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Volume 2, Issue 98: Friday, August 25, 2000
- "Web Retailers Lead in Internet Job Cuts"
Los Angeles Times (08/25/00) P. C2
Dot-com layoffs rose 55 percent from July to August, taking an especially heavy toll on the online retail sector, according to outplacement company Challenger, Gray & Christmas. Online firms cut 11,785 jobs between last December and Aug. 23, compared with 7,592 layoffs through July 23. Web retailers took the brunt of these layoffs, losing 3,562 jobs through Aug. 23, up from 1,750 through July. The ongoing shakeout in the online retail sector last week claimed its most recent high-profile victim, Kozmo.com, which announced plans to cut 275 workers and delay its initial public offering.
- "Siebel Party Crasher May Be Big One--Oracle"
Investor's Business Daily (08/25/00) P. A12; Watkins, Steve
Oracle will challenge Siebel's dominance of the $2.5-billion-a-year market for customer-relationship management software, Lehman Bros. analyst Neil Herman revealed this week. Herman reported, "Oracle is set to launch a free, hosted version of its sales force automation offering, with other (customer-relationship) revenue opportunities surrounding that solution." However, other analysts disregard the potential impact of Oracle's offering, noting Siebel generally targets high-end businesses, while Oracle's free service will probably appeal to smaller businesses. Wall Street seemed to favor this assessment. Although Siebel's stock plunged after Oracle's announcement Wednesday, it regained its value by Thursday.
- "It's a Man's New Economy"
Financial Times (08/25/00) P. 8; Griffith, Victoria
Women are still struggling to find executive positions in the new dot-com economy, and some observers fear dot-coms will only become more exclusive to men. Currently, women fill only 3 percent of board positions in new-economy companies, according to a study by the research group Spencer Stuart. Observers expect that figure may fall even further because of the collapse of many e-commerce companies and the rise of Internet infrastructure startups. One anonymous dot-com executive says, "I interview even fewer women than I did a year ago for management positions, and it's scary. This industry seems to get more and more macho as time goes on." Observers blame numerous factors for the lack of women in executive positions. They criticize the media's image of the dot-com world as a sleep-on-the-office-floor, sacrifice-your-family-time way of life, which some say discourages women from entering the field. Observers also note a bias among venture capitalists, an overwhelming majority of whom are men. The attitude against women at dot-coms has become just another part of the culture, critics claim, citing the prevalence of male-oriented dot-com gatherings at golf courses and cigar salons.
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To learn more about ACM's Committee on Women in Computing, visit http://www.acm.org/women.
- "FCC Pulls Plug on Satellite Operators"
Financial Times (08/25/00) P. 5; Leffall, Jabulani
The FCC is regulating the satellite industry more strongly by retracting licenses from several key satellite operators who wanted to use satellite to provide broadband Internet access. Three licenses have been withdrawn from Ka-band satellite systems, the next-generation high-speed satellites set to begin running in 2002. Licenses were revoked in June from Morningside, NetSat 28, and PanAmSat after the companies did not comply with "milestone requirements." The companies plan to appeal the decision. The FCC's requirement of milestones includes the compliance with three progress deadlines associated with the start and finish times of construction and the deployment of high-speed satellites.
- "Whose Intellectual Property Is It, Anyway? The Open Source War"
New York Times (08/24/00) P. E8; Wayner, Peter
Recent court cases have highlighted the continuing battle between corporate intellectual-property interests and proponents of open-source software. The recording and film industries have both filed high profile lawsuits against Web sites that facilitate the copying and distribution of digital music and movie files. In the Hollywood case, film studios sought to prevent anyone from accessing the source code of the DeCSS software that cracks the encryption code on DVD files. This reflects a growing corporate trend to view facts and information as well as products and processes as property. Open-source supporters find this to be restrictive and even harmful to the corporations themselves. They point out that nearly every so-called threat that technology has presented to established industries, from copying machines to the VCR, has in fact helped rather than hurt those industries. Moreover, restrictive measures on intellectual "property" tend to slow innovation, they argue. Despite these recent legal setbacks, open-source supporters continue to gain momentum, if only in the software world. The number of software programs and Web sites based on open-source programs such as Linux or FreeBSD continues to grow, and even major corporations such as Microsoft now rely on open-source software to develop some of their new applications.
For information regarding ACM's activities in the area of intellectual property, visit http://www.acm.org/usacm/copyright.
- "Feds Seek Review of Controversial Carnivore Software"
Associated Press (08/24/00); Sniffen, Michael J.
