17th > September > 1998 Archive

The Register breaking news

Microsoft promises NT 5 in 1999 – beta 3 by Thanksgiving

Microsoft now claims it will be able to deliver beta 3.0 of Windows NT 5.0 to end users by Thanksgiving Day, and that it is firmly on target to deliver the complete version in 1999. That emerged during a presentation by a Microsoft base architect NT 5.0 engineer to an audience of developers at Intel’s forum in Palm Springs. He told a small group of delegates: “I’ve more confidence than ever about our ship schedule. This is a 1999 product. There will be a beta out around Thanksgiving.” Any changes, he said, will revolve around improvements in performance. “We are nearly code complete. If you produce a BIOS that works with beta 2.0 of NT 5.0, it will be honoured in the future, that’s how confident we are.” The architect outlined a number of the features of NT 5.0, including improvements to the shell, extra storage and storage management features, support for Unicode 2.0 giving support for over 60 languages, performance improvements, better local networking support, security features and hardware. The hardware improvements, he said, were the most important part of NT 5.0. The OS will have support for ACPI, USB, 1394, multiple displays, DVD, AGP, and the Win32 driver model. “We have more legacy support than 4.0 including printers and scanners,” he said. “We are very competitive to Windows 98 with our drivers.” ®
The Register breaking news

Gore relaxes encryption restrictions

The US is relaxing controls on encryption keys exports from 40-bits to 56-bits keys, vice-president Gore has announced. The pressure for such a move had come from vendors who were concerned that the US used to have essentially the whole market for encryption products, but there are now in excess of 500 non-US products with 128-bit or greater encryption. The compelling market need is to protect e-commerce payments, but human rights workers based in hostile political environments who want to protect messages are often cited as a reason for stronger encryption exports. The relaxation will not apply to countries where the US government considers there is significant money laundering (Florida? - Ed). The US IT industry is generally of the opinion that the 64,000-fold increase in security by going to 56-bit encryption from 40-bit is not enough. In June, the Electronic Frontier Foundation confounded the FBI claim that it would take months or years to crack 56-bit keys: the EFF demonstrated this being done in a few hours. Perhaps this is why the White House plans, as part of the move, to set up a technical centre for law enforcers -- to bring them up to speed. When 56-bit products were specifically allowed to be exported in the past -- to financial institutions for example -- they had to have a back door for the feds by December 1998. There have been recent moves to get this deadline extended, probably to increase pressure for a policy relaxation, rather than for a valid technical reason. The new regulations are expected to come into effect later this year. ®
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Intergraph demands instant conviction for Intel

Intergraph has filed a motion in the Huntsville, Alabama district court requesting a summary judgement in its case against Intel. CEO Jim Meadlock said that "There's no sense in spending resources to prepare for and conduct a trial on the matter. The judge can rule based on the evidence at hand." Filing for judgement is the same legal stratagem that Microsoft tried unsuccessfully last week. It is rarely granted, but commercial cases have a better chance of such judgements than ones where the government is a party. An impediment to such judgements is where there are no significant factual issues that require examination in court. Intergraph obtained an injunction against Intel in April, following its November suit alleging that Intel had indulged in anticompetitive behaviour, patent infringement and violations of antitrust law. Intel appealed against the injunction. The judge has set a deadline of 14 February 2000 for a resolution of the dispute, or the matter will go to trial. Intergraph's results for the last quarter, reported at the end of July, showed revenue of $247 million for the quarter, down from $289 million in the year-earlier quarter, and losses per share up to $0.43, ten cents worse than a year earlier. Intergraph blamed the effect of the litigation with Intel. Intergraph's business is focussed on commodity-priced Windows hardware for 3D graphics, competing with UNIX boxes. The FTC, which has its own case against Intel, is doubtless watching the outcome of the Intergraph case as it is credited with having convinced the FTC to act. ®
The Register breaking news

