29th > April > 1999 Archive

The Register breaking news

Zander dismantles Solar System

A year ago From The Register No. 74, April 1998 Sun's inherent loopiness was muted somewhat this week via restructuring. The outfit's five operating companies, sometimes apparently known as 'planets,' have been busted down to divisions, while two more key divisions, Network Storage and Consumer/Embedded Markets, have been added. The reorg appears to clip the wings of the divisions somewhat, tightening-up their reporting to COO Ed 'Death Star Destroyer of Planets' Zander, who says that they'll now be able to attack new markets faster and more effectively, while offering "a unified face to the customer." So Sun has decided that it's about time everybody sang from the same hymn sheet, and maybe it's also thinking it's big enough to start behaving more like a normal corporation. The divisions will lose some autonomy, and SunSoft is being rechristened Solaris Software, which sounds a little like it's going to be focussing more closely on core product lines. The other divisions are Sun Service, Sun Microelectronics and Sun Microsystems Computer Co. The Consumer/Embedded division is the biggest news, however. Sun's been pushing hard into these areas, so the appearance of the new division signals a determination to grab share in the smart phone, set-top box, in-car and appliance areas. ®
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Rioworks mobo introduced

Rioworks has joined the list of motherboard vendors to introduce support for Intel's 810 chipset. The company said that the BS81-M will support chips running at 300MHz-433MHz or higher. Interestingly, Rioworks said that the board is suitable for corporate IT environments, confirming the acceptance of the low priced Celeron, rather than highly priced Pentium IIs. The BS81-M has support for 2D and 3D graphics, AC97 Audio, an AMR slot and supports Ultra DMA/66. There is no ISA slot on the board, confirming that mobo manufacturers are beginning to follow the Wintel plan to eliminate so-called legacy systems. ®
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Osmosis pledges to repay debts

Software and components distributor Osmosis has confirmed it is in dire financial straits and is junking unprofitable operations back in an attempt to stop the collapse of the entire group. The company held a press conference in London yesterday and issued a press release which carried the heading Osmosis wants to honour all creditors. This brave move is an attempt by Osmosis to distance itself from the stereotype of a company that runs away from its bad debts. John Fenton, Osmosis MD, said the company had been hit by a number of bad debts, some of which relate to the collapse of Roldec and Memsolve. He said Osmosis is suing the company it had outsourced its despatch functions to. "They made a lot of mistakes in August, September and October," he said. "That meant a lot of customers wouldn't pay up, in some cases we couldn't even prove if goods had been delivered." "The whole thing, combined, was a real problem. We came very close to the wire. So we decided to concentrate on the more profitable, less difficult parts of the group." The Osmosis Group will no longer sell PC components and is pulling the plugs on its own non-brand PC manufacturing operation. It will continue to operate as a Microsoft OEM, and despite having none of its on PCs to install the software on, will aim to sell it on the open market. Osmosis also operates a grey market operation, Tradelink, which buys components from overseas markets. This was described as being the Osmosis cash cow and will continue to run, alongside PPIS, the group's Internet-for-SMEs company. Fenton said the actions of some company directors when their businesses hit trouble left him "quite frankly disgusted" and said he was at pains to act differently. "I have my own code of ethics and that's important to me. I didn't go into business just to go out of business," he said. Fenton pledged to chasing up all Osmosis unpaid debts and seeing that all his creditors are paid in full. He said he had received positive reactions from all the Osmosis creditors he had spoken to so far. From a high-spot of £199 million turnover last year and a headcount of around 125 staff, the company will shrink back to retain only 19 employees and will have an estimated turnover of between £50-100 million. Osmosis' Irish operation is to be sold off to its management later this year.®
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Corel back on track, says CEO

