News Search News   September - October 2005 TELECOMS NEWS Vonage hit by VoIP patent lawsuit Sprint Nextel has stated that a subsidiary had filed a patent infringement lawsuit against Vonage Holdings and another internet-based calling service. Sprint Nextel, the third-largest US wireless company, claimed Vonage and Voiceglo Holdings, a unit of Theglobe.com, had infringed seven patents relating to voice over data packet technology developed by Sprint. The lawsuit, filed in a federal court in Kansas City, seeks injunctions against Vonage and Voiceglo as well as unspecified damages. BT's near break-up averted BT has dodged Ofcom's axe once again and given birth to a new network access unit, openreach. According to BT CEO Ben Verwaayen, the telco's restructuring won't necessarily mean price cuts; consumers won't see any changes except a new livery on the company's vans and ISPs will now be able to treat themselves to an online engineer booking system instead of calling up BT on the phone. Ofcom's decision looks likely to be replicated in other countries, turning this seemingly inconsequential event into something that may even have repercussions across the whole European Union BT to buy the rest of Infonet Germany BT has announced it has bought the remainder of Infonet Deutschland. It will purchase the 82 per cent it doesn't currently own from T-Systems, a subsidiary of Deutsche Telekom. BT didn't disclose the financial terms of the deal. Infonet Deutschland has 400 customers to whom it supplies services including web access and VPNs, and is valued at more than €19m. The management team at Infonet Deutschland will remain in place. The buy follows BT's £520m acquisition of Infonet earlier this year, as well as its earlier purchase of Radianz BT's video-over-broadband due next summer BT has revealed a few more details about its much-anticipated video-over-broadband service, which is due to launch within a year. Speaking at the Enhanced TV Show in London this month, Andrew Burke, chief executive of BT Entertainment, said BT planned to generate money from features such as personalised schedules and messaging services such as VoIP conferencing. Burke confirmed that BT was targeting late summer 2006 for the commercial launch of the service. BT slashes VoIP prices to keep customers BT has slashed its VoIP pricing to undercut number one Internet telephony provider Skype. The offer, which will only last until the end of this year, will see rates to a number of international destinations, including Australia and the US, cut to 0.5p per minute and fees for VoIP users making calls over a BT Openzone hotspot shelved. Gavin Patterson, MD of BT's Consumer division, said the price cuts come in an effort to stop Internet telephony providers tempting BT customers away with cheap calls. NTL grabs Telewest for $6bn NTL has agreed to acquire Telewest in a deal that values Telewest at $6bn, the two companies announced. Telewest shareholders will receive $16.25 (£9.22) in cash and 0.115 shares of NTL stock for every Telewest share they own, giving them around one-quarter of the newly enlarged NTL. The combined company will have a customer base of nearly five million customers, including 2.5 million broadband users. NTL and Telewest have predicted that the merger will allow them to save around £250m per year by 2008 and generate added value of £1.5bn, which could help the company to cut its prices. Is VoIP a security risk in your network? Companies are deploying VoIP services without fully considering the security implications, which is exactly what happened with early wireless network implementations, according to security experts. Voice over IP, where voice calls are broken up into packets and passed around a corporate network together with the organisation's data traffic, can provide enormous benefits for companies - such as cheaper international calls - but they also increase the risk of a security breach. London to get city-wide Ethernet LANs from BT BT will offer Ethernet networks that span London, in a new virtual private LAN service (VPLS) that forms a stepping stone to its much-heralded 21st Century Network (21CN). The Ethernet Virtual LAN (Evlan) service extends BT's existing LAN/SAN extension service, which uses fibre connections to make Ethernet links between places up to 25km apart and is currently being rolled out to all London schools in a government-backed project. The service can also be extended to greater speeds, as optical techniques can run multiple channels on the fibres used, through dense wavelength digital multplexing, which sends signals on different colours. MOBILE & WIRELESS NEWS Are you paying too much for mobile roaming? The EC has hit back at mobile operators charging rip-off rates for international roaming. The European Commission has created a website called 'Using my mobile abroad: am I paying too much?' which lets consumers compare sample roaming prices around the European Union. Information society and media commissioner Viviane Reding announced the move in July, in order to raise awareness of the high costs of roaming in Europe and encourage operators to drop their prices. The EC is also investigating mobile firms in Germany and the UK following claims that their roaming fees are too high. Reding said in a statement: "At a time when we have seen in Europe so much progress in other telecommunications services, the cost of using your mobile phone abroad is hard to believe." Two billionth mobile subscription reached The two billionth mobile connection is set to be made during September. According to Wireless Intelligence, a joint venture between analyst house Ovum and the GSM Association, the connection is expected to be made on 18 September. The figure marks a rise of nearly half a billion on last September, when 1.6 billion connections were made. Most of the new additions will come from developing markets such as China, India and Latin America. However, the two billionth connection doesn't necessarily mean two billion users, Wireless Intelligence has found. Now that mobile markets such as Sweden and the UK are reaching saturation point, it's common for many mobile users to have more than one phone subscription. The two billion figure also counts inactive pre-pay connections. Mobile industry will bet on 3.5G Mobile industry association the GSMA has confirmed today that HSDPA - a high speed broadband technology some call 3.5G - is the only upcoming access technology to get its official seal of approval. HSDPA (high speed downlink packet access) is already on the shopping list of several major operators around the world in the GSM camp, including Orange, T-Mobile and Vodafone, and has gained widespread acceptance with a thumbs-up from the GSMA, which represents 680 of the world's mobile operators. According to wireless analysts Visant Strategies, by 2010 1.3 billion mobile users will be using 3G, of which "hundreds of millions" will be using HSDPA. Mobile TV could hamstring 3G With O2's mobile TV trial launched a matter of days ago, analysts are predicting that such TV and video services could well cripple 3G networks as soon as 2007. According to a new report from research firm Analysys, the bandwidth necessary to support services such as streaming could fill up 3G networks within the next couple of years if just 40 per cent of mobile users take up mobile video or TV for just eight minutes per day. O2's i-mode to launch in October O2 has announced a 1 October launch date for its i-mode mobile data service. Originally developed by Japanese mobile giant NTT DoCoMo, i-mode has around 50 million users, mostly in the Asia-Pacific region. Now O2 is hoping to stir further interest in Europe by launching i-mode in three countries across the continent next month – Ireland, Germany and the UK. O2 has teamed up with around 100 partners to provide content for the launch of the mobile internet service including The Financial Times, online bank Egg, Streetmap and Viz, who will charge up to £3 a month for a subscription. T-Mobile to invest in US 3G Deutsche Telekom's mobile unit plans to invest in its US business and hopes to start third-generation services there in 2007, the unit's chief executive said. Analysts estimate Deutsche Telekom would have to invest up to $10bn to buy permits for 3G services in the US and build a network there for T-Mobile USA, the group's primary growth motor. This summer, fund managers told Reuters that Deutsche Telekom had been sounding out institutional investors as to whether they would prefer it sold the business rather than make such a large investment. Apple unleashes iPod Nano - and iTunes mobile Apple has unveiled a tiny new iPod that will replace the popular iPod Mini and a mobile phone capable of playing music downloaded from a computer running iTunes. The fully featured Nano, which is thinner than a pencil and roughly the size of a business card, uses flash memory rather than the small, spinning hard drives used in Minis. The Nano replaces the Mini line, which is located in the middle of Apple's line-up - in size and price - between the diminutive Shuffle and the capacious iPod. The Mini is Apple's best selling version of the iPod, and Steve Jobs predicted the Nano will be a worthy successor. It "will instantly become the highest volume and most popular version of the iPod", he said. $50bn by 2010 - no end in sight for SMS phenomenon SMS - text messaging over mobile phones - will grow in popularity so that the market is worth $50bn globally by 2010, according to new research. A report by Portio Research claims: "No other non-verbal form of communication in the world is used by so many individuals and is experiencing such a rapid expansion of its user base." The report forecasts rosy futures on the move for email, instant messaging (especially in the US), push-to-talk and even MMS, SMS' more feature-rich big brother, which should see similar revenues "by 2010 from considerably less traffic". The year 2010 will see some 2.38 trillion text messages sent, leading Portio to dub the medium "the cheapest, easiest form of peer-to-peer mobile communication ever known". COMPUTER & SERVICES NEWS Microsoft embraces PDF for Office 12 Microsoft has announced that Office 12 would support saving documents in PDF format. The company claimed to be receiving more than 120,000 requests per month for such a function, and said it would be available in all Office applications that generated documents, reports or diagrams. It will appear in the second public beta of the product, due in the first quarter of 2006. But Microsoft still has no plans to support OpenDocument, the Oasis standard file format for productivity applications, within Office 12. Strange said: "We're not hearing any interest from customers. Compared to PDF there isn't that sort of demand. If there was, I'd think we'd be interested in developing it." Ellison's ambitions for $30bn Oracle Oracle's chief executive has revealed his game plan to grow the software giant from a nearly $15bn company to a $30bn behemoth over the next few years - and to do so at a pace that maintains a 40 per cent operating margin. The PeopleSoft merger and Oracle's pending acquisition of Siebel Systems mark two recent mega-mergers that will help Oracle achieve the $30bn goal. And the PeopleSoft acquisition has already demonstrated Oracle can undertake large mergers without giving up its 40 per cent margins. Physicists put huge computing grid through its paces UK particle physicists have started the next phase of testing for the world's largest computing grid. The tests aim to improve the grid being built to process data from the Large Hadron Collider (LHC), currently being built at CERN in Geneva. The CCLRC Rutherford Appleton Laboratory in Oxfordshire has been exchanging data with CERN at rates of up to 650Mbps, and other UK sites at rates of up to 480Mbps - a thousand times faster than a standard home broadband connection. The service phase of the test began earlier this month and will take three months. During this period, particle physicists working on the experiment will test the grid by sending trial jobs, deploying new software and transferring data between sites. Supercomputers still too slow to forecast storm surges Meteorologists have excelled in forecasting the track of Hurricane Katrina and others but they still need technological advances in storm surge prediction, experts told a congressional committee. A panel of witnesses at the hearing said the supercomputers that meteorologists use to model storms have come a long way over the past few decades. A greater scattering of weather buoys, which transmit observations used in the modelling, has also helped to boost accuracy. But the computers remain too slow and don't always have a great enough density of data to make accurate predictions, according to Keith Blackwell, an associate professor of meteorology at the University of Alabama's Coastal Weather Centre. Intel predicts 'double-digit growth' again Strong demand for laptops could help Intel again see double-digit growth this year, the company said during its scheduled mid-quarter update. The chipmaking giant said it expects its revenue for July, August and September to be between $9.8bn and $10bn. The estimate narrows a revenue forecast Intel issued in July of $9.6bn to $10.2bn. Laptops have become a significant profit centre for Intel. In the first quarter of this year, laptop chips accounted for 30 per cent of Intel's output. That figure is expected to rise to about 33 per cent next year, Intel has said. Microsoft sets sights on medium-sized businesses Microsoft is targeting medium-sized organisations with a range of specially tailored business intelligence and CRM software it claims can boost their revenue and profits. There are around 1.4 million medium-sized businesses worldwide, according to figures from AMI Partners, and Microsoft chief executive Steve Ballmer said they have been neglected by IT companies. A key plank of this vision will be server software codenamed Centro, which will be based on the server release of Longhorn and the next version of Exchange. Given that the server version of Longhorn is not due until sometime in 2007, Centro could be two years away. INTERNET & MEDIA NEWS New Skype for Windows launched Skype has formally released the latest version of its voice over Internet Protocol service, which includes call forwarding and downloadable ringtones, pictures and sounds. Skype for Windows 1.4, first available in beta in August, lets callers forward incoming Skype calls to another Skype account for free. Users can also forward calls to up to three landline or mobile numbers for as little as 2 cents a minute, depending on the country, according to the company's chief marketing officer, Saul Klein. PayPal threatens banking business Banks and vendors should sell PayPal payments to retail customers, instead of trying to compete with the