The Justice Department yesterday placed the details of its Carnivore review plan on its Web site. The posting is 63 pages long and seeks answers to many questions, including whether Carnivore will provide federal agents with greater access to electronic communications than they are entitled to and what kind of protections have been installed to prevent such an occurrence. The DOJ would also like to know whether Carnivore will damage ISPs' networks. David Sobel of the Electronic Privacy Information Center wonders why the government has not yet suspended the FBI's use of the system if such serious questions are being raised about its capabilities.
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For information regarding ACM's activities on behalf of privacy matters, visit http://www.acm.org/usacm/privacy
- "Hollywood to Home Viewer: We Own You"
Washington Post (08/25/00) P. E1; Pegoraro, Rob
The film industry's continuing efforts to eliminate DeCSS, the software that breaks the encryption codes on DVD files, threaten the rights of consumers, according to some observers. For example, a recent court ruling against an online magazine that had posted links to the DeCSS source code did not heed the magazine's argument that DeCSS has other uses besides piracy, raising the possibility that corporate piracy fears may trample software developers' right to free expression. Producers of content such as films, music, and books seem to want it both ways--to exploit the ease of distribution the Internet offers while clamping down on the freedom of exchange that also exists online. This freedom makes many of the pro-film-industry rulings a moot point--DeCSS and other such programs are nearly impossible to remove from the Internet, meaning the film industry may be engaged in nothing more than the high-profile, high-cost alienation of its customers, some observers believe.
- "High-Tech Hotbed for Car Makers: Lowly Mirror"
Wall Street Journal (08/24/00) P. B1; Shirouzu, Norihiko
Gentex, a Zeeland, Mich.-based auto supplier that has already gained industry renown for its rearview mirrors that dim automatically, is now pushing the rearview mirror as the optimum technology portal for automobiles. The company has introduced a new mirror model that allows drivers to use their cell phones through voice-recognition software and is working on a mirror that will also give drivers email access. Also in the works at Gentex are mirrors with light and rain sensors that can turn on headlights and windshield wipers automatically. Both General Motors and Ford plan to include Gentex mirrors as part of their on-board communications systems. The company's auto-dimming mirrors, which use an "electrochromic" gel to dim or brighten based on outside light sources, have an 85 percent market share. The company is a favorite of both automakers and Wall Street. Its sales reached $262 million last year while its stock has increased 91 percent in the past two years.
- "Some Nations Are Net-Ready, Some Aren't"
Investor's Business Daily (08/23/00) P. A10
Officials who carried out last year's worldwide Y2K readiness effort conducted a study of 42 nations and rated their Net-readiness according to connectivity, information security, technological leadership, worker training, and the business climate. The results indicate that the areas of Central and Southern Europe, which contain countries such as the Czech Republic, Italy, Estonia, Bulgaria, and Hungary, are best-suited for the high-tech industry. Low-rated countries include Saudi Arabia, China, Russia, and South Africa, each of which have some combination of problems, including government regulations, insufficient infrastructure and information security, rampant piracy, and a lack of intellectual property laws, that hampers the progress of high-tech development. Estonia and Taiwan topped the ratings list in all categories.
- "U.S. to Detail Plans on Review of Web Wiretap"
Reuters (08/23/00); Pelofsky, Jeremy
Those interested in examining the details of the Justice Department's Carnivore review will have the chance to do so today, Attorney General Janet Reno announced Wednesday. The plans for the review will be available at the DOJ's Web site at 5p.m. EDT. Reno intends to select the members of the academic review team by Sept. 15. The Web posting is meant to give review team candidates an equal opportunity at understanding the review process, Reno said.
- "Firms Find Web a Weapon in Recruitment"
Investor's Business Daily (08/24/00) P. A8; Howell, Donna
Corporations looking to streamline their recruitment process can now turn to several application service providers that are looking to establish a presence in the $180 billion recruitment market. ASPs can handle nearly every aspect of recruitment, from posting online want ads to processing resumes to ranking job candidates, saving much of the $6,000 it costs the average firm to hire a new employee. Analyst Perry Boyle says, "Eventually, every major corporation will be using some form of 'e-cruitment' services." Last year ASP recruitment accounted for $1 billion, but analysts expect that to rise to more than $25 billion in the next four years. Currently, more than 50 recruitment ASPs are vying for corporate consumers. Analysts expect the next few years will whittle that number through mergers, business failures, or intense competition.
