30th > October > 1998 Archive

The Register breaking news

Gerstner files to cash $20 million in IBM shares

Lou Gerstner has filed to sell 142,000 of his IBM holdings, worth a cool $20 million at today's prices. The sale will make a fair old dent in his current portfolio -- around 500,000 shares worth $60 million -- but diversification is a challenge for unlucky Lou. The trouble is he can't sell shares fast enough. He has a further three million shares in stock options coming to him, and at current prices these would net him nearly $50 a share. But we're most unlikely to be talking about current prices, aren't we? IBM's stock price is currently nudging $150, and over the option period Lou can expect (matter of fact, we believe he has some influence here) the price to appreciate somewhere between five to ten per cent per annum. Having all this money riding on a PC manufacturer would be a problem, according to Forrester (see Forrester predicts terminal slump for PCs), but it was just last week that Lou was saying the PC era was coming to a close, so that's OK. ® Click for more stories Click for story index
The Register breaking news

Oracle strikes deal to push Linux apps in Japan

Oracle has forged an alliance with Pacific HiTech (PHT), aiming at driving Oracle Linux applications into Asian markets. PHT claims a large installed corporate Linux base in Asia, and over 50 per cent of the Japanese Linux market. The alliance intends to develop enterprise-class applications for Linux, and in addition to helping Oracle build its Linux presence in Asia on the back of PHT's secure e-business portfolio, is seen by PHT as helping it develop in the other direction. "Our customers in the US and Asia will reap the performance, scalability and flexibility benefits of Oracle8 and Oracle Applications on the TurboLinux operating system," said Cliff Miller, PHT CEO. "Partnering with the world's leading provider of database solutions is key to our strategy in entering the US market and is a big step in keeping our promise to offer corporate customers the most robust Linux operating system on the market." The two companies will provide links between their Web sites and engage in joint promotional activities, and joint support of Linux development efforts. ® Click for more stories Click for story index
The Register breaking news

Netscape moves into Web-based enterprise app services

Netscape has moved into Web-based enterprise application services with the announcement of two products for Peoplesoft, Netscape Application Server for Peoplesoft and PerLDAP for Peoplesoft. The products are intended to integrate Internet applications with ERP systems, and will allow Peoplesoft customers to extend their Peoplesoft systems across the Internet to reach customers and business partners. Netscape's move will go some way to strengthen its hand in the nascent, ASP (Application Services Provider) business, which is already being promoted by Oracle via Oracle Business Online. Netscape does, however, seem to be taking a more conservative route than Oracle, for the moment. Oracle sees Business Online offering an application rental system, giving smaller companies access to enterprise applications, whereas although Netscape and Peoplesoft may also in effect be doing this, they're taking an extranet-business partner route, building on logical development in communications between large businesses and their partners and customers. Application Server for Peoplesoft is due to ship in the first half of next year, at $70,000 per CPU. ® Click for more stories Click for story index
The Register breaking news

Synopsys to create VC chip fund

The Wall Street Journal reported that Californian company Synopsys will announce it is creating a VC fund for system on a chip designers. Synopsys, which makes tools for chips designs, will put $20 million into the fund. The money will be used to fund start-ups which do not compete with its own business. It already has made investments in other chip companies including Nvidia, Gambit, and Artisan Components. ® Click here for stories
A staffer, 30 1998
The Register breaking news

