19th February 1999 Archive
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That Palm V picture in full...
A sneak preview of Palm Computing's forthcoming Palm V has appeared on the Web, courtesy of a certain 'Nigel' who claims to have seen the much-anticipated device over the weekend. The details are almost exclusively devoted to the Palm V's look and feel -- in particular its matte metal casing. The machine is 11mm thick, slimming down to just 2-3mm, weighs 4oz, contains a rechargeable battery and sports two stylus holders, one on each side. According to Nigel, the screen is a clear improvement on the Palm III's, offering better contrast, a superior reverse video backlight and an on-screen contrast control in place of the old mechanical version. However, the device still lacks one of the users' most-requested features: a colour screen. Unfortunately, since this story was posted, Nigel has removed his site -- do we detect the hidden hand of 3Com here? So here's the main piccy. ® See also WinCE catches up with Palm 3Com readies Palm IIIx two months before Palm V is due Palm at fives and sevens over release schedule 3Com greases Palm Computing Platform with wireless purchase
Business 19 09:00
A straightforward look at what's afoot...
There's never been more choice for system builders or assemblers than now. Two years ago, Intel effectively ruled the micropressor roost and that meant that whether you liked it or not, you were forced to take both yourself and your customers down their way. The reasons for that were that while both AMD and Cyrix had unveiled their plans for their future strategy, the chips were not out and there was still a lot of consumer resistance to anything which did not bear the Intel name. That's changed. Both industry and senior analysts in the arena now agree that the Cyrix M2 and the AMD K6 match and in some cases, outperform the Intel offerings. The other advantage of using Cyrix and AMD processors is that both these companies are currently actively wooing system integrators. There is also a new entrant into the CPU arena called Centaur, backed by ID, which is promising, and it claims, delivering, a chip suitable for Windows-based machines. But there's no doubt that because of its size and its marketing muscle, Intel still rules the roost, and sets the trend. In January, Intel will substantially cut the prices of its entry-level Pentium II (Klamath) processor, and in so doing paving the way for the demise of Pentium MMX chips and for introducing new technology, still codenamed Deschutes. That will be followed by further price cuts in March/April, which is when the Pentium MMX chips based on Socket 7 designs make their merry way to the microprocessor Gulag. Our information from the deep throats at Intel that we talk to is, however, that the introduction of Slot 2 technology, originally slated for the same time period, is now delayed, probably until the third quarter. However, Deschutes, which uses a .25 micron technology, is still, more or less in time. The introduction of chips based on this higher performance, higher yield design, will mean it is positioned as the high-end, allowing Intel to push the PII as the entry-level. Socket 7, as far as Intel is concerned, is on its way out. But see our separate story on the latest changes to both Deschutes and Slot One. Intel is also preparing a design which will add graphics meat to its Pentium II platform. This technology will introduce extra MMX instructions and, apparently, will be called Pentium III. In 1998, Intel will introduce a number of chips with higher clock speeds and also with what it promises are higher bus rates, giving additional performance and attractive to end users who like sheer horsepower. But, according to AMD, Intel will not have it its own way in 1998. Although demand has exceeded supply for the K6 during 1997, the senior executives at AMD are adamant that they will be able to significantly increase production and are still on target to introduce two brand new processors. Like Intel, AMD is moving to a .25 micron process, allowing it to make more chips from the same wafer, increase performance, and also lower heat consumption. That will allow AMD to make 300MHz, 350MHz and even 400MHz processors, it claims. As this piece is written, it is already sampling a 266MHz K6, which it says will be in production by the end of the year. The two new chips it will introduce next year are the K6 3D and the K6 3D+. The first of these offers signficantly improved graphical performance at the high end and AMD says it has already signed deals with a raft of software developers who are making games for it. It will have a 100MHz graphics bus. The 3D+, which comes much later in the AMD roadmap, will have a large die size but wholly eliminates the need for Level 2 cache, and offers such caching advantages through its 21 million transistors that it is likely to show a large performance gain over anything the company has made before, it claims. Cyrix was acquired by National Semiconductor earlier this year and that is probably good news for the company. NatSemi has such financial reserves that it will be able to back the Cyrix engineers' plans. They, as far as we can gather, are to follow AMD to some extent by producing faster processors which also have large cacheing abilities on board, while at the same time firmly targeting the consumer market with their MediaGX offerings. The new player on the block, Centaur/IDT, is targeting assemblers and system integrators who want to keep their costs down while still being able to perform Windows compatible systems. The company stresses that it is not offering anything other than a fast and very inexpensive Socket 7 based design for Windows. For exaple, while the unit has been tested for compatibility with Windows, Win applications and games, you would be unwise to use this chip for a Unix box. As with both Cyrix and AMD, Centaur is preparing a faster 3D version of its part with large cacheing abilities and also better floating point unit (FPU). That is likely to appear in 1998. Where the Centaur part does score is that it will significantly undercut its competitors on price while being able to ramp up its production fast because IDT, its parent, has excellent fab capabilities. The trick, next year, will be to watch the pricing from Intel carefully. We are reliably informed the Pentium II entry level cuts will be very significant. AMD has the ability to still undercut Intel because of its financial model. The big question for AMD is whether it can sort out its supply/demand problems and make enough parts to satisfy the hungry assembler market. ®
