York Times and Associated Press report (13 Apr.) that US District Judge Samuel Conti, at the urging of the government, directed Optin Global and its owner and president to refrain from sending bulk e-mails advertising mortgages, pharmaceutical products and online college degrees. The government said the e-mails are illegal because the messages allegedly are not marked as advertisements, they don't provide consumers with a method of getting off the distribution list and, among other things, they don't identify the sender.

John Chu, the attorney for Optin and its owner Rick Yang and president Peonie Pui Ting Chen, disputed the allegations in a hearing. ''I don't think they've violated any law,'' Chu said. He added that his clients conduct ''business in good faith.''

According to the lawsuit alleging Optin is violating 2004 anti-spamming federal legislation, the FTC has received more than 1.8 million complaints from consumers regarding e-mails Optin allegedly distributed.

The company sells the information it obtains from consumers to other businesses, and those companies in turn contact the consumers offering their products and services.

The NYT and AP report that the California Attorney General has said the lawsuit seeks up to US$2,500 for every e-mail that violates the Controlling the Assault of Non-Solicited Pornography and Marketing Act.

Authorities arrest 4 in Nintendo sting

In the US., more than 60,000 pirated copies of Nintendo game consoles were seized on Wednesday during raids in New York and New Jersey, prosecutors announced.

The New York Times and Associated Press report (13 Apr.) that four people were arrested in the crackdown on the theft of popular games such as "Donkey Kong," "Mario Brothers," "Duck Hunt," "Baseball" and others, according to a release by federal authorities and papers filed in US District Court in Manhattan.

The NYT and AP report that the arrests occurred after the defendants agreed to sell the games to FBI agents posing as gaming thieves willing to resell the games in Manhattan and through a distributor in the Midwest, prosecutors said.

According to a criminal complaint filed in the case, the defendants between September and December 2004 had imported into the United States more than 280,000 illegal video game consoles, the paper and AP report.

The NYT/AP report also says that more than 60,000 game consoles were seized during searches Wednesday.

US VoIP market hotting up

The current US internet telephony leader (VoIP), Vonage Holdings, launched in 2001 and says it has about 600,000 lines in service.But Vonage's advantage, a recently unleashed TV and online advertising blitz notwithstanding, may not last long, reports the New York Times and Associated Press (13 Apr).

The paper and AP say that among rivals nipping at Vonage's heels are cable TV and traditional phone companies that already have relationships with millions of consumers and are well positioned to bundle together TV, internet access and telephony.

"For a consumer getting a single bill and getting big discounts, that's a pretty compelling value proposition," said Zeus Kerravala, an analyst at the Yankee Group research firm, reportsa tghe papeer and AP.

The report says that at the end of 2003, alternative voice providers like Vonage controlled 66 percent of US internet telephony subscribers, according to the Yankee Group. It predicts that by year's end, that percentage will drop to 19 percent, with cable operators at 56 percent and traditional phone companies at 25 percent.

The NYT and AP say that a big problem for Vonage and a host of other alternative providers -- such as 8x8 Inc.'s Packet8 and Primus Telecommunications's Lingo -- is that they piggyback on home broadband connections controlled by other companies.

The report says that unless they strike a deal with broadband providers and others, they can't guarantee time-sensitive voice packets are given priority over other data, such as someone's illegal movie download. That could result in poor call quality.

The NYT and AP says that cable TV operators and traditional phone companies control the wires into homes -- and often the network far beyond. In many cases, there's no need for voice traffic to ever move over what's considered the public internet. On their private networks, companies can give voice packets priority.

The report adds that most analysts expect the big battle to be between existing cable TV and phone companies. Cable companies are hoping to swipe telco customers with voice services. Phone companies want to keep their existing companies and plan to offer TV over their networks.

So far, phone companies appear to be at a disadvantage because their Internet offerings use DSL technology and it degrades the farther out from the central office. DSL also lacks the capacity of the cable industry's data pipes, though phone companies are beginning to roll out high-bandwidth fiber to residences, report the NYT and AP.

Wednesday, 13 April 2005 17:30

News Roundup 13 April 2005


Tech industry slashing jobs again

Technology companies cut nearly 60,000 US jobs in the first three months of the year, twice the number trimmed in the same period last year and the biggest loss of jobs in the sector since late 2003, according to a new report.

The New York Times and CNet report (12 Apr.) that the telecommunications industry accounted for the bulk of the cuts, with more than 35,000 layoffs in the first quarter, said outplacement firm Challenger, which issued the report Monday. The computer industry laid off about 16,100 workers.

The paper and CNet say that the firm attributed the jump in job cuts to a surge in telecommunications mergers, such as the purchase of AT&T Wireless by Cingular Wireless and Sprint's merger with Nextel.

Accordsing to the report, the phone industry may continue to shed jobs. SBC Communications said recently that it would cut about 13,000 positions if its purchase of AT&T withstands government review. Meanwhile Qwest Communications' proposed buyout of MCI calls for the elimination of as many as 15,000 positions.

The NYT and CNet say that the software industry is not immune either. Oracle cut about 5,000 jobs in the first quarter after gobbling up PeopleSoft.

The industry will come under increasing pressure this year as consumers and corporations take a tech-spending breather, the report predicted, says the NYT and CNet.


Microsoft and Gateway settling antitrust suit

Microsoft has just announced that it would pay Gateway US$150 million over four years to settle the computer maker's claim that it was harmed by Microsoft's abuse of its Windows monopoly.

The New York Times/Associated Press report (12 Apr.) that Microsoft said it would take a US$123 million pretax charge in the quarter ended March 31 to account for the settlement. The company also said it would take a pretax charge of US$41 million for an earlier settlement with, and another charge of US$550 million to reserve funds for other antitrust matters.

The paper says that as part of the settlement, Gateway agreed to drop all antitrust claims against Microsoft. Microsoft denied any wrongdoing in the settlement.

According to the NYT and AP.,Gateway said it would use the funds to create new personal computer products that work with Microsoft software,including the planned new Windows operating system.

The paper and AP say the settlement marked the latest in a series of agreements Microsoft has reached to put various antitrust claims behind it.

Over the last two years, Microsoft has spent about US$3 billion to settle private antitrust lawsuits filed by Time Warner, Sun Microsystems, Be Inc. and Novell. It also paid an undisclosed amount to a trade group that had backed antitrust complaints by the United States government and the European Union.

Microsoft also has been sued by RealNetworks, which is based in Seattle, and is currently appealing a US$600 million European Union antitrust ruling against it, the NYT and AP report.

Start-up wants to improve on Firefox

A new version of the Firefox Web browser is coming your way, but not from the Mozilla Foundation.

The New York Times and CNet report (12 Apr.) that Round Two planned a corporate launch with the promise of bringing "a new crop of products and services that will enhance your Firefox experience."

"When we launch our own services, in about a month or so, we'll be looking to offer the must-have companion to Firefox," said Bart Decrem, Round Two CEO and a former staffer at the Mozilla Foundation, report the NYT and CNet.

The NYT and CNet say that Round Two's mission to improve the Firefox browsing experience may puzzle some Firefox fans, who consider the browser an already vast improvement over Microsoft's Internet Explorer standard-bearer. Firefox has capitalised on widespread dissatisfaction with IE's security and features to swipe considerable market share from Microsoft, says the report.

Firefox, an open-source browser developed and distributed by the Mozilla Foundation, is designed to appeal to third-party developers, and Round Two is but one of several businesses in the Mozilla development ecosystem, say the NYT and CNet.

Round Two also said it was supporting StockTicker, TinyURL Creator, Copy Plain Text, Extension Uninstaller, Lorem Ipsum Content Generator, OpenDownload, Open Long URLs, Search Plugins and Secure Password Generator, report the NYT and CNet.


LexisNexis data on 310, 000 people feared stolen

Data broker LexisNexis has just revealed that personal information may have been stolen on 310,000 US citizens, or nearly 10 times the number found in a data breach announced last month.

The New York Times and Reuters report (12 Apr.) that an investigation by the firm's Anglo-Dutch parent Reed Elsevier determined that its databases had been fraudulently breached 59 times using stolen passwords, leading to the possible theft of personal information such as addresses and Social Security numbers.

LexisNexis, which said in March that 32,000 people had been potentially affected by the breaches, will notify an additional 278,000 individuals whose data may have been stolen, the report says.

The NYT and Reuters say that of the initial group contacted, only 2 percent asked the company to conduct an investigation of their credit records. LexisNexis has found no cases of identity theft, such as using a stolen Social Security number to apply for a credit card.


High - tech wealth shows Israel more than politics

After the success of Silicon Valley in the 1990s, few countries have managed to repeat the mix of education, innovation and investment to create new wealth, and Israel is one of them, a new book said on Tuesday.

The New York Times/Reuters reports (12 Apr.) that a country of just 6.8 million people best known for its conflict with the Palestinians, Israel has managed to create billions of euros of wealth through new products and services, said Douglas Davis, who with his wife Helen wrote ``Israel in the World: Changing Lives Through Innovation.''

The paper and Reuters say in their report that Israeli researchers in recent years have developed instant messaging on the internet, wireless computing chips for Intel, miniature video camera capsules to examine internal organs, filters and tubes for veins to prevent heart attacks and strokes, security software and new cancer treatments.

The report says that the book, to be launched in London this week, covers dozens of examples and explains the success by a potent mix of education and risk capital.

High-tech exports from Israel amounted to US$26 billion in 2000, making up 57 percent of total exports, up from 23 percent in the early 1990s. Risk capital available to new companies is the highest in the world, with a whopping 5 percent of gross domestic product devoted to research and development, the NYT and Reuters report.


MCI want higher offer from Verizon

MCI's board is likely to seek a sweetened takeover offer from Verizon Communications, an executive close to the company said yesterday.

The New York Times reports (12 Apr.) that Verizon has agreed to buy out the company's biggest shareholder, Carlos Slim Helú, for US$25.72 a share, 11 percent more than it said it would pay per share for the rest of the company. After buying Mr. Slim's stake, Verizon would become MCI's largest shareholder.

The paper says the move angered the company's other shareholders, some of whom wanted MCI to accept a higher offer from Qwest Communications, which has offered US$27.50. Now they want to get at least the same deal as Mr. Slim.

According to the NYT., in a statement MCI signaled that if Verizon bought more than 15 percent of the company, it would activate its so-called poison pill provision and issue new shares, making it more expensive for investors to buy the company.

Verizon has already agreed to buy MCI for US$23.10 a share. By purchasing Mr. Slim's stake, Verizon has made it harder for Qwest to block the merger, the NYT says.

In the coming days, MCI is expected to file the regulatory paperwork needed to get a proxy ballot approved. The application is the first step in a roughly three-month process that ultimately gives shareholders the chance to approve or reject Verizon's takeover bid for MCI, the NYT reports.


Intel reward for original Moore's Law text

Moore's Law, the 40-year-old prediction that computer chip performance would double every year or two, may have found a place in history as an accurate forecast. Original copies of the declaration, however, are lost. And a hunt on eBay has begun, report the New York Times and reuters (12 Apr.)

The report says that Intel has posted a US$10,000 reward for an original copy, in mint condition, of the 19April, 1965, issue of Electronics, the technical publication in which Intel's founder, Gordon Moore, made his famous forecast.

The paper and Reuters say that Electronics magazine is now defunct, and Intel, the world's largest chip maker, has no copy. Moore, now Intel's chairman emeritus, lent out his copy and lost track of it, said Howard High, an Intel spokesman.

So rather than make do with the photocopies that have long been circulated, Intel made a call to Silicon Valley neighbor eBay, which helped it post a "wanted" item on the auctioneer's web site, says the report.

More a forecast than a mathematic truth, Moore's Law says that the number of components that can be packed on a silicon chip would rise at an exponential rate -- doubling every two years or so -- and it has held true even until today. Greater numbers of components equates to greater performance, says the NYT/Reuters report.


US cybersecurity consortium formed

Experts from a consortium of US colleges will lead a far-reaching effort to keep the nation's computer data safe from cyberattack, the National Science Foundation has just announced.

The New York Times and Associated Press report (12 Apr.) that the effort comes after a flurry of security breaches have dramatised the vulnerability of a society that increasingly entrusts its secrets to computers.

The paper and AP say that the idea is to look at ways to build more secure systems before a disaster along the lines of an ``electronic Pearl Harbor,'' said the University of California, Berkeley professor who will be principal investigator and director of the new centre.

The new centre, called TRUST, or the Team for Research in Ubiquitous Secure Technology, is expected to receive nearly US$19 million over five years, with the possibility of a 5-year extension after that. TRUST is one of two NSF Science and Technology Centres to be funded this year. The second, centered at the University of Kansas, will study how the balance of mass in the polar ice sheets may affect sea level, says the NYT/AP report.

The NYT and AP say that Berkeley will be joined by Carnegie Mellon University, Cornell University, Mills College, San Jose State University, Smith College, Stanford University and Vanderbilt University. A number of businesses also will be affiliated with the project, including Microsoft, Hewlett Packard, IBM, Sun Microsystems and Symantec.

The report says that TRUST researchers will explore developing technology that will help organisations build secure information systems. Beyond thwarting cyberthieves, they will also look at ways to keep systems running even when being struck, a concept known as ``degrading gracefully under attack''.

Microsoft to show off new Xbox on MTV

Microsoft will offer video game fans a first peek at the new version of its Xbox game console during a half-hour MTV broadcast, part of a marketing deal.

The New York Times and AP report that the software maker will preview the new game system in worldwide broadcasts on 12 May 12 and 13 May, on various MTV channels.

During the broadcast, Microsoft also plans to show off new enhancements planned for its Xbox Live online video game service, says the report.

The paper and AP say the half-hour program comes days ahead of a major games conference, E3, during which Microsoft said it will provide industry insiders more details of the game system.

Microsoft has not yet said when it plans to release the new Xbox.


News companies support reporters in Apple case

More than a half-dozen news organisations are supporting three online journalists who published articles about a top-secret technology product that Apple Computer says was protected by trade secret laws.

The New York Times/AP report that in December, Apple sued 25 unnamed individuals -- presumed to be Apple employees -- who allegedly leaked confidential product information to three people who run web sites widely read by Apple enthusiasts. The company said the leaks violated nondisclosure agreements and California's Uniform Trade Secrets Act.

The paper and AP say that Apple then demanded that the online reporters' internet providers identify the leakers by turning over e-mail records. The online reporters sought to block the subpoenas, saying that identifying sources would create a "chilling effect" that could erode the media's ability to report in the public's interest.

A Judge ruled in Apple's favor last month, saying that reporters who publish "stolen property" aren't entitled to protections. The online reporters then appealed.

The NYT and AP say that now the mainstream media have weighed in: eight of California's largest newspapers and The Associated Press submitted a court brief Thursday asking that the online publishers be allowed to keep their sources confidential.

The media companies said the ruling, if upheld, could impair the ability of all journalists to reveal important news, from financial corruption to government cover-ups. Before demanding that the online publishers' internet provider turn over e-mail records, the companies said, Apple should "exhaust all alternative sources" of identifying the source of the leaks, the NYT/AP report adds.

The NYT/AP report says that joining the brief were the Tribune Co.'s Los Angeles Times, Hearst Newspapers' San Francisco Chronicle, Knight Ridder Inc.'s San Jose Mercury News, The Copley Press Inc.'s San Diego Union-Tribune and Freedom Communications Inc.'s Orange County Register, as well as The McClatchy Co.'s Bee newspapers in Sacramento, Fresno and Modesto. Also supporting the brief were the California Newspaper Publishers Association and the nonprofit free speech organization California First Amendment Coalition.

An Apple spokesman Steve Dowling wouldn't comment specifically on the media companies' brief but emphasised that Apple must protect its product secrets,the report adds.

Nikon: cheaper digital SLR to rival Canon

Japan's Nikon said on Monday it would launch a lower-priced digital single lens reflex camera later this month to challenge rival Canon in the lucrative market for high-end cameras.

The New York Times/Reuters report that after Canon, Nikon is the world's second-largest maker of digital single lens reflex (SLR) cameras, which use interchangeable lenses and generally offer higher performance than simple point-and-shoot models, which have a fixed lens.

The paper and Reuters say that the camera world has been anxious to see when Nikon would launch a new line-up of digital SLRs to follow the D70, a highly-acclaimed model that has been flying off the shelves since it was introduced worldwide early last year.

The report says that Nikon created a buzz in camera chat rooms on Friday when it issued a press release on its UK Web site saying that it would launch two new digital SLRs in the UK market toward the end of April -- one a successor to the D70 and another more basic model.

The paper and Reuters say that press release was issued after the company accidentally uploaded some information about the digital cameras on its web site, sparking speculation about an impending launch. The release has since been removed.

A Nikon spokesman in Tokyo would not comment on launch dates for other markets but acknowledged that the company was getting ready to launch a successor to the D70 and a less expensive model to match up with a digital SLR introduced by Canon last month, report the NYT and Reuters.

The report says industry analysts are bullish about the prospects for the digital SLR market because of the recent increase in these lower-priced models. Just a few years ago there wasn't a model on the market for less than US$2,000, and some cost US$5,000 or more.

The paper and Reuters say that Nikon is not likely to wait long after the UK launch this month to introduce the new cameras in other major markets such as the United States and Japan. It could also decide on asimultaneous launch worldwide.

Nikon aims to ship 1.5 million digital SLR models in the business year started this month, up 50 percent year-on-year. Including compact models, the company expects to ship 7.5 million digital cameras, up from an estimated 6.6 million in 2004/05, report the NYT/Reuters.

Sanyo, IBM develop ThinkPad fuel cell

Sanyo and IBM has just announced that they will jointly research and develop a fuel-cell power system for notebook PCs.

The Register reports (11 Apr.) that the two companies said they will develop a hybrid system. Essentially, the direct methanol fuel cell will work alongside a slimline lithium-polymer rechargeable battery.

According to The Register, that's presumably because of the bulk of the fuel cell. A concept model described by Sanyo and IBM weighs in at 2.2kg and is larger that the ThinkPad they used to demonstrate it. The 28 x 27 x 1.6-5.4cm pack incorporates a 130cc fuel tank which holds enough methanol and water to provide 16V and 12-72W of power for up to eight hours' operation.

The Register says that with the battery in place, the fuel cell can be hot swapped, the two companies said, allowing the user to trade power for mobility. No wonder, says The register, that Sanyo and IBM have said getting the size down was a key target for both their research teams, with the ultimate goal of incorporating it into the body of the notebook itself.

China's new rules on procurement

China is changing the rules for government departments which want to buy software produced outside the country, according to a Financial Times report carried by The Register (12 Apr.).

The Register says that Government purchasers must define software vendors as "domestic, non-domestic and preferred domestic", according to the Financial Times.

The Register reports that the FT says that under new rules government departments wishing to buy foreign software will have to get special permission. The changes are designed to bolster China's domestic software industry but could breach international trade laws.

The paper and The Register say that there are also tough definitions for software vendors to meet. At least 50 per cent of development costs must be spent in China for software to qualify as "domestic". To be a preferred supplier, companies must train local staff, invest revenues back into China and "transfer core software technology to China".

China's procurement rules came under the spotlight last year when Beijing Municipal Council came under fire for placing a big order for Microsoft software. The order was cancelled in favour of a local supplier after media complaints. But it later emerged that the council bought more Microsoft code than local software., says The Register, quoting the FT report.

Oracle completing Retek buy

Oracle is about to complete its acquisition of retail software maker Retek, beating out rival SAP.

The Register reports (12 Apr.) that Oracle currently holds 94 per cent of Retek's outstanding shares, giving it enough clout to close the acquisition, it said on Monday. All of the remaining shareholders will be offered US$11.25 per share in cash.

The Register says that Oracle has said that with its acquisition of Retek complete, the company is poised to provide retailers with an unparalleled partner for information technology solutions.

The Register says that Oracle shelled out US$670m for the company, or US$11.25 per share. SAP originally offered US$8.50 per share for Retek, was outbid by Oracle and raised its target to US$11 per share only to be outbid by Oracle again.

Oracle has created a Retail Global Business Unit for the Retek assets, reports The Register.


WiMAX summit: preoccupied by 'road to mobility'

The Register reports (12 Apr.) that this week saw the WiMAX community gathered in force at the WiMAX Summit in Paris, France - and, it quickly emerged that the issue preoccupying both vendors and potential operators is the road to mobility and exactly how the transition to the forthcoming 802.l6e mobile standard will be achieved.
According to The Register, with a key WiMAX Forum meeting to be held in the coming week in Spain, and 802.16e set to be ratified this year, it is essential to the uptake of the platform that the route to mobility is clarified as soon as possible.

Tuesday, 12 April 2005 17:30

News Roundup 12 April 2005


Indian call centre staff arrested for fraud

Three workers from an Indian call centre have been arrested for defrauding US bank customers.

The Register reports (11 Apr.) that, in total, 12 people have been arrested for cheating Citibank customers out of US$350,000. Three of the men worked for Mphasis, an offshoring firm which runs call centres in Bangalore and Pune.

The Register says they are accused of charming PIN numbers out of customers and using them to transfer funds illegally, according to AP. Customers noticed the dodgy transfers and complained to Citibank, which traced the problem back to Pune. Bank officials then contacted the police.

According to The Register, there have been concerns that offshoring business services increases the danger of fraud. The fact that this scam relied on old school social hacking - getting customers to tell you their PIN number - may reassure some, says the publication.

The team were in the process of transferring another raft of funds when they were arrested by Pune's Cyber Crime unit. The men have been remanded in custody until 11 April, reports The Register.

IBM profits from making patents available free

IBM is renowned for its rich storehouse of patented inventions. It once again led the research sweepstakes in America last year, collecting 3,248 patents, more than any other company. And it earned more than US$1 billion last year from licensing and selling its ideas.

The New York Times and Associated Press in a report (10 Apr.) question why it is that IBM has shifted course recently, giving away some of the fruits of its research instead of charging others to use it? The answer is self-interest, according to the paper and AP.

The report says that, diverging from conventional wisdom, the company has calculated that sharing technology can sometimes be more profitable than jealously guarding its property rights on patents, copyrights and trade secrets. The moves by IBM, the world's largest supplier of information technology services and computers, are being closely watched throughout the business world, the NYT/AP say.

Earlier this year, IBM made a broad gesture toward what it called a new era in how it controls intellectual property., says the report, when it announced in January that it would make 500 patents - mainly for software code that manages electronic commerce, storage, image processing, data handling and Internet communications - freely available to others.

This month, the company said that all of its future patent contributions to the largest standards group for electronic commerce on the web, the Organization for the Advancement of Structured Information Standards, would be free, report the NYT and AP.

The report say the the internet, globalisation and cost pressures are driving businesses to collaborate in the pursuit of higher productivity and profits, and to accelerate the pace of product development. That collaboration requires companies to share more technical information with corporate customers, suppliers and industry partners. The result, specialists say, is that the terms of trade in intellectual property, and the boundary lines, are shifting, the NYT and AP report.

The NYT and AP says the shift by IBM , admittedly, is carefully calibrated. The company is not forsaking its lucrative technology licensing business or pulling back on new patent filings. And the company is not giving away the technology for its mainframe computers, its proprietary database software and other complete products, the report says.

The NYT and AP say that in its software business, IBM has been a champion of open-source projects like the Linux operating system, on which programmers collaborate and share code. The patents it made available in January are for use in any open-source project.

The report also says that the company is particularly interested in a proposed law to harmonise patent rules in the 25 countries of the European Union. Many European countries, legal specialists say, effectively allow software patents already as computer-accomplished inventions, which cover hardware and software working in tandem.

Apple leg fight over iTunes domain
People who want to use Apple's popular iTunes service in Britain must go to the web page, not

The New York Times reports (11 Apr.) that the minor difference may make very little difference to music lovers, but to Apple Computer and Benjamin Cohen, a 22-year-old British entrepreneur, it is a difference worth fighting over in court.

The paper reports that Mr. Cohen, who lives and works in Hackney in East London, is the founder of CyberBritain, an internet company that registered in November 2000, two months before Apple introduced its iTunes music store. Last November, Apple offered to buy the domain. When the two sides could not agree on a price, Apple appealed to Nominet, the British registry for internet names, and was eventually awarded the domain.

The NYT further reports that Mr. Cohen, who was ordered to surrender the domain by 13April, says he plans to take the case to the High Court for judicial review. In a flurry of recent newspaper, radio and television interviews, he has presented himself as a technology-age David, a small businessman with the chutzpah to battle the giant. But Nominet ruled that, by trying to capitalise on the iTunes domain, Mr. Cohen was the party engaging in an abusive behavior, commonly known as cybersquatting.

The paper says that Mr. Cohen first became known in the British media as the teenage millionaire when, at the age of 16, his first company, a listings web site called, was valued at £5 million (US$9.4 million). At 18, after he started, Europe's first and largest adult search engine. Mr. Cohen, who describes himself as a "clean-living Jewish boy from a typically neurotic Jewish family," sold the site for £25,000 in 2001. "I didn't want to be known as a porn baron," he said.

According to the NYT., in November 2004, lawyers representing Apple approached Mr. Cohen, offering to buy his iTunes domain. (Visitors to are now forwarded to Mr. Cohen's latest online venture, a rewards service called

"Apple wrote to my lawyer, who is also my father, offering to buy the domain name for US$5,000," said Mr. Cohen. "That would barely have covered our legal costs." He suggested an amount equivalent to US$94,000, "a sum which includes a premium since I don't actually want to sell it," says Mr Cohen, as reported by the NYT.

In recent interviews, Mr. Cohen has made much of the fact that he was unaware that Apple had filed an application for the iTunes trademark in Britain when he registered the domain name. "That fact was not made public in the Trademark Journal until 6 December 2000, so there's no way I could have possibly known," said Mr. Cohen, who says he was also unaware of Apple's iTunes product until after it was introduced in Britain.

The NYT say, however, that Nominet ruled that Mr. Cohen's fatal mistake was not what he did when he registered the domain so much as what it did with it later. According to Nominet's investigation, Mr. Cohen subsequently sent an e-mail message to Napster, a rival music service, in October 2004 asking if it would be interested in buying his iTunes domain. The message said that Mr. Cohen's company owned and registered the name before Apple introduced the iPod.


Microsoft files counterfeit lawsuits

Microsoft, the world's largest software maker, has just announced that it is filing lawsuits against eight computer system builders and resellers in seven US states, accusing them of distributing counterfeit and unlicensed software and software components.

The New York Times/Reuters report (11 Apr.) that the lawsuits follow similar action in November 2004 against eight dealers. Legal amendments in 2003 provide criminal and civil penalties for distributing software without authenticity certificates.

Microsoft told the NYT and Reuters that its partners were Tbeing undercut and forced out of business by having to compete with dishonest PC manufacturers and resellers who continue to sell illegitimate software.

Microsoft said the lawsuits, filed in California, Florida, Texas, New Jersey, Alabama, Maryland and Rhode Island, alleged distribution of counterfeit, illicit and unlicensed software and components, report the NYT and Reuters.

The lawsuits stem from an ongoing test purchase program started by Microsoft in 1997 in which the company acquires software, components or computer systems from dealers and tests them for authenticity, says the report. If they are not legitimate, the dealer is generally sent a cease-and-desist letter and told how it can obtain legal, genuine software before Microsoft takes further action, the report adds.

The NYT and Reuters say that Microsoft cited the Business Software Alliance, which says 22 percent of software being used on computers in the United States is unlicensed, including counterfeit and pirated software.


Intel confirms 'Conroe'

Intel has confirmed its 'Conroe' microprocessor, believed to be a desktop version of its upcoming 'Merom' mobile chip, will ship as part of the chip giant's 'Averill' desktop platform due next year.

The Register reports (11 Apr.) that Averill's existence was revealed last February at Intel Developer Forum as the basis of NetBurst processors 'Presler' and 'Cedar Mill'. Last week at the Forum's Japanese outing, the company added Conroe to the list. Averill comprises these three processors, the 'Broadwater G' integrated chipset - itself incorporating the ICH8 South Bridge - and 'Nineveh', Intel's next-generation Ethernet chip, says The Register.

According to The Register, both Nineveh and Broadwater will support the second version of Intel's Active Management Technology. Averill will also feature 'La Grande', the chip company's upcoming Trusted Computing sub-system, along with SpeedStep, Virtualisation Technology, 64-bit addressing and no-execute anti-virus technology.

The 65nm Conroe and Merom are expected to ship in Q3 2006, two quarters after Yonah's debut with 'Napa', the third incarnation of Intel's Centrino platform. Conroe is expected to contain 4MB of L2 cache, 2MB associated with each core, says The Register.

The Register says that last week's mention of Conroe is the first time Intel has publicly stated it is working on a processor with that codename. No details of the chip were given beyond what it's being called during its development.


Asian century dawns for IT industry

India and China can take a leading role in the technology industry if they put aside their historic differences and work together.