MS strives to prove potential AOL, Netscape pact anti-competitive

The cross-examination and rebuttal of AOL VP David Colburn continued all day, with John Warden, Microsoft's trial attorney, trying to establish that from late-1995, Netscape and AOL were discussing the possibility of AOL taking Navigator, with provisions to avoid competition. It would be illegal for a monopolist to have such discussions, but not probably for AOL and Netscape as the point of the collaboration was to was to compete against Microsoft. In the event the discussions did not result in an agreement, because AOL was wooed by Microsoft. Warden tried to make something of AOL's desire to run Netscape's Web site in early 1996, which was an alternative to AOL having a seat on Netscape's board. At the time, AOL feared both Microsoft and Netscape, the former because of MSN, the latter because Navigator presented a non-proprietary world to AOL subscribers. Colburn explained to Warden that AOL was trying to establish a strategic relationship and united front against Microsoft. Warden tried to make the case that AOL customers had a choice of browsers, but Colburn said it was non-trivial for users to work out how to do this. Colburn's testimony gives considerable detail as to how further agreements with Microsoft limited AOL's ability to help its customers who wanted an alternative. The line of questioning did little to progress the case, but Judge Jackson did not intervene. It seemed as though Warden had been told to spin things out so that Ball Gates' video testimony would not be run excessively over the Halloween weekend. David Boies, the DoJ's trial lawyer, was asked afterwards if Microsoft was filibustering, but he declined to comment in view of his nearness to Capitol Hill, he said, where legislation is often talked out by over-long speeches. Warden continued to press the Microsoft view that it "won" AOL because it had a superior product in Internet Explorer, but the evidence that AOL's presence with Windows 9x was highly important for AOL is very convincing. A lighter moment arose when email messages between Case and Netscape CEO Jim Barksdale revealed some role playing. Microsoft was "Hitler", Case was "Franklin D" and Barksdale was initially "Stalin", but after complaining that his character was not very politically correct, he became instead "Winston C". A letter from Case to Barksdale suggested pooling technologies, since Netscape was "primarily in the enterprise software business", and AOL was primarily in the consumer online business. Warden did not manage to make a convincing case that non-consummated agreements by non-competing partners were a potential problem in competition law. Boies claimed that there could be no antitrust violation because AOL operated principally in the online service business and Netscape in the server software business. The concern is growing that even if the DoJ wins the case, any remedy in the client space will probably be inadequate in the server space. ® Click for Register trial coverage Click for more stories Click for story index
The Register breaking news

SPC contemplates its future

It looks like Software Publishing Corp is putting Harvard Graphics up for sale. Following its run-in with NASDAQ, the Fairfield New Jersey company has hired Southeast Research Partners Inc (SERP) to provide investment-banking services. The conventional preamble to disposals. Software Publishing's president and CEO, Mark Leininger said only that: "SERP will pursue and evaluate traditional financing alternatives as well as alternative capital structures." Software Publishing was told last week that it can continue its NASDAQ listing, subject to certain conditions. It must file a report with the US Securities and Exchange Commission by December 15 showing net tangible assets, "no less than $3.5 million as of October 31… adjusted on a pro forma basis for any significant events or transactions". The company acknowledged that it needs to generate additional equity financing since it had only $2,970,128 of net tangible assets as of June 30, 1998. Another condition is a minimum $1 bid price for common stock by January 21, 1999, and a closing bid price of $1 or more for a minimum of ten consecutive trading days. Leininger said: "We are grateful that NASDAQ provided the opportunity to present our immediate and long-term growth plan and strategic objectives and… has decided to continue the listing… while allowing time to aggressively pursue profitable operations, equity financing and greater exposure in the investment community." Robert Gordon resigned as vice president of marketing and sales. ®
The Register breaking news

Action tipped by Investors Chronicle

Action Computer Supplies is being tipped as good value by the Investors Chronicle. Action said that there's no clear trend in its computer distribution business and some customers are cutting back while others are expanding. Margins are stable at 14 per cent, despite this year's roller coaster of IT pricing. Action grew its customer base by acquiring resellers SHL Technology Solutions and Fraser Associates, and the subsequent reorganisation entailed a £1 million hit, which was sufficiently well-flagged, the Chronicle said. Gearing levels deteriorated with the goodwill write-off but Warburg Dillon rates the shares positively at 11 times prospective earnings. ®
The Register breaking news

All I want for Christmas is my cheap PC

HP's Lew Platt told analysts yesterday that PC pricing pressures are easing, but he's cutting an isolated figure as the rest of the industry readies for the usual round of pre-Comdex, pre-Christmas price cuts. IBM's leading the pack with its new £350 ($599) Aptiva E Series system, the D1N, available during November. "It's the perfect system for families ready to give the kids their own PC," said Brian Connors, vice president IBM Aptiva. The 300MHz MMX-Enhanced processor comes with 32MB to 256MB DRAM, a 3.2GB hard drive, 56Kbps modem and the Lotus SmartSuite of applications. Dell was next, announcing price cuts of up to 13 per cent on the Dimensions range for consumers and small businesses. The biggest discounts apply to the higher-end systems, the XPS series with 400MHz and 450MHz Pentium IIs, DVD and high capacity drives. Dell attributed the price cuts to lower component costs and according to Paul Bell, senior vice president of the home and small business group. "Our direct model enables us to keep low component inventories that enable us to give immediate savings when component prices are reduced," he said. Compaq and the rest are expected to follow suite in the coming weeks. ® Click for more stories Click for story index
The Register breaking news