Business 19 09:27
To obscure the companies' closeness to rivals and the DoJ, apparently
Compaq tried to arrange side agreements with Microsoft that would camouflage the closeness of its relationship with Microsoft, according to an email released yesterday. The message, sent by senior VP John Rose in November 1997 to CEO Eckhard Pfeiffer and other senior Compaq execs, proposes a series of additional agreements that would make Compaq's core Windows licence deal "defendable" to rival OEMs and the Department of Justice. One might speculate that Rose, who has been on the stand as a Microsoft defence witness this week, was suggesting Compaq and Microsoft hoodwink rival PC makers and the Feds. The timing of the email is exquisite. In late 97 Microsoft and the DoJ were locked in legal combat over the latter's application for a preliminary injunction. The judge then granted the injunction, ordering Microsoft to stop forcing OEMs to ship Internet Explorer, but the ruling was later overturned on appeal. Compaq witnesses had been pivotal in the case up to that point, one of the major revelations being that Compaq had been threatened with the withdrawal of its Windows licence if it didn't restore the IE icon on the desktop. Although the Compaq witnesses had been subpoenaed, it still rather looked as if relations between the company and MS were in poor shape. But not necessarily. Rose had been attempting to renew Compaq's Windows licence for five years, but Microsoft's earlier consent decree negotiated with the DoJ had limited the period of licences to two years. Rose therefore wrote: "Given Microsoft's concern that our agreement be 'defendable' to other OEMs and the Department of Justice, we recently proposed an alternative structure where we would use side agreements to complement the Client OS license and MDA [market development agreement]." It's not clear what these side agreements were, and what shape the deal(s) eventually took. Compaq and Microsoft signed a new licence in March of last year, but Compaq has successfully kept the papers under court seal. Meanwhile, Judge Penfield Jackson has expressed his own bafflement over Compaq's tortuous deal-making. Rose earlier this week argued that Microsoft's threat to withdraw Compaq's Windows licence in 1996 was made because Compaq was in breach of an agreement it had made with Microsoft. A deal with AOL that required that IE be difficult to access had been made, he implied, subsequently to that. So it had all been a mistake. But the judge pointed out that although the MS-Compaq deal had been dated August 1995, it wasn't signed and put into effect until June 1996. If this is the case, then Compaq had been perfectly free to sign its deal with AOL, and mightn't actually have been in breach of its agreement until it signed the document that made it so. Why would it have done this? As Rose's email of the following year makes clear, Compaq was coming to the end of what had been a five year licensing deal with MS, and in 1996 MS was tightening its OEM agreements (no change there then). Rose had probably come to an 'arrangement' with Microsoft in August 95, but may have been holding back on signing it off in order to wring concessions out of Redmond. The "side agreements" mooted later may have been of a similar stamp. ® Complete Register trial coverage
Business 19 09:30
Whew... will it never end?
Reports from our friends in Japan claim that Intel will perform a somersault on its position on PC133 memory because of difficulties over yields on Rambus memories. Our friends in Japan are generally reliable. They tipped us off about the K6-3 being called the K6-III, remember? That news will cause sighs of relief from the rest of the industry, although we can expect to hear low moans from AMD and Cyrix, resolutely tracing Intel's footsteps in the PR snow. Where Intel leads, others must surely follow. Meanwhile, the same reports say that Intel will carry on pushing the 100MHz bus until the end of this year, but 133MHz bus products will reach 733MHz by year end. Before entering the bus gulag, Intel will release a 700MHz/100MHz part. ® See also Intel, chip-set vendors prepare for Rambus shortage
Business 19 09:42
World domination is us, says Stan of Haircuts
If anyone thinks that Eckhard Pfeiffer, CEO of Compaq, does not have aims at world domination, let these few words in a Q&A at the gruesome Landmark Hotel on Tuesday this week sink in. "Who is the next Microsoft? That's what matters." You have to search for the Nero inside yourself. Pfeiffer has several strings to his world domination bow and one of them is definitely the Alpha microprocessor. According to pre-eminent Compaq watcher Terry Shannon (see Shannon knows Compaq), his information is that a dual-chip Goldrush will beat a quad Sun 450 system hands down. This is the idea: keep the price of Alpha dropping until a system using the ex-DEC chip costs about the same as a comparable PC. Then go to Sun's customers and ask them why they're allowing Sun to reap 50 per cent profit margins, while demonstrating that Compaq's own -- equivalent or better systems -- only have profit margins of single digits. IBM and HP also get slightly bruised, but not as much as Sun. Of course, Samsung is on a spree to cut the prices of its Alpha chips by a huge amount, as previously reported here. Cunning, eh? ® RegOid Alphalpha Son of Daedalus, Eckhard Pfeiffer flew with his father Bill Gates from Crete but the sun melted his wax wings and he fell to earth. This story has no connection with David Bowie whatever.
Business 19 10:01
But what's with this 2.3 volt stuff?
Pictures of engineering samples of the AMD K6-III have been posted on the Web, with some benchmarks to boot. But the samples shown at Happy Cat pose questions about the core voltages of the parts. AMD is still seeking to spoil Intel's game after the Goliath held its preview day earlier this week, pulling in every human being and dog to the party. At the time, Craig Barrett, CEO of Intel, said that his company will be blitzing the world with an advertising frenzy later on this month. Meanwhile, over at JC's pages, there appears to be some new info about AMD's infamous K7... And all traces of AMD's K6-III FAQ page seem to have vanished forever... ®
Business 19 10:18
But it can't infringe Sun's copyrights, source or specs.