Interview Corel CEO Michael Cowpland sounded-off to The Register in Amsterdam during the Dutch InterNetworking trade show. In the league table of optimists, Corel CEO Michael Cowpland must be near the top. Corel has had a series of bad quarters until the last quarter of fiscal 1998, as it adjusted its business model. It does now look as though Cowpland may pull it all off and break through to profits at a useful level. He is also one of the few CEOs that is well-grounded in the technology (his PhD was in electrical engineering at Imperial College, London). One of his first business ventures was to form Mitel (Mike and Terry's lawnmowers -- remote controlled, of course), which he sold before going on to found Corel, initially specialising in graphics products. His acquisition of WordPerfect from Novell gave Corel the launching pad for an Office suite of its own. The Dutch market has traditionally favoured WordPerfect, Cowpland noted, with 47 per cent of word processing being done with WP. Unfortunately, many are still using version 5.1, and there has been a tendency for users eventually to migrate to Word because, as Cowpland put it, Corel was losing money as it was going through a consolidation and turn around, so was not well-perceived. Reviews of the final version of Corel's WordPerfect Office 2000 suite have been recommending it for its file compatibility. Corel sees Microsoft's complex file structures as being detrimental to Microsoft, but an advantage for Corel. Corel is providing conversion with XML, ODMA, ODBC and HTML, as well as with Microsoft VBA and file compatibility with VBA and Microsoft Office. Back from the doldrums Corel expects to emerge victorious from the doldrums with a series of new releases, including WordPerfect Office 2000, CorelDRAW 9, as well as WordPerfect Office for Linux in Q4, and CorelDRAW 9 for Linux in Q1 2000. Corel's income is derived about 55 per cent from its Office suite, and 45 percent from graphics software, with Europe providing around 40 per cent of Corel's revenue. The active user base for WordPerfect is 35 million worldwide, Cowpland claimed. Cowpland sees his deal with PC Chips, a Chinese company with 30,000 employees making no-name boxes, as "a big coup". Of the 100 million PCs sold each year, half come from well-known companies, with the remainder coming primarily from PC Chips, "the largest manufacturer in the world" of motherboards, making more than Intel, Cowpland said. The result will be that Corel's Office suite will be included with 20 per cent of the world's PCs as a result of this single deal. Corel sees the exercise as being one that will gain mindshare at the bottom of the pyramid, and expects the use of Corel products will move upwards, especially when it has finished its Linux version. Cowpland on... Free PCs Cowpland thinks ISPs will increasingly give away Web access devices, which would cost them around $300 per user per year. In the second year, however, the OEM would make money. This will happen worldwide, he thinks, with the US market being about a year ahead than the remainder of the world. Cowpland drew the analogy of Amazon.com effectively giving away $30 in the first year, and recovering the outlay in the second year. Next Page
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Corel back on track – page 2 of 3

Previous Page Cowpland on... Java Cowpland is adamant that WordPerfect Office 2000 for Linux and Corel Draw 9 for Linux were not going to be a re-run of Corel's less than successful efforts on the Java front. "Sun over-promised and under-delivered," Cowpland claimed. "You could say that Sun conned the industry because there's never been a Java as promised. We took a bit of heat for that. "The good thing about Linux is that it's out there, performing like a champion today... The Linux technology is more solid than Windows. There were onerous licensing terms." Cowpland continued: "They [Sun] were charging $250,000 [licence fee] for something that was supposed to be open technology. It was a nice idea that never came through." So far as IBM's use of Java was concerned, Cowpland believed that IBM was using Java "to unify their internal languages". Windows compatibility Corel is playing a significant role in the Wine project, which makes it possible for any Windows application to run on Linux at the same speed as on Windows, unlike with emulators such as Wabi that run more slowly. Cowpland estimated that Corel is providing around 20 per cent of the effort for Wine, with a dozen or so programmers working on it. The end result for Corel will be the software for a Linux desktop. Corel has also announced an alliance with KDE (for its Project product) and Debian (for its GNU/Linux distribution). Corel is positioning itself as a mass market Linux supplier, with tens of millions of units, while Red Hat and Caldera will be more service-based, Cowpland said. Corel has a list of important things missing from Linux at the moment, and Cowpland claims to be addressing each one. The result will be Corel's own Linux distribution. Next Page
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Corel back on track – page 3 of 3

