29th > October > 1999 Archive

The Register breaking news

Etre 99: to be or not to be

It was supposed to start at 16.00. The two presenters are sitting in the corner talking to each other. The time is now 16.40. No one knows what to do or when to do it. You've guessed it -- this is Etre 99 Containing what I hope to be some insights and useful observations, my notes follow. If you don't have the time, just scroll down to the bottom for my overview of the event.
Rod Banner, 29 Oct 1999
The Register breaking news

Intel execs outline Y2K chip futures

We weren't there because it was midnight UK time and we were practising our Halloween tactics, but thanks to the power of the Wibbly Wobbly Web we were able to catch up with what the Intel luminaries (can employees of a Satan be luminaries?, ed) had to say at an executive briefing yesterday. We did this courtesy of Intel's Web site, where there's a Webcast. Unless you've got a high powered machine and a fast link, you'll be very frustrated by this process. The most interesting slide Intel showed, as it happened, was the last in Craig Barrett's presentation, which presented some details of Intel's future roadmap and scotched the Willamette processor by the end of 1999 canard. The slide showed Intel producing a Willamette at a greater speed than 1GHz in the second half of next year; along with that, there will be Pentium IIIs at speeds greater than 800MHz. Timna, Intel's system on a chip processor, will be positioned as a "value desktop" chip in the same time period, along with 600MHz Celerons. In the first half of 2000, the Celeron 500MHz will move into the value desktop space (isn't it already there?), while the mainstream desktop space will be a 800MHz Pentium III, presumably in its Coppermine recension. A similar Xeon at 800MHz will sit in the server space. The Itanic, formerly known as Merced, is positioned as being in the high end server space in the second half of next year. Intel said the Itanic is already running Oracle 8, Apache IIs and other applications. Sean Maloney, a senior VP at Intel, said the Taiwanese earthquake had little effect on the company, aside from graphics chip. But even here, current stock would be enough to soak up any problems. There was an "adequate" supply of motherboards, although supply is tight. This is the problem with the BX/ZX chipset which Intel has had since June. Concerns about the so-called millennium bug had not affected Intel shipments. Paul Otellini's slides were fairly interesting. Intel confirmed that there will be IA-32 Xeons with up to 2Mb of on-die cache, as already revealed here. The company said little about the Caminogate i820 fiasco, other than to point out it was still part of its plans. But it did say that by Q4 of next year the .18 micron process it is currently producing will enable a 20 per cent reduction in the price of Celerons and a 50 per cent reduction in the price of desktop processors. It showed a slide confirming that its flip chip S370 packaging would kill SECC2 (Slot 1), by the end of next year, and that the .18 micron process would supersede the current .25 micron process in the same period of time. Nearly 100 per cent of Intel processors will be .18 micron by the end of next year. It claimed it was regaining market share in the US retail market. Earlier this year, rival AMD took a chunk out of this sector. ®
Mike Magee, 29 Oct 1999
The Register breaking news

Packard Bell shows Panrix red card over footy ad

Panrix is alleging foul play after its advert was pulled from the Leeds United football ground to placate the club's sponsor, Packard Bell. The Leeds-based PC builder paid a five-figure sum for a full season's advertising board, bearing the words "Panrix Computer Systems". But the ad disappeared after less than two months, with Panrix only discovering the change when one of its staff attended a football match at the Elland Road ground. It came to light that Leeds United had shown the Panrix ad the red card for fear of offending its sponsor, retail PC Goliath Packard Bell. Phil Brining, commercial manager at Leeds United, said the Panrix advert had been a mistake which contravened the football club's own contract with Packard Bell. There was a veto on certain product adverts, and the football club, currently topping the Premier League, was not allowed to display ads from any computer "rival" to Packard Bell. "It [the Panrix advert] should never have been there in the first place," said Brining. "Occasionally there is an error, and one of our advertising agents takes an order from one of the companies they shouldn't." Yet a month after the removal of the offending add, Panrix had neither received a refund, nor seen the advert re-instated. It contacted the agency that originally sold Panrix the ad, MICG in London, and eventually received the following offer: the ad would go back up, but it would have a slight amendment. Simon Panesar, Panrix managing director, said: "We were told by the agency that Packard Bell would not approve the advert bearing the words 'computer systems'. So it could only go back up saying just Panrix." "The whole thing's a sham and we've referred the matter to our solicitor." "It's clear that Packard Bell is running shy of Panrix's presence," said Panesar. Packard Bell said it was unaware of the conflict until this week, when Brining informed them of the situation. A Packard Bell representative said: "There was no pressure put on to remove the Panrix advert. It was the decision of Leeds United." An MICG representative told The Register it was "making a mountain out of a molehill", which isn't the same as making money out of selling adverts that no one gets to see. MICG refused to give further details. ®
Linda Harrison, 29 Oct 1999
The Register breaking news