Schlumberger, Samsung form alliance

Samsung Electronics has struck a deal with German company Schlumberger in a bid to capitalise on lucrative Chinese markets. According to reports, Samsung and Schlumberger will cooperate on producing both chip testing equipment and IC cards. As part of the deal, the German partner will open a research office at Samsung's fabs in South Korea. But the alliance is a wide ranging one. Both companies are also cooperating on integrated chips on motherboards. No financial details of the arrangement were disclosed. ®
The Register breaking news

Videologic slammed by Sega

UK graphics specialist Videologic has found itself at the centre of a spat between games console developer Sega and chip manufacturer NEC. Sega recently admitted it won't, after all, be able to ship one million of its new Windows CE-based DreamCast console by the end of the year, a prediction it made a little over a month ago. Sega blames NEC for the delay. The NEC connection arises because it's manufacturing the silicon that brings Videologic's PowerVR 2 technology to the DreamCast. According to the company, what has held it back is the "stringent" quality control checks its claims it's having to make on the NEC/Videologic graphics chips". Sega is now saying it will have shipped one million DreamCasts -- the general figure that's used to inficate widespread public acceptance of a games machine -- by next Spring. The console will be launched, in Japan, next month. For its part, Videologic is saying it has delivered everything that Sega demanded of it. That's a fair point -- the problem ultimately lies with Sega. Having been beaten badly by Sony, whose PlayStation snatched the market from Sega and Nintendo, once the only two serious players in the games console business (we said 'serious', 3DO fans). Of the two, Sega has had the worse time -- Nintendo took Sony's advent on the chin and quickly developed the superior Nintendo 64 console. Nintendo has at long last started to build up a major market share for the N64, but that just makes it harder for DreamCast to show it can offer something that neither the PlayStation, with its vast array of software, nor the N64, with its superior hardware technology, can offer. With so much to play for, it's no wonder Sega leaps on things like the 100,000 pre-orders Japanese retailers took in the first 48 hours of offering reservations on new machines. Sources suggest its factors like these that are now pushing an increasingly -- and, perhaps, understandably -- panicy Sega to expect more from its component suppliers than it originally contracted them for. Hence Videologic's comment on the matter. ® Click for more stories Click for story index
The Register breaking news

Dark night for Ionica as no white knight tips up

Deeply-troubled Ionica failed to find a white knight and it called in the administrators yesterday. The radio-based telecommunications company said that normal services will continue for its 62,000 customers and since the parent Ionica Group is unaffected by the collapse, shareholders may see some recompense, unlike Ionica’s 1200 staff. Ionica has been looking for an investor since May and until last weekend, the Scottish company, Atlantic Telecom, was being touted as the most likely candidate. Ionica’s 15 months as a public company were characterised by volatile trading, with share prices soaring and plummeting between 421p and 8.75p. Fixed assets are valued at £250 million and it has around £40 million in cash but it owes £225 million to bondholders. Technological and financial issues have dogged the company, not least network under-capacity, and the banks’ recent decision to withhold a £300 million facility. Warburg Dillon Read advises the company and the joint administrators are Ernst & Young and PricewaterhouseCoopers. ® Click for more stories Click for story index
The Register breaking news

Doh! Homer Simpson sells out to Satanic Intel

The Great Satan of Chips has lured Homer Simpson into one of its secret skunk operations and will "upgrade" his brain, the company said today. Simpson, who has in the past criticised both Intel and Microsoft, is to receive the ultimate insult to his IQ. This is all very intriguing. At the Intel Developer Forum some weeks ago, which The Register attended, a very senior Intel architect said that even given Moore's Law, Intel chips will not be able to deliver the power of the brain of a bumble-bee by the year 2012. According to Satanic sources, an advertisement which Intel will run on 8 November will show a perfectly good brain destroyed by corrupt surgeons. They will replace Homer's brain with a Pentium II complete with waffles and baffles. There are different kinds of intelligence, and the boffins at Intel are assuming in their advert that Homer is stupid. Simpsons creator Matt Groening said he was now several million dollars richer. Anyone who criticises both Intel and Microsoft cannot be that dumb. ® Click for more stories Click for story index
The Register breaking news

