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Volume 3, Issue 234: Wednesday, August 1, 2001
- "Increase in Software Piracy Could Blight Financial Future"
USA Today (08/01/01) P. B1; Iwata, Edward
Software piracy eats up 15 percent of the industry's worldwide sales, or about $12 billion out of an $80 billion total. Despite increased government efforts to stem such illegal copying, pirated software circulation actually rose last year from 36 percent in 1999 to 37 percent in 2000. Heavy government crackdowns have reduced those levels from the rampant 45 percent piracy rate found in 1995, meaning nearly half of all software sold was illegal. U.S. Attorney General John Ashcroft recently announced an increase in the number of Justice Department officials and FBI agents targeting cybercrime, but software pirates are also organizing and coordinating efforts. Authorities have tied software piracy to organized syndicates such as the Hezbollah, Irish Republican Army, and Chinese, Italian, and Russian crime rings. These criminals employ $1 million software replicating machines to turn out thousands of illegal CDs per day and distribute them through networks so intricate the illegal copies often turn up in businesses and government offices. Software pirates are also using the Internet, where they are constantly changing Web sites, emails, and physical addresses to stay ahead of investigators hired by the likes of Microsoft and Adobe.
- "'Code Red' Unleashed on Web"
Los Angeles Times (08/01/01) P. C3; Piller, Charles
A malicious computer worm is spreading over the Internet, causing infected computers to search the Web to find more victims. Eventually the Code Red worm, which only recently began its spread, will cause its host computers to deluge the White House Web site with a barrage of data. However, a previous version of the worm was released earlier last month against the same White House target. That version also defaced the Web sites hosted on the servers it infected with a message claiming "Hacked by Chinese," though the Chinese government has denied the worm originated in that country. Officials at the White House have since used an address-change technique to divert the data flow from Code Red computers, and the site will also remain safe from the current version. Code Red, however, will continue to spread, reaching its peak within 36 hours of its August 1st release date, according to Internet Security Systems researcher Chris Rouland. The worm is programmed to go dormant on August 28th.
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- "Salaries Not Top Concern for IT Pros"
CyberAtlas (07/31/01); Pastore, Michael
New technologies, learning, and a challenging environment are more highly valued by IT workers than competitive salaries, according to a people3 survey. "It is absolutely essential for IT and human resource leaders to have the right programs and policies in place to attract and retain IT staff during the next few critical years," says people3 president and CEO Linda Pittenger. The survey also found that network architects and database administrators are the hardest jobs to fill, respectively taking an average of 4.2 months and 3.7 months to fill. The average salary for all polled IT jobs was $62,100, an increase of 1.8 percent compared to last year. System programming jobs enjoyed the biggest salary increase. Similarly, a Computerworld IT survey found that IT professionals are generally satisfied with their jobs but crave more challenge, training, and advancement opportunities.
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- "Analysts: More High-Tech Job Cuts Possible This Year"
NewsFactor Network (07/30/01); DeLong, Daniel F.
A number of analysts are admitting there could be significantly more job cuts yet to come in the high-tech sector before the economy clears. Deutsche Banc Alexander Brown analyst Edward Yardeni says managers are trying to discern an upturn in sales, and will likely decide to lay off more workers if a recovery does not materialize soon. Layoffs rose again in June and July, after falling in May. And many of the recently announced cutbacks--such as the 33,000 layoffs announced last week by companies such as Hewlett-Packard, JDS Uniphase, and Lucent--will not be tallied in government totals until later in the year when workers actually leave. Layoffs for this year have so far doubled last year's amount, raising the unemployment figure to 4.5 percent, up from 3.9 percent last October--still far off full-recession numbers, note analysts. The Information Technology Association of America expects 900,000 job openings in the high-tech sector this year. Other observers are seeing a bright side to slowing cutbacks in the dot-com economy, which may be signaling the bottoming-out of the downturn, according to Challenger, Gray, & Christmas CEO John A. Challenger.
- "Japan's Troubled High-Tech Sector Hinders a Recovery"
Wall Street Journal (08/01/01) P. A8; Guth, Robert A.
Japanese electronics giants such as Matsushita Electric Industrial and NEC are reporting layoffs, consolidations, capital investment slashes, and bleak earnings forecasts in the wake of the economic downturn. Industrial output is close to 1998 levels, the low point of Japan's economic collapse in the 1990s. The electronics sector's recovery is also being hampered by an accumulation of declining shipments while competitors continue to grow. These rivals hail from Taiwan and South Korea, while American companies such as IBM add to the pressure. Dataquest expects a 17 percent shrinkage of worldwide chip sales as a result of falling cell phone and PC shipments. Meanwhile, dynamic random access memory (DRAM) chip sales will experience a 56 percent decrease this year.