Compel issues profit warning

Compel joined the plethora of IT companies issuing profit warnings yesterday. The UK company warned that results for the year ending June 2000 were expected to fall materially below forecasts. It blamed a worse than expected slowdown in customers buying IT. "As the year 2000 date change draws closer it is becoming increasingly apparent that the slowdown in expenditure in the corporate sector is more marked than originally envisaged," said Neville Davis, Compel chairman and chief executive. "In recent weeks an increasing number of customers have announced IT expenditure lockdowns, which are being rigorously and comprehensively implemented. In addition, it is now clear that many other customers are reducing IT expenditure and taking a very careful approach to their activities in the run up to the date change." However, Davis said this downturn in demand caused by Y2K was a "one-off and limited phenomenon", and remained upbeat about the future. "We expect a marked upturn in expenditure levels to begin during the first half of 2000 as organisations fulfil pent up demand. "Over the longer term, we anticipate growth in IT expenditure to continue as large organisations use IT not just to make themselves more efficient, but to transform their activities." ®
Linda Harrison, 29 Oct 1999
The Register breaking news

King of the Jungle bags HP marketeer

Hewlett-Packard UK is losing one of its top level staff to the growing empire of Steve Bennett. Patricia Rubio, HP marketing manager for PCs, has been poached by the IT entrepreneur for a new venture in December. The two will be starting a media business to promote Bennett's jungle.com and Software Warehouse operations, sources told The Register. Rubio confirmed: "I'll be working with [Bennett] -- we're setting up a company together." But she declined to comment further. ®
Linda Harrison, 29 Oct 1999
The Register breaking news

Inprise reports Q3 loss, consults legals on MS brand heist

Inprise produced a net loss of $1.4 million (3 cents/share) in its Q3 reported yesterday, but less than the 10 cents loss of the First Call consensus. The Q3 revenue was up 17 per cent on the previous quarter, but at $46 million, 5 per cent down on the year-earlier quarter. The company is cash rich, with $179 million at the end of September. Dale Fuller, CEO and acting president after Dell Yocam was pushed out in March, said that Inprise was "continuing to execute on our plan to return to operational profitability." The market had no comment before the results were announced, with the share price closing unchanged. The quarter just reported benefited from the release of Delphi 5, but how Inprise will price the rapid application tool for Linux that it has under development could be a significant determinant of Inprise's income after it is released. Microsoft has grabbed Inprise's "AppCenter" trademark for Microsoft Windows DNA 2000 application manager server. With Microsoft supposedly being chums with Inprise again, it was hardly likely that Microsoft was unaware that Inprise was using the name AppCenter for its platform to manage CORBA, DCOM (and EJB from version 4 in December). Of course, Microsoft doesn't like cross-platform software, so when in September Microsoft pirated the name, was it done deliberately? Alternatively, it could have been corporate clumsiness by Microsoft, which is now large enough to fall over itself quite easily, in which case Microsoft should back down quickly and apologise. So far Inprise has only reached the stage of getting a trademark lawyer to look into the matter, it became known this week. This is far from being the first time that Microsoft has "accidentally" forgotten to check if a trade name it proposes to use has already been bagged. The last major instance was when it tried to use "PalmPC" for its CE devices. Not surprisingly, 3Com objected to this try-on and sued. For once, Microsoft agreed to settle and now uses the name palm-sized PCs. Inprise, formerly Borland, has suffered greatly from Microsoft's desire to annihilate it. In June, Microsoft inked a series of agreements as a result of which it paid Inprise $100 million for the right to use Inprise patents in Microsoft products, settle patent and licensing disputes, and purchase $25 million of Inprise stock. For its part, Inprise agreed to support Windows 2000 and license MFC and the Windows development kit. Previously Microsoft enticed key Borland staff to move to Microsoft, which was then the subject of litigation. It is rumoured that the money used to acquire Visigenics in March 1998 may have come from a separate out-of-court settlement the previous year. ®
Graham Lea, 29 Oct 1999
The Register breaking news

US Net founder elected to ICANN board

Despite rumours that the first elected ICANN board would accommodate no US citizens, Net founder and bona fide Son of Uncle Sam Vinton Cerf was elected to the last available seat. Cerf, one of the Net's co-developers responsible for TCP/IP protocol, is currently senior VP of Internet architecture and technology for MCI Worldcom. The ICANN board elections have proven unpopular on Capitol Hill, where members of Congress worry that its make-up would be a bit more appropriate for the Rainbow Coalition than for a body governing what many believe is chiefly an American property. Some have suggested that by establishing ICANN, the Clinton Administration has inadvertently given away a resource developed and cultivated by Americans, for Americans. House Commerce Committee Chairman Thomas Bliley (Republican, Virginia) is said to be considerably less than thrilled with the election results. It was Bliley's committee that heard testimony in July on the topic "Domain Name System Privatization: Is ICANN Out of Control?" Cerf may not turn out the last American to be seated on the board, however, as another nine seats have yet to be filled. We can expect numerous warning growls from the Hill as that process gets under way. ®
Thomas C Greene, 29 Oct 1999
The Register breaking news