FCC plans faster US modem access

Faster modems may result from a small relaxation on the signal power limit for modems, which is being considered by the Federal Communications Commission. At present, the FCC enforces a regulatory limit that keeps pulse-code modulation modems to a maximum of around 53 to 54Kbps, although most rarely exceed 40 to 42Kbps because of line quality. The technical capability of a modem may be higher, but it will not operate at higher speeds in the US. The FCC is now expected to invite the industry to comment on higher signal powers. The invitation should appear in the Federal Register (no relation) in the next few days. Only modest improvements in modem speed may be technically possible (a story that has been familiar since the days of 110 baud, we recall). The FCC now believes that higher signal powers might not damage networks. Whether there will be an increase depends on the views expressed by modem manufacturers, and the carriers' views about network capacity, line noise and quality. The opportunity for comment will last for 30 days, but electronic filings must be made in WordPerfect 5.1. It is rather amusing for a regulator to specify a non-standard code (we mean ISO, or ASCII as it is locally known, not that other proprietary word processor code). The International Telecommunications Union has just approved V.90 56Kbps modem speeds as a standard. There were two camps in the US: the Rockwell K56 technology, which has used V.90 since it was defined, and the 3Com X2 technology, which has now lost out. Recent glitches reported in iMacs not being able to access certain ISPs was put down to the ISPs not having implemented V.90, Apple said. ®
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HP admits job cuts on the cards

Hewlett-Packard is to undergo a restructure which will involve the loss of jobs, chairman Lew Platt said yesterday. Platt did not discuss how the restructure would change the operation of the company, or state where the staff cuts would be implemented, or how many redundancies would be involved. But he was emphatic that "undoubtedly there will be some personnel cuts as part of the restructuring. At this point in time, we expect all of that will be done through voluntary means". When answering questions at the IDC European IT Forum in Paris last week, Platt admitted he was pinning his hopes for HP's success on Europe following a downturn in the company's US business and continuing problems in Asia (see Europe to lead on growth). That suggests the EC is unlikely to bear the brunt of any major chanages at the company. Platt's latest comments, made via teleconference to an audience in Singapore, follow the company's admission that it expects to take a $150 million hit on it Q4 results to cover cost-cutting programmes. It has already imposed a five per cent pay cut on 2400 managers for a period of three months. ®
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AOL responds to DoJ IE claims

Steve Case, chairman of AOL, has been correcting the record concerning Microsoft's wooing AOL to Internet Explorer and away from Netscape Navigator. Speaking at the Upside conference yesterday in Washington, Case said: "Our choice was Microsoft, in large part because they provided [IE] free and also were willing to bundle us with their operating system." The AOL icon was better placed than the MSN icon -- a decision made directly by Gates because he was determined that AOL would only distribute IE. Initially, Gates had opposed VP Brad Silverberg's suggestion as to where the icon should be. Silverberg is on long-term leave of absence, and the last report was that he was bicycling in Canada. He has not given a deposition in the case. Microsoft told another story to Judge Jackson on 11 September when it claimed that AOL had chosen IE as a result of "its superior features in a side-by-side comparison". An email from Gates, produced by the DoJ, showed that Gates believed that Case considered IE to be an inferior product. At the same conference, Roberta Katz, general counsel for Netscape, said that Gates knew that offering the prime desktop position for AOL's icon "was going to be the clincher, because no one else has that kind of power". Meanwhile, AOL has hired Geraldine Laybourne's Oxygen Media to run its three women's sites, in the hope of keeping the female 51 per cent of AOL's users happy. She was formerly president of Disney/ABC Cable Networks, and persuaded Disney to supply some start-up funds for Oxygen. ®
The Register breaking news