online company, an analyst has claimed. In a report entitled PayPal's New Micropayment Pricing Will Dominate Market, Gartner said the payment company will outstrip traditional payment methods and online transactions. Author of the report Avivah Litan, a research director at Gartner, writes that retailers should embrace PayPal services rather than use "outdated" payment methods. Universal broadband: BT targets trouble-spots BT will begin a series of trials later this year to attempt to push broadband coverage in the UK closer to 100 per cent. At present, around 0.2 per cent of people who are connected to an ADSL-enabled exchange can't actually get broadband. In some cases, this is because they live too far from the exchange for ADSL to work, or because their line quality is too poor. In other cases, it's because they are connected to their local exchange by legacy fibre-optic cables known as TPON (Telephony over Passive Optical Networks). TPON, unlike copper, can't carry an ADSL signal. BT's trials will not address another issue holding the UK back from universal broadband, the fact that some of the most remote local exchanges remain incompatible with ADSL; BT has said technologies such as wireless rather than ADSL could play a part here. Consumers spend £16bn online More than 22 million people spent a total of £16bn buying goods online last year, according to industry research. A study from the UK payments association, Apacs, found that 262 million transactions were made online last year, most of which were carried out with credit cards. Apacs said the rise in online retail is likely to continue over the next decade - by 2014 card payment volumes online could rise to 1.2 billion with total spending of around £60bn. Skype signs up with first 3G mobile partner Skype has announced it has signed a deal with its first mobile operator. The net telephony firm has agreed a partnership with the third largest German mobile operator, E-Plus, which will offer its customers free use of Skype's voice over IP (VoIP) service as part of its flat-rate data subscription package for 3G data card users. Under the terms of the deal, Skype will continue as E-Plus' exclusive VoIP supplier. Skype has already notched up 2.8 million users in Germany and will now gain access to a proportion of E-Plus' 9.8 million customers. The company is already working with mobile handset manufacturers, including Motorola, to develop Skype-enabled devices. Microsoft moves in on VoIP Microsoft is set to announce that it has purchased a small Internet calling start-up called Teleo, as part of a move to expand the capabilities of MSN Messenger. Microsoft has its eyes set on something more like net phone company Skype's service, however. A key part of Teleo's technology is focused on making calls from a computer to an ordinary telephone, a feature that company executives said would start finding its way into MSN Messenger before the end of 2005. The acquisition underlines the growing importance of voice services, increasingly indistinguishable from an ordinary telephone, to the instant-message platforms that have been one of the internet's most popular applications. BT Max: ADSL but three times faster for uploads? Following the failure of its SDSL services to appeal to UK businesses, BT is poised to put its faith in a new flavour of broadband. According to analysts at Ovum, BT will begin trialling a wholesale version of ADSL broadband known as DSL Max in September. DSL Max, known within BT as BT Max, offers the promise of faster upload speeds than standard ADSL, which could appeal to businesses who want to run bandwidth-hungry applications like VoIP and video streaming. Typically, broadband customers have been more concerned about the download speed of their broadband connection but upload rates could become more important as broadband take-up increases. OTHER TECHNOLOGY NEWS\ EU trying to regulate web "by the back door" Industry groups are complaining about what they claim is an attempt by the European Union to "regulate the Internet by the back door". The Broadband Stakeholder Group (BSG) and tech industry association Intellect are calling on the European Commission to drop its plans to publish a draft Audio Visual Content Directive (AVCD) by the end of the year. The current regulation framework - the TV Without Frontiers directive - was originally devised in 1989 by the EC to stop broadcasters from being hit by double regulation (in the country where the content is produced, and then again in the country where it is broadcast). European Institute of Technology on its way? The EC has launched a consultation into whether the continent needs its very own European Institute of Technology. According to the EC, research into technology is needed to help boost employment and the economy. However, Europe's tech community is failing to translate research successes into an advantage for the region's businesses. One proposed answer to the problem is the creation of a European Technology Institute (EIT), which could help to attract and retain the world's best tech brains, according to EC president Jose Manuel Barroso. One of the key objectives for the EIT could be to bring together European researchers and academics with the business community in order to commercialise the fruits of tech R&D, the EC said. China a "global ICT superpower" by 2010? China's success in the global info-communications and technology (ICT) sector will depend on the quality of government involvement in the economy, as well as the ability of local companies to innovate, according to Gartner. The ICT sector is divided into five broad sectors: hardware, software, services, telecommunications and semiconductors, the research firm stated in a media release. Though most countries strive to distinguish themselves in one or more of these sectors, "only the US has successfully developed in each of these five sectors", said Jamie Popkin, Gartner's group vice president and research fellow. March 2005 CeBIT 2005, 10 March to 16 March - Positive economic signals for the ICT sector - International appeal stronger than ever - More SMEs and retailers - result of targeted strategy - Substantial rise in percentage of trade visitors This year's CeBIT generated positive feeling of growth, and a distinctly optimistic mood within the industry. Exhibitors and organizers alike were very pleased with the outcome of CeBIT 2005, which registered more trade visitors, more decision-makers, higher visitor traffic at the stands, increased international participation and attendance, and more SMEs and retailers at the show. The rise in exhibitor numbers to 6,270 (compared with 6,109 last year) and projected industry growth of 4.3 percent worldwide are signs of an anticipated recovery in the global ICT market. Although there were more exhibitors, the number of visitors showed a further decline to about 480,000 visitors. TELECOM NEWS Mobile stunners top 10 stormed by Sprint and 3 Analysts have picked their top performers in the mobile space - and turned up some surprise winners across the world of wireless. While cutting edge 3G content and service providers get the nod in a report from research firm Analysys, the top spot goes to an old-school voice service. The top 10 were: 1. Bundled voice tariffs, Sprint PCS, USA 2. ThreePay prepaid tariffs, 3, UK 3. Mobile TV and video, 3, UK 4. SMS, O2, Ireland 5. FOMA 3G service bundle, NTT DoCoMo, Japan 6. Vodafone live! service bundle, Vodafone, Western Europe 7. TM3 integrated 2.5G/3G/PWLAN, T-Mobile, Germany 8. Ringtone downloads, Xing, Japan 9. Games downloads, IN-FUSIO, worldwide 10. Genion HomeZone tariff, O2, Germany VoIP to save fixed line telcos billions While VoIP is most often painted as a threat to mobile operators - snatching away vital voice revenues from mobile operators and fixed line firms alike - new research has found that VoIP might yet prove a help rather than a hindrance to the telcos. A report from research firm Analysys predicts that voice revenues will fall steadily - between six and 10 per cent per year - across the board as 3G operators try to lure customers with cheap and plentiful voice bundles. However, switching to VoIP could well help recoup some of the losses. BT keeps it Benelux for new control centre BT has opened a network control centre (NCC) in Amsterdam. It will monitor global data traffic at the services layer. It will complement a transport layer NCC opened two years ago in Diegem, in Belgium. Both sites will back up each other, with a third facility at a currently undisclosed location acting as a fallback for both. In a statement, BT Global Services said Amsterdam had been chosen because of its "central position, right education level and the multinational character of the city". MOBILE & WIRELESS NEWS Stelios launches no-frills mobile contender No-frills mobile operator easyMobile has officially launched in the UK. The venture is the latest addition to budget airline pioneer Stelios Haji-Iannou's empire and is concentrating on selling airtime and SMS without any bundling or handset subsidies. All voice minutes and texts will be sold at a single tariff - 15p per minute and 5p per text message - with no line rental charges. The operator will also be selling its services exclusively over the Internet and customer service will be minimal. Business people shun 3G as shipments boom Despite its rocky start, 3G could yet turn out to be both popular with consumers and telcos alike, with analysts predicting third generation technology will drive the handset market as shoppers scrabble to get the latest in cutting edge devices. Analyst house IDC predicts that the market for mobiles in Western Europe will grow at a rate of 12 per cent over 2005, with both 3G and smart phones slated to do particularly well in the coming months. 3 notches up three million users and more coverage Mobile operator 3 has seen its subscriber numbers jump almost tenfold in the last year but its average revenue per user (ARPU) has taken a tumble. The Hutchison Whampoa mobile firm announced its subscribers now number some three million - up from 361,000 back in March 2004. Its parent, which has operations in Italy, Austria, Australia and Scandinavia, saw around 1.7 million new subscribers added across its networks. Orange offers 'GPS-beating' location tracking Mobile operator Orange has unveiled a GSM-based tracking service, which it claims is cheaper and easier to use than GPS technology. Orange predicts that by next year more than 40,000 devices – such as train carriages, machinery and even vending machines - will be tracked using its Cell ID service. Do mobile operators covet broadband? Long have industry observers wondered whether 3G mobile could become your broadband connection at home. Now that the services are arriving, Anthony Plewes weighs their chances of success - and looks at mobile operators' motivations for moving in this direction. When UMTS started to attract serious attention at the end of the nineties, many 'expert' commentators seriously mooted the possibility of the 3G mobile technology's potential as broadband replacement. Fast forward to 2005, however, and it looks like the stuttering start to 3G mobile services put paid to any broadband ambitions. VoIP could be a threat to 3G voice Wireless voice over Internet Protocol (VoIP) networks could end up challenging 3G mobile operators' revenues from voice minutes, according to a new report. While not directly saying operators will be hit, the latest research from Analysys points out the threat of VoIP running over networks based on Wi-Fi, Bluetooth, WiMax and proprietary broadband wireless access technologies - all of which carry voice as another form of data packet. COMPUTERS AND SERVICES Dell and Sun alliance mooted A Wall Street analyst has suggested a partnership between Dell and Sun would help both companies with their server strategies. In a recent report, Sanford C. Bernstein analyst Toni Sacconaghi said that joining forces could help Dell reverse recent server market losses for machines running Linux and for higher-end models using x86 processors such as Intel's Xeon. And Sun could gain an ally selling its Solaris version of the Unix operating system and its x86 servers using AMD's Opteron processor. Intel to unveil latest Itanium processor Intel has shown a further glimpse into the future of its Itanium processor family, shining the spotlight on a new model code-named Poulson. Pat Gelsinger, Intel's former chief technology officer and now one of two chiefs of the company's Digital Enterprise Group, is expected to discuss Poulson briefly at Intel's Developer Forum in San Francisco, sources familiar with the situation said. Poulson is scheduled to succeed Tukwila, an Itanium processor due in 2007 that had previously been code-named Tanglewood. Intel declined to comment for this story. Outsourcing more expensive than in-house, says Gartner Outsourced customer service operations can cost almost a third more than those retained in-house, according to a new study by Gartner. The research found that outsourced operations are 30 per cent more expensive than the top quartile of in-house customer service operations. Gartner said firms often fail to take hidden costs such as in-house back-up support to the outsourced function into account. "The outsourced service is often more efficient but then outsourcers need to make a profit too." SunGard sold for $11.3bn A group of seven private equity investment firms have agreed to buy financial technology company SunGard Data Systems in a deal worth about $11.3bn, making it the biggest leveraged buyout in more than 15 years. The private equity group buying SunGard is led by Silver Lake Partners and includes Bain Capital, The Blackstone Group, Goldman Sachs Capital Partners, Kohlberg Kravis Roberts & Co, Providence Equity Partners and Texas Pacific Group. INTERNET & MEDIA World's top 10 intranets named A UK supplier of software to online bookies has been named alongside international giants such as Cisco and Procter & Gamble as operating one of the world's 10 best intranets. The list was put together by Nielsen Norman Group (NN/g), which is headed by web usability guru Jakob Nielsen. It found the winning companies saved between $200 and $1,000 annually per employee by improving their intranets, which are private, enterprise-wide networks typically of pages written using HTML code. BT trials 8Mbps broadband service BT is on track to start testing significantly faster broadband services next month, but only a small fraction of UK Internet users will be able to take part. BT Retail announced that it is engaging in the wholesale trials of 8Mbps ADSL services, but that these high speeds will only be made available to its own staff - cutting down the number available to actual consumers. DSL users crack 100 million barrier The number of DSL subscribers has climbed to 100 million worldwide, with