David Goldman, Sage

Obituary The death of Sage founder David Goldman, after a long illness, will have been greeted with great sadness across the in the IT industry this week.
Simon Meredith, 29 Oct 1999
The Register breaking news

Computacenter buys Metrologie

Update Computacenter has agreed to buy Metrologie, less than a week after the CHS Electronics subsidiary went on the market. Metrologie will continue to trade under its own name. The UK reseller this morning confirmed the sale from administrators BDO Stoy Hayward, saying more details would be given this afternoon. The deal covers Metrologie's volume distribution arm, which will be used to extend the reach of Computacenter's own distribution business (CCD). Computacenter will also get access to Metrologie's Enterprise Distribution business, which specialises in UNIX, server, consultancy and integration, sources told The Register. Metrologie was put into administration, along with its parent company CHS Electronics Holdings in the UK, earlier this week. This followed the sale of its sister company, CHS Electronics Plc, to rival distributor Northamber. ®
Linda Harrison, 29 Oct 1999
The Register breaking news

So, who really invented the Net?

News that a senior minister in Her Majesty's government didn't know his Arpanet from his elbow has ruffled some feathers among learned British Net users. A number of people have contacted The Register to say that Chancellor of the Exchequer, Gordon Brown, was right when he claimed yesterday that the Internet was a British invention. Surely, there's some mistake? Everyone knows that those military techies in the US invented the Net, just as everyone knows that it was an American who first set foot on the moon. "Not so," cried an uncharacteristically vocal band of Brits eager to defend one of the nation's finest technological accomplishments. "You're the one that made the gaffe -- the Net was invented in Britain to send stuff to Sweden. So there," wrote one reader, no doubt with brass knobs on. Other, more reasoned arguments, have suggested that the Net was invented by The Open University and/or the National Physical Laboratory in UK. As reader, Andrew Pitt, explained: "It does seem a little off the mark for Mr Brown to make wide assumptions about the birth of the Internet, but he does have a somewhat misguided point. "Packet Switching, the basis of transmitting information over the Internet by dividing the data into small chunks was invented at Middlesex University. The developers at the time saw great potential and contacted the Minister responsible for technology, which was Tony Benn at the time. However, the government never allocated any money and the research went abroad where ARPA was doling out large sums of money. "So, in a somewhat ironic note, it was actually the last Labour government that killed the early development of the Internet in Britain. It's a very similar story to that of Sir Frank Whittle and the jet engine -- it's a shame the establishment have a dangerous habit of ignoring these people." So, the Net was invented by Brits and rubbished by the same political party back then, that is now attempting to turn the country into a cybernation of wired junkies. Does this now mean that our American readers -- who remained strangely silent when it seemed that The Register was upholding their claim to being the country that invented the Net -- will now bless us with their views on this matter? That is, of course, if Britain and the US aren't in an all-out email blocking war by then... ®
Tim Richardson, 29 Oct 1999
The Register breaking news

Karma follows sister companies into receivership

Karma UK has gone into administrative receivership, the final CHS Electronics domino to fall in Britain. Peter Copp and Edward Blackwood from BDO Stoy Hayward have been appointed administrative receivers for the PC components distributor. Copp said: "Failure of other companies within the CHS group has had a knock on effect on Karma UK, which has been trading profitably. "We are talking to potential buyers and expect to announce the results next week." The other CHS subsidiaries in the UK to be sold this week are: Metrologie UK, snapped up by Computacenter today from receivers BDO Stoy Hayward, and CHS Electronics Plc, sold to Northamber on Tuesday. Meanwhile, CHS is scrambling for cash sales on some of its Latin American businesses. ®
Linda Harrison, 29 Oct 1999
The Register breaking news

