11th > December > 1998 Archive

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MS research chief holds court in London

"The second most famous person in Microsoft" was introduced to an audience in London yesterday afternoon by the Editor of the Economist. But it wasn’t Steve Ballmer (nor Bob Herbold, who fancies himself as number three). The number two famous person is Nathan Myhrvold, Microsoft's chief technology officer. And Myhrvold certainly has some claim to this status. But despite his being the guy who runs Microsoft’s research operations, Microsoft’s reputation for the introduction of (genuinely) innovative products remains dismal. Myhrvold was in London to talk about the future of software, and to this end he romped through his version of the history of computing, attributing modern computing to Von Neumann, although he was forced to retract this in response to a questioner who mentioned Alan Turing. Myhrvold introduced a number of laws modestly named after himself, all concerned with the theme that software expands to equal or exceed the size of the container. This explains a lot. Microsoft likes code to be big: it forces users to buy new computers, and hence more Windows, more quickly. Myhrvold was proud that NT code was increasing in size by 34 per cent/year, about the same rate of increase for the number of bytes per dollar of DRAM, it turned out. In his potted history of software milestones, he mentioned Java, although it seemed to have dropped off his slide. So far as what Microsoft was doing in the research area, Myhrvold had very little to say. There is no flagship product that was conceived in Microsoft's research department that has become a Microsoft product (although judging by the intellectual level of his accompanying video, perhaps the now defunct Bob or the talking paper clip came from his stable). Myhrvold claimed that "every major Microsoft product from Windows 3.0 on has technology in it from [Microsoft] research" but he was not giving many examples. He mentioned speech synthesis and speech recognition, but these do not seem to have appeared yet in a Microsoft product, although they are ten-year-old technologies. There are 350 people in Microsoft research in Redmond, San Francisco, Cambridge and Peking. It seems that the research group is still slaving away trying to produce a wallet PC, but nobody seems to have thought of buying Bill a Psion to satisfy his craving. Myhrvold fell back on a shaggy dog story, which seemed to be true: "The sheepdog can take commands from a very large set; it can do physics, applications, intelligent problem solving, it can learn and be trained – all aspects of intelligence. In each case the sheepdog does a vastly better job than today's computers. From a commercial perspective, if Microsoft were as smart as a sheepdog, we'd sell a hell of a lot more." Woof, woof. ®
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Apple ‘WebMate’ portable to follow iMac

Apple's next portable will be a sub-$1,500 bracket machine with iMac styling and sold under the name WebMate, according to US reports. The machine, which is due out early next year, will weigh around four pounds, have iMac-style translucent casing and a 300 MHz PowerPC processor. It will also follow the iMac (and Steve Jobs' personal prejudices) by using USB for peripheral connections and having a built-in Ethernet adapter. But although creating a big bang in the mobile computing arena is vitally important to Apple's come-back, the company isn't expected to show it at MacWorld next month. There Apple is more likely to be concentrating on the next rev of the G3 desktop line, product that was virtually ready to roll when Jobs took over, and which he milked mercilessly with the "Pentium Toaster" tag-line. There's little question that Apple could go with a new portable now if it wanted to, but although the company is now widely thought of as being 'cured,' its position is still precarious. It has had a couple of successful products, but it's in the difficult position of having to make every one of its next few launches a big hit. It needs to bounce back in the mobile business, to produce a credible product in the Newton/eMate replacement bracket (see Apple and Palm alliance emerges), and to reinforce its iMac-based consumer market presence. And it needs to do this with relatively limited resources. So expect carefully scheduled rollouts, each one accompanied by massive amounts of hype -- some of it maybe even justified. ®
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Is MS Java better than Sun version? Judge queries Gosling

Judge Thomas Penfield Jackson yesterday showed signs that he might be prepared to buy Microsoft's claim that it was improving Java, rather than simply mounting a cynical campaign to destroy it. It's actually doubtful that the good judge will accept the whole story, given that Microsoft documentation (produced at the Sun-Microsoft trial (Microsoft sought to pollute Java)) clearly indicates a plan to grow a "polluted" Java, but it looks like he might be zeroing in on one of Sun's big problems with early versions of Java. It was bigger and slower than anticipated, and this caused real problems for companies who'd intended to be early adopters, particularly for low-resource platforms. Microsoft's pitch is that its implementation is faster and better than Sun's and with the introduction of the new injunction-compliant version (Microsoft 'compliant' Java tempts Sun to sue some more), it claims it's got even better. You don't need to believe absolutely everything Microsoft says in order to accept that there's a certain amount of truth in this. And there's also quite a lot of truth in Microsoft's claims that Sun is big on promises and short on delivery (but it takes one to know one). Judge Jackson suggested to Java inventor James Gosling: "Didn't what Microsoft do was grasp the significance of the work you were doing, and then run with it and produce a better version of it? They simply couldn't wait for you to catch up." Gosling responded that Microsoft's version was tied to Windows, but that wasn't an entirely adequate answer to the question. Being able to show that Microsoft did intend to fragment Java in order to preserve its own dominance is important to the prosecution, but if Microsoft can successfully suggest that Sun's 'standard' Java gives consumers a worse deal than Microsoft's Windows-ised one, the case blurs more than a little. ® Complete Register trial coverage
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A year ago: Disties hit again by VAT fraud scandal