The comments came from China's Prime Minister Wen Jiabao as he visited Bangalore, reports The Register (11 Apr.), and when the PM called on Indian software firms to work with Chinese hardware manufacturers. He said such cooperation would create an "Asian century of the IT industry".

The Register reports that India and China are expected to sign 30 agreements covering business and cultural matters. The two sides are also hoping to resolve disagreements over their mutual border.

US internet users more accepting of spam

A study released in the US by the Pew Internet and American Life Project says Americans are 'not any less annoyed by spam, they're just more accepting of it'.

The New York Times reports (1 Apr.) that 53 percent of adult e-mail users in the United States now say they trust e-mail less because of spam, down from 62 percent a year ago and about the same as a June 2003 Pew survey.

Pew also found that 22 percent of e-mail users say they are spending less time on e-mail because of spam, down from 29 percent last year. In 2003, it was 25 percent, the paper reports.

The paper says the Pew study also found that pornographic spam is on the decline, replaced by fraudulent "phishing" scams aimed at stealing bank passwords and other sensitive information.

There was little change in what people do to reduce spam, the satudy found, with about the same percentage avoiding giving out e-mail addresses or setting up special addresses when they believed they might attract spam. In fact, a lower percentage avoided posting e-mail addresses on web sites, where spammers often collected addresses for their mailings.


US flight crews: keep ban on cell phones

It seems as though there's one on every flight: the passenger who gabs into a cell phone through the boarding process and keeps chatting until the final seconds before take-off, silenced only by a flight attendant who asks that the phone be turned off.

In the US, flight attendants are doing what they can to tell the Federal Communications Commission that its proposal to lift the ban on cell phone use in the air is a bad idea, reports The Mercury News.

The Mercury says that, according to a poll released last Thursday by the flight attendants union, 63 percent of airline passengers oppose the idea of allowing in-flight cell phone calls, citing the disruptive noise from yakking passengers as their primary reason.

The flight attendants' union believes cell phone use would create a more stressful environment on flights, potentially leading to incidents of "air rage," says The Mercury.

The publication says some travelers share a similar sentiment, but the ban was never put in place to minimise noise levels inside the plane. The FCC and the Federal Aviation Administration put the prohibition in place for safety and technological reasons.

The Mercury further reports that the FCC had long been concerned that cell phone use on an airplane might interfere with cellular signals on the ground, while the FAA worries that the cellular phone traffic might interfere with the navigation and communication systems in the cockpit.

However, late last year, the FCC said technological advances had reduced its concerns. And the FAA has launched a study of cell phone effects on cockpit control that is due early next year. If those concerns of interference go away, the two agencies could lift their respective bans in the next year or so, reports The Mercury.

The Mercury says that has flight attendants worried about the in-flight noise, which could interfere with a passenger's willingness and ability to follow safety instructions and possibly lead to "air rage" that they would be forced to police.

The survey -- which also presented what-if scenarios if the ban is lifted -- revealed that about 80 percent of surveyed passengers worried the cell phone use would put the nation at higher risk for terrorist attacks because in-flight terrorists would be able to easily communicate with their on-the-ground counterparts, The Mercury reports.


Disney broadband offerings for kids

The Walt Disney Company is expanding its broadband offerings for kids, adding activities for preschoolers and planning a second multiplayer online game aimed at teens.

The New York Times/Associated Press report (11 Apr.) that Disney's Internet Group will launch a paid preschool broadband service this summer, featuring guided activities and games hosted by the lead character from "Bear in the Big Blue House."

The service, called "Playhouse Disney Preschool Time Online," is meant for children ages three to five and their parents. Activities will center on a weekly theme or "episode," such as "friendship" or "sharing," report the NYT and AP.

The paper and AP say the offering is part of a larger strategy to expand the Disney's high-speed internet offerings for kids of all ages.


AOL, XM Satellite announce new partnership

In the US.,XM Satellite Radio Holdings and America Online are planning to add some of the satellite service's programming to AOL's radio offerings in a bid to bring a sample of paid radio to a wider audience, while boosting traffic at AOL's signature site.

The New York Tmes and Associated Press report (10 Apr.) that under the partnership just announced, XM and AOL will share content for their respective platforms.

The paper and AP say that web surfers will be able to access 20 XM channels on AOL's radio section, along with its current roster of about 130 stations, for free. A new version of AOL's "premium" radio service will have 70 XM channels and be available for a monthly fee, which has not been set.AOL subscribers will automatically receive the enhanced service.

To date, commercial-free satellite radio from XM Satellite and rival Sirius Satellite has been a subscription-based service that's not been widely available to sample.

The NYT says XM has 3.8 million subscribers, who get 150 digital radio channels. AOL says its radio network has 10 million visitors monthly, and offers more than 200 stations.

Monday, 11 April 2005 17:30

News Roundup 11 April 2005


Email scam: bogus Windows update

An e-mail scam making its way around the internet purports to be a message from Microsoft warning users of the Windows operating system that they need to download a security update -- only to leave their PC infected.

The Mercury News reports (9 Apr.) that once users link from the e-mail to a bogus web site their computers will be infected by a "Trojan horse" program that allows hackers to control their personal computers,anti-virus software maker Sophos said Friday.

The paper says that the campaign of bogus e-mails could be timed for around the same time as Microsoft's latest regularly scheduled security update, planned for Tuesday.

Microsoft said it was aware of the scam and added that it would never use e-mails with attached software, and emphasised with that was the only place to get authentic security updates for Microsoft products.

The Mercury says that the scam e-mail claims to come from "Windows Update," with subject lines such as ``Update your windows machine,'' "Urgent Windows Update" and "Important Windows Update," Sophos said. The message has a link to a web site that claims to be operated by Microsoft but is actually used to download the malicious software to the victim's computer.

The paper adds that users who try to download software from the scam Web site would have their computers infected with a piece of Trojan virus named "Troj/DSNX-05," which leaves a "backdoor" program giving hackers remote control of the computer.

It further reports that PCs infected by such Trojans are often used by spammers as "zombie" machines to send massive waves of e-mail pitches, without their owners' knowledge, that are harder to trace to the original source.

The Mercury says this Trojan was discovered by security researchers in August and was simply included in this new scam targeting Windows users.

Sophos and Trend Micro said Friday that the attack appears to be on a small scale.


US spammer appeals 9 year prison sentence

In the US, a North Carolina man convicted in the nation's first felony prosecution for spamming was sentenced on Friday to nine years in prison, but the judge postponed the sentence while the case is appealed.

The New York Times/Associated Press report (9 Apr.) that a jury recommended the nine-year prison term after convicting Jeremy Jaynes of sending at least 10 million e-mail messages a day with the help of 16 high-speed lines.

Jaynes, 30, will be free on US$1 million bond until the appeals process concludes.

According to the NYT and AP, Jaynes was convicted in November for using false internet addresses to send mass e-mail ads through a server in Virginia. Under Virginia law, sending unsolicited bulk e-mail itself is not a crime unless senders mask their identities.


Microsoft: new Xbox games through 2007

New games for Microsoft's current Xbox video game console will debut through 2007, Microsoft said on Friday, even as it prepares for the expected imminent release of an Xbox successor.

The New York Times and Reuters report (8 Apr.) that while Microsoft has not committed to a release date for the new console, code-named "Xenon," the industry universally expects it sometime at the end of 2005.

The paper and Reuters say that in a release on developers who will make games for that next-generation hardware, the company said "Microsoft is fully committed to this (current) generation and gamers can expect an amazing pipeline of titles into 2007."

A Microsoft spokeswoman told Reuters that 2007 is not a hard stop, but rather a guideline for the last releases of new games developed for the Xbox. Microsoft has not said whether its next console will be compatible with the current Xbox.

Thew paper and AP further reporrt that new games for Sony's PlayStation continued to come out through late 2004, even though the successor PlayStation 2 made its debut in late 2000. The PS2 is backward compatible with the PSOne.

Microsoft said every major name in the publishing and development industries has committed to make games for the new console. More details are expected next month at E3, the industry trade show in Los Angeles, report the paper and AP.


Sony sold 500, 000 PSPs in two days in N. America

Sony sold 500,000 units of its PlayStation Portable handheld video game device in the first two days after its North American release, about half the units the company had aimed to provide retailers, Sony has announced.

The New York Times/Reuters report (8 Apr.) that the US$249 PSP Value Pack came out 24 March in the United States. There were mixed reactions to the early sales, with some analysts saying the device was not selling as fast as some large chains might have expected.

However, according to the paper and Reuters, Sony said the PSP generated a total of US$150 million in first-week sales at North American retailers. It said sales remained strong through the rest of the first week but did not quantify what that meant or give details on second-week sales.

The PSP came out late last year in Japan and has sold more than 1 million units there to date, says the paper and Reuters.

Sony postponed the European launch of the PSP indefinitely in order to ensure it would have an adequate supply for the U.S. launch, which it promised would be about 1 million units on the first day, says the NYT and Reuters.

Analysts expect sales of handheld games to drive industry growth in 2005. Most forecast US software sales growth of about 5 percent this year, the report in the NYT says.


Razr, design push change Motorola's image

Technology always trumped good looks at Motorola, whose distinguished 77-year resume includes the first car radio, walkie-talkie and cell phone but not a lot of tech beauty prizes, reports The New York Times (9 Apr.).

Today, however, the NYT says plain is out and sleek and stylish are in as a new focus on design wins back customers and market share at Motorola -- a comeback from a long decline in full force after one to one-and-a-half years.

The paper says the symbol of the resurgence is the ultra-thin Razr, whose success helped vault the company over worldwide leader Nokia as the top phone seller in North America last year and, even more noteworthy, stamped pioneer Motorola as the trendsetter again in innovative design.

The NYT reports that the US$450 Razr embodies "a departure from the stodgy, engineering-driven, Midwestern company that was Motorola," according to aYankee Group analyst.

According to the paper, the device formerly known as the cell phone, as Motorola insiders refer to it, has itself been on an industrywide roll as consumers embrace its growing tools -- camera, e-mail, music, speakerphone and shrinking size. The number of mobile phones sold worldwide surged 30 percent to 674 million last year en route to a projected 730 million-plus in 2005, according to the Gartner research firm.

The NYT says that the company's Triplets phones delivered the first success from the new approach in the first quarter of 2004. But the release of the flashy Razr V3 sent the loudest message that Motorola was back. Shiny, angular and an implausible 1/2-inch thin, the quad-band phone packs a color camera, Bluetooth wireless technology, instant messaging and unique ring tones into a 3.3-ounce clamshell design.

The company says about 1 million consumers have bought Razrs, representing just a tiny fraction of the roughly 100 million cell phones it sold in 2004, reports the NYT, but analysts say the model helped boost profit margins and created a buzz among consumers that helped build momentum for other products.

The NYT says a 35 percent leap in sales last year pushed Motorola's share of the global cell phone market back up to 15.4 percent and enabled it to take back second place from Samsung, which briefly surpassed it in the third quarter, according to research firm Gartner.


ICANN approves two new domain names

The internet's key oversight agency gave final approval Friday to two new internet suffixes -- ".jobs" for the human resources community and ".travel" for the travel industry.

The New York Times/Associated Press reporet (9 Apr.) that it could take months, though, for the domain names to start appearing in use, as companies running those names now must set up registration and other procedures.

According to the NYT and AP.,approval came as the Internet Corporation for Assigned Names and Numbers ended meetings in Argentina. ICANN staff has spent the past few months negotiating contracts with the companies following the board's preliminary approval of those names last year.

The paper and AP say that negotiations continue on two other names already given preliminary approval: ".post" for postal services and ".mobi" targeting mobile services.

The board did not yet act on a contract to run the ".net" directories beyond 30 June. An outside company had recommended that VeriSign be given a six-year extension, says the AP report in the NYT.


Google triumverate takes salary cut to US$1 a year

The trio of billionaires who run -- and own much of -- online search engine leader Google reduced their individual salaries to US$1 last year and rejected a recent attempt to give them a raise, according to documents filed Friday.

The New York Times/Associated Press report (8 Apr.) that Google co-founders Larry Page and Sergey Brin and the company's chief executive, Eric Schmidt, dramatically lowered their salaries last spring -- right around the time that the company filed its plans for a much-anticipated initial public offering of stock that made their paychecks largely irrelevant.

The paper and AP say that before the concessions, Google paid Page and Brin an annual salary of US$150,000 apiece. Schmidt collected US$250,000 annually before lowering it to a dollar. In the months leading up to the pay cuts, Page and Brin each collected US$43,750 of their former salaries while Schmidt pocketed US$81,432, according to a filing with the Securities and Exchange Commission.

According to the paper and AP., last month, Google disclosed that Page, Brin and Schmidt weren't paid a bonus last year except for a US$1,556 holiday reward paid to all company employees.

Page and Brin each own a 27.8 percent stake worth US$7 billion, while Schmidt's 10.6 percent stake is worth US$2.7 billion, says the paper and AP.

The paper and AP say that Schmidt apparently isn't having trouble making ends meet. In February, he bought a corporate jet that he leases to the company for US$7,000 per hour -- a below-market rate, according to the company's evaluation. Google has agreed to reimburse Schmidt up to US$2.1 million this year for using his jet.


HP, Sun and IBM bringing out dual-core Opteron gear

HP, Sun Microsystems and IBM are waiting in desperation to release new servers based on AMD's dual-core Opteron chip, according to a report ion The Register (9 Apr.).

The Register says the vendors will get some relief when they show off the fresh kit on 22 April at an AMD product launch/Opteron anniversary event. The New York gig will be hopping with every server vendor that counts - except Dell - showing product based on AMD's new dual-core.

According to The Register, HP plans to make a splash by upgrading its four-processor ProLiant DL585 server with the new dual-core Opterons. The box should start shipping in volume in May, according to one insider. In the near future, HP will also outfit its dual-processor DL145 server with the dual-core chips.

The report in The Register says that last but not least, HP is expected to unveil its compact BL45p Opteron-based blade server at the AMD product launch. This will be the third member of HP's AMD blade line and a welcome choice over the Xeon-based blades that are being end of lifed.

The servers should be available with 2.2GHz and 2.4GHz Opterons, sources said. The price of the 2.2GHz dual-core chip will be the same as current single-core Opterons, as AMD looks to drive demand for the product and put pressure on Intel which won't have a comparable dual-core part until next year, says The Registyer.

The Register says that at the moment, HP is having some trouble differentiating its Opteron gear from Sun and others, but that could change in the third quarter, when it and Broadcom unveil a new Opteron chipset, one source said.

Sun is expected to take a similar route as HP at the AMD launch, says The Register, when it will likely announce that its four-processor V40z will be available with the dual-core Opterons. The two-processor V20z will then be upgraded soon after, as AMD appears to be releasing its Opteron for four-processor servers several weeks ahead of the chip for two-way boxes.

IBM is expected to wow customers, says The Register, with a new Opteron-based blade that will be sold alongside its current two-processor Opteron server. IBM has been dangling the blade in front of customers for some time, according to insiders.

AMD is bringing out the dual-core Opteron months ahead of its "mid-2005" original guidance. This is a solid move for a company that has struggled to match Intel's consistency with delivering product, The Register reports.


MIT, Taiwanese laptop maker team up

Taiwan-based Quanta Computer and the Massachussets Institute of Technology said Friday they are teaming up on a US$20 million, five-year project to get PCs, laptops, cell phones, and handhelds to work together seamlessly, intuitively and in sync.

The New York Times and Associated Press report (9 Apr.) that MIT's Computer Science and Artificial Intelligence Laboratory, said the agreement, financed by Quanta, is expected to be the first phase of a long-term partnership to incorporate new ideas into products and spur broad discussion of the digital future.

According to the NYT and AP.,the project will involve meetings between the partners both at MIT and in Taiwan to "work toward a new world of self-organising devices which make our lives more pleasant and productive,"

The paper and AP say that, though Quanta isn't a household name in the United States, it's the world's largest producer of laptops, making portable computers and other devices for the likes of Dell, Hewlett-Packard and IBM.

MIT envisions digital devices that could recognise whether a user is at home, at the office or in a car, and automatically reformat how information is presented on screen to fit the circumstances. For example, a commuter checking e-mail on the go might prefer to read snippets of e-mails rather than digest a single message taking up the entire screen, report the NYT and AP.


Verizon buys stake in MCI

Verizon Communications has agreed to buy a 13.4 percent stake in MCI that was held by Carlos Slim Helu, a Mexican billionaire, for US$1.1 billion.

The New York Times reports (10 Apr.) that the deal would solidify Verizon's takeover bid for MCI, the long-distance carrier, and deliver a setback to Qwest Communications, which has also been trying to buy the company.

Verizon said it would pay us$25.72 for each of Mr. Slim's approximately 43.4 million shares. The deal is expected to close in several weeks and will make Verizon the largest single shareholder in MCI, replacing Mr. Slim, the paper reports.

According to the NYT., Verizon, which has agreed to buy MCI for US$23.10 a share, still may sweeten its offer to acquire the rest of MCI's shares, though it is under no obligation to do so.

Regardless, says the paper, the move yesterday goes a long way toward ending a contentious two-month tug of war for MCI. The board of MCI has repeatedly accepted lower bids from Verizon, arguing that the company was a more secure partner than the debt-laden and money-losing Qwest.

But, the NYT says that many big holders of MCI's stock have supported Qwest's bid of US$27.50 because it is 19 percent higher than Verizon's current offer. Some shareholders have filed lawsuits against MCI and Qwest is widely expected to be preparing a costly and potentially bitter proxy fight.

On Friday, Qwest said that a survey conducted by a proxy adviser showed that investors holding more than half of MCI's stock favored its takeover offer. The survey, conducted by the Altman Group, did not include results from Mr. Slim, the NYT says.

According to the NYT., Qwest, the smallest of the regional Bell phone companies, has also tried to woo MCI shareholders by working to raise as much as US$2 billion from private equity firms. The firms would provide cash to Qwest in return for discounted shares that could be redeemed for a profit.

Glitches in booking online airfares

The Internet is perhaps the only place where first-class fliers are treated like second-class citizens, according to a US report issued last month by Consumer WebWatch, a division of Consumers Union, which said that people who spent the most money on airline fares must at times overcome serious technology failures in their quest to book premium tickets.

The New York Times reports (10 Apr.) that, according to Forrester Research, an internet consultancy firm, nearly 19 percent of Americans who booked tickets online last year bought domestic business or first-class tickets. The report's author, said sites had "straightened out most of the early problems they had with straight domestic fares, like functionality or showing wacky itineraries."

The paper says that the report said that US travel companies, Expedia, Orbitz and Travelocity each experienced problems with "fare jumping," when consumers in search of premium fares select a fare from search results, only to find that the price changes after they click on it and try to book it. One first-class fare on Expedia increased by US$748, from US641.19 to US$1,389.19, in less than 30 seconds. When flights are booked by phone, the price quoted is generally the price the consumer pays.

Friday, 08 April 2005 16:30

News Roundup 08 Apr 2005


Europe gains support in fight with Microsoft

Five leading technology companies are supporting European Union regulators in their legal battle with Microsoft, a lawyer for the group has said.

IBM., Oracle, Red Hat, RealNetworks and Nokia have applied to intervene against Microsoft in its court appeal of a European Union antitrust ruling last year, as reported by the New York Times (7 April).

The companies' stance counters Microsoft claims that the case by the European Commission, the union's antitrust arm, was without industry support, the NYT reports.

The paper says that with the exception of RealNetworks, which has sued Microsoft separately, the intervention of several major technology companies against Microsoft is noteworthy because they have tended to be reluctant to take such a public stand.

Red Hat is a major distributor of the open-source Linux operating system, which IBM also promotes. Oracle's chief executive, Lawrence J. Ellison, is a longtime nemesis of Microsoft, and Nokia faces a threat from Microsoft in mobile software, reports the NYT.

Microsoft has appealed at a European Union court against the March 2004 ruling in which the commission fined it 497 million euros (US$640 million) and ordered it to share technology with competitors that make server software so their products can better communicate with Windows-powered computers.

The regulators also ordered Microsoft to produce a Windows version minus its multimedia player to provide a more level playing field for competitors, the paper reports.


New version of MSN Messenger released

In its latest bid to make money on free Internet services, Microsoft is betting that consumers will be willing to use their instant messaging identities as billboards for products ranging from Sprite to Adidas sneakers.

The New York Times/Associated Press report (7 April) that the newest version of MSN Messenger instant messaging product, released late Wednesday, allows consumers to download free backgrounds, pictures and other content tied to specific ad campaigns. The hope is that users will then share those downloads with other consumers -- providing another boost to advertisers, who pay Microsoft for the privilege.

A spokesman for Microsoft's MSN online unit, said the company hopes to attract users who are so taken by the advertising campaigns that they choose to associate themselves with the brand -- much like a person might buy a Starbucks Corp. coffee mug, the paper and AP report.

The NYT and AP report that Microsoft is launching the program with German sportswear maker Adidas Salomon and Sprite, made by Coca-Cola.

An analyst with Forrester Research said Yahoo's messaging service has been providing a similar service for some time, report the NYT & AP.

Microsofty told AP and the NYT that it also is expanding other advertising functions. That includes gearing ads to users it believes are of a certain age or gender, or who live in a specific area. The company also will begin putting text ads at the bottom of instant messaging screens.

The paper and AP report that Microsoft also is releasing the official first version of MSN Spaces, a free personal web journal system that debuted in test form in December. As part of an advertising campaign, Ford's Volvo Cars of North America is debuting its own "space" that will solicit commentary from Volvo loyalists. Microsoft said Volvo will have editorial control of the posts.


Mobile trojan kills smart phones

Virus writers have created a mobile Trojan capable of rendering an infected Symbian Series 60 unusable. Fontal-A is a SIS file Trojan that installs a corrupted font file on the device, causing it to fail when the mobile phone is next rebooted.

The Register reports (7 April) that Fontal-A is a Trojan, incapable of spreading by itself or via Bluetooth. The small risk of infection applies only to people in the habit of installing warez mobile games files or the like onto their mobile phone.

According to The Register, as well as installing a corrupted font file, Fontal-A also damages the application manager so that it cannot be uninstalled. No new applications can be installed until the phone is disinfected. If the user has attempted to reboot the phone the only way to disinfect it is to reformat a mobile device, according to preliminary advice by anti-virus firm F-Secure. It warns that reformatting the phone will cause all data on the mobile to be lost, says The Register.

Mozilla has patched a vulnerability in its popular Firefox web browser that could allow hackers to snaffle information from the PCs of surfers, a ccording to a report in The Register (6 April).

The Register says that the JavaScript-related security bug, which affected versions 1.0.1 and 1.0.2 of Firefox, created a means for hackers to seize potentially sensitive information in memory.

Exploitation of the flaw, discovered by Russian bug hunter Azafran, would be far from trivial. Nonetheless security firm Secunia describes the heap buffer overflow bug as "moderately critical". It has put together a test allowing users to check whether they are exposed to the problem. Secunia advised users to disable JavaScript support as a precaution. According to a posting on Bugzilla, Mozilla has fixed the flaw. Security conscious surfers are advised to download this update, reports The Register.

The Register says a potentially far more serious unpatched security vulnerability affects unspecified versions of Microsoft's Internet Explorer and Outlook software. The vulnerability "allows malicious code to be executed with minimal user interaction", warns security outfit eEye, which recently reported the bug to Microsoft, says the publication.

Microsoft said it was not aware of any malicious attacks attempting to exploit the reported vulnerabilities, and there was no customer impact based on this issue. Upon completion of an investigation, Microsoft said it will take the appropriate action to protect its customers, which may include providing a fix through a service pack, our monthly release process or an out-of-cycle security update, depending on customer needs.


Google cuts price on search hardware licenses

Web search leader Google has said it has cut the price on licenses for its hardware that helps small and medium-sized businesses add search to their internal networks and public web sites.

The New York Times and Reuters report (6 April) that the price of an entry-level license for the Google Search Appliance will fall to $30,000 from US$32,000 and continue to include two years of customer support. That license, which is sold largely to medium-sized businesses, will allow users to search up to 500,000 documents, compared with 150,000 under prior terms.

The paper and Reuters say that the highest end license for the Google Search Appliance, a box containing both hardware and software, allows for the search of up to 15 million documents and costs significantly more.

The company also cut to US$2,995 from US$4,995 the license price on the Google Mini -- a search appliance for small businesses that was released in January. That license includes one year of support and allows holders to search up to 100,000 documents versus 50,000 documents previously, says the report.


Intel upbeat on NOR flash

Intel, the world's largest chip maker, has said it aims to extend its recent growth momentum in NOR flash memory to become the No.1 player in 2005, overtaking rival Advanced Micro Devices (AMD).

The New York Times reports (7 April) that, as part of its drive to excel in the NOR flash market, Intel, based in California, unveiled an advanced flash memory targeted at consumer electronics products such as flat televisions and digital cameras.

The paper says the Intel StrataFlash Embedded Memory, with a capacity of 64 to 512 megabits, will become available this quarter, with a 1 gigabit version set for launch in the second half of 2005.

Flash memories, which have two major subcategories -- NOR-type flash and NAND-type flash -- retain data even after power is turned off, making them an ideal rewriteable memory device for mobile and other electronics products, says the paper.

The NYT says that South Korea's Samsung Electronics dominates the NAND flash market while Intel and AMD compete neck and neck in the NOR flash market.

In 2004, Intel took 24.5 percent of the US$9.3 billion NOR flash market, just behind AMD's 25.9 percent, according to data from research firm iSuppli. But in the third and fourth quarters Intel became the No.1 player, surpassing AMD, says the paper.

Analysts attributed Intel's success to its aggressive pricing, and the company said it would maintain an aggressive stance for further growth in the flash market.


IBM and NetApp in broad alliance against EMC

IBM and Network Appliance said on Wednesday they agreed to a deal where IBM will resell a broad line of Network Appliance storage products, taking aim at corporate data storage supplier EMC and its allies.

The New York Times/Reuters report (6 April) that the companies said Network Appliance (NetApp) had agreed to use IBM's Tivoli software as a preferred method for handling storage management and would recommend IBM tape storage systems to their customers as a preferred product.

The paper and Reuters say the deal brings together Network Appliance, the market leader in so-called "network-attached storage" (NAS), with IBM, which has a broad range of storage products including the leading share of storage tape products used for archiving data.

But the move also looks set to push EMC allies Cisco and Dell closer into EMC's orbit as competition in the corporate data storage market heats up, executives and Wall Street analysts said of rival alliance, reports the NYT/Reuters.

IBM said it viewed the relationship as a strong win-win situation wherein IBM fills the NAS hole in its portfolio...and Network Appliance gains access to IBM's strong reach especially in Europe and Asia.

The NYT and Reuters say that while the deal plays to both IBM and NetApp's respective strengths, it also is designed to overcome a weakness in IBM's portfolio of storage offerings.

IBM and NetApp said they had agreed to an original equipment manufacturing deal in which IBM will be able to sell the full line of NetApp products under the IBM brand.These include network attached storage (NAS) and iSCSI/IP storage area network products sold under brand names such as NearStore and NetApp V-Series Systems, and related software. NetApp is market leader in both categories, according to IDC, the NYT and Reuters report.

However, an EMC spokeswoman said her company has seen little impact from IBM's prior effort to sell NetApp equipment. She said the new NetApp deal was the latest in a string of failed partnerships where IBM has sought to patch holes in its storage line-up with Compaq, now part of Hewlett-Packard Storage Technology and Hitachi, the NYT/Reuters report.

And, Dell said it plans to aggressively target the NAS market with EMC, Dell manufactures and resells a line of EMC storage products that is growing at roughly 46 percent a year, making it one of EMC's biggest sales partners, according to the NYT/Reuters.


TiVo acquires six US patents from IBM

TiVo, a maker of digital video recorders, has announced that it has acquired six US patents from IBM that cover interactive television, boosting TiVo's total patent portfolio to 76.

The New York Times/Reuters report (7 April) that the acquired patents cover audience measurement, the integration of internet and TV, automatic scheduling of recording, content screening, information searching and electronic program guide enhancements, TiVo said.

The paper says that TiVo, which makes its own video recorders and offers its service to users of the DirecTV satellite service, did not disclose the terms of the deal. An IBM spokesman said the patents had originally been filed for a now-defunct IBM digital video products group.

According to the NYT/Reuters, TiVo early last year asserted its intellectual property to fend off competition from satellite TV provider EchoStar Communications, which operates the DISH Network satellite TV service. The patent infringement case, covering video recording technology, is set for jury selection in October in a Texas court.

TiVo's recorders store TV shows on a computer hard drive, allowing viewers to pause live television, skip over commercials and record dozens of hours of programing, the paper and Reuters report.


