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Volume 1, Issue 5: Friday, December 10, 1999
- "VA Linux Makes a Record Debut"
Los Angeles Times (12/10/99) P. C1; Dunn, Ashley
Shares of VA Linux Systems yesterday skyrocketed nearly 700
percent on the first day they were available, from an IPO price
of $30 a share to a closing price of $239.25. Some analysts say
the record-setting increase indicates a big future for
Linux-related products and a threat to Microsoft, but others
simply saw it as irrational behavior. International Data analyst
Dan Kusnetzky says, "This is buying into a dream, and when people
wake up, the dream might not be there." Still, other
Linux-related offerings have also done very well this year and
analysts see the open-source operating system as a serious
competitor to Microsoft. They say the investor frenzy is helping
to legitimize the OS. VA Linux, Red Hat, and Corel, among
others, are offering versions of Linux that come with support and
other services in an effort to attract corporate buyers that
otherwise might be wary of an open-source based product. Linux
is increasingly being used for Web servers and also is expected
to be used with a new wave of digital appliances. However,
leading computer firms are also embracing Linux and the potential
market is still not that big, according to Kusnetzky. VA Linux,
at yesterday's closing price, now has a market capitalization of
$9.5 billion, bigger than many large, well-established companies.
For its last fiscal year, which ended July 31, the nearly
five-year-old company reported total revenues of $17.7 million
and a $14.5 million loss.
- "Microsoft Launches E-Services for Office Users"
InfoWorld.com (12/09/99); Johnston, Margret
Microsoft on Wednesday began providing expanded free services on
its Microsoft Office Update Web site
(www.officeupdate.microsoft.com) to users of its Office suite.
Microsoft's expanded Office services include the ability to store
files for others to modify, display PowerPoint files, find
information, and maintain an inbox for voice, fax, and email
messages. The site already had offered clip art, templates,
reference tools, pictures, and sounds. The site also features
Web publishing services in partnership with several vendors for
use with Word files and PowerPoint slides. Another partnership
allows Office users to print postage stamps on their own printer.
Next year Microsoft says it will provide free language
translation services. Microsoft says 2 million users now visit
the site each month.
- "Harvard Seeks Rights to Own Name in Cyber Suit"
Boston Globe (12/08/99) P. B1; Murphy, Shelley
Harvard University is suing under the just-signed cyber-piracy
law to gain Internet rights to Web site addresses, now held by
Michael Rhys and his company Web-Pro, that relate to the
university. Rhys had bought 65 domain names involving Harvard
and Radcliffe and offered to sell them back to Harvard for about
$325,000 before trying to sell them in an online auction.
Harvard says it is suing to defend its trademark and is using the
new cybersquatting bill to back up its claim. The bill allows
trademark holders to seek damages from anyone that registers a
name that infringes on a trademark and then trying to sell it
back to the trademark holder. Harvard says it does not want
money from Rhys, but simply wants him to stop. The new
cybersquatting bill, signed November 29, was heavily backed by
businesses and celebrities, which often have had to pay large
sums to gain the rights to Web site addresses that bear their
- "New Law Touches Off Suits Over Names in Cyberspace"
New York Times (12/09/99) P. C2; Clausing, Jeri
The fallout from the new anti-cybersquatting law that recently
went into effect has been considerable, as trademark holders
throughout the states are filing lawsuits to claim domain names.
Critics say the law places small companies and individuals at a
significant disadvantage against large corporations in the
scramble to claim legitimate ownership of Internet addresses.
The Internet Corporation for Assigned Names and Numbers (ICANN)
will be responsible for assigning trademark-related domain name
disputes to international arbitration centers; however, ICANN's
authority extends only to those domains assigned by the newer
registrar firms and those distributed by Network Solutions after
Jan. 1. The White House originally opposed the new
anti-cybersquatting law due to concern that it would interfere
with ICANN's dispute-resolution responsibilities. Among the
trademark holders who recently filed lawsuits to protect their
property are New Zealand's America's Cup team, Harvard
University, and the National Football League.
- "Dell Extends Linux System's Use"
Associated Press (12/07/99); Mabin, Connie
Dell Computer yesterday announced that it will install Linux on
its high-end PowerEdge servers, with Linux distributor Red Hat
providing customer service and technical support. Although
systems based on Linux now account for only a small percentage of
Dell's revenue, the open source OS is rapidly gaining popularity,
says Dell's Bruce Anderson, noting that Dell is now selling twice
as many Linux systems as it did in August. PowerEdge customers
range from small companies to large ISPs, and the server is
priced from $5,000 to over $12,000. Beyond the recent PowerEdge
announcement, Dell supports Red Hat Linux on some desktop PCs and
workstations. In addition to the support agreement with Dell,
Red Hat has made similar deals with Gateway, IBM,
Hewlett-Packard, and Compaq.