- "Got a Question? You Might Ask answerFriend"
Wall Street Journal (08/24/00) P. B14; Clark, Don
AnswerFriend is one of several companies now offering software designed to respond to questions asked in everyday language. Ask Jeeves, Artificial Life, iPhrase Technologies, Native Minds, and Soliloquy are among the other companies that develop natural language systems. AnswerFriend's software targets companies that want to automate their call centers by allowing customers to ask questions using a Web site text box rather than phone or email. Companies might be able to reduce call center expenses from $75 per question to about 18 cents using the software, says answerFriend CEO Greg Mekikian. BEA Systems plans to use answerFriend to respond to 70 percent of call center inquiries within two years. By comparison, only 10 percent of BEA's customer questions are now answered without the help of an employee. Unlike Ask Jeeves, which finds links to many sites on a relevant topic, answerFriend is designed to search a limited set of resources in great detail. AnswerFriend is tailored for a particular company, and the software is modified over time to suit the type of questions that are asked. Eventually, answerFriend could incorporate voice-recognition technology and respond to inquiries over the phone.
- "Germany Makes Waves With Its New Tax On Personal Surfing of the Web at Work"
Wall Street Journal (08/22/00) P. A22; Rohwedder, Cecilie
The German Finance Ministry has declared that Web surfing during office hours is taxable, a move that online companies and German employers call insane and impractical. "German bureaucrats apparently never run out of ideas to prevent economic growth," says Andreas Schmidt, head of Bertelsmann's e-commerce division. Companies argue that Internet use by office workers is nearly impossible to track, and the cost and red tape of the procedure would dwarf the benefits to tax collectors. The Finance Ministry claims the measure is just part of a larger program designed to offer tax relief for people who use home computers for professional purposes. The surfing tax should hardly affect anyone because it only applies to companies that pay for each minute online as opposed to the flat rate, and to workers whose private surfing expenses exceed 50 marks of company money each month--about 42 hours, says Ministry spokeswoman Andrea Hermannsen. The German division of America Online scoffs at this assessment. "This is the brainchild of some technocrats who are thinking about making an extra buck, rather than thinking about promoting acceptance of the Internet," says AOL Germany spokesman Carsten Meincke. "And they're definitely not thinking of the impression this gives of Germany as a place for business."
- "Deutsche Telekom in Two More Cable Deals"
Financial Times (08/24/00) P. 14; Benoit, Bertrand
Deutsche Telekom is reported to have reached a deal to divest controlling stakes in two of its regional cable networks in south Germany. The agreement could be inked as soon as September and would leave Deutsche Telekom with five networks sold out of the nine the company wants to shed. The first deal may be the sale of a 55 percent stake in a Rhineland Palatinate state network to United Pan-European Communications. The other deal expected is the sale of a 75 percent interest in Deutsche Telekom's Bavarian network to the E-Cable consortium, which includes British Telecommunications division Viag Interkom. While financial details of the deals will not be revealed to the public, the agreements have an estimated value of $3.5 billion to $4 billion.
- "Watching the Web for Viruses"
BBC News Online (08/22/00); Ward, Mark
A group of British email administrators has formed the Enterprise Virus Alert Community (EVAC) to warn one another about potentially destructive computer viruses. EVAC, developed by Alex Morgan, a consultant to Intelisys, issues warnings to its members' mobile phones whenever a member encounters a new or retooled virus. Members can then take measures to remove or quarantine infected emails. Already EVAC has helped stop the Life Stages, or VBS/Stages-A, virus. EVAC believes an early warning is the key to preventing the serious damage that viruses such as Life Stages or Love Bug can cause. "What struck me, and a number of other email administrators, is that these things happen far faster than any updates can help us," Morgan said.
- "E-tailers Spruce Up for Holidays"
Merchants are about to launch Web sites for the Christmas shopping season that are designed to address problems that left one out of four customers "extremely dissatisfied" with online shopping last year, according to Internet research firm cPulse. Among the complaints are a lack of displays and directions that help shoppers easily locate items they want, concerns about online security and misuse of consumers' private information, and unannounced shipping fees of as much as 20 percent of the purchased item's cost. Better search engines, live-chat help services, or phone-back features would improve customer service and would help towards solving some of these problems, says cPulse analyst Jody Dodson. Pledges to keep consumer financial records and purchase histories confidential as well as posted privacy policies, would ease customer security worries, says Dodson. And Web sites should disclose shipping fees more prominently, or add the fees to the products' advertised costs, says cPulse. Shipping problems are another factor. Last month seven e-tailers agreed to pay $1.5 million in civilian penalties when the FTC charged them with U.S. law violation for failing to notify customers of shipping delays. Unveiled August 21, FAO Schwartz's retooled Web site features better navigation, "mouse-over" pop-up menus, and advanced search functions allowing customers to hunt for products according to price, brand, gender, and other features--either separately or combined. The site is integrated with the company's inventory management system, thereby giving consumers a better idea of delivery schedules. Premiering in the fall is a joint Toysrus.com and Amazon.com site that will hopefully operate better than last Christmas, when Toysrus.com was overwhelmed by demand. "There's still quite a bit of retooling that needs to be done," says Dodson.