some countries reporting growth of over 500 per cent in one year. Figures from analyst house Point Topic for the DSL Forum show the 100-million mark was broken for the first time last month, with countries new to the broadband technology showing biggest growth. The DSL Forum hopes to see 500 million subscribers to DSL by 2010. Banks must boost security to drive online banking Banks must compensate for their customers' lack of online security awareness if they want to attract more users for their Internet services. Two-fifths of the European Internet users who don't use online banking say they are holding back because they worry about security, according to a survey of nearly 23,000 Europeans by Forrester Research. OTHER TECHNOLOGY NEWS Brussels 'will kill off online BBC The BBC's online presence could be under threat from Brussels, as the EC's competition authorities look to scale back the Internet offerings of all Europe's public service broadcasters. The head of the European competition directorate, Nellie Kroes, is believed to be against the use of Europeans' TV licence fees to fund state broadcasters' online content, considering it as an illegal cross subsidy, according to unnamed sources. The report claims that the competition watchdog will bow to commercial interests and draft new policies which would see the BBC's ability to offer online services severely curtailed. Arise, Sir Bill Gates... Microsoft co-founder and chairman Bill Gates has been awarded an honorary knighthood by Britain's Queen Elizabeth II for his outstanding contribution to enterprise. Gates, the world's wealthiest man, received the award from the queen at Buckingham Palace. He has become a Knight Commander of the Most Excellent Order of the British Empire, an honour that dates back to 1917, though monarchs have been creating knights for hundreds of years. EU pushes for cross border procurement The European Commission has launched a new portal which it believes will herald the arrival of the next generation of e-government services as well as help businesses in their contact with the EC. The Your Europe Portal, which can be found here, has a section dedicated to e-services for businesses and is also charged with cutting through administrative red tape to help businesses from within the Union to win public sector contracts with foreign governments. August 2004 TELECOMS & NETWORK NEWS Watchdog to investigate 'cheaper' 118 calls The National Audit Office is to investigate Ofcom predecessor Oftel's introduction of directory enquiry competition to see if customers are getting a good deal. In the meantime, BT and The Number are engaging in a slanging match over which takes the majority of calls. The number of directory-enquiry queries has dropped by three million a week since Oftel scrapped BT's 192 service. This was supposed to improve service and cut costs to consumers by introducing competition. But with over 100 operators offering 118 services, the customers have wound up mostly just being confused. And many of them have just stopped using it, according to Ofcom figures released in June. Britons go gaga for broadband The popularity of broadband continues to grow in the UK, with the number of subscriptions nearly doubling over the past year. The number of permanent connections, always-on links provided by DSL or cable modems - reached 29.5 per cent of the total Internet connections in June 2004, compared to 27.8 per cent in May and 16.1 per cent a year ago, according to the Office for National Statistics, or ONS. This is no surprise, given the trend toward lower prices and wider availability of broadband. Dial-up, meanwhile, becomes ever less popular, with the number of connections falling 10.3 per cent since last year. There are now fewer dial-up subscriptions than when the ONS began to collect Internet data in January 2001. €250m deadline pushes Tiscali to sell up ISP Tiscali has decided to dramatically cut its overheads and sell up some of its overseas operations in order to meet its financial obligations. The company has €250m of bonds due for repayment by July and with its losses deepening, Tiscali has decided to sell off its operations in countries where they're underperforming, including Austria, the Czech Republic, Denmark and Spain. The ISP has already shed its arms in Norway, Sweden, Switzerland and South Africa - the latter having hit trouble over antitrust issues - and the sale of the ISP's assets in four more countries will leave it with a presence in its core markets of the Benelux countries, France, Germany, Italy and the UK, which make up the lion's share of its revenues. MOBILE & WIRELESS NEWS Motorola and DoCoMo announce 3G business phone tie-up Japanese telco giant DoCoMo and the world's number two handset maker Motorola have signed a deal to produce 3G handsets together. The handset, which will hit the market from spring next year an, will be compatible with GSM and GPRS and W-CDMA - pioneered in Japan by DoCoMo - networks. The agreement will also signal the development of the first FOMA (DoCoMo's 3G service) phone that can be used outside Japan. They stated the phone will have Bluetooth capability and will be able to be used with DoCoMo's and other companies' Wi-Fi hot spots. The handset will also be based on the Symbian operating system. iPass gets its Wi-Fi in the sky - thanks to Boeing deal Global Wi-Fi roaming supplier iPass is extending its range upward in a deal with Boeing Connexion, the in-flight wireless provider. The deal will give iPass' 528,000 customers broadband access on two Lufthansa trans-Atlantic routes. In addition, Boeing is currently fitting out planes for Scandinavian Airlines, Japan Airlines, ANA and a leasing company. Singapore Airlines, China Airlines and Korean Air have also announced their intentions to install Connexion on their long-haul flights. iPass aims to provide global connectivity for business travellers and gives access to over 11,000 hotspots around the world, including those in 121 airports. The vast majority of the company's customers come through corporate agreements. Stelios launches mobile company for UK's scrooges Stelios Haji-Ioannou - founder of easyGroup - has announced the launch of the company's own mobile virtual network operator (MVNO), easyMobile. It's a soft launch, however. Don't expect to be able to purchase an easyMobile just yet - or, in fact, at all. The easyMobile service won't sell or subsidise handsets. Punters can buy airtime and SIM cards but will have to supply their own handsets. There will be no high street shops either, just Internet purchases. Speaking at the launch, Stelios said that easyMobile was in talks with mobile operators to buy airtime but no network deal has yet been concluded. So is there anywhere Stelios won't be going? "You won't see easyFunerals… it's not price-elastic and it's not fun," he said. 3G users pass 100 million mark The CDMA Development Group (CDG) has trumpeted the number of end users with CDMA2000 handsets topping 100 million by the end of June - way ahead of 3G users within the rival GSM camp. Perry LaForge, CDG executive director, said that hitting the symbolic mark and then passing it - the latest stat is for 112 million users - is "a ringing endorsement of the ITU's 3G vision" and something to celebrate. However, the race to roll out 3G networks is not without controversy, not least over what constitutes 3G. While the GSM community's version of 3G, known as UMTS or by the standard W-CDMA, is rolling out steadily this year across dozens of markets, its user numbers are well below the 100 million mark. BT to launch first wireless broadband service Equipment vendor Alvarion has announced that Northern Ireland is to get BT's first public wireless broadband service later this year. BT has signed a £500,000 deal for Alvarion's 5.8GHz BreezeACCESS VL equipment, which will be used to provide broadband services to areas outside the reach of ADSL. With 99.6 per cent of the country to be reached by DSL, wireless is not currently feasible as a stand-alone product without partnership funding. However, it is part of our strategy for 100 per cent UK broadband coverage by the end of 2005. COMPUTER NEWS Arm pays $910m for US chip designer Arm is to pay $910m in cash and shares for Artisan, the US-based transistor-level designer for systems-on-a-chip. Arm chairman Sir Robin Saxby said: "This will be a combination of the two leading silicon IP (intellectual property), cash-generating and profitable companies." He added that the companies were complementary, with almost no overlap of customers or products. Artisan designs at the physical level and sells its designs to chip foundries. Arm designs chips and provides some of the software to go with them. Both companies emphasise the strength of their IP, with its royalties giving them both operating profit margins of over 20 per cent. In the 12 months to 30 June, Arm made $51.3m profit on $235m turnover. Apple's high-end bitten by chip shortage Apple may be facing greater difficulties than previously thought in sourcing chips to power its high-end personal computers. Financial firm Prudential Equity Group reported this week that the availability of G5 processors for Apple could be "worse than anticipated", according to a report on Forbes. These chips are supplied by IBM and used in the PowerMac G5. They will also power the forthcoming iMac G5. Apple had previously said that 1.8GHz and 2.0GHz G5 chips would be in short supply in July, due to manufacturing problems at IBM, but that availability would recover in August. The decline and fall of the Wintel empire Microsoft and Intel still have a lot going for them, but they're both facing three- and four-front wars. Michael Kanellos asks: Can they come out better than the Romans? Waking up rich and confused. That's how one analyst explained the recurring product delays at Microsoft, and the principle can describe similar problems at chip giant Intel. Instead of waking up sick and washed out, employees at these companies are seemingly dawdling a bit because of past successes and a hazy outlook. The creeping sense of privileged paralysis is one of the dominant themes of Edward Gibbon's The Decline and Fall of the Roman Empire, perhaps the ultimate book about big organisations gone bad. In over six volumes, Gibbon describes how the political and military leaders of Rome shifted from concentrating on governance to personal enrichment. Both companies are strong, but if you see Steve Ballmer feeding chickens, the end could be quick at hand. Security flaws will be patched, pledges Oracle Database software maker Oracle promised to quickly make patches available for the more than 30 flaws found by a British security researcher. While details of the flaws have not been made public, David Litchfield, managing director of security software firm Next-Generation Security Software, gave some general information about the issues at the Black Hat Security Briefings in Las Vegas last week. While information about the database flaws was to be released this month, the lack of patches convinced the security researcher to hold off. Litchfield first notified the software company of the problems - some of which he ranked as critical - in January. INTERNET & MEDIA NEWS Free music downloads - Stelios reveals all about his new service Stelios Haji-Ioannou, the entrepreneur behind the easyGroup companies, gave away details about his forthcoming easyMusic.com download service at the launch of his mobile venture this week. He revealed that the software for the service has already been commissioned and that the service is expected to launch in December. Unlike rivals such as iTunes and Microsoft's upcoming MSN offering, easyMusic.com will take a very loose stance on copyright issues. easyMusic will allow musicians to put their own music up for download via the site and for users to download and share it as they see fit, as long as they don't try and make money from it. Koreans join Web's '30-million club' The number of Koreans who use the Internet passed the 30 million-mark last month, representing 68.2 percent of the nation's 45 million people aged 6 or older. The Ministry of Information and Communication (MIC) said that the country had 30.67 million Net surfers at the end of June, up from 29.22 million six months ago. The data comes from a biannual survey of 17,347 residents from 7,030 households, conducted by the MIC and the National Internet Development Agency in June. Korea has become the fifth country in the world to join the 30-million club, following the United States, China, Japan and Germany. OTHER TECHNOLOGY NEWS India to get tough on foreign data security Indian IT body Nasscom (National Association of Software and Services Companies) has announced it is to examine its 860 member companies' security as businesses looking to outsource to the country express fears that data-protection practices aren't stringent enough in the country. India currently has no data-protection standard similar to those found in Europe, leading some - including a group of Labour MEPs and trade union Amicus - to demand that the EC stretch the data-protection law to UK data held overseas, raising concerns over how secure UK citizens' data is once it's transferred to the subcontinent. Consortium lands €50m European air safety deal Getronics and Siemens Business Services have joined forces to win a €50m, three-year deal to manage the desktops of pan-European air safety organisation Eurocontrol. The two will manage Eurocontrol's 1,430 desktops as well as networks and servers spread over three locations - two in Brussels and its experimental centre in Bretigny-sur-Orge in France. The contract allows for two one-year extensions. Nanotech funding reaches $8.6bn Corporations, governments, universities and others will spend an estimated $8.6bn on nanotechnology research and development in 2004, and a growing portion of the total comes from the private sector. Spending on nanotech research will more than double from the estimated $3bn level of 2003, according to an annual state of the industry report from Lux Research, a consulting firm that studies the industry. Currently, about 1,500 companies - 1,200 of them start-ups along with corporate stalwarts like GE and Intel -have announced R&D plans. July 2004 TELECOM NEWS Competitors urge Ofcom to clamp down on BT A group of UK telcos has demanded that Ofcom use its strategic review of telecoms to bring in new measures to prevent BT abusing its powerful position. The UK Competitive Telecommunications Association (UKCTA), which is made up of many of BT's rivals, claims the former incumbent is still in a position to block effective competition in the marketplace. In its submission to Ofcom's Strategic Review of Telecommunications, UKCTA urges the regulator to devise a regulatory system that would prevent BT from abusing its dominance of the broadband sector. DSL