Sony preps satellite digital content delivery service

Sony has firmed up its plan to distribute digital content via satellite. According to Japanese business daily Nihon Keizai Shimbun, the company will today apply for a satellite data broadcasting licence. Once Japan's Ministry of Posts and Telecommunications has granted a licence, Sony will create a wholly owned subsidiary worth some Y500 million ($472,590) to use it. Sony's satellite scheme emerged back in March after initial Japanese press reports suggested the company was developing an Internet-based music delivery system. Soon after, the company confirmed that is was creating a content distribution system, but one that operated by satellite. Initially, the service was provided through News International's PerfecTV satellite network, but it's clear that now it has proved itself, Sony wants to bring the whole thing in-house. In any case, the move ties in with Sony's vision that in the digital world content will ultimately be delivered to consumers via broadband networks rather than physical media. That's the basis for the upcoming PlayStation 2, which will ultimately become not just a games console but a home's gateway to the Net and the content transmitted across it. Sony plans to offer PlayStation 2 owners a digital content delivery system in 2001 -- a year after the console's launch. The delay is the time Sony estimates it will take for sufficiently broadband networks to be put in place to handle data-intensive applications like streaming DVD-quality video. Its satellite system could easily be viewed as one way of providing such a broadband delivery network. Sony isn't the only Japanese company to view satellite links as the next stage in broadband networking. NTT DoCoMo and NTT Data yesterday applied for a joint satellite digital data broadcasting licence. And a consortium of ten businesses, including Fujitsu, Canon and Hitachi, are to form a joint venture to provide satellite-based digital data broadcasting services, Nihon Keizai Shimbun said. ®
Tony Smith, 29 Oct 1999
The Register breaking news

Intel likely to bring Solano chipset forward

Sources close to Intel plans said today that the company had plans to release its i815 (Solano) chipset early, in a bid to bridge some of the gaps in its portfolio. The Solano chipset, although an extension of the i810 (Whitney) chipset, has support for AGP 4x. Although it was intended to be produced in the first half of next year, the indications now are that it will bring the introduction forward. That could be as early as December according to the sources, who added that Intel will make modifications so that an AGP slot can be added to motherboards. The i810e chipset has come under some criticism because it uses an integrated graphics solution which is comparatively low-end. Although Intel planned to use this integrated technology in the same way, it now seems as though the company will extend Solano. ®
Mike Magee, 29 Oct 1999
The Register breaking news

Willamette due 2H 2000

We've been keeping a pretty close watch on Chipzilla's reaction to Athlon's success, as have a sizeable number of moles around the World. So when a normally reliable source tells us Willamette is coming real soon now, we pass that info on to our readers. It appears, however, that this time our sources got a bit ahead of themselves with the timescales as Intel officially stated yesterday that the fabled 'Athlon killer' won't appear before the second half of next year. Of course, Intel timeframes are notoriously flexible, so only time will tell if our sources were right. Yesterday, Intel's CEO, Craig Barrett, showed a slide to analysts that has Willamette, clocked at over 1GHz, slated for the second half of next year (see Intel execs outline Y2K chip futures). ®
Pete Sherriff, 29 Oct 1999
The Register breaking news

Intel CuMine fails to dampen AMD's Athlon squib

PC vendors are being told by their distributors and brokers that supply on Slot 1 Intel cartridges is constrained. That follows the launch of Intel's "Coppermine" 733MHz processor at the beginning of the week, and a further story showing there were big delays on its flip-chip S370 technology and its mobile parts. Intel has generated demand it cannot supply. One manufacturer, who declined to be named, said: "Intel has announced a 733MHz product it can't ship in volume, while on the other hand the AMD 700MHz Athlon is available in big numbers". He said he'd even had calls from companies asking if he could sell them Slot One parts, a move he described as "highly unusual". He said he believed Intel's technology announcement on Monday was intended to dampen enthusiasm for AMD's high end processors. He added that he did not expect to see FC-PGA Slot 370 Coppermines until the beginning of the year 2000. ®
Mike Magee, 29 Oct 1999
The Register breaking news

Iridium rival ICO plans Teledesic makeover

ICO Global Communications, the other satellite mobile phone company stuck in bankruptcy hell, may have found a way to get itself unstuck. According to the Dow Jones newswire, ICO will next month announce its plan to recast itself not as an alternative to Iridium but as a rival to Teledesic, the 'Internet in the sky' satellite-based broadband network company owned, in part, by Bill Gates. ICO's scheme calls for $60 million to be spent on modifications to its as et unlaunched satellites to allow them to handle high bandwidth data traffic. ICO will then sell access to its network to companies keen to provide mobile data services. Formed in 1995, ICO's history neatly parallels that of fellow bankrupt mobile phone company, Iridium. Both went bankrupt in August after defaulting on bond interest payments. ICO owed $43 million; Iridium, $90 million. But while Iridium is still struggling to persuade its shareholders to put up some more cash for a restructure, ICO has managed to win a further $225 million from its backers. They may offer more. ICO's new plan is based on the assumptions that business will demand ever more data bandwidth, and that users will increasingly require mobile data solutions. Whether it can provide a useful solution to the latter is open to question -- the vast expansion in cellular communications that did it for ICO and Iridium are just as likely to clean up in the mobile date arena. However, providing high capacity links to an ever more bandwidth-hungry world does make sense. And since ICO can adapt its 12-odd satellites this way -- unlike Iridium's network, ICO's devices are still on the ground -- it's just as able to switch its business model around. Iridium can't, which is probably why it's having such a tough time with its backers. ®
Tony Smith, 29 Oct 1999
The Register breaking news

