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Volume 3, Issue 159: Wednesday, January 31, 2001
- "Job Forecast: Internet's Still Hot"
New York Times--Working (01/30/01) P. 9; McClain, Dylan Loeb
From now until 2008, the five fastest-growing occupations in the United States will be computer-related, according to a new study by the Bureau of Labor Statistics. In 1995, the bureau had predicted that the health-care industry would dominate the job market, but the rise of the Internet and its related industries has propelled high-tech to the forefront of the labor market. The five fastest-growing occupations, in order, are computer engineers, computer support specialists, systems analysts, database administrators, and desktop publishing specialists. In its study the bureau notes that certain computer-related jobs, such as support specialists and database administrators, were once viewed as the same thing but that the diversification of the high-tech industry has led to them being considered separate. Among the occupations that are declining, according to the bureau: typists, accounting clerks, and sewing-machine operators.
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- "Amazon, Facing Slowdown, Cuts 1,300 Jobs"
New York Times (01/31/01) P. C1; Hansell, Saul
In an attempt to achieve profitability by the end of the year despite slowing sales growth, Amazon.com yesterday announced plans to lay off 1,300 employees. Investors ignored the promises and layoffs, dropping Amazon stock 69 cents a share yesterday. Robertson Stephens analyst Lauren Levitan says, "The cuts they made are steps in the right direction, but they don't improve the fundamental economics of their business." Amazon adjusted this year's sales growth expectations to an increase of between 20 percent to 30 percent, compared to a 68 percent increase in 2000. The company's staple sales--books, music, and videos--turned a $39 million profit in 2000 but grew only 11 percent. In 1999, staple sales had gone up 82 percent. Regarding those numbers, Amazon CFO Warren Jenson said the company made a strategic gambit in sacrificing sales growth for profitability when it significantly upped the price of its books. Among the areas cut by Amazon are a distribution center in Georgia and the company's Seattle customer-service center. The customer-service center had made news in recent months as the site of unionization attempts, but Amazon denied that union activity had anything to do with its decision to close it.
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- "Tech Consumers Are Getting Picky"
International Herald Tribune (01/31/01) P. 13; Buerkle, Tom
Hewlett-Packard CEO Carly Fiorina believes that the IT industry has undergone a clear, significant shift in recent months. At the World Economic Forum in Davos, Switzerland, she said consumers and businesses alike are less willing to purchase technology because it is new and fast. Instead, she says they now want technology they can use to improve their business operations or to bring the Internet into their everyday lives. "I think purchasing of technology will be more discriminating. Simply buying a hotter box to replace a hot box is not enough," Fiorina said. She foresees consolidation throughout the IT sector as a way to combat the current economic slowdown, although she will not say whether she thinks that slowdown is temporary or indicative of a larger trend. She said markets still exist for IT firms, especially those that provide e-services to let consumers upload and send content such as photographs and music over the Internet. In the business market, companies will seek out IT firms that can deliver a reliable, intelligent network.
- "Dot-Com Layoffs Up 23 Percent Over December Tally"
Los Angeles Times (01/30/01) P. C1; Girion, Lisa
The number of dot-com layoffs increased 23 percent from December to January, according to a new report from Challenger, Gray & Christmas. The firm announced that approximately 13,000 dot-com employees have lost their jobs this month, the most in any one month since Challenger began monitoring the dot-com sector in December of 1999. In contrast, January of last year saw only 303 dot-com employees laid off. In total, Challenger reports that 54,343 employees from 502 dot-coms have been laid off since December 1999. A separate study from the Center for Research in Electronics Commerce at the University of Texas supports Challenger's findings. The center found that dot-com employment decreased from 362,487 to 360,718 between the first and second quarters of last year. However, dot-com workers may not have to wait very long to find another job. Challenger CEO John Challenger says, "The job market is still very, very receptive." The job market is especially strong for unemployed dot-com workers with tech skills. Those who worked in the marketing or content divisions of dot-coms are having a more difficult time finding a new job, Challenger reports.