US District Judge Ronald Whyte yesterday ruled that Microsoft is allowed to create and ship independently developed Java technology, provided it does not violate Sun's copyrights, source code and specifications. The ruling follows the granting of a preliminary injunction granted last November forbidding Microsoft from shipping products that are not, according to Sun's definition, Java compatible. Microsoft appealed against that ruling early in December 1998. The preliminary injunction itself was granted by Judge Whyte in the San Jose District Court as part of Sun's breach-of-contract suit against Microsoft. The ruling, which was essentially a clarification of the preliminary injunction, allows Microsoft to continue to offer its Java development tools since they are not, claims MS, based on Sun source code. In its appeal, the company cited similar tools from other software vendors which also contain no Sun source yet are not banned from sale. However, the fact that Microsoft cannot infringe on Sun's specifications suggests that while the company can now offer its Java development tools they must, for the time being at least, pump out applets that meet Sun's definition of Java compatibility. The ruling may also help Microsoft decided on whether to push Cool, its C++ based object technology that's widely seen as a possible alternative to Java, at least on Windows (see Microsoft preps Cool to tool on Java). At the moment, claims Microsoft, Cool remains a research project, but could easily be expanded into a full-scale application development system that would offer both Java's simplicity and its level of object-orientation. That said, catching up with the degree of support Java has among the development community -- not to mention its level of cross-platform support -- might prove rather more difficult. ®
Business 19 12:10
What is it with all these shareholders?
Internet portal Lycos' proposed acquisition of Wired Ventures, former owner of techno-trendy's bible, Wired magazine, has begun to look as unlikely as the company's proposed merger with USA Networks. Again, the problem appears to be shareholders unhappy with the deal. Yesterday's Boston Herald reported that a group of Lycos' smaller shareholders are considering legal action against the company. Their beef centres on the complex acquisition proposal drawn up between Wired and Lycos, which would yield to some of Wired's largest backers a rather higher return on their investment than everyone else would get. Essentially, the deal involved a recapitalisation which reduced the value of the company's founding shares, and that in turn allowed more recent investors to expand their share of the company at the last minute. The recapitalisation is currently under review by the US Securities and Exchange Commission. Both Lycos and Wired bosses were yesterday keen to state their support for the acquisition, which would leave Lycos with the popular Hotbot search engine site and the WebMonkey Web design site, plus Hotwired, Wired News and other online properties. Lycos has already started building Hotbot into its own sites. The acquisition of these sites was, of course, one of the features that made Lycos so attractive to USA Networks. That deal is undergoing a rough ride of its own, but a collapse of the Wired deal is so unlikely -- even the minority shareholders who are complaining about the recapitalisation want it to go ahead, albeit on fairer terms -- that these latest ructions will do little to change the minds of investors opposed to the USA Networks merger. ®
Business 19 12:38
But the court may be less impressed than Redmond is...
Brad Chase seemed determined to show that he was no pushover for these eastern lawyers, and that he was going to be as unforthcoming as possible to David Boies' cross examination. His two and a half days stonewalling in the witness box was not a strong performance, but he was the least damaging witness for Microsoft so far. When the admission of some Microsoft exhibits was being discussed, Judge Jackson noted that the trial was characterised by "multiple, multiple hearsay". Boies for the DoJ was objecting to the admission of what amounted to lawyer-written letters while the trial was pending. For once, he was overruled and the judge said he would determine what weight, if any, the documents would be given. Six segments of a Microsoft-produced video were screened. John Warden, for Microsoft, showed he did not have the Latin, since when he was asked by the judge if he was going to show them seriatim, he replied he would show them one after the other. The videos were about the online services folder, AOL, and how "easy" it was for AOL users to download Navigator. Chase admitted that his direct testimony had been modified by Microsoft lawyers. Chase admitted that he thought IE4 was too big to download, but claimed that Microsoft had had 11 million downloads of IE4, and that to the best of his recollection, this was the number of successful downloads. He also admitted that Microsoft uses contractors to provide additional downloading capacity at peak times, but there was no information as to whether they were obliged to use NT servers, or if they could use Unix boxes. Nor was he aware of any logs for downloads, although Chases claimed in answer to an earlier question that there were logs. Boies asked him to produce evidence, but none was forthcoming. As with all Microsoft's witnesses, Chase gave the appearance of knowing so little about his business that it was surprising that he was able to keep his job. He did not know, he said, whether IE3 or IE4 had recovery capability if a download failed. Chase claimed that 17 per cent of people in the US obtained their browser by download, as of Q2 1998, but the source of this data was not given, and may be the telephone sample of some 200 users from the so-called MDC data set, which has questionable validity. Judge Jackson noted that when he had tried to check the sample size in Schmalensee's tables, it was not there. Chase was the first Microsoft witness to admit that Microsoft had a culture, and that it included "a large amount of self-critiquing". Chase used this explanation to minimise the significance of a deposition from Joe Belfiore, a Windows interface program manager, who said "There's tons of feedback that suggest that downloading IE takes too long, is too hard. You can go read pretty much any press reviews, just go talk to any people or experience it yourself and you'll find that the number of hours that it takes to download these components over a phone line is incredibly discouraging to people, often fails, and the result is that people don't get an improved user experience at all." Boies produced a 27 March 1997 email from Kumar Mehta in which he said that "almost 60 per cent of all surfers have never downloaded any software from the web. My sense is that these people are not very likely to download anything, let alone a browser that takes two hours to download