Dell's hidden page on Rambus exposed

Perhaps one of the PC manufacturers which has suffered the most from Intel's decision to withdraw its i820 board at the last minute is Dell. It was very, very ready to roll until the very last minute. But wait. It used to have a page all about how wonderful Rambus was and a reader has sent us a copy. The page was here but it's Web-brushed out, to be replaced by this page here which says how wonderful SDRAM is. The cyber-brushed missing page said, pre-Caminogate, that RDRAM delivered a 166 per cent overall increase in system performance compared to existing 100MHz SDRAM. That has to be disputed. Most hardware sites that got their mitts on 820+Rambus agreed its performance delta compared to BX boards was only a few percentage points. It also says, err...used to say, that "RDRAM delivers 1.6Gb/second bandwidth compared to 800Mb/s with SDRAM. In other words, 64MB of RDRAM would have the equivalent bandwidth of 128MB of SDRAM." No. Dell also had a diagram which claimed that SDRAM was first in, first out, while RDRAM memory required no waiting in line. No. Rambus has a serial like interface and SDRAM is parallel. We are still waiting to hear when the i820, Phoenix like, arises from Caminogate... ®
Mike Magee, 29 Oct 1999
The Register breaking news

Can France drive open source as Europe's standard?

Analysis The French move to make open source software the official state standard, proposal 495, has created a great deal of interest, not to say scepticism. Are the two senators behind 495 mavericks who'll be ignored? Is this a classic French trick designed to boost French companies and undermine les americains? Will it happen, and if so, will the model sweep Europe? To some extent you could answer yes to each of the above. Elected representatives, as Al Gore and Tony Blair abundantly illustrate, are seldom well-informed, altruistic evangelists when it comes to IT, and the fact that Senators Laffitte and Tregouet seem astonishingly well-informed doesn't mean that France is brimful of other politicians who are. So even if the pair get at least some aspects of their proposal adopted, there's a substantial risk that it will be implemented in such a way as to help France, and French industry. Nevertheless, if it is adopted it stands some chance of being picked up by Europe as a whole, as Laffitte himself hopes. It's worth noting here that 495 is being proposed for two basic reasons. First, as a measure to make technology and information more accessible to all citizens, and second, to improve communications, cut costs and increase flexibility between and to and from state agencies. There's an overlap between these two areas, clearly, but overall you think of 495 as being, or forming part of, a French 'Superhighway' bill. That might be an advantage to Laffitte and Tregouet, but could be a disadvantage. French prime minister Lionel Jospin already has his own catch-all superhighway legislation in preparation, scheduled to arrive in the second half of next year, so there's a maverick aspect to 495. Some of the ideas behind 495 might therefore be able to hitch a lift on this, but on the other hand 495 might be entirely ignored by it. Laffitte himself seems to anticipate a faster road to law for the proposal; he suggested recently that after thorough debate it could be added as an extension to a pending law giving legal status to digital signatures. That would likely give it a faster and easier passage, but the closer the proposal gets to reality, the more likely it is to run into opposition, especially once Microsoft's woken up to the implications. A 495-based law could be seen as providing the mechanisms to build a France-wide, and then Europe-wide, information infrastructure that would empower the citizenry and accelerate European IT development and deployment. But it would also be one of those hybrid social/technological initiatives that tend to cause trouble between Europe and the US. If it were made compulsory (as 495 envisages) for state agencies to use only open source software it would be mere nanoseconds before the US trade team was popping up, thundering about protectionism and threatening the perpetrators with the World Trade Organisation. Governments do of course lay down requirements for the software they use, and these requirements do rule out quite a few suppliers. But an open source only policy wouldn't be related to factors like quality, performance, security or robustness. On the contrary, it would specifically rule out other software regardless of its quality, and would therefore be a sitting duck for WTO sanctions. If it happened then we'd almost certainly see the US and the WTO lining up to force France/Europe to buy Microsoft software, but there's plenty non-open source software out there besides Microsoft, and in its most extreme form the policy would outlaw that too. So if the proposers of 495 are to achieve long-term success they'll find themselves having to alter their pitch somewhat so that, rather than espousing open source and only open source, they achieve their aims by setting up hurdles which all classes of software can conceivably pass. These could include the use of open standards and open file formats, and depending on how far they went they might well achieve the two senators' aims without pushing the trade hot button by making open source compulsory. It's not entirely clear that Laffitte and Tregouet have thought this out fully as yet. Laffitte kicked off the forum for 495 a couple of weeks ago, but so far hasn't had a chance to respond to most of the discussion that's taken place there. It is however significant that he notes that software companies are starting to move from a sales to a service model, and that in addition to IBM and Sun "Microsoft seems to me ready to follow this path." That's actually pretty loaded, because although yes, Microsoft has expressed an intention to move to a service model, it's not going anywhere near an open source one. Does that mean Laffitte thinks Microsoft can be pushed further, or that he'd be prepared to settle for a free/low cost, partially open (in the old Open Systems mould, perhaps?) software model rather than full-blown open source? The answer is quite possibly a bit of both. Laffitte himself is no tyro when it comes to technology, and Tregouet is a French free software hero, and something of a geek. Laffitte can claim responsibility for the construction of Sophia-Antipolis, the tech city in the south that is France's version of Silicon Valley. Sophia-Antipolis, is a very French phenomenon; the original Silicon Valley just kind of grew, in an American kind of way, whereas the French implementation was specifically put there by the government. A similar centralised planning approach will govern whatever France does with respect to 495 and/or Jospin's initiative, and it will also be what drives France Telecom's rollout of the infrastructure and hardware to go with them. Tregouet, our French readers tell us, is an old school free software advocate who's well-known for his efforts in getting IT out into the countryside, and for a blockbuster 1998 report on new technologies in information and communication. The report is available in French here, but The Register was more impressed that the Good Senator is himself a .org, and seems to publish a regular tech newsletter on his site. You can see this week's edition here. Again it's in French, but it's obviously pretty comprehensive. We may well offer this guy a job. ®
John Lettice, 29 Oct 1999
The Register breaking news