If you talk to Alan Stanley, MD of the UK wing of French company Dane-Elec, he'll tell you, like many another poor soul in the memory distribution business, that times are tough and getting tougher. But while Stanley and his company compete in an ever more cutthroat business, the British authorities are not making it any easier, he feels. Members of the European Union operate different levels of value added tax (VAT), meaning that if you're a crook, you can shuffle SIMMs around the place and make extra margin points, all the time undercutting the legit distributors of the products. But while the problems been known about for quite some time, the UK authorities, Her Majesty's Custom & Excise, don't seem at all exercised about the problem in the slightest. Last year, the French VAT police, on the other hand, took a remorseless approach to the problem there, nicked a number of companies implicated in the fraud and even shut several of them down. The Register phoned the press office at Customs a couple of weeks before Christmas and asked the department what it was doing about the UK dimension to the problem. "We'll get back to you," came the reply. Another call, a week later, produced the interesting information that it wasn't a Customs problem and the press office had shunted the enquiry off to the National Investigation Service. Well, we weren't even aware that UK Customs had spun a part of itself off but in any event we didn't hear from them either. So while the investigators seem more concerned that cheap beer is flowing into the South of England (the tax on booze and ciggies is far less in France) and destroying our public houses, it seems that legit businesses stand the risk of going under while the huge VAT fraud goes unrecognised. Stanley pointed out to The Register that this type of fraud does not just apply to memories - there's all sorts of other goods on which tax is being evaded. While his customers - the dealers and resellers of this world - can hardly be blamed if they're offered even cheaper DRAM in their bid to make an extra few points, the UK authorities seem to be standing at the sidelines, wringing their hands and losing out on what they should be concentrating on - gathering revenues. ®
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Email hits the high street

BT is to open 2,500 multimedia phone booths up and down the country in March, enabling everyone to surf the Web and collect and send email over the Internet. Each booth is to be fitted with a 10-inch screen which combines a built-in touch sensitive keyboard. Using a browser -- no-one knows which one just yet -- anyone will be able to access the Web. Email services will be available via BT’s Talk 21 free email service. The cost of the service is likely to be in line with the company's other pay-as-you go service BT Click, which is set at 1p above the local tariff rate. A BT representative said he thought this was the first time a service of this kind had been put to commercial use anywhere in the world. "This initiative opens up a whole new world," he said. "There are millions of people out there who don't have the opportunity to access the Internet. This service should remedy that situation. "It could even drive the growth of the PC market, in much the same way as public telephone boxes prompted the adoption of telephones in the home," he claimed. No firm decision been made about which browser will be used -- or whether Web access will be ring-fenced to create a safe haven of suitable material, the spokesman said. With less than four months to go before the booths become operational, BT acknowledges there is still much work to be done. And although the hardware and network infrastructure has been tested, the booths themselves are currently being knocked about with sledgehammers and covered in spray paint to test their resistance to vandalism by a crack BT environmental team. Which means that there are no pictures available of the booths – unless you want to see them lying in a smashed heap on the floor that is.®
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NatSemi makes loss and IBM didn't help

National Semiconductor made a net loss of $48.6 million on revenues of $510.1 million for Q2 of its 1999 financial year but said that it was encouraged by some buoyancy in the market. In the equivalent period last year, it made a net profit of $28.9 million on turnover of $719.9 million. In the period, it had to pay IBM nearly $50 million to terminate its Cyrix foundry agreement, as exclusively revealed here which had a big effect on the results. Brian Halla, CEO of NatSemi, said that its Cyrix division did better than expected and has contributed towards the company's return to profitability. In the quarter, NatSemi moved its Cyrix chip fabrication from Big Blue to its own .25 micron manufacturing plant, and Halla said that the removal of the IBM competition, as well as better acceptance of its processor as an alternative to Intel parts, had improved opportunities in the market. Halla said that its market share of the sub-$1,000 market had risen from 7.7 per cent to 12.9 per cent, according to figures from Mercury Research. And, also revealed here earlier, Cyrix has captured a third of the retail sales for desktop chips in the sub-$800 segment in the US. Those movements are at the expense of Intel. Quarterly orders improved by 12 per cent over its first financial quarter of 1999, with bookings equalling billings. "While we enjoyed the recent strength in new orders, we remain cautious concerning holiday impacts on our traditional businesses during the third quarter," Halla aaid. "Increasing design wins of our Cyrix processors may, however, provide an offset to this traditional seasonal weakness." ® Intel, AMD and Cyrix are not investors in The Register
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Good times ahead for DVD