connections outstrip cable and others globally There are now over 110 million broadband connections globally and digital subscriber line (DSL) technology has come to account for almost two-thirds of them. In the UK, DSL - as opposed to competing technologies such as fibre, satellite and mostly cable - serves 60.2 per cent of broadband users, according to figures from industry analyst Point Topic. Of 69 countries that now have broadband, all but 11 are dominated by DSL. Regionally, all parts of the world are DSL-centric, apart from North America, where there are about 50 per cent more cable connections than DSL. Businesses warming up to VoIP After years of talk, voice over IP (VoIP) is fulfilling its promise and being used by businesses in significant numbers, according to industry experts. Predictions for the future are bullish. By 2008, the number of corporate telephone lines that use IP telephony will reach 44 per cent, according to analyst house the Radicati Group. And by the end of 2005, 45 per cent of European companies surveyed by IDC say they will have integrated voice and data traffic. WIRELESS AND MOBILE NEWS SMS price war could hit UK A war over the price of SMS text messages in the Netherlands could be replicated in the UK and even lead to a fiercer division between operators that choose to target businesses and those that focus on consumers. The Dutch mobile market is one of the most competitive in Europe, with 10 mobile virtual network operators - or MVNOs - as well as five facilities-based cellular providers and growth of 14 per cent in 2003, as measured by Opta, the country's regulator. However, consultancy Current Analysis reckons price cuts in recent months on SMS messages for pre-pay customers could spread to the more valuable post-paid sector - with serious consequences. Sun seal of approval sought by European operators Major European mobile operators Orange and T-Mobile Europe will soon require that downloadable games and other data sold to their subscribers meet quality standards set by Sun Microsystems and several major handset makers. Orange and T-Mobile Europe, which combined have 96 million subscribers, are the first carriers to commit to Sun's Java Verified program, which certifies software programs to ensure that they'll run on different companies' mobile phones. Sun believes that other carriers will be influenced into joining Java Verified as a result. China going for its own version of 3G in 2005 China is to launch its own 3G standard by June of next year before issuing licences to operators. The standard, TD-SCDMA, is also backed by Siemens, and handsets to be used on the Chinese networks will be dual mode and able to handle either the CDMA2000 or the W-CDMA standards. 3G network costs tumble The cost of building 3G network infrastructure is falling as the price of 3G processors fall, and operators revive their spending plans, according to a study published by IDC. IDC's Worldwide Base Station Semiconductor 2004-2008 Forecast and Analysis indicates that after a few years of sluggish activity, network operators have started investing in their infrastructures and are using standardised products to help reduce costs. The study estimates that spending on base station semiconductors alone will reach $1.9bn in 2004 and grow to $2.4bn within four years. UPS invests $200m in global wireless push Parcels giant UPS is making a $200m global investment in Bluetooth, Wi-Fi and cellular wireless technology - a move that should put an end to delays caused by snapped connector cables linking workers' equipment. In Europe, 73 parcel sorting centres and some 10,000 delivery drivers will by the end of 2005 use wireless devices. UPS, with annual revenues of around $33bn, reckons that should speed up package-tracking and enable customised services. COMPUTER NEWS Microsoft's play for SAP A can of worms has been opened. Late in the afternoon, GMT - crucially first thing in the working day in California - Microsoft and SAP disclosed that late last year they entered merger talks. Specifically, and according to an unusual statement from Microsoft, the US software giant "initiated preliminary discussions with SAP AG to explore the possibility of a potential merger between the two companies". Microsoft and SAP remain friends. The latter considers Microsoft a key web services partner and doesn't see much competition in its high-end space - at least not yet. One in three PCs being spied on Alarming research has revealed that one in every three computers is infected with Trojan horse programs or system monitor spyware. Internet access provider EarthLink and security software maker Webroot scanned nearly 421,000 computers for their April Spy Audit report. Trojan horses and system monitors accounted for 133,715 pieces of the spyware found on those computers - representing almost one in three machines. Apple supercomputer breaks the sound barrier A US Army contractor has purchased a $5.8m, 1,566-server supercomputer from Apple - a real-world cousin to an academic system that briefly appeared high on a list of the most powerful machines. In November, a machine called System X with 1,100 dual-processor Power Mac G5 workstations climbed to third place on the Top500 list of the most powerful supercomputers. Colsa has announced it is buying a larger system called MACH 5 to run Army simulations of the aerodynamics of flight much faster than the speed of sound. By comparison, the fastest system on a new version of the Top500 list, NEC's Earth Simulator, runs at a speed of 35.8 teraflops, and only one other system exceeded 15 teraflops. Microsoft takes on Linux in supercomputing Microsoft will sell a version of Windows for high-performance computing, a niche in which rival Linux is blossoming - with a first version planned for the second half of 2005. The Windows Server 2003 HPC Edition will include features for running windows on clusters of machines interconnected by a high-speed network to form a single computing resource, Microsoft said in a recent statement. Clusters are hitting their stride as a mainstream element in supercomputing, but they're not well adapted for some tasks, such as decryption. On the newest list of the top 500 supercomputers released this week, 291 were identified as clusters Market researcher IDC expects the high-performance computing market to expand from $6.1bn in 2004 to $7.6bn in 2008. PalmOne boasts soaring sales Narrowing losses for the year, handheld maker PalmOne reported rising revenue and a profitable quarter led by demand for its smart phones. The company recently announced sales for its fourth quarter, which ended 28 May, were $267.3m, compared with $217.1m in the same period a year ago. The company reported a profit of $13.3m, compared with a loss of $15m, or 51 cents per share, a year ago. Sun and Fujitsu merge Unix server lines Sun Microsystems and Fujitsu announced recently that they will merge their Sparc processor-based server lines by mid-2006.. The new products, under the code name Advanced Product Line (APL), will replace Sun's Sun Fire line and Fujitsu's Primepower products, the companies said. Sun and Fujitsu currently sell servers that use two different chip families, Sun's UltraSparc and Fujitsu's Sparc64. The chips can run the same software, including Sun's Solaris operating system, but require different hardware designs. INTERNET AND MEDIA T-Mobile turns handsets into mini digital music players With digital music fans spoilt for choice with a number of recent download service launches, T-Mobile is the latest to try its luck with online music. The operator has launched Ear Phones, a music download service for mobiles. Ear Phones lets users download and play tunes on their T-Mobile handsets, with three of the five majors – Sony, Warner and Universal – as well as various Indie labels signing on the dotted line as partners. T-Mobile is also launching five new handsets compatible with the new service, with seven more to join the stable before the end of the year. AOL buys advertising firm for $435m America Online has announced it will acquire interactive-marketing specialist Advertising.com for $435m. The Internet service provider said the all-cash deal will significantly boost its advertising network. The deal will increase AOL's web-ad-viewing audience to about 140 million Internet users, the company said. Advertising.com, which focuses largely on delivery of so-called behaviourally targeted advertising, will also expand AOL's array of technologies for creating and placing online commercials. Web services set for $11bn boost Web services will be the cash cow that vendors have been hoping for, with spending set to skyrocket over the next few years. According to analyst house IDC, software to support web services will attract $11bn of spending in 2008 – last year, it managed just $1.1bn. The increased outpouring of cash in the direction of web services will be driven by execs' desire to cut costs, the analysts' report - Worldwide Web Services Software Forecast 2004-2008 - says. OTHER TECHNOLOGY NEWS EU: Microsoft punishment on hold The European Commission has temporarily suspended an order requiring Microsoft to begin to offer a version of Windows without a media player this week. Microsoft said it been notified on Sunday of the Commission's decision, which effectively gives a Luxembourg court time to sort out the case without feeling pressure to reach an immediate decision. The announcement quickly followed Microsoft's request to Court of First Instance asking for an emergency stay of the media player requirement. A temporary suspension of the media player requirement while the case continues was expected either by the Commission or the court. Comdex 2004 shuts its doors Computer trade show Comdex, once the biggest event on the tech calendar, has been cancelled this year, a victim of the growing interest in shows emphasising consumer electronics and specialist IT gear. Eric Faurot, vice president of Comdex organiser MediaLive International said the company plans to give Comdex a breather after years of falling attendance, in the number of both attendees and vendors. The international versions of the show are expected to continue as planned. May - June 2004 TELECOM NEWS Energis reports 2004 profit Energis claims to have turned a corner, posting its first annual profit since the severe restructuring at the telco in 2002. For the 12 months to 31 March, it made a pre-exceptional item profit of £10m on revenues of £745m, down three per cent year-on-year compared to loss of £369m a year ago. Eamonn O'Hare, CFO at Energis said that the new, post-restructuring Energis had a very different strategy. It is concentrating on a smaller number of larger customers in the UK. Ofcom upstages BT's results announcement Only a day before BT announced its annual results, Ofcom revealed its shrinking revenues and also a contracting market share. The Fixed Telecoms Market Information Update reveals that BT has slipped under the 50 per cent mark for business calls revenue for the first time. It takes only 48.9 per cent of the cash spent on business calls. Its share of revenues from households has declined over two per cent to 69.4 per cent and mobiles are cutting the whole market in fixed-line telecoms, which dropped five per cent to £12bn in 2003. Frame Relay suffers as IP VPNs and more move on up Out go ATM, Frame Relay and leased lines. In come DSL, Ethernet and IP virtual private networks (VPNs). It may not be quite that simple but the world of data communications is in the midst of seeing some standards triumph at the expense of others, according to the latest research. Cambridge-based Analysys has identified virtual private network technology that makes use of Internet Protocol (IP VPNs) as a big winner this year, bringing in 40 per cent more revenue for providers than last year. At the top of the technologies labelled, as 'in decline' is Frame Relay, which will generate 26 per cent less revenue than in the earlier 12-month period. Clash over net phone legislation looms in US Regulators in large U.S. states are moving forward with net phoning rules, forcing an inevitable confrontation with federal regulators who believe the industry falls under their jurisdiction. By pushing ahead with regulation now, states are facing long battles in court with VoIP (Voice over Internet Protocol) service providers who believe that existing laws don't apply to them. Further battles are expected with the Federal Communications Commission, which could to leave states with very little, if any, regulatory power over IP-based phone calls. MOBILE NEWS Games and video the keys to European mobile Mobile data traffic in Europe will be driven by a cocktail of consumer services, rather than one killer application, according to a study released on Friday by market research company IDC. Among the perks that will fuel growth are games, ring tones and video and music download capabilities. These services will generate both traffic and cash for mobile service providers, IDC said, generating revenues as high as $8bn in Western Europe in 2008. BT and Vodafone collaboration BT has teamed up with Vodafone for business and consumer mobile services, replacing respectively mmO2 and T-Mobile. BT took the mobile virtual network operator (MVNO) route after exiting the business when mmO2 was spun off in 2001. BT said it hopes to generate £1bn in annual mobility and convergence revenues in five years' time based on the Vodafone partnership, despite take up of its BT Mobile service failing to live up to previous forecasts from the time of its launch. Siemens in billion dollar China boost Siemens, a top maker of mobile phones, plans to invest $1.2bn in China over the next few years as part of a plan to double revenue in that country. Part of the investment will go to a new headquarters in Beijing, while the remainder will mostly be used to expand Siemens' various business subsidiaries and to beef up its research and manufacturing facilities in the country, according to Siemens. According to Siemens CEO Heinrich von Pierer, the billion-dollar boost is designed to lift the company’s sales in China from $4.8bn last year to $9.6bn in the near future. Softbank scoops up Japan Telecom for $3bn Softbank has turned up the heat in Japan's cut-throat broadband market by paying a total of $3bn for Japan Telecom. The deal will bring in the former Vodafone subsidiary's 1.67 million internet subscribers and about 150,000 business users. When added to Softbank's 4 million-plus broadband subscribers under the Yahoo! BB brand, it will give the company a commanding lead in the Japanese battle for broadband market share. DoCoMo ditches 3 Japanese telecoms giant NTT DoCoMo has officially dropped its involvement with third-generation mobile operator 3. DoCoMo has announced that it will be selling its 20 per cent stake back to 3's parent company, Hutchison Whampoa. The