3rd > July > 2002 Archive

Two London PC refurb charity appeals

BLITZ (Blackwall IT Zone) has been set up to enable the local community to have access to IT and the internet, Chris Pearman writes. Although on the doorstep of the Canary Wharf Complex, this is one of the poorest areas of London, with the 7th highest unemployment rate in the UK. We aim to provide second user systems and advice to local groups and individuals in need. We also hope, with the help of outreach workers, to provide IT access to socially excluded groups. Systems that are beyond repair or refurbishment will be disposed of safely & sensibly. Surplus machines would be sold on to make the project a self sustaining social enterprise. However, since we are a not-for-profit project, a percentage of surplus systems could find their way to projects such as computer aid. By opening a recycle IT centre in Blackwall we also aim to provide training and employment for members of our community. CHRIS PEARMAN on 020 7515 5328 or chris.pearman@blackwall-community.co.uk Businesses are being urged to donate their old redundant computers to London schools, Tim Richardson writes The scheme - Access IT! - is run by charities and business organisations and backed by the Duke of Westminster (that's one of Britain's richest men, not the pub). Gear handed to Access IT! is refurbished and refitted with a new mouse and keyboard before being loaded with re-licensed Windows software. Machines are also made Internet ready for use in schools. Said the Duke in a statement: "Through this initiative equipment which would either be scrapped or left to collect dust can be put to good use in the education of London's children now." So far London businesses have donated more than 5,000 computers, which have been bought by 220 schools. Refurbed PCs cost £95 each. For further info go here.
Drew Cullen, 03 Jul 2002

Pre-paid users to fuel m-commerce

Pre-paid mobile phone users will be critical to the success of the emerging m-commerce mobile data market, according to a new report by Analysys, Ciaran Buckley writes. The report, "Enabling Prepaid Mobile Content and Data Services: Strategies for Operators and Vendors," argues that the 170 million customers currently on pre-paid packages across Western Europe are in danger of being ignored by mobile operators. Despite the dominance of pre-paid users in terms of customer numbers, most operators have only made advanced services, such as multimedia messaging and entertainment services, available to their contract customers. "Pre-paid customers already account for 63 percent of active mobile users in Western Europe, and despite operator efforts to convert them to contract subscriptions [they] will remain a substantial segment of the mobile market for at least the next five years," said lead author Emily Turnbull. GPRS and UMTS are new-generation mobile phone standards that allow greater data volumes through the mobile networks. These standards are expected to popularise mobile commerce by facilitating the sale of content through mobile networks. A 2001 report by Frost and Sullivan found that although up to 80 percent of some mobile phone operators' customers are pre-paid, they generate only 20 percent of revenues. For this reason, many operators have attempted to nudge pre-paid users into contracts by reducing subsidies on their pre-paid phones, by charging extra for calls and by raising the minimum credit threshold for pre-paid customers. Speaking to ElectricNews.Net, Turnbull warned that attempts by operators to force pre-paid customers into contracts by excluding them from next-generation phone services may make customers take their business elsewhere, to operators who are prepared to offer parity of service. If operators make next-generation services available to pre-paid customers by early 2003, Analysys estimates that residential pre-paid users could generate EUR16 billion in GPRS and UMTS non-voice service revenue by 2007. Because many young people are pre-paid customers, they could also be early adopters of shopping by mobile phone, which would generate significant revenues for the operators, as well as the content providers. "My feeling is that operators need to launch new services simultaneously for pre-paid and billing customers," said Jack McDonnell, director of marketing and business development at Altamedius, a company whose software powers micro-payment services for operators like Vodafone. "That's the ideal. I don't know that it's technically possible yet." McDonnell believes that the technical problems lie in the limitations of operators' billing systems, which currently use complicated rating rules to facilitate content charges that are bundled with airtime charges. Under the current technology, content charges can only be charged to the user's pre-paid or post-paid mobile phone account. McDonnell believes that in the long-term, operators will have to allow content providers to set their own charges for content, while charging separately for airtime. Operators are also expected to give the option to have content billed either to the consumer's phone bill or to a credit card. © ENN. All rights reserved.
ElectricNews.net, 03 Jul 2002

Directories in the news

After years in the wilderness, it seems that the time is ripe for an interest in directory technology. There is no doubt that the rise of Internet and web services technologies is contributing to this. Now it seems to be the 'must have' infrastructure, and IBM and Critical Path are pushing out new initiatives. The important move is IBM's acquisition of Metamerge. This is a metadirectory solution that enables the integration of multiple individual directories into a single managed view. This is almost mandatory nowadays because, even though most packaged products come with an LDAP-enabled directory for user and resource controls, the information held in directories is rarely shared with other business applications. Metamerge is a Norwegian business that has developed extensive experience of the use of directories in business integration projects. This is what IBM has bought into as it looks to enhance its web services position. It already has directory technology that is used within Tivoli and other product ranges. The metadirectory will bring another layer of integration across its four major ranges - Tivoli, WebSphere, DB2, Lotus. Web services initiatives are also making demands of directory technology and this is where the Critical Path announcement comes into the picture. Its new releases of CP Directory 4.1 and CP Meta-Directory Server 3.3 are designed to create a unified fault tolerant environment that will support web services solutions. This is aimed specifically at the problem of single sign-on and user provisioning within large-scale web services environments. Directory technology is big news right now. All of the big names in web services are realising that they need it to deliver on the evolving standards but they are also finding that it provides useful spin-off opportunities in the areas of management and control of the IT environment. It's not enough on its own, however, to have a single central view of the IT infrastructure. Things don't work that way and most businesses end up with a variety of different directories associated with various parts of the overall solution. To solve this, there is a need for metadirectories that will allow data to be synchronised and managed across the whole lot. Metadirectory will allow a record to be changed in one location and be propagated across all other instances to create a consistent view of the information. This is the reason why those that have directory technology are now looking beyond to the metadirectory concept - a concept that will become the norm before too long and will force us to drop the 'meta' tag. © IT-Analysis.com.
IT-Analysis, 03 Jul 2002