According to research undertaken by the media journal, Screen Digest, more than one million DVD players will be in use across Europe by the end of the year 2000. The magazine estimates that some 125,000 DVD players have already found good homes to go to this Christmas, with that number expected to rise to around 485,000 this time next year. The main driver for this growth in demand will be the DVD discs - the big names of the music and film industries will have to throw their weight behind the format and release the right titles. The report, DVD Video: European market assessment and forecast 1998-2000, predicts that 1.4 million DVD discs will be sold across Europe by the end of this year -- a figure which will grow rapidly to around 15 million in 2000. In time for this Christmas, some 135 DVD movies and music videos are available in the shops. This number is expected to hit the 400 mark almost immediately though. But despite this increase in demand, DVD is still in its infancy, the report says. Looking at the number of titles on release, the report points to the US market where over 2000 music and film DVD are available. Public perception is also a potential stumbling block, it claims. Only two per cent of European adult males know what DVD is, the report says -- in the US this figure stands at 44 per cent. France has become Europe's early adopter of all things DVD, with Germany in second place and the UK in third. ®
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IBM puts big boot in own NC mouth

Earlier this year, The Register scored what we thought was a massive scoop when we reported that IBM had won a huge deal to sell 50,000 of its NCs to courier company Fedex. (Story: Huge IBM NC deal close to fruition). As CeBIT approached, we wondered what had happened to our scoop. Had we made a mistake, and got the whole thing wrong? We thought not, because our source was as impeccable as any senior IBMer could be (they’re all a bit peckable, really). Now the truth has emerged and it is deliciously, deliciously funny. IBM did indeed clinch a deal with Fedex to sell them 70,000 NCs, not 50,000 as we reported. The deal was in the bag and was the biggest win Big Blue had ever made on its ill-fated NC platform. But Fedex told them to get lost soon after hands were shaken because a decision was taken at a senior corporate level to move from Fedex, as its own courier, to UPS. Gasp…. ®
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Intel slashes Slot One Celeron prices… again

Intel cut the cost of Slot One Celeron’s last Sunday to $97 for the 333MHz part with 128K cache and $80 for the 300A in a bid to move the market fast to the 370-pin part it will announce in January. Before last weekend, these parts cost $159 and $138 respectively, when bought in large quantities. But the chip giant is still denying that it is dumping Celerons onto the market, despite yesterday’s claims from a senior Cyrix Europe executive. Earlier this week, motherboard manufacturers also complained, this time about a lack of 370-pin chips. Some observers, however, see the move as a cynical way of both coping with the shortage of 350MHz PIIs and at the same time moving its Slot One offering out of the way. Intel will also ship more Slot One Celerons this month and next because of its decision to move 300MHz and 266MHz PIIs out of the picture, as previously revealed here. Mark Davison, processor product manager at Intel distributor Datrontech, said: “We’re shipping loads of Slot One Celerons and that’s been accelerated by the price cuts earlier this week.” He said: “A lot of people are still feeling pain from the shortage of the PII/350 and have bought the 333MHz Celeron rather than moving up to the faster processors.” Davison said: “The timing [of the price cuts] is strategic as the parts go through the channel”. He claimed that while his company has 370-pin parts already in stock, there are very few motherboards that currently support them. “I’m not swinging for the chandelier on the 370-pin part yet,” he said. Davison said that Taiwanese motherboard manufacturers “are traditional fence sitters” when it comes to implementing new platforms. He claimed that Intel's price movements on the Slot One Celerons only held good until the end of December. ®
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When Harry met Scally, kinda

When Harry Thuillier sold his reseller business, Fraser Associates, to Action Computer Supplies last year he dropped out of view altogether. He had been one of those oft quoted sorts that crops up rather a lot in the weekly channel press, and he was greatly missed by hacks in need of a sound-bite. Well, now he has been linked - in a roundabout sort of a way - to Oasis frontman Liam Gallagher. Last month, Manchester’s premier wildman of rock was again in trouble with the law. This time he attacked Mel Bouzard, a photographer, outside the Pembroke Castle pub in London’s Primrose Hill. Allegedly. The snapper is now suing DJ Chris Evans for remarks made about him over the air following the disturbance. Allegedly. And the link with our man Thuillier? After selling up and leaving the channel behind him, he became part owner of a number of entertainment establishments, including a restaurant and some pubs. One of which is the Pembroke Castle, Wildman Gallagher’s favourite watering hole. So, with all those rock star’s drinking and fighting in his pub, how’s Thuiller adjusting to the world of pumped up egos and attitude problems? After running a reseller business he’s unlikely to have noticed much of a difference. We at The Register would like to run a regular series of Where Are They Now columns and we need your help. Please drop us a line if you have any information on the whereabouts of the following, all of whom have fallen off our radar screens recently. Lord Lucan, Shergar, AST, the IBM NC….®
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10,000 jobs to go after Ericsson profit warning