from the web." Chase had claimed in his direct testimony that 70 per cent of Internet users had downloaded software. Mehta also wrote that "80 per cent of those who do not use IE say they have no plans to switch to it". Chase weakly suggested that Mehta was being dramatic on purpose, but had no evidence to contradict what had been written. Chase's catch phrases, in the Microsoft tradition, were that he could not recall, or didn't know, which he used to great effect. He did volunteer that he thought on average, "people have 1.5 browsers" which tended to make a nonsense of the carefully-crafted surveys that give the result that Microsoft wishes. There is no methodology to take into account people using more than one browser on a regular basis. Chase said that in Q1 of 1998, the installed base for Netscape Navigator was 27 million, and 29 million in Q3. For IE, it was 13.5 and 20 million for the same quarters -- a 48 per cent increase compared with Netscape's seven per cent increase. Chase claimed that 22 percent of AOL users preferred Navigator, as of Q3 1998. Boies questioned Chase closely about the demonstration of how AOL users could download Navigator in his video. Chase had not shown the installation process in the video, and couldn't recall how to do it. He claimed that the set-up process was self-explanatory. During a barrage of questioning by Boies, Judge Jackson evidently sensed there was something fishy happening, and said he wanted the relevant part of the video played again. Chase revealed in a 19 November 1997 email Microsoft's current thinking: "IE has become too big to download. We need to have a browser and mail download that is less than 30 minutes for a 28.8 modem. Can IE5 be downloaded so that it is a series of patches to IE4? Our partners, like AOL, need a smaller browser too. The set-up process is too hard for users to figure out. Only a little more than half of the people that download active set-up end up installing the browser. I think they don't figure out what to do once they download the set-up stub." In his cross examination, however, Chase wanted to change his story about the failure rate for downloads. Boies pressed him for proof, but he had none, and wasn't willing to look for evidence that he said he had written down. Boies then sprang his own video on a surprised Microsoft defence team. Warden complained Microsoft had had no notice. Judge Jackson told him "Well, he's serving you notice now." It was decided that the showing would be put off until the next day. At the screening, Chase admitted he had viewed the video with Microsoft attorneys, but it did not help him because Microsoft had again been misleading in Chase's video by leaving out the difficult and time consuming job of downloading and installing Navigator. The video was narrated by Glen Weadock, a DoJ witness. With dramatic effect, Boies started and stopped the video, rubbing in the difficulty of the steps that Microsoft had skipped. It took around an hour to install Netscape, and required some knowledge. Boies asked Chase if Netscape was allowed to put instructions on the screen to show AOL users how to download Navigator? Chase, perhaps remembering Gates' lessons on semantics, replied he didn't really know what was meant by "put instructions on the screen". Boies was of course rubbing in the point that AOL was not allowed to help users to download Navigator. Boise persisted, and asked if the contract with Microsoft prevented on-screen instructions. Chase again claimed the question was not clear to him. It was all very well playing to a Microsoft gallery back in Redmond with this bravado, but the only audience that mattered was the judge, so when Chase again said "Your question isn't perfectly clear" Judge Jackson snapped: "Well, it's clear to me." Eventually Chase was forced to admit that the AOL-Microsoft contract prevented there being any helpful instructions for AOL users who wanted to download Navigator. Chase said that a keyword could be guessed and entered to download Navigator, and that users could "just try it and see if it works." Again, the judge was not amused: "Well, there are lot of words that I could try that won't work." But worse was to come. The judge asked "What would happen if I called Microsoft" to ask what keyword to try. Chase said: "I don't know if we would know." Yet again Chase played semantic games, claiming not to understand what Boies meant by the use of Navigator with AOL being 'seamless'. Yet again Judge Jackson stepped in: "I have taken the word 'seamless' to mean throughout the course of this trial as a passage from one domain to the other without being aware of crossing any boundary." Chase then claimed that the use of Navigator with AOL was not seamless, and that the word was also used at Microsoft as a euphemism for 'easy'. There was just a subtle hint that Boies was getting tired of Chase's games. When Chase was taking a long time finding a page number in a document, Boies helpfully told him that the page numbers were in numerical order. Chase sent round a self-congratulatory email to Microsoft executive staff on 14 March 1996, the week the AOL deal was signed. His Q&A included: "I find it hard to believe that AOL is using Internet Explorer as it browser. Are there exceptions?" to which the response for the faithful was: "Yes there are some but they are pretty remote. An AOL customer could choose to use Navigator and it will be available to be downloaded from the AOL site, though not in a prominent way." Meantime, AOL set about transferring its 5 million customers (at that time) to IE. For somebody who had repeatedly demonstrated his poor memory, it was quite remarkable that he was able to deny that Gates had asked at a January 1996 meeting with AOL "How much do we need to pay you to screw Netscape?" Judge Jackson will have to draw his own conclusion about who is telling the truth -- and from his performance in the witness box, Chase does not look like the front runner in the veracity stakes. Chase reminded Boies that when he was in the front row during the evidence from David Colburn of AOL, he had been accused of being intimidatory by Boies, but was allowed to stay there. Boies sparred with Chase for some considerable time to little avail. It was perhaps unwise for Chase to say "I'm not sure what you mean" in response to Boies question as to whether Microsoft had an antitrust compliance programme. Furthermore, he wasn't sure if it was written down, and anyway "Our culture isn't basically based around manuals and things like that." Judge Jackson decided to tell his own little joke after lunch one day. "The code of tribal wisdom says that when you discover you are riding a dead horse, the best strategy is to dismount. In law firms, we often try other strategies with dead horses, including the following: buying a stronger whip; changing riders; saying things like 'this is the way we have always ridden this horse'; appointing a committee to study the