reason for the split is thought to be 3 feet-dragging over the launch of DoCoMo's data services platform, i-mode, in the UK. A 3 spokesman said in March that the company was looking at all available options. Vodafone makes £12.6bn pre-tax profit Vodafone today reported Group pre-tax profits of £12.6bn, but with the wave of the accountants' wands this turned into a loss of £9bn. Despite taking these horrendous losses the company is to buy out its partners in Japan for £2.6bn, spend another £3bn buying back its own shares and boost the dividend by 20 per cent. It has already spent £1.1bn since last November in share buy-backs. The £9bn loss was achieved by taking a goodwill amortisation of £15.2bn. Games and video the keys to European mobile Mobile data traffic in Europe will be driven by a cocktail of consumer services, rather than one killer application, according to a study released on Friday by market research company IDC. Among the perks that will fuel growth are games, ring tones and video and music download capabilities. These services will generate both traffic and cash for mobile service providers, IDC said, generating revenues as high as $8bn in Western Europe in 2008. Operators will need to make available handsets capable of receiving streamed or downloaded video content. COMPUTER NEWS Gates builds massive new Indian Microsoft campus Microsoft is set to open a massive new research and development campus in India next year after buying a plot of land just outside of the high-tech city of Hyderabad. The company already has a presence in India for some software development but this new development will be Microsoft's first real campus in India. It will be housed on 42.25 acres of land in the Manikonda area, just a short drive away from Hyderabad's Hi-Tec City, which is home to many leading Indian and western IT companies. Other companies that are expanding their Indian outposts are 3Com, Qualcomm and SAP. Intel: 'Two cores are better than one' Intel has said it plans to move quickly to chips that contain two processors each - sometimes called dual-core processors - rolling them out for desktops, notebooks and servers at various times during 2005. Intel believes the dual-core approach will let it offer greater performance for desktops and notebooks while circumventing power-consumption problems. Dual-core chips offer more performance than single-cores by adding the ability to do multiple jobs simultaneously. A dual-core processor could, for example, render a video on one core while running a PC's operating system and other applications on its other core, said Intel President Paul Otellini. The change should give birth to new software by letting developers tap the additional computing power of an extra core in future applications, Otellini said. Server market goes mad for Linux The server market is growing in the US - but not for everyone. IBM and Dell each saw server revenue grow by more than 20 per cent in the first quarter compared with the same period a year ago, according to researcher Gartner. The "other" category, made up of second-tier manufacturers, also did well, experiencing year-over-year revenue growth of 25.3 per cent for the overall market and 71.9 per cent for the Linux market - faster than the market as a whole. In most categories, the "other" group generally saw faster growth than nearly all the brand-name manufacturers. 100 million PCs to get the boot in 2004 Nearly 100 million PCs are likely to be replaced this year, with 120 million being swapped out in 2005, according to data from research firm Gartner released. The volume of replacements in the next two years will surpass the number of units replaced in the run-up to Y2K in 1998 and 1999, Gartner said. In 2004, replacement units will drive global shipments to 186.4 million, an increase of 13.6 per cent over 2003. In a forecast, Gartner said consumer sales would be driven by upgrades to new desktops in GM 'crash hot' on IBM supercomputer General Motors has purchased an IBM supercomputer capable of performing nine trillion calculations per second to speed up crash and safety simulations, a significant shot in the arm for Big Blue's supercomputer effort. The system, a cluster of Unix servers connected with a high-speed network, will use more than 2,000 processors. About half are in a collection of 145 p655 servers being installed now that use IBM's Power4 processor, and the remainder are Power5 processors in servers scheduled to arrive by the end of the year. fully operational. The GM supercomputer will be used to improve automotive safety research by simulating crashes with mathematical models rather than performing real-world crash tests. INTERNET AND MEDIA Porn spam is dead The amount of spam featuring pornography has fallen dramatically as spammers turn to more profitable products to flog and email less likely to meet with resistance from filters. According to statistics from mail-filtering company Clearswift, the percentage of all spam flogging porn has dropped to just five - financial spam picked up the slack with a 27 per cent rise since June 2003. The other hot property in spammers' must-sell list is dodgy digital TV decoders, which supposedly give users the chance to get a look at channels they're normally barred from and are, obviously, illegal. Google's top search spot under threat? When it comes to search engines, people overwhelmingly prefer Google, but increasing competition from a number of rivals could eventually threaten the company's top spot, a new study claims. The survey by market research firm Vividence found Google's results vary little from those found on other search sites. In addition, despite the search king's continued success in attracting customers, its users are less likely to click on advertisements listed on its site. Google declined to comment on the study due to the quiet period the company has entered as part of its pending initial public stock offering. Oxfam hopes to make big noise in download market With the long-awaited launch of Napster in the UK not even a week old and iTunes' promised European arrival getting closer, it seems everyone wants a slice of the music downloads market these days. The latest entrant into the pay-per-song fray, however, is raising a few eyebrows. Charity Oxfam has announced the launch of its own song-shop offering, bignoisemusic.com,. Like other download sites, users will be able to stream or download a track. Prices for downloads start at 75p. The site will offer music fans 300,000 tracks from 12,000 artists. OTHER TECHNOLOGY NEWS Ofcom is Europe's best regulator The UK has Europe's best telecoms regulator, closely trailed by Denmark and Ireland, with Germany and Belgium coming in far down the field. That is according to a study released by trade body ECTA (European Competitive Telecommunications Association). The study also shows that there is a direct correlation between effective regulation and the level of investment in telecoms. Countries such as the UK, which have effective regulation and a low level of state ownership, get the most investment per capita. Germany, which lacks transparency and has a slow legal system, has the least investment. Sasser costs at $500m and rising The cost of the Sasser virus to business worldwide is thought to be as much as $500m - and that's before the latest version of the worm (Sasser.f) has really got going, according to consulting firm Computer Economics. Security experts at McAfee, said that the Sasser worm is just the latest in a string of viruses with multiple variants. For the first time, the letters of the alphabet have been exhausted and variants are being labelled Bagle.ab and so on. Clark estimates that the bill for the MyDoom virus will have hit $4bn by the end of the year. April 2004 TELECOM NEWS Ofcom steps in and BT slashes migration charges Ofcom has stated that it had a mind to cut BT's migration charges and, almost simultaneously, BT announced that it was slashing them as of May Day. The new charge for switching from IPStream to DataStream is to be £11, instead of £50 or the special offer price of £25. BT asked the regulator for permission to bring in the new prices on 1 May instead of waiting for the 28-day statutory notice period. This coincidence can be seen as a victory for Thus and Tiscali, which had made the original complaints about the high cost of moving customers from BT's IPStream to DataStream. The Broadband Industry Group also stepped forward to crow a little. Wanadoo ready to push VoIP and battle BT Parent company France Telecom is burying the hippy-flavoured ISP and rebranding it under the Wanadoo label, all with a heavy broadband bias The company is so keen to carve out a niche in the flourishing broadband sector that it's prepared to take a loss to do it. Eric Abensur, UK CEO of Wanadoo, said that a new broadband product, a 512Kbps for £17.99 offering, to be launched in conjunction with the new branding, will actually cost them money. The loss leader is just a part of the new Wanadoo strategy, with the company determined to haul the UK into the broadband fast lane, keep pace with the other European countries in which it does business and become "a challenger to BT on broadband". Telewest gives customers 50 per cent faster broadband for nothing The war for domestic broadband has opened up a new front. While other operators have recently been falling over themselves to shave a few more pounds off the monthly fee for ADSL, Telewest has announced that it's decided Britain has a need for speed. Telewest's broadband arm has revealed that it's boosting the speed of its connections but won't be charging its users any more for the privilege. Speeds will be increased by about 50 per cent, the provider has said. New customers will be able to get their hands on the higher-speed services at the end of May and those already using the service will be upgraded on a "region by region" basis during the same time period. Most of Telewest's Blueyonder broadband products will increase its speed, with the exception of the 'entry-level' 256Kb product. Its 512Kb offering will rise to 750Kb, the 1Mb will go up to 1.5Mb and its 2Mb connection will jump to 3Mb, making it the first residential service to break the 3Mb barrier. MCI re-emerges from bankruptcy to shake world telecoms? MCI has emerged from bankruptcy having shed an unsightly $36bn worth of debt and its top management but hung on to around $6bn in cash, 20 million customers and a global net that handles 35 per cent of the Internet. While CEO Michael Capellas, parachuted in from HP in 2002, paid tribute to the 50,000 remaining staff and his loyal customers, observers warned of price wars and consolidation in a world telecoms industry suffering from chronic overcapacity. MCI's debt is only about $6bn, while their competitors, racked up tens of billions of debt in mergers and licence fees. Their interest payments will be much less than others, for a start. They may say that they won't engage in price-cutting but customers who have stayed loyal during the difficulties will expect a reward in lower prices. NTL to axe 1,500 staff Cable company NTL is to axe 1,500 call centre jobs, in a twist that is likely to anger those who already struggle to get through to an operator on the beleaguered firm's helpline. The lay-offs are as a result of the closure of 10 out of 13 call centres across the UK, in locations such as Belfast, Brighton, Cambridge, Glasgow and Winnersh. According to reports, NTL hopes the high natural turnover of call-centre staff will bring about natural attrition during the next 18 months but the likelihood of an entire call centre's staff deciding it's time to move on is slight and some redundancies will be necessary. Level 3 says time is right for residential VoIP Level 3, the US-based wholesaler of telecom services, has announced the next phase of its voice strategy. Following on from the launch of its VoIP products for businesses and call centre operators in the US last year, Level 3 is to unveil two new residential VoIP services at the 2004 VON Conference & Expo, held in Santa Clara, California (28 March to 1 April). Initially targeted at the US market, Level 3 intends to roll out residential VoIP services to Europe in the second half of this year on a ‘country-by-country’ basis, which countries those will be has yet to be disclosed. MOBILE NEWS Chinese CDMA phone to be based on Microsoft OS Microsoft has won an important place for its Windows Mobile operating system inside CDMA handsets to be rolled out by a subsidiary of China Unicom. China Unicom NewSpace, part of the country's second-largest operator, after GSM-based China Mobile, will launch the CU928 multimedia phone on its U-Web CDMA 1x-based service. The device is a mix of a PDA and cellular handset, using dual chips and the Pocket PC Phone edition of the OS. An Intel PAX265 400MHz processor looks after the PDA part while a Qualcomm MM5500 takes care of the communications. Meanwhile competitors are targeting both China and the CDMA platform, which isn't currently found in Western Europe. Nokia fading because of poor line-up Handset giant Nokia has issued a warning about second quarter revenues amid fears its handset portfolio is being left standing by tough competition from more innovative rivals. The once dominant Finnish company said second-quarter earnings per share (EPS) would be between 13 and 15 Euro cents, well below the underlying figure of 19 Euro cents from a year ago and missing all expectations in a Reuters poll that called for 18 Euro cents. The outlook seems to confirm analysts' fears that Nokia, which makes more than one in three handsets sold globally, could lose more market share to rivals such as US giant Motorola and South Korea's Samsung, which earlier on Friday posted record earnings. Multiplying mobile The mobile industry seems embarrassed over the continuing success of SMS when it wanted users to adopt much more sophisticated technologies The Norwegians send a lot more SMS than other countries (even neighbouring Scandinavian ones), but no one knows why. Popular telecom belief has it that SMS may have even contributed to a change of government in the Philippines, where fishermen routinely text each other to track prices for the day’s catch and so optimise their income. In Scotland, tracking Prince William in his university town has become a major application for SMS within the local student community. We see emerging examples of spam, and even ‘blue jacking’ with short range connections providing the opportunity for anonymous, familiar messaging. Young people in Germany have developed highly elaborate social rituals around texting. COMPUTING AND SERVICES NEWS Grid computing: Its $12bn time is coming, say analysts Like RFID before it, grid computing has been accused of been all hype and no substance. Not so, say the analysts - the grid market is about to explode into billions