EDS-WorldCom deal highlights outsourcing risks

EDS Corp yesterday outlined the current state of its relationship with embattled communications provider WorldCom Inc, amid growing scrutiny over the risks and accounting practices involved in large, long-term deals. Meanwhile, the world's second largest services firm also announced that it had pulled out of the bidding for a potential $1bn-a-year outsourcing contract with consumer product goods manufacturing giant Procter & Gamble. Concern over how Plano, Texas-based EDS and other major outsourcing providers report costs and revenue from major deals has grown since WorldCom, a major EDS client, said it had incorrectly booked $3.8bn of capital expenditure over the last five years. EDS's share price has fallen by 35% since WorldCom disclosed its accounting irregularities last week, with rival outsourcing providers IBM Corp and Computer Sciences Corp suffering respective 6% and 13% falls in their share prices in trading yesterday. Giving its first update on its $6.4bn, 11-year contract with WorldCom since the scandal was revealed, EDS said it had booked about $150m in WorldCom revenue at June 30 for which it hadn't been paid, including some $60m that hadn't yet been billed. In a parallel contract, WorldCom is EDS's main supplier of telecom services to its clients, but EDS added that it would struggle to meet its obligations to WorldCom of paying it around $600m per year in light of the current controversy. EDS accounts for revenue and profit from its contracts using the percentage-of-completion method, whereby it books some revenue before it is billed, and spreads some expenses out during several years. By structuring deals in this way, it avoids being hit by big losses in the early years of the contract when the costs are increased through the purchase of the client's assets. Equally, it does not make lopsided gains in the later years of the contract. EDS had been in the running to win the contract with Procter & Gamble since it was first put out to tender at the end of last year, but said in a statement that its decision was related to the price the client wanted for the "intangibles associated with the business assets." Dallas-based outsourcing provider Affiliated Computer Services Inc said it was still bidding for the deal, which will see P&G outsource its computer systems as well as back-office functions including human resources, accounting and payroll. © ComputerWire
ComputerWire, 03 Jul 2002

Help us make it through the night – Worldcom CEO

WorldCom Inc believes its pivotal role in the US's communications infrastructure and its bankers' self interest will help it to stave off the threat of bankruptcy. At least that was the impression created by CEO John Sidgmore yesterday at the company's first full scale press conference since the company last week revealed accounting irregularities to the tune of $3.8bn. Sidgmore also dropped more hints as to which businesses the Clinton, Mississippi-based company will consider offloading, and sought to reassure investors that as long as it secures further credit lines and no more unexpected earthquakes hit the telecoms market, it should be able to restructure in a relatively orderly manner. Sidgmore admitted he could not say "we're not going to wind up in bankruptcy at some point." Even before last week's disclosures, the company was negotiating new credit lines with its banks. However, he said yesterday the company was talking to its bankers, and he was confident that it would have two proposals by the end of this week, even if these are "not necessarily the right proposals". Assuming the company did work out a deal with the banks, said Sidgmore, combined with its $2bn cash on hand, the company could "make it through". The only caveat, apart from catastrophic unseen events, said Sidgmore, was if customers changed their paying behavior, and vendors and suppliers started demanding the company pay them upfront. Sidgmore said it was unlikely that the banks would not throw the company a lifeline. He said it was common knowledge that banks would come off worse if they allowed the firm to slide into bankruptcy, than if they helped it survive. He said the first payment that could be "problematic" was a $2bn payment on its bonds due early next year. As well as appealing to bankers' self interest in keeping the company afloat, Sidgmore also suggested it was in the US national interest not to let WorldCom collapse. He said the company handled half of the internet's traffic, and 70% of US email. The company has significant contracts with the US government, including the military. He said that he had spoken to the chairman of the FCC, Michael Powell, who had voiced his support for keeping WorldCom's services up and running. At the same time, he admitted, Powell had not made any commitments that would help WorldCom out of its current predicament. All the same, said Sidgmore, there was "very little chance" of a blip in service. While customers were understandably uneasy, said Sidgmore, the company was working hard to make them feel more comfortable about its future. While senior management were talking to nervous major customers, no one had bailed out on WorldCom yet. The company has already committed itself to getting out of the wireless business, and is in the process of shedding around 17,000 workers. Sidgmore said further sales were obviously an option. He hinted the company could scale back its operations in Japan, saying that while it needed a global presence there, it was "not 100% clear we have to be an intra-Japanese carrier." He said it had a lot of real estate to offload. Newark, New Jersey-based carrier IDT Corp has already said it is preparing a bid for WorldCom's MFS Network and Brooks Fiber Inc, and for its consumer and small business long-distance telephone business. The company valued its offer at $5bn. If the market deteriorated and dented its efforts to become cash flow positive, Sidgmore said "more adjustments" may be necessary. Sidgmore once again voiced his and the firm's shock and outrage over the accounting irregularities that landed the company in its current mess. He strove to make it clear that it was a previous management regime that had presided over the irregularities, and added that it was the company's internal staff, not outside auditors, who had first spotted the problems. Former CFO Scott Sullivan has already been terminated from the firm. Asked if former CEO Bernie Ebbers had known of the irregularities, Sidgmore said: "We really have no idea." Meanwhile, the company has requested a hearing before the Nasdaq Listing Qualifications Panel, to respond to the exchange's move to delist the company. © Computerwire
ComputerWire, 03 Jul 2002