horse; arranging to visit other firms to see how they ride dead horses; increasing the standards to ride dead horses; declaring that the horse is better, faster and cheaper dead; and finally, harnessing several dead horses together for increased speed." Boies did not flatter the judge for his effort, and suggested that the case should move along. But could it be that the joke was indeed as apposite as the judge suggested: that a dead horse was now being flogged by Microsoft's legal team, and that as far as he was concerned, the case was proved? The Senate hearings had had a considerable impact on Microsoft, it appears, but Chase's claim that events "were distracting from the core issue, which is our ability to innovate" was PR humbug. Boies produced some reviews where Navigator 4 was pronounced superior to IE4, and from Chase's responses it became clear just how hard Microsoft had tried to "win" the reviews. In the case of CNET for example, Chase knew immediately that CNET had been persuaded by Microsoft to repeat the review, and found IE to be superior. Chase was very reluctant to acknowledge the evidence that OEM distribution was highly important for IE. Kumar Mehta had presented data in April 1997 that users rated Navigator better than IE twice as often, and that "OEM is the leading distribution channel for IE". In recross examination, Boies pounced and produced an undated exhibit from Chase's personal files in which the first of Microsoft's goals was "increase end user Internet Explorer usage on OEM systems". There was also consideration being given to move the Microsoft sign-up wizard into the boot sequence. A browser marketing analysis by Bill Koszewski in May 98 stated that "IE4 is fundamentally not compelling" and "not differentiated from Netscape v4 -seen as a commodity". Chase would not accept that this is what Koszewski thought. At this point, Boies concluded his cross examination. Warden's redirect examination was mundane. Chase suggested, probably correctly, that AOL did not switch to Navigator at the end of December last year because Navigator was not componentised and ready for AOL to use. It will not be necessary for AOL to wait until the expiry of the renewed Microsoft contract in 2001 because AOL has done deals with major OEMs and often has its icon on the desktop. Chase speculated that AOL would move its CompuServe members to Navigator in due course. He saw the IE share of the browser market dropping to 30 percent on AOL when IE is displaced by Netscape as the preferred browser. He's backed by a $4 billion bet that some such move will happen. ® Complete Register trial coverage
Business 19 13:26
Change your logo or else, Goto tells Disney/Infoseek JV
Little known Net search service Goto.com (3.8 million unique views per month) is suing the Disney/Infoseek joint venture Go Network (21 million users at launch) over what it claims is the marked similarity between the two services' online logos. And just so we know what we're talking about, here are the two logos: To be fair, Goto.com isn't demanding Go Network to change its name or cease operating -- according to CEO Jeffrey Brewer, the company simply wants Go to change its logo, to avoid the confusion he claims the similarity is causing. According to Brewer, the suit was filed after negotiations between the two organisations, begun after Disney and Infoseek began testing the Go Network Web site. According to the Reuters newsagency, both Disney and Infoseek claimed Goto's suit was "baseless" and they would defend their use of the Go Network logo. ®
Business 19 13:27
Series covers how the issue should be presented to the public
One of the most secretive parts of Microsoft, and the company's greatest strength, is its PR department. An interesting email chain has entered the public domain because of the Microsoft trial. The issue discussed in the email was the problem of explaining to the public the IE/Windows "integration" in so-called contempt case in December 1997, shortly after the temporary injunction was issued by Judge Jackson (provisionally overturned on appeal) to prevent Microsoft requiring Windows 95 and IE3 to be distributed together. John Warden, Microsoft's lead attorney, argued furiously against the admission of the email chain centred on Microsoft vp and recent witness Brad Chase, but he was overruled by Judge Jackson. David Boies for the DoJ was successful in his argument that the emails cast doubt on four parts of Microsoft vp Brad Chase's direct testimony. The chain was labelled "attorney client mail" in the hope that it could not be demanded in court, but copying the emails to a Microsoft lawyer (David Heiner) was evidently insufficient to prevent disclosure. It was revealed that Dean Katz, a low-key but powerful figure in Microsoft PR matters, was asked by Mich Mathews, the manager of Microsoft corporate PR and Gates' principal PR minder, to work up the press releases for top-level press briefings that were to take place during the first week of 1998 in Redmond. Katz' affiliation is given as "Katz Communications Group" which suggests some independence from Microsoft, although he certainly is/has been a Microsoft spokesman for matters involving Gates, and politically sensitive issues. Chase was relying on Katz to turn the poorly-phrased email chain "into elegant prose". It is possible that Katz may be Gates' ghost writer for his NYT syndicated column, unless this is done by a NYT journalist. Katz emailed Chase and others on 31 December 1997, after the temporary injunction had been imposed, asking for simple but detailed answers to two questions: "What breaks if you remove IE3 retail version. What breaks if you just run the uninstall as the DoJ asks?" David Cole suggested that it would be "very dangerous of us to define integration as technical dependancy ... since there may not be technical dependancies to fall back on". He favoured pushing the line that "having IE integrated into Windows provides all kinds of end user and developer benefits". There were some difficult problems for Microsoft. Removing the files specified by the DoJ (in fact the 26 files that are removed by Uninstall) could break Windows with MSN and third party applications, but many third parties distributed new or updated components of Windows because of uncertainty as to the version of Windows being used, and these could mend a partially broken Windows 9x. The consequence was that it was truly hard to state with certainty what third party applications would and would not work. Ironically, Microsoft produced strong arguments an attachment to the emails: "Retail Windows 95 has about 9.5 million lines of code, IE4.0 has about 8.5 [million] lines of code. If they were separate products, you would assume that the full product would have 18 million lines of code. However, the full Windows 95 product, which includes IE, has 14 million lines of code." There is some missing information of course: whether it is IE4 that is included, rather than IE3; and the size of files that are common to Windows and IE as a separate product. It is strange that Microsoft has not been pushing this argument, if it is true. ® Complete Register trial coverage