A profit warning plus up to 10,000 projected job cuts from Swedish giant Ericsson yesterday provided ample evidence that the company's expansion plans are miscarrying. Earlier this year Ericsson came under fire for its climbing marketing expenses, and now it appears these aren't being translated into sales. Ericsson CEO Sven-Christer Nilsson yesterday blamed "the financial crisis in certain markets" as triggering the need for rationalisation, and although he didn't say where the job cuts would take place, it seems inevitable that the Swedish home territory will be hit hardest. The corporate stand-fast of the last 12 months, 'uncertainty and poor sales because of the Asian crisis,' doesn't altogether wash in Ericsson's case. The company performed strongly in the US digital market last year, but recent Dataquest numbers put Nokia's share here for the first nine months of 1998 at 40.3 per cent, double second place Ericsson's 20.6 per cent. Basically, Nokia has got the marketing and product release schedule right in 1998, and is benefiting hugely as the US digital cellular market explodes. Ericsson has spent a lot of money on marketing, but hasn't got the products out at the right time. The problems of Motorola, which has seen the Vikings swipe its US customers with the switch to digital, must be small consolation to Ericsson. ®
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NEC to use Cyrix chip

Packard Bell said yesterday that it will use the Cyrix MediaGX chip in a consumer notebook called the NEC Ready 120LT. This is strange. Two days ago, Colwyn Munro, general manager of NEC Direct, said that his customers wanted Intel and not non-Intel chips. (See Red faces all round in PB-NEC Intel chip fiasco) According to spin doctors for the company, the NEC Ready 120LT is for the US market only and will not be sold in Europe. We will watch out for any sign of it making an appearance from beyond the pond so we can ask your man again… ® * Hong Kong company Kapok said it will use Cyrix chips in its range of notebook machines. It never said it wouldn’t, so that’s alright then.
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IBM, SGI in frame to buy Intergraph?

Predators are stalking workstation manufacturer Intergraph, according to industry sources, with both SGI and IBM tipped as possible buyers. If a deal with either went ahead, it could have interesting consequences both for Intergraph's legal tussle with Intel and for Intel's plans for the workstation market. The sources suggest that although SGI is in the frame, IBM is the most likely suitor to be successful. The fact that two names are in the field suggests that Intergraph itself wouldn't be entirely against takeover, and may indeed be seeking a purchaser. The company lost $25.5 million on sales of $253.6 million in its third quarter, blaming damage caused by anticompetitive action by Intel, but even without this Intergraph's position doesn't look entirely positive. The company is a minnow that did well by spotting the potential of Intel-based workstations, but has been under pressure since Intel started commoditising workstation design, and (Intergraph claims) witholding key technical data from the company. Intergraph currently has an injunction compelling Intel to co-operate with it, although Intel is challenging this, and earlier this year took steps to reinvent itself. Its manufacturing is being transferred to SCI, with Intergraph itself becoming a design operation. But perhaps the company also sees merger or acquisition as an alternative option. SGI might be a viable partner from the point of view of consolidation. The company is close to Intel, and has itself introduced a range of high-powered Intel workstations within the last few weeks. A deal with IBM on the other hand would indicate that Big Blue felt the need to beef up its own Intel workstation operations. At the moment Hewlett-Packard is ahead in Intel workstation sales, and with other manufacturers starting to challenge too, IBM might be in some danger of missing another boat. If a deal of some form did go ahead, it could be viewed as a bizarre Intel version of the Netscape-AOL deal. Intel is due to face an FTC antitrust action next year, and Intergraph is a key alleged victim. So if Intergraph cashed out... Either of the suggested suitors would probably drop Intergraph's lawsuit, although like the DoJ, the FTC would probably still go ahead. But don't even think Intel's pulling the strings - that's paranoia beyond 10 Groves on the Richter scale. ®
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Oracle bounces back with 46 per cent profit rise