- "BIND Holes Mean Big Trouble on the Net"
SecurityFocus.com (01/29/01); Poulsen, Kevin
Security experts from the Computer Emergency Response Team (CERT) warned Monday that two small coding vulnerabilities in BIND name servers could lead to widespread chaos on the Net. BIND name servers translate domain names into the number strings that identify addresses online. The security holes provide hackers with a small window in which to insert dangerous code into these critical systems. Glitches in these servers would resemble the recent Microsoft outages that blocked millions of users' access to its sites, including Hotmail and msn.com. BIND servers, unlike the proprietary Microsoft technology, are ubiquitous to various Unix and Linux operating systems and are the most common name servers in operation today, CERT reports. The security firm Network Associates found the weaknesses in December and informed the Internet Software Consortium, which has since developed upgrades to patch the holes and tried to inform network administrators of the danger. In 1998, a similar scenario with weaknesses in the BIND coding led to a wave of hacker attacks, despite a warning and security patches issued by officials.
- "Music Labels Go Back to School"
Financial Times (01/31/01) P. 20; Harding, James
Napster CEO Hank Barry is blunt about his company's current financial situation. "We have no revenues," he says. "Zero." That could change as early as this summer now that Napster partner Bertelsmann has announced that the file-swapping service will pursue a fee-based model. A Bertelsmann survey found that a majority of Napster users would be willing to pay as much as $15 per month for access to the music database. Barry declines to agree with this fee, saying he favors a lower amount, but concurs that the company believes that its 57 million users are ready to pay for the service. Also, Barry says the company is working on ways to compensate artists and their recording companies when users download their work. Barry hopes that this new policy will persuade the four recording companies that have lawsuits pending against the company to drop their cases and become partners, as Bertelsmann has done. "We have got something that consumers really want and to wait for the court to decide is not really the right response," Barry says. "We should move forward and start paying the artists."
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- "Israel's High-Tech Industry Takes Hits in Its Own Regional Crisis"
Financial Times (01/31/01) P. 21; Machlis, Avi
Israeli tech firms are facing a slowing of foreign investment, in part because of a reduction in global IT spending, analysts report. Rob Goldman, an analyst for US Bancorp Nessuah Zannex, notes that even though most Israeli tech firms escaped the dot-com crash because their base was providing technology and Internet infrastructure, lower worldwide IT budgets still threaten their growth. Both Goldman and Finjan Software director Dave Kroll negate the five-month-old political turmoil plaguing the region. Kroll says the current crisis has not had any real impact on Finjan's day-to-day operations other than small distractions. Credit Suisse First Boston analyst Ehud Helft says the more important concern for Israeli tech companies is the pursuance of "must-have" technologies that will enable them to weather a depressed Nasdaq. For example, the Israeli companies Check Point Software and Amdocs both offer technologies with strong demand and have been able to beat analysts expectations.
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- "SBA Take On Women's Web Resource"
Federal Computer Week Online (01/25/01); Langlois, Greg
The Small Business Administration recently took over the Online Women's Business Center that it helped establish three years ago together with former Vice President Al Gore. Women entrepreneurs use the site to obtain resources gathered from SBA's 93 women's business centers nationwide. SBA officials say the site receives over 2 million hits each month and has been accessed by people in more than 100 different countries. The North Texas Women's Business Development Center, which had been running the site with a $150,000-per-year grant from the SBA, had trouble finding matching donations to the grant funding the site.
- "Gnutella Puts Up Fight for Web Elite"
Heavy Internet traffic continues to plague the file-swapping network Gnutella. Users complain that downloads take too long, hindered by the slower PCs on the network. Those who might have become users complain that the steps to join Gnutella are too complex for average users to understand. Gnutella's team of developers, who had hoped the open-source community would provide some help in improving Gnutella's performance, recently released two minor upgrades for the Gnutella software. However, the developers currently seem focused on Gnutella2, a major upgrade that GnutellaWorld's J.C. Nicholas promises will be an "Internet earthquake." Gnutella supporters made similar claims about the original release of the file-swapping software, which its developers say is immune to the lawsuits that the recording industry and other copyright holders have used to shut down or compromise such file-swapping sites as Scour, MP3.com, and Napster. When a federal judge ordered Napster shut down last summer, the Gnutella developers said their program would quickly fill the gap, and Gnutella traffic did initially increase. However, once an appeals court ordered Napster reopened pending review, which is still ongoing, Gnutella's momentum stopped cold. The Gnutella team says Gnutella2 will solve many of the problems that have frustrated would-be users. "Super peer" computers would take some of the burden from the slowest computers on the network, while a new plug-in would allow the network to act as a "distributed network," in which files are distributed among users' unused hard drive space.