Previous Page Cowpland on... Microsoft In its competition with Microsoft, Cowpland is playing a high-volume, low-cost strategy. Corel sales went up in units in the last year in the US market, while Lotus has fallen to around two per cent of the market. Another part of the strategy is to offer in effect a light version free, and have a full version available for a fee. Cowpland would like Microsoft to be forced to use XML as a standard file format as one of the outcomes of the Microsoft trial. We asked Cowpland what other outcomes he would like to see from the Microsoft trial. He said he would like to see Microsoft not allowed to cross-bundle products. Small OEMs were unable to fight Microsoft, he noted, since if Microsoft chose to withhold Windows from them, it would take too long to get the DoJ to act and remedy the situation, so tough measures were needed. Cowpland also favours Microsoft being forced to publish and adhere to a price list. This would stop many Windows pricing deals that had an anti-competitive intention. Cowpland supported Scott McNealy's suggestion to The Register that Microsoft should not be allowed to do any more acquisitions. Cowpland said it was a critical-mass issue, and once that point had been reached, progress would be rapid. Cowpland observed that since the trial started, Microsoft has been more reasonable to deal with, and no longer demanded something like $100/copy for Windows if it does not like the OEM. The DOJ scrutiny has therefore proved useful already. Canadian Club With the shutting of the Utah operation inherited from Novell, the remaining WordPerfect developers are now consolidated in Ottawa with Corel's graphics team, which Cowpland sees as a significant advantage. Separate units only work if there is a single major centre, with some outworking by small groups for particular purposes. Cowpland is the major Corel shareholder with around ten per cent, so he was particularly pleased that the stock price was climbing again. Corel has a number of products coming to market now, so it seems that the present quarter will be profitable. Novell had decided some time back to liquidate its holding, which has been keeping the share price down, Cowpland noted. Last month, Corel acquired clip-art, photograph and Web images producer GraphicCorp for $10.3 million, in a deal that included a million shares of Corel stock at a guaranteed price of no less than $6.30 on 30 September. Cowpland said he is not concerned about meeting this requirement. Corel looks as though it could become a tough competitor for Microsoft if it can achieve critical mass. If it comes to a mano e mano, Microsoft should remember that Cowpland has a black belt in martial arts -- and played in the Wimbledon veterans finals. Now who's for tennis? ®
The Register breaking news

ARM denies role in Acorn dismemberment

Thanks to everyone who referred The Register to ARM’s press release of April 27. "The board of ARM Holdings plc has noted the announcement of the recommended offer made by MSDW Investment Holdings Limited for Acorn Group plc. The board would like to clarify that ARM Holdings plc has no involvement in the transaction." So what’s going on here. Acorn was not taken over by ARM -- as the Financial Times and The Register reported -- but by merchant bank Morgan Stanley Dean Witter (MSDW). This is one of the pitfalls of journalism -- mistakes are made in public. The Acorn dismemberment story is one of our more interesting errors. For the end result is exactly the same as Acorn had been taken over by ARM. Instead of having one very weak shareholder (Acorn) controlling an uncomfortably large stake, now there are many shareholders. This will improve liquidity in ARM shares, already helped by a stock-split last month. And in the long term, should help drive ARM share prices up. Taxman don't cometh So why didn’t ARM buy its own shares back from Acorn. The reason is simple – tax planning. Acorn’s stake in ARM is heavily discounted. And ARM would have to pay somewhere near the market price for its own shares. But then this would leave a hefty capital gains tax liability of £50 million or so. This is where MSDW comes in. Effectively, the investment is buying Acorn with Acorn’s own shares. It is offering two ARM shares for every five Acorn shares. At the same time it will take care of the tax liability. A more precise valuation would see MSDW offering 1 for 2, but then it would make no money. MSDW's reward is a nice chunk of ARM shares -- worth £50 million or so -- more or less the same as the capital tax liability. Now we don’t want you thinking MSDW is a not-for-profit institution. The company will write off the tax liability against tax losses incurred, either here or in the UK. So this £50 million worth of shares represents pure profit. MSDW says it will take a proprietary position in ARM -- in other words it will act on its on account and not as an intermediary for another company. But for how long? Despite this statement, MSDW looks like a parking place for ARM’s shares, until they are off-loaded onto the market for a hefty profit. And where better would those shares end up than ARM? It would get £50 million worth of shares – sans tax liability. Done but not dusted The Acorn dismemberment is not quite a done deal -- another investment bank could always come along and offer the same sort of offer, but making only £25 million profit. However with irrevocable acceptances of more than 50 per cent, it is difficult to see another bank prepared to throw a spanner in the works. Acorn’s institutional shareholders will be happy with the way the company’s ARM shares have been unlocked -- and in such an elegant, tax-efficient way. Acorn’s individual shareholders are entitled to be just a little suspicious -- especially longstanding shareholders who are part of the small army of Acorn platform fans. People who bought into Acorn as a cheap way into ARM will make a handsome profit. And where did the rest of Acorn go? But what about the rest of Acorn -- the two operating businesses are effectively being given away? Yes, we know it is difficult to value loss-making businesses, but using net asset value as the yardstick looks awfully like a device to pay as little as possible. Net asset value is a way of measuring businesses like property companies -- not IP-rich IT design houses. Acorn’s DSP business is being sold for £1.5 million – its net asset value -- to the Acorn management team led by Stan Boland. Presumably Acorn’s cash stays in this business, to meet working capital requirements and fund expansion. The DSP business is the sort of operation that an ST Microelectronics or Phillips Semiconductor will come along one day and buy for several million pounds. Acorn’s set-top operation is to be sold to Pace MicroElectronics for just £200K -- the net asset value of the business. Pace, a mover and shaker in the digital set-top business, also inherits Acorn’s stake in RISC OS. This way, Stan Boland and the Acorn community get to part company. Which is probably for the best, as the two sides have never seemed to get along particularly well. Pace says it remains committed to the RISC OS, which is good news for the Acorn community. But isn’t it really time to make this operating system open source? ®
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Bleem beats back second Sony strike