Oracle has beaten financial expectations with the announcement of a stonking 46 per cent rise in quarterly profits, with strong computer services revenues helping it past expectations. Net income for Q2 (ended 3o November) jumped to $274 million from last year's disappointing $187 million. Turnover grew 27 per cent to $2.1 billion, ahead of Wall Street predictions, while database business jumped 25 per cent to $1.5 billion. After last year's results, analysts said the market for Oracle's flagship database software had "matured" and the world's second largest software company had lost focus. Oracle also became the first US high technology company to report problems in Asia, with investors turning white over the resultant 30 per cent share drop. Yesterday analysts were eating their words as Jeff Henley, Oracle's chief financial officer, proclaimed the market "still very attractive". He added: "We're delighted with our database performance in the Americas and Europe." He estimated a full recovery in Asia was still some years away, and noted limited growth in the area, saying: "At least Asia has done better than it has in the past five quarters". Analysts agreed Oracle had managed to resuscitate the database market. But they warned that the threat of Microsoft's SQL Server 7.0, designed to attack the low end of the database arena, still loomed. ®
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High noon for thieving B-*!&%*!&-S

News aggregation Web site NewsNow has hit out at rival site, 2b, accusing it of stealing headlines to aggregate on its own site. As of noon today, anyone trying to click on to a topical new story posted on 2b's site from The Register, for example, will instead get a message telling them that the story has been nicked from the NewsNow site. We don't think it will mention where NewsNow got it. The news aggregation service decided to put the boot in because it says 2b has been pilfering headlines and stories on the hour, every hour, for the last couple of months. Struan Bartlett, NewsNow's managing director, said he had tried to resolve the problem in a good-natured way, but his attempts to put a stop to 2b's unwholesome activities have come to nothing. "Enough is enough," Bartlett said. "We've spent time and money creating our software and database for NewsNow and then these guys come along, steal our stuff and then pass it off as their own. "Our stuff has been copied without permission so we've implemented a workaround to prevent this abuse of the NewsNow service," he added. No doubt we can expect some form of retaliation sometime this afternoon (see Crawly Cullen NewsNow story). ®
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Elonex sues Dell, P-Bell, Micron over monitor patents

Elonex is going for a lawsuit hat-trick, suing Dell, Packard Bell-NEC and Micron Electronics over the use of what it claims is its patented technology for reduced power-consumption in colour monitors. The British PC manufacturer filed the three lawsuits in the District Court in Wilmington, Delaware yesterday. It accused each vendor of infringing on patents issued in 1995 and 1997, covering the manufacture of PC monitor standby systems that reduce power in computers not in use. Elonex says it is being harmed by the unauthorised use of its technology, and wants the three companies stopped. It also asks for damages. The company is no stranger to patent disputes, and has rather more intellectual property than you'd expect of a company its size. In October Elonex filed a lawsuit in Munich to invalidate a Siemens European patent for power management technology. The company claimed it invented the technology first, and that it already licensed it to Hewlett Packard and Hitachi. ®
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Updated: LG Electronics to can seven foreign HQs

South Korean English language newspaper the Korea Herald has reported that LG Electronics is to shut down seven of its eight overseas business HQs. The division, part of massive chaebol LG, currently employs well over 30,000 employees, but it is not known how many jobs will go following the move. The division has offices in North and South America, Europe, the CIS, Japan and in other parts of the world. Sources close to LG Electronics in the UK said that it was likely an announcement will be made locally next week, with its Welsh and Slough offices affected by the move. The sources said that details in the Herald were not entirely accurate. According to the newspaper, its Chinese HQ will remain, while overall control for manufacturing and marketing will now report directly in to Seoul. LG Electronics will also leave the printer business, it said. ®
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BT to buy Spanish ISP, allegedly

A Spanish newspaper has reported that BT is to buy the Spanish Internet service provider Arrakis for an undisclosed sum. The financial daily newspaper, Cinco Dias, said an announcement is due at the beginning of January. But a spokesman for BT refused to shed any light on the proposed deal. "We do not comment on rumour or speculation," he said. He did confirm, however, that BT was very active in Europe and had a number of business interests in Spain, including the country's second largest data communications network. Arrakis has around 85,000 users and posted sales of one billion pesetas (£4.4 million) in 1997.®
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Big Blue smokes reefers?