US tax payers shovel $10m into Cray R&D

Cray Inc, the Seattle, Washington supercomputing maker, announced this week that the U.S government has ponied up $10m to fund half of the development costs of future supercomputers based on the SV design, Timothy Prickett Morgan writes. As part of the agreement, Cray has agreed to set aside an equal $10m for the research and development of the SV family of vector supercomputers. The SV2 supercomputers designed by Cray (which was eaten in April 2000 by Tera Computer after being spun out of Silicon Graphics) are one of the key pillars of national security in an increasingly spooky and paranoid world. In September 1999, Uncle Sam cut a check for an unspecified amount of development support for the SV2s, when Cray was still a unit of SGI, to make sure that the machine came to market. The government has been a big user of vector-based supercomputers - particularly at the National Security Agency, the Central Intelligence Agency, and the various branches of the military - and it looks as though the U.S. government wants to ensure that at least one domestic supplier of parallel vector supercomputers is always around to support its vector application needs. Cray's statements on the deal would have us believe that Cray alone is dedicated to developing high-bandwidth, high-performance supercomputers and that is why Uncle Sam is paying $10m in development for future SV-style machines, but this is silly. IBM Corp, Hewlett Packard Co, SGI, and Sun Microsystems (to a certain extent) are committed to the HPC market and sure want to get a bite out of the ballooning military and intelligence budgets in the States. What Cray has and these companies do not are vector-style machines rather than massively parallel machines, and that means they run certain workloads better than can be done on parallel computers. The U.S. government wants a variety of styles and architectures in indigenous supercomputers because that is what the workloads among its research institutions, its military branches, and its intelligence branches require. IBM, HP, Sun and to a certain extent SGI do not need development money from the U.S. government because they have very large general purpose server businesses on which they can shoulder the costs of parallel supercomputer development. Cray doesn't have this, and this is why it needs Uncle Sam to pay forward on the machines it will want to buy years from now. None of this detracts from the importance of keeping Cray in business as a supercomputer vendor so there is an alternative to the parallel designs from other suppliers. This deal just illustrates that Cray has to be cultivated and tended in a more conscious manner than a free and brutal market might otherwise allow. The SV line of vector machines have been around for almost three years. The SV1, SV1ex, and SV2 supers uses a mix of standard vector processors plus virtual vector processors, called Multi-Streaming Processors (MSPs). The SV1 line was launched by Cray when it was part of SGI in September 1999. Cray delivered the SV1ex line in the first quarter of 2001, using vector processors running at 450MHz, up from 300MHz with the SV1s. The SV1 and SV1ex machines couple four CMOS processors together to create an MSP, which together are rated at a 7.2 gigaflops peak performance. In real world settings running vector programs, it comes in at between 3.6 gigaflops and 4.5 gigaflops, says Cray. The SV2s, which are expected later this year, are expected to have CMOS vector engines with about 3 gigaflops of power. James Rottsolk, Cray's chairman and CEO, says that the $20m in funds will be used to enhance the processors and memory subsystems in the existing SV2 machines and to develop a successor to the SV2 that includes vector registers, distributed shared memory, higher memory bandwidth, stride-independent memory bandwidth (in short, this seems to mean improving how caches work with the processor), adding instruction-level parallelism to the SV processors, and making the overall machines burn less electricity and generate less heat. Rottsolk that the SV2 can hit about 150 teraflops of peak performance with more research and development, up from about 50 teraflops of peak performance with the machines expected later this year. This is the first time Cray has put a number on the peak performance of a fully loaded SV2, something the company has been hinting at but not committing to. Cray has not released any configuration details on the SV2 machines, but a machine with 4,096 MSPs, each delivering 12 gigaflops of power, yields 49 teraflops of aggregate peak processing capacity. In any event, the nearly 50 teraflops rating Cray is saying it can deliver with the SV2 puts the machine, in theory, ahead of the world's current most powerful supercomputer, NEC's Earth Simulator, which has 5,120 vector engines that collectively deliver around 40 teraflops peak computing power. Rottsolk says that with continued funding, the SV2 successor could handle several hundred teraflops and during its lifecycle should exceed one petaflop of peak power. The announcement that Cray had received development funding from the U.S. government on the SV line of vector supers came hot on the heels of an announcement two weeks ago by Cray that it had been able to get in on the "Red Storm" 100 teraflops massively parallel supercomputer project being sponsored by the U.S. National Nuclear Security Administration, a division of the Department of Energy that helps fund the Sandia National Laboratories. Sandia is said to be working out the finishing touches on a $90m contract with Cray to build such a machine, and already has a contract with Compaq Computer Corp from January 2001 along with Celera Genomics to build a 100 teraflops machine under the Red Storm supercomputer program. The Cray deal is an alternative supply contract, and this is consistent with the past practices of the U.S. government, which wants to foster innovation and competition among indigenous supercomputer suppliers. Cray has also recently been awarded a one-year, $3.6m grant by the Defense Advanced Research Projects Agency's High Productivity Computing Systems program, which is asking the major supercomputer makers in the U.S. to come up with ideas about how to build the multi-petaflops supercomputers that the U.S. government will want to have in its arsenal in the 2009 to 2010 timeframe. IBM, Sun, and SGI were awarded similar contracts. © ComputerWire
ComputerWire, 03 Jul 2002

Public WLAN in Europe – $1.8bn in 2007

Europe will be home to 7.7 million public access wireless local area network (PWLAN) service subscribers by 2007, when service revenue will reach $1.8bn, according to Yankee Group Europe. In its new report "Public Access WLAN in Europe: A Technology in Search of a Business Case?" Yankee group said WLAN technology is now "relatively mature" and "widely deployed" among European enterprises, providing a base of Wi-Fi-enabled laptops users for prospective PWLAN operators. However, Yankee also warned that the PWLAN sector's success is by no means guaranteed. Much will depend on the service models adopted by early entrants, and on the industry's ability to address lingering technology barriers, including support for PWLAN roaming, security and the provision of suitably flexible billing regimes. Although Yankee is broadly positive about the future of PWLAN in Europe, the company said it does not subscribe to the predictions of rival market analysts, who have warned that PWLAN poses a threat to future 3G revenue. Instead Yankee urged the mobile network operator (MNO) community "to grasp the PWLAN opportunity immediately, and to leverage their formidable position of strength in mobile services and customer ownership to grasp to secure a dominant role in the provision of PWLAN services." © ComputerWire
ComputerWire, 03 Jul 2002

AltaVista upgrades search engine

AltaVista Co yesterday unveiled a handful of upgrades to its web search engine to compete in an increasingly competitive market where it has lost much of its early lead. The company, a CMGI Inc subsidiary, introduced Prisma, a feature that allows users to drill down into related terms to refine their search queries. The Palo Alto, California-based company said Prisma searches the top 50 sites returned for any given query to find the top 12 related terms. A search for "Buffy", brings back "Vampire Slayer" and "Fan Fiction", for example. Clicking on one of the terms adds that term to the original query and presents more refined results. Prisma looks a little like core features from emerging rivals such as Teoma (part of Ask Jeeves Inc) and WiseNut (part of LookSmart Ltd), though in a random sampling AltaVista's drilldown options seemed to be more useful than the competition's, which use convoluted link analysis to find related words and occasionally bring back garbage. In addition, AltaVista's feature has a secondary option that allows the related search to replace the original query with one click. So users searching for "Apple" may find the related term "Macintosh" more useful a query. Prisma offers two levels of drilldown before a user has to click on a link. A further upgrade involves the automatic inference of the AND operand in searches involving more than one keyword. Previously, a user may have had to specify they wanted to see "Britney AND music" to avoid getting pages that contained the term "music" but not "Britney". It's arguable that the company has neglected its web search engine - once regarded as the best on the web - over the last couple of years, as it focused on its enterprise software division in the face of the dot-com bust and extensive restructuring. Prisma looks a little like catch-up, and offers little that was not already possible with AltaVista's featured but complex Boolean search feature, which has yet to be bettered. AltaVista also announced yesterday that it has increased the size of its index to 1.1 billion items. This is a little less than half the size of the leading search engines. Google claims 2.07 billion items, and Fast Search & Transfer ASA's AllTheWeb.com claims 2.09 billion pages. AltaVista says its multimedia index has 140 million images, videos and image files in it, compared to Google's 330 million images. In related news yesterday, AltaVista competitor Google Inc announced that AT&T Corp has selected its web search service to feature prominently on the portal associated with its WorldNet consumer internet access service. As with similar recent deals, Google has also sold its paid-position sponsored links service into the account. Google counts Yahoo, AOL and EarthLink among its clients. © ComputerWire
ComputerWire, 03 Jul 2002