- "An Idea From the Ladies' Room"
Financial Times (08/01/01) P. 10; Maitland, Alison
Women in the technology industry can interact and gain advice from each other both online and in person through HighTech Women, a forum created by Lucy Marcus, head of Marcus Venture Consulting. Marcus says the central topic of the forum is the progress of women throughout their careers as directors. HighTech Women also hosts a "pool of directors" that companies can use to find first-time or veteran directors. Marcus describes herself as a maverick and credits her take-charge and personable attitude to a large number of mentors. One mentor she cites in particular is Jim King, one time head of Washington's office of personnel management, who taught her the importance of honesty and integrity. HighTech Women currently plays host to 1,700 members worldwide.
To learn about ACM's Committee for Women in Computing, visit http://www.acm.org/women.
- "Two Women Retreat From Dot-Com High Without Seeing Summit"
Wall Street Journal (08/01/01) P. B1; Stout, Hilary
The owners of Dailey & O'Brien, a management consulting firm, quit their business last year to launch an Internet startup company marketing financial planning software for women. Nancy Dailey and Kelly O'Brien, however, are now back at their consulting business after a year-long ordeal which included a multi-million-dollar deal with iVillage, the failed women's Internet portal, and a long string of investments and personal debt. Their idea, MoneyLife, was a software program that would analyze data entered by women online and respond with financial planning advice. Online banks and financial services could license the technology to market their wares on the Internet as well as gather critical marketing data. Though MoneyLife never took off--the deal with iVillage involved the rights to the MoneyLife name--Dailey and O'Brien received and then sought venture capital to fund their startup. Finally, after failing to convince skittish investors--who had once offered capital based on a company valuation of $15 million--the pair gave up, took the lessons learned, and now are back doing consulting again.
- "Software Is Called Capable of Copying Any Human Voice"
New York Times (07/31/01) P. A1; Guernsey, Lisa
Natural Voices is new text-to-speech software from AT&T Labs that reportedly makes voice cloning a reality. AT&T claims that the software can recreate voices, even those of long-deceased celebrities. "Natural Voices gets into the gray area where there is plausible deniability that it is a machine," says Benetech CEO James R. Fruchterman. Text-to-speech can flow much more smoothly thanks to the falling cost and rising speed of microprocessors, says AT&T Labs Research's Lawrence R. Rabiner. The technology could find applications in automated voice devices, books-on-tape, automobiles, video games, and telephone call centers, but it also raises some thorny legal issues. There are questions about whether it could be used for fraud, although scientists say the technology is not mature enough; ownership and licensing of celebrity voices is another contentious matter. Natural Voices will be the first product that AT&T Labs actually sells, and McKinsey & Company analysts anticipate the market for text-to-speech software to exceed $1 billion in the next five years.
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- "Wanted: E-Commerce Leaders to Show Government the Way"
E-Commerce Times (07/27/01); Greenberg, Paul A.
The Internet is looming larger on the legislative horizon as the Bush administration and Congress prepare to tackle key privacy, security, cybercrime, and taxation issues on the Web. Already, several moves have been made by the Bush team to address criminal activities online and security. President Bush has announced he will form a oversight board for Internet security that will coordinate efforts between the intelligence agencies and the Commerce and State departments. Attorney General John Ashcroft also designated 10 new Justice Department teams to combat cybercrime activities such as corporate espionage, hacking, and digital piracy. Congress is looking to follow the Executive Branch with laws regulating e-commerce. The E-Government Act of 2001, proposed by Sen. Joseph Lieberman (D-Conn.) and Sen. Conrad Burns (R-Mont.), if passed, promises to push forward key standards issues that will enable more widespread e-commerce in advance of the expiration of the moratorium on Internet taxes in October.
- "House Approves High Tech Export Controls Extension"
Associated Press (07/30/01); Abrams, Jim
The House of Representatives today vocally passed a bill to extend the Export Administration Act by another three months in the hopes of giving the House and Senate time to revamp the system and eliminate some of the export limitations on computers that date back to the days of the Cold War. The Bush administration champions the bill, stating that the measure "would allow the United States to successfully meet its national security and foreign policy objectives without impairing the ability of U.S. companies to compete effectively in the global marketplace." President Bush will likely enforce the extension through executive power if the bill is not approved by the Senate. In April 2000, the Senate mulled over a proposal to cast off many export strictures on mass-market devices that have both commercial and military applications, but eventually shelved the bill. This Wednesday a similar bill will pass through the House International Relations Committee, one that grants Congress more leverage on the export of parts used to build North Korean nuclear reactors.