of dollars. Analyst house IDC is predicting in its latest report, Role of Grid Computing in the Coming Innovation Wave, that grid computing will be worth $12bn by 2007. According to IDC, it's all a question of maturity. When grid finally gets its act together in terms of software and standards, and spreads beyond niche high performance computing applications, the technology should make it onto CIOs' must-have list for their data centres. Dell ups enterprise credibility with SAP deal Dell has beefed up its enterprise credentials in a new deal with SAP that will see the German enterprise software company work towards optimising its software for industry standards-based hardware from Dell. Dell chairman and CEO Michael Dell said: "Technology spending is increasing. Companies are more confident within their business and remembering what spending is all about." He said spending is moving "towards growth… more than just a focus on costs". Half of SAP installations are in transition to standards-based platforms and that represents a huge opportunity for Dell. However, SAP CEO Henning Kagermann said that the new partnership, while an endorsement of Dell and its model, does not mean the end of SAP rollouts on equipment from the likes of Sun and IBM. Microsoft beats the Street - but can't escape legal bills Microsoft has reported fiscal third quarter revenue above expectations but saw its earnings dented by the costs of a fine by the European Union and its settlement with Sun Microsystems. The software maker said it earned $1.32bn, or 12 cents per share, on revenue of $9.18bn, for the three months ended 31 March. That compares with earnings of $2.14bn, or 20 cents per share, on revenue of $7.84bn in the same quarter a year earlier. The results included stock-based compensation expenses that amounted to 5 cents per share and legal charges equalling 17 cents per share. Excluding those items, Microsoft would have had earnings of 34 cents per share, ahead of the 29 cent First Call estimate and the company's own predictions. ARM moves up and heads for 1.1 billion shipments this year Chip-designer ARM is motoring back to its glory days with growing revenues and projections of 1.1 billion shipments for the year. The company, which designs chips for 80 per cent of the world's mobiles, has signed 14 licence agreements in its last quarter, five of them with new customers (or partners, as ARM prefers to call them). In sterling, ARM's first quarter revenues showed a slight gain on the last quarter of last year, from £34m to £35m. But in dollar terms, the company saw a 12 per cent jump in royalties and a 14 per cent rise in licence fees to a total of $48.7m. A company statement claimed that the fall in the value of the dollar effectively clipped £2.1m from the figures for the quarter. IBM Linux roll-out going slowly Big Blue is migrating over to Linux internally but it's taking its time, according to an IBM executive speaking at the Linux User and Developer show in London. IBM isn't rushing its entire staff onto open source software but is embracing Linux in places where it provides genuine business benefits, the company said this week. At the start of this year, an internal IBM memo showing that senior IBM staff were seriously evaluating the adoption of Linux on its internal desktops by the end of 2005 was leaked. IBM then insisted that its actual plans were not so bold, and according to Chana this position hasn't changed. Linux not the cheaper option, claims report Migrating to open-source software may cost some companies more than simply upgrading their Unix or Windows systems, according to a study research company The Yankee Group released Monday. Based on a survey of 1,000 information technology administrators and corporate executives at companies around the globe, Yankee's report concluded that the technical merits promised by Linux and applications built to run on the operating system have yet to overcome financial concerns related to adopting the software. At companies with 5,000 or fewer users, Linux can save more money than other systems, including Unix and Microsoft's Windows software, said the Boston-based company. Intel lays its cash on the digital home Intel named the first four beneficiaries of its $200m Intel Digital Home Fund at the Intel Developer forum in Barcelona this month. The chipmaker never reveals the size of its investments but a spokesman helpfully said that its typical investments were for sums between $1m-$10m. Three of the investees have different bits of the ultra-wideband (UWB) market that will allow people to move digital content, such as music, hi-definition video and so on - from one room to another or just outside the door. The fourth is Trymedia Systems, which makes security software to protect video games from piracy. The company also operates a website that game-makers can use to seal their products. The company is based in California but has its research engineering team in Spain. INTERNET AND MEDIA iTunes loses 95 million songs Apple said this month that about 5 million free songs have been given away through a Pepsi promotion, far fewer than the 100 million tracks that could have been redeemed. An Apple representative said the music giveaway was probably the biggest ever of its kind but admitted that the company gave away fewer songs than it had intended. The 5 million free tracks Pepsi gave away were included as part of Apple's statement earlier Wednesday that it has sold 70 million songs in the first year of its music service. Apple said last fall that it hoped to distribute 100 million tracks in its first year, but when that figure was calculated, it was expected that more winning bottle caps would be redeemed. Overall, Apple CEO Steve Jobs said that he was pleased with the rate at which Apple's music store is growing. Google files for £2.7bn IPO Internet search leader Google filed to go public this month, seeking to raise $2.7bn in an unusual auction-style offering that will give the founders rare control over the company. The registration filing with the US Securities and Exchange Commission offers an estimate of what the company believes it may be able to raise with its initial public offering but it does not disclose the number of shares that will be offered nor the range in price for those shares. As a result, the potential market value of the company will not be available until the company files an amendment to its IPO that lists those figures. Napster trailing $17bn legal bill Napster has been reborn as a legal online music service, but the ghost of its former renegade song-swap self is trailing about $17bn of legal baggage. Music labels and publishers will face off against Bertelsmann AG in federal court in San Francisco on 27 April over claims the German media company's 2000 investment in Napster kept the file-swapping service operating eight months longer than it would have done otherwise. The lawsuits claim the extra lease on life promoted widescale piracy and cost the music industry $17bn in lost sales. Google slammed for anti-Semitic search Search site Google has been drawn into a controversy during the week of Passover over a search listing that directs viewers to an anti-Semitic site when they enter the keyword "Jew." The dispute began several weeks ago when Steven Weinstock, a New York real estate investor and former yeshiva student, did a Google search on "Jew." The first site returned was Jew Watch, a site filled with short articles focusing on alleged Jewish conspiracies and other anti-Semitic topics, with headings such as "Jewish Controlled Press" and "Jewish Mind Control Mechanisms." The administrator of Jew Watch did not respond to an email message requesting comment. Google spokesman David Krane said the company's search results are determined by a complex set of algorithms that measure factors such as how many sites link to a given page. The company can't and won't change the ranking for Jew Watch, regardless of how many signatures the petition attracts. OTHER TECHNOLOGY NEWS CeBIT 2004 - A Personal View Our reporter spent three days at CeBIT 2004, starting on the middle Sunday of the show. The first impression was very positive, namely the relatively large number of visitors in comparison to the previous year. However, the positive impression was marred somewhat by the fact that at least 50% of the visitors appeared to be private rather than business people. The upside of course was that excellent business discussions took place with the professional visitors.This was confirmed in subsequent discussions with exhibitors. The press area and press activity during the second half of the exhibition was relatively quiet. Most of the significant press conferences were held in the first part of the CeBIT week. Press material was available in abundance, as usual, so that there was no risk of missing out on information. The busiest halls were those which hosted the mobile providers (most notably E-Plus, O2, and Vodafone) and their telephone suppliers (Nokia, Ericsson, Siemens etc.), Deutsche Telekom (the busiest stand of them all), Internet associated companies (ISPs, and consumer-strong software companies. The traditionally busy IT hardware and professional software halls were less well visited and the likes of HP, Dell, Lanier and Canon were not present with their own stands. Although UMTS was a heavily advertised topic, providers still exhibited primarily the technology (with greatly improved cameras and displays), even in light of imminent introduction of UMTS services. Services presented revolved around video and music applications. EC launches €12m Euro-ID research project The EC and Switzerland are to spend €12m to test technologies and attitudes for a community-wide architecture for identity verification as part of an e-government initiative. BT, Siemens and Visa will be leading a group of 23 organisations called Guide (Government User Identity for Europe) that will be examining the technology and the social and political barriers to a system. The first phase of the exercise will consist of a roadshow held at ministerial level in all 25 Member States and a series of trials. After an 18-month initial phase in which Guide will be looking at the range of existing technology and other nascent technologies, the consortium will carrying out a further 18-month validation programme. VoIP could shatter US telecoms VoIP will grow so fast that it will disrupt the US telecoms system and cause a fragmentation of supply and services according to a US analyst's report. The report by research firm Analysys stated that: "The rapid growth of Voice over IP (VoIP) service in the USA represents a turning point in the development of the US telecoms market." The research company predicts that, by 2008, VoIP will be used by 17 per cent of broadband households in the US (11.7 million) and 23 per cent, or 800,000, of the broadband enabled small businesses. Big businesses will be pushing even harder with a 50 per cent compound growth rate to hit 18 million VoIP enabled lines. This will all generate about $5.7bn in revenue, which sounds like a lot but doesn't stand up to the total US telecoms revenue of $224bn a year. AOL Time Warner faces charge of 'cooking the books' The US Securities and Exchange Commission is preparing to formally accuse Time Warner of improperly booking more than $400m in advertising revenue, according to reports. The case alleges that Time Warner and its AOL unit misled investors about the financial health of AOL by pumping up ad revenue in numerous deals, and by inflating AOL subscriber numbers, The Washington Post reported on Tuesday. Citing federal sources, the newspaper said the improperly booked revenue related mainly to an ad deal with German media company Bertelsmann, following Time Warner's 2001 merger with AOL. The SEC is also reportedly considering seeking financial sanctions against Time Warner for not co-operating sufficiently with the investigation. Microsoft pays $440m in latest settlement Microsoft has ended another long-standing legal dispute and h announced a $440m settlement and licensing deal with InterTrust Technologies, which markets digital rights management tools. The settlement marks the end of the nearly 3-year-old patent infringement suit. InterTrust's suit contended that virtually all of Microsoft's products - from the company's flagship Windows operating system to its multimedia software - trespassed on InterTrust's content protection holdings. The deal opens the door for Microsoft to expand the array of antipiracy tools it provides with its digital media software, including Windows Media Player. Nigerian '419' scammer sent to prison A Nigerian conman who tricked people into handing over money and personal data in expectation of receiving a huge windfall has been sentenced to 20 months in prison by a Welsh court. Peter Okoeguale, 33, who was arrested in Wales while is the process of committing one such '419' scam, also faces deportation from the UK at the end of his sentence. When arrested, Okoeguale was found in possession of headed notepapers and forged documents, all created for the purposes of duping gullible victims and making them believe he was a in charge of a large fortune which needed to be laundered through a Western bank account. Police investigating the case have tracked down 11 victims of Okoeguale. One individual in Scotland lost £20,000 to the scam, according to police. BBN’s Grand re-entrance Do the @ sign, the Internet, the first router and e-mail all sound familiar? While such things are now commonplace, each had their genesis in a rather nimble company from Cambridge, Mass., called BBN. Many thought that BBN was no more; it had been swept up as part of Bell Atlantic’s acquisition of GTE. But the reports of its demise were premature. Tad Elmer, a veteran BBN employee, will now take on the role of president and CEO of BBN. "One of the things that’s surprised me is that there was a perception in some places that we had gone away. We have been here all this time, but were not growing 100 percent a year and not losing millions of dollars," said Elmer. "We just toiled away and did our thing. Our customers in the R&D space certainly know who we are, but in terms of the general public’s perception, we have been very quiet, so now we have a chance to blow our horn just a little bit." March 2004 TELECOM NEWS Bulldog takes a bite out of SDSL market Bulldog Communications, one of the few companies offering wholesale broadband services in competition with BT, announced on Tuesday that it is expanding its symmetrical DSL (SDSL) range. Around 350,000 businesses at selected sites across Britain can choose a range of high-speed services from Bulldog. These include an alternative to traditional leased lines, which Bulldog calls the 'IP leased line' service. This gives the user a dedicated four megabits per second (Mbps) connection with a guaranteed 