IBM sells off more storage biz (to LSI Logic)

IBM is continuing its flight from the storage component business by selling its Mylex business unit, which makes RAID controllers, to chipmaker LSI Logic Corp. The move marks an expansion for LSI downmarket into the market for NT RAID storage. Terms of the deal, which is expected to close in the third quarter were not disclosed. IBM bought Mylex in 1999 for $240m, and will hand to LSI a business unit with an established dealer network, and OEM relationships with IBM, NEC, Fujitsu-Siemens, Xyratex and Eurologic. Mylex sells both internal and external RAID controllers, and its internal RAID controllers will overlap with similar products LSI already develops. LSI said yesterday however that the purchase had been made primarily because of Mylex' external controller business. Mylex was part of the microelectronics business of IBM's technology group. That microelectronics organization last month announced the lay-off of 1,000 staff or 5% of its total workforce, and said it was focusing on three activities - ASIC manufacture, the operation of high-end chip foundries, and PowerPC products. "Storage controller products are not core business for Microlectronics," an IBM spokesman said. IBM yesterday announced the sale of its Endicott, New York-based chip packaging business to a privately funded group of former IBM executives. In April, IBM sold off its HDD business to Hitachi Data Systems for a rumored and unconfirmed price of around $1bn. Mylex has around 290 employees, around 100 of which will transfer to LSI's subsidiary Logic Storage Systems Inc, which makes complete storage systems and will take on the external controller side of Mylex's business. The remaining staff, involved with internal controllers, will transfer to the part of the LSI Logic parent company which makes storage components. There will be an overlap between LSI's internal controllers, and the internal controller business which LSI bought from American Megatrends Inc - AMI - last year. No decision has been made about the future of either set of products, said Flavio Santoni, vice president of sales and market for LSI Storage Systems. "I think it's fair to say the primary focus of the deal was the external RAID business," Santoni said. According to Santoni, the purchase will bring his organization the sales channel and staff needed to explore new business. "We see developments in the low end of the storage market, and we see a lot of value in modular systems," he said. Santoni estimated that Mylex has "a good sized business in the NT space.....not many companies can attack the market with a distribution channel like theirs," and said that Mylex' RAID controllers slot in below LSI's existing Unix-based external controllers. LSI Logic Storage Systems does most of its business selling storage boxes which are relabeled by suppliers such as IBM, Sun, Compaq and HP. It suffered badly in the overall storage market downturn last year. While overall revenues fell by around 18%, LSI Storage Systems saw its revenues almost halved, to $211m. Santoni insisted its revenues are growing again. For its first quarter this year, the organization saw a revenue of $59.9m, up from $52.4m in the previous quarter, but down on the $62.2m seen in the first quarter last year. The parent company LSI Logic itself posted a pro forma net loss of $74m on heavily reduced revenue of $1.8bn in 2001, down from a pro forma profit of $116m and revenue of $2.7bn in 2000. However it ended 2001 with over $1bn in cash and short-term investments. © ComputerWire
ComputerWire, 03 Jul 2002

Deitel duo tame enormous Python

Yes, it's herpetological puns all the way this week from Reg associate IT-minds.com. This week's featured creature, sunning itself lazily on the discount rock is the Deitels' Complete Python Training Course The beast measures up thus: There's never been a more powerful, effective way to master Python programming. This hands-on, interactive training course combines The Python Multimedia Cyber Classroom and the book Python How to Program. It delivers 12 full hours of audio, hands-on exercises, and 14,931 lines of fully functional program code, taking you from the fundamentals to sophisticated Web and enterprise development. Start with basic syntax, control structures, and functions; then master object-oriented programming techniques; Web CGIs; GUIs; exception handling; string manipulation; and regular expressions. Coverage also includes: XML, DB-API database access, multithreading, data structures, security, PSP, and more. You'll find hundreds of tips for maximizing performance, interoperability, reusability, and reliability. Test yourself with interactive review questions and programming exercises, and get fast, in-depth answers from your searchable e-book. Normal price £87.99 but yours for just £61.59 - a massive saving of 30 per cent. Other inhabitants of the IT-minds.com vivarium at 30 per cent discount this week include: Linux Cluster Architecture STY Apache in 24 Hours Spatial Databases: A Tour STY ADO.NET in 21 Days Photoshop Type Effects Encyclopedia A Programmer's Guide to .NET Sun Certification Training Guide UNIX Fault Management .NET Framework Security And, as ever, Reg readers can get all other titles in the IT-minds bookstore at a 20 per cent discount. ®
Lester Haines, 03 Jul 2002

Motorola axes (another) 7,000

Motorola Inc is to cut its workforce by a further 7,000 in a move that it hopes will complete the restructuring of a company desperate to claw its way back to profitability after badly losing its way. The short-term effect however will be to plunge it deeper into the red as it expects to record a special charge of $3.5bn, mainly in the second quarter, for reorganization and asset write-downs. "What we're doing here is taking the company back to about its 1995 size, before the era of the excesses of the dot-com and telecom booms," said chairman and CEO Christopher Galvin. Though the Schaumburg, Illinois-based company has cut its workforce from a peak of 150,000 in August 2000, it cannot expect a quick upturn this year to pick up the slack with sales down 22% in the first quarter. It is placing great emphasis on an "asset light" semiconductor business model, with production outsourced to Taiwan Semiconductor Manufacturing Co Ltd. So much of the $1.1bn it will record in lower market valuations of its assets will be in relation to its fab plants, but it expects lower investment costs in future. The latest round of job cuts will cost around $1.9bn in a reorganization that it said will hit all business segments and corporate headquarters operations. It claims that lower manufacturing, R&D costs and general expenses will save $100m in the remainder of the current year and provide savings of $700m. Motorola is sticking by a forecast of a 5% to 10% decline in sales this year and expects to show a profit for the third and fourth quarters, and for the full year. This will however be before the special items totalling $3.5bn, though only 20% of this will be cash related. Though Motorola and Nokia remain in a legal tussle with Turkish mobile operator Telsim, it plans to write off the $530m it is owed by the company. © ComputerWire
ComputerWire, 03 Jul 2002