Y2k bug eats StorageTek jobs

StorageTek is to chop 20 per cent of its workforce after reporting tumbling Q3 profits. The US storage vendor reported a net loss of $16 million for the quarter ended 24 September 1999. This included pre-tax charges of $32.4 million, relating to litigation and a voluntary staff redundancy program. For the same period last year, the storage giant recorded a profit of $50.6 million. Sales were $573.7 million, against $571.1 million. David Weiss, StorageTek chairman, president and CEO, said Q4 results would match Q3, with sales for 2000 smaller, but with higher profits. "Performance in the third quarter was affected by revenue growth that was below our expectations as well as disappointing margins in our consulting and integration services businesses. "We did not bring to revenue enough of the products under evaluation at customer sites," said Weiss. "Some of this was due to customers delaying purchase decisions because of their Y2K testing issues. "I expect these issues will continue to be felt more in our mainframe market rather than in our growing client-server business into the first quarter of 2000. Revenue from storage products was down seven per cent to $355.7 million. Tape revenue grew, but disk sales suffered due to declining sales to IBM. Big Blue announced earlier this year that it would stop buying StorageTek's disk array products, which it was reselling under its own brand, to develop its own rival technology. This left the 6,000 customer base up for grabs. StorageTek outlined a restructure plan, saying it hoped to save up to $150 million annually. It will run until the second quarter of 2000 with between 1,500 and 1,750 job losses worldwide. The company will also cut investment in areas including consulting, integration and managed storage, and simplify its sales model. According to Weiss: "We are focusing our resources on the businesses where we have done well and see the best opportunity for profitable growth." "Tape automation is our cornerstone, a reliable cash generator with significant areas of growth potential. "Storage area networks and virtual technology are our two most promising areas for significant future growth, in both tape and disk." ®
Linda Harrison, 29 Oct 1999
The Register breaking news

Ingram upbeat despite profit slip

Ingram Micro saw profits nosedive for the third quarter. The US distribution giant reported pre-tax profit of $17.5 million before exceptionals for the three months ended 2 October 1999. This excluded $2.7 million of reorganisation costs, and compared to $59.8 million for the same period last year. Sales were up 18 per cent at $6.71 billion. The results were in line with Ingram's previously revised estimates of pre-tax profit falling between $15 and $21 million. Earnings per diluted share were 11 cents, down on last year's 40 cents. "As expected, Ingram Micro's third quarter results were negatively affected by the difficult market conditions that are being experienced throughout our industry, including intense competitive pricing and increased reductions in vendor rebates and incentives, primarily in the United States," said Jerre Stead, Ingram chairman and CEO. But Stead, like the rest of the industry, remained upbeat that this slowdown in profit was only temporary. "Despite these short-term issues, Ingram Micro continues to be well-positioned strategically," he said. "We continue to experience solid demand for our core products and services and pursue emerging opportunities in areas such as logistics outsourcing for our business partners." ®
Linda Harrison, 29 Oct 1999
The Register breaking news