Netscape goes onto the attack

Netscape has upset Microsoft with the Communicator 4.5 release 2 preview by making it very easy to set Communicator as the default browser. According to Dave Bottoms, the product manager, it is Netscape's intention to go after Windows users who were forced into Internet Explorer. The installation process puts icons for Navigator on the tool bar, for one-click access to Netscape's Navigator browser, the Messenger email client, and the Composer editing tool. And that's not all: it pops a Smart Update icon in the Windows Start menu to make it easy to download future upgrades, which may include non-Netscape software in the future. Although it was possible for users to change the automatic IE default browser settings by following a rather complex series on instructions on Netscape's Web site, relatively few people did this. Now Microsoft's Mike Nichols is complaining that what Netscape is doing is "creating this proprietary tie to their portal". It is but poetic justice that users are not first alerted that the default home page of IE is being changed. Netscape's Bottom says that "until now, Windows has restricted access from Netscape products." It was only a few weeks ago that RealNetworks, now a firm friend of Intel following its licensing of Intel's video compression technology, was the victim of Microsoft's alleged meddling with RealPlayer, in favour of Microsoft's Media Player. Zona Research's Julia Pickar said that fewer than ten per cent of home users changed their home page, but Netscape said that its research showed 40 to 50 per cent changing the browser from the default home page. ®
The Register breaking news

Acorn scrubs Risc PC 2

Talk about timing. Less than a week after buying Acorn User from IDG media in a management buyout, editor Steve Turnbull’s plans to "reinvigorate the entire Acorn market" lie in tatters. Because Acorn ain’t playing ball. It has scrapped Phoebe, the Risc 2 project, upon which the hopes of the Acorn user and reseller community were pinned. The move is part of a "fundamental restructure" which will enable Acorn to become more focused as a "digital TV and thin clients components company", it said. Originally slated for a November launch, Phoebe exists now solely as the spec that never was. The company has also rung the death-knell for its annual show for the Acorn community. It says the event is postponed; but unless there is any exhibition organiser foolhardy enough to run with the baton, it seems that Acorn users will have to restrict future gatherings to the car boot sales that proliferate across the country. Acorn says it will continue to supply its existing, rapidly ageing Risc PC line -- so there will be plenty of spare parts knocking about. But who would buy a new Risc PC, given that its manufacturer is so keen to get out of the business? Under the restructure, announced today, Acorn is also transferring all systems and logistics business to Xemplar, its 50 per cent owned joint venture with Apple. Staff numbers are reduced from 175 to 100, with more than two-thirds of non-engineering staff going. Engineering staff who survive the cull are to be reorganised into direct revenue-earning design and consultancy work. Stan Boland, newly promoted chief executive, commented: "Today's announcement marks a significant watershed in Acorn's history. Whilst we are sad to be announcing the redundancies, we are making these important changes to Acorn's market position and business shape to recognise that the future of this company lies as a leading player in the digital TV system components, and in partnership with other technology companies. "Acorn's ability to create very fast and powerful silicon and software designs for some of the world's leading companies is increasingly being acknowledged. We are working hard to engage successfully in this market with a number of partners and potential partners." Acorn users and resellers are quick to spring to the defence of the vendor whenever it receives a slight -- imagined or when it comes from The Register . But this time will they have the heart to orchestrate another letter-writing campaign to us, seeing as their beloved vendor has so signally kicked them in the teeth? Our best wishes to the new owners of Acorn User. It is often easier to make money from a market in decline. At least you know that no one else is going to come along with a spoiler launch. ®
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OEM deal strengthens Hitachi enterprise storage line-up