IBM gains UK server share

It has certainly been a tough 12 months for server companies in the UK. Between the start of Q2 2000 and the end of Q1 2001, some $3.55 billion worth of servers were sold in the UK, according to IDC research. For the same period just a year later, ending Q1 2002, that figure had fallen to $2.49 billion, a decline of 29.5 per cent. Recession-induced spending restrictions and dotcom failures have taken their toll, most notably among the best known vendors, IBM, Compaq, HP, Sun and Dell. These companies - five then, four now - define the UK server market, controlling more than 90.4 per cent of the business, up from 88.7 in the Q2 2000 to Q1 2001 period. No wonder then that they should equally suffer some of the biggest losses, with HP, Sun, Compaq and Dell, seeing their revenues slide 38.4, 38.1, 32.9 and 26.9 per cent respectively, exceeded only by minority players Groupe Bull's 52.8 and Unisys' 42.4 per cent sales decline, though these two companies' sales are a fraction of the others'. Of the top-tier companies, IBM did best, declining just 6.3 per cent. It's hard not to imagine Big Blue's big advertising budget playing a part here, not to mention its focus on services as much as hardware sales - IDC's figures measure customer revenues. Clearly the more servers you sell in boom times, the bigger the impact of a downturn, though as the over tier-one and tier-two market share figures show, you're more likely to win the business of those folk who are still buying servers. Other factors hit the top-tier players, primarily the uncertainty surrounding the HP/Compaq merger and the major management changes Sun was at that point steering towards. IBM's first profit warning in 14 years didn't help much, either. One company proved resistant to the downturn: Fujitsu Siemens, which saw server revenues rise 82.7 per cent across the two periods measured by IDC. Fujitsu Siemens itself boasts that it's being viewed as a "credible alternative to some of their more established enterprise technology providers". More likely, its success has come about by its shift to emphasise its higher unit cost and even higher value Solaris-based products - like IBM, it's benefiting from selling more hardware capable of pulling in greater service revenue. And lest Fujitsu Siemens get too cocky, while its European server market share comes in at 9.3 per cent, in the UK, it's less than three per cent of the total. So it has a long way to go before it can be considered at top tier player in the UK. Looking ahead, the signs are positive, says Thomas Meyer, IDC's European Enterprise Server Group Manager. During Q1, the UK accounted for 21 per cent of the servers sold in Europe, up from 20 per cent in the year ago quarter and Q4 2001's 16 per cent. That suggests a something of a turnaround in the UK's fortunes, but Meyer cautions against excessive optimism: annual growth will at best be in one or two per cent, he believes. However, that shouldn't dampen the UK market's desire for new technology, and its adoption of server appliances and blades should continue to exceed the European average. ®
Tony Smith, 03 Jul 2002

Orange network gone titsup

Orange's mobile phone network went on the blink this morning, leaving the trendy operator clutching straws for excuses. Readers who've called Vulture Central say that the outage appears to be country-wide and that it only appears to be hitting contract mobile phone users. However, Orange wouldn't comment on the scope or scale of the problem. In fact, they wouldn't answer any questions except to issue the following statement. "We confirm that a small number of Orange customers are currently unable to make or receive call on the Orange network. Our engineers and those of our network equipment suppliers are working to establish the cause of the fault and will restore service as soon as possible," it said. It also "very much regrets any inconvenience caused". Which is nice. ®
Tim Richardson, 03 Jul 2002

AMD issues sales warning

AMD today warned that it will miss Q2 sales forecasts of $620m to $700m, its second downward revision in a fortnight. It now says it will pull in approx. $600m for the quarter ended June 30, 2002. Which means that its earlier warning of hefty operating loss for the quarter has just got a lot heftier. AMD's warning is bad news for the PC industry (unless Intel is pulling an absolute blinder on the sly): two weeks ago, AMD changed its Q2 forecasts, initially set at $820m to $900m. The chipmaker reports its final results on July 17. ®
Drew Cullen, 03 Jul 2002

Time's Continental Edison deal collapses

Time Computers' proposed takeover of Continental Edison, the leading French PC maker, has collapsed. According to Time, creditors of CE were unwilling to agree takeover terms, necessary to take the deal forward. The UK's biggest system builder expressed "great disappointment - but there are plenty of opportunities we're looking at". Time confirmed it was in talks to buy CE on June 14. Question is: what will, Cofidur, CE's owner, do with the business if it can't find a buyer. A company in which creditors hold such sway does not sound like one in the best of health. Butnow that Time is out of the way, it will probably be in Intel's interests to find or broke a deal with a more Intel-friendly system builder. Time is AMD's second biggest customer in Europe, after Fujitsu Siemens, with 90 per cent of its systems incorporating a AMD chip. Continental Edison is also a strong AMD account, reflecting its status as a consumer PC supplier, but the AMD/Intel mix is more like 60:40. The business is France's third biggest supplier of PCs to retailers, shipping 160,000 units in 2001, according to IDC. ® Related story Time closes in on French market
Drew Cullen, 03 Jul 2002

1901 Census site still down after six months

The farce surrounding the UK's 1901 Census site hit a new milestone this week - it's six months since the site was launch and it still doesn't work. So far the Public Record Office (PRO) has spent £1.2 million of public money on the site but won't commit to say when it will be up and running. When it was launched at the beginning of January it was the first time that the census for England and Wales had been made available online. The flagship project was supposed to give people access to information of some 32 million people who lived in the UK a hundred years ago. But within hours of its launch the site encountered problems denying people access to historical information. At the time, this was described as "teething troubles". Six months on and the site is still down. The technical outfit behind the site, Qinetiq - the new "science and technology powerhouse formed from the...British Government's elite defence research and development organisation" - is continuing to carry out testing and improvements. According to a spokesman, Qinetiq has completed its testing of the site and is happy with its performance. However, the site is now undergoing tests by the PRO which will not give the green light for the re-launch unless convinced it will work. And since the PRO has not given its go-ahead it seems that the PRO is not wholly satisfied that the site will work. A statement on PRO Web site reads: "The PRO apologises for how long the testing has been taking. We are aware that six months have passed since 1901 Census Online was first launched. Both the PRO and Qinetiq Ltd, who are responsible for the technical aspects of the service, are testing the system. The nature of testing is such that it throws up issues that need to be addressed, and on occasion requires tests to be re-done. The primary objective is to ensure that the Web site is sufficiently robust, so that our customers can have a satisfactory experience when they use it. "This has meant that we cannot give precise dates for the return of the service and we do not want to raise expectations by giving deadlines that are not met. We are aware that this has caused much frustration to our customers, frustration which we share, and for which we apologise," it said. ® Related Stories 1901 Census farce runs and runs UK census site stays shut Census site stays offline Census site shuts for a week 1901 Census site closed for urgent repairs Brits flock to1901 census site
Tim Richardson, 03 Jul 2002