Gates announces Generation I – run for it, kids

Bill Gates received a gong from the New York Institute of Technology yesterday, but before he could pick it up, he had to make a speech. The content was very revealing. There was of course the usual re-writing of history ("The PC era started 25 years ago. That's when the first microprocessor chip came from Intel. That's when Microsoft was founded by myself and Paul Allen...") This egotistical desire to claim that he founded the new era ignores the earlier 1971 Kenbak, which used logic chips, as well as the 1973 French Micral and the Scelbi that used the Intel 8008. Some 10,000 construction kits for the 8008-based Mark-8 were sold in 1974. But let not facts get in the way. Gates announced that PC sales would "continue to grow as the cost of the hardware and the cost of the communications come down." So now we know: the cost of software from Microsoft won't be coming down. The revelations became scary when Gates said that "If we look at schools, we're [i.e. Microsoft is] going to have to play the primary role in getting this technology [Internet access via PCs] out to kids." He clearly believes that Microsoft will be the major provider of the OS, the browser, and have control of the formal learning content. Referring to children born from 1994 onwards, Gates said: "I would propose today that we think about this as calling this 'Generation I'. Of course "I" for Internet." From the plans he revealed of Microsoft's steps to dominate content, it might be better to read the "I" as being for "indoctrinated". But there's more: "When you pull information together, you don't have to worry about writing it down on paper. You'll be able to go to the Internet and submit your homework that way." In other words, Gates' plans will lead to another "I" - "illiteracy", since his vision excludes learning to write, it would appear. And so far as reading is concerned, people will be cosying up to flat panel screens, he repeated. The event was an opportunity for the consummate salesman to debut the next edition of Encarta. Gates bragged how Encarta had meant "paper encyclopaedias have gone down in sales a little bit" which is a curious way to note the near-bankruptcy of scholarly encyclopaedias that Microsoft had caused. When making the award of the president's medal, NYIT president Matthew Schure summed it up admirably: "Bill Gates was an obvious choice. Through his innovative genius, competitive drive, and commitment to providing access to information for all mankind, he has changed the way our nation and the world thinks, works and acts each day. For that we salute him." We don't know if Gates has been asked for a contribution by the NYIT, but they have earned one. ®
Graham Lea, 29 Oct 1999
The Register breaking news

US ISP blocks all UK email

There are fears that a tit-for-tat transatlantic Net war could break out after a US ISP blocked all email bearing a .co.uk address. A New Jersey ISP, IDT, took the summary action last week after receiving spam which it traced to Leeds University. Not just content with blocking the source of the spam from Leeds University, IDT went one step further and barred email from a whole nation. An IDT technician told New Scientist that the action was taken in response to "massive spamming" of "pornographic material." But a spokeswoman for Leeds University said that the allegation concerning the distribution of porn was simply untrue. She explained that someone outside the university had breached mail server security before sending the offending spam about a get-rich-quick scheme. The security hole has now been fixed, she said before criticising the way IDT handled the whole affair. "We have no record of receiving any complaints from IDT," she said. "It would have been nice if IDT had had the courtesy to contact us first." Omar Shabka, a director at London-based ISP Bibliotech, which is currently pursuing spammers through the courts in the US, said: "I hope no reprisals come from this action. To block an entire nation is short-sighted and not quite in keeping with what the Net is all about." And he warned that IDT might come to regret its action if spammers decide to target the ISP in the hope it will take similar blocking action against other countries. Indeed, if IDT took the same high-handed manner with all spam, it may as well close down its operation right now and cease trading. For there's no way it could continue carrying mail generated from .com domains since this is where most of the world's porn originates. If it doesn't, it could be accused of hypocrisy and having double standards. No one from IDT was available for comment by press time. ®
Tim Richardson, 29 Oct 1999
The Register breaking news

MS consumer group: your executive departures tonight

The turnover of executives at Microsoft's consumer and commerce group continues. Pete Higgins pulled the plug about a year ago; Peter Neupert - who did much to bolster Microsoft's new media efforts - went last year; Brad Silverberg is leaving today, and now it's the turn of Rob Bennett, director of marketing for the consumer unit. He has left to join encoding.com as director of product marketing. There can be little doubt that the internal pressure to make the group he leaves profitable and world-leading is very strong, but it remains a tough area in which to work for such a demanding company. Microsoft probably now regrets that it is not charging for IE. Bennett worked recently as co-director with Yusuf Mehdi (who achieved some notoriety during the trial on a videotape), and was previously on various Windows and IE products. He took the flack when the Windows 98 serial number (the Globally Unique Identifier, GUID) scandal erupted. Although Microsoft denied that it used the GUID for marketing purposes, it was difficult to see why the undocumented serial number should be tattooed on a document. Bennett said of it, "If it's a bug, and it looks like it is, we'll fix it." which wasn't very credible. The more logical explanation - that it was part of a copy protection scheme - was denied by Bennett. After massive pressure about privacy concerns from users, Microsoft said it would delete the facility. Meanwhile Silverberg said yesterday in an interview with CNET that he hadn't been on paid leave for all this time, but was employed part-time. He has decided to be active with mentoring and funding startups. He denied that he went on sabbatical after Jim Allchin was given control of IE development, and noted that Allchin was given control of IE seven months after he went walkabout. Who will be next to leave, we wonder... ®
Graham Lea, 29 Oct 1999
The Register breaking news