- "Despite Old Economy Veneer, Bush Team Appears Tech-Friendly"
SiliconValley.com (01/29/01); Puzzanghera, Jim
The new Bush administration has a decidedly corporate background, as many of his top-level officials once served as company CEOs and presidents. In addition, many positions have been filled by those with experience in the high-tech sector, including Secretary of State Colin Powell, who served on America Online's board of directors for two years. Also, Secretary of Transportation Norman Mineta and national security advisor Condoleezza Rice both have a deep understanding and experience of Silicon Valley. Observers expect Rice to work together with chief economic advisor Lawrence Lindsey to develop a strategy for integrating economic goals with foreign policy. Leaders in the tech industry are also keeping close tabs on Bush's selection for the position of "high-tech czar," who will coordinate the nation's technology policy. Jeff Modisett, vice president of the Silicon Valley lobbying group TechNet, says many of his members are optimistic about the new administration but adds, "the proof will be in the pudding."
- "For Rent: Software Development Tools"
CNet (01/30/01); Wong, Wylie
Software development tool vendors such as IBM, Borland, and Oracle are increasingly renting their products to software developers via the Web. For companies with an existing infrastructure the classic method of software development is still valid, says Giga Information Group analyst Mike Gilpin, but for those companies without that infrastructure or with a need to move fast, the hosted model is attractive. For software makers the service provider method allows them to promote their development tools among developers, a strategy intended to lead to more extensive and lucrative software sales as their projects progress. The application service provider market will grow 153 percent annually, reaching $4.7 billion by 2004, according to AMR Research.
- "Spotlight on Privacy: Tech Industry Consumer Advocates Set Grapple With Congress Over Pressing Internet Security Issues"
San Francisco Chronicle Online (01/29/01); Kirby, Carrie
Bills that address online privacy are already being introduced in the new House of Representatives. On Jan. 20, Rep. Chris Cannon (R-Utah) introduced legislation to protect the personal information of consumers online. Observers say lawmakers are ready to act on privacy protection because Americans feel so strongly about the issue. Incidences of privacy lapses, such as an attempt by Toysmart to sell its list of consumer information when it went out of business, have only heightened the sensitivity of lawmakers to the issue. Moreover, many lawmakers are ready to go to work on privacy because it is one of the few issues that has bipartisan support. Although the nation's largest tech organization, the American Electronics Association, has publicly said privacy legislation is a likely probability, many tech groups continue to plead for self-regulation. While the industry is closely watching Washington, the states could prove to be even more troublesome if they adopt privacy laws that provide no uniformity for the industry. "[The industry] might be willing to compromise on something," says Ari Schwartz, a policy analyst at the Center for Democracy and Technology. "They don't want to fight it in 50 states." Jay Stanley of Forrester Research suggests that e-commerce would likely take off once privacy rules are in place. In this case, he says, privacy will be a good thing.
- "CEO of Female Entrepreneurs' Forum Finds Calling as Connector"
SiliconValley.com (01/29/01); Seipel, Tracy
Forum for Women Entrepreneurs CEO Denise Brosseau this week will host Springboard 2001, her organization's second annual forum for venture capitalists to meet female entrepreneurs in the high-tech and life-sciences industries. The forum will feature 24 female CEOs describing their businesses to angel investors and venture capitalists. At last year's inaugural event, investors rewarded the 26 female CEOs who participated with a total of $266 million. Brosseau says her non-profit organization has overcome much skepticism since she founded it seven years ago. Although many in the tech industry felt there was no need to assist female CEOs, Brosseau points out that from 1993 to 1997 venture capitalists gave only 1 percent of their funding to firms headed by women. Brosseau says it has now reached nearly 6 percent, while as much as 44 percent of firms that received funding in 1999 had a woman on their management board. Brosseau will continue her efforts even after this week's event. She is opening more branches of her organization around the country, adding to her base of 1,300 members.