US VoIP market battles: Verizon price cutting

In the US., telco Verizon Communications has launched a cheaper version of its VoiceWing Internet phone service, another move in the price wars for voice-over-Internet-protocol, also known as VoIP. repoprts (6 April) that the New York-based telecommunications giant said the new option provides 500 minutes of outbound local and domestic long-distance service for US$19.95 a month. The service, dubbed VoiceWing 500, includes unlimited inbound calls and free calls to other VoiceWing subscribers.

The publication reports that Verizon's move comes amid heated competition in Internet telephony, where rivals like AT&T Corp. and Vonage Holdings have slashed prices to lure customers. VoIP allows customers to make phone calls over broadband internet connections, usually at much lower cost than traditional phone service.


AOL launches internet phone service

America Online (AOL) has launched its internet telephone service (VoIP), jumping into a market that's already crowded with startups, cable operators and even traditional phone companies.

The New York Times and Associated Press report (7 April) that the AOL Internet Phone Service, which is being offered to AOL members and others in 40 markets at first, includes the regular features of traditional telephony and combines them with advanced services that are accessed on a PC over the Internet.

The paper says that according to AOL.,the offering "will uniquely combine advanced tools, competitive pricing plans and AOL's hallmark ease of use to allow mass-market consumers to take full advantage of the revolution underway in Internet voice technology".

The technology, known as Voice over Internet Protocol, VoIP, is being touted as the next big revolution in communications. Instead of traveling over the traditional phone system that's been around for more than a century, calls are converted to packets of data and streamed over the internet. All providers generally charge less and offer more advanced features than traditional phone companies, the paper and AP report.


File-sharing:latest battleground in clash of technology and copyright

Last week, the US Supreme Court heard oral arguments in Metro-Goldwyn-Mayer Studios v. Grokster, a case that has important implications for the future of online innovation.

The New York Times reports (7 April) that Grokster makes software that enables internet users to share computer files on peer-to-peer networks. The technology has been used to distribute many kinds of content, including copyrighted digital music.

The paper says that MGM and other entertainment companies want to hold Grokster liable for the copyright infringement that occurs when users download copyrighted music without paying for it. Grokster argues that there are many legitimate uses for its technology and that it is not responsible for those who use it to violate copyrights.

According to the NYT.,this is just the latest instalment of a longstanding battle between technology companies and copyright holders.

Web researcher to buy German rival

Greenfield Online, a US provider of internet-based market research, is expected to announce the acquisition of Ciao, a German company that provides the same services in Europe, for about US$154 million in cash and stock.

The New York Times says (7 Apil) that Greenfield, which uses internet surveys to provide feedback to market research and consulting companies, said it believed that Ciao, which is based in Munich and has offices in five European countries, was the largest independent provider of such information in Europe.

Greenfield agreed to pay about 58 million euros in cash (US$74 million) and nearly four million shares of its common stock to acquire Ciao, according to a statement about to be released.

Greenfield, said that the acquisition would help accelerate Greenfield's global growth. The company had sales of about US$44 million last year and Ciao had sales of about 18.1 million euros (US$23.3 million).


Nintendo follows Apple with retail store
The New York Times reports (7 April) that, borrowing a page from Apple's marketing playbook, Nintendo, the Japanese video game giant, will open a retail store in Manhattan this US spring.

The Nintendo World Store, which company officials say will be the first anywhere, will feature many of the company's popular video games and consoles, including the GameCube, Nintendo DS and Game Boy line.

The NT says that much like Apple Computer high-end outlets (and similar stores operated by Sony and Samsung), the Nintendo store will include high-tech trappings like interactive stations, and will provide previews of new and unreleased software, a Nintendo spokesman said.

The paper adds that the plan for the store comes as Nintendo faces new competition from Sony's PlayStation Portable, or PSP, a hand-held console that has received favorable reviews. Nintendo also has rivals in the home console market in Sony's PlayStation 2 and Microsoft's Xbox.


Intel, AMD race to be first with 2-processor chip

Intel and Advanced Micro Devices (AMD) are racing to introduce a dual-core computer chip in what could be the biggest change in PC technology in a decade.

The New York Times and Reuters report (6 April) thaty both companies have something to prove and both expect in a matter of months to launch products which essentially combine two microchips into one.

For Intel, says the NYT/Reuters report, the transition offers a chance to shake off a year's worth of missteps and delays with an on-time product introduction; for AMD, the change amounts to its best opportunity in years to take business away from Intel, its much larger arch-rival.

Having approached the limits of speed gains with traditional chips, Intel and AMD have moved to combine two chips onto a single piece of silicon, say the NYT and Reuters.

The report says the result is one chip with two cores that can operate independently -- with one, for instance, processing a television show while the other scans for viruses.

The NYT and Reuters say that Intel on Monday turned heads in the computer industry by allowing independent reviewers to publish performance tests on its first dual-core computer chip, called Extreme Edition, before it becomes officially available. The reviews were generally positive, though some noted the chip's high heat production.

AMD, which has set a "mid-year" target release for its dual-core chips, is dropping hints that the product may arrive sooner. It has told the media to expect important news at a New York event on April 21 to mark the two-year anniversary of its Opteron chip for business PCs, known as servers, says the report by the NYT and Reuters.

Last year, both Intel and AMD accelerated plans to switch to dual-core products for their Pentium and Athlon brands of microprocessors, the central chips in personal computers, the report says.

Intel's Pentium D and Pentium Extreme Edition will be used in desktop computers; AMD's dual-core Opteron chip will target servers. Then, through 2006, the companies will broaden their dual-core lines into all the major PC markets: mobiles, desktop and server.


Loophole on '.pro' web names

A company has found a loophole for selling internet names ending in ".pro" without the usual credentialing requirements, prompting complaints from the internet's key oversight agency.

The New York Times and AP report (7 April) that the Internet Corporation for Assigned Names and Numbers, or ICANN, created the ".pro" suffix in 2000 for professionals.

Lawyers, accountants, doctors and engineers in the United States, Canada, Germany and the United Kingdom could get such names if they submitted proof of their professions. So a law firm called Smith Jones could get "" It's known as a third-level domain name because it's the third from the right, say the NYT and AP.

ICANN later allowed second-level names -- such as "" -- as long as the individual or firm already has a third-level name.

But last month, EnCirca Inc. began offering second-level names without the third-level requirement and said any profession at all could get one. It also expanded the service beyond the four countries in which credentialing procedures had been established.

ICANN responded by suggesting the new service "violates the spirit of name restrictions."

EnCirca said it plans to keep offering the service unless restrictions are set, the NHT and AP report.


Dell sees $80 billion revenue within four years

Dell has confirmed its guidance for first-quarter earnings and said Wednesday that it plans to more than double its buyback of stock in the quarter. says (6 April) that the personal-computer maker also said it expects annual sales to reach US$80 billion in the next three to four years. The announcement came during Dell's annual meeting with analysts.

The online publication reports that Dell said it continues to expect earnings of 37 cents per share on sales of US$13.4 billion in the February-April period. That reaffirmed guidance the company gave 10 Feb. and matched current estimates of analysts surveyed by Thomson First Call.

Dell said it planned to repurchase $2 billion worth of stock in the current quarter, more than double its previous plans. The company said it has bought back enough stock to reduce its average share count by more than 9 percent in the past four years.

Dell predicted that revenue will grow from $49 billion to $80 billion over the next three to four years, potentially faster than analysts had predicted.

Analysts expect the company to post sales of $57.46 billion this year, $66.11 billion the next and $75.63 billion in fiscal 2008.

After nearly hitting $50 billion in sales last year, the company raised its goal from $60 billion to $80 billion in annual revenue. But as recently as February, Chief Executive Kevin Rollins declined to offer a schedule for achieving that mark.

Rollins said the company's growth and profitability would be based on defining new products and services to offer and growing faster in existing businesses. The company said Rollins would discuss the $80 billion revenue goal in more detail with analysts Thursday.

Dell has strengthened its industry-leading position in PC sales by reducing costs and undercutting rivals on price. The company has also expanded into servers, data-storage equipment, printers, consumer electronics and technology services.

After hitting a four-year high in December, the stock has fallen 9.5 percent this year through the end of regular trading Wednesday, in which the shares lost 98 cents, or 2.5 percent, to close at $38.15 on the Nasdaq Stock Market. In extended trading after the company announcement, the shares gained 48 cents to $38.63.


Qwest refuses to concede in MCI bid

Qwest Communications, the smallest of the regional Bell phone companies, is not giving up its efforts to stop Verizon Communications, its bigger rival, from acquiring MCI.

The New York Times reports (7 April) that Qwest has requested MCI's shareholder list, according to industry executives briefed on the discussions, in a move that could lead to a protracted, if uphill, proxy battle that Qwest hopes will convince those holding a majority of MCI's shares of the superiority of its bid.

MCI's board yesterday affirmed for the third time its intention to keep its less lucrative deal with Verizon, and in a statement, MCI's board said that it believed that Qwest's US$8.9 billion bid was not superior to Verizon's US$7.6 billion offer, the NYT reports.

Given the financial terms of Qwest's bid, the negative reaction from MCI customers and other considerations, the board said it was unwilling "to jeopardise the certainty of its Verizon agreement for the uncertainties surrounding the Qwest proposal," reports the NYT.

But, the paper says that MCI said it was still open to continuing talks with Qwest if it were to make another enhanced bid.

By some analysts' estimates, though, only one-third of MCI's shareholders favor Qwest's bid, making it unlikely the company could obtain the majority of votes needed to block a deal with Verizon. Qwest could also gain leverage over MCI by trying to buy a block of the company's shares, but that is only a remote possibility, the NYT reports.

Thursday, 14 April 2005 17:30

News Roundup 14 April 2005


Microsoft warning: 5 new software security flaws

Microsoft has just warned that five of new "critical"-rated security flaws in its Windows, Internet Explorer, Word and Messenger software programs could allow attackers to take control of a personal computer.

The New York Times/Reuters report that the world's largest software maker issued software patches to fix the problems as part of its monthly security bulletin, which included three other security warnings, rated at the second-highest level of "important."

Computer security experts urged users to download and install the patches, available at

The paper and Reuters say that, in addition to the vulnerabilities affecting Windows, Internet Explorer, Word and Messenger, Microsoft also issued a warning about a flaw affecting its Exchange Server software, used on networked computers to manage and store e-mail traffic.

Hackers could exploit the flaws to take control of a computer, allowing them to steal or delete information and also use infected computers as a base to launch further attacks, the report said.

The paper and Reuters say thas Microsoft has been working for the last three years to improve the security and reliability of its software under its Trustworthy Computing initiative, as more and more malicious software targets weaknesses in Windows and other Microsoft software.

Apple to start selling new Macintosh operating system

Apple Computer has just announced that it would begin selling the fifth version of its Macintosh OS X operating system later this month.

The New York Times reports (13 Apr.) that the program, which is named Macintosh OS X 10.4 Tiger and will sell for US$129, has a variety of new features and some new internal technologies, as well as improved compatibility with Microsoft's Windows.

Steven Jobs, the company's chief executive, has at earlier events given brief demonstrations of some of the new features, says the NYT., adding that on Tuesday the company described the software's new capabilities, including a file search feature called Spotlight; four-way videoconferencing and 10-way audio conferences; and a system called Dashboard that will display on the screen small functions like calculators, currency converters and airline flight schedule trackers.

The paper says that Apple plans to make the Tiger software available at retail stores on Friday, 29 April. The company first announced Tiger last June, and has now said that it had met its self-imposed deadline of making the software commercially available in the first half of 2005.

The new software is expected to have an immediate impact on Apple's revenue, according to Wall Street analysts, reports the NYT.

One analyst in the US estimated that there were about 20 million Macintosh computer users and that as many as 2 million to 3 million might be expected to upgrade their operating systems to Tiger within the next two quarters.

The NYT quotes the analyst as saying that that would generate more than US$200 million in revenue for Apple and would easily cover the software's development costs.

The paper says Tiger adds pressure on Microsoft, which is developing a new version of its Windows operating system called Longhorn. The Microsoft software is reported to have many of the same features as Tiger, but will not be available until next year.

Apple executives said that they believed the new program gave them a significant technical lead on Microsoft, the world's dominant software publisher.

The NYT says that both Apple and Microsoft have focused on adding file retrieval and graphics technologies to their operating systems. Analysts have said that this is partly a response to the growth of internet search, which has transformed the way computer users hunt for information.

The paper reports that Apple's new Spotlight retrieval feature automatically indexes information without regard to whether the information is in a word-processing document, spreadsheet, digital image or any other file type. Microsoft has a similar feature available with its MSN service and has said it plans to integrate it into Longhorn, the paper adds.


Google launches new mobile-phone services

Google has just unveiled two new services with which North American users can find local business listings or get driving directions through their cell phones.

The New York Times/Associated Press report (12 Apr.) that a new web site, Google Local, for users with XHTML-enabled browsers on their phones can search for a local business, figure out how to get there and provide a zoomable map of the area, Google announced.

The paper and AP say that users can also retrieve driving directions with text messages via Google SMS, the company added. Currently, users can send a text message with a search query and receive addresses, stock quotes, weather and movie listings.

The company said Google Local is available in the United States and Canada, while Google SMS is supported by most US wireless carriers, report the NYT and AP.


HP unveils new iPod music player

Hewlett-Packard HAS announced that it has beefed up its line of iPod digital music players by introducing models that allow users to carry more songs and store and view photos.

The New York Times/Reuters report (12 Apr.) that HP said its "Apple iPod from HP" line now includes a 30 gigabyte model and a 60 gigabyte model, and each can store up to 25,000 digital photos that can be displayed in the devices' high-resolution color screen.

The paper and Reuters say that HP sells a branded version of the wildly popular iPod, which is made by Apple Computer.The company set the retail price for the 30 gigabyte model at US$349, while the 60 gigabyte version is US$449. HP said it continues to offer an older 20 gigabyte model US$299.


Spain has EU's top supercomputer

Europe's fastest supercomputer -- an IBM that can make 40 trillion calculations per second -- has just booted up for the first time at a research center in Barcelona.

The New York Times/Associated Press report (12 Apr.) that the so-called MareNostrum computer boasts 40 teraflops of speed, which in layman's terms means it can make more calculations than a human pecking at a calculator could make in 10 million years.

The report says that its memory is equal to the combined memories of nearly 20,000 personal computers, and its storage system has a capacity of 233 terabytes, the equivalent of the information that could be found in 29 million books.

The paper and AP say that the computer is owned by the Barcelona Supercomputing Center, a consortium comprised of the Spanish and Catalan governments and Barcelona's Polytechnical University.

The computer is the fourth most powerful supercomputer in the world and the fastest of any installed in a government-owned research center that is accessible to outside teams of investigators, says the report.

The NYT and AP report that, though it's not the fastest computer in the world -- IBM's Blue Gene/L in the United States takes that honor -- the MareNostrum is unique because it's one of the most accessible supercomputers yet created. IBM hopes future supercomputers similar to the MareNostrum will make it easier for governments and public institutions to have access to these powerful machines.

Spain's MareNostrum was made entirely with components available on the open market, such as conventional blade servers, and uses a Linux operating system, the report adds.


Yahoo! chief scientist joins Microsoft

Microsoft has hired Yahoo's head of research and chief scientist Gary Flake to work on its MSN portal and desktop search, reports The Register (13 Apr.)

The Register says Flake joined Yahoo! when it acquired Overture in 2003. He wasn't there long, joining the previous year from NEC research, and most of Overture's key patents were filed before his arrival.

However, as Overture's 'chief science officer, he oversaw the growth of the company's pioneering text classified ad business that was responsible for Overture's, and later Yahoo!'s phenomenal growth.

Overture sued Google for patent violation in 2002, and Yahoo! inherited the litigation. Google settled in Yahoo!'s favor for north of $200 million last year, plus Class A voting stock, and agreed to license Yahoo's technology, reports The Register.


Verizon issuing new shares
In the US telco battle, Verizon Communications has said that it planned to issue 132 million new shares as part of its effort to buy MCI.

The New York Times reports (13 Apr.) that the information was part of a regulatory filing that started an estimated three-month process that would ultimately let MCI's shareholders vote on Verizon's US$7.6 billion takeover bid.

The paper says the filing did not include a date for the shareholder vote, which is likely to be in late June or July, given how long it typically takes to receive approval from the Securities and Exchange Commission and send out ballots .

The NYT also reports that Verizon also reiterated plans to pay US$23.10 a share for MCI despite complaints from stockholders who want at least the same all-cash offer of US$25.72 a share that Verizon agreed to pay Carlos Slim Helú, MCI's largest shareholder, for his 13.4 percent stake.

MCI's board has unanimously accepted Verizon's offer and rejected a bid from Qwest Communications worth US$27.50 a share. Qwest has withdrawn its offer but is trying to persuade MCI shareholders to reject the Verizon bid, reports the NYT.


CA's $35m tax charge hits net income

Computer Associates has said it will miss its quarterly net income target because of a US$35m tax charge it incurred by moving international profits back to the US.

The Register reports (13 Apr.) that the charge will cut CA's net income by US$0.06 per share - a substantial amount, considering the company had expected income of between US$0.07 and US$0.08 per share. However, the company said it expects to meet its other targets, and that its main revenue target remained unchanged, at US$900-920m.

Accordsing to The Register report, the company also announced that it would double its dividend payments to US$0.16 per share, to be paid out in equal quarterly instalments. The dividend program will be worth approximately US$90m to shareholders over the next year.


Private investment firm buys MusicNet venture

MusicNet, a joint venture created by the music industry to provide a legal alternative to the illegal sharing of music files, has been sold to Baker Capital, a private investment firm in New York.

The New York Times reports (12 Apr.) that the purchase price was not announced, but people involved in the transaction said it was just under US$30 million. The deal ends months of jockeying for control of the company's fate by its shareholders: Bertelsmann, EMI Group, Time Warner and RealNetworks.

The paper says that RealNetworks, an internet media company, had tried to buy MusicNet, but that transaction was blocked by Time Warner's America Online unit, two people involved in the transaction said.

MusicNet lost US$10 million to US$12 million last year, people involved in the company said, after its service was slow to take off. Its first offering allowed users to download an unlimited number of songs and play them on their computers for a fee, usually under US$10 a month.


LexisNexis data breach far worse

Data wholesaler LexisNexis, a division of Reed Elsevier, has admitted that personal information concerning 310,000 US citizens has been stolen, whereas in March, the company admitted to losing data related to only 32,000 victims.

The Register reports (13 Apr.) that it has since transpired that unauthorised users breached the system 59 times using stolen passwords, and grabbed data belonging to an additional 278,000 people.

According to The Register, the disclosure mirrors the ChoicePoint debacle, in which only 35,000 victims were acknowledged initially, a number later rounded up slightly to 100,000.

The Register reports that in less than seven weeks' time it has been revealed that, in addition to privacy invasion outfits ChoicePoint and LexisNexis, payroll handler PayMaxx, Bank of America, health care heavyweight San Jose Medical Group, California State University at Chico, Boston College, the University of California at Berkeley, and a large shoe retailer called DSW, have all lost control of sensitive data concerning millions of victims.


Robotic broadband airship soon

US communications company Sanswire has just unveiled concrete evidence of its truly audacious plan to deliver line-of-sight wireless broadband and mobile phone signals to an area the size of Texas from a single transmission point.

The Register reports (13 Apr.) that the company intends to deploy a fleet of geostationary, robotic airships hovering at a comfortable 65,000 feet above the Earth.

According to The Register and a Reuters report, the makers reckon the "Stratellite" will "change the way you communicate", according to Sanswire parent GlobeTel Communications

The Register and Reuiters report that the 245-foot-long beast costs around US$25-35m, "an absolute snip" when compared to putting a coms satellite into orbit. It's controlled by ground-based stations and relies on six GPS units coupled to the vehicle's electric motors to make sure it stays put and your signal stays nice and crisp.

A Stratellite will have a payload capacity of several thousand pounds and clear line-of-sight to approximately 300,000 square miles, an area roughly the size of Texas. However, the Company's initial plan is to use one Stratellite for each major metropolitan area, reports The Register.

The Register/Reuters say that Sanswire has almost completed a prototype of the Stratellite, but is awaiting a green light from NASA and the FAA to conduct tests over Edwards Air Force base - hopefully within the next three or four months. All being well, the Stratellite will then go into production next year, report The Register and Reuters.

Thursday, 07 April 2005 16:30

News Roundup 07 Apr 2005


IBM, Nokia, Oracle to gang up with EU against Microsoft

A lobby group backed by Nokia , Oracle and IBM has asked an EU court for permission to join the European Commission in its antitrust battle with Microsoft, it said on Wednesday.

The New York Times reports (5 April) that the five-firm European Committee for Interoperable Systems (ECIS) said the request demonstrated there was still solid industry backing for the EU executive's crackdown on Microsoft, despite settlements with some opponents.

In a landmark ruling last year the Commission found Microsoft abused the near-monopoly of its Windows computer operating system to crush competition. It fined the world's biggest software maker nearly 500 million eurosand ordered it to change its business practices, says the paper and Reuters.

The NYT and Reuters say Microsoft failed in its bid to delay the sanctions, which required it to sell a version of Windows without Windows Media Player and share software data with rivals. However, the software giant is appealing the main ruling, even as it puts in place the changes ordered by the Commission.


Intel, AMD race to be first with 2-processor chip

Intel and Advanced Micro Devices (AMD) are racing to introduce a dual-core computer chip in what could be the biggest change in PC technology in a decade, reports The New York Times/Reuters, in a 5 April report.

Both companies have something to prove and both expect in a matter of months to launch products which essentially combine two microchips into one, says the paper and Reuters.

For Intel, the transition offers a chance to shake off a year's worth of missteps and delays with an on-time product introduction; for AMD, the change amounts to its best opportunity in years to take business away from Intel, its much larger arch-rival, the paper and Reuters observe.

The NYT/Reuters say that having approached the limits of speed gains with traditional chips, Intel and AMD have moved to combine two chips onto a single piece of silicon. The result is one chip with two cores that can operate independently -- with one, for instance, processing a television show while the other scans for viruses.

According to the paper and Reuters, for some applications -- like the multimedia processing that is seen as a key path for PC industry growth -- dual core shows major gains.

Meanwhile, say the paper and and Reuters, Intel on Monday turned heads in the computer industry by allowing independent reviewers to publish performance tests on its first dual-core computer chip, called Extreme Edition, before it becomes officially available. The reviews were generally positive, though some noted the chip's high heat production.


Google and Yahoo! accused of click fraud collusion

Google, Yahoo! and other players in the search business have become embroiled in a lawsuit which involves overcharging for pay-per-click online advertising, reports The Register in the UK (5 April).

The Register reports that the Wall Street Journal says that plaintiffs in the US filed a lawsuit in February alleging that Google and Yahoo overcharge advertisers, and also that they collude with each other, to continue overcharging.

The online news service says that in the pay-per-click model used by Google, Yahoo! and Ask Jeeves , advertisers pay each time a user "clicks through" on an ad listed alongside search engine results. Each click costs on average between €0.30 and €0.50 with more popular keywords costing as much as €10 per click.

The Register says that led by an Arkansas company called Lane's Gifts and Collectibles, the plaintiffs want the lawsuit certified as a class action. They allege that the defendants, which include Google, Yahoo!, FindWhat, Ask Jeeves, America Online and Look Smart, improperly charged advertisers for incidents "click fraud".

The publication says that click fraud is a growing problem in the search industry. The practice has seen people - such as competitors or unhappy employees - click repeatedly on an ad to run up a bill for the advertiser. This can cost advertisers a lot of money and is difficult to track down.

Howewer,according to The Register, Google and Yahoo! and other search engines say they have anti-fraud systems in place and that they regularly give advertisers refunds for fraudulent clicks. However, they have been sketchy with details, causing some advertisers to worry that the problem is bigger than they are being told.

Apple now selling Mac Minis at best buy stores

Apple Computer has started selling its Mac mini computer at retailer Best Buy stores, the second large electronics retailer to carry the slim, US$499 PC. the company said on Tuesday.

The New York Times and Reuters report (5 April) that Apple rolled out the Mac mini, which is sold without a monitor, keyboard or computer mouse, in January, taking solid aim at making its products more affordable for the masses. It's the cheapest Macintosh to date.

The paper and Reuters say that the mini is aimed principally at consumers who already own one or more of Apple's popular iPod digital music players and have a Windows or a Macintosh computer at home. Apple hopes that users will want a Mac mini to manage their digital music library, movies and pictures with its iTunes digital lifestyle applications.


Ethiopia plans to expand internet access

Ethiopia, one of the poorest nations on earth, will expand internet coverage from a handful of users to the entire country in three years, the prime minister said Tuesday.

The New York Times and Aassociated Press report (5 April) that Premier Meles Zenawi said information technology lay at the heart of transforming the impoverished country where millions are dependent on foreign aid.

The government is working with US technology giant Cisco Systems to boost its coverage.

The paper and Reuters report that currently there are just 30,000 internet lines in a country of 71 million people making it one of the lowest users of information technology in the world, according to a study by the World Bank. But within six months that figure will be expanded to 500,000 lines.

The NYT reports that the government has begun laying 6,200 miles of fiber optic cables and invested around US$40 million in developing its Internet service.


Hackers add web, chat to PSP video game player

Sony's new PlayStation Portable is turning into a great tool for web browsing, comics reading and online chat -- and it also happens to play video games, movies and music, if you prefer that sort of thing, reports The New York Times and AP (5 April).

The NYT and AP report that the US$249 PSP handheld video game player went on sale in the United States on 24 March, and it took very little time before techies added the kinds of functions to the PSP that Sony did not include -- and may never have intended.

One man needed only 24 hours to get a working client for internet Relay Chat, or IRC, an older messaging platform.

The paper and  AP report that much of the new PSP functionality comes from using the web browser built into the racing game "Wipeout Pure," which was meant to go to a Sony site. By changing some of the PSP's network settings, the browser can be pointed to an internet portal.

The report says that a number of people have already set up such portals, formatted to fit in the PSP's screen and offering links and a place to enter Web addresses. The technology blog Engadget has rounded up a number of those links.

MCI rejects Qwest's takeover offer
In the US telcos mergers and acquisition battles, the board of MCI has said it is sticking by its merger agreement with Verizon Communications and rejecting a higher bid from rival Qwest Communications.

The New York Times repopertrs (6 April) that MCI's board made the decision after spending the day reconsidering Qwest's bid, which is 19 percent higher than Verizon's. Qwest had asked MCI to decide by midnight yesterday whether the company's bid was superior to the US$7.6 billion deal MCI had agreed to with Verizon.

However, the NYT reports that despite Qwest's bid being higher, MCI's board considered Verizon to be more stable and as a result, a better long-term prospect.

The paper reports that Qwest has not ruled out raising its bid again. But more likely, industry analysts say, the company will take its case to MCI's shareholders, many of whom have lobbied their board to accept Qwest's US$8.9 billion bid.

A Qwest spokesman said: "MCI's board has chosen to reject what we believe is a superior offer. The company currently is weighing its options, and Qwest and MCI shareholders will dictate the next steps in the process."

The NYT says that a showdown could come at MCI's next shareholder meeting, which is tentatively scheduled for 16 May. At that meeting, shareholders will likely have the chance to vote on whether to approve the merger with Verizon, according to proxy specialists.

The NYT says that in the intervening weeks, Qwest could try to persuade more MCI shareholders to throw their weight behind its bid and to reject the deal with Verizon.

The paper repprts that some analysts say that to survive, Qwest needs to become part of a larger entity, either by acquiring a competitor or being acquired. A merger with MCI was the company's best bet, and the remaining alternatives are either less appealing or more difficult to pull off.

Wednesday, 06 April 2005 18:30

News Roundup 06 Apr 2005


Microsoft, Linux neck-and-neck in cost study

Most US businesses say there is very little difference between the cost of maintaining a Windows versus a Linux-based corporate computing environment, according to a new Yankee Group study just released in the US.

The New York Times reports (4 April) that the main cost difference, according to a Yankee Group analyst, is determined by the amount of time it takes to develop applications or ensure the security of servers, the networked computers that store data, crunch numbers and serve up Web pages.

In the independent study, 88 percent of respondents said that the quality, performance and reliability of Windows was equal to or better than Linux.

Linux, which can be copied and modified freely, unlike proprietary software such as Microsoft's Windows operating system, has been locked in competition for the last several years against Microsoft's Windows Server software for a share of the corporate market.

The paper says that in most cases, both Linux and Windows are growing at the expense of Sun Microsystems's Unix-based servers, which were instrumental in the growth of the Internet during the 1990s.

According to the NYT., in terms of security, Yankee Group's survey showed a sharp rise in companies' assessment of Microsoft's security level, bringing it closer to perceived security level of Linux. On a scale of 1 to 10, companies rated Microsoft's security at 7.6, double the rating in a similar survey conducted last year. Linux's rating was mostly the same at 8.3.

The paper reports that, overall, most companies were content with extracting the most use out of their existing networks and adding Windows or Linux server as needed, depending on specific tasks and needs.