Data-loss lawsuit costs Toshiba $1bn

A lawsuit in the US over faults in Toshiba laptops has cost the vendor $1 billion. Toshiba was being sued over the floppy drive controllers (FDC) in its portable PCs in the Federal Court in Texas. Two owners of Toshiba notebooks alleged that a fault in the microcode for the disk controller: "May, under certain circumstances, cause data to be lost or corrupted as it is written to the floppy disk," Toshiba said. The two customers had asked for compensation for breach of warranty and other liabilities. Toshiba said it decided to settle the lawsuit to limit the amount of compensation a trial by jury could award. It added: "Toshiba wants to ensure its customers that the Toshiba brand name merits their trust." The Japanese manufacturer maintained that it had done so without admitting liability or that its notebooks had any technical problems or defects. Toshiba will fit its notebooks in the US with new FDCs from 8 November. Existing customers will get a software patch, "hardware solution", or cash refund. The company also revised its forecast, announced three days ago, for the current fiscal year ending 31 March 2000. It will incur an extraordinary loss of 110 billion yen ($1 billion) in connection with the settlement. This will raise its net loss forecast for the year to 50 billion yen. The settlement was said to affect six million notebooks which Toshiba had shipped in the U.S. since 1985. ®
Linda Harrison, 29 Oct 1999
The Register breaking news

MS makes Dow Jones eat ‘breakup clause’ story

In a rare victory Microsoft seems to have Dow Jones Newswire on the floor in tears, and has extracted a grovelling apology and correction. Dow Jones had reported that new Microsoft contracts, apparently drawn up with the possibility of Judge Jackson deciding to smash the company into little pieces in mind, covered for the eventuality. Defeatist lawyering? Well no, because the contracts don't seem to have been anything of the kind. The contracts, in fact, as Dow Jones whimperingly admitted yesterday, weren't even one contract. And the clause wasn't even a clause. Nor was it inserted by Microsoft's lawyers. It was, er, included in a draft contract between Microsoft and, er, Dow Jones. The whole thing would be even funnier if The Register hadn't followed up the original Dow Jones story as well, but in mitigation we plead that it was a damn convincing one. The Dow Jones apology* doesn't specify the origin of the clause, but a gleeful Microsoft shows no mercy. Microsoft says that Dow Jones attorneys inserted the clause in the draft, and that Microsoft attorneys promptly chopped it out again. Swelling up to full Redmond Poison Toad size, Microsoft's statement thunders: "In addition, the fact that a draft legal document being negotiated between Microsoft and Dow Jones was apparently shared between the Dow Jones business and news divisions raises serious potential ethical and professional issues." Well content/archive/84-doody, there would appear to be evidence of a shocking breach of trust somewhere along the line. The Dow Jones correction says that the "Microsoft Contract Story Had Substantial Errors." But that doesn't really give you the full flavour of the original. It begins: "This time, Microsoft's lawyers may have gone too far." Then it explains the new clause, and gets an antitrust attorney to surmise that "it reflects careful lawyering on their part, but it reflects a recognition that certain things are in the realm of possibility." Scene nicely set, right? Then we get the Microsoft denial of knowledge of the clause, then (and this is one of the oldest gags in the book) the Redmond spokesperson is induced to speculate that Microsoft's business partners may have requested it.** The anonymous spokesperson is no doubt currently being dragged by the heels back and forth along Microsoft Way. But yes, then we have sign-off. Attorney Paul DeStafano is then quoted as saying that "clients of his were put at ease by [the clause's] presence." So there you have it. The original story puts Microsoft's lawyers in the frame from the off, then gets a plausible explanation from another source who was probably just commenting on what he heard from the reporter, nails the MS PR flack, then tacitly suggests this is a new standard contract by getting another attorney to effectively suggest that a number of his clients are participating in such contracts. We fear the reporter may be being dragged behind a chariot as well... * As Dow Jones has apologised, we should too. We're sorry, the story was wrong, but it was all Dow Jones' fault, OK? ** Register tip for PR spinmeisters: Sooner or later, some goddam journalist is going to phone you up claiming something you've never heard about but that is deeply damaging is now in the public domain, and is going to be plastered all over the papers unless you do something about it now. In the UK the classic example is Daily Mail vs Hackney Council press office, where the mug in the latter was persuaded to try to explain the new (and entirely imaginary) Hackney schools anti-racist policy which involved changing the nursery rhyme words to: "Ba, ba green sheep, have you any wool?" Explanation is confirmation - don't go down that road, spinmeister. ®
John Lettice, 29 Oct 1999