To learn more about ACM's Committee on Women in Computing, visit http://www.acm.org/women.
- "Ballmer Steers Microsoft Down More Practical Path"
USA Today (01/29/01) P. 3B; Swartz, Jon
Analysts say Microsoft CEO Steve Ballmer has had a good first year in his new position, especially considering the challenges his company has faced in that time. The government continues to seek the company's split for antitrust violations, while the shrinking PC market threatens to cut the profit margins of the company's signature offering, Windows. Ballmer has responded by launching a risky Internet initiative known as .Net that will push the company away from its software-centered model toward a Web-driven enterprise. The $1 billion project, backed by a recently launched $200 million ad campaign for it and Windows, is a bold move into a market dominated by such Microsoft rivals as Sun Microsystems and Oracle. However, Microsoft employees say Ballmer's leadership style, which has included a cheerleading session for 18,000 employees at a Seattle baseball stadium, has them sold on the plan. Analysts say Ballmer is also improving the public image of Microsoft. "Steve has paid more attention to ameliorate some of the raw feelings Microsoft created. It's a better corporate citizen," remarks Summit Strategies analyst Steve Davis. Although analysts note Microsoft is not out of the woods yet, with an appeal of the antitrust decision against them pending and revenue forecasts down for the upcoming quarter, many both inside and outside of the company say Ballmer's enthusiasm and action-oriented approach is driving the company toward the future.
Steve Ballmer will be one of many industry leaders and visionaries speaking at the upcoming ACM1: Beyond Cyberspace. . .A journey of Many Directions. For more information about the conference, visit http://www.acm.org/acm1.
- "ICANN: One In, Four Out, More TLD Controversy"
Register Online (01/29/01); McCarthy, Kieren
ICANN is continuing its behind the scenes dealings as it announces that Dr. M. Stuart Lynn will become its next president and CEO and that a "comprehensive study" will be done on its at-large membership, according to Kieren McCarthy. Actually, Lynn was selected because he will not take sides, although he will likely be a refreshing replacement for the widely disliked Mike Roberts. However, the committee overseeing the at-large membership study will probably suggest that ICANN reduce the number of at-large board members to five in a move that would give business interests more power. And the committee's report will be done at the coming ICANN meeting, which means Roberts will still be ICANN's CEO. Outsiders are getting fed up with ICANN. In November, the Domain Name Rights Coalition sent a letter to ICANN and the press to reveal its members' displeasure over the idea of ICANN's at-large study. The American Civil Liberties Union wrote the U.S. Commerce Department about ICANN's top level domain selection process, and dotTV recently took some of the credit for U.S. Congress looking into how ICANN selected the new TLDs.
For information regarding ACM's Internet governance work related to ICANN, visit http://www.acm.org/serving/IG.html.
- "Cracking Down on Software Piracy"
IDG News Service (01/26/01); Johnston, Margret
Software pirates are using Internet auction sites to sell illegal copies of programs, according to a white paper the Software and Information Industry Association published Wednesday. The software sellers make use of inexpensive CD-Rewritable drives and then sell illegal software products on eBay, Yahoo, Microsoft's MSNBC.com, and smaller auction sites. The white paper describes a tactic used by software pirates called "email stalking." After software pirates have sold an application to the highest bidder, they contact the other bidders, using auction participants' email addresses that are made public, and offer the program at a price less than the lowest bid. The white paper comes at a time when the Washington-based trade association representing some 1,000 companies has filed separate lawsuits against two men for selling illegal copies of software in such a manner. The SIIA last year conducted a sting operation in which members posed as buyers at auction sites. An SIIA official claims that a pirate contacted him about buying software applications after he was outbid.