At The Reg we're quite fond of www.companysleuth.com. It sends you emails which tell you, for example, what domain names large corporations have rented. Can it really be true that IBM has registered cannabis-sativa.com? Or obituarypage.com? Someone please tell us this is all a terrible mistake...
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Court slaps injunction in Umax

Umax has been forced to cease promoting its Astra 1220 scanner in the US as a 36-bit device, thanks to an injunction granted to rival scanner maker Visioneer. Visioneer's suit claimed that the 1220 is actually a 30-bit scanner with added interpolation software to approximate the higher image quality. The higher the number the of bits a scanner uses to create a digital image, the greater the number of colours the picture contains and thus the higher the quality. The injunction, granted by the US District Court for North Carolina, forbids Umax from selling the Astra 1220 until it changes the machine's packaging and advertising. It can continue to use the term '36-bit', but it must qualify it by stating the scanner's hardware is only capable of digitising at 30 bits. ®
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Survey: chips sales volatile throughout 1999

The recent levels of growth experienced by the worldwide semiconductor industry are unsustainable for "any length of time", market analyst IC Insights has warned. The company, which will next month publish the next edition of its annual McClean Report into the semiconductor business, reported thath the month-to-month sales growth of 4.3 per cent in September and 6.3 per cent in October cannot continue for much longer. On the basis of October's growth rate, 1999 would see an increase of 75 per cent over 1998's sales figures. The company said it expects sales to dip through December and early 1999. It also described the market through 1999 as one of short-term rises and falls. However, IC Insights said those peaks and troughs will average out as an upward curve. Semiconductor sales for the new year will be higher than those seen throughout 1998. The company anticipates the business will be worth some $140 billion, an increase of 11 per cent on 1998's $126 billion. ®
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Graeme Allan to leave Nortel-Bay, join Madge

The UK MD of Bay Networks, Graeme Allan, left the company last Thursday and is on gardening leave until he takes up his new position. According to sources close to his plans, Allan is to become the VP of worldwide sales and marketing at Madge Networks. Allan became MD of Bay after the merger of Wellfleet and Synoptics. It is not known when he starts his new job. ®
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Copyright cop out by Eurocrats

The Legal Affairs Committee of the European Parliament has delayed work on legislation crucial to protecting copyright because of what it is calling "procedural issues". The delay means that anyone who produces original material, such as authors, musicians and journalists, still has no rights over who can make copies of their work. This leaves the way open for piracy to continue unhindered on the Internet and elsewhere. If passed, the legislation would also give copyright holders a degree of control over how their material is broadcast or published. The vote has been rescheduled for January 20.®
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MCI WorldCom set to axe up to 4000 jobs

Around 3700 MCI WorldCom employees will be up for grabs to competitors, due to predicted layoffs following the merger. According to telecom and research analysts, WorldCom's $37 million acquisition of MCI will lead to expense cuts and the trimming of duplicate areas in the two companies. The most likely affected areas are network and line costs. WorldCom is also seen as a leaner company, with lower expenses than MCI. MCI WorldCom's CEO, Bernie Ebbers, promised there would be no layoffs as a result of the merger. But Eric Paulak, an analyst at Gartner Group, said Ebbers had trimmed the "fat" or overlap. "Those 4000 synergies Bernie Ebbers talked about -- they are people," he added. The job cuts come as no surprise -- they're part of the customary post-merger fallout. But the telecomms giant stated the review of the merged company was "still ongoing", suggesting further cuts may yet be announced. Those being given the boot may be snapped up by WorldCom's competitors, such as Qwest and Level 3 Communications, both of which are hiring. Paulak said: "Big companies are trimming down, but start-ups are building up." ®
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IE – app or OS? Microsoft case grinds to another weekend