99.9 per cent uptime. Bulldog says it will respond to any fault on the line within four business hours. Prices start at £162.50 per month on top of a £1,595 connection fee, which compares favourably with the cost of a leased line. Broadband Britain: It's war A group of telecoms operators claim that Britain's broadband market is being "stifled" because of BT's dominant position. The Broadband Industry Group (BIG) urged the government to do more to encourage competition in the sector, in a statement published on Friday. BIG says that the broadband market in the UK remains stifled by a lack of competition at the wholesale level where BT retains a monopolistic 99 per cent share in DSL, the leading technology, BIG is made up of Brightview, Cable & Wireless, Centrica, Energis, Freeserve and Tiscali. Unless a genuinely competitive market is created, alternative broadband providers, consumers, businesses and the UK economy as a whole will miss out on the benefits of broadband. Telewest announces budget 256Kbps 'broadband' Telewest Broadband will in the spring launch a 256Kbps always-on home Internet package, as a cheaper option to its 512Kbps, 1Mbps and 2Mbps services. It will cost £17.99 per month and is almost certainly in reaction to Tiscali's popular £15.99 per month 150Kbps offering, although that divides up a wholesale ADSL product rather than use cable. Despite the likelihood there will be a market for an always-on, cheaper alternative to current services from ISPs that use copper lines and cable companies, it is questionable how many end users will agree with Telewest that the offering is indeed broadband. Broadband prices take a new tumble The broadband price war that saw BT drive monthly access costs to under £20 has seen fees take a further tumble to £17.99. Freedom2Surf announced the cut on Friday, touting the new offerings as broadband "a complete package" for dial-up prices - but like rivals' plans, there's a catch: users will have to have a limit on their traffic. The two new packages, Connect and FamilyConnect have a cap of 1GB and 2GB per month respectively. Both come with 20 email addresses and 50MB of web space. The issue of a data limit has raised questions about exactly how users will know when they've reached their maximum downloads but Freedom2Surf's subscribers will be able to check out how much they've used via a special area on the company's website. Telecoms to save €12bn by offshore outsourcing While the financial, tech and customer service firms have been quick to turn to offshore outsourcing in recent months, the telecoms sector may soon be catching up. A report released by Deloitte's technology, media and telecoms arm suggests that the telcos may be hot on the heels of other industries turning to offshoring to cut costs and boost revenues. Figures from the consulting firm predict that by 2008, five per cent or 275,000 telecoms jobs – notably IT, call centres, accounting and application development – will be offshored to locations including India, Estonia and Argentina. BT cuts residential voice calls BT has announced price cuts, which it says will make bills easy to compare and mean savings as compared to rival services. The telco is getting rid of its standard rate for residential customers and lowering prices on its three BT Together plans. The UK Public Accounts Committee has criticised BT and former regulator Oftel for confusing consumers. However, with an early bird conference call this morning BT is clearly fighting back, in particular against cable companies that have long claimed to offer better value voice calls. Customers moving from the scrapped standard rate will go to BT Together Option 1 where they will pay 3p per minute in the daytime and 5.5p for up to an hour long call in the evenings and at weekends. Full details are available from the BT.com website. Consumers suffering from fixed-line 'monopoly' A report from the Public Accounts Committee published today has slammed BT and former regulator Oftel, saying the 'quasi-monopoly' of the telco is bad news for the fixed-line market, and especially for consumers. Despite Oftel's attempts to open up the fixed-line domain, BT still has 75 per cent of the market. The PAC thinks that more consumers should be switching to other suppliers to save themselves money and it's down to the telecoms watchdog Ofcom to tell them how. BT rolls out cash-dispensing phone boxes The public phone box, which has been demoted in status in recent years by the ubiquity of mobile phones, has received a fresh lease of life through a joint venture between BT and Travelex. The companies are currently trialling the next-generation phone kiosks, which double as ATM cash points. If successful, they will roll out a further 300 later this year. The Travelex-branded trial kiosks are already in place in Portsmouth, Southend and Sutton in Surrey. This is just the latest attempt by BT to reverse the downward trend in its payphone business. Are the days numbered for the traditional landline? Italian ISP Tiscali has sounded a warning to incumbent landline providers as it begins to roll out voice over Internet protocol services to residential customers across Europe. The ISP is taking aim at traditional landline revenues with the much cheaper option of VoIP, which it is to offer as a value-added service to its existing DSL customers in association with convergence specialist Netcentrex. It's a trend that already has major telcos worried - last week a BT representative confirmed that the company is working on VoIP in order to soften the blow to its landline revenues from competing VoIP providers. The representative told silicon.com that even established telcos "can't fight the tide forever" - an admission that the cheaper VoIP is set to become standard. MOBILE NEWS mmO2 plans a boom year BT mobile offshoot mmO2 predicts that it will show its heels to UK rivals and grow revenues in the UK by 15 per cent this year despite intense competition. Part of the boost will be from its rollout of O2 Airwave, the new emergency services' combined radio, mobile phone and data network. Green MEPs early this week called for a ban on the erection of Tetra masts, the foundation of the new network, for health reasons. Airwave has issued a statement to the effect that there was no evidence that Tetra was harmful to human health; that it was already in use in the UK; and that some 350 networks exist in 55 countries around the world. Hutchison sell-off to feed 3 cash burn Hutchison is bundling its non-3G interests for an IPO to raise cash for its loss-making 3 business unit. The conglomerate's fixed and mobile interests in Hong Kong and its share of ventures in India, Macau, Israel, Thailand, Sri Lanka, Ghana and Paraguay are to be bundled together into Hutchison International Telecoms (HIT), according to a filing yesterday with the Hong Kong stock exchange. Hutchison has not committed to a date for the IPO and will retain a majority stake in what analysts estimate should be a $4bn company, set to bring Li Ka-Shing's conglomerate about $1bn in cash. Hutchison will split the world with its new autonomous subsidiary, hanging on to Western Europe, North America, New Zealand and Australia. It describes these as "established markets with distinct management and risk profiles" from the rest of the world territory allotted to HIT. Nokia clicks with camera phones Nokia has overtaken a strong Asian lead and moved into the lead in the camera phone stakes and it looks like staying in there and pulling away from what is now a neck-and-neck fixture, according to consultants Strategy Analytics. The Finnish phone group grabbed 14 per cent of the global market in the fourth quarter of 2003 with 4.5 million shipments and a total of 11 million over the year as a whole. For the year, it was pipped by NEC, which shipped 13.1 million phones. However, Strategy sees Samsung as Nokia's only challenger this year. Nokia now has a 35 per cent share of the entire mobile phone market. Wi-Fi and VoIP: A perfect partnership? Wireless local area networks and Net-based phoning have been among the most talked-about emerging technologies for businesses over the past year, and now, vendors are introducing products they say will help companies combine the two. Equipment vendors have been targeting these markets separately, but so far, adoption has been slow. According to a study Forrester Research conducted, only about 20 percent of the 818 companies Forrester surveyed said they had completed or were in the process of rolling out Wi-Fi or wireless LANs. About 15 percent said they had completed or were in the process of rolling out voice over Internet Protocol systems"As companies build out their next-generation IP infrastructures, they want one highly available and secure network for their wired LAN and their wireless LAN," said Brian Witt, director of product marketing for Alcatel. "We can offer them the gear to do this. Voice over wireless LAN will be just one service that runs over this infrastructure." But in order for VoIP over Wi-Fi to really take off, it will also have to combine cellular technology, said Joel Conover, an analyst at Current Analysis. Motorola has already started talking about delivering handsets that support both cellular and Wi-Fi access. The company is partnering with VoIP gear maker Avaya and Wi-Fi equipment manufacturer Proxim to develop products that combine cellular, VoIP and wireless technology. Alcatel and Nortel said the handsets they announced Monday will only support Wi-Fi access. COMPUTER NEWS US still bleating on about EU Microsoft ruling The US State Department has risked further accusations of protectionism by expressing its concerns to European regulators about last week's decision to levy harsh penalties and a €497 fine on Microsoft. The quiet protest from the Bush administration comes as concern is growing on Capitol Hill over the European Commission's penalties, which came after the Justice Department agreed to a consent decree that includes ongoing federal court oversight of Microsoft's business practices. A US government official, who has direct knowledge of the concerns communicated to EU regulators, said: "The State Department has been involved in an off-the-record attempt to focus their attention" on the harm the decision could bring about. A State Department representative declined to comment. US politicians gave at least six speeches over a three-day period last week on the floor of the Senate and House of Representatives, all of which condemned European Competition Commissioner Mario Monti's ruling that Microsoft violated antitrust laws and would have to unbundle Media Player from Windows. The strongest denunciation came from Senate Majority Leader Bill Frist, who said: "I now fear that the US and EU are heading toward a new trade war - and that the commission's ruling against Microsoft is the first shot." Microsoft faces $600m fine European regulators plan to levy a record fine of more than $600m against Microsoft as part of what is expected to be a strongly worded rebuke of the company's business practices. The ruling, which is set to be announced on Wednesday, is expected to include a fine approaching $617m (£335m), according to a source. In addition, the commission is expected to endorse its preliminary finding that Microsoft abused its monopoly power and to order the company to offer a version of Windows without Windows Media Player. Microsoft would also be required to make it easier for rivals to interact with its server software. EDS in $2bn sell-off Electronic Data Systems on Sunday said it has agreed to sell a software development unit to three buyout firms for $2.05bn in cash as part of a plan to sell assets that are not part of its primary business. Under the terms of the deal, Plano, Texas-based EDS will sell its UGS PLM Solutions division to Bain Capital, Silver Lake Partners and Warburg Pincus. The three funds will each hold an equal stake in the unit. The purchase, expected to close within 90 days, represents the largest-ever investment by private equity firms in a technology company, with the purchase price about 2.3 times the unit's annual revenue, according to EDS. INTERNET AND MEDIA Microsoft unveils online song shop Microsoft said on Friday that the second half of the year will see the launch of its online music store, a long-expected entry into an increasingly crowded business dominated by Apple Computer's iTunes. The software giant this week began offering sneak peaks of the service to independent record labels at the South by Southwest trade show in Austin, Texas. Though Microsoft remains mum about specific details, this week's show signals the company's heightened ambitions to enter the world of online music sales with a bang. AOL blocks websites to scupper spammers AOL is claiming that it's winning the battle against spam but its latest tactic of blocking access to spammers' websites hasn't gone down well with everyone. The theory behind AOL's latest anti-spam tactic is that by blocking access to spammers' homepages, where users go to buy the goods the bulk mailers are flogging, it will cut off the spammers' incomes and make the whole junk email racket not financially worthwhile for them. Mobile Internet looks to get its own domain Now that WAP finally looks to be taking off, the mobile industry is setting its sights on driving take-up by making things easier for users – with a top level domain just for mobile content. The industry coalition backing the initiative includes such heavyweights as Microsoft, Sun, the GSM Association, Nokia, Vodafone, HP, Orange and 3, among others, has requested a mobile domain name from internet regulator Icann, which the group hopes will "be a big key step in bridging the world of mobility and the internet". NTL signs up customer number one million NTL has announced that it has signed up its one-millionth broadband customer, demonstrating that UK web users are flocking to get high-speed Internet connections over cable as well as ADSL. The cable operator, which now has more broadband users than narrowband ones, forecast that the majority of web users will be using a broadband connection by 2006. By 2010, 50 per cent of all homes will be on broadband, NTL predicted. Broadband rekindling some dot-com ventures Many failed dot-com ideas could soon get another chance, thanks to broadband. That's the view of Ian Pearson, futurologist and director at BT Exact. In a new report on the impact and potential of broadband, Pearson argues that the dot-com boom failed partly because few people had a rapid and reliable way of accessing information via the Internet. In 2000, when the dot-com industry hit trouble, almost all home Internet users, and many small businesses, only had a narrowband connection. Four years later, broadband take-up is buoyant in most countries but many of the companies that sprung up in the 1990s have collapsed. Virgin to