Microsoft meets most EC demands

Microsoft has accepted most of the conditions set by the European Commission to bring the software vendor into compliance with last year's anti-trust ruling.

Microsoft has said that there were 26 areas where the Commission wanted changes to be made and the company was able to say yes to 20 of those requests. Even on the remaining six, significant progress was made, and Microsoft is hopeful that it will get closure within the next two to three weeks.

The Register reports that Microsoft said the firm was still trying to balance protecting its intellectual property with giving open source developers the access they need to create applications which will work with Microsoft servers.

Microsoft told The register, in a ewritten statemnent, that it had undergone a thorough re-examination of the program to identify areas where the company could make changes to address the commission's concerns.

The company told The Register in its statement that "since receiving the Commission's feedback, Microsoft has been working around the clock, and has been able to make significant progress on a number of major issues in this short period of time. We continue to work at full speed on the outstanding issues and remain committed to moving forward with the implementation process as quickly as possible."

The Register says the Commission is still concerned that open source developers have been excluded, or priced out of, Microsoft's licensing programme. It wants lower license fees and longer evaluation periods.

The online publication says Microsoft offered to lengthen evaluation times from two days to eight days and dropped fees to €500 per day rather than €5,000 for one day and €7,000 for two days, according to media reports, as well as bewing prepared to consider flexible or customised licenses.

The Register further reports that Microsoft is also struggling to find a way its API's can be distributed with open source products without revealing Microsoft code, according to Infoworld.


New York lawmakers target modem hijacking

As you're clicking away at your keyboard, you may be turning your telephone modem over to internet thieves who make international calls and a profit at your expense - that's modem hijacking, reports The New York Times and ASssociated Press (5 April).

New York lawmakers on Monday announced what apparently is a first of its kind measure in the USto target the practice, which is estimated to run up millions of dollars in illicit phone calls for Americans whose service is stolen through dial-up connections from personal computers.

Observers say that the hijackers can now probably avoid the law because they flash a pop-up window for the computer user to check, authorising the downloading of modem software that then is remotely accessed to make international calls that are charged back to the unwitting computer user.

The NYT and Reuters say that New York's bill appears to be the first of its kind to target modem hijacking,and other states are considering similar, broader bills and some modem hijacking might be investigated under some states' computer-trespassing laws.

The paper and Reuters report that Verizon Communications has investigated complaints and erased the charges of countless customers thought to be victims of modem hijacking. The company also advises customers how to avoid the practice through consumer alerts and bill messages. Verizon has also sought help from federal officials.

According to the NYT/Reuters report, a profit is turned when the hijacker sells the long-distance service to overseas foreign telephone service carriers, all paid for by the computer user back home. This type of hijacking is generally not an issue for people who access the internet through cable modems or digital subscriber lines, the report says.

Modem hijacking has gained national attention in the US with the adware, spyware, dialers and similar software installed without the knowledge of its owner. Advertisers and peddlers of pornography are often behind the activity.

The paper and Reuters say that consumers can fight modem hijacking by using a dedicated phone line for the computer dial-up connection then blocking international calls to that line.


Verizon indicates it could scrap MCI bid

Verizon Communications has signaled its unwillingness to raise its US$7.6 billion offer for MCI and said it was prepared to walk away from its agreement to buy the company.

The New York Times/Associated Press report (5 April) that, in what amounted to an ultimatum, Verizon, in a letter to MCI's board, said if the board decided that Qwest's US$8.9 billion bid was "superior," Verizon would scrap the current deal.

Verizon also indicated its impatience with some MCI shareholders, who have urged the board to accept Qwest's higher offer, reports the NYT/AP., adding that a determination by MCI that Qwest's bid is better would show "that the decision-making process is being driven by the interests of short-term investors rather than the company's long-term strength and viability."

According to the NYT/AP.,despite the tough talk, Verizon could still raise its offer or let MCI's shareholders vote on the bid directly, according to industry analysts.

The paper and AP say that in an ultimatum of its own, Qwest last week asked MCI's board to decide by today whether its US$8.9 billion offer is superior to Verizon's. If MCI's board decides that Verizon's offer is stronger, Qwest said it would withdraw its offer.

The phone companies have been engaged in a two-month tug of war for MCI, the struggling long-distance carrier. Verizon is trying to keep pace with SBC Communications, which agreed to buy AT&T in January. By adding MCI, Verizon, would become a major player in the market providing services to big corporations, reports the NYT and AP.

Qwest, the smallest of the Bells, is eager to merge with MCI so it can offer nationwide services and benefit from the more than US$5 billion in net cash on MCI's balance sheet, the report adds.


Panasonic sees strong US plasma TV sales

Panasonic of North America, the US unit of Matsushita Electric Industrial, expects sales of flat panel plasma televisions to surge, reaching 1.6 million units in three years, or about one-third of the US market.

The New York Times/Reuters report (4 April) that Panasonic North America, said the company expected to report North American sales of about US$8.5 billion for the fiscal year ended March 2005.


Cisco puts US$750m into channel financing

Cisco is 'greasing credit lines' for its resellers with US$750m in extra credit for partners worldwide, reports The Register (5 April).

The Register says that along with the increased credit limits Cisco Capital is also going after small and medium businesses with an improved leasing programme.The money is split: US$250m comes direct from Cisco through 30-day accounts; and US$500m is supplied by Cisco Capital using inventory and short-term project finance to support Cisco resellers involved in projects with longer payment cycles.

According to The Register,in 2004 about 700 Cisco partners borrowed US$5bn from third parties.

The Register says that Cisco also announced the SMB Support Assistant which supplies diagnostic and troubleshooting help for smaller businesses. The company also announced improvements to its Network Assistant - a network manager for SMBs.

Cisco dealers will also be rewarded for selling more integrated application and services contracts, reports The Register, with the Solution Incentive Program supporting collaboration between application developers and networking specialists. Resellers must pre-register to qualify.

The Register reports that eligible projects must be based on Cisco kit, must include at least one business application and integration services. They must increase the need for bandwidth and they must be repeatable.


SAP extends plan to lure Oracle customers

SAP, Europe's biggest software maker, on Monday widened the reach of its plan to take away customers from rival Oracle by extending it to 6,500 Oracle customers who are not currently SAP users.

The New York Tiomes and Reuters report (4 April) that SAP dubbed the extension a "second wave" in its so-called SafePassage program to lure former customers of PeopleSoft, the business software maker bought by Oracle in January for US$10.6 billion, to SAP.

SAP's original program hatched in January was made available to Oracle's new PeopleSoft customers who also used SAP software. The extended plan announced Monday will make the SafePassage program available to those former PeopleSoft customers who currently do not use SAP software, says the NYT and Reuters.

The SafePassage plan offers cheaper prices than Oracle's on the cost of software upgrades and customer support, according to the NYT and Reuters,

A SAP America spokesman said SAP was likely to update its progress in luring away former PeopleSoft customers when SAP reports first-quarter earnings on 21 April, report the NYT and Reuters.

In late February, SAP Americas told Reuters that SAP was talking with around 200 PeopleSoft customers about switching to SAP and the company said "50 or more" Oracle customers had migrated to SAP in the past year.


Netline Open-Xchange - the next Firefox?

The open source community has been a great new source of innovative and high quality products and these are now starting to achieve success above the operating system level, reports The Register (5 April).

The Register says that according to the Mozilla Foundation, their Firefox browser has been downloaded 25 million times since its release a few months ago.

The online publication says that Firefox works fast and well, but some of its success must be due to the weakened position of its main opposition, Internet Explorer. It says Microsoft's browser is badly overdue for an upgrade - an upgrade that was derailed by Microsoft's commitments to improving the security of its software and developing Longhorn.

The Register says that open source products seem to have the best success when they tackle applications that are well defined and universally used. A prime candidate under this definition is email.

According to The Register, this month, Netline AG will launch a commercial version of its open source email product called Open-Xchange. Netline claims that Open-Xchange has 90-95 per cent of the functionality of Microsoft Exchange and SharePoint - providing most of its groupware functions including calendar, contacts, to dos, shared projects and documents, shared knowledge, forums, bookmarks, and web mail.

Netline's Open-Xchange Server is the engine behind Novell's SUSE LINUX Openexchange Server and this commercial version is currently sold through Netline's OEM partner Novell/SUSE LINUX, The Register says

The Register says that just as in the case of Firefox, there is an opportunity for Netline as both IBM and Microsoft are asking their customers to make big changes to their email platforms. As IBM and Microsoft contend with the task of transferring their customers onto new architectures, perhaps they've taken their eyes off the ball in keeping pace with collaboration innovations. Open-Xchange, for example, promises to integrate new functionality such as VOIP, IM, mobility support via SyncML, Blogs, Wikis and so on into their email application, The Register adds.

Open-Xchange is priced to cost 50 per cent less than Microsoft Exchange and is targeted at two main markets: small to medium businesses (SMBs) with 5-250 employees, which want to save costs yet still work with MS Outlook; and larger organisations of up to 5000 employees who have decided to move to Linux, The Register adds.

The Register says that most mature markets settle down to three contenders and with the email market evenly divided between IBM and Microsoft, there's a good case for additional competition. In this market the third contender is likely to be open source and could well be Open-Xchange.


Google feature incorporates satellite maps

Online search engine leader Google has unveiled a new feature that will enable its users to zoom in on homes and businesses using satellite images, an advance that may raise privacy concerns as well as intensify the competitive pressures on its rivals.

The New York Times and Associated Press report (4 April) that the satellite technology, which Google began offering late Monday at, is part of the package that the company acquired when it bought digital map maker Keyhole for an undisclosed amount nearly six months ago.

The paper and AP say this marks the first time since the deal closed that Google has offered free access to Keyhole's high-tech maps through its search engine. Users previously had to pay US$29.95 to download a version of Keyhole's basic software package.

According to the NYT/AP report, a more traditional map will continue to be the first choice served up by Google's search engine. Users will have the option of retrieving a satellite picture by clicking on a button.

The paper and AP say that the satellite maps could unnerve some people, even as the technology impresses others. That's because the Keyhole technology is designed to provide close-up perspective of specific addresses.

Google believes most people will like the convenience of generating a satellite image with a few clicks of a computer mouse. The company envisions people using the service as a way to scout a hotel's proximity to the beach for a possible vacation or size up the neighborhood where an apartment is for rent.

Google's free satellite maps initially will be limited to North America, with images covering roughly half the United States, Google said.

The NYT and AP say the satellite maps up the ante for the many challengers chipping away at Google's share of the lucrative internet search engine market by adding more bells and whistles. For instance,'s A9 search engine earlier this year introduced a feature that includes an index containing 20 million street-level photographs of building exteriors in 10 major US cities.


Emerging poularity of satellite radio in US

The New York Times carries a lengthy report (5 April) on the rapidly expanding  satellite radio market in the United States, revealing that XM Satellite Radio - the bigger of America's two satellite radio companies - added more than 540,000 subscribers from January through March.

The paper says this pushed the industry's customer total past five million after fewer than three and a half years of operation, and which analysts described as remarkable growth for companies charging more than US$100 annually for a product that has been free for 80 years.

According to the NYT.,total subscribers at XM and its competitor, Sirius Satellite Radio, will probably surpass eight million by the end of year, making satellite radio one of the fastest-growing technologies ever - faster, for example, than cellphones.

The paper says that to keep that growth soaring, XM and Sirius are furiously signing up carmakers to offer satellite radio as a factory-installed option and are paying tens of millions of dollars for exclusive programming.

Though satellite radio is still an unprofitable blip in the radio universe, the NYT says it is pushing commercial radio to change its sound. Broadcasters are cutting commercials, adding hundreds of songs to once-rigid playlists, introducing new formats and beefing up their internet offerings. A long-awaited move to digital radio could give existing stations as many as five signals each, with which they could introduce their own subscription services - but with a local flavor that satellite is hard pressed to match, the paper adds.

The NYT says that satellite networks XM and Sirius expect to begin making money in the next two years, but how big the market can become remains debatable. By 2010, analysts estimate, subscriber levels will hover anywhere from 30 million to 45 million. Some think the totals could eventually rival or surpass the 90 million people who pay for cable and satellite television.


Hitachi headstand sets new HD density record

Hitachi has demonstrated the disk industry's highest magnetic recording density yet - 230 Gb per square inch, or 356 Mb per square mm. The demo used perpendicular recording technology, and Hitachi Global Storage Technology (HGST) said it could lead to 20GB one-inch Microdrives in two years time, compared to 6GB today.

The Register reports (5 April) that the big challenge is how to shrink the magnetised grains in the media, according to HGST's chief technologist, who said: " the problem is if they get too small, they affect each other too much, plus the energy in each bit gets close to the background thermal energy of the platter - hence the super-paramagnetic effect. The limit is therefore in sight for longitudinal recording, which stripes bits over the magnetic surface and currently peaks at around 100 Gb per square inch."

According to The Register, Hitachi is not the first to demonstrate perpendicular recording though - Seagate used it to demo 100 Gb per square inch back in 2002, and last year Toshiba said it would be the first to commercialise the technology, using it to design an 80GB 1.8 inch drive. The Toshiba drives are 133Gb per square inch and 40GB per platter, and a spokesman said they will be in mass production by June this year.

Meanwhile, The Register says Hitachi is testing perpendicular recording in 2.5 inch laptop drives now, and will have products for sale by the end of this year. These won't be 230 Gb per square inch though - that's only in the lab, says The Register, adding that a 2.5 inch drive using perpendicular recording to achieve 120 or 130 Gb per square inch could still offer 75GB per platter - some 50 percent more than today's longitudinal recording equivalents.

Tuesday, 05 April 2005 17:30

News Roundup 05 Apr 2005


Telcos see future in TV programming

In the US., telephone companies are desperate to be seen, not just heard, and in the coming months, the Bell telephone companies, including SBC and Verizon, will start selling television programming in their most recent effort to crack a market in which they have had almost no presence.

The New York Times and Reuters report (3 April) that the US cable industry, meeting this week for its annual trade show, is already bracing for the assault on its prime turf.

The paper and Reuters say that to offer paid TV services, the Bells are spending billions of dollars to expand their superfast fibre optic networks and improving technology that can send video to their phone and internet customers. SBC alone is expected to spend about US$4 billion over three years to install fibre lines to reach neighborhoods where half of its 36 million customers live.

But, say the NYT and Reuters, in addition to laying new fibre lines, the phone companies also must acquire expensive programming rights, go through the tedious process of getting permission from municipalities to sell television, and master the internet-based technology that sends video programming over the same crowded network that now delivers voice and data streams.

The report says that even after making these gargantuan investments, the Bells will face formidable challenges to break into the saturated market for pay TV. To lure customers from the cable and satellite providers, analysts said, they have to offer better programming and features at a lower price compared to cable.

The paper and Reuters say the companies have little choice than to try, because cellphone carriers are chewing into the Bells' traditional landline business. And cable companies - leaders in the high-speed internet access business - are fast entering the phone market with internet-based services. To compete with cable's offerings, the phone companies are pushing to sell an array of services - internet connections, wireless and television - in a bundle.

To entice cable and satellite customers, the Bells are turning to a technology known broadly as Internet Protocol Television, or IPTV, says the NYT and Reuters.

The report says that by transmitting TV programs this way, the phone companies will be able to offer customers the ability to watch more programming on demand, use a video recorder remotely over the internet and view e-mail on their televisions, among other services.

The NYT and Reuters report that by 2009, some 7 million subscribers in the US are expected to get television programming from a phone company, according to forecasts from PricewaterhouseCoopers. Over the same period, cable subscribers are expected to fall to 64 million, from 70 million, while satellite companies can expect 32 million subscribers, an increase from 23 million now.


Yahoo raises profile With Hollywood push

Five years ago, a handful of companies with names like Pop, Pseudo and Icebox promised a future when original shows produced for the internet would replace traditional TV viewing. The dot-com bust deflated those grand ambitions.

The vision of creating unique, interactive multimedia programming for a generation weaned on video games is very much alive at Yahoo, says The New York Times/Associated Press in a 3 April report, although the paper adds that the giant internet portal isn't talking about its plans for content.

However, says the AP and the NYT., analysts suggest a profound shift may be at work, with Yahoo using its enormous reach to force Hollywood studios, among other video creators, to produce programming with the internet in mind.

Yahoo can offer up a worldwide audience of more than 300 million -- a number that some analysts say could reach 1 billion by the end of the decade, the paper and AP say.

According to AP and the NYT.,Yahoo has already forged partnerships to webcast content from other media. It showed the entire debut episode of the Showtime series "Fat Actress," starring Kirstie Alley, at the same time the episode was broadcast on cable.

AP and the paper say America Online has similarly broadcast the first episode of the WB Television series "Jack & Bobby" and features exclusive musical performances in its "Sessions AOL" series.

Yahoo said recently that 75 percent of users access the portal using high-speed connections, making it possible to stream video of all sorts, including content by individual users, the AP/NYT report.
The AP/NYT say that among other moves, Yahoo recently signed a deal to buy Canadian photo-sharing startup Flickr, which lets people upload digital photos, publish photos in their blogs and share digital photo albums. Another recently launched Yahoo site lets users search for writings, lyrics, photos and other content authored by people who want others to use their ideas as the basis for new creations -- the so-called "Creative Commons." Then there's the newly announced social networking service, Yahoo 360, AP and the paper report.

It all speaks to Yahoo executives' excitement about "micropublishing" -- letting the portal's users create content attractive to fellow users that will encourage people to hang around in Yahoo's virtual world, adds the NYT/AP.

AP and the paper say it's a vision shared by others who see a future where people aren't just passive viewers of content but participate in creating the "TV shows" of tomorrow.

An analyst at Merrill Lynch, says Yahoo is attractive to investors for its diversified revenue stream from paid search, advertising and social networking ventures.

Yahoo says it's in the earliest stages of developing its entertainment strategy and thus would not make an executive available to discuss it with The Associated Press.


Hacking Google for fun and profit

Insecure websites are not the only venues at risk from Google-hacking. Network hardware can be hacked, cached printing pages can be perused and security cameras snooped on thanks to evolutions in attack techniques that are dumbing down network attacks, says The Register in a 4 April report.

The Register saysd 'So-called Google hacking' - named after the search engine - relies on employing carefully crafted combination of search terms to unveil potentially confidential files. The technique isnot particularly recent, says The Register, but says it's evolving to become an even greater source of mischief.

Consultants at security firm, CSC, told delegates at the Black Hat conference in Amsterdam last that network defenders needed to stay on top of the latest Google-hacking techniques to keep ahead of the "bad guys", says The Register.

The conference was told that there are numerous ways to exploit vulnerabilities and mount attacks that allow access to the back end of ecommerce websites. "Google can do the same thing but puts it in hands of amateurs," said CSC. This dumbing down of cracking opens the way to numerous attacks. Hunting for credit card numbers on insecure servers or network passwords is bad enough but the problem doesn't stop there, says The Register.

The Register says that using screen grabs, a CSC consultant showed how routers with default passwords could be located and turned off. The same approach allows the cache of insecure printers to be browsed, enabling hackers to view or download potentially sensitive documents. Insecure UPS systems, time lapse security cameras and even PBX telephony systems can also be nobbled. Police reports from crimes at US universities can be searched for references to social security numbers. Nothing is sacred.

According to The Register, Google can be also used to conduct reconnaissance on vulnerable systems without sending packets to a target. Attackers can map domains or get a list of vulnerable servers using the search engine.

The online news service said that Google-hacking has been picked up as a technique by virus writers. Recent worms have taken advantage of Google to automate the search for vulnerable machines. In response, Google has started blocking "evil queries", a technique described as the "Google Dork Detection System".


World chip sales down in February

Global chip sales fell fractionally during February, the Semiconductor Industry Association (SIA) has said after revising January's total upward.

The Register reports (4 April) that some US$18.05bn worth of semiconductors were sold in February this year, down two per cent on the previous month's US$18.41bn, but up 15.8 per cent on February 2004's US$15.59bn sales.

The IT online news publication says that a month ago, the SIA said January's sales totalled US$18.27bn. The revised figure, puts the month's sales on a par with the total recorded for December 2004, but increases the decline experienced in February, a shorter month, of course.

The SIA described the figures from the first two months of the year as "encouraging" and "stronger than expected".

The Register says the SIA reported that "Relatively strong sales of PCs and cell phones have led to year-on-year sales growth for microprocessors up 11 per cent from February 2004, DRAMs up 36 per cent, and ASICs for wireless applications up 53 per cent."

According to The Register, the SIA added that those sales are increasingly coming from consumers. Over half of all semiconductors sold in 2004 ended up in consumer-oriented kit, the reporrt said.

The Register says the SIA forecast: "The overall health of the global semiconductor industry remains strong. If the current trends continue, our forecast for flat industry sales for 2005 could prove to have been overly cautious."


UK wi-fi network buys German WISP

UK Wi-Fi network The Cloud has become Germany's third-largest WISP by acquiring local player Airnyx, the company has just announced.

The Register reports (4 April) that the terms and conditions underpinning the acquisition were not made public. Both firms are privately held.

According to The Register, Airnyx was founded two years ago in March 2003, and has since built up a network of hotspots at Agip and BFT petrol stations, and other locations throughout Germany. Airnyx operates around 500 hotspots. 

The Register says The Cloud pledged the "rapid" expansion of its German network, though it declined to detail its plans and targets. All of them will become part of The Cloud's own network, which numbers more than 5000 hotspots in the UK, across a wide range of locations, including pubs, the British Library  and the Royal Festival Hall. It also operates over 50 sites in Sweden, the result of a deal struck last November with Jernhusen, the state-owned company which manages real estate associated with Sweden's rail infrastructure, including its stations.

Like the UK operation, The Cloud Germany will not only sell Wi-Fi access direct to customers but will open its network to third-party service providers. It already allows customers of T-Online, iPass, Boingo, GoRemote (aka Gric) and others to roam on its network. In the UK, The Cloud has similar arrangements with O2 and BT Openzone, reports The Register.


US blocks use of mapping system in China

The Australian mining company BHP Billiton said Friday that the United States Defense Department was blocking it from using an advanced mapping technology to search for mineral deposits in China.

The New York Times reports (3 April) that BHP Billiton has a license to use the so-called Falcon system, which was originally intended for use on United States nuclear submarines. BHP Billiton has been using the system around the world since 1999 to help find underground deposits of minerals from aluminum to zinc.

But in a meeting this week with analysts in Australia, the head of BHP Billiton's business in China, Clinton Dines, said plans to use Falcon technology in China had been rejected by the United States Navy, according to a report published in The Australian, which was confirmed Friday by BHP Billiton in Melbourne, says the NYT

The NYT reports that a Pentagon spokeswoman in Washington said Friday that the Falcon system was on a list of American munitions banned from export to China without a presidential waiver. The ban results from sanctions imposed after the Tiananmen Square massacre in 1989.


Digeo chooses Samsung to make set-top boxes

Digeo, a company that designs software for set-top boxes used with cable television systems, it set to announce that it has selected Samsung, the Korean electronics giant, to make its next generation of boxes.

The New York Times and Reuters report (3 April) that the deal is an effort by the two companies to break into a market that has been tightly controlled by Scientific Atlanta and Motorola, which both make boxes and other equipment used in cable systems.

In fact, says the report, Motorola made the first box that ran the Digeo system, which is currently used in some cable systems owned by Adelphia Communications and Charter Communications. Charter, like Digeo, is controlled by Paul G. Allen, a co-founder of Microsoft.

The paper and Reuters say that the cable box market is expected to expand as more people move to digital cable service, which requires sophisticated boxes. So far, the market has proved difficult to crack, despite major efforts over the years by Sony, Panasonic and Pioneer to sell their devices to cable companies. Samsung, a leading maker of cable boxes in South Korea, has tried in recent years to sell its devices to cable systems in the United States, the report adds.

Samsung said the deal with Digeo lets the company get into the market sooner rather than later, the paper and Reuters report.

The NYT and Reuters say that a spokeswoman for Motorola declined to comment on Di-geo's deal with Samsung, but said that the Digeo boxes represented less than 2 percent of its shipments in the fourth quarter.

The report says that Digeo's software allows a box to record video on a hard drive, play DVD's and games, and organise music and video. It has technology that allows users to link its boxes with a simpler box in another room that could play programs recorded on the more sophisticated box's drive. This feature, according to analysts, could give cable companies a way to counter satellite services, which have offered inexpensive multiroom packages.


'Podcasts' catching on with iPod owners: survey

The home-brewed audio programs known as "Podcasts" are catching on with people who own iPods or other digital-music players, according to a survey just released.

The New York Times and Reuters report (3 April) that 29 percent of US adults who own MP3 players like Apple Computer's iPod say they have downloaded podcast programs from the internet, the Pew Internet and American Life Project found.

That means more than 6 million people are listening to a form of communication that emerged only last year, according to the nonprofit group, says the NYT and Reuters.

The paper and Reuters report that podcasters create radio-like programs of commentary, music or humor, which are saved in MP3 audio format and posted online. Listeners are automatically notified when a new podcast is available.

Podcasts have grown in prominence along with weblogs, the online diaries that serve as alternative news sources, say Reuiters and the NYT., adding that nearly half of digital-music player owners younger than 29 years old have tried out podcasts, the survey found, compared with 20 percent of those 29 or older.

The Pew Internet and American Life Project based its survey on telephone interviews with 208 digital-media player owners in the US.

Monday, 04 April 2005 17:30

News Roundup 04 Apr 2005


MCI to reopen merger talks with Qwest, again

MCI has just announced that it would reopen merger talks with Qwest Communications International, which bid US$8.9 billion for the company on Thursday.

The New York Times reports (2 Apr.) that MCI's board agreed this week to be bought by Verizon Communications for $US7.6 billion, and has started making the necessary filings with regulators. But Qwest continues to lobby for its higher bid, which it has revised three times and which is now 19 percent higher than Verizon's.

The paper says MCI has said it received permission from Verizon to talk with Qwest "until the date of the MCI shareholder vote on the proposed Verizon transaction."

Qwest, meanwhile, has asked MCI to decide by 5April whether its bid is "superior" to Verizon's offer. If MCI determines that Qwest's bid is superior, Verizon could raise its own offer or take its case directly to shareholders for a vote. MCI would have to pay Verizon US$240 million if it scrapped its current deal and sided with Qwest, says the paper.

Despite having a deal in place, Verizon has allowed MCI to continue talks with Qwest to minimise any potential legal challenges.

MCI has chosen Verizon because it believes that the company, the nation's largest telecommunications carrier, has better long-term prospects, the NYT reports.

Qwest, however, is willing to pay US$1.3 billion more than Verizon for MCI. On Thursday, the company offered US$27.50 a share, with US$13.50 in cash and the rest in stock. Verizon has offered US$23.10 a share, US$8.35 in cash and US$14.75 in stock.

The NYT says that though Qwest's offer is higher, investors remain skeptical about the company's prospects and its financial health. Qwest's current bid is 35 percent more than its market capitalisation and it is far more debt-laden than Verizon.


Google doubling storage on free email service

Google, the internet search engine company, is doubling the amount of storage offered on its e-mail service and plans to remove limits on message capacity as it competes for users with Yahoo Inc.

The New York Times rerports (2 April) that users of Google's service will be able to store two gigabytes of e-mail messages, double the storage previously offered, the director of the company bhas said. One gigabyte, or 1,024 megabytes, is roughly equivalent to the content in 32 feet of shelves filled with books.

The paper says Google will continue to increase e-mail storage in the next few weeks. It introduced its service, Gmail, a year ago and it has become the fourth-most-visited e-mail service on the web. Gmail allows users to search through messages using keywords and links advertisements to the contents of e-mail messages.

Yahoo said last week that it would quadruple the amount of e-mail storage it offers, to one gigabyte. Yahoo's e-mail service was the web's most popular in February, with 40.5 million visitors, according to New York-based NetRatings, which tracks web use. America Online e-mail was second, with 34.6 million, and MSN from Microsoft was third, with 28.4 million.


Intel: US high taxes could send plant overseas

The president of Intel, Paul S. Otellini, has warned a federal panel in the US that because of high tax rates in the United States, his company may build its next US$3 billion semiconductor factory overseas.

The New York Times reports (1 April) that Mr. Otellini, who will become Intel's chief executive in May, testified Thursday at a hearing of the President's Advisory Panel on Federal Tax Reform that over the 10-year life of a modern chip factory, the company would save US$1 billion byplacing the factory in Asia or Europe rather than in the United States.

The Intel chief said that there would be some advantages to building in the US, near Intel's other factories, but while trade barriers and wage factors were significant issues in earlier decisions, taxes are now an important consideration.

"The problem that we have and which the industry has is that it costs us US$1 billion more to operate inside the US than outside of the country," he said. "It's not wages and capital; its almost all attributed to tax benefits - or the lack thereof - in the United States compared to what is offered elsewhere," the paper reported.