Bleem, the company that makes the Windows-based PlayStation emulator of the same name, appears to have beaten back Sony's latest attempt to force it to stop shipping product. According to the emulator developer, Sony launched last Friday a second request for a temporary restraining order against it. The first attempt, made last month, was denied, and yesterday US District Court Judge Charles Legge through out the second try. Bleem said the decision clears the way for it to begin shipping its eponymous emulator in earnest. Still, it shouldn't rest easy. Only nine days ago, Legge rules that fellow emulator developer Connectix, creator of the Mac-based PlayStation emulator, Virtual GameStation (VGS), does have to cease shipping product pending Sony's main case against it (see Sony wins second victory). Sony claims Connectix violated its intellectual property in the development of VGS, and the emulator promotes software piracy. Connectix denies all charges. Sony accuses Bleem of similar transgressions. Bleem's second victory should give heart to Connectix, which is preparing its appeal against Legge's earlier decision. That said, without seeing Legge's precise ruling in each case, it's difficult to say whether his decisions are based on fundamental differences in each company's case -- was Bleem better able to show cleaner engineering principles than Connectix? -- or he has failed to fully appreciate the technical issues. Certainly, the ruling against Connectix seems unfair in the light of yesterday's decison. ®
The Register breaking news

Amazon.com revenue rises 236 per cent

Amazon.com's sales continue to expand, but its profits remain elusive -- and the company warned they will continue to be so for some time. The Internet bookstore yesterday posted a first quarter 1999 loss of $61.7 million on revenues of $293.6 million, and increase of 236 per cent on the same period last year. Half of Amazon's loss was put down to the company's ongoing acquisition programme -- excluding such charges, its loss falls to $36.4 million, better but still significant. In Q1 1998, Amazon posted a loss of $10.4 million. Still, the revenue increase is impressive, doubly so since it's higher than the strong sales figures the company posted for its Christmas quarter: for Q4 1998, the company recorded revenues of $253 million. That suggests the company is winning business and winning it fast, though CFO Joy Covey predicted the growth rate would slow as the novelty of new lines, such as videos and gifts, begins to wear off. Covey also warned that losses will deepen "substantially" in coming quarters as Amazon continues to expand its own business by buying others. Losses for coming quarters would be in the order of $60-90 million, she said. The company's oft-stated goal is to offer "anything" online, to become the Internet's answer to Harrods (elephants, anyone?), and it can do that more quickly by spending money and making acquisitions. And given Amazon's inflated stock price and the very rapid turnover of its publicly traded shares, it's unlikely to have dividend-hungry shareholders beating on its door and demanding profits, at least for the foreseeable future. ®
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25 per cent of Sega staff for the chop