Fruitless skirmishes between Professor David Farber of the University of Pennsylvania and Steven Holley for Microsoft continued for a second day yesterday, but gained no points for Microsoft. Farber said that Hadi Partovi, a Microsoft employee, had said in testimony that IE was an application. It turned out that Partovi had said that explorer.exe was an application, but Holley claimed that the executable "does nothing but call other files in Windows 98", but it still looked as though Partovi had made a Freudian slip. There was extensive questioning as to whether Microsoft had put several functions into one DLL in order to make it impossible to exclude a DLL from Windows 98 by ensuring it had a Windows 98 function as well as an IE function. Farber did not know enough to prove the point, but the suspicion lingered. Holley almost admitted that some large program elements might have multiple functionality when he criticised Netscape's "monolithic" navigator.exe, seeming to use again the argument that everybody does it, so therefore it's excusable for Microsoft to do it. This was a particularly weak remark by Holley, because there was no suggestion that Netscape had combined functionality for the same reasons that Microsoft might have done this. The proceedings wandered from analogy to analogy, but none was satisfactory. Holley brought up an AM/FM radio that had the button to switch between bands disabled, but it was unconvincing that what the DoJ was trying to achieve was to force Microsoft to disable IE in a similar way, and Holley failed to make this point anyway. Questions that he had asked the previous day were repeated to no avail. There were long periods when the cross-examination was more of a casual chat than a searching examination, with subjects like Heathkits, FCC regulations, and how Linux (and previously BSD) allowed Farber to explore with his students how the operating system would need to be modified for very high-speed communication. Holley's point eventually seemed to be that Microsoft would have to change its operating system in the near future (undefined) to accommodate all-optical networks. Holley had dug out a statement from Farber that existing operating systems designs would not work with high-speed networks, and that it would become necessary to have lean, mean operating systems - kernel operating systems - and to shorten the paths within them. It would also be necessary to get rid of redundant code that is not used. The result of all this was that Holley won the point that Microsoft would need to continue to develop Windows, but lost the point that bloatware would be tolerable in the future. Unfortunately Farber did not introduce into his replies - and the redirect examination missed it - the point that loading DLLs unnecessarily took a considerable amount of time when a PC is booted, or put into sleep mode in a notebook, quite apart from the RAM real estate that they occupy. Farber complained that when he tried to use Netscape with Windows 98, IE kept appearing. Holley quickly changed the subject. Nor did Holley like the refutation of his suggestion that any brilliant student could commercialise a great software idea: Farber noted that Andreessen "had Jim Clarke next to him with a large pot of money and a lot of intelligence". Holley tried to isolate Farber by suggesting he wanted Microsoft to be denied its copyrights in its products, and have them put in the public domain. Unfortunately Farber backed away from this eminently sensible suggestion and ran up a "I want to pick and choose" flag, with the code that was not chosen remaining in the library. Holley chose to misinterpret this several times, even after Judge Jackson had tried to terminate the silliness, to imply that Microsoft would have to test 1,000 or 10,000 versions of Windows 98, which was of course utterly absurd. Holley claimed that Microsoft had a code tester for every code writer, but Farber missed the opportunity to enquire why there were so many bugs in Microsoft software if this were really true. When Farber again mentioned that he had had to remove Netscape because IE kept popping up when he did not want it, Holley abruptly terminated his cross-examination. The redirect examination was in marked contrast to the earlier examination: it was conducted by Denise de Mory and was precise and to the point. She scored an immediate goal when it was revealed that one of Microsoft's intended witnesses, Professor Michael Dertouzos of MIT, when asked if a browser was an application had testified that "Historically and today, it is the case that browsers are treated as applications." Needless to say, Microsoft announced a substitute. She went on to get a second goal when she produced the Microsoft Press computer dictionary, where IE was described as a web browser, and web browsers were defined as "a client application..." After Holley's efforts the previous day to find definitions of operating systems that suited Microsoft's case, de Mory asked Ferber if he agreed with the definition in Microsoft's computer dictionary. He did, and it destroyed Holley's previous efforts. So far as separating the OS from the browser was concerned, Farber said there were a lot of benefits. De Mory then turned to whether it was necessary for Farber to understand the details of Windows 98 to reach his views: of course it didn't. A further clincher was Farber's opinion that Microsoft could have designed Windows 98 so that IE was separate, but users would have the same benefits. Farber also noted that a choice of browser would allow OEMs to differentiate their offerings more readily. De Mory concluded with another extract from Partovi's evidence, which pointed out that in IE5, Microsoft was moving around functionality from DLL to DLL, so demonstrating the flexibility of packaging available to Microsoft. It seemed that the DoJ won this round on points. ® Complete Register trial coverage
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Palm founders drop hints about Handspring handheld

Handspring, the company set up this year by Palm Computing founders Donna Dubinsky and Jeff Hawkins, is working on an education-oriented handheld computer. According to a report in USA Today, while not making an specific comments about what products they're working on, did become intensely enthusiastic when the conversation turned to Palm-based kit for kids. "What if you had a handheld device that costed $100?" said Hawkins. "You could imagine every kid having one. They'd be like GameBoys, only better." "It's an area we're interested in at Handspring [hardly the kind of name you'd give to a purveyor of serious business machines, we'd hazard a guess] and an area we are personally interested in," he added. Handspring was formed in the summer under the name JD Technologies -- the namechange became official last month. The company admitted quite early on that it was focusing on a consumer handheld based on the PalmOS, but Hawkins' comments this week are the first indication of what sector of the consumer space the company might be targetting. Interestingly, it's the same arena that Apple has its eye on for its forthcoming consumer portable, codenamed P1 (see Apple 'WebMate' portable to follow iMac), which interim CEO Steve Jobs this week described as an education-oriented machine that the company hopes will also appeal to consumers. Given the apparent close ties to Apple and Palm (see Apple and Palm alliance emerges), the similarity between P1, Palm's recently announced Palm VII machine and Handspring's approach all begin to appear more significant. It's not too hard to picture Apple discussing buying Palm Computing from 3Com, and Dubinsky and Hawkins not too keen on the idea -- particularly given Apple's poor handling of its own education-oriented notebook, the eMate 300 -- deciding to bail out and go their own way and push into the consumer arena, a market that neither 3Com nor (at that time, anyway) Apple seems too interested in. ®
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Mandelson to re-target DTI handouts on e-commerce ventures