The NYT says that while 12 of Intel's 16 factories are in the United States, 75 percent of its sales are outside the country.

An industry analyst said Intel's decision was being closely watched by its competitors.

Mr. Otellini said that while there are some state-level incentives for locating factories in the United States, they are insignificant when compared to the 35 percent federal tax rate the company faces.

In contrast, Mr. Otellini pointed to Israel, which offers a 20 percent capital grant, a 10 percent tax rate and a two-year tax deferral. Malaysia offers a 10-year tax deferral and Ireland offers a 12.5 percent tax rate. Two-thirds of the most advanced factories being built, those producing 300-millimeter chip wafers, are in Asia, Mr. Otellini said, reports the NYT.

HP's new chief: no plans but says all is on the table

Several Wall Street analysts upgraded the stock of Hewlett-Packard last Wednesday even as the new chief executive, Mark V. Hurd, told employees and investors that it would take time to decide what needed to be done to turn around the company.

The New York Times reports (1 April) that Mr. Hurd, whose selection as chief executive was announced on Tuesday, said on Wednesday that it was too soon to tell whether a turnaround plan would include a strategy shift, a breakup of the company or layoffs.

Mr. Hurd, said it would take time to acquaint himself with the challenges facing the company's five divisions, but he would not rule out anything that might be necessary to put the company back on track.

Mr. Hurd said the board had given him license to put in place whatever changes he saw fit. "There are no preconditions from the board that I have to do this or do that," he said.

Mr. Hurd, who until Tuesday was chief executive of NCR Ohio, arrives at Hewlett less than two months after the board ousted Carleton S. Fiorina in the face of declining profit, says the NYT.

Wall Street analysts generally applauded Mr. Hurd's appointment, some responding with upgrades. Analysts have speculated that Hewlett may decide to break up the company to make it more profitable.


PC makers offer full Windows version in Europe

The world's two largest PC makers said on Friday that they expect mostly to sell machines with full version of Windows in Europe despite a European antitrust order forcing Microsoft to offer a stripped-down version of its flagship operating system.

The New York Times/Reuters report (1 April) that after weeks of legal wrangling, the world's largest software maker had agreed to sell a version of its operating system called "Windows XP Home Edition N" without software for playing music and videos. Microsoft's Windows runs on more than 9 out 10 PCs in the world.

The paper and Reuters reports that the European Union's top regulatory body ruled last year that Microsoft had abused its monopoly status and ordered the company to pay a US$650 million fine and offer an alternate version of Windows in order to encourage more competition from audiovisual software programs from RealNetworks and Apple.

But Dell, the world's largest PC maker, said on Friday that it had no plans to sell PCs in Europe without Microsoft's audiovisual software, called Windows Media Player, the NYT reported.

Hewlett-Packard Co's vice president for Europe, Ingo Juraske, told The Wall Street Journal Europe that the world's No. 2 PC maker will offer both versions of Windows in Europe, but doesn't expect many customers to opt for Windows XP Home Edition N," reports the NYT.

The paper/Reuters say the vast majority of Windows sales are made when hardware makers sell a PC running the operating system, rather than directly from retail store shelves.

Microsoft has said that it will offer the alternative version of Windows for the same price, which could become a major sticking point with the European Commission if they find that it goes against the spirit of competition, analysts said, reports the NYT.


Microsoft sues alleged ID thieves

Microsoft last Thursday filed 117 US federal lawsuits against unnamed defendants, accusing them of a high-tech form of identity theft known as "phishing."

The New York Times/Associated Press repprt (1 April) that the lawsuits, filed in US District Court for the Western District of Washington, accuses the "John Doe" defendants of using mass e-mail or pop-up ads to coerce consumers into revealing personal information such as bank account information, passwords or social security numbers.

The company said it filed the lawsuits in hopes of uncovering some of the largest operators, report the NYT & AP., saying that in phishing scams, the internet-based communications often purport to be from legitimate organisations, such as banks, and use that perception of a trusted relationship to get people to reveal personal information.

The paper and AP say that to avoid such identity theft, experts warn that users should be wary of giving out any personal information via e-mail or pop-up ads, especially if someone contacts them unexpectedly. Users also should be wary of clicking on e-mail links, which could divert a user to a malicious site that will then steal personal information.


Mobile carriers want cheaper anti-piracy software

A powerful group of mobile telecoms operators has called for lower prices for essential anti-piracy systems, warning that high royalty payments may stifle the markets for digital music and video.

The New York Times/Reuters report (1 April) that the mobile phone industry's Open Mobile Alliance (OMA) has developed an open standard for anti-piracy software, but the technology used by the standard is too expensive, said the GSM Association of mobile operators.

According to the paper and AP., the association threatened to abandon the open standard and called for new, cheaper digital rightsmanagement systems, although this could mean fragmentation that would prove frustrating for consumers.

The paper says that the operators' complaints follow similar grumbling by manufacturers of mobile phones and consumer electronics, who told Reuters in late February that a US$1 royalty per mobile device was too high a price just to protect digital music and video against illegal copying.

If handset makers had put anti-piracy protection software in all 684 million mobile phones sold last year, the US$684 million in royalties would have exceeded total digital music sales on the web for the year, according to the NYT.

Industry players said the complaint from the GSM Association, which groups the world's biggest mobile operators such as Vodafone, adds significant pressure on the patent holders, the paper and APreport.

The paper says that the Open Mobile Alliance's anti-piracy technology is the first open standard that can be used by all electronics goods makers.
Other technologies are owned and controlled by individual companies such as Apple Computer, for its iTunes Music Store, and Microsoft.


Scammers fined £1.3m

Sixteen premium rate services have been fined a total of £1.3m following a crackdown on rogue operators over the Easter weekend.

The Register reports (1 April) that last week ICSTIS warned users to be on their guard against dodgy operators using illegal Automated Calling Equipment (ACE) after receiving credible market intelligence that scamsters were to step up their operations over the long weekend.

After, it announced that it used an "unprecedented level of sanctions" to deal with 16 services using ACE to tell people they had won a cash prize or holiday. Those who fell for the scam ended up phoning expensive phone numbers but received nothing, says The Register.

The Register says that using emergency powers the watchdog shut down the offending services and in some cases managed to freeze the income of some of the operators. ICSTIS had also notified monster regulator Ofcom over the role of one telephone company - Allied Telecommunications - because it was involved in all 16 rogue services.


Red Hat Q4 sales soar

Red Hat is to buy back more shares after reporting a record fourth quarter. The Linux distro pulled in revenues of US$57.5m for the three months to 28 February 2005, 56 per cent up on last year, and net income of US$11.8m, 200 per cent up on Q4 04, reports The Register (1 April)

The Register reports (1 April) that Enterprise subscription revenue was US$45.4m, 92 per cent higher year on year. According to Red Hat this vindicates the firm's recurring revenue model, which generates six times more turnover than that of the number two Linux provider (presumably Novell/SUSE). It bases this estimate on "publicly available information".

Revenues for the full year, FY05, were US$196.5m, up 58 per cent on FY04, and net income was US$45.4m.

Accordsing to The Register, the company ended the year with cash and investments of US$928m, and that was after spending US$54.8m to repurchase stock. Deferred revenues looks good too, with the company owed US$137.3m at the end of the year. This is 86 per cent higher than the end of FY '04.

For the full year, Red Hat reports cash flow from operations of US$122.2m, 100 per cent more than FY04. The company is to buy up to another US$150m in shares and retire US50m in debentures, to offset dilution caused by employee stock options and convertible debt, says The Register.


Pentagon redirects research dollars

In the US., the Defense Advanced Research Projects Agency at the Pentagon which has long underwritten open-ended "blue sky" research by the America's best computer scientists - is sharply cutting such spending at universities, researchers say, in favor of financing more classified work and narrowly defined projects that promise a more immediate payoff.

The New York Times says (2 Apr.) that hundreds of research projects supported by the agency, known as Darpa, have paid off handsomely in recent decades, leading not only to new weapons, but to commercial technologies from the personal computer to the internet. The agency has devoted hundreds of millions of dollars to basic software research, too, including work that led to such recent advances as the web search technologies that Google and others have introduced.

According to the paper, the shift away from basic research is alarming many leading computer scientists and electrical engineers, who warn that there will be long-term consequences for the nation's economy. They are accusing the Pentagon of reining in an agency that has played a crucial role in fostering America's lead in computer and communications technologies.

University researchers, usually reluctant to speak out, have started quietly challenging the agency's new approach, says the NYT., with the researchers asserting that Darpa has shifted a lot more work in recent years to military contractors, adopted a focus on short-term projects while cutting support for basic research, classified formerly open projects as secret and placed new restrictions on sharing information.

The paper reports that Darpa officials have acknowledged for the first time a shift in focus. They revealed that within a relatively steady budget for computer science research that rose slightly from US$546 million in 2001 to US$583 million last year, the portion going to university researchers has fallen from US$214 million to US$123 million.

University scientists assert that the changes go even further than what Darpa has disclosed. As financing has dipped, the remaining research grants come with yet more restrictions, they say, often tightly linked to specific "deliverables" that discourage exploration and serendipitous discoveries, the NYT reports.

The NYT says the concerns are highlighted in a report on the state of the nation's cybersecurity that was released with little fanfare in March by the President's Information Technology Advisory Committee. Darpa has long focused on long-term basic research projects with time horizons that exceed five years, the report notes, but by last year, very little of Darpa's financing was being directed toward fundamental research in the field.


Mobile service in Turkey gets another bidder

Alfa Telecom, a Russian mobile phone investment company, has said that it has outbid its Swedish rival, TeliaSonera, for a stake in Turkey's largest cell network, Turkcell. But TeliaSonera said it believed that its bid would prevail.

The New York Times rerports on a report by The Herald Tribnune (2 April) in which the paper said TeliaSonera has said it has agreed to pay US$3.1 billion for a 27 percent stake in Turkcell, which would raise the Swedish company's stake to a controlling 64.3 percent.

Last wseek,however, Alfa said it had topped that offer, without elaborating.

A spokesman for TeliaSonera, said his company believed that its bid would prevail because as a major investor in Turkcell it has the right of first refusal on all new shares, says the paper.

According to the Herald Tribnune and the New York Times, because TeliaSonera is bidding to raise its stake to 64.3 percent of Turkcell's shares, not the entire company, the bid needs approval from Turkey's capital markets board regulator, which usually requires companies acquiring majority control to buy out all minority shareholders.

The dispute over Turkcell comes three weeks after TeliaSonera, which is based in Stockholm, and Alfa Telecom, part of Russia's Alfa finance group, intensified their scuffling over ownership in MegaFon, Russia's No. 3 mobile network operator, report the papers.


LG & Matsushita reportedly settling plasma dispute

The world's No. 1 and 3 suppliers of plasma panels, the key component in flat-screen televisions, have agreed to settle their dispute over plasma display technology, a newspaper said on Saturday.

The New York Times/Reuters report (1 April) that South Korea's LG Electronics and Japan's Matsushita Electric filed lawsuits against each other last year, claiming infringements on patents related to plasma technology. The suits have led to a halt of imports of LG panels into Japan and Matsushita panels to South Korea.

The paper and Reuters say that the tussle has been just one of a number of legal disputes over panel technology among Japanese firms and rivals from South Korea and Taiwan, underscoring a fierce fight for position in the potentially lucrative market for flat panel TVs.

According to the paper and Reuters,the two companies have been holding talks and are expected to agree on a settlement that would require LG to pay royalties to Matsushita while allowing each firm access to some of the other's patents.

The paper and Reuters further report that Research firm DisplaySearch said LG was the world's top supplier of plasma panels in the October-December quarter with a market share of 23.6 percent in revenue terms. Samsung SDI Co. Ltd. was second with a 22.8 percent share and Matsushita was third with 21.7 percent of the market.

Plasma panels are the key component in plasma televisions, a market which DisplaySearch expects to more than quadruple in size to 12.3 million sets globally by 2008 as consumers trade in bulky cathode-ray tube models for sexier flat screen TVs, the NYT reports.

After five months of fighting, LG has shown a willingness to pay some royalties and Matsushita believes it can settle the case without compromising its tough stance on protecting its intellectual property, the Nihon Keizai said, reports the NYT and Reuters.

LG, for its part, feels it is best to settle now before the dispute escalates. The South Korean maker is concerned about the damage it might incur if Matsushita decided to file a suit against it in the US market, the newspaper said.


BT faces fading market share

BT should see its dominance of the UK's residential fixed line market evaporate over the next ten years according to boffins at Research Analysis and Knowledge Management,says the register 1 April

The register says the research group predict that BT Retail's share of the UK's fixed line market will fall from 82 per cent to 45 per cent over the next decade as increased competition begins to bite.

At the moment, around 93 per cent of UK households have a fixed line, with eight in ten supplied by BT. But as more and more punters switch providers - and increasing numbers of telcos bundle line rental with their tariffs - BT's share of the market is predicted to slide, says the Register.

According to The Register, the development of wholesale line rental (WLR) should accelerate BT's declining market share. In essence, WLR means consumers who opt for other phone providers can pay for their calls and line rental in one single bill as opposed to having to pay for calls (to a telco such as Tele2, Carphone Warehouse or One.Tel, for example) and line rental (to BT) separately.

Friday, 01 April 2005 17:30

News Roundup 01 Apr 2005


Microsoft releases server security upgrade

Microsoft has just released a major security update for Windows Server 2003, the latest in the software company's efforts to better safeguard its clients from internet-based attacks.

The New York Times and Associated Press report (30 Mar.) that the update, aims to add more security tools for Microsoft's server software, which businesses use to provide services for multiple users on a network.

The paper reports that Microsoft has said that many of the changes are geared toward making it easier for companies to manage their systems' security options. The updates include a tool that blocks all incoming traffic to the server until the latest patches have been applied, or the system's administrator has decided to allow such contact to resume.

According to the NYT., Microsoft also introduced a "security configuration wizard" that makes it easier for system administrators to set up a server for a specific function, such as e-mail or Web use, in the safest possible manner.

The paper says the upgrade also incorporates many of the fixes from Windows XP Service Pack 2, a major upgrade for Microsoft's desktop operating system that was released last year. As with that upgrade, the risk for users is that the changes accompanying such security fixes will actually cripple much-needed business applications. The company says it has been testing the security fixes extensively, in the hopes of lessening the chance of such compatibility problems.

The NYT and AP say the upgrade comes nearly two years after Microsoft first released the server software, and amid what the company concedes are complex and ever-changing security problems.


Growing tech companies keep hiring

The fastest-growing tech companies plan to keep hiring and growing despite an uncertain economic and political climate, a US study finds.

The New York Times and Associated Press report (30 Mar.) that the vast majority of the chief executives at those companies say they plan to expand their work force. About two in five say they plan to add 25 percent or more employees in the next 12 months. About one in five say they plan to add more than 50 percent.

The paper and AP say that Deloitte & Touche LLP conducted the survey earlier this year based on its annual ranking of the 500 fastest-growing tech companies in North America. In all, 150 CEOs, or 30 percent, responded to the survey that has just been released.

According to the report, tech CEOs are focused on facilitating ... growth by improving internal operations and hiring and retaining talent, rather than on external issues, such as economic conditions and geopolitical instability.

The NYT and AP say that a quarter of the respondents credited high-quality workers as the greatest contributor to company success, and a similar number cited recruitment and retention as the biggest operational challenge. Most of the CEOs say they are "extremely" or "very" confident about future growth.


IBM cell chip for industry, not just gamers

IBM is taking the highly anticipated cell chip technology at the heart of the future Sony PlayStation and offering to help customers design it into a far wider range of electronics, from aerospace to military to medical products, the company has just announced.

The New York Times and Reuters report (320 Mar.) that "cell" is a next-generation microprocessor aimed at the home entertainment market that is being jointly developed by IBM, Sony and Toshiba.

The paper reports and Reuters that analysts expect the closely guarded chip development to be used in Sony's forthcoming "PlayStation 3" gaming console and in a line of advanced television sets from Toshiba, but until now it had not been targeted at other markets.

The NYT and Reuters say that while working jointly to develop Cell, IBM, Sony and Toshiba are allowed to separately market the resulting chip to their respective customers, according to an IBM spokesman.

IBM said it plans to help customers embed the Cell chip in electronics that require vivid graphic or video processing, among other functions.

According to the NYT and Reuters, while details remain sketchy, Cell is seen by analysts as promising in coming years to offer formidable competition in consumer electronic mass markets that Intel, the world's top computer chipmaker, also covets. Early test data shows Cell able to churn data at speeds above 4 gigahertz, or billions of cycles a second, ahead of the fastest Intel chips.

The NYT and Reuters say that besides offering breakthroughs in graphics and video image processing, Power chips already offer the two-chips-in-one "dual core" capacity that Intel is racing to introduce later this year in a new brand aimed at home electronics products.


US telco battle for MCI continues

In the US, telco mergers and acquisitions continue to dominate much of the technology news, with Qwest Communications International expected to announce that it is once again raising its bid for MCI as it tries to wrest the company away from Verizon Communications.

According to the New York Times (31 Mar.), a person briefed on the Qwest board's deliberations has revealed the potential move by Qwest, saying that
Qwest has also hired a proxy adviser, the Altman Group, that could help it take its takeover effort directly to MCI's shareholders.

The NYT the moves came a day after MCI's board accepted a sweetened bid from Verizon worth US$7.6 billion, even though Qwest had offered US$8.4 billion. Verizon's latest offer is US$850 million more than its original bid, but it is still 10 percent lower than Qwest's proposal.

The paper said Qwest's board met yesterday to discuss what action to take after MCI's embrace of Verizon's offer.

Qwest has tried several times since February to persuade MCI to abandon its agreement with Verizon, and it has waged a public campaign to win over MCI shareholders. Some of those shareholders have urged Qwest to continue fighting and have taken their battle to court, filing a lawsuit in the hope of forcing MCI's board to accept the highest bid, says the paper.

The papewr says Qwest could raise its bid again by adding more stock or cash to its offer, or strengthen the provisions protecting shareholders from a decline in Qwest's shares. Qwest could also wage a proxy fight that would allow MCI's shareholders to vote on the company's offer. MCI would have to pay Verizon a US$240 million breakup fee if it called off the deal.


System for tracking  PDF documents

A Canadian company has developed a system for businesses to track PDF documents in much the same way they can keep tabs on Web visits.

The Associated Press and the New York Times report (30 Mar.) that before, businesses could count the number of times documents were downloaded, but they had no way of knowing whether the files were passed around or even opened.

The paper and AP says that with the service from Remote Approach, companies can insert a small programming script into documents using the popular Portable Document Format from Adobe Systems.The script sends a message over the internet with such details as the file name, the computer's Internet address and any unique identifier the company might have included.

The NYT/AP report says that Remote Approach is also working on a feature that would let a company block a document from being read if there's no internet connection. Another feature in the works would allow tracking on a page-by-page basis.

According to the report, privacy and security experts say the PDF tracker doesn't appear worse than what's already done elsewhere, but there are worries about any requirements to be constantly online.


Indian software testing outsourcing boom

Testing software to ferret out bugs that drive consumers crazy was once seen as dull and dreary work to be shunned by brainy technology experts, says the New York Times and Reuters in a report on the outsourcing industry boom.

But, say the paper and Reuters, the need to ensure electronic products' quality has spawned the latest hiring boom in the US$16 billion outsourcing industry that already employs some 500,000 people in India's technology capital.

The paper and Reuters say that software glitches are estimated to cost nearly US$60 billion a year in the United States alone, according to the National Institute of Standards and Technology. Companies such as online share brokers and handset makers are willing to spend a lot to avoid them.

According to the report in the NYT.,for a long time, giants like Microsoft did their testing in-house. But analysts say independent experts are increasingly being sought out to ensure neutrality and to keep costs down. A key sign of the new wave was sounded last year when India's Aztec Software and Technology Services acquired privately held testing firm Disha Technologies for US$12 million, says the report.

The NYT and Reuters report that Tata Consultancy Services and Infosys, which rank ahead of Wipro in Indian software sales, acknowledged testing was a growing business, but declined to provide details, citing the quiet period ahead of quarterly results.

Meanwhile, the NYT and Reuters report that Aztec officials say some US$3.0 billion of US$4.6 billion in outsourced testing is sent offshore, throwing up opportunities for companies in India that thrive on low-cost knowledge workers.

Reuters reports that industry estimates say Bangalore alone would need 10,000 testing engineers in the next six months. The city is pulling talent from northern cities such as Delhi and Pune by doubling annual salaries to 800,000-1,000,000 rupees (US$18,265-US$22,831) for those with 6-8 years' experience, according to Aztec.

MarketWatch creator hired by CBS

The CBS division of Viacom, which lost last year in its bid to acquire the financial news web site CBS MarketWatch, has just announced that it has landed a critical component of the business after all.

The New York Times rerports (31 Mar.) that the network said that Larry S. Kramer - who created the site, then known as, in the mid-1990's - would become president of a new division to be called CBS Digital Media.

The paper says that at CBS, Mr. Kramer will oversee the content and sales of the network's disparate web sites, including,, and  Previously, each of those sites was operated within their respective divisions at CBS.

The NYT says that Mr. Kramer, a former newspaper editor, is no stranger to CBS. He created MarketWatch for the Data Broadcasting Corporation in 1995. Later, Data Broadcasting formed a joint venture with CBS and took the new Web company public.

Dow Jones & Company, publisher of The Wall Street Journal, acquired MarketWatch in January for US$519 million, reports the NYT.


EBay names BBDO to replace Goodby

EBay has announced that it has selected advertising giant BBDO Worldwide in New York, part of the Omnicom Group, to replace another Omnicom agency, Goodby, Silverstein & Partners in San Francisco, which had worked for eBay since 1999. EBay unexpectedly dismissed Goodby, Silverstein late Tuesday.

The New York Times reports (31 Mar.) that EBay spent an estimated US$80 million last year on advertising in major media, according to TNS Media Intelligence.

The paper says the dismissal of Goodby, Silverstein came about a month after eBay named William C. Cobb its president for North America. Mr. Cobb has worked with BBDO New York twice before, when he was at Pizza Hut and Netpliance.

Thursday, 31 March 2005 17:30

News Roundup 31 Mar 2005


Microsoft Works on new ID system for Windows

Microsoft will build software for managing identities into Windows in order to beef up security by giving users more control over their personal information, the world's largest software maker said on Tuesday.

The New York Times and Reuters report (29 Mar.) that the ID technology called "info-cards" will give users more control over their own personal information in order to shop and access services online, said Michael Stephenson, director in Microsoft's Windows Server division.

The paper and Reuters say Microsoft is currently working on a new Internet Explorer Web browser and version of Windows, code-named Longhorn, but Stephenson declined to say whether "info-cards" would be built into the current Windows XP version or Longhorn.

The initiative is the latest effort by the software giant to improve the reliability and security of its software. Identity theft has become a growing concern in the United States as personal data is increasingly used to make purchases, and log into web sites for vital information and services, says the NYT and Reuters.

The paper and Reuters say the US government is considering greater regulation of data brokers following a rash of break-ins and other data losses that have heightened concern about identity theft -- a crime that costs consumers and businesses an estimated US$50 billion annually.

According to the paper and Reuters, the technology proposed by Microsoft is reminiscent of two software tools detailed by the Redmond, Washington-based company in 2001 called Passport and Hailstorm.


AMD to reveal 'Pacifica' processor virtualisation spec

AMD will next month detail its answer to Intel's Virtualisation Technology (VT) with the publication of its AMD64 platform's virtualisation system spec.

The Register reports 30 ar.) that Dubbed Pacifica, the technology will allow AMD's 64-bit server, desktop and mobile processors to host multiple operating systems - or many instances of the same OS - simultaneously. It's a technique well established in the 'big iron' mainframe world, but one makers of chips for low-end servers are keen to adopt, the better to eat into mid-range to high-end system sales.

The online publication says Intel has been touting such a system for the last 18 months or so, and in January this year brought VT's desktop release forward to this year from 2006. According to Intel's internal roadmap, it will ship updated Pentium 4 processors next quarter, and these are expected to sport VT.

Accordng to The Register, AMD first mentioned Pacifica last Autumn, and it's clearly chasing Intel. Now, it has said Pacifica will be implemented "by introducing a new model and features into the processor and memory controller" of its AMD64 CPUs. The first chips to incorporate them will appear in "the first half of 2006", AMD said. Pacifica will be applied to both single- and dual-core processors.


HP: break with style, not with strategy

Hewlett-Packard once went for flamboyance and style with Carleton S. Fiorina, the chairwoman and chief executive who was fired in February.

On Tuesday, the company chose to return to its traditional low-key management approach in naming Mark V. Hurd, the little-known president and chief executive of NCR, a maker of computers and automated teller machines, to succeed Ms. Fiorina, reports The New York Times (29 Mar.).

The paper says the appointment of Mr. Hurd, who led a turnaround at NCR through operational improvements and cost-cutting, underscores the Hewlett-Packard board's commitment to a growth strategy led by an expansion into consumer electronics.

According to the paper, Wall Street was enthusiastic about the choice of Mr. Hurd, 48, as a steadying influence to lead Hewlett-Packard, which experienced disappointing profits in the last four years. Its shares rose US$1.99, or 10 percent, to close at US$21.78 on Tuesday, though a formal announcement of the appointment was not made until after the markets closed.

The chairwoman of Hewlett-Packard, Patricia C. Dunn, said that the appointment of Mr. Hurd was a strong statement that the company did not intend to unravel its merger with Compaq or sell off other major pieces of its business, says the NYT.

The NYT says the challenges Mr. Hurd now faces are substantial. Hewlett-Packard is in fierce competition with IBM in the market for corporate information technology services. It is also in a bruising fight with Dell Computer in the PC market and increasingly in the printing business, one that Hewlett-Packard has long dominated.


MCI yes again as Verizon sweetens bid
MCI has accepted a sweetened takeover offer of about US$7.6 billion from Verizon Communications, spurning a rival bid of US$8.45 billion from Qwest Communications International.

The New York Times reports (29 mAR.) that Qwest declined to say whether it would raise its own offer, which it has already bumped up twice. Qwest's board is scheduled to meet this morning to discuss its options, including a possible counteroffer

The paper says many industry analysts said they did not expect Verizon's move, raising its original offer by roughly US$900 million, to end the competition, which has at times looked like a shouting match between the rival Bell companies.

Regardless of whether Verizon or Qwest ultimately wins the tug of war, MCI has obtained what it hoped for: a bidding war for a company that emerged from bankruptcy protection less than a year ago, says the NYT.

According to the NYT., Qwest's US$8.45 billion bid is still favored by some MCI shareholders, who have already filed lawsuits hoping to force MCI's board to accept the higher offer. Even without raising its offer, analysts said, Qwest may well take its case directly to MCI shareholders via a proxy vote.

But now that Verizon has raised its price so it is offering 10 percent less than Qwest instead of 20 percent, MCI's board may have an easier time justifying its decision to choose Verizon, reports the paper

The NYT says Verizon, which first agreed to buy MCI six weeks ago for US$6.75 billion, will now pay US$7.6 billion, or $23.50 a share. For each share, the offer breaks down to US$8.35 in cash, US$14.75 in stock and a 40-cent dividend MCI has already paid to its shareholders.


Stolen laptop exposes data of 100,000

A thief recently walked into a University of California, Berkeley office and swiped a computer laptop containing personal information about nearly 100,000 alumni, graduate students and past applicants, highlighting a continued lack of security that has increased society's vulnerability to identity theft.

The New York Times and Associated Press report (29 Mar.) that University officials waited until Monday to announce the 11 March crime, hoping that police would be able to catch the thief and reclaim the computer. When that didn't happen, the school publicised the theft to comply with a state law requiring consumers be notified whenever their Social Security numbers or other sensitive information have been breached.

UC Berkeley plans to advise the 98,369 people affected by the laptop theft to check their credit reports, although there has been no indication any of he personal information has been used illegally, university spokeswoman Maria Felde said, reports  the NYT.

The NYT and AP says that the UC Berkeley incident follows several other high profile instances in which businesses and schools have lost control of personal information that they kept in computer databases.

Recent breaches have occurred at: ChoicePoint, a consumer data firm duped into distributing personal information about 145,000 people; Lexis-Nexis, a data storehouse where computer hackers obtained access to the personal information of 32,000 people; and Chico State University, where a computer hacking job exposed 59,000 people to potential identity theft.

The paper and AP say that the risks of identity theft have risen in recent years as technological advances make it easier for businesses, schools and other organisations to create vast databases containing Social Security numbers, credit card account numbers and other personal information.

According to the paper and AP, all that valuable data has turned the computer storehouses into inviting targets for thieves who frequently don't have to work too hard to pull off their crimes. Computer hackers create some of the mischief by circumventing high-tech firewalls, but 58 percent of the breaches recorded by California officials have occurred after a computer or other device containing personal information is lost or stolen, McNabb said, tre paper and AP report.