Sega is to cut 1000 jobs -- 25 per cent of its workforce -- next year, following a poor set of results for the last 12 months. The games console maker yesterday warned it will post of loss of around Y45 billion for fiscal 1998, which ended on 31 March. Sega blamed lower-than-anticipated sales of consoles and software, and poor attendance at its UK and Australian video game arcades. Losses there will see the company writing off around Y33.3 billion as it withdraws its stake in those businesses; writing off inventory of the superannuated Saturn games console will add Y11.5 billion to that figure. All of which leaves the company focusing its hopes on its profitable Asian video game arcade business and sales of its 128-bit Dreamcast console. The trouble is, Dreamcast sales are way behind predictions, partly because of the difficulty chip maker NEC had manufacturing sufficient quantities of the console's graphics PowerVR processor, but also because demand for the machine is growing slowly. Sega originally hoped to shift one million Dreamcasts by the end of calendar 1998. NEC's problems forced it to put that deadline back to fiscal year end, but in the event Sega still missed its target, by 100,000 units. Demand won't be helped by Sony's canny decision to unveil its 128-bit PlayStation 2 early. Ironically, it's the original PlayStation that did for the Saturn. The Sony console isn't set to ship until the end of the year, but it will still hurt Dreamcast sales as buyers decide to wait and see how the two consoles compare. ®
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Katmai was resurrected because of AMD threat

Sources close to Intel's plans have told The Register that for a period of time .25 micron Katmai was cancelled. But Intel resuscitated the beast because of the ominous threat of the K6-III, the well-informed source said today. "Time to market rules at Intel, always," the source said. "Coppermine with more L2 cache is a further attempt to kill the K6-III and prepare for the introduction of the K7." He said: "The Katmai core, common to all these products, is little more than a Deschutes, itself a shrink of Klamath P6SC technology with an improved FPU and multimedia execution units." He said that Deschutes was probably the best CPU Intel had ever fabbed, and the core for the Pentium III, Xeon, Celeron, Celeron A, mobile Pentium II and mobile Celeron. "They'll continue to milk that core for everything they can get out of it," he said. It was somewhat flattering for AMD that Intel, the shark, should take the minnow's plans so seriously, he added. Another source, also close to Intel's plans said: "Intel sees AMD as its big threat and not players like Cyrix, Rise and IDT. "®
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Thomson Consumer Electronics backs MP3

French state-owned consumer electronics giant Thomson Multimedia has taken a 20 per cent stake in MusicMatch, the company that develops MP3 playback, encoding and management software for Diamond Multimedia's Rio and Creative Technologies' Nomad players. The deal gives Thomson access to MusicMatch's Jukebox software, and it's clear the company is looking keenly at the opportunities to offer a range of hardware systems based on Jukebox. "MP3-playing car audio, stereos and TV set-tops are all possibilities," said a spokesman for Thomson's US subsidiary, which offers kit under the RCA and General Electric brands as well as its own. The support of well-known consumer electronics brands, along with the major record labels, is widely seen as an essential pre-requisite if the online music market is to attract music buyers beyond its current computer user niche. The success of portable players like Diamond's Rio has placed online music on consumer electronics companies' radar screens, but most of them appear to be waiting for the music industry to come to a consensus on file formats and anti-piracy measures before voicing their support. So far, only Sony, Samsung and now Thomson have admitted to planning entries into the digital music arena. Sony president Nobuyuki Idei recently said the company was developing a Walkman-style digital music player, provisionally dubbed the Netman, and Samsung yesterday said it is to offer its Yepp MP3 player worldwide. Still, Thomson's decision to back MP3 as its format of choice is interesting given its connections with Microsoft, which owns a 7.5 per cent stake in the French company. Microsoft was granted the stake by the French government back in November 1998 (see French government publishes details of Thomson stakes) in return for an agreement that the two companies would co-operate on interactive TV and Internet TV-related products. The move saw Thomson standardise on Windows CE for set-top boxes and market the Microsoft-owned WinTV system under its various brands. Microsoft, of course, has its own digital audio format (MS Audio 4.0) and digital music management system (Windows Media Technologies 4.0), so clearly Thomson, for one, reckons MP3 will win out in end, for all Microsoft's power and claims that MS Audio is technologically superior. With the Secure Digital Music Initiative preparing a broad specification for anti-piracy systems, into which MP3 could easily be slotted, and MP3 companies developing their own copyright-protection measures, MP3 is becoming less of a threat to the recording industry's major players. That allows MP3 to join the battle now being fought between the numerous file formats for record label and hardware vendor support, and as more companies like Thomson come on board, MP3's rivals are going to find life a lot tougher. ®
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Asian memory fabs return to full production