- "At Nanoscale, the Laws of Humans May Not Apply"
Small Times (07/30/01); Becker, Michael
Developments in the field of nanotechnology will have far-reaching legal and regulatory implications, just as the Internet and biotechnology have. For example, the micron-sized respirocyte is a nanodevice that could theoretically replace red blood cells, but categorizing it as a medical device, a drug, or something else entirely will be a matter of debate. A method must also be worked out for testing, monitoring, and approving such technology. The biggest source of concern revolves around copyright and patent issues, especially if self-replicating and adaptable nanodevices can be manufactured. Experts agree that the design, rather than the nanodevice itself, would be considered intellectual property. Some researchers are pushing for an open source approach to nanotechnology in which no one person or firm owns a copyright or patent. Since the pollution yielded from nanotechnology manufacturing would be minimal to nonexistent, environmental statues could become even tighter, posits Zyvex research scientist Robert Freitas. The potential for self-replicating nanotechnologies to be used for destruction may also force the reassessment of accords that restrict the use of biological and chemical weapons.
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- "Computers of the Future: Made of Glass?"
IDG News Service (07/27/01); Williams, Martyn
All the functions of PDAs and even computers could one day be built into a small glass panel. The slow mobility of electrons on glass has thus far limited the complexity of integrated circuits that can be installed on a glass substrate. A new process developed at Fujitsu Laboratories allows engineers to create display crystals with greater mobility at a temperature below 450 degrees Celsius, thus keeping the substrate from melting or warping. "Our objective is making a processor or memory on the glass substrate, so we are now developing some basic components of processors and memory on glass," says Fujitsu engineer Nobuo Sasaki. Directly mounting components onto glass will save significant manufacturing costs. Sasaki estimates that handheld computers constructed out of glass sheets could hit the market as early as 2003.
- "Israel Beats 'Cyber-Jihad' Attacks"
Washington Times (08/01/01) P. A11; Barber, Ben
Cyber-attacks by pro-Palestinians targeting Israeli and Jewish Web sites, known as e-jihad, may in the future be focused on U.S. government and commercial sites by cyber-terrorists who are outraged by America's support of Israel. According to RAND, 50 Israeli corporate and government Web sites have been attacked since the beginning of a Palestinian uprising last year, targets that include airports, seaports, banks, and the stock market. Though most have been thwarted, hackers were able to deface the country's foreign and defense ministry sites. Pro-Israeli groups have also been busy attacking Palestinian, Arab, and extremist sites in seven countries, including Iran, Lebanon, and the United States. Experts say that Israel's experience with countering cyber-attacks can shield the United States from similar threats .
- "Congress Covets Copyright Cops"
Wired News (07/28/01); McCullagh, Declan
The Senate appropriations committee has approved a bill that will more than double the money allocated to hiring FBI cyber crime agents and Justice Department attorneys devoted to stamping out digital piracy and illegal hacking. Currently, the government spends $4 million to employ 75 agents and attorneys devoted to policing the Internet, but plans to boost that amount to $10 million--enough to fill out 155 positions in cyber crime units. The Senate bill also sets aside $4 million for computer equipment specifically to enable agents to do their job. The FBI recently arrested a Russian programmer for criminal violation of the Digital Millennium Copyright Act (DMCA), sparking protest from the programming community. While organizations such as the Electronic Frontier Foundation are more vocal than ever regarding perceived injustice of the DMCA crackdown, officials from the Business Software Alliance, which includes Adobe, Microsoft, and Novell, have lauded the government's efforts. The appropriations bill still has to pass a floor vote in the Senate before going on to the House.
For information regarding ACM's work in the area of intellectual property, visit http://www.acm.org/usacm/IP.
- "Don't Write Off Internet Commerce"
SiliconValley.com (07/28/01); Gillmor, Dan
Even though a significant number of online retailers have failed, much less realized a coup over traditional brick-and-mortar stores, the Internet still remains a powerful force in retailing. For one, businesses should not neglect the importance of promoting their products online. Consumers now expect to be able to research any product online, whether or not they buy it via the Internet. By aligning with e-tailing pure-plays, some traditional sellers have been able to greatly enhance their business, such as through Toys R Us' deal with Amazon.com. Internet retailing also puts more emphasis on providing good end-to-end customer service, and actually increases the opportunities in that area, as with Amazon's personalization features that also send recommendations for products that may interest the consumer.
- "'Giga' PC Arriving in 2010, Says Intel"
Newsbytes (07/26/01); Orani, Prudencia R.
Intel forecasts that "giga" PCs with processors capable of 30 GHz of clock speed should hit the market by 2010. The buses, connectivity, and storage of these machines will also be in the gigahertz range. The economic slowdown did not prevent Intel from fulfilling the projected targets in the first half of 2001, says Intel's R.J. Maclang. Intel's Paulo C. Lopez also announced that the Pentium 4 architecture, the foundation of Intel's 32-bit computing platform, should continue for five to six more years. He added that the Pentium 4 should support SDRAM rather than RDRAM by the fourth quarter, and that 2.4 GHz Pentium 4 processors should become available to the mainstream computer market by the third quarter of 2002. Lopez said that Intel will allocate $4.2 billion for research and development and $7.5 billion for capital investments this year.