The paper and AP say the security risks of these incidents could be minimised if the caretakers of the personal information encrypted the sensitive information -- a process that makes it virtually impossible to read the data without a special code.


HP sues printer-cartridge refillers

HP has sued a pair of printer cartridge refillers in a bid to protect its consumables business.

The Register reports that HP has filed a complaint with the US District Court of Northern California against RhinoTek, accusing the refiller of false advertising - it maintains RhinoTek's "packaging and promotional materials are calculated to give consumers the impression that defendants' cartridges are new".

HP's filing requests the court order RhinoTek to make it clear that the company is selling used and refilled cartridges. It also requests RhinoTek's profits from the allegedly mis-sold products be handed over as damages, The Register reports.

On Friday, the printer giant sued InkCycle for allegedly violating three of its patents. All three centre on ways of making ink dry more quickly to colours from blurring, a process that effectively reduces the resolution of the printed image. The InkCycle complaint was filed with the US District Court of Western Wisconsin. HP said InkCycle.

The Register says that both cases mark the latest stage in printer vendors' ongoing struggle against companies who take old cartridges and refill them with ink, or seek to offer alternative consumables to the vendors' own. The vendors maintain their new products are better than refilled ones.


ISPs share hacker info

Telcos, internet service providers, equipment makers, universities and hosting companies are joining forces to exchange information about attempted hack attacks. The "Fingerprint Sharing Alliance" doesn't actually share fingerprints but rather profiles of attacks.

The Register reports (29 Mar.) that Arbor Networks will collect the information automatically. For instance: a denial of service attack is launched against a customer of yours. Arbor will detect the spike in traffic, check it's not event-based, and give you information to defend against the attack.

It will also collect enough information, a fingerprint, to identify the attack and pass that information to downstream service providers hit by the attack, reoprts The Register.

There are some big names backing the network including BT, Cisco, Earthlink, Internet2, MCI, The Planet, University of Pennslyvania and Rackspace Managed Hosting, epors The Register.


Settlement in freelance writers' suit
Freelance writers have agreed to a settlement worth as much as US$18 million with publishing companies, including The New York Times Company, in a copyright infringement case involving work posted online or in databases, the writers' representatives said yesterday.

Reuters and te New York Times report (29 Mar.) that a motion for approval of the settlement was filed last week in federal court in New York, said Gerard Colby, president of the National Writers Union, one of several writers' groups that brought the lawsuit.

The paper and Reuters say the lawsuit contended that articles by thousands of freelance writers appeared in online databases without their consent. The case was supported by a 2001 Supreme Court ruling that said the principles of copyright protection also applied to online distribution.


Hoya shares hit 11-month high on LCD photomasks

Shares in Japanese glass maker Hoya Corp. jumped to an 11-month high on Wednesday after several analysts issued bullish comments about the prospects for the company's liquid crystal display photomask business.

The New York Times reports (29 Mar.) that Hoya controls more than half of the market for liquid crystal display (LCD) photomasks, glass plates used to etch circuitry onto LCD panels. Its main rivals are Kyoto-based SK-Electronics and South Korea's LG Micron.

Last week, Hoya took analysts on a tour of its photomask factory in Kumamoto, southern Japan. Nomura Securities raised its rating on Hoya to "buy" from "neutral" and other analysts have also issued bullish views about Hoya's photomask operations.

Hoya is now aggressively boosting output, encouraged by the fast-growing market for LCD TVs. It started operations at a new photomask plant in Taiwan in January and plans to bring another factory in South Korea on-line by the end of this year, reports the NYT.


New fingerprint technology

Los Alamos National Laboratory scientists in the US are using a new technique to see fingerprints on surfaces that typically make them invisible.

The New York Times reports (29 Mar) that the method uses a technology called mini-X-ray fluorescence to detect chemical elements in fingerprints without altering them, said Christopher Worley, a scientist on the project.

``The conventional methods are meant to bring out fingerprint patterns with regular light -- and they have to treat those with powder, which alters them,'' Worley said. "With this you don't have to alter it or treat it at all. We can determine the elements in a fingerprint and get a pattern at the same time."

The NYT says the technology focuses a tight beam of X-rays on surfaces with fingerprints and creates a computer picture out of those scans. The equipment costs about US$175,000.

The paper says the technology for scanning the prints is widely available. What's new is the method the lab has created to see them -- which includes computer software and ways of manipulating the machinery, Worley said.


Tiscali France sale imminent

Tiscali's sale of its French operation is expected to be done and dusted shortly, the European ISP has confirmed.

The Register reports (30 Mar.) that the company has said that it has analysed the offers received for the acquisition of the French subsidiary, Liberty Surf, and has empowered the Executive Directors for its disposal which is expected to be formalised shortly.

According to The Register, Telecom Italia is favourite to snap up the business for anywhere between €250m to €300m as Tiscali looks to flog its French operation to pay-off a €250m loan due in July.

Tiscali reported that revenues for the year were up 20 per cent from €901m in 2003 to €1.08bn in the 12 months to the end of December 2004. Revenues from its internet access business (both dial-up and broadband) accounted for 68 per cent of turnover, reported The Register.

The Register says that at the end of December 2004, Tiscali had 7.4m internet users including 5.7m dial-up users and 1.65 ADSL customers - 840,000 more broadband users than the year before.


Eidos bidder wins second major backer

UK-based games publisher SCi has won a second major backer, adding weight to its £80.4m bid for rival publisher Eidos.

The Register reports (30 Mar.) that SCi has already gained Schroder's thumbs-up. The investment house owns around 20 per cent of Eidos. Now it has Merrill Lynch's backing, the Financial Times reports, and with it ML's 4.87 per cent stake in Eidos, says The Register

According to The Register, SCi said it will offer one of its own shares for every six Eidos shares held. It launched its bid last week the day after US-based Elevation Partners, the venture capital firm which lists U2 lead singer Bono and ex-Electronic Arts president John Riccitello among its partners, said it would pay £71m in cash for loss-making Eidos.

Tuesday, 29 March 2005 17:30

News Roundup 29 Mar 2005


Yahoo challenges French fine in US appeals court

Lawyers for Yahoo returned to a federal appeals court last Thursday, pleading for legal protection for US-based internet portals whose content is protected by the First Amendment in the United States, but illegal in foreign countries.

The New York Times and Associated Press reoprt (24 Mar.) that some of the judges acknowledged the need for a shield for American companies in such situations, but suggested it was premature the case of Yahoo, which is challenging a fine levied by a Paris court four years ago for allowing the site's French users to buy and sell Nazi memorabilia, in violation of French law.

The paper says Yahoo asked the 11-judge panel of the San Francisco-based 9th US Circuit Court of Appeals on Thursday to prevent the two French human rights groups that sued from collecting the fine -- now at about US$15 million and growing by as much as US$15,000 per day.

But during 70 minutes of arguments, some judges noted that the French groups haven't tried to collect.

The NYT and AP say that Yahoo attorney Robert Vanderet said the human rights groups might try to collect, and that Yahoo isn't the only internet portal that needs to know whether US. courts would shield American companies from being liable abroad for lawfully protected speech originating in America.

According to the paper and AP., Yahoo's French subsidiary,, complies with France's law, but a French judge ordered Sunnyvale-based to strip Nazi paraphernalia from the portal's most popular site, Yahoo did not appeal the French order, and instead sought protection in US courts.

A San Jose federal judge in 2002 ruled Yahoo, as an American company, was not liable, and the human rights groups appealed. A three-judge 9th Circuit panel overturned the judge, saying he ruled prematurely, since France's Union of Jewish Students and the International Anti-Racism and Anti-Semitism League haven't acted on the French judgment. Yahoo then sought Thursday's rehearing before an 11-judge panel.

Yahoo says its international subsidiaries comply with local laws, and said it's technologically impossible to censor its US site for users in France, the paper and AP report.

The human rights groups' attorney, E. Randol Schoenberg, said Yahoo has dramatically limited the Nazi material on its American site, and that his clients won't try to collect unless Yahoo reverts "to their old ways," the NYT and AP report.

AMD to buy back stock

The Mercury News reports (24 Mar) that amid a chip-industry downturn, Applied Materials (AMD) showed off its financial strength by declaring its first quarterly dividend -- 3 cents a share -- and announcing plans to buy back up to US$4 billion of its stock over the next three years.

The world's biggest maker of equipment for producing chips said at its annual meeting that it remains financially strong in the downturn and continues to generate high margins while gaining market share, the paper reports.

Chip-industry sales growth slowed in the second half of 2004, after a huge growth spurt in the first half, says the paper, and orders for new equipment at Applied and its competitors have been dropping for a couple of quarters. Applied made no new forecast about its current second-fiscal quarter ending in late April, and when an upturn in the US$40 billion equipment industry might begin.

Applied, which has about US$2.2 billion in cash, said it is confident that paying the dividend makes sense at this time. The company's chief executive officer, said the company gained market share in the past year. Revenue grew 79 percent to US$8 billion in the fiscal year ended October 2004 from the previous year.

By comparison, rivals in the industry grew an average of 50 percent, reports The Mercury.

In the most recent quarter ended 30January, Applied's sales growth slowed to 14 percent vs. a year earlier, with revenue reaching US$1.78 billion, repoprts The Mercury, adding that customers continue to invest in multimillion-dollar chip-making tools for US$2 billion to US$3 billion factories that process 300-millimeter wafers, which are more efficient and cost-effective than older 200-millimeter wafers.

The Mercury says that Gartner reported that final results showed that the worldwide semiconductor industry grew 23 percent in 2004 to US$219.9 billion.

New web sites to store public's digital content

Tapping into a growing interest in so-called grass-roots media, two web sites in the US have just launched, aiming to become repositories and clearinghouses for a wide variety of digital content created by the public.

The Mercury News reports (24 Mar.) that Ourmedia is offering a central place for people to upload and store any digital media they want to share with the world, including video, audio, images and text files. The service is free.

The founders say the service could help content producers find new audiences for their work. And it could become a cultural archive for researchers and future generations of Internet users that want to view history through an alternative media lens, say Ourmedia's founders, reports The Mercury.

Grassroots media has enjoyed an explosion of interest in the past year, fueled by the increased credibility of bloggers and the growing popularity of video and audio tools such as camcorders and editing software, the paper says.

The Mercury says the Ourmedia group also is talking with companies such as Yahoo and Google about hosting media files on their own servers. It wants third-party developers to build their own interfaces to its content. And the group is exploring peer-to-peer technology that would allow Ourmedia to become a gateway to media files stored on individual personal computers.

The paper adds that much of Ourmedia's vision is shared by another site called NowPublic that has just launched in Vancouver. The site allows everyday people to act as editors, reporters and photographers. A user submits "assignments" requesting information about a particular topic or event, and others upload video, photos or text to complete the story.


Sony's PSP too good for just games

The Mercury News claims (24 Mar.) that Sony is sliding a Trojan horse into the hands of the world's video game fans with its new PlayStation Portable, or PSP.

Launching in the United States a few days ago, the PSP at US$249.99 delivers breathtaking realism to the once sleepy category of handheld video games, says The Mercury, adding that the images on its wide-screen 4.3-inch-diagonal color LCD are cinematic, and the sound through headphones is orchestral.

The paper says that demand for the PSP is so intense that Sony's initial shipment of 1 million units to the US market may be snapped up entirely by eager gamers who either placed pre-orders for the sleek black slab -- or showed up at stores first thing.

But, says The Mercury, the PSP, which launched in Japan in December and will reach Europe later this year, is more than an assault on rival Nintendo, which has had a virtual lock on handheld video games through its long-running GameBoy franchise and more recent Nintendo DS.

The Mercury says that right now, the 10-ounce PSP will play movies, music and slideshows of your personal pictures. In the near future, the PSP could go online wirelessly for instant messaging, e-mail, web browsing and even voice-over-the-internet (VoIP) phone calls.

The paper says game developers are flocking to the PSP, attracted both by the device itself and by the aura of success surrounding Sony in home video game consoles. Sony says 24 games for PSP will be available at launch or shortly after, with 23 more in development.

Finally, the PSP has built-in WiFi wireless networking, says The Mercury. WiFi for now is used for multiplayer gaming; up to 16 people can face off against each other in the same room. Some games also allow competition via the internet, with the PSP connecting through WiFi access points or "hot spots."

Plot thickens in Japan's hostile takeover battle

An affiliate of Softbank of Japan has emerged as the biggest shareholder in the Fuji Television Network in a move apparently intended to fend off a possible takeover of Fuji by Livedoor, the internet start-up.

The New York Times reports (24 Mar.) that the Softbank Investment Corporation acquired 14.67 percent of the voting rights in Fuji Television, Japan's largest private television network, by borrowing the shares from the Nippon Broadcasting System, a Fuji affiliate, the companies said in a statement.

The paper says that Livedoor, an internet services and portal company run by an ambitious 32-year-old entrepreneur, Takafumi Horie, had been surreptitiously building up stock in Nippon Broadcasting, Fuji's largest shareholder before the stock loan. Mr. Horie was reportedly planning to use Nippon Broadcasting's stake in Fuji as a backdoor entry to gain control of Fuji. By jettisoning its stock in Fuji, Nippon Broadcasting blocked any Horie plan to use that strategy.

Softbank Investment, a brokerage and asset management firm, is run by Yoshitaka Kitao, long considered the brain behind Softbank, Japan's top internet holding company, reports The NYT.

The paper says the Softbank group has good reason to help Fuji defend itself from a hostile takeover by Livedoor: Softbank is the largest shareholder in Yahoo Japan, one of Livedoor's top rivals. Softbank also runs the country's second-largest broadband Internet service, after NTT, and has holdings in a host of Internet businesses. Softbank owns 39 percent of Softbank Investments, the paper says.


Companies in RFID tag business broaden legal dispute

A skirmish over patents between suppliers of gear that uses radio signals instead of bar codes to identify commercial goods expanded yesterday into a much broader legal battle.

The New York Times reports (25 Mar.) that Intermec Technologies, a subsidiary of Unova, said it had filed claims that Symbol Technologies was infringing on six major Intermec patents covering technologies used in wireless communications products that Symbol sells. Intermec's complaint is a counterclaim to a lawsuit that Symbol filed this month in a federal court in Delaware, accusing Intermec of infringing on basic Symbol patents in the wireless networking field popularly known as Wi-Fi, the paper adds.

But, says the paper, most investment analysts are focusing on the dispute between the companies over their patents in radio tagging, a technology that Wal-Mart, the Defense Department and other major buyers of commercial goods are promoting as a far more efficient way than bar codes to track products in their huge supply chains.

The paper says the dispute over the scope of the patents is the first such lawsuit since the use of radio frequency identification (RFID) began to expand rapidly with the backing of Wal-Mart and major consumer products manufacturers.

According to the NYT., by some estimates there are more than 3,000 RFID patents, with some dating back to the 1940's. Intermec's claims are based in part on a core group of patents it bought from IBM.


Apple's legal drive to stifle web sites fruitless

Since Apple Computer filed a lawsuit in January against Think Secret, a Web site operated by a 19-year-old Harvard student, accusing the site of publishing Apple's trade secrets, the company has sent a series of cease-and-desist letters to the student, Nicholas M. Ciarelli.

The New York Times reports 24 mart.) that so far, the letters appear to have done nothing to reduce Mr. Ciarelli's enthusiasm. He has continued to publish articles about Apple's new product plans.

The paper says Apple's continued legal barrage has also stirred up the community of web sites and web logs that routinely speculate on the company's product plans. Several operators said that Apple's legal campaign does not appear to have slowed the flow of information about details and announcement dates of new Apple products.

On Monday, another web site, macosXrumors, removed an article describing Apple's recent distribution of a test version of its new Tiger operating system, stating that it had done so at the request of Apple's lawyers, says the paper.

The NYT says that the web site operator, Alexandros Roussos, is a college student at Université René Descartes Paris 5. He said in an online interview that much of the information published on the site, which he has published since May 2002, comes from anonymous sources.

Roussos said the dispute between Apple and web sites operators did not appear to have reduced gossip about Apple. Apple refused to comment on the letters sent to Mr. Ciarelli and Mr. Roussos, the paper reports.

Ciarelli, who still considers himself a fan of Apple, said he was a journalist and should be protected by laws that shield journalists from having to divulge the names of confidential sources.

So far this month Ciarelli has reported that Apple is planning to introduce the newest version of its operating system, known as OS X Tiger, in April and that it is also planning newer versions of its iMac and eMac computers, reports the NYT.

The paper reports that separately, Apple said that it had reached a settlement with Doug Steigerwald, a 22-year-old college student whom the company had accused of illegally distributing a test version of the Tiger operating system over the Internet. Apple still has legal action pending against two other men in the case, which was filed in December in federal court in California, the NYT says.


Europe refuses Microsoft's plan for trustee

The European Commission has said that it had rejected a set of restrictions that Microsoft wants to impose on a trustee who will be charged with policing last year's antitrust ruling against the company.

The New York Times reports (24 mar.): "Microsoft wished to have a veto on what issues the monitoring trustee could examine," said Jonathan Todd, a commission spokesman. He added that the request was "unacceptable" because it would undermine the role of the trustee, who has yet to be named.

The paper says that the trustee issue is the latest in a series of problems delaying the enforcement of two orders handed out by the commission a year ago.

Under the second order, Microsoft must sell a version of Windows that is not bundled with its Media Player music and video software, alongside the bundled version it currently sells. Last Tuesday, RealNetworks, the maker of a rival program to Media Player, said Microsoft was not ready to comply with the second order, the NYT reports.

According to the NYT.,the commission is assessing Microsoft's plans for issuing the second version of Windows and is expected to make a decision in the next two weeks.

Microsoft dismissed criticism that it was dragging its feet and said that the commission was causing the delays. Microsoft has submitted a series of proposals for how the monitoring trustee should operate, most recently on 28 January, said a Microsoft spokesman, reports the paper.

Last week, Microsoft also attributed delays in applying the antitrust ruling to the commission's slow response to its proposals, and over the last month the commission has consulted software specialists to see if Microsoft's proposals will address the competition problems they were intended to solve, says the paper.

The NYT reports that the commission can impose daily fines of around US$5 million on Microsoft if it concludes that the company is not honoring the ruling.

New company to focus on artificial intelligence

The technologist and the marketing executive who co-founded Palm Computing in 1992 are starting a new company that plans to license software technologies based on a novel theory of how the mind works.

The New York Times reports (24 Mar.) that Jeff Hawkins and Donna Dubinsky will remain involved with what is now called PalmOne, but on Thursday they plan to announce the creation of Numenta, a technology development firm that will conduct research in an effort to extend Mr. Hawkins's theories.

The paper says those ideas were initially sketched out last year in his book "On Intelligence: How a New Understanding of the Brain Will Lead to the Creation of Truly Intelligent Machines," co-written with Sandra Blakeslee, who also writes for The New York Times.

Dileep George, a Stanford University graduate student who has worked with Hawkins in translating his theory into software, is joining the firm as a co-founder, reports the paper.

Hawkins said that he believed there would soon be a new wave of software based on new theoretical understanding of the brain's operations, the paper reports. He acknowledged, however, that full-scale applications of his theoretical approach had not yet been developed or proved . Hawkins is now demonstrating a pattern-recognition application using a version of his software. It allows a computer to correctly identify a line drawing of a dog from many different patterns. Commercial uses for the technology might include speech recognition for telephone customer service or vision systems for quality control in factories, the NYT reports.

Hawkins and Dubinsky left Palm Computing in 1998 to form Handspring. They then returned to Palm in 2003 when it acquired Handspring in an effort to speed its entry into the market for smart phones. Ms. Dubinsky is currently a PalmOne board member, according to the NYT.


Motion filter eases troubles with mouse

Moving a mouse with precision is difficult for those whose hands shake because of motor impairment,says a report in the New York Times (24 mar.). However, now an IBM researcher has invented an inexpensive adapter that minimises the impact of such tremors.

The paper says that tens of millions of people worldwide experience involuntary hand movements because of conditions like Parkinson's disease and essential tremor. The adapter, which is the size of a hand-held calculator, plugs in between the mouse and the computer. A microprocessor within the device takes the motion data that normally goes to the computer and applies an algorithm that filters out all the high-frequency motion caused by the tremor, the paper reports.

The NYT further reports that the mouse filter is being offered on the web for about US$100 by a small British electronics firm, Montrose Secam.

The paper says the mouse adapter has several controls, including one that rejects the extra mouse clicks of twitchy fingers. Another control makes it easier to double-click, a motion that can be difficult for many people with motor-control problems.

About 10 million people in the United States have essential tremor, Ms. Rice said. The average age of onset of tremor is 45.

No additional software is required with the device, called an Assistive Mouse Adapter, reports the paper


New Sony CEO likely to boost outsourcing say analysts

As Sony's new chief executive settles in with a mandate to shake up the struggling electronics company, analysts expect it to increase outsourcing, benefiting large, contract manufacturers.

The New York Times and Reuters report (24 Mar.) that Sony already outsources production of some of its electronics gear, such as cell phones and its PS2 video game consoles -- but the company is still largely vertically integrated, analysts said.

The paper says one analyst at research firm IDC said Sony, which earlier this month promoted US operations chief Howard Stringer to the top corporate spot, is most likely to expand outsourcing to the large companies with which it already does business.

Fitting that bill, the analysts said, are Singapore-based Flextronics International, the world's largest contract electronics manufacturer and the maker of Sony- Ericsson phones, and Taiwan's Hon Hai Precision Industry, which makes the PS2, the paper reports.

Sony, which invented the Walkman, has been outmaneuvered in recent years in flat-panel TVs by rivals Sharp and Matsushita Electric and lost its lead in the portable music industry to Apple Computerand its market-leading iPod player, saysw the NYT and Reuters.

The paper and Reuters say Sony is more than halfway through a three-year restructuring plan in which it aims to cut fixed costs by US$3.15 billion by streamlining operations and cutting jobs, but profit margins remain razor-thin.


Yahoo sets $3 billion share buyback; shares rise

Internet media company Yahoo on Thursday said its board authorised a program to buy back up to US$3 billion of its common stock over the next five years.

The New York Times and Reuters report (24 Mar.) that Yahoo, whose shares rose nearly 4 percent, said the repurchases will be funded using working capital. The company had cash, cash equivalents and marketable securities of US$4.6 billion as of 31 December.

The paper and Reuters say that as of 4 March, Yahoo had 1.4 billion common shares outstanding. The share buyback authorisation represents about 7 percent of Yahoo's total market capitalisation US$42.82 billion.

Yahoo completed its previous stock repurchase program, which called for the purchase of up to US$500 million of stock. It bought back 38 million shares for US$325 million, including US$165 million during the first quarter of 2005, reports the paper and Reuters.

According to the NYT and Reuters, Yahoo also said it has US$175 million in structured stock repurchase transactions outstanding.


Sony PSP launches in North America

With hype and fanfare usually reserved for a movie premiere, die hard video game fans formed large lines Thursday to buy Sony 's tiny new PlayStation Portable, reports The New York Times and Associated Press (24 Mar.).

The paper and AP reported that at the Sony Style store in New York, "Last Call" host Carson Daly joined Sony executives for a midnight madness event. Hundreds lined up at Sony's Metreon store in San Francisco to pick up the hot gadget, while midnight launches or early openings were held at most of Grapevine, Texas-based retailer GameStop's 1,800 outlets.

The NYT and AP says that the PSP, Sony's first foray into portable video game machines, features stereo sound and a sharp, 4.3-inch color screen. Sony hopes the PSP can appeal to more than gamers with its ability to play movies, music and show pictures.

Sony made 1 million PSPs available for Thursday's North American launch; the company has sold more than 1.2 million in Japan since December. Sony plans to increase production to 2 million units per month by the middle of next year, report the NYT and AP.


New Sony president admits consumer misses

Sony's engineering prowess helped the company develop an array of nifty products but those gadgets often failed to appeal to consumers, the electronics maker's new president said last Thursday.

The New York Times and AP report (24 Mar.) that Ryoji Chubachi, a production expert appointed president earlier this month to lead a turnaround at the struggling manufacturer, said Sony often struck out with buyers because engineers had sometimes strayed from market trends.

In a major management reshuffle, Chubachi was appointed Sony president, overseeing the electronics business, and Howard Stringer, who has led Sony's entertainment business, was chosen chairman and chief executive. report the paper and AP.

The paper and AP say that Stringer, who holds British and US citizenship, is the first foreigner to lead Sony, a company that made its global fortune over several decades on the success of its Walkman portable music player, Trinitron TV and other popular products.

But, says the report, in recent years, Sony has been fighting competition from cheaper and more profitable Asian rivals such as Samsung Electronics of South Korea. Sony's brand image was also battered as smaller Japanese rivals such as Sharp took a lead in booming products such as liquid-crystal display TVs.

Sony needs to shift to "growth" areas such as flat TVs, DVD recorders and mobile gadgets, Chubachi said, while declining to give specifics about products, says the paper and AP.

The NYT and AP further report that Chubachi also acknowledged Sony's problems require time to fix. Another critical problem has been Sony's inability to quickly and thoroughly communicate management goals through its ranks, he said.


Satellite radio battle heats up on autos

The CD player, cruise control and heated seats are standard features on many new cars -- is the satellite radio far behind?, asks the New York Times/AP in a 24 March report.

The paper and AP report that many analysts say satellite radio is getting closer to making that happen with Hyundai Motor's deal last week to make equipment from XM Satellite Radio Holdings a standard feature in all the South Korean automaker's models. On the same day, XM's competitor Sirius Satellite Radio also announced deals to make its equipment available as an option on models from Land Rover and Jaguar, both owned by Ford, the paper and AP report.

According to the NYT and AP., the XM-Hyundai deal marks the first time a major auto manufacturer has agreed to offer satellite radio right along with automatic windows and power steering. But, more importantly, XM's relationship with Hyundai marks a turning point for a fledgling industry desperate to expand its subscriber base to match its spending habits.

Wall Street has held to the view that each satellite radio provider needs about 10 million subscribers to break even. XM said the deal with Hyundai -- which is seen having a domino effect on other auto makers -- means XM radios will be in more than 500,000 Hyundai vehicles by 2007, the paper and AP report.


Fewer using peer-to-peer systems

Use of peer-to-peer systems like Kazaa for sharing music and other files online has dropped as more Americans who use the internet turn to such alternative methods as downloading files from a friend's iPod, a new study finds.

The New York Times and Associated Press report (25 Mar.) that though the percentage of internet users who share files online has changed little over the past year, remaining at about 24 percent, fewer are using P2P systems. Twenty-one percent of current music downloaders say they still use P2P systems, compared with 31 percent in February 2004, according to the Pew Internet and American Life Project.

The paper and AP report that the study was released ahead of Tuesday's Supreme Court hearing on whether operators of such systems can be held liable for what users do with the software.Usage of paid services like iTunes has increased to 34 percent of current music downloaders, compared with 17 percent last year.

The report says that overall, about half of the current music or video downloaders say they have used sources other than P2P or paid services. E-mail and instant messages were popular, as was taking files from someone else's iPod or other MP3 player.

According to the NYT and AP., researchers warn, however, that survey respondents may be less likely to admit to using P2P systems because of the stigma associated with them. The recording industry has been aggressive at suing users, reaching settlements with many for thousands of dollars apiece.

The paper and AP says the study is based on a random, telephone-based survey of 1,421 adult internet users in the United States.


DVR a hit and growing trend

Six percent of Americans own a TiVo or other digital video recorder and another 6 percent plan to buy one in the next year, a study finds.

The New York Times/Associated Press report (24 mar.) that the overwhelming majority of DVR owners -- 81 percent -- say they "love" or "like" them, according to the joint study from Arbitron and Edison Media Research. More than half say the DVRs have had a "big impact" on their lives.

The paper and AP say that among all recorders of television shows, including VCR owners, 29 percent cite the ability to skip ads as the primary reason for recording shows, while 52 percent want to watch shows at a more convenient time.

Those who don't record shows are evenly split between who say it's too difficult or time consuming and those who cite an unwillingness to decide ahead of time what they want to watch, the report in the NYT/AP says.

According to the NYT and AP., the study also finds that a quarter of Americans have watched video on the internet and a similar number have used pay-per-view or other on-demand services offered by their cable or satellite provider.

The findings were based on interviews with 1,855 teens and adults. Participants were identified mostly through a random sample of Arbitron's diary keepers for radio audience ratings, which in turn were identified through random telephone dialing. Additional participants came from a separate random phone sample.


Dell unveils new PC servers, corporate services

Dell, the world's largest PC maker, has just introduced two low-priced server computers as it seeks to convince wary customers that networks of PC-style machines can handle tasks generally reserved for much bigger computers.

The New York Times/Reuters report (23 Mar.) that Dell, which mainly sells its PCs to businesses, has had mixed success convincing corporations to use its products to run key programs such as massive databases from Oracle and services to maintain networks of machines.