Further evidence that the DRAM market is on the mend has emerged. According to the Friday edition of The Korean Herald, South Korean and Japanese fabs are practically back to full production. This time last year, the major memory manufacturers in Asia reduced production because of poor sales. There was also pressure on the companies from customers to reduce production so that prices would not continue to slump. The newspaper says that Samsung, Hyundai and LG Semicon will maintain full production throughout the summer of 1999. ®
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NEC claims breakthrough on quantum computer

Japanese company NEC, together with other researchers, claimed today they have made a breakthrough on the supercomputing front. According to NEC, the consortium has developed the fundamental building block for a future quantum computer by controlling the superposition of quantum states in a solid state electron device. The quantum states are used to represent data as a quantum bit or qubit, with similar characteristics to the binaries used by current machines. And NEC claims that when a machine is built using the breakthrough, it will allow computation to be thousands or millions of times more powerful than current supercomputers. NEC boffins made the solid state qubit by creating a so-called Cooper pair box by connecting a super conducting electrode some billionths of a meter with a reservoir of electrons using a Josephson Junction2. Quantum superposition states allowed the wave-like quanta to tunnel through the junction. In the device, two quantum states with a different number of electrons are coupled into superposition. ®
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Microsoft launches streaming media division

Microsoft's move to beat RealNetworks at its own game advanced a step yesterday when the Great Satan of Software announced the formation of a streaming media marketing unit. The aptly named Streaming Media Division will develop Microsoft's streaming technology, announced earlier this month and going under the Windows Media Technologies (WMT) 4.0 banner. WMT is already in public beta, so the move, from a technological standpoint at least, is simply about giving the development team their own space away from the broader Windows 9x/2000 development programmes. The marketing aspect is more important. With RealNetworks dominating streamed audio and video -- it owns roughly 85 per cent of the market -- particularly now it has teamed up with IBM, Microsoft needs to show it's serious about winning the war. The WMT launch boasted the backing some leading Internet-based media companies, but by no means were they the majority or the most important players in the field. Creating a business unit dedicated to streaming should, Microsoft hopes, convince any doubters. It may also help to counter that other streaming media wannabe, Apple, which launched its bid the week after the WMT roll-out. Apple is pushing QuickTime, already the dominant standard for computer-based video creation and playback. With the addition of streaming technology, that puts Apple in a strong position. Its canny move to offer its streaming server software under an open source-style licence will help too. Apple's coup with Lucasfilm to offer the trailer to the upcoming Star Wars movie in QuickTime format has clearly demonstrated the importance of winning big-name support, and Microsoft desperately needs such headline-grabbing alliances for WMT. Movie studios are likely to be high on the division's list of priorities, and given the budget this team is likely to be working to expect both Real and Apple to be rapidly outbid. ®
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Free phone calls for UK this summer

Two schemes offering users free calls in exchange for listening to ads will start in the UK this summer. New phone company on the block, Freedom, looks set to pip BT to the post by offering the first nationwide system on 1 June. The scheme works by subjecting users to radio-like ads at the start of each call, then periodically bombarding them with other 10-second ads throughout their conversation. In the same month, BT will pilot its own service in the Tyne & Wear and Bristol areas. But this is not scheduled for the rest of the UK until later this summer. Freedom, a privately held phone company that Noel Edmonds has shares in, said its Free-to-Talk scheme could handle up to 2 million customers. The service will be offered in conjunction with fellow investors Energis and Siemens, according to today’s Financial Times. BT has teamed up with Swedish company GratisTel, which developed the idea. Yesterday it predicted its BT Freetime would appeal to kids – letting them chat to friends without running up huge phone bills. Although the little darlings will, of course, be subject to all manner of commercials advising them how to spend their pocket money. In return for completing a ‘lifestyle questionnaire’, users will receive a free number to dial and personal identity number to use before making BT Freetime calls. They can alternate between making normal paid or free calls, according to today’s Daily Mail. GratisTel has already launched similar schemes in Sweden, Denmark, Italy, Norway and the US. Advertisers include McDonald’s, CNN and Yahoo! No potential UK advertisers have yet been named. ®
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PCs going cheap from Egg