Fujitsu dumps Singapore

The island of Singapore has received another blow to its IT fortunes. Reports in Newsbytes said that Fujitsu will sell out its local DRAM assembly line operation to a Singapore firm, United Test and Assembly. No financial terms were disclosed. The move is part of Fujitsu's overall restructuring worldwide. ®
A staffer, 30 1998
The Register breaking news

Dixons and Cyrix team up – predictably

As revealed here three days ago and as "exclusively" revealed by ZDNet the day after, Dixons has bought into the Cyrix chip concept. Patriot machines will use Cyrix MII-300 chips and be sold from the groups 800 PC World, Currys and Dixons shops to capitalise on the pre-Christmas rush for technology. The Patriot machines will include 512K cache, 32Mb of memory, a 2.1Gb hard drive, 14-inch monitor, a 32-speed CD ROM, and Win98. Systems will cost £599 and like the Comet deal revealed by The Register at the beginning of this week, other options will be offered. ® Click here for more stories
The Register breaking news

GE Cap takes stake in ITG

GE Capital Equity Capital Group Europe has taken a five per cent stake in ITG, the UK’s largest independent Internet Service Provider, generating some £1.77 million. ITG issued new shares at 85 pence per share in cash, and they will be traded on the Alternative Investment Market (AIM). ITG’s chief executive, Laurence Blackall commented on the new investment, saying, “the new funding will enable us to further realise our development plans and ambitions to become a truly European operator” More specifically, ITG said that the proceeds will be used to develop its’ network and ramp up activities in the European business connectivity and communications marketplace. Equity Capital Group Europe, part of GE Capital, a wholly-owned subsidiary of General Electric Company, invests around $1 billion a year. ® Click here for more stories
The Register breaking news

Intel to extend leasing service to SMEs

Intel Financial Services is offering a range of new leasing options through its 1500 Intel Product Integrators (IPIs), targeting small and medium businesses with deals starting at £450. There is no maximum spend limit and applications for finance up to £20,000 can be approved within ten minutes, according to John Longergan, Intel EMEA’s marketing manager. He said that many small and medium resellers don’t have easy access to competitive financing and the new programme simplifies the process by providing a one-stop shop. "IPIs will benefit from ease of access. Instead of negotiating separate lease finance, they can come to us for the finance, products, training and support. With online quotes, they’ll benefit from very fast turnaround." Mark Davison, marketing manager with Datrontech, believes that the lease options will prove popular with IPIs. "When a customer signs a lease, the finance company pays the integrator very quickly and the customer gets cheaper kit. It mean a fast turnaround of systems and cash," said Davison. Intel is offering both finance and residual value leases, and for a cost, users can upgrade systems during the lease term and write off residuals against new leases or purchases. Any kit returned reverts to Intel Financial Services, and Longergan said that some systems and components will be recycled while others will be channelled through Intel’s environmental disposal programmes, donated to charity and educational establishments. Intel has teamed up with Dana Commercial Credit (DCC), a wholly-owned subsidiary of Dana Corp, to provide the financing. Jon Singleton, DCC’s UK sales director said that leasing enables businesses to fit computing into tight budgets. “It helps protect against obsolescence, it provides the ability to upgrade equipment [and] maintaining a predictable payment schedule is a major benefit.” The Financial Services programme will cover a range of hardware, software and services, including non-Intel kit, but all desktops, workstations and mobiles must be based on Intel processors. ® Click for more stories Click for story index
The Register breaking news

Datrontech: Buy! Buy! Buy! Sell! Sell! Sell

A while back, Datrontech shares were slumping and slumping, to such an extent that we wrote a story saying more or less the same as the above. Its shares recovered and we had a grateful letter from a reader who said that he'd made a cosy little sum thanks to yours truly... Well, now's the time to consider buying again. Shares have fallen to 40p and that, in our view, means that it is considerably undervalued. ® Click for more stories Click for story index