Hitachi Data Systems Europe has signed an OEM agreement with Sutmyn Storage, to distribute the American company's Scimitar Virtual Tape Systems across Europe. Sutmyn has also certified Hitachi Freedom Storage 5700E and 7700E disk storage systems for use with its VTS (Virtual Tape Server) solution. The Scimitar VTS provides the image of multiple tape drives and allows enterprise data to be recorded and retrieved at disk speeds while conforming to standard tape protocol. Fully interoperable, it works with any MVS-defined cartridge tape and/or robotics technologies currently installed at customer sites. The Scimitar/VTS solution can support up to 64 Virtual Tape Drives, eight ESCON channels and over 1.6TB of effective storage capacity. HDS sales operations manager Chris Atkins said the company was doing well, but needed to raise its profile. "We are increasingly frustrated by our lack of visibility in the storage market," he commented. "We have been in this business for 15 years and account for about 30 per cent of European gigabyte shipping for mainframes." HDS is now pursuing the UNIX NT market segment. "EMC is doing similar things and we often find ourselves in direct competition for contracts," Atkins said. "We believe we are winning the bulk of these at the moment." Atkins said that the Sutmyn deal, along with its 5700E system would be key to growing HDS's lower end market share. HDS will distribute the Scimitar/VTS under the Hitachi brand name through its existing channels in Denmark, France, Israel, Norway, Sweden, Switzerland and the UK.®
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Compaq takes on Germany with local assembler-built Pcs

This weekend sees the first fruits of an OEM deal between Compaq and a German PC assembler go on sale as Compaq attempts to boost its sickly European home PC market share. With Germany accounting for 25 per cent of the European home PC market and Compaq only managing to rank tenth with just two per cent of the German home PC market, the vendor claims it is now poised to leapfrog its way up the European home PC league tables by getting a German PC assembler to build Presarios in former East Germany. Dresden-based Schaefer-IT-Logistics will build the Compaq-branded Presario 5501. Toon Bouten, vice president for Compaq EMEA consumer PC division, explained that Compaq’s usual sparring partners are no longer the enemy. “Traditionally, we have competed with the likes of IBM and HP, but we have more market share than them and we’re still only at number 10. In Germany, local assemblers account for 78 per cent of the home PC market, so we have to learn to operate like them,” he said. Bouten said he expected Compaq to have reached the number five spot for home PC sales in Germany within six months. German home PC purchasers are very price conscious and have been unwilling to pay for machines with high specifications, such as those sold elsewhere in Europe. The Schaefer-built Compaq PC will not have an internal modem - one feature the German PC buying public turns its nose up at -- and will be priced at DM1699 ($1,007). Schaefer OEMs PC for a number of German retailers and will handle all manufacturing of the cut-price Presario. Product life cycles will be reduced to around four weeks and no price protection will be offered. Bouten said the revised German business model would not work in other European countries, but said it was based on a concept that would.“The key is to develop models that address specific markets. In the UK we have to look at the way local assemblers, such as Tiny, operate.” ®:
The Register breaking news

Seagate builds film drives for Kodak

Eastman Kodak and Seagate are joining forces to create improved APS-camera-to-computer technology bridges. The alliance covers marketing, manufacturing and sales, and the two companies will work to develop the next generation of film drives. Under the terms of the deal, Seagate gets exclusive manufacture and sales rights for Advantix film drives,which will sold as either as in-bay products or external peripherals. Stephen Luczo, president and CEO at Seagate, commented: "Our strategic focus is on delivering products and technology that enable people to get information the way they want it. That information could be in the form of a picture or a thousand words - as long as it is how they want it." Kodak is already marketing two drive models and software that scan in the negatives from the film cartridges, and upload the images into a PC. Users can then manipulate the images, for example eliminating red-eye, correct colour, as well as specify any of the three APS print formats. &Reg;
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Acquisitions pay off for Compel