Fujitsu has come up with a different slant on that old conundrum -- which came first, the chicken or the egg? It has teamed up with Egg to offer Internauts the chance of a PIII PC with subscription-free Net access, all for less than £1,000. The offer is part of Egg's tentative move into the real world of ecommerce and although it won't make much out of the deal, it is a start. Earlier this week it announced it would only be accepting new customers of its online banking service via the Internet. Yet, the tie-up with Fujitsu, which was pre-announced last month, is aimed at those people who don't already have Net access. Spot the dilemma? You can only join Egg via the Net and here’s a PC aimed at first-time buyers: so, which comes first, your PC or your Egg? A chirpy spokeswoman at Egg said the offer was available to everyone regardless of whether they intended to join Egg or not. Mike Harris, head of Egg, added: "At Egg we recognise that the ecommerce revolution is already here and will do everything we can to support developments in technology and help new and existing customers who want to be on-line. "By joining forces with Fujitsu our customers can enjoy the benefits of ecommerce." ®
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CIH virus hits Taiwan hardest

The CIH virus struck hardest among countries where pirated software was most prolific, according to software company Data Fellows. The bug, which hit about 300 users – or 20 known companies - in the UK, caused most damage in Asia. Thousands of hard disks were overwritten overnight on 25 and 26 May in Taiwan alone, says the anti-virus and encryption company. Jason Holloway, Data Fellows UK country manager, described these traditional centres for counterfeit software as breeding grounds for CIH. "In countries like Taiwan, where users are not reluctant to use illegal software, the CIH virus has done the most damage. This is because viruses can be carried in the copied software," he said. CIH was also believed to have disabled 230 PCs at one police force in Africa. Holloway warned: "Users think that once they have bought anti-virus software, they are safe. But it must be updated to be effective - we discover six to seven new viruses per day." The author of CIH – or the Chernobyl virus as it is also known – has been identified as one Chen Ing-hau. The former student of the Tatung Institute of Technology named the virus using his initials. Just as well he didn't name it after the initials of his former college. ®
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Freeserve users targeted by free call offer

The UK could be about to become embroiled in bloody battle for ISP supremacy following the official launch today of screaming.net. The service -- a joint venture between rival electrical retailer, Tempo, and LocalTel, an independent Surrey-based service provider for BT -- is to compete directly with the phenomenally successful Dixons Freeserve. Pulling no punches, Michael Kraftman, Tempo deputy chairman, said he was gunning for existing Freeserve customers. And the offer of toll free dial-up access during evening and weekends could prove too much for users eager to cut the cost of Net access. If it lives up to the hype and delivers a quality service at a fraction of the price, it could lead to a mass desertion of Freeserve subscribers. "We think screaming.net will actually affect the psychology of Internet use in Britain," said Kraftman. "The whole psychology of getting onto the Net will change." Indeed it could, if the offer of free phone calls rings true, but for that to happen users will have to switch to LocalTel. Whether people are prepared to switch carriers -- even with the added incentive of 10 per cent discount on all telephone calls (except calls to mobiles) -- is another matter. But for one campaign group that is lobbying for the introduction of US-style unmetered telecomms charges, it is a start. "Tempo and LocalTel… have made a bold step which, for once, takes account of what telecommunications users in this country want," said Alastair Scott, of the Campaign for Unmetered Telecommunications (CUT). "At last, for some of the time, the ticking of the clock and the ratcheting up of the bill will no longer be an issue; screaming.net tackles the principal barrier to Internet access in this country, which is open-ended telecommunications charges." ®