- "Linux Looming"
InfoWorld (01/22/01) Vol. 23, No. 4, P. 36; Scannell, Ed
Corporations are showing increased interest in mainframes based on the open source Linux operating system, industry analysts say. IBM, an avid partner of several Linux vendors, recently sold a Linux-based G6 mainframe to Telia, a Scandanavian ISP. Telia will use the mainframe to replace the 35 servers from Sun Microsystems that had been running its billing department. Analysts say many companies are intrigued by Linux because it can run internal systems or Web operations without requiring a large number of machines. The recent release of the Linux 2.4.0 kernel, which will allow Linux to run on high-end servers such as the IBM S/390, has also piqued interest. IBM thinks so highly of Linux's potential value in the mainframe market that it has committed to $1 billion in Linux investment for this year. Analysts speculate that IBM is depending on Linux to increase its revenue, while Linux vendors and IBM partners such as TurboLinux and Red Hat see IBM as increasing their clout among potential customers. IBM's Pete McCaffrery argues, "Linux on mainframes is strategically important to us because it can divide the server into thousands of virtual servers, each running an independent application." However, officials at both Sun and Hewlett-Packard say Linux, while a possibility, is not the best option for companies looking to consolidate their servers. Hewlett-Packard officials say a better choice for companies would be to move to smaller servers, which have a shorter upgrade cycle. Other critics question whether there are enough applications for Linux mainframes, while some even doubt whether Linux mainframes would actually offer any cost savings. A recent study by the consulting firm Sine Nomini found that running 750 Sun servers would cost $55 million, while a single Linux-based IBM S/390 server would cost only $7 million. However, critics note that the study did not take into account the cost of shifting to a Linux-based mainframe.
- "The Failings of Distance Learning"
Computerworld (01/29/01) Vol. 35, No. 5, P. 68; Deakin, Michelle Bates
Employees have begun to voice their frustration with online learning programs implemented by their companies. Rick Toomey, a technical engineer for Sprint, complained after a recent virtual-training exercise that, while he saw the economic sense in conducting training over the Internet, it is very hard to sit at a computer, ignore email and other distractions, and focus solely on the lesson at hand. "It takes a certain kind of discipline," he said. Many others who have tried online training have acknowledged similar uneasiness. Complaints have included the lack of interaction between students and instructors and the absence of hands-on simulations. Those who have tried the programs say they are particularly ill-suited to advanced topics. Although some companies have tried to compromise by offering online tutorial programs that allow employees to proceed at their own pace, employers note that it can be difficult to tell if employees are progressing as they should. Recommendations for improving online training range from including more "bells and whistles" to prevent employees' attention from wandering to conducting the online lessons in special email- and phone-free areas so as to minimize outside concerns.
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- "Computing Goes Everywhere"
Technology Review (02/01) Vol. 104, No. 1, P. 53; Buderi, Robert
Ubiquitous computing is the holy Grail of many electronics companies, a system in which humans will be able to power or operate virtually anything on their own terms using portable devices or by accessing a vast network. The foundation of a ubiquitous computing system is the 24/7/360 framework--computational power and services that are available at all times and in all places. One 24/7/360 methodology focuses on embedding computing power in ever-shrinking devices, while another emphasizes creating a network that users can tap into. AT&T Laboratories Cambridge's Virtual Network Computing (VNC) software provides a remote display for virtually any desktop device that operates on standard telephone lines and cell phones. VNC offers cross-platform appeal, while Sun aims to offer access to secure, file-sharing supernets through Public Utility Computing (PUC) technology. Companies would only have to pay for whatever PUC systems they require, but a solution to provide secure hardware and software to prevent inadvertent file copying is still in the early phase. The goal of AT&T's VoiceTone project is to turn ordinary phones into computer interfaces that enable callers to carry out tasks over the line by voice commands. Another step toward ubiquitous computing is the development of context-aware computing, a controversial move because of the privacy issues involved. One context-aware device is AT&T's "bat," a badge with an ultrasound transmitter that tracks people and objects. Radio-frequency ID tags, or e-tags, are small enough to carry in everyday objects and feature inductive coupling. Bots are software agents that can operate free of human interaction, and the next generation will be able to search out bargains, negotiate deals, and coordinate numerous services using statistical reasoning. Microsoft is developing context-aware bots that can filter email, phone calls, and news alerts to stave off information overload, while SRI has demonstrated car-to-refrigerator software that can facilitate the actions of other software agents. An even more ambitious goal is the "digital companion," an electronic agent that can adapt to human needs on a wider scale.