Welwyn Garden City-based reseller Compel has revealed healthy growth in turnover and profit in its financial results for the year ending 30 June. Turnover was up some 88 per cent to £210.0 million, compared with £111.8 million for last year. Profit before tax stood at £9.0 million, up an impressive 78 per cent from last year’s £5.1 million. A representative of Compel said the whole group had performed well and companies acquired over the course of the last year had been integrated into the business smoothly. “We’ve won some new contracts and all parts of the business are doing well - including the new acquisitions,” he said. Compel went shopping three times last year, first it bought P&P Rentals in March 1997, second was Computer Microrentals in August 1997 and finally Scotland’s largest reseller, Abtex, was snapped up in October 1997 in a deal worth as much as £4.5 million. The two rental companies have been merged into Hamilton Rentals, Compel’s existing rental business. Taking the acquisitions out of the equation, turnover grew 68 per cent over the year. Last year, Compel was appointed the sole UK member of the GlobalServe alliance, an international reseller partnership intended to enable resellers without overseas subsidiaries to play on the global stage. It was also pitched as a credible alternative to dealing with multi-national operations such as GE Capital. The spirit of internationalism seems to be stalking the channel with resellers such as Info’Products and Elcom forming loose alliances with overseas companies as a way of raising their profiles. Last year, The Register predicted that the Abtex deal would turn out to work for Compel, when we said: “UK resellers are notoriously bad at acquisitions - but Compel appears to have the knack of making them work. Probably because it never bites off more than it can chew.” It looks like we were right.®
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Intel makes bid to capture security lead

Chip company Intel is to make a bid to dominate the security market by introducing up to ten hardware primitives into its chip sets and CPUs. Pat Gelsinger, general manager of Intel's business platform business, said: "We found ourselves talking to IT customers that security is an increasingly important component in a connected environment. Many security methods are ad hoc and incomplete." He said that the different security requirements, mostly implemented in software, boiled down to common primitives that could be incorporated in hardware. Those include random number generation, monotonic counters and digital signatures, he said. He said that the primitives will be built into both chipsets and CPUs and will start to be implemented in 1999. Gelsinger said that hardware provided, for example, a better method of random number generation by using analogue and digital signals from within the PC environment itself. In other news, Gelsinger announced that Intel will cooperate with other industry players to form the digital display working group. This is intended to bring more standardisation and better quality to LCD displays. "This is going to give screen kissing good displays," he said. I'm really excited about this." ®
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Industry majors team up on digital displays specs

Most of the major players in the PC industry have teamed up to create a working group to define a specification for digital displays. IBM, Intel, HP, NEC, Dell, Fujitsu, Intel and Silicon Image will work together to define an extensible interface specification which will address protocol, electrical and mechanical definitions. The members of the working group said that they hoped to deliver an open specification by the first quarter of next year. ®
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Datatec scoops up RBR Networks

Datatec Ltd has plugged a huge gap in its networking equipment franchise line-up with the £25 million (including performance guarantees) purchase of Cisco-only distributor RBR Networks. With sales projected to reach £80 million this year, RBR says it accounts for more than 50 per cent of Cisco sales through the UK channel. The company will continue to operate its “Cisco First, Cisco Only” model, as a Datatec subsidiary, but it will now has the financial muscle to extend its reach as Datatec’s Cisco distribution arm. Following the deal, Datatec’s UK networking distribution business commands an annual revenues of more than £120 million. The company also gets its hands for the first time on a Cisco franchise in Europe. Datatec’s UK existing distribution business, Unity, is to be renamed, following the June takeover of US networking distributor Westcon. The RBR management team appeared to have negotiated a fair degree of autonomy. In the longterm it will trade as Westcon RBR. But for now the Cirencester-based operation retains its current brand name. More fundamentally, RBR’s management team will set company direction. Datatec runs a substantial Cisco business out of South Africa. It reckons group Cisco revenues will hit $200 million next year. However, this is not clear whether this figure includes end-user sales through its reseller arm.®
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Pat ‘Kicking’ Gelsinger gives Register massage

Disaffected employee 1: Credit Lyonnais O For three glorious days last week, anyone who linked into www.credit-Lyonnais.com saw a picture of a naked woman and a speech bubble ("I like Arab men...take me now").
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Intel spells out details of Merced simulation programme

