Small businesses have grown less concerned over Y2K in recent months, and up to 1.5 million small firms plan to do nothing about the computer problem, according to the results of a Gallup survey conducted in October. The survey, funded by the National Federation of Independent Business, reveals that most of the small firms that intended to repair systems for Y2K in April have not done so. Among the respondents in the October survey, 48 percent said they had made Y2K repairs, 4 percent planned to make repairs, 18 percent said they had no at-risk equipment, and 26 percent planned to do nothing. The federation is surprised by the results of the survey, but doubts that small business attitudes towards Y2K will change between now and the end of the year. Still, the group says the economy will not be significantly affected because firms that have not prepared tend to be the smallest companies.

The FTC today is expected to hear arguments from consumer and Internet groups urging the commission to force software companies to patch a widespread hole in email systems that permits third parties to monitor users' Internet habits. The email breach exists in all email programs that have the capability of displaying Web pages, says computer scientist Richard Smith. Companies can use the breach to place cookies on users' emails, Smith adds. Among the groups petitioning the FTC today will be Junkbusters.com, the Electronic Privacy Information Center, the Center for Media Education, Privacy International, the Consumer Project on Technology, the Consumer Federation of America, and the Electronic Frontier Foundation. Officials from Microsoft and Netscape say they are already looking into the allegations.

Barnesandnoble.com has been ordered by U.S. District Judge Marsha J. Pechman to halt the use of its Express Lane one-click shopping system, a potentially crippling blow, considering that the online holiday shopping season is in full swing. Barnesandnoble.com said it will shut down the system, but also announced that it will meet the demands of the all-important holiday shopping season by launching a new service within coming days. Details about the new service, Express Checkout, were not released. The judge's ruling stems from a lawsuit filed by Amazon.com in October, charging that barnesandnoble.com's Express Lane system infringed on a patent for Amazon.com's one-click system. Barnesandnoble.com plans to appeal the ruling.

Over the next three years 27.3 million people are expected to use DSL to access the Internet compared to just 700,000 last year, according to a report by International Data. Local phone companies who have endured criticism for their investment in DSL lines believe the increase of DSL users is good news. DSL providers and high-speed dial-up companies are competing to be the Internet connection of choice for the growing Internet population. The DSL foreign market will be a good source of revenues as Western European DSL users are expected to increase 34 percent by 2003. DSL prices have dropped in 1999 but are expected to increase; total DSL revenue will reach $2.3 billion in the U.S. by 2003, according to the report. Both business and home Internet users are beginning to upgrade their dial-up or ISDN connections to DSL; the report predicts that around 9.3 million DSL users will be residential users by the end of 2003. [http://news.cnet.com/news/0-1004-200-1476226.html?tag=st.ne.1002.]

Matsushita Electric Industrial, the Japanese manufacturer of Panasonic products, recently agreed to delay the release of its DVD Audio system by at least six months due to concerns about the ease of which the technology can be pirated. In October, a group of Norwegian hackers displayed the encryption keys to DVD video technology on the Internet. Although the difficulty in pirating DVD video disks and selling them would be great, executives at Matsushita say that pirating music from a DVD audio disk and then selling it cheaply over the Internet would be much more feasible due to the fact that there is much less data required. Other consumer electronics companies applauded Matushita's decision, saying that it is in the best interests of the industry to delay the release of DVD Audio until a new encryption system can be implemented.

Executives in the telecommunications and the Internet industries addressed the topic of a business model for the mobile Internet during the ISP Forum in Amsterdam on Wednesday. The issue is of importance when one considers that cellular phone users are believed to be key to the future of the Internet. By next year most new phones will provide Internet access. Moreover, analysts believe that as many as half of Internet browsers could come from some kind of a mobile terminal within two years. The main questions involve who will pay and how, but there were no easy answers from industry experts. David Worlock, of EPS Limited, said mobile Internet "should be started on a different business model, on a different site, and in a different relationship with the consumer." Advertising was seen by some officials as a potential alternative to replacing tariffs for the mobile versions. However, Alison Mordue, of Turner Broadcasting Systems Europe Limited, had questions about advertising, as well as about charging against simplified information systems. Meanwhile, Yahoo Europe's Bjorn Modee added that pay per minute is unlikely. Oyj Radiolinja and Sonera charge startup fees and a rate per minute. However, one of the differences between the two cellular service providers in Finland is that Sonera requires an additional charge for the type of services used, while Radiolinja does not.
[http://www.totaltele.com/view.asp?ArticleID=24882&pub=tt&categoryid=626]
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Concord Technologies next week will announce its EReceive unified messaging service, which allows users to receive fax and voice messages on their PCs. The service allows users to forward voice and fax messages, and can alert users of incoming emails over mobile phones, handhelds, or pagers. Concord's service works through a user's existing email account, making it more appealing than many other systems that require separate email accounts. Many other vendors such as Lucent, Nortel, and Siemens offer unified messaging systems, and ISPs and ASPs are considering a move into the market as well. However, analysts say the benefits of unified messaging might not justify the cost, especially of an in-house system. In most companies, only a few workers need unified messaging, so outsourcing the service might be more cost effective than developing an in-house system, says Forrester Research analyst Amanda McCarthy.
[http://www.internetwk.com/story/INW19991202S0012]