- "So, Technology Pros, What Comes After the Fall?"
New York Times (07/29/01) P. 3-1; Dobrzynski, Judith H.
During a roundtable discussion led by the New York Times, Liberate Technologies CEO Mitchell E. Kertzman said information technology companies view the slowdown in Silicon Valley as just a down business cycle, but Intel CEO Craig R. Barrett said things may be worse, adding that the next "killer app" has yet to emerge. For Novell and Google Chairman Eric E. Schmidt, Napster, which attracted 50 million users in six months, is the next big thing, and Packet Design CEO and serial entrepreneur Judith L. Estrin added that the problems associated with the file-sharing service underscore the larger issue that dotcoms have poor business models and cannot make money. When the discussion shifted to protecting intellectual property from 40 million kids who know how to swap data freely, Barrett suggested that the values and attitudes of kids will change as they get older and they will understand that society must be able to protect content-based businesses. Although new copyright laws may be needed, Schmidt said the bigger problem is to get companies to agree on using a common economic model, whether based on subscriptions, advertising, or a plan that compensates everybody; Estrin added that technology will be needed to enforce the emerging model. A lack of interest in hard sciences among American youth was a common policy concern of the tech experts, but Estrin added that the IT industry has to be careful in asking the government to handle its problems. The roundtable participants did not blame the industry's woes on venture capitalists because they believe venture money will always be available if companies have a good idea. However, Kertzman and Barrett acknowledged that Wall Street analysts played a role in building up tech stocks. Barrett ended the discussion by saying that the Internet is much bigger than the United States and that there will be more Internet users overseas in the next few years.
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- "Bioinformatics Grows Legs"
Electronic Business (07/01) Vol. 27, No. 7, P. 76; Thackray, John
Bioinformatics, the combination of supercomputing power and biological research, is expanding rapidly, with an annual growth rate estimated between 25 percent and 50 percent. The impact on research has already been tremendous: for example, with bioinformatics, private-sector company Celera Genomics was able to map the human genome only two years after it was founded. Although the mapping of genes gave bioinformatics its initial spur last decade, it will likely have a role in several key scientific endeavors in the coming years, from testing which proteins influence which medical conditions to modeling weather to testing new defense systems. What unites each of these endeavors is the vast scale of data that scientists must process in order to test their hypotheses--as the director of Sun Microsystems' life-science initiative notes, "In this community, data is going from terabytes [a trillion] to pedabytes [a quadrillion] sooner than in any other industry." For example, there are 20 times as many proteins than genes in the human makeup, forcing the firms that cater to bioinformatics users to push supercomputing into new levels of performance. To meet this challenge, IBM is building Big Gene, which will process data 5,000 more quickly than does a basic PC; firms such as Compaq, which worked with Celera, Sun, and many small startups are jockeying for position in a market that could be worth $2 billion this year, based on data from Strategic Directions International. However, the field of bioinformatics does face obstacles: without a common reference point, scientists will be unable to understand the massive amount of data provided by bioinformatics. In addition, with consolidation rampant in the pharmaceutical industry, and the cost of bioinformatics systems quite high, vendors may have difficulty finding many customers for their products.
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- "Poison Valley"
Salon.com (07/30/01); Fisher, Jim
Employees who work in the assembly plants of high-tech firms in Silicon Valley may be exposing themselves to severe health risks from pollutants involved in the semiconductor assembly processes. The Bureau of Labor Statistics concludes that semiconductor industry workers sustain three to four times as much work-loss injuries and illnesses from exposure to toxic elements than those in the overall manufacturing sector. A battery of lawsuits filed against IBM allege that the company knowingly concealed the existence and extent of such health risks from workers. By denying knowledge of the presence of such dangers, high-tech companies dodge legal liability. Experts warn that the levels of toxic chemicals utilized by high-tech industrial manufacturers is incredibly difficult to measure, and technological progress only adds more components to the mix and compounds the problem. IBM's Cottle Road Disk Drive plant is the starting point for one of the biggest centers of poisoned groundwater in the country, but a even bigger health hazard, experts contend, is its clean rooms; the protective clothing workers wear in clean rooms does not prevent them from coming into contact with cancer-causing agents, while the ventilation system recirculates the saturated air rather than purifies it. Yet the Semiconductor Industry Association still regularly issues statements that semiconductor manufacturing is one of the cleanest industries around, even in the face of increasing incidence of cancer and pregnancy complications among workers. Companies continuously argue that there is not enough scientific research to conclusively link such health problems to the chemicals employed in the manufacture of semiconductors.