Mandrake shuns UnitedLinux

Mandrake won't be joining the UnitedLinux initiative, inspired by Caldera and involving SuSE, and it's said why. In a statement, Mandrake rejects the idea that Linux is 'fragmented' in the way that UNIX failed to achieve common standards in the 1980s. Quite rightly too - the Linux Standards Base project has got further, faster than the various POSIX committees did, and Linux doesn't have the complications of ancestral politics of UNIX™'s dual heritage: AT&T Labs and Berkeley. Mandrake stresses the benefits of competition, and interestingly, points to continuing collaboration with Red Hat. The UnitedLinux initiative allows four smaller distros to cut overheads by pooling their resources, but it's a strictly server-only for now. Mandrake's focus is on the desktop, so it isn't hard to see how Mandrake thinks it loses more than it gains by joining the project at this stage. "MandrakeSoft would gain nothing by joining United Linux, and doing so would damage our reputation," it adds, before pointing out that in volume terms, it's already bigger than the four UnitedLinux members combined. It's not making money, however, but says that it expects to reach break-even by the end of the year. Mandrake's statement is here. ®
Andrew Orlowski, 03 Jul 2002

Orange gets its punters talking again

As many as 635,000 people were hit by the outage that downed the network of colourful mobile phone operator Orange earlier today. Services are returning to normal and full coverage is expected to be restored "in the next couple of hours", so we're told. Orange won't say what the problem was but it claims that at its peak "less than five per cent of customers were affected". Orange has some 12.7 million punters using its network. However, our readers are beginning to give us a picture of what really went on. Said one: "I have two mobiles on the same contract. The current 'small outage' started about 11pm last night leaving one phone doing a rather good impression of a paper weight with the other working fine. Bizarre or what?" No, bizarre. ® Related Story Orange network gone titsup
Tim Richardson, 03 Jul 2002

Nvidia hunts for Euro disties

Nvidia wants to appoint its first disties in Europe - it's waving marketing development funds, training and collateral for companies willing to become Nvidia Authorised Distributors (NADs). The catch is that NADs must commit to sourcing Nvidia product from Europe Nvidia Certified Partners only, 14 board manufacturers in toto, sales director Roy Taylor says. Nvidia-approved board makers commit to building to minimum standards (or better) specified by the chip designer's reference design. "The Far Eastern board makers are good at cutting corners to hit low price points, but we want ensure quality for all our customers. "Right now there's a lack of quality control in distribution, we just haven't talked to the disties, let alone supported them. The result is that they (the disties) are tending to buy Nvidia from almost anyone rather than our certified partners." According to Taylor, Nvidia's 14 authorised board makers in Europe are all recording sales gains, winning market share and fending off the Intel integrated graphics threat. "The integrated threat has not happened," he says. "The add-in board market remains strong." But fact is, the PC market remains crap - look at AMD's sales warning today. And there's only so much market share to be screwed out of the system builders and retail. So that leaves distribution. Taylor reckons there's a big hole in the market, left by the ATI's retreat from selling its own boards in Europe. "We're looking to speak to any distributor who used to sell ATI and now feels disappointed." ®
Drew Cullen, 03 Jul 2002

BT cuffed for broadband ad fib

The Advertising watchdog has mauled BT for a misleading broadband ad. The monster telco claimed that its domestic broadband service was 40 times faster than a traditional dial-up service. This was disputed by Telewest which claimed BT's domestic broadband service was only ten times faster than bog standard Net access. The Advertising Standards Authority (ASA) agreed adding that BT's faster services - up to 2 Mbps - were geared at business users and not home users. In a statement, Telewest said BT had been "caught speeding" with advertising about a domestic Internet service claiming to be 40 times faster than dial-up access when, in reality, it is only up to ten times quicker. Said David Hobday, S&M director at Telewest Broadband: "BT's been caught trying to pull a fast one. Consumers are having a hard enough time getting their heads round broadband, without BT getting its sums wrong." Two other complaints - including one brought by the pressure group Broadband4Britain - concerning broadband coverage in the UK were thrown out by the ASA. ®
Tim Richardson, 03 Jul 2002

Now we are 3 – Hutchison unwraps 3G brand

Hutchison today outted the worldwide name for its 3G mobile phone service - 3. The announcement follows press reports, so there's no logo, or branding statement for philistines like us to sneer at . And there's to be no messing, at the back. "The name should always appear as '3', with the exception of website addresses, where it is written as a word in the relevant language (e.g. www.three.co.uk). Yes, sah! Hutchison is, among other things, to become the UK's fifth mobile phone network, but 3G only, and it is expected to be the first to roll-out 3G services in this country. Press release? Here. ®
Drew Cullen, 03 Jul 2002

HP axes 5,900 jobs in Europe

Hewlett-Packard is to axe 5,900 jobs in Europe as part of a plan to reduce its global workforce by ten per cent over the next 18 months. In total, the company will shed some 15,000 jobs out of a total workforce of 150,000. It did not disclose any further details about the restructuring. In a statement HP said that those employees hit by the job cuts would receive "comprehensive severance arrangements that will include financial compensation and job search placement". HP said that it regretted the jobs cuts, adding that they were necessary to meet cost savings of $3bn a year by 2004. ® Related Story Speedy HP makes cost savings, job cuts
Tim Richardson, 03 Jul 2002

Lloyd Webber web hoaxer unmasked

The identity of the literary hoaxer who made the pages of The New York Times last year can finally be revealed. The prankster posted reviews under the name of "Andrew Lloyd-Webber" - Britain's best-loved composer - on Amazon.com. The publishing giant rapidly removed the reviews. Regular readers can probably already guess the hoaxer's identity. "Other false Lloyd Webber endorsements went to guidebooks on combating halitosis and premature ejaculation," noted the Times. "Lord Lloyd Webber was not available for comment." We can now confirm the author was Henry Raddick, Amazon.com star reviewer and composer of over two hundred erudite contributions to the online book giant's pages. Raddick has featured in Slate, the Online Journalism Review and gained a cult following amongst bloggers. Speaking to The Register last night from a public house in Holborn, London, with his pug Grendel at his side, Raddick confessed to being the author of the "Lloyd-Webber" reviews. We have also able to obtain rare screen shots of the now-deleted Amazon reviews. These, we repeat, were not written by Lord Lloyd Webber. The news could come as a disappointment to Ross Allan, who was naturally "pleasantly surprised" to discover that the knighted composer of Cats, Phantom of the Opera and Evita had given Allan's Dog Obedience Training the personal seal of approval. ® Related Story Henry Raddick - man of letters [our exclusive interview]
Andrew Orlowski, 03 Jul 2002