A new report from Cyber Dialogue finds that Internet retailers may be forced to expand their marketing efforts to attract new Internet users, renew efforts to retain existing customers, and increase their revenues due to the sluggish growth of the U.S. Internet-using population. The growth rate of adult Internet users declined from 58 percent during the first half of 1998 to 13 percent during the first half of this year, the report says. The report predicts that roughly half of all U.S. adults will use the Internet by 2003. Adults with low or moderate levels of income are not making the jump to cyberspace in large enough numbers, a major cause for the slowdown, the report finds. Widespread availability of broadband services is the key to luring these non-participants, says Cyber Dialogue analyst Tom Miller. The report also shows that roughly a third of those surveyed say they do not need the Internet. Further, 27 million adults gave up using the Internet this year, according to the report.

Researchers at IBM's Almaden Research Laboratory have devised a way to exploit quantum states to create software applications that can be used only once. Physicist Richard Feynman predicted quantum computing's emergence decades ago--actual products are still decades away--and IBM's Almaden researchers have developed the largest quantum-computing systems to date. Quantum teleportation, only recently discovered, allows quantum changes to occur without the transmission of any quantum information. This exploits quantum mechanics, in which atomic nuclei can exist at two stable energy levels simultaneously--just as if a computer bit existed as both a 0 and a 1 at the same time. The act of using quantum software would change the quantum state of such software, barring repeated usage. With this, the quantum computer can test multiple possibilities at once, cutting database search times in half during laboratory tests. Isaac Chuang, IBM Almaden researcher, says researching quantum computing possibilities uncovers "a regime of physics we have never encountered before."

Lucent Technologies said it would buy $500 million of computer servers from Sun Microsystems in an effort to further merge telecommunications and computer-networking equipment. Lucent will use its wireless network technology, called Flexent, in Sun's low-end Netra servers. The two companies have agreed to jointly develop the new equipment, and will also work together on connecting servers directly to optical communications networks. The alliance may boost Lucent's position in the corporate data networking market.

Sun yesterday delayed an announcement of its Java 2 platform for Linux. The company had licensed some Java Media tools to a developer team called the Blackdown Java-Linux Porting Team earlier this year. The team this week unveiled a second release candidate of its Linux Java 2 port, saying the final version will not be available until more compatibility tests are run. Currently, a Java 2 Software Development Kit documentation bundle is posted on Sun's Java Web site, Blackdown says. Inprise, which had been scheduled to take part in the postponed announcement, is also working on Java technologies for Linux. In September, Inprise said it would create commercial rapid application development tools for Linux. Inprise released a preview of its JBuilder's Just-In-Time compiler for Linux, which improves the performance of Java 2 applications on Linux.
[http://www.crn.com/search/display.asp?ArticleID=11777]

The Justice Department yesterday announced that it has hired investment banking firm Greenhill & Company as an adviser on the financial implications of potential remedies in the Microsoft antitrust suit. Greenhill will advise on "a full range of potential remedies...including conduct and structural relief," the department says. The department will rely on Greenhill during the mediation effort now in progress and in its remedy proposal, if the final ruling in the case is against Microsoft. The Justice Department says the move does not signal that it has decided on which solution to pursue. However, solutions that might require the department to seek financial advice include forcing Microsoft to open its Windows source code and splitting the company. Microsoft has criticized the government in the past for failing to grasp the technological and financial implications of its proposed remedies.
[http://www.nytimes.com]