Business 19 13:28
Pump up the DRAM
NeoMagic, the US notebook graphics accelerator vendor, is spreading its multimedia wings. The company has scooped up the business and engineering teams of Israel-based ACL, from Robomatics and the Manchester, UK based optical drive development group of Mitel Semiconductor. Terms were undisclosed. NeoMagic will incorporate Mitel Semi's DVD technology and ACL's image processing algorithms into its embedded DRAM technology. The acquisitions will help NeoMagic extend its embedded DRAM products beyond notebooks and into "a great variety of of small, highly portable digital multimedia devices and internet appliances", such as digital still and video cameras. ®
Business 19 13:39
Intel has lost the latest tussle with FTC lawyers in the run up to its antitrust case. Under protest, the chip giant is handing over historic pricing information to the FTC. It says the data is irrelevant, but the FTC insists it needs the information Intel’s mastery of the product life cycle is reflected in a pricing matrix which sees older chips heavily discounted to make way for new models. End-of-life chips enjoy a long retirement as even cheaper embeds for lifts or washing machines. (This avenue may not be particularly appropriate for the superpowerful Pentium III of today … or next week. Think how much a PIII-powered toaster would cost – even after allowing for the fact that you wouldn’t need a toasting element to burn the bread.) So far, so uncontroversial. But has Intel changed its pricing strategy in response to upstarts AMD and NetSemi-Cyrix in the last couple of years? The FTC will look for evidence that Intel is accelerating price cuts for new chips, to back up its argument that the chip vendor is abusing its dominant market position. The war of words begins in earnest on 9 March, the first day of FTC-Intel antitrust trial. ®
Business 19 14:09
Thin client vendor fattens channel
Network Computing Devices (NCD) has poached staff from its key rival Wyse as it attempts to double the size of its channel. The thin-client vendor has added five employees to its Windsor office in the UK. NCD currently has 30 UK resellers in its Diamond Partner programme and said the new personnel had been given the task of doubling this number by the end of 1999. Two new employees have come from thin client competitor Wyse Technology - Jon Starr is now NCD European distribution sales manager and Allan Tyrell is corporate accounts manager. Paul Robinson will join as UK senior technical sales engineer, coming from distributor Getech. A further two sales people will also join from the Network Displays unit of Tektronix, recently bought by NCD. Alan Grover - senior technical sales engineer and Tracey Neilson - UK Var manager. A representative of the California-based company said: "We want general and specialist resellers, but we are not looking for box-shifters." NCD distributes in the UK through Essex-based ADTCOM Network Computing, Chessington-based ilion and Matlock-based Sphinx CST. ®
Business 19 14:27
Biggest ever financial hit sees top man join the 15,000 NEC staff who've lost their jobs
NEC saw its president resign in the wake of 15,000 job cuts after the Japanese concern’s biggest financial loss in its history. The cuts have started at the top, with president Hisashi Kaneko one of the first to go. Speaking in Tokyo, Kaneko said he would resign and take responsibility for the IT giant’s expected Y150 billion ($1.25 billion)consolidated net loss to 31 March. The losses were partly a result of restructuring costs incurred by NEC’s Packard-Bell unit. They included NEC incurring a special loss of around Y75 billion to pay for the overhaul of the PC manufacturing unit. NEC, which this year marks its centenary, announced an overall restructuring plan to cut expenses, unprofitable business and 15,000 jobs over a three-year period. More than two thirds of those job cuts have already taken place. NEC said efforts had been hampered by falling demand for telecommunications kit in the home, weak semiconductor prices and a strong yen, as well as the general state of the industry. "With our restructuring efforts and the reshuffling of top management, we hope to create a revitalised NEC," said Kaneko. NEC also said it would buy Packard-Bell’s European operation for around $450 million. Kaneko’s resignation will be effective from 31 March. His shoes will be filled by NEC executive vice president Koji Nishigaki. Kaneko managed to retain his post as president last year through the scandal which saw ex-NEC chairman Tadahiro Sekimoto stand down over NEC’s involvement in contract paddling. Although Sekimoto was not implicated, he resigned after three NEC officials were indicted for questionable dealings with the Japanese Defence Agency. See earlier story. ®
Business 19 14:40
3Dfx gains Quantum3D support for Voodoo3 in exchange for cash
Visual simulation specialist Quantum3D has formed a business and technology alliance with 3Dfx, following the conclusion of its latest round of funding, which included an investment from the 3D graphics chipset developer. The alliance will see the two companies co-operating on the development and promotion of high-end products based on 3Dfx's Voodoo graphics technology. The deal also involves the cross-licensing of each partner's technologies. Quantum3D will also become 3Dfx's exclusive supplier of Voodoo3 technology to the visual simulation and coin-op markets. That 3Dfx would take a closer interest in Quantum3D comes as no surprise. Quantum3D has long been a Voodoo licensee, using each generation of the 3D graphics acceleration system to power its professional visual simulation-oriented Obsidian cards and its Quicksilver products for PC-based coin-op games. Quantum's products have been sold to the likes of Boeing, Lockheed Martin, Renault, Atari, Midway and Sega. However, its relationship with 3Dfx was strengthened last year when it became one of the few graphics card companies to reiterate its support for 3Dfx following the latter's purchase of card manufacturer STB (see Quantum3D maintains alliance with 3Dfx). For 3Dfx, not only does it make sense to back one of its most vociferous advocates, but Quantum3D's focus on professional applications is cherished as one of the few companies working outside of the games arena, the market with which 3Dfx is most -- almost exclusively, in fact -- associated. And at a time when many gamers and market watchers are wondering whether 3Dfx's forthcoming Voodoo3 technology can compete with arguably better products from ATI, S3 and nVidia, Quantum3D's design to stick with it is an important design win. Financial details of 3Dfx's investment in Quantum3D were not disclosed. ®
Business 19 16:02
We make up the answers we think the man might give...