- "FTC's Swindle: Freedom at Core of Privacy Fears"
Newsbytes (08/22/00); Kelsey, Dick
At the Aspen Summit on Net privacy, Federal Trade Commissioner Orson Swindle concluded that consumer fears and skepticism about privacy and security of personal information found online are based upon possible threats to freedom. The commissioner is unsatisfied with the FTC's recommendation that U.S.-based commercial Web sites post privacy policies, as the FTC has not received enough consumer complaints in this area to warrant such a measure. "Why regulate a business model that first, we can't really define, and secondly we'll probably change in about six or eight months?" Swindle asked. "Scores and scores" of individual Net privacy bills have been handed to Congress, but none will probably make it out of this congressional session, said Rep. Asa Hutchinson (R-Ark.). Hutchinson has proposed that a bipartisan commission be organized to focus on online privacy and similar areas of public concern. Public demands for action give urgency to state legislation of online privacy issues, Hutchinson said. Therefore, federal preemption of state legislation is vital, according to Hutchinson. Whatever privacy policies are ultimately adopted must protect the freedoms of both consumers and online businesses, Swindle said at the Aspen Summit. "We've got to get this right because the harm we could do would be incredibly grave," said Swindle.
For information regarding ACM activities on behalf of privacy matters, visit http://www.acm.org/usacm/privacy.
- "Management By Web"
Business Week (08/28/00) No. 3696, P. 84; Byrne, John A.
The Internet will become the management tool of the 21st century corporation. Outsourcing and partnering will become more crucial, so that a corporate configuration will come to resemble a web of operations and operatives. This configuration will be a competitive advantage, says Cisco CEO John Chambers. Future companies will customize their products for their clients, treating the business-to-buyer relationship as more of a partnership. The most profits will come through the management of bits, or information, rather than a corporation's physical assets; thus, companies will serve customers better and will operate at higher speed, lower cost, and with far less waste. A 21st century business will have to build a reservoir of talent to keep ahead of the new-product curve, and maintain that reservoir with a reward system. The company will also operate on a global scale by employing talent and resources at any location via the Web. The heart of this new corporation will be digitization, which will streamline operations, save money, and increase speed. Efficient companies will be able to raise productivity by 20 percent to 40 percent a year, says Chambers. Businesses such as Enron, formerly a natural-gas pipeline company, are already reaping benefits from Web management. Through the Internet, Enron has transformed itself into a profitable energy and telecommunications center. The 21st century corporation does not yet exist, but many businesses are taking steps in the right direction.
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- "Web Stakeout"
Federal Computer Week (08/14/00) Vol. 14, No. 28, P. 16; Verton, Dan
The confusing legal environment surrounding the Internet has made it difficult for those workers who are responsible for the security of federal agency networks. A recent example is the FBI's Carnivore system, which some members of Congress contend violates search and seizure protections, while the FBI maintains that the system is perfectly legal because it discriminates which email messages it monitors. Relevant to the issue of electronic workplace surveillance is a 1987 Supreme Court decision in the case of O'Connor v. Ortega, in which the court ruled that "searches and seizures by government employers or supervisors of the private property of their employees are subject to Fourth Amendment restraints." In short, employees have a right to be free from electronic search and seizure based on a "reasonable expectation of privacy," which in the case of the Internet is much less than with telephone or even regular mail correspondence. The privacy discrepancy, according to recent court rulings, is based on the nature of the Internet itself and the fact that users cannot control where emails are routed or to whom they are forwarded. One major exception to this rule is when federal agencies alert employees that their correspondence is being monitored via a formal policy. Another important legal ruling for government agencies is the Electronic Communications Privacy Act of 1986, which allows employers to seize employee email and voice mail messages if they are transmitted on a network owned by the government or employer. However, employers must obtain employee permission to monitor correspondence if it is maintained on a system owned by an outside entity.
- "E-Learning Is for Soft Skills, Too"
Planet IT (08/07/00); Swanson, Sandra
Procter & Gamble has begun a program to teach its workers soft skills online. The online courses, provided in part by SkillSoft and NetG U.S., will focus on non-technical topics, including teamwork, leadership, and management. The company believes online training will save both time and money by allowing workers to seek the information they need in a brief period of time. Larry Green, who is leading the company's RapidLearn project, argues, "The ability to get an 80 percent solution today is much more valuable than obtaining a 100 percent solution in a class that's available in three months." Procter & Gamble's efforts are an example of a growing trend among corporations. According to International Data, corporations will spend more for online soft-skills training than for online IT training within the next three years.