The Department of Defense is increasingly worried about cyber attacks on its computer systems. The Pentagon reports 80 to 100 unauthorized entries into its computers every day, 10 of which usually require some sort of investigation. The main point of vulnerability is the network dealing with non-classified information, called NIPRNET. The Defense Information Systems Agency has reported 18,500 break-ins to the system in 1999, as compared to only 5,844 in 1998. Information on this system include where troops are situated, spare parts orders, transportation logistics, and some credit-card and phone numbers of military personnel. The Pentagon is now attempting to improve its intrusion detection software, train personnel in becoming more adept at computer security, and review who should have access to its non-classified networks. Y2K poses problems for the Defense Department, which is Y2K compliant but worries about increased hacker attacks on New Year's Day. The department is also concerned about the possibility of programmers who have planted bugs in the Pentagon systems under the guise of preparing the computers for Y2K readiness. The Pentagon says that it wants to become less reactive and more proactive when it comes to cyber attacks.

CIO and International Data recently surveyed IT executives to determine which vendors and integrators make reliable business partners. Respondents ranked partners on several points, such as the partner's effort to understand the client's business issues and willingness to share the risks and responsibilities of implementations. The survey also evaluated whether a partner surpasses the obligations of a contract, ensures that products offer real business advantages, works with other vendors and business partners to help the project, and ensures customer satisfaction after a sale is made. Respondents evaluated partners on these points in four categories, including ERP, data warehousing, groupware/messaging, and systems management. In general, the survey found that integrators scored higher than product vendors, although 70 percent of respondents say they contract directly with their vendor. Integrators are more responsive than vendors, particularly large vendors, respondents say. "The vendor comes in with the assumption that the software works," says Allegheny Teledyne IT director Donald McMahon. "The integrator works under the assumption that he will make it work." Another survey finding is that while vendors with a significant share of the market rate highly in terms of strategic importance, these same vendors are not necessarily considered good partners. Many small companies scored well in terms of partnering capabilities, but size is not always an indicator of partnering qualities. Another trend the study shows is that vendors and integrators both scored best in understanding customers' businesses and delivering business benefits. The worst scores fell into the categories of sharing risk and working with users and other vendors to offer complete solutions.

Y2K litigation is picking up as the end of the year approaches, with large companies suing insurance firms that refuse to pay out on claims for Y2K-related expenses. Xerox, GTE, and Unisys have all sued their insurers, and experts say Y2K could result in over $35 billion in potential claims. Companies are seeking compensation from insurers under policy provisions covering costs for equipment repairs that could minimize business losses. In response, insurance companies say Y2K repairs are not covered by standard property and casualty coverage because the public was widely aware of Y2K. Insurers have become a common target for companies seeking compensation, since recent Y2K legislation shields equipment and software makers from lawsuits to some extent. The rulings in these early cases will largely determine the extent of Y2K litigation, experts say. "If these cases are summarily dismissed, similar suits are pretty much down the chute," says Giga Information Group analyst Kazim Isfahani. "If they go through, every Fortune 100 company and others will be lining up to cash in on the precedent." If the claims are upheld in court, Y2K litigation could continue for up to 10 years, Isfahani says. In addition to companies suing insurers, Y2K suits are likely to include patent-infringement cases involving Y2K tools.

Solitons, waves that move at a constant shape and speed, can be used for fiber-optic-based data transmissions, but have yet to progress beyond the laboratory. France-based Algety Telecom is seeking to establish soliton-based technology as a key network component. Algety plans to become the first company to introduce a commercial product that blends solitons and wave division multiplexing technology. Algety achieved the highest speed ever for a soliton transmission when, in February, it reached speeds of 1 Tbps over 1,000 km. Terabit speeds may only span about 400 km without the assistance of solitons. Solitons will allow long-distance fiber-optic network operators to reach higher speeds without the need to install intermediate repeater stations, which allow information to travel greater distances. Solitons will also become popular over shorter distances as cables become more congested with data, says Algety's Jerome Faul.

SAS Institute early next year plans to release data-collection and data-mining software called Web Hound and Web Mining. The products aim to fill the need for business intelligence tools in e-commerce. Web Hound will feature the SAS MDDB Server multidimensional database, tools for gathering clickstream data, and reporting tools for ordering the data and creating data marts. Meanwhile, Web Mining will be based on the SAS Enterprise Miner product, but will also include SAS' data warehouse administration software. Web Mining will include analytical templates for Web site data, and will allow users to merge data from sites with customer and sales information from other sources, says SAS' John McIntyre. Also building business intelligence tools for e-commerce are Broadbase, IBM, net.Genesis, and Oracle. In addition, Microsoft this month announced plans to create e-commerce business intelligence tools through its Business Internet Analytics initiative.