Trade and Industry secretary Peter Mandelson is to reshape the Department of Trade and Industry's $1 billion budget to provide better support for e-commerce, it has emerged. Changes due to be revealed in next Wednesday's white paper on competitiveness will redirect funds to promote the Internet and "modernise the micro-economy". Mandelson's new industrial strategy encourages companies to upgrade their businesses using "knowledge-based" ideas. The cash jiggle may be at the expense of relocation projects for big businesses, an area the department now spends £100-£200 million a year. A DTI representative refused to reveal how the e-commerce ideas would be implemented, but said the government aimed to make the UK the best country to do e-businesses in by 2002. He admitted there was a long way to go, saying: "In some areas we do lag behind other countries. But this whole initiative isn't just about pumping money into training programmes, it includes getting kids in schools more clued up about computers." ®
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Watchdog snaps at BT's heels

Oftel, the UK telecoms regulator, is to investigate the take-up of high speed Internet access, video-on-demand and videophones among the great British public. Launching its latest consultation process, the watchdog organisation said it wants to discover if there is a latent demand for such services and, if so, whether there are any obstacles to those services being launched. It will, almost certainly, come to the conclusion that yes, there is a demand for the technology, and yes, there are obstacles. Of course, British Telecom wouldn't like to be thought of as an obstacle (after all, who would), but it appears this latest round of consultation is a thinly veiled attempt at pre-empting any monopoly situation the telecoms giant might find itself in the near future. Oftel's director general, David Edmonds, fired a shot across BT's bows. "If we identify any obstacles to the delivery of these services we shall consider regulatory action to remove them," he said. "I believe that competition is the best way to satisfy consumer needs and so I am concerned with barriers to effective competition." A tactful spokesman for BT said that the announcement raised a number of complex questions about the industry and that BT would consider its position, and respond, in due course. ®
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Survey: SMEG explosion to benefit channel

A report from IDC said that additional spending by the small and medium enterprises groupings (SMEGs) in the UK is set to benefit the services sector of the channel. The market research demonstrated that Compaq, MS and IBM are considered the most strategic partners for service channel companies, but according to Marianne Kolding, research manager for IDC UK, that should be seen as a warning to other vendors. Research IDC undertook showed that only 50 per cent of respondents were reselling vendors’ packaged services and preferred to sell their own portfolios to SMEG customers. Service Partnering Opportunities in the UK IDC is at 44 +181 987 7100. ®
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Update: MCI WorldCom sacks 2000 staff

MCI WorldCom today confirmed it will slash 2000 jobs by the end of the year, following four months of speculation since the company's formation. Jamie DePeau, a company representative, confirmed: "We will be notifying approximately 2000 employees today that their jobs will be eliminated by the end of the year." The cuts will be in numerous locations, but Richardson, Texas, will suffer most -- where about 300 people will be given the boot. DePeau said the cuts were "a result of a long and detailed review of the combined WorldCom and MCI operations". Those laid off will be paid to the end of the year and receive severance pay based on length of service. The cuts were expected by analysts, who had questioned WorldCom CEO Bernie Ebbers' promise that no layoffs would result from the merger. ®
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News wars 2 – the swiper swipt?

The great news aggregration thieving war appears to be over. Allegedly. The MD of 2b -- which was accused of swiping news and headlines from the aggregation service NewsNow -- has apologised publicly for doing it, claiming that he didn't even know it was happening. Seventeen-year-old Tim Dunton -- who makes several references in his publicity material to the fact that he was once described as Britain's answer to Bill Gates (Isn't that 'Sod off, you pathetic yank geek'? - Ed) -- said he will contact NewsNow either today or over the weekend to make a full apology. "I didn't even know our software was scouring the site and taking the stuff," said a contrite but still baffling Mr Dunton. "A freelancer wrote the software -- I didn't know any different until it was brought to my attention today." NewsNow sprung its trap at midday after claiming that 2b had been stealing its news collations for months. Anyone trying to access files at 2b's portal received at curt message saying where the news came from. Shortly afterwards 2b's news content seemed to have switched suddenly to alternative (and to be frank, rather sad) UK news provider silicon.com. Presumably Dunton wasn't entirely aware of this either. And in a bizarre twist late this afternoon Mr Dunton announced that he had struck a deal with another online news service, Newswatch, to supply 2b with news-ticker headlines and summaries of health, eco, defence, space, aviation and royal stories. "Newswatch is great because it fillets out all the boring stuff and gives our readers the news they're interested in," said Mr Dunton. "Editorial judgement is great, so all the stories they send us are a terrific read." As opposed to what he was running until noon today, presumably? ®