Fujitsu Siemens, Dell win Inland Revenue 30,000 PC gig

Fujitsu Siemens and Dell have won multi-million pound deals to supply the Inland Revenue with replacement desktop PCs. The agreements are part of the Inland Revenue's ongoing desktop refreshment programme to replace around 30,000 of its desktops over the next 14 months. Fujitsu Siemens Computers and Dell have been chosen to supply the replacement PCs, with Computacenter, the giant reseller, fulfilling the contract in both cases. Fujitsu Siemens Computers will supply around 15,000 SCENIC S small form factor desktop PCs, which feature Pentium 4 processors. Each will be loaded with a standard software image to ease administration. Dell is the nemesis of the channel, unbundling product from services and eating up margins. So why do resellers such as Computacenter help their arch-enemy. This question is posed by Gary Butters, UK corporate sales director of Fujitsu Siemens. Speaking at the firm's channel conference last week, he called on resellers to 'withdraw your labour' from Dell. His arguments are reported in Microscope, the UK's best channel newspaper. ® ®
John Leyden, 03 Jul 2002

Lights go off at eBone

KPNQwest's European network - eBone - is to be shut down as of 17:00 BST today. The closure follows the collapse of a deal to buy the high-speed data network. Engineers starting closing down the network yesterday. Some experts claim that the closure of eBone could slow traffic throughout Europe while the problem settles down. Whatever. Perhaps a minute's silence is in order. ® Related Story Ebone to shut as sale falls through
Tim Richardson, 03 Jul 2002

Extended warranties: are they a con or what?

Dixons is Europe's most profitable computer retailer, and its success in selling extended warranties on computers plays a big part in its success. But extended warranties for electronics goods, touted by all the big retailers, are not popular with consumer rights groups. What is the point of shelling out £200 or more for a five-year contract on a PC which cost maybe £650 in the first place, they argue. Why on earth are people buying warranties for washing machines - cheaper 99 times out of a hundred to pay-as-you-go repairs. Maybe it's high-pressure sales tactics that's 'forcing' punters to buy inappropriate, expensive protection. That's what the Competition Commission intends to find out. Yesterday it received a request from the Office of Fair Trading to examine the market in extended warranties - worth £500m a year - in the UK. Following a nine-month investigation into the business, the OFT concludes that "competition in the market did not appear to be working effectively and that consumers were not adequately informed or protected". And self-regulation doesn't work. Dixons and Kingfisher, the UK's two biggest electronics retailers, are outraged. The OFT has "misdirected itself", the referral's "unjustified"; the market's "highly competitive" etc. etc. There's a lot of huffing and puffing, except from Asda, Wal-Mart's UK sub, which says: "extended warranties simply a marketing ruse designed to dupe customers out of parting with their cash for little or no benefit." That's got it just about right. ® Acknowledgement All quotes are from the FT, which we have stopped linking to since it made stories older than seven days old available only through paid subscription.
Drew Cullen, 03 Jul 2002

British ID cards to revolutionise crime

Home Secretary David Blunkett announced the start of a six month consultation in Parliament today on plans by the government to introduce "entitlement cards" (that's ID cards to you and me). Lobby group Privacy International reckons the proposal for a national identity card has little to do with the government's stated objectives of reducing the threat of crime, terrorism and illegal immigration. Its real purpose is part of a broader objective outlined in the Cabinet Office report "Privacy & Data Sharing" to create a new administrative basis for the linkage of government databases and information systems. But worse, the government's ID card plan could backfire and become a tool for criminal syndicates, according to Privacy International which argues that a national ID card- whether voluntary or mandatory - will compound problems of illegal immigration, fraud and identity theft. The pressure group argues that national identity cards initiatives have no effect on the reduction of crime or fraud, but introduce additional problems of discrimination, criminal false identity and administrative chaos. According to Simon Davies, Privacy International's Director, criminals now have access to technology almost as sophisticated at that used by governments so that "even the most highly secure cards are available as blanks weeks after their introduction. "The ramifications of an ID card conform to the dynamics of the black market economy. Whenever governments attempt to introduce an ID card, it is always based on the aim of eliminating false identity," Davies said. "The higher the stated 'integrity' (infallibility) of a card, the greater is its value to criminals and illegal immigrants. A high-value card attracts substantially larger investment in corruption and counterfeit activity. The equation is simple: higher value ID equals greater criminal activity." The government says a national ID card will combat the growing problem of identity theft, in which a person's identity is fraudulently acquired for criminal purposes. It is a huge problem in the US, made all the worse because of the ubiquitous Social Security Number. Critics of national ID proposals in the US have warned that any central ID number massively increases the incidence of identity theft. Privacy International supports this view, and predicts that any national ID system will increase identity theft in the UK to US proportions. ® Related Stories Biometric passports for Brits - by 2006 ID Cards are good for you Straw slams civil liberties lobby Brits want ID cards, not worried about privacy Make ID cards compulsory, urges Oracle boss
John Leyden, 03 Jul 2002

Zimmermann calls for NAI to free PGP

Phil Zimmermann is calling on Network Associates to open source portions of the PGP encryption program he sold to the security giant in 1997. The suggestion from the author of PGP comes as NAI continues to search for a buyer for the popular desktop encryption program, having decided to cease development work on the product as part of its reorganisation last year. NAI has pledged to honour existing contracts, but the lack bug fixes or updates in the pipeline leaves PGP in a state of limbo. If he had the money, Zimmermann would buy PGP back from NAI but since this isn't possible right now he's suggesting that NAI should open source the software developer's kit and GUI for PGP, while keeping the command line wrapper under wraps. The command line wrapper is a key component of the server version of PGP, which is more popular with corporates. NAI has poured cold water on the open source idea saying it doesn't represent a viable business model for PGP, which Zimmermann disputes. PGP's source code has been available for review since the inception of the program, however this doesn't allow for modified versions of the program to be distributed which an open source program would allow. ® Related Stories PGP dies of neglect - your alternatives How we can save PGP - Zimmermann PGP deep-freezed - NAI shrugs Network Associates puts PGP up for sale
John Leyden, 03 Jul 2002