Computer makers of all levels for years have been developing low-cost machines that can be networked together and in tandem handle such major tasks, say the NYT and Reuters, also reporting that one analyst said Dell had succeeded in preparing easy setup for the machines, the PowerEdge 6800 and 6850, which each can have up to four Intel chips.

The report says that Dell also introduced a new version of its OpenManage system management software to control networks of computers, such as upgrading software across many machines and monitoring performance. Major competitors include IBM or Hewlett-Packard, and Sun Microsystems.

The PowerEdge 6850 server, priced at US$4,899, is designed to run major Oracle database installations. The 6800, priced at US$3,999, is for customers aiming to lower costs by consolidating multiple machines onto a single server,the paper and Reuters report.


Internet phones likely to see price competition

The booming market for phone calls using internet technology has created a bonanza for telecom gear makers such as Cisco Systems, but aggressive pricing could squeeze profits.

The New York Times and Reuters report (23 Mar.) that price competition for so-called corporate VOIP products, particularly among the three big North American players -- Cisco, Avaya and Nortel Networks -- may be intensifying, prompted by lackluster information technology spending and moves to capitalize on a replacement cycle for phone systems, analysts said.

The paper and Reuters say that concerns about aggressive price discounting by Avaya, among the largest makers of VOIP, or voice over Internet protocol, equipment, has weighed on the company's stock.

Representatives for Avaya and Cisco declined to discuss their pricing strategies. Nortel, which has been besieged by accounting problems, was more forthright - "we find that pricing pressures on VOIP are a reality; it's a factor of competitive markets," a Nortel spokeswoman said.

The NYT and Reuters report that the market for VOIP equipment sold to corporations and other enterprises, including phones, hardware and software, grew 78 percent to US$3.07 billion in 2004, according to research firm Synergy's data, and is seen rising to US$4.42 billion this year.

The report also says that price is especially important as companies install VOIP systems in hopes of saving money in the long-run on their phone bills. Synergy estimates it costs about US$100,000 for a mid-sized US company with 200 work stations to replace its traditional switchboard phone system with VOIP equipment. Beyond costs, customers demand intelligent VOIP features such as sophisticated call tracking and inventory management.

Besides the North American players, the global VOIP market includes names like Alcatel, Siemens and Mitel, as well as a host of smaller companies such as 3Com and SpectraLink.

The paper and Reuters say that as the technology of making IP phones becomes simpler and more Asian rivals enter the fray -- at least a few years away -- prices for the phones themselves, which average around US$250 for a unit, will become even more aggressive, analysts forecast.


Two offers for phone unit of Italian utility

Two groups of investors made offers on Friday for control of Wind, the telecommunications arm of Enel, Italy's biggest utility.

The New  York Times reports (26 Mar.) that Italian officials have valued the entire business at 13 billion euros (US$16.8 billion), setting the stage for one of Europe's largest leveraged buyouts.

Last Friday, a consortium of private equity investors led by the Blackstone Group, based in New York, made an offer worth about 11.5 billion euros (US$15 billion), according to an executive close to the bidding. The others in the group are two buyout firms - Permira and Providence Equity Partners - and Goldman Sachs.

The paper reports that several hours later, a group led by Naguib Sawiris, an Egyptian telecommunications executive, submitted a counteroffer, said another executive, who declined to disclose any details.

Mr. Sawiris is the head of Orascom Telecom Holdings, which has operations across nine countries in the Middle East and Africa. He has joined the American financier Wilbur L. Ross and the French investor Philippe Nguyen to make a bid, reports the NYT.

Wind is Italy's third-largest mobile phone carrier behind Telecom Italia and the Italian operations of Vodafone. It is also the country's second-largest fixed-line operator behind Telecom Italia. It has a total of 28 million customers, including internet users. Wind reported 4.4 billion euros (US$5.7 billion) in revenue in 2003, the latest yearly data available, reports the NYT.


Europe's plan to deregulate travel booking slammed

Buying a plane ticket in France, Germany or Spain could become more expensive if the European Commission scraps regulations on electronic reservations systems, rival companies and European consumer groups are saying.

The New York Times reports (26 Mar.) that the European Commission will deregulate the computer reservations systems for air travel later this year. At present, the airlines are required to share their ticket availability and prices with all computer reservation systems. Dissenters, however, fear that ending that rule could give Amadeus, already Europe's biggest computer reservation system, even greater power.

The paper says that opponents of full deregulation of the European market include two American computer reservation companies, Galileo, a unit of Cendant, and Sabre; British Airways; the German travel company TUI; and the Europe-wide consumer group, Bureau Européen des Unions de Consommateurs, B.E.U.C.

According to the NYT., Air France, Lufthansa and Iberia control Amadeus, which dominates their home markets. Galileo and Sabre say that Amadeus commands more than 90 percent of all bookings over computer reservation systems in Spain. In Germany and France, Amadeus has 79 percent and 73 percent of the market respectively, the two competitors said. Any weakening of the current system would push up ticket prices and reduce flight choices for French, Spanish and German travelers, Galileo and Sabre contend.

The paper says that computer reservation systems were set up by airlines in the 1980's and run large databases that connect travel agents to airlines, hotel operators and auto rental companies.  While travelers are increasingly going directly to the web site of their preferred airline, most bookings are still made through one of four competing computer reservation systems: Amadeus, Galileo, Sabre and Worldspan, with the latter three being American.

And, reports the NYT., the European Commission is waiting to see the details of the Amadeus deal, and wants to know whether the airlines still maintain control of Amadeus or not.


Bid for software vendor

The Acxiom Corporation, a maker of database-management software, has offered to purchase Digital Impact, a software vendor that is already the target of an unsolicited bid by a rival, InfoUSA.

The New York Times and Bloombergs report (26 mar.) that Acxiom offered US$3.50 a share in cash, Digital Impact said in a filing with the Securities and Exchange Commission.

The papder says the offer from Acxiom will total US$129 million if it acquires all of Digital Impact's 36.9 million outstanding shares.

The paper says that the offer is US$1.21 a share more than Digital Impact's price of US$2.29 at the close of trading Thursday. Digital Impact asked shareholders this month to reject a US$69.6 million offer from InfoUSA, a data-processing and marketing services seller.


SEC sues 3 former IGo executives

The New York Times carries a Dow Jones/AP report (26 Mar.) that the Securities and Exchange Commission in the US has said that it had sued three former executives of a company once known as the IGo Corporation on charges of inflating revenue in 1999 and 2000.

The papers and Dow Jones say that IGo sold accessories for laptops and cellphones. It was acquired by Mobility Electronics in September 2002.

The company's founder and former chief executive, and the former chief financial officer, were charged Thursday with lying to auditors, prematurely recognising revenue and booking revenue without shipping products. The former vice president for sales was also charged. knows, predicts shopping habits has one potentially big advantage over its rival online retailers: It knows things about you that you may not know yourself, reports the New York Times.

The NYT says that though plenty of companies have detailed systems for tracking customer habits, critics and boosters alike say Amazon is the trailblazer, having collected information longer and used it more proactively. It even received a patent recently on technology aimed at tracking information about the people for whom its customers buy gifts.

The paper says Amazon sees such data-gathering as the best way to keep customers happy and loyal, a relationship-building technique that analysts consider potentially crucial to besting other online competitors.

However, according to the NYT.,some privacy advocates believe Amazon is getting dangerously close to becoming Big Brother with your credit card number.

"They are constantly finding new ways to exploit personal information,"said Chris Hoofnagle of the Electronic Privacy Information Center, an Amazon nemesis since 2000 after the company changed its privacy policy to allow sharing of personal information with companies it buys or partners with, the NYT reports.

The paper says for years, Amazon has collected detailed information about what its customers buy, considered buying, browsed for but never bought, recommended to others or even wished someone would buy them.

The NYT says Amazon has built ever-more sophisticated tools to recommend more purchases, direct your searches toward products it thinks you're most likely to want, or even stop the forgetful among us from buying the same book we purchased five years ago.

According to the NYT., more recently, the Seattle-based virtual retailer has launched a web search engine, called A9, that can remember everything you've ever searched for -- and the site reserves the right to share that information with its retailing arm.


Intel chooses China for chip test plant

Intel is to build a second chip assembly and testing facility in Chengdu, China, the company has just announced.

The Register reports that work on the plant, located in Sichuan Province, will begin later this year with a view to entering production in 2007. Intel's first Chengdu plant, which is currently under construction, is expected to go on stream in the second half of this year.

The first factory cost US$375m. It's not clear how much its sibling will cost, but Intel and the local governments of Chengdu and of Sichuan Province said they will raise up to US$450m, says The Register, adding that both factories will each employ 600 people.

The plants join Intel's roster of assembly and testing facilities in Shanghai, Malaysia, the Philippines and Costa Rica.

The Register reports that separately, TSMC, the world's largest chip foundry, will open a design centre at the company's Shanghai fab, executives at the plant have claimed, according to a Taiwan Economic News report.

The paper said some 40 engineering staff will be employed at the new facility, which will provide circuit design and layout services to TSMC customers, The Register adds.


No bonus for Google founders

Billionaire Google execs Larry Page and Sergey Brin are not getting bonuses from the search engine they founded together. Also off the bonus list is chief executive, and fellow billionaire, Eric Schmidt.

The Register reports (26 Mar.) that the three did get a holiday bonus of US$1,566 (£837) along with their salaries.

Google's initial public offering earned Brin and Page US$7.2bn each. Schmidt is worth US$2.8bn, according to Forbes magazine's Rich list, reports The Register.

The Registyer says that Brin and Page are paid US$150,000 a year and Schmidt gets US$250,000, according to a filing with the Securities and Exchange and Commission.

Four execs did get bonuses of between US$600,000 and $700,000, according to the filing, reports The Register.

Thursday, 24 March 2005 18:00

News Roundup 24 Mar 2005


Oracle profit drops 15% after acquisition

Oracle, the world's second-largest software company, has just reported that its revenue rose 18 percent in the third quarter but that its profit declined as it followed through on its US$10.3 billion takeover of PeopleSoft.

The New York Times reports (23 Mar.) that Safra Catz, a co-president of Oracle who is also serving as the company's chief financial officer, said the company was pleased with the quarter, which she described as a transitional one. "We are beyond satisfied," Ms. Catz said of the PeopleSoft merger, in a conference call with reporters. "We are thrilled with how it is going."

The paper says Oracle, which makes database software and applications for large companies, reported net income of US$540 million, or 10 cents a share, for the third quarter ended 28 February. That compares with profit of US$635 million, or 12 cents a share, in the third quarter last year, a decline of 15 percent.

The NYT says that Oracle's revenue for the third quarter was US$2.95 billion, an 18 percent increase from US$2.51 billion in the same quarter last year, aided by its purchase of PeopleSoft during the quarter.

Excluding certain expenses, including US$249 million in charges related to the PeopleSoft takeover, Oracle reported a profit of US$814 million, or 16 cents a share. On that basis, the company beat analysts' average forecast of 15 cents a share, the NYT adds.

The paper says that Oracle's revenue from new software license fees was US$947 million in the quarter, up from US$847 million a year ago, with most of the growth coming from the company's database business. The company said it was taking market share away from IBM in the database market.

But, the NYT says the improvement in the company's applications business was less clear. The company reported US$152 million in application license revenue during the quarter, with US$31 million coming from PeopleSoft and US$121 million from Oracle. On the basis of Oracle alone, that represents a 12 percent decline from last year, says the paper.

According to the paper's report, Ms. Catz insisted that the integration of the two companies was going smoothly, and that PeopleSoft's existing customers were happy with the merger. She added that the outlook for the fourth quarter had improved, leading Oracle to raise its full-year forecast to 64 cents to 65 cents a share, from a previous forecast of 62 cents a share.

The NYT says that Oracle's results came less than a day after it won a bidding war with SAP of Germany, its larger rival, to acquire Retek for US$341 million. Retek, which had sales last year of US$174.2 million, makes software that helps retail chains manage their operations. Roughly 80 percent of its customers also use Oracle database software, adds the paper.

Retek's board of directors accepted Oracle's most recent offer of US$11.25 a share, or US$631 million, late Monday, three weeks after SAP set off the bidding with an initial offer of US$8.50 a share, reports the NYT., adding that before Oracle made its counteroffer, Retek's board of directors accepted SAP's US$11-a-share bid and agreed to a US$25 million termination fee, which Oracle must now pay. For Oracle, the acquisition of Retek gives it a foothold in the retail market, which is going through major technological change.


Microsoft unready to carry out European order say rivals

Microsoft is failing to comply with a European Commission order to sell an unbundled version of its Windows operating system, competitors that were asked to examine the program said on Tuesday.

The New York Times reports (23 Mar.) that a  year ago, Mario Monti, then the European commissioner for competition, ordered Microsoft to sell a second version of Windows in Europe that has its music and video-playing program, Media Player, stripped out.

The paper says the order was intended to restore competition. The second version, installed with a rival alternative to Media Player, is supposed to be introduced in the next few weeks.

However, according to the NYT.,David R. Stewart, deputy general counsel for RealNetworks, said Tuesday that Microsoft was still not ready to comply with the European ruling. RealNetworks, of Seattle, which makes rival software, has the most to gain from enforcement of the order.

The paper says the commission has yet to decide whether Microsoft's proposal for introducing the unbundled version of Windows meets its requirements. Mr. Stewart contended that "the version of Windows Microsoft is proposing to sell has technical problems that render it less functional than the existing version of Windows," reports the NYT.

RealNetworks said that Microsoft had deleted registry entries associated with media-playing functions in Windows. Without the registry entries, Mr. Stewart said, rival media players installed in the second version of Windows could not work with other applications like Word documents and some Web sites, the paper reports.

A spokesman for Microsoft said the company was aware of the commission's concern about its plan to delete the registry entries. He acknowledged the problem, but said it was a direct result of having to comply with the commission's order, says the NYT.

The NYT says that last week, in a sign of growing impatience, the commission, the administrative arm of the European Union, said it had "strong doubts" that Microsoft was complying with a separate order in last year's ruling to disclose information about Windows that would allow rival producers of server software to make programs that work with the Windows operating system.


Appeal in Apple trade secrets suit

Online journalists who published secrets about Apple Computer filed an appeal Tuesday in a case that could have broad implications for the media.

The New York Times/AP report that a California judge ruled on 11 March that three independent online reporters may have to provide the identities of their confidential sources and that they weren't protected by "shield laws" that usually protect journalists.

The paper and AP say that in December, Apple sued 25 unnamed individuals, called ``Does'' and believed to be Apple employees, who leaked specifications about a product code-named "Asteroid" to Monish Bhatia, Jason O'Grady and another person who writes under the pseudonym Kasper Jade. Their articles appeared in the online publications Apple Insider and PowerPage.

The company said the leaks and the published documents violated nondisclosure agreements and California's Uniform Trade Secrets Act. Company attorneys demanded that the reporters identify their sources, says the NYT and AP.

The report says that the reporters sought a protective order against the subpoenas, saying that identifying sources would create a "chilling effect" that could erode the media's ability to report in the public's interest.

But a Santa Clara County Superior Court Judge ruled in Apple's favour earlier this month, saying that reporters who published "stolen property" weren't entitled to protections, says the report.

On Tuesday, attorneys representing the journalists filed an appeal, as expected.


EDS signs UK defence contract

EDS has signed the contract to overhaul technology for the UK's Ministry of Defence, after being named as preferred bidder earlier this month.

The Register reports (23 Mar.) that the contract is for Increment 1 of the DII(F) project which will run for ten years at a cost of £2.3bn (US$4bn). More work is possible once the first increment is completed.

The Register says EDS will lead the ATLAS consortium, which also includes Fujitsu Services, General Dynamics, EADS Defence and Security Systems and LogicaCMG.

The DII(F) project aims to bring various different networks onto one infrastructure, says The Register, and adds that the network "will provide seamless interaction between headquarters, battlefield support and the front line", according to a company press release. It will link about 340,000 users in 2,000 locations using 150,000 desktop machines, the company claimed, reported The Register.

The Register says the project will also help the MoD achieve efficiencies demanded by the Defence Change Programme.

EDS has had little luck with military contracts recently, according to The Register, adding that a deal to sort out an intranet for the US Navy was valued at US$8bn but has already cost EDS US$500m in written off assets.


Mobile phone plan for London tube

Commuters on London's Tube network could be able to use mobile phones and wireless internet connections deep underground from 2008 if trials for the technology get the green light.

The Register reports that London's Mayor Ken Livingstone is looking for suppliers to install their kit to enable commuters to use mobiles and wireless laptops on stations. The scheme could even be extended to include trains as well as underground stations.

If all goes to plan, says The Register, London Underground would trial the technology next year before a full commercial roll-out in 2008.

The railways say they also want to see how the technology could be taken even further, for instance wireless internet so passengers could receive up-to-the-minute travel information via their laptop or mobile phone.

According to The Register, tube bosses say there is strong support among passengers for mobile access across its network and that there are plenty of technology companies interested in providing services.


Newspaper giants buy web news monitor

Three of America's biggest newspaper publishers, the Gannett Company, Knight-Ridder and the Tribune Company, are joining forces to buy three-fourths of, a web site that monitors more than 10,000 online news sources.

The New York Times reports (23 Mar.) that each publisher will own 25 percent of the company., based in California, will retain the rest and continue to run the site. The cost of the acquisition, which is scheduled to be announced immediately, was not disclosed.

The paper says that is a news aggregator, continuously monitoring updates on thousands of news media web sites as well as government sites and organising links to articles in more than 300,000 subject areas. already keeps track of news from sites operated by Gannett, Knight-Ridder and Tribune, but the acquisition will allow it to approach the newspapers' online advertisers about using its technology for customising ads. It will also let add material like television listings.

Rich Skrenta, chief executive and a co-founder of, said that in exchange, the newspapers' web sites would get more fine-tuned technology and a better way to show their readers "the ads that they actually want to see," says the paper.

"They get powerful contextual advertising technology, and we make their ads more profitable," Mr. Skrenta said, referring to what he said was's ability to place relevant ads next to articles. He also said the newspaper companies, which collectively operate more than 140 newspaper web sites with nearly 30 million unique visitors a month, would direct more readers to, the paper further reports.

The NYT says the three news publishers have joined together for two other online projects, and, and they have joint ventures with other companies in web sites like and

According to the paper, the deal is the latest in a series of recent acquisitions of web ventures by newspaper companies that are, in one way or another, attempting to broaden their reach and profit from strong growth in online advertising. They include the purchase of MarketWatch by Dow Jones & Company, the purchase of by The New York Times Company and the acquisition of the online magazine Slate by The Washington Post Company, says the paper.

Tim Landon, president of the Tribune Company's interactive and classifieds unit, said in a statement that the investment in would allow the three newspaper companies to "further extend both our news and classified businesses" and "make both our local and national web sites more valuable to customers," the NYT reports.

The NYT also reports that Chris Tolles, vice president of marketing for, said the web site was able to offer highly localised news to readers across the country by providing information not only from local newspapers but also from government web sites, local television, police blotters, trade magazines and other sources.


Brit. video game maker to acquire for $US144.5m

The SCi Entertainment Group, a British video game maker, has just made a surprise £76.1 million (US$144.5 million) bid on Tuesday for a rival company, Eidos, a move that could ignite a takeover battle for Eidos.

The New York Times reports (23 Mar.) that SCi's offer came about 13 hours after Elevation Partners, a private equity firm that counts the singer Bono among its managers, said it would pay £74 million (US$139 million) for Eidos.

The paper says Eidos is best known for developing Tomb Raider, featuring the heroine Lara Croft, who has become a pop culture icon. Its other games include Hitman: Contracts and ShellShock: Nam '67. Despite Tomb Raider's renown, overall sales have been weak, and Eidos said in June that it would look for strategic alternatives including a buyer for the company.

SCi, which makes driving games like Carmageddon and a Persian Gulf war game called Conflict, is offering one share of its stock for every six shares of Eidos, or 53.6 pence a share as of March 21. Elevation Partners' offer is worth 50 pence a share in cash., the paper reports.

The NYT says that SCi submitted a detailed takeover proposal to Eidos shareholders outlining changes it could make if it won the bid, including cutting £14 million in annual costs. Eidos's brands, studios and work force have "significant potential," SCi's chief executive, Jane Cavanagh, said in a statement, but financial problems have led to rushed development and poor products.

According to the paper, SCi said it had indications that the offer would be accepted by investors holding 28 million shares, or about 20 percent of Eidos's outstanding shares. SCi is selling £60 million in stock to pay for the bid.


Macintosh hacker attacks increasing - Symantec

Hacker attacks on Apple Computer's Macintosh OS X operating system, thought by many who use the Mac to be virtually immune to attack, are on the rise, according to a report from anti-virus software vendor Symantec.

Reuters and the New York Times report (23 Mar.) that Symantec's report said that "Contrary to popular belief, the Macintosh operating system has not always been a safe haven from malicious code,".

The paper reports that Symantec said "it is now clear that the Mac OS is increasingly becoming a target for the malicious activity that is more commonly associated with Microsoft and various Unix-based operating systems."

The NYT says that many in the Macintosh computer community have long claimed that the Mac platform has been virtually immune to attack -- unlike Microsoft's Windows operating system, which runs on more than 90 percent of the world's personal computers.

The paper adds that the Macintosh operating system, the current version of which is based on the Unix operating system, has less than 5 percent of the global market for computer operating systems.

Apple's recent introduction of the Mac mini, a US$500 computer sold without a display, keyboard or mouse, could actually increase the likelihood of more malicious software computer code targeting the Mac platform, Symantec said, reports the NYT.

"The market penetration of Macintosh platforms will be accelerated by the much lower priced Mac mini, which may be purchased by less security-savvy users," the report said. "As a result, the number of vulnerabilities can be expected to increase, as will malicious activity that targets the," reportsa the NYT.

Symantec said that over the past year, it had documented 37 high-vulnerabilities -- weaknesses that leave the system open to malicious software attacks -- in Mac OS X. They "have been confirmed by the vendor, which, in the Apple case, almost always means that the company has released a patch."

At the same time, asccording to the NYT.,the report said that while those vulnerabilities in the Mac operating system will increase, "they will likely be outnumbered in other operating systems for some time to come."


World chip glut 'over early Q2'

In the UK, The Register reports that market watcher iSuppli has signalled the end of the inventory correction phenomenon that plagued the semiconductor industry through the latter half of 2004 and beyond.

According to The Register report (23 Mar.) the company has said that the electronics supply chain is on its way to ridding itself of surplus chips by the end of Q2. By the end of this month, it expects industry-wide chip inventories to have fallen to US$780m, from around US$1bn at the end of Q4 2004, iSuppli said. The publication also reports that the US$780m figure is an estimate derived from the company's mid-quarter figures, according to iSuppli.

The publication says the Q1 2005's total is less than half the US$1.62bn worth of unused chips held in the supply chain in Q3 2004, which was not only above industry observers' estimates and more than double Q2 2004's US$800m total, but was the highest the figure has risen since Q2 2002's US$2.5bn inventory.

iSuppli said it expects semiconductor suppliers to have four days' worth of chip inventory at the end of Q1, down from more than a week's worth at the start of Q4 2004, and five days at the beginning of the first quarter, The Register reports.

iSuppli put the latest reduction down to chip makers' moves to reduce the number of new chips going into production lines during Q4. The biggest stockpiles are held by chip manufacturers who upped production on the back of the high demand experienced in the first half of 2004. But with end-user demand down, vendors reduced their own orders in H2 2004 in a bid to use up the components they had already ordered, says The Register.

However, iSuppli said Far Eastern mobile phone stocks remain high, with the traditional post-Chinese New Year sales hike occurring much more slowly this year, the Register reports.


Yahoo expands e-mail storage, again

Yahoo is quadrupling the amount of storage provided with its free e-mail accounts and upgrading its desktop search software in its ongoing duel with rivals Google and Microsoft.

The New York Times and Associated Press report (234 Mar.) that Yahoo has said that it will provide 1 gigabyte of storage for each free e-mail account. The current limit is 250 megabytes. The expanded storage will be available in mid-April, according to Yahoo.

The company also is expanding the reach of its desktop software, a test product designed to find material stored on computer hard drives. Yahoo's software, licensed from X1 Technologies, will now index content from e-mail address books and discussions in Yahoo's instant messaging service, report AP and the NYT.

According to the NYT and AP.,the expanded e-mail storage enables Yahoo to catch up with online search engine leader Google, which offers an invitation-only service that has been offering 1 gigabyte of storage for nearly a year.

The paper and AP say that when Google introduced "Gmail," Yahoo provided just 4 megabytes of free e-mail storage. Yahoo, which runs the world's most popular web site, has gradually increased its e-mail capacity in response to Google's competitive threat. Microsoft's Hotmail service offers 250 megabytes of free e-mail storage.

As part of its e-mail changes, Yahoo also is providing software from Symantec to clean viruses detected in attachments, says the report.

The NYT and AP say that Yahoo's desktop software is also competing an array of similar products, including offerings from Google and Microsoft.


Sydney court hears Kazaa trial closing arguments

The owners of global file-sharing company Kazaa have told a Sydney court they should not be held liable for copyright infringements by network users because the company cannot control how the software is used after it is downloaded.

The New York Times and AP repoprt that a group of Australian record labels is suing the makers of Kazaa, Sharman Networks, and the company's directors in the Federal Court in Sydney for copyright infringements by the network's estimated 100 million members worldwide.

The paper and AP say the record companies claim Kazaa users freely download up to 3 billion songs and music files each month, costing the industry millions of dollars in unpaid royalties.

In closing arguments, lawyers for Sharman Networks acknowledged that some Kazaa users engage in illegal copying, but said the software's creators could not be held responsible, the report says.

The court was told that once Kazaa was downloaded onto users' computers, the company had "no power to control" its use -- just as the makers of photocopiers and video recorders could not control or be held responsible for illegal copying on their machines, report te NYT and AP.

As a result, the lawyer said, the main issue in the case was whether Kazaa, in effect, authorised its users to download copyright protected material.

Lawyers for the record industry argue that Kazaa not only enables but encourages users to infringe copyright, report the NYT and AP., adding that
the lawyers also said the company collects information about its users that would enable them to control their use of the software.

The trial, which is being heard before a judge with no jury, wasexpected to wrap up late yesterday, with averdict expected within six weeks, report the paper and AP.


IBM pays off Compuware

After five weeks in court IBM has agreed to settle all ongoing legal disputes with Compuware. Big Blue is paying the mainframe management software vendor US$140m for software licenses and US$260m for services over the next four years, reports The Register (23 Mar.).

The register says the two companies agreed to end all outstanding litigation and to share interoperability information. They also signed a reciprocal patent license agreement covering both companies' technology.

Compuware had accused IBM of using information from ex-Compuware employees in breach of their confidentiality agreements, reports The Register, adding that IBM was also accused of using trade secrets to improve its own mainframe management software.

IBM was also accused of unfairly linking hardware and software sales to try and "kill" Compuware, says The Register.


Level 3 pulls US internet phone fees request

In the US, a company that provides Internet phone service has withdrawn a request to federal regulators asking that it be exempt from paying higher fees to local phone companies for transmitting certain calls over the traditional phone network.

The New York Times and AP rerport (22 Mar.) that Level 3 Communications told the Federal Communications Commission that the cost of making internet calls could rise if the FCC ruled that the company had to pay higher access charges to local phone companies.

Level 3 doesn't deal directly with consumers, but provides Voice over Internet Protocol, or VoIP, services to internet providers, says the papdsr and AP., adding that cable companies and other firms that then sell to consumers. Higher costs would eventually be absorbed by subscribers, industry officials say.

Tuesday was the deadline for an FCC decision, but Broomfield, Colo.-based Level 3 withdrew the request Monday night. Industry officials said the FCC had been preparing to rule against Level 3, says the paper and AP.

Many companies like Level 3 do pay to use the phone network, but local phone companies say it's not enough. They contend internet phone providers should pay the more costly access charges that long distance companies pay, says the report.

VoIP technology shifts calls away from wires and switches, instead using computers and broadband connections to convert sounds into data and transmit them via the internet. In many cases, subscribers use conventional phones connected to a special box and a high-speed connection to make Internet calls, says ghe report.

The NYT and AP say Level 3's request dealt specifically with calls that started from an internet phone but ended on a traditional line, or vice versa.


AOL LatAm out of cash, may stop operating

America Online Latin America, the beleaguered provider of internet services in South America, has just said that it is running out of cash and may shut down or file for bankruptcy protection.

Reuters and the New York Times report (22 Mar.) that unless AOL Latin America finds a buyer for its assets, it will have to close down operations, the Fort Lauderdale, Florida-based company said in a regulatory filing with the US Securities and Exchange Commission.

AOL Latin America, founded as a joint venture between America Online and the Cisneros Group at the start of the internet bubble in 1998, has since struggled to become profitable, say Rewuters and the NHT.