Compaq CEO Eckhard Pfeiffer's appearance at the gruesome Landmark Hotel on Tuesday this week brought to mind an encounter we (almost) had with the great man last year... What is your idea of perfect happiness? A world where all my warehouses are empty. What is your greatest fear? A world where all my warehouses are full. With which historical figure do you most identify? You've got to search for the Nero inside yourself. What is the trait you most deplore in yourself? Having warehouses full of Compaq kit. What is the trait you most deplore in others? Having warehouses empty of HP kit. What vehicles do you own? I am a director on the board of General Motors. That, I think, says it all. What objects do you always carry with you? My MagicHat. What is your greatest extravagance? I have been known to spend money occasionally. What makes you depressed? A world where all my warehouses are full. What do you most dislike about your appearance? My hair. I have it re-styled regularly. What is your favourite fantasy? That all my warehouses are empty. Which words or phrases do you most overuse? ROI, which stands for return on investment. Also TCO, which stands for total cost of ownership. Do you believe in monogamy? Only in the context of a world where all Compaq warehouses are empty. For what cause would you die? The ROI. God save the ROI. What is your most unappealing habit? Being seen to be enjoying myself. Have you ever said "I love you" and not meant it? Only to Intel's Hans Geyer at an Etre conference some years ago. How do you relax? I like to go for long walks through my warehouses and around my factories. How often do you have sex? I don't really think that is any of The Register's business. What would your motto be? Shareholders, think how well I have done in terms of return on investment and executing on my plans. What keeps you awake at night? Inventory is always a worry. That and not being able to deliver ROI to Compaq's shareholders. How would you like to die? Happy at the thought that I had delivered and executed my plans. Do you believe in life after death? There is too much stock in the channel to worry about such trifling issues. How would you like to be remembered? I think you know the answer to that question. Which is the most important lesson life has taught you? If you cannot execute on your plans to deliver ROI to shareholders and the TCO paradigm to your end users, life is hardly worth living. ®
Business 19 16:07
Cybervillage reveals roadmap details
Acorn Cybervillage has published some tantalising details of the roadmap for the SA-220, Intel's next generation StrongARM. Codenamed the Coyanosa, the SA-220 will ship in Q2 2000. The new StrongARM family is built to 0.18 micron spec, and various flavours run from 100MHz to 600MHz They retain the low-power features of the first generation StrongARM family, Cybervillage's Stuart Halliday, says. He reveals that new versions of the SA-220 include the Cotulla (SA-2100) and the Benbrook (SA-2500). "These devices are to run in simpler veins to the SA-1100 and the SA-1500 developed for Element 14 (the company formerly known as Acorn) but of course with a SA-220 core." According to Halliday’s sources, "Intel firmly sees the target markets for the StrongARM to be in the maturing set-top box markets". ®
Business 19 16:20
Dial-up service comes crashing down
More than 180,000 users in the UK have been left stranded in limbo after BT's Internet dial-up service crashed this morning. The service failed at around 9.30am depriving people of access to their e-mail and the Web. BT Internet's home page (www.btinternet.com) was also affected by the technical glitch. According to BT, engineers are working to correct the problem, but a member of BT's telephone support staff said it would be lunchtime at the earliest before it's up and running again. "It's simply not good enough," said one irate BT Internet customer who agreed to be quoted as long as he wasn't named. "I depend on BT's Net access for my job yet I have lost a morning's work already -- who's to say I'm not going to be wiped out this afternoon as well?" He added that this was not the first time that the service has experienced problems. A representative of BT Internet -- which has more than 180,000 customers in the UK -- was asked to comment but failed to return the call before the story went to press. ®
Business 19 16:33
ISP demands EC action to stop DT using monopoly position to control e-commerce
AOL Europe wants the European Commission to end anti-competitive practices by Deutsche Telekom (DT), the former state-monopoly telecoms operator in Germany. In a strongly worded statement, the leading Internet access company alleges that DT is "abusing its dominant position in the German telephony market to weaken competition for internet access. "DT's abusive conduct includes discrimination in the provision and pricing of Internet-related services, and predatory pricing -- attempting to undercut competition by effectively operating at a loss," it says. In particular, AOL Europe maintains that DT is attempting to establish its subsidiary T-OnLine (TOL) to be the gatekeeper for all e-commerce in Germany". Andreas Schmidt, president and CEO of AOL Europe, said: "There are important principles at stake here about the rights of consumers to choose a service that's becoming increasingly important in all our lives. "This will only come about if action is taken to prevent former state monopoly telcos from using their inherited market power to diminish competition in this critical economic sector." AOL Europe says it is taking this action as part of a broader strategy to open up European Internet markets and remove obstacles to their growth. ® See also AOL Europe demands flat-rate fee for Net connections
Business 19 16:39
It's stifling European online business' ability to compete, claims CEO