launch online music store this summer British billionaire Richard Branson's latest company, Virgin Digital, is developing its own digital jukebox and online music store with music delivery company MusicNet that will be available by the end of August. Newly launched Virgin Digital, with offices in Los Angeles and London, is part of Virgin Group, which includes an airline, a record label, mobile phone service, Virgin Megastores and other assets. The Virgin Digital software product, which will be available for download through the internet and on CD that Virgin will make available in its record stores and other avenues, will support Microsoft's Windows Media Audio, or WMA, format, Zalon said. OTHER TECHNOLOGY NEWS CeBIT triggers industry upturn? The CeBIT 2004 show in Hannover (18th to 24th March) indicated that the ICT market might have flattened in its decline of recent years. Visitor numbers were down by about 50,000 on last year at around 510,000 and a reduction in the number of exhibitors by nearly 200. However, these were considerably less pessimistic than the CeBIT 2003 show, when the attendance was down by 17 per cent on 2002. In addition, CeBIT 2004 was one day shorter than, 2003 and daily attendance had increased in 2004. Around 25% of this year’s visitors came from abroad, with Asia Pacific generating a record total of 27,800 attendees. Visitors from the People’s Republic of China and Taiwan almost doubled, with 7,400 trade professionals coming from these regions. The US attendance statistics in the wake of the post 9/11 slump during the past two years have also rose significantly to 3,100 visitors from 1,900 in 2003. One billion people to get biometrics and RFID tracking by 2015 Civil liberties groups from both sides of the Atlantic have joined forces to oppose the proposed introduction and cross-border sharing of biometrics and RFID in more than one billion passports worldwide. Human rights organisations from Europe, North America, Australia and Asia have sent an open letter to the International Civil Aviation Organisation (ICAO) railing against plans to create an international 'identity register' that would force the inclusion of biometrics and controversial RFID tracking tags in all passports by 2015. IT budget boost forecast for 2004 In a boost for technology companies, Forrester Research has raised its forecast for US information technology spending growth in 2004 from four per cent to five per cent. That conclusion follows other reports indicating the market for technology purchases is getting at least a little healthier. A Gartner survey of 956 business IT leaders worldwide found that they expect to raise their technology budgets by an average of 1.4 per cent in 2004. But not all the news from Forrester was positive. The company said a survey of 112 North American CIOs showed that for the remainder of the year, 19 per cent plan to spend less on IT than currently budgeted. Fifty-six per cent expect their spending to remain right at the budgeted run rate for the rest of the year. Just 25 per cent of CIOs polled plan to spend more than budgeted, according to Forrester. XML gets eBay and Microsoft into bed Microsoft announced a partnership with eBay on Monday that will allow Office applications to tie in to the online auction service. The software giant plans to offer free sample code through the eBay Developers Program and later Microsoft's MSDN developer site for tying selected Office applications to the auctioneer's listing servers. The eBay Developers Program is a venue for developers to create programs that help large-scale sellers on the site manage inventory, automate listings and other tasks. September - October 2004 TELECOM & NETWORK NEWS Telcos plan to run VoIP out of town The traditional phone companies are trying to stifle innovation in next-generation IP services, according to equipment makers. Old-school telecoms operators are suspected of scheming behind the scenes in an attempt to hamper the new wave of companies offering IP-based telephony services. Bert Whyte, chief executive of net.com - a maker of broadband telecoms equipment - claimed that incumbents are lobbying regulators and governments in an attempt to stop Voice-over-Internet Protocol (VoIP) providers damaging their existing profitable voice services. Ofcom, the UK's communications regulator, is currently deciding how VoIP should be regulated in Britain. C&W challenges BT with faster broadband Cable & Wireless has unveiled an ambitious plan to challenge BT by offering its own wholesale broadband services from hundreds of BT's local telephone exchanges. C&W said that it is committing up to £100m to the scheme, which follows its takeover of Bulldog Communications. It is targeting around 400 exchanges in urban areas, which will allow it to reach almost a third of UK homes and businesses. It will offer broadband at speeds up to 4Mbps - much faster than the broadband that is on offer from BT at present. Cisco gives router family a VoIP facelift Cisco has introduced a faster, more feature-laden versions of its hot-selling access routers, in an attempt to fend off competition from rivals Juniper Networks and 3Com. Cisco's new 1800, 2800 and 3800 wide area network access routers feature embedded security tools and support voice over Internet Protocol (VoIP), said Mike Volpi, senior vice president and general manager for Cisco's routing technology group. VoIP is a technology for making phone calls using the unregulated Internet, rather than the heavily regulated and taxed traditional phone network. VoIP users to get new phone numbers Ofcom has begun to lay out the future for commercial voice over IP (VoIP) services in the UK. The communications regulator announced that Internet telephony service providers will be able to offer both geographic and non-geographic numbers to their customers. Geographic numbers will begin with 01 or 02, like today's existing fixed-line telephone numbers. This will allow consumers to shift onto a VoIP service but retain their existing number, or choose another that indicates where they are located. Non-geographic numbers for VoIP will begin with 056. These will be suitable for people who want to use their Internet telephony service from a number of locations. For example, they could install the necessary software on their laptop and be contactable anywhere over a GPRS or 3G link. MOBILE NEWS O2 3G plans revealed at last O2 has fleshed out its long-expected 3G plans - though it seems to be in no hurry to catch up with launches from its main UK rivals, T-Mobile, Orange and Vodafone. The operator is plumping for a combined wireless offering called O2 Connection Manager. It brings together GPRS (sometimes called 2.5G), 3G and wireless LAN connectivity, through deals with The Cloud and BT Openzone. However, the launch comes with a degree of caution and what some will see as a side-swipe at rivals such as Vodafone. Vodafone to slash costs and boost revenue Vodafone said that it plans to slash costs by £1.4bn and boost revenue by another £1.1bn - increasing cash flow by £2.5bn by 2008. Speaking in a webcast to investors and analysts, Vodafone CEO Arun Sarin added the company would also cut expenditure on mobile phones to 10 per cent of mobile revenue. This works out to £300m a year, which the company plans to save by negotiating bulk deals for handsets. Vodafone announced a £12.6bn pre-tax profit in May, but this was turned into a £9bn loss through a write-off of goodwill. Shares dropped by six per cent to 128p on the news. UK's £3.35bn 3G tax bill to be refunded? Things are looking up for the UK's mobile operators – they could be about to get £3.35bn back from the taxman if they're found to have paid too much for their 3G licences. The case is about whether the prices that the operators bought their 3G licences included VAT. When the licences were auctioned off in 2002, it was assumed they didn't – leaving operators to pay an additional 17.5 per cent on top. The five main operators who bought licences worth some £22.5bn in total have taken their case to court in the hope of seeing that VAT bill cancelled and the money returned. Should the decision favour the operators, its knock-on effect would prove unpopular across Europe, where the continent's governments have raked in over €1bn from selling third-generation licences. Worldwide phone sales boom as Nokia share shrinks Despite a practically saturated west European market, mobile phone sales are still booming, driven by mature markets clamouring to update their phones and young markets wanting to get on the phone-owning ladder. According to Gartner's quarterly review of phone sales, global mobile sales for the second quarter of this year rose by 35 per cent compared to Q2 2003, with 156.4 million handsets sold. In Europe, the analyst house says the natural replacement cycle for people who got their first phones in 2000 or 2001 means it's now time for them to switch to colour screen camera phones. 'World's first' mobile with its own hard drive revealed The convergence of mobile phones and other portable devices has shuffled another step forward - Samsung has launched a handset that contained a 1.5GB hard drive with a one-inch diameter. Samsung has claimed that the SPH-V5400, which was launched in Japan, is the first mobile phone to include a hard drive. Users will be able to store a wide range of different media types on it, including digital music files and photos. With an estimated retail price of $800, according to the IDG News Service, the SPG-V5400 is a relatively expensive way of buying storage capacity. COMPUTER NEWS EU will approve Oracle-PeopleSoft deal Following a legal victory for Oracle in a US court, the European Commission is set to rule on the takeover of PeopleSoft before Mario Monti leaves office Sources familiar with the situation said that the European Commission has resumed its probe of Oracle's $7.7bn hostile attempt to buy PeopleSoft, in a bid to complete approval before Competition Commissioner Mario Monti leaves office,. The new deadline for Commission action is 9 November, nine days after Monti is due to leave office. Nonetheless, the Commission is aiming to complete its work before then. Can India remain the offshore leader? This week's news that the big Indian offshore IT firms are looking to set up bases in Central and Eastern Europe indicates a shift in the offshoring market. While India still dominates, a more mature global outsourcing model is beginning to emerge. The focus is now on the former communist countries in Eastern Europe. The Czech Republic has had a head start over most and established something of a fledgling 'nearshore' industry for firms that want the offshore cost savings without going as far as India. The big draw for the Czech Republic is the labour arbitrage and English language skills. The Czech universities have a history of turning out highly skilled technical graduates - a legacy of the communist era - and the gross monthly salary for an IT operator in Prague is around €600 compared to nearer €1800 in parts of the UK. Novell claims Microsoft has taken $60bn out of IT industry Microsoft has sucked billions of dollars out of the IT industry that could have been spent in more fruitful ways, according to Novell. Speaking at BrainShare Europe, Novell's annual conference held in Barcelona, CEO Jack Messman told customers and partners that Microsoft's extensive licence fees for Windows have prevented end-user organisations and independent software developers from directing cash into more "innovative" software. The solution, according to the Novell boss, will come through the open source software movement, which will force the further commoditisation of client and server operating systems. That, in turn, will enable companies to spend more on development further up the application stack, Messman said. Apple Macs look great but in someone else's office Apple's new-look G5 has attracted plaudits for its aesthetic appeal and much 'must get one' fervour among Mac devotees, but it appears there is a still a 'save it for home' attitude among UK firms, which see little scope for Apple in the workplace. The results of a recent survey show there is little or no place for such 'un-PC' aesthetics. While 12 per cent of respondents say they would really have to make a good case for Macs before their company considered the switch, 41 per cent said 'No': Apple Macs are definitely not an option in their workplace. UK scientists demonstrate world's biggest grid UK scientists have demonstrated the world's largest grid computing project. The grid is made up of over 6,000 machines, with over 1,000 in the UK alone, stretching across 78 countries. The project is part of the Large Hadron Collider Computing Grid (LCG) - the world's largest and first permanent grid, destined to carry out research into particle physics. The scientists expect the grid to process 15 petabytes of data annually (15 million, billion bytes). The boffins' dreams don't end there - they're hoping to push the grid bigger still. INTERNET NEWS Spam crackdown signs up 15 countries An impressive 15 countries have signed up to the 'London Action Plan on Spam' - the first fruit of the anti-spam enforcement summit held recently in London, jointly hosted by the Office of Fair Trading and the US Federal Trade Commission. Among those on the list are representative bodies from Australian, Korea, the UK and importantly the US, which generates around half the world's spam email traffic. Those conspicuous by their absence include, most notably, China and Russia who also play a huge part in generating and sending unsolicited email - particularly China, where many spammers use servers based in Beijing. London the busiest Internet hub The UK has the busiest Internet hub on the planet. A statement from the London Internet Exchange (Linx) this week says that the facility in London's Docklands now handles 55 gigabits of traffic - or 55,000,000,000 bits - per second. This puts the hub - for a long time one of the world's busiest - ahead of similar facilities in the US and Japan. Linx was founded 10 years ago by five UK ISPs. At the same time, the latest research estimates that the UK passed the five million broadband lines mark during September. Intel touts the new Internet The Internet needs to be upgraded with a new layer of abilities that will deal with imminent problems of capacity, security and reliability, according to Intel CTO Pat Gelsinger. Gelsinger pointed to PlanetLab, an experimental network that sits on top of the Internet, as a step in the right direction. HP and Intel have begun work trying to commercialise the project, which was started in 2002, in order to overlay the Internet with intelligence and adaptability. And the Public Broadcasting Service will use Planet Lab to broadcast high-definition TV shows, Gelsinger said in a speech at the Intel Developer Forum in San Francisco.