Musos mull post-Emagic sequencer options

LettersLetters Re: Apple drops Emagic bombshell One thing I noticed reading the Cubase and Logic forums yesterday was how generous the users were with each other. Barely a hint of platform chauvinism. Clearly musicians have the ability to empathize with fellow humans. Because they're using computers as a tool, not an end in itself, I wonder? Quite an interesting postbag from you all, too. Of course no platform chauvinism at all would make for a very dull well. So on with the chau? I wouldn't expect AAPL, in a double-dip Tech recession, to offer much of a break to anyone on anything but stale inventory. But if Delmore Schwartz was right, and "In dreams begin responsibilities", the eustress of big-boy, do-or-die sound and video processing might propel AAPL hardware the way games do on Wintel machines. More eustress on Wintel, PC users win. Best regards, Weldon Shea Monsport Eu-what? The opposite of distress, or positive stress, we think. No Mac announcement is without an accompaniment of wishful thinking. Keep your eyes open Steinberg will be the next to leave the PC platform! Dave Hallock I expect they're throwing the compilers out of the window as you read this, Dave. Another David lists a long sequence (no pun intended) of ISVs who walked away from the Mac platform, and isn't too sympathetic to see the boot on the other foot:- as a longtime mac user, it's really hard for me to summon up much sympathy for these poor wintel users. personally, i'm glad to see apple taking steps to ensure its future wellbeing. if that means a few wintel users have to be inconvenienced, i say so be it. it's not like there isn't a world of other software out there for them. lucky bastards. David Randall Now here's an interesting perspective we haven't seen covered. This goes beyond the details so far uncovered. In March, Emagic acquired distribution of Sek'd Samplitude line of software from Magix (Samplitude Master, Producer, 2496). Samplitude is a Windows-based software so Samplitude users -- who also shelled out upwards of $700 for their software -- are wondering where this leaves them (us.) As I mentioned to a Windows beta tester for Emagic's Logic Audio (who feels "betrayed") I have been on an anti-piracy rampage for years, being a software developer myself. One of the siren songs used by pirates in rationalizing their behavior is this example here: software companies crap on the heads of customers. Unbelievable. Excuse me while I go take a shower. [name supplied] Houston, TX One of many Cakewalk users writes:- There's a whole group of Mac users who believe PC audio products might work but aren't 'serious'. I've been a composer for 35 years, am at the forefront of 'serious' electronic music, and have never used a Mac. I had written my own software up until 1992, and then began using Cakewalk 2 in combination with other software. My commercial 'serious' recordings have been produced with it, and Sonar is now the main audio app on my desktop. It's not just furious Sonar users, it's *serious* furious Sonar users! Dennis Bathory-Kitsz From emagic's perspective, the high-end professional users are nearly all on the Macintosh platform. The Windows/Mac split in the low-end of their product range is nearly the inverse of this. I do wonder what the exact numbers are for this, but the revenues are surely not split 65/35 because of this weighting. Additionally, the vast majority of the pirated software users are said to be on the Windows platform. By cutting Windows support, emagic would no longer be spending development cycles for these non-paying users. The piracy problem is hitting these smaller companies hard, and it shouldn't be overlooked here either. Apple has also gained a guaranteed testbed for their Core Audio technologies. So far, the major audio software manufacturers have been slow to adopt this technology, and Apple can push this technology through quicker now that they own one of the major players in the Mac audio production market. For this market, Core Audio is a real Windows/DirectX killer. The sooner they get it out, the quicker their market share will take off. As for the competition, Mark of the Unicorn (aka MOTU) has been Mac-only for quite a while, and until recently Digidesign, who owns the high end ($10k+) of the market with Pro Tools, were doing just fine as Mac-only. Steinberg has a majority of its users on Windows (I've heard it's 70/30), and Cakewalk are an all-Windows shop. Death of Logic Audio? In my opinion, far from it. Graham Hunter On the other hand? Subject: Bye bye Emagic Hi, I've been sequencing with Logic Audio Platinum since version 3,5 (now 5,1) and they have a really stable, compatible and full featured version for PC/Windows systems... a long trip since the begining that I have done with Emagic. End of trip. Bye bye Emagic, I'll try another sequencer. Thanks for the news Register, always on the edge. I was struck with the parallels to Quantum Computers dumping the Commodore 64 system "Q-Link" in favor of the larger number of PC users in its "America On-Line" system. There is still a good 8-bit following, but AOL has not died a tragic death that many X-users foretold (okay, maybe some of them wished ;-). There always has, and always will be a, "my architecture is better than yours" battle around, and this is one more example. I still use my C= 64 for sequencing, occasionally assisted by one of my Mac's, but I've been thinking that my new 1.3 Ghz / 128 Mb / Athalon could handle Windows and sequencing... I'll be looking for smoke. LeRoy Davis Development: Without two platforms to build for, development should move along quicker than today, along with the ability to trim down the staff and make the eMagic division leaner and more profitable. www.apple.com/switch: Count on Apple running rebates for PC users of Steinberg products, and simplifying eMagic's lineup - and making the highest end package (probably thousands right?) a shiny $999 ($299 promo for users of Cubase), and other promotions in the same vein. Apple retains their current eMagic users, while adding a nice chunk from the PC world. People get all bent out of shape when Apple does this sort of thing, but really, they are simply following the M$ trail of purchase and conquer. Expect Apple to continue swallowing up small and medium software companies, for at least the next two years, at a rapid pace. As Apple sells more and more highly profitable software, while giving it's software competition fits, it can also lower prices on it's boxes, offset by software profits. Dell, Gateway, and others, have no software to line their pockets with to combat this game. Schools: Package eMagic softare, for free, for the muic teachers to secure the HW sale. And Dell says? "Doah!" That is but one example. However, this is a way for Apple to really take it to small business. Look at this example: Small company of 150 employees - An Ad Agency. XServe: $3,999 (No licensing fees for 150 employees. Savings over Dell/M$ of approx. $30,000) Desktops: $200 more per box than Dell (150 boxes more x $200 = $30,000) Right there we are at a wash, but Dell had to sell at $200 less per computer with slim margins - while Apple makes fat margins and stays at the same overall price. FCP: $399 per license for 50 licenses = $19,950 AVID Xpress DV: $1,100 per license for 50 licenses = $55,000 Even if AVID wants to get aggressive, Apple can always just give FCP for free as a bundle... How does AVID do that? They can't. Shake: Mac only and only $999 x 5 users = $4,950 PC Shake equivalent like Lightwave = $1,595 per license x 5 users = $7,995 What I am obviously getting at is Apple will soon be putting together bundles that no other HW company can price compete with. Apple will eventually have a huge advantage. Regards, Mark Reschke ®
Andrew Orlowski, 03 Jul 2002