High telephone call charges are smothering the development of an Internet-based economy in Europe, according to leading Internet access provider AOL. In an unprecedented and outspoken statement issued today, the world's largest Internet access provider lent its full support for a radical overhaul of the telecom pricing structures in Europe. Without immediate change, Europe risks falling behind other regions such as the US, the company maintains, something AOL believes would be lamentable. "We must overhaul the outdated telecoms pricing structure which sustains artificially high call rates for consumers," said Andreas Schmidt, president and CEO of AOL Europe. "The EU has an historic opportunity to build an information-based economy -- one that will fuel job creation and provide consumers and businesses with an unprecedented array of new choices." "However, this will only happen if Europe takes action now to eliminate high local call prices and per minute charging for consumers. The head of the Campaign Unmetered Telecommunications (CUT), a UK-based organisation that lobbies for change throughout Europe, has welcomed AOL's support of unmetered calls. CUT's Alastair Scott was flabbergasted that such a big player in the industry had come out in support of his campaign. "This is an extremely important move. AOL is the biggest advocate yet in favour of unmetered telecoms charges," he said. But a spokesperson for British Telecom disputed claims that call charges were high and said that the company offered "value for money". He said supporting unmetered calls was akin to getting something for nothing. "There's no such thing as a free lunch," he said. ® See also AOL slams Deutche Telekom Net access foul play
Business 19 16:52
But the club doesn't let just anyone in
After the frenzied activity of online shares, the Dow Jones has created a separate index to track US Internet-related stocks. Dow Jones & Co yesterday launched the Dow Jones Internet Index -- DJII to its friends -- which aims to represent around 80 per cent of the total Internet stock market capitalisation. At the moment, only about 40 companies can make the grade, according to the Dow Jones. The entrance rules are strict. To become part of this elite club companies must make at least half their turnover from the Internet, have been public for a minimum of three months, have had a three-month average market capitalisation of at least $100 million, have an average closing price over $10 and have enough volume to pass liquidity tests. The stocks will be reviewed quarterly. The DJII will have two sub-indices, dealing with Internet commerce stocks and Internet services. The company Web site today stated: "Rather than assembling a grab-bag of stocks that have some connection with the Internet, no matter how little or how vague, Dow Jones has built an equity benchmark index of companies that generate the majority of their revenues from the Internet." There are currently 15 stocks in the Commerce index, from Amazon.com to Yahoo!, and 25 in Services, including AOL and PSINet. ®
Business 19 16:57
IT buyers to face another barrage of scare stories
Even after the year 2000 date change has come and gone, IT users will not be safe. The next IT bogey-man will be, of all things, ecommerce, according to a survey carried out by Boole & Babbage. The management solutions company surveyed 75 IT managers in November 1998 and found that ecommerce was one of the most stressful aspects of the IT managers working day. Some 46 per cent of respondents said that it was their biggest worry - flesh-eating millennium bug excepted. Issues such as bandwidth, workflow systems and legacy integration were all cited as being part of the problem. Managing director of Boole & Babbage, Charles Southwood, said: "The millennium bug has been the biggest issue in recent years. However, ecommerce poses specific challenges and strains on the IT department." A further 38 per cent of those surveyed believed that monitoring and analysing systems would cause them the most concern in the next millennium. Costs, skills availability and knowledge management barely registered as concerns voiced by those surveyed. ®
Business 19 17:35
Brits to get in yer face advertising on the desktop
Free-PC, the US company that gave "free" computers to punters willing to sell their soul and intimate financial details, is coming to the UK. The US company gave away 10,000 Compaq Presarios this month in a $10 million experiment. Its owner Idealab will launch here this year, according to Ziff-Davis’ news site ZDNet. Free-PC makes its cash by selling advertising that regularly bombards users on-screen. It also sells personal information about its users’ buying habits. See earlier story. One million people applied for the Free-pc.com computer give-away bonanza in the US. Only 10,000 were selected. CSL analyst Clive Longbottom said this should be a lesson to us all, but feels it could give the IT industry a boost. "Customers must have the right profile to qualify for one of these machines. The questionnaire only targets those people the advertisers are interested in, and that’s people with disposable income," said Longbottom. The PCs have a 15" screen, with banner advertising constantly taking up around 2" on every side. This restricts the user to around a 10" screen, whilst subject to the barrage of distracting advertisements vying for their attention. Longbottom said: "I think people will get so fed up with this." He could be right. The ads cannot be removed, but this need not infringe on your personal space too much. After extensive research, The Register can reveal that a piece of cardboard strategically secured around the inside of the screen can block out those pesky ads. And voila - a genuine free PC. ®
Business 19 18:32
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