The NYT and Reuters report that the loss-making company, which provides internet dial-up service mainly in Brazil, Mexico and Argentina, stopped counting non-paying subscribers in 2003 as the SEC investigated the company's methods in counting subscribers.

The paper and Reuters add that although AOL Latin America has enough cash to stay in business through the third quarter of this year, it said it may have fallen into default with Time Warner, which holds US$160 million of senior convertible notes in the company.

AOL Latin America said it is no longer pursuing any financing, the report says.

The report adds that other internet service providers have also struggled to stay in business in Latin America. StarMedia Network, Terra Lycos and Yahoo's efforts to build an access provider have fallen flat.

The NYT and Reuters report that AOL Latin America went public on the Nasdaq in 2000 at the low end of the expected range, with investors expressing concern over its growth prospects.


Woman cleared in mass obscene e-mailings
A death penalty opponent who sent e-mails laced with obscenities and references to Adolf Hitler and Osama bin Laden to a pro-death-penalty web site was not guilty of a crime, a judge in the United States has ruled.

The New York Times and AP report that police charged Rachel L. Riffee with misdemeanor electronic harassment after they traced to her two e-mails and three web site postings sent to a pro-death penalty site run by Frederick A. Romano, the brother of a murder victim.

The paper and AP say that on Monday, a Circuit Judge acquitted Riffee, 34, ruling that state law protects political speech. The judge said the Web site invited discussion, and a few e-mails do not constitute a pattern of harassment.

Wednesday, 30 March 2005 17:30

News Roundup 30 Mar 2005


Google acquires Urchin Software

Google, the internet search company, has just announced that it has agreed to acquire the Urchin Software Corporation, which makes software to help companies analyse the traffic at their Web sites.

The New York Times and Associated Press report (29 Mar.) that thousands of internet sites use products from Urchin to help better understand their users' experiences and track the performance of advertisements and other aspects of visits to Web sites.

Google said it expected the service to help web sites increase their advertising returns, says the NYT.

The paper says that Google said it anticipated the deal would close by the end of April.

Oracle snaps up security firm

Database behemoth Oracle continued its shopping when it bought Oblix, a privately-owned security firm, for an undisclosed amount, reports The Register (29 Mar.)

The Register says Oblix provides companies with secure identity and Single Sign-On services. These are increasingly used by businesses to guarantee the identity of people accessing corporate networks over the web.

The online publication says Oblix products COREid, COREsv and SHAREid will continue to be available as individual products. But Oracle is keen to include the best features into its own identity management products.

Capital firms to buy SunGard Data

SunGard Data Systems, whose software handles most Nasdaq Stock Market trades, has agreed to be acquired by seven buyout firms led by Silver Lake Partners for US$10.4 billion in cash in the largest private takeover since 1989.

The New York Times reports (29 Mar.) that the group will pay US$36 a share for SunGard, a 44 percent premium to its price on 21March, when the company said it was approached. Joining the bid are Goldman Sachs Capital Partners, Blackstone Group, Bain Capital, Kohlberg Kravis Roberts & Company, Providence Equity Partners and Texas Pacific Group, the companies said in a statement.

The paper reports that it will be the largest takeover by US buyout firms since Kohlberg Kravis paid US$31 billion for RJR Nabisco 16 years ago. Managers of takeover funds, which spent a record US$180 billion on purchases last year, are now collaborating on purchases and avoiding competition with each other.
ne has the firepower to take a deal down of this size by themselves."

The total value of the acquisition, including debt and other items, is US$11.3 billion, SunGard said. The payment will come from equity from each of the buyout firms and debt financing from JPMorgan Chase & Company, Citigroup, Deutsche Bank, Goldman Sachs Group and Morgan Stanley, the paper adds.

The NYT says financial services companies in the United States are spending about US$100 billion a year on information technology like software that tracks trading and provides disaster recovery, which are SunGard's specialties.

Microsoft-EU agree on Windows name

Microsoft has just announced the company has reached an agreement with European Union antitrust regulators on the name Windows XP Home Edition N, with the N standing for "not with Media Player," for a reduced version of its Windows media software sold in Europe.

The New York Times and Associated Press report (29 Mar.) that the XP Professional Edition will also include the N for versions sold without the Media Player feature.

Microsoft's officials said they "have some misgivings" about the new name, fearing it may cause confusion for consumers buying the product, but say it will adopt the commission's name in order to move forward and accelerate the pace of the implementation process,the NYT and AP report.

The NYT says the agreement is part of talks between the European Union and Microsoft over the union's fine against Microsoft last year, totaling 497 million euros (US$644 million), which was imposed after the union ruled the company abusively wielded its Windows software monopoly to lock competitors out of the market.

The European Union ordered Microsoft to offer a version without Media Player and compatible with competitors' software, like RealPlayer, the audio-video player from RealNetworks, says the paper.

Qwest demands answer from MCI by 5 April

The two-month fight in the US for MCI may be coming to an end, reports The New York Times and Associated Press (29 Mar.).

The paper and AP say that Qwest Communications has just set an April 5 deadline for MCI to accept or reject its US$8.45 billion bid for the company.

Qwest, said in a letter to the MCI board that, "if we have not executed an agreement on or before midnight, April 5, 2005, our offer will be withdrawn," reports the paper.

The NYT says Qwest also said that its lenders would commit an additional US$500 million - on top of US$5.25 billion - to pay for potential merger-related expenses, like retiring MCI bonds.

The paper says Qwest's deadline is the latest twist in a fight for MCI, which agreed in February to be sold to Verizon Communications for US$6.75 billion. Qwest made an initial offer of US$8 billion, which it raised to US$8.45 billion on 17 March. Some of MCI's shareholders have pressured the company to reconsider Qwest's offer, which is now 25 percent higher than the Verizon bid.

Now, can you find its square root?

An eye surgeon in Germany has discovered the world's largest known prime number - or at least his computer did.

The New York Times reports (29 Mar.) that the surgeon, Dr. Martin Nowak of Michelfeld, is among thousands of participants in the Great Internet Mersenne Prime Search, one of several big projects that tap idle computers worldwide.

Last month, says the NYT.,Dr. Nowak's Pentium 4 computer concluded that a number it had been crunching on for more than 50 days was indeed prime, with only two integer divisors, 1 and itself.

A different computer using different software verified the result.

The paper says the number, rendered in exponential shorthand, is 225,964,951-1. It has 7,816,230 digits, and if printed in its entirety, would fill 235 pages of the New York Times.

In addition,says the NYT.,it falls in a rare category of primes known as Mersenne primes, which can be written as 2n-1 where n is also prime. The first few Mersenne primes are easily verifiable - inserting 2, 3 and 5 for n produces 3, 7 and 31, all prime - but the math quickly becomes overwhelming for larger values, says the paper.

The NYT says that in 1644, Marin Mersenne, a French monk, published a list of 11 prime numbers - the highest being 257 - for which he asserted that 2n-1 was also prime. That list was not fully checked until 1947, three centuries later. Mersenne turned out to be wrong about two numbers on his list and had missed three others, but his name still remains attached to the concept. Even with computers to speed up the search, Dr. Nowak's number is still only the 42nd Mersenne prime to be found.

The NYT says that the announcement did not, however, cause much of a stir because what mathematicians really want to know is: Are there an infinite number of such numbers?

The search nevertheless goes on, says the paper, on about 75,000 computers. Begun in 1996 by George Woltman, a computer scientist, the project has discovered eight Mersenne primes.

Canon moving into biotech chip business

Japanese office equipment and camera maker Canon plans to branch out into biotechnology by commercialising DNA chips for use in medical diagnosis, aiming to build a new pillar for future growth.

The New York Times and Reuters report (29 Mar.) that the move comes on the heels of plans by Canon, the world's largest office machine maker, to enter the flat-television market by launching advanced flat panel displays as part of efforts to widen its business portfolio.

The paper and Reuters report that Canon said it will seek approval at its shareholders meeting this week to include "production and sales of pharmaceutical products" in its operational objectives, getting ready for the commercialisation of biotechnology products.

The NYT and Reuters say that as part of its biotechnology research, Canon is developing systems for the mass production of DNA chips that use the bubble jet technology employed in its printers and are aimed at helping with the diagnosis of cancer and infectious diseases.

The new method would allow DNA chips for diagnosing cancer and diabetes to be mass produced more cheaply than with existing technology, says the paper.

THe NYT says that the The Nikkei Business magazine reported this year that Canon planned to spend up to 10 billion yen (US$93.2 million) on mass production of DNA chips possibly in 2005 and that it wanted to post 100 billion yen of biotechnology-related sales in 2010.

Toshiba preps minute-charge 'miracle' battery

Toshiba has developed a Lithium-Ion battery capable of being charged to 80 per cent of its full capacity in under 60 seconds. Filling it up takes just "a few more minutes", the company boasted, reports The Register (29 Mar.)

The Register says that's considerably faster than today's Li-ion rechargeables which can take 1-4 hours to reach 80 per cent capacity, and even longer to fill completely.

The UK online publication says that Toshiba also claimed the new cell offers a greater longevity than today's Li-ion batteries, losing only one per cent of its capacity after 1000 charge cycles, according to the results of its own charge-discharge testing.

The Register says Toshiba says the miracle battery will come to market next year.

AOL Latin America may cease operations

America Online Latin America, the beleaguered provider of internet services in South America, has said that it was running out of cash and may shut down or file for bankruptcy protection.

The New York Times and Reuters report (29 Mar.) that unless AOL Latin America finds a buyer for its assets, it will have to close down operations, the company said in a regulatory filing with the US Securities and Exchange Commission.

The paper and Reuters say that AOL Latin America, founded as a joint venture between America Online and the Cisneros Group at the start of the internet bubble in 1998, has since struggled to become profitable.

The loss-making company, which provides internet dial-up service mainly in Brazil, Mexico and Argentina, stopped counting non-paying subscribers in 2003 as the SEC investigated the company's methods in counting subscribers, the paper and Reuters reeport.

According to the NYT and Reuters, other internet service providers have also struggled to stay in business in Latin America. StarMedia Network , Terra Lycos and Yahoo's efforts to build an access provider have fallen flat, the paper adds.

Sony in dispute over digital projectors

Sony Electronics a unit of Sony Corp., last week demonstrated a projection technology for digital cinema that displays images at twice the resolution of existing digital projectors, the new York Times and Reuters report (29 Mar.).

Reuters and the NYT say that Sony plans to begin shipping the system in July, setting up a race with Texas Instruments, whose technology is at the heart of digital projectors already on the market.

The paper and Reuters say that the competition is emerging at the same time Hollywood is looking to work out a fair way to roll out digital cinema nationwide in the US to replace the ubiquitous 35mm film projectors.

According to the NYT and Reuters, critics question how well the eye can distinguish between the 2,000 lines of resolution that current digital projectors have and the 4,000 lines Sony's new projector promises (by comparison, high-definition TV sets show up to 1,080 lines). They also question whether color separation and contrast are any better with a higher line count.

The report says Sony will begin shipping two models of its projector in July. The cost of outfitting a screen around Sony technology could range up to US$140,000.

Texas Instruments' DLP technology is already playing in 315 theatres worldwide. That number is expected to top 1,000 in the next 12 months, says the paper and Reuters.

VeriSign should keep .NET franchise says panel

An independent advisory firm in the US has recommended that VeriSign be given another six years to run the internet's third most popular domain name suffix.

The New York Times and Associated Press report (29 Mar.) that if approved,renewal of a contract to serve as master-keeper of ".net" directories would generate about US$20 million annually for VeriSign, which already makes more than US$200 million a year managing ".com." Owners of ".net" domain names could see lower prices when they renew.

The paper and AP says the domain name operator, known as the registry, also has the technical ability -- though some question whether it has the legal authority -- to make sweeping policy changes. In 2003, VeriSign briefly redirected web surfers who mistype ".com" and ".net" addresses to VeriSign's own search engine, breaking some spam-filtering programs and other applications in the process.

The report says VeriSign suspended that program under pressure and has since sued the internet's key oversight body, the Internet Corporation for Assigned Names and Numbers, accusing it of impeding efforts to offer new, moneymaking services.

VeriSign currently gets US$6 annually for each ".com" and ".net," though it promised to settle for US$4.25 in the new contract, 75 cents of which would go to ICANN, says the paper and AP.

Brazil an open source haven

Since taking office two years ago, President Luiz Inácio Lula da Silva has turned Brazil into a tropical outpost of the free software movement, reports The new York Times (29 mARCH).

The NYT says that looking to save millions of dollars in royalties and licensing fees, Mr. da Silva has instructed government ministries and state-run companies to gradually switch from costly operating systems made by Microsoft and others to free operating systems, like Linux. Brazil has also become the first country to require any company or research institute that receives government financing to develop software to license it as open-source, meaning the underlying software code must be free to all, the paper reports.

The paper also says that now Brazil's government looks poised to take its free software campaign to the masses. And once again Microsoft may end up on the sidelines.By the end of April, the government plans to roll out a much ballyhooed program called PC Conectado, or Connected PC, aimed at helping millions of low-income Brazilians buy their first computers.

And, says the NYT., if the president's top technology adviser gets his way, the program may end up offering computers with only free software, including the operating system, handpicked by the government instead of giving consumers the option of paying more for, say, a basic edition of Microsoft Windows.

The paper says Microsoft has offered to provide a simplified, discounted version of Windows for the program. Though a final decision on which software to install has been delayed several times, as has the program's rollout, Mr. Amadeu and some other government officials have publicly criticised Microsoft's proposal, calling the version's abilities too limited.

Under the program, which is expected to offer tax incentives for computer makers to cut prices and a generous payment plan for consumers, the government hopes to offer desktops for around 1,400 reais (US$509) or less. The machines will be comparable to those costing almost twice that outside the program, says the NYT.

According to the NYT., the program aims at households and small-business owners earning three to seven times the minimum monthly wage, or about US$284 to US$662. The government says seven million qualify, and it hopes to reach a million of them by year-end.

The paper says that may seem ambitious in a developing country of 183 million people where only 10 percent of all households have internet access and just 900,000 computers are sold legally each year, although including black-market sales, the number is closer to four million.

Wednesday, 23 March 2005 18:00

News Roundup 23 Mar 2005


Oracle wins Retek battle for US$670 million

Business software maker Oracle HAS beaten out German rival SAP in its bid to buy Retek, reaching an agreement to purchase the retail software maker for about US$670 million. Oracle said Tuesday.

The New York Times/AP report (22 Mar.) a statement by Oracle that its offer of US$11.25 per share was accepted and SAP has dropped out of the bidding.

"Oracle has the largest applications business in North America and we intend to expand that leadership position," Oracle CEO Larry Ellison said in a statement. Combining Oracle with Retek is an important step in that direction, and it strengthens our position in the retail applications market globally."

The NYT reports that in Germany, SAP said that expansion "must happen at a price that does not cause damage to SAP's good financial performance."

"As a responsible investor, SAP made an appropriate offer," SAP chief executive Henning Kagermann said in a statement. "Neither SAP's investors nor the present and future customers in the trade segment would have benefited from a further bidding battle -- and nor would it in the long term have brought the success that we expect.", reported the NYT

The paper says that SAP thought it had reached a deal to buy Minneapolis-based Retek for US$8.50 per share late last month before Oracle topped the offer, starting a bidding war between the two rivals.

The gamesmanship pitted the world's two leading makers of business applications software -- the computer coding that automates a wide range of administrative tasks, says the NYT, adding that SAP has long been the industry leader, but Oracle closed the gap two months ago by buying PeopleSoft for US$10.3 billion after a heated battle that dragged on for 18 months.

With just US$174 million in annual revenue and 525 employees, Retek is a niche player in the industry. Nevertheless, the company holds tremendous appeal for both SAP and Oracle because its 200 customers are retailers -- a group that hasn't bought as much business applications software as many other industries, says the NYT.


Time Warner-SEC settle for US$300 million
Time Warner has agreed to pay US$300 million to settle a complaint by the US Securities and Exchange Commission that the company's AOL unit overstated revenue for nine quarters.

The New York Times reports (22 Mar.) that Time Warner had initially settled with the SEC staff in December. Yesterday's final settlement with the SEC's commissioners neither admitted nor denied the allegations in the complaint, the SEC said, the paper reported.

The paper says that at the same time, the company agreed to have an independent examiner, who would either be an accountant or would hire one, determine if the company's historical accounting for some transactions was in accordance with generally accepted accounting principles. The examiner is to report findings to the board within 180 days. Those findings could force the company to further rewrite historical results, says the NYT.

According to the NYT., the settlement mirrors a similar settlement reached in December that resulted from a separate investigation by the Justice Department.

The total cost of the two agreements is US$510 million, but the settlements are slightly different. For example, the Justice Department's settlement required that AOL hire a person in its offices to monitor its accounting practices for at least 2 years and possibly as long as 30 months. As part of yesterday's settlement, Time Warner has agreed to restate earlier advertising revenues by US$500 million and to reflect more accurately the consolidation of AOL Europe, among other adjustments, reports the NYT.

Thde paper says that in a separate administrative action, three Time Warner executives reached settlements with the SEC in which they neither admitted nor denied wrongdoing for improper accounting related to US$400 million that Bertelsmann paid Time Warner.

The SEC and the Justice Department could still file additional complaints against individuals involved in AOL's accounting scandals, and yesterday's settlement did not rule out further actions from both agencies related to other individuals, according to the NYT.

The NYT says the settlement puts a difficult period behind Time Warner. While under investigation, it was barred from some financial activities, including issuing stock. The paper says the chief executive, Richard D. Parsons, is eager to acquire more cable systems and has made a joint bid with the Comcast Corporation for the cable operations of Adelphia. The settlements allow the company to pursue those bids.


Diller bets on internet in Ask Jeeves bid

The New York Times says that for years, Barry Diller of IAC/InterActiveCorp has been searching for the right blend of companies that will realise his lofty predictions about the future of internet commerce. Now the latest object of his search is ... search.

The paper reports that Diller announced yesterday that his company would buy Ask Jeeves, a distant fifth in the search market dominated by Yahoo and Google, for stock valued at US$1.95 billion.

InterActiveCorp shareholders wondered whether the acquisition was a sign of Mr. Diller's brilliant deal making or a bad bet on a small player that will never be able to compete with its far bigger rivals, says the paper. but adds that one sign that the deal may bolster Mr. Diller's reputation was the complaints that ensued among Ask Jeeves shareholders who said that the price was too low.

The NYT reports that as part of the deal, InterActiveCorp agreed to exchange 1.2668 of its shares for each share of Ask Jeeves. Based on the closing stock prices Friday, that valued Ask Jeeves at US$28.24, a 16 percent premium over Ask Jeeves's closing price of US$24.24 on Friday. The bid is still well below the company's 52-week high of US$44.66, the paper says.

Diller, who has long resisted the idea of tying his properties together with some sort of portal or overarching site, dismissed the idea that Ask Jeeves would push customers to his other companies, the NYT says.  He said in an interview that IAC's companies would receive no preferential advertising treatment from Ask Jeeves.

The NYT says whether the deal ultimately pays off may depend on the ability of Ask Jeeves to match the product-development and marketing power of Google and Yahoo.

But, Diller said the acquisition did not depend on Ask Jeeves catching up to the search engine leaders with their larger technology investments, says the NYT.

The paper says Nielsen/NetRatings calculates Ask Jeeves' share of total internet searches at 5 percent, compared with 47 percent for Google and 21 percent for Yahoo. No. 3 is MSN from Microsoft, and No. 4 is the America Online unit of Time Warner.

But, the flagship site of Ask Jeeves, has a far smaller audience than those numbers would indicate, with only 1.8 percent of total searches. Ask Jeeves's remaining searches come from sites acquired last year as part of its purchase of Interactive Search Holdings, including, and, the NYT reports.


Qwest-Verizon duel of letters, trying to buy MCI

In the US., the takeover fight for MCI has taken another twist when the chairmen of Qwest Communications and Verizon Communications both released letters stating their cases for being permitted to buy the troubled long-distance carrier.

The New York Times reports (22 Mar.) that Qwest's chairman, Richard C. Notebaert, sent a letter to MCI expressing his concern that his company's latest bid was being ignored. That came a few hours after Ivan G. Seidenberg, Verizon's chairman, made public a 10-page letter that dismissed Qwest's projected cost savings from an MCI purchase as "modern fiction."

The paper says the letters were the latest volley in the increasingly bitter fight between the companies for control of MCI. In mid-February, MCI's board agreed to sell the company to Verizon for US$6.75 billion, despite an US$8 billion bid Qwest had made a few days before. Last Wednesday, Qwest raised its offer to US$8.45 billion.

The NYT says several influential MCI shareholders have filed lawsuits demanding that the company consider Qwest's higher offer. MCI's board, which spent the two weeks that ended 17 March re-evaluating Qwest's bid, is expected to meet as early as this week to decide on the latest offer, says the paper.


Investing firms to offer US$10.5 billion for SunGard
A consortium of seven private investment companies is close to a deal to buy SunGard Data Systems for more than US$10.5 billion, executives involved in the negotiations in the US said yesterday.

The New York Times reports (22 Mar.) that the consortium - Silver Lake Partners, Kohlberg Kravis Roberts & Company, the Carlyle Group, Bain Capital, the Texas Pacific Group, the Blackstone Group and Thomas H. Lee Partners - is hoping to reach an agreement by the end of this week, the executives said.

The paper says the transaction would be one of the largest leveraged buyouts since Kohlberg Kravis bought RJR Nabisco in 1989 and would be the biggest deal ever involving a team of multiple firms.

SunGard, which provides software and services to top financial companies, said yesterday that its board had authorised its advisers and management to engage in discussions to sell the company but did not identify the potential buyer, says the paper.

SunGard employs more than 10,000 people, has long been viewed by rivals as a takeover target but had been considered less attractive because its two businesses appealed to different suitors, sasys the paper.

The NYT adds that a company spokesman said that over the last year it has focused on its plans for growth. The data recovery unit competes directly with IBM., while the software unit, the bigger of the two, faces a more fragmented market.


Licensing settlement ends Rambus patent suit

Ending a long-running patent dispute over computer memory, Rambus and Infineon Technologies settled all of their legal claims against each other on Monday, reports AP and the New York Times (22 Mar.).

The NYT and AP say that under the deal, Infineon, the German memory chip maker, will pay Rambus a quarterly license fee of US$5.85 million, starting 15 November and ending two years later. After that, Infineon could continue to pay up to an accumulated total of US$100 million if certain conditions are met.

The paper says that Rambus, meanwhile, was granted a perpetual license for Infineon's memory interfaces and agreed to treat the company as a "most favored" customer.

Rambus does not manufacture chips but licenses designs that improve communication between a computer's microprocessor and its memory. The interfaces are critical to avoid data bottlenecks between ever-faster processors and memory chips, says the paper.

The paper says the settlement comes three weeks after a federal judge in Virginia dismissed Rambus's patent claims. At the time, Rambus said it had a strong case on appeal. Under the settlement, Infineon will make quarterly payments that will not change even if the number of memory chips incorporating Rambus technology increases, said Christoph Liedtke, an Infineon spokesman.


Symbian gets synch software from rival Microsoft

British mobile phone software maker Symbian has agreed to license synchronisation software from long-time rival Microsoft in an effort to win more corporate customers, the company has just announced.

The New York Times/Reuters report (22 Mar.) that as a result, users of smartphones that run on Symbian software, over 20 million devices, will be able to wirelessly receive emails via network computers that run Microsoft's Exchange Server software. These servers are used mainly for Microsoft's Outlook email and calendar applications.

The paper and Reuters also report that Nokia, which sells most of the Symbian-based smartphones, last month signed a deal with Microsoft to license the same software, called ActiveSync, for use in its enterprise devices such as the Communicator.

The collaboration is intriguing, say Reutersa/NYT., because Symbian was set up by the world's biggest mobile phone makers in the late 1990s as a force against Microsoft, which handset makers believed was aiming to dominate the cell phone industry in the same way it had become the de facto operating system for personal computers.

But six years on, says the paper/Reuters, Microsoft's market share in operating software for mobile phones has not crossed 1 percent. Meanwhile, corporate employees have to come to expect email on their mobile devices as it was pioneered by the Blackberry device, from Research In Motion.

Symbian continues to support a wide range of other email synchronisation protocols such as RIM's Blackberry Connect as well as the Open Mobile Alliance Data Synchronisation protocol, the NYT/Reuters report.


MIT backs open source for Brazilian poor

In the US., the director of MIT's Media Lab has recommended that Brazil install open-source software on thousands of computers that will be sold to the poor, saying proprietary software programs like ones offered by Microsoft may be less attractive.

"We advocate using high-quality free software as opposed to scaled-down versions of more costly proprietary software," Walter Bender, director of the Media Lab at the Massachusetts Institute of Technology, said in a letter to the Brazilian government obtained by Reuters on Thursday and reported in the New York Times (22 Mar.).

The paper and Reuters say that President Luiz Inacio Lula da Silva and several ministers may decide as early as this week whether free software or a simplified version of Microsoft Windows will be installed on computers for a new effort called PC Conectado, or the Connected PC.

According to the report, the effort aims to sell up to 1 million computers, with costs partially subsidised by the government, to lower middle income Brazilians this year.

The paper and Reuters say a final decision on which software to install has been delayed several times. Some cabinet members think consumers should have a choice between buying a computer with open-source software and paying slightly more for a machine with Microsoft software.They think this approach would make sense to reach consumers who are already familiar with Microsoft software.

Brazil, the world's fifth most populous country and a growing economic power, has taken a prominent role in the so-called free software movement, an effort that champions free computer operating systems like Linux as an alternative to Microsoft's Windows program, say Reuters and the NYT.

The paper and Reuters say many government agencies are migrating to Linux to cut millions of dollars in software licensing costs.


Sony gears up for US PlayStation portable launch

There is no doubt that Sony will have a hit on its hands in the PlayStation Portable video game and media player which launches next week -- and there is no doubt the industry needs it, reporets the New York Times and Reuters (22 Mar.)

The paper and Reuters say demand is so high for the PSP in the United States that the unit has become virtually unavailable in Japan and Sony has postponed the European launch by months to boost US supply. The paperback-book sized unit launches 24 March in North America.

The NYT and Reuters say Sony is counting on the PSP for much more than its gaming capabilities. In addition to games, the PSP plays movies and digital music files and also acts as a photo viewer. It could be Sony's best chance yet to challenge the ever-increasing dominance of Apple Computer iPod digital music players, says the report by the NYT and Reuters.

The paper and Reuters say that foremost, though, the PSP is for video games, and its release could not have come at a better time for the US$10 billion US video game industry. Handheld games -- for the PSP as well as Nintendo Co. Ltd.'s Game Boy Advance SP and DS -- are expected to be the primary driver of US software sales this year. Analysts expect sales to be flat to up 5 percent.

The impending release of the PSP has helped cheer video game stocks. For the year to date, shares in THQ are up 26 percent, Take-Two Interactive Software shares are up 17 percent, Activision shares are up 15 percent and Electronic Arts shares are up 8 percent. In comparison, the Nasdaq is down 7 percent, the paper and Reuters report.


HP to buy closely held Snapfish

Hewlett-Packard has just agreed to buy closely held online photo service company Snapfish as the computer and printer maker aims to capitalise on the fast-growing online photo printing market.

The New York Times and AP report (22 Mar.) that financial terms of the proposed acquisition of Snapfish, which claims more than 13 million registered users, weren't disclosed. HP said that Snapfish is the largest online photo service firm, leading Eastman Kodak's Ofoto, closely held Shutterfly, dotPhoto and others.

According to the report, San Francisco-based Snapfish provides free online photo sharing, photo storage and management, free editing and software, as well as online print ordering, and some 70 photo gifts such as picture-emblazoned coffee mugs, T-Shirts and other items.

HP said that Snapfish's members are growing at a rate of more than 500,000 members per month and said that 90 percent of Snapfish's customers recommended the service to others, the NYT and AP report.

An HP spoklesman said the company thinks online digital photography will be a multibillion dollar opportunity and it intends to get its fair share of that.

The NYT and AP say the move also comes after Yahoo agreed earlier on Monday to buy Ludicorp Research & Development and the popular Flickr photo-sharing web site it created.

The report says the imaging and printing business is considered the crown jewel of HP, which is the world's largest computer printer company, but faces stiff competition from Lexmark International. HP's printing business, which also consists of selling replacement ink cartridges that are highly profitable, still accounts for the lion's share of HP's operating profits, the paper and AP add.

HP said that, for the time being, it will keep the Snapfish brand name, but that could change over time. Current users of the HP Photo web site will be moved gradually over as Snapfish customers.

The paper and AP say that Snapfish was founded as a venture backed company in 1999 and was acquired in 2001 by closely held District Photo, which on its web site describes itself as the world's largest direct-to-consumer photofinisher.



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