Intel is engaged in an attempt to sign more developers up to its Merced pre-silicon development environment programme. Earlier this week, Craig Barrett, Intel’s CEO, said that a Merced processor will arrive in the middle of the year 2000. Silicon samples are expected in the second half of next year. The company has around 50 companies using the Merced environment, which provides multi-processor simulation, simulates the entire platform and allows basic tuning. According to Rumi Zahir, senior computer architect on the IA-64 programme at Intel, this is the first time that his company has been able to offer a complete simulation environment for one of its CPUs. So far, the list of OS vendors publicly committed to the platform include Novell with Modesto, Digital, Microsoft with Win 64, SCO Unixware, Sun with Solaris, SGI with Irix and HP with HP/UX. Zahir said that Merced will have features built in to maximise its performance, which are also present in the pre-silicon environment. Those include an instruction address range check, a data address range check, an opcode matcher for monitoring speculative or predicated instructions, and event address registers (EARs), used to improve monitoring accuracy for branch mispredicts, cache misses and other events. Zahir said that one of the reasons for developing the environment was to allow software developers a chance to optimise their code, if necessary. The IA-64 processor software model, he said, would allow unmodified IA-32 apps to run. But, as a halfway house, software companies could recompile their applications in 32-bit pointer mode which will give them a performance kick. He said: “Some applications want 64-bit pointers, for example database programs and scientific programs.” Those companies would have a chance to re-develop their apps using the environment well before the release date. “We want to bring across the entire software stack,” he said. “You’ll even be able to run Edlin if you want to.” See also Compaq kicks Intel's Merced butt while it’s down. ®
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Taiwan suffers chip catastrophe

UMC has said it is going to put a stop to a massive investment it was going to make because of the oversupply problem in the chip industry. The foundry was going to spend nearly $15 billion to build state of the art fabrication plants but has pulled the plug on the project. Earlier this year, The Register reported that Taiwan was suffering more than most from the problem with semiconductors. See Taiwan suffers from memory glut. At the Computex Trade Show in June, executives from different top Taiwanese companies stepped up to different platforms to say things were not working out as planned. Semiconductors was the major complaint of most, whether LCDs, IC support chips, and DRAMs. Earlier this year we reported exclusively on that oversupply situation. UMC’s decision will have been modified by the state of affairs on the island, which is not only afflicted by the general Asian malaise, but also by uncertainty as to its future, given US president Bill Clinton’s assertion that Taiwan should be part of Red China. Two weeks ago we reported that a Chinese consortium was in talks to acquire Siemens’ doomed state of the art fab in the North East of England. That now seems increasingly unlikely. ®
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Hatch says leave Intel bunnies alone

A US senator has taken the bold step of asking the Federal Trade Commission (FTC) to lay off Intel. Senator Orrin Hatch, the republican representative of the state of Utah, formerly the home of both WordPerfect and Novell, has instead advised the FTC to take a further look at Microsoft. Hatch was responding to an impassioned speech from another republican, Haley Barbour, who said that Microsoft should not receive as much investigation as it currently is. Barbour claimed that Microsoft was pursuing free market principles and if it was brought to its knees by a federal body, that would badly affect the United States. Hatch took a different view and stoutly maintained that alleged monopolies were not only bad for the US, but for the rest of the free world too. He said: “While it may be likely, and even, to a degree, useful, to have a particular firm dominate at any point in time, it is dangerous, unhealthy, and harmful to innovation and consumer welfare.” He claimed that Microsoft could use its monopolistic situation to stop others from competing against it. Intel, on the other hand, did not have that point of view, continued Hatch. ®
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SGI MIPS not Compaq chips

As reported here many, many moons ago, Compaq is to ditch MIPS chips in favour of its newly acquired Digital Alpha platform. The news came formally at an announcement in Paris but senior executives at Compaq had made no secret whatsoever of their plans. The real news was that Compaq decided to issue a press release to tell the world something most interested people already knew. It is now possible that Compaq supremo Eckhard Pfeiffer will fulfil the next part of his agenda and tell Intel that unless it pays attention to its customers at the high end, it is possible that Merced may not be quite as important to the Houston-based PC company as it thought it might be. See also Compaq kicks Intel's Merced butt while it’s down. ®