- "Data Bus: Technology Spending"
Investor's Business Daily (12/10/99) P. A6
Technology spending by the majority of the U.S.'s fastest-growing
companies is expected to remain the same, according to a survey
from PricewaterhouseCoopers. Total hardware spending will remain
steady in the next 12 months for 71 percent of the
fastest-growing service companies, Pricewaterhouse reports, with
17 percent planning increases and 12 percent planning to spend
less. Total software spending by service companies is also
expected to remain the same by 72 percent of respondents, with 16
percent planning increases and 12 percent expecting decreases in
- "Does E-Commerce Have Anything to Offer Small Business?"
E-Commerce Times (12/07/99); Spiegel, Rob
E-commerce for small to midsize businesses has not developed as
much as it has for large companies, but more efforts are now
being made to draw smaller firms online. Small business Web
sites for the most part are just static pages that contain
information about products and services. The capital, time, and
effort required to move into actual e-commerce are too great for
most small businesses. One Web firm called Affinia now offers to
build small company sites that are stocked with products from a
group of affiliates. Still, Affinia does not relieve small
business owners from tasks such as promotion and advertising, and
does not solve problems of capital, time, and effort. Small
companies are not motivated to participate in online procurement
because they do not see immediate savings as do larger firms.
However, small companies do use information obtained from the
Internet. While small business owners are used to getting online
information for free, some companies believe they would be
willing to pay for special reports or writing services. For
example, Inc.com sells proprietary reports to small firms while
Digital Work offers small companies writing assistance and press
- "Portals May Come Unstuck in 2000, Says IBM Guru"
Network World Today Online (12/08/99); Soon, Alan
A newfound maturity in the e-business market could cause poorly
planned sites to fall behind, said IBM vice president of Internet
technology John Patrick at a recent press briefing in Hong Kong.
Patrick predicted that Internet startups with unstable business
models and companies which are reluctant to fully adopt the
Internet will have the most trouble staying afloat in 2000.
Patrick also foresees a shakeup in the portal sector; he said
that vertically integrated portals will see increased success,
while all-purpose portals will be less popular. Ultimately, says
Patrick, community portals will have the most market support.
"Hanging out has emerged in my mind as an important business,"
says Patrick. This community focus will also become important
because consumer expectations will determine which businesses
survive, according to Patrick. "Expectations of people will
drive the next wave of the Internet," said Patrick. "People, not
companies." Last, Patrick predicted that many consumers will
abandon their PCs in favor of handheld devices such as cell
phones, pagers, and personal digital assistants. While more than
95 percent of all Web pages are currently viewed using a PC,
Patrick expects that rate to drop to less than 50 percent in two
- "Lessons Learned From ERP: E-Commerce Will Feel Frictionless"
PlanetIT (12/01/99); Lipsin, Bill
The issues many companies faced in implementing ERP strategies 10
years ago can help businesses better understand today's task of
moving into e-commerce, writes Bill Lipsin. ERP implementations
often neglected in-between steps as companies raced into complex
projects without proper structure or discipline. Before jumping
into e-commerce, companies today should set priorities and
examine technical issues, says Lipsin. Initially, companies
should evaluate whether the benefits of e-commerce justify the
costs, and rank the importance of business issues associated with
e-commerce. In business-to-business applications, companies
should stress necessary functionality, such as product
availability and real-time visibility into order status, rather
than flashy features. In executing an e-commerce strategy,
companies should form a cross-functional team that taps the
expertise of each relevant area. Companies should rely on
technology from best-of-class vendors wherever possible,
developing functionality only when necessary, Lipsin says.
Furthermore, companies should choose products based on open
standards to ensure compatibility with current and future
technologies. Finally, companies should set small, attainable
goals and adhere strictly to deadlines. Although the pressure
for companies to move to e-commerce is unrivaled, e-commerce
implementations cannot match the complexity of ERP projects and
should feel "frictionless" by comparison, Lipsin says.
- "Inside IBM: Internet Business Machines"
Business Week (12/13/99) No. 3659, P. EB20; Sager, Ira
The dot-com companies may get all the glory in the Internet
marketplace, but IBM has quietly become the leader in helping
businesses set up shop online, executives refocus their
companies' corporate strategies, and much more. About one-fourth
of IBM's $80 billion in annual revenue now comes from
e-business--almost 50 percent more than rival Sun. And of IBM's
e-business revenue, three-fourths comes from the sale of Internet
technology, software, and services, rather than the mainframes to
which IBM's reputation remains tied. IBM CEO Lou Gerstner's
says, "Now, I am not suggesting that you view us as an Internet
company, but I think it is worth noting that IBM is already
generating more [e-business] revenue and certainly more profit
than all of the top Internet companies combined. Critics pointed
to IBM CEO Lou Gerstner's lack of computer industry experience
when he came to the company in 1993, yet Gerstner has tenaciously
sought to push IBM e-business influence in all areas, from
products to practices to marketing. Among the results: online
sales should reach past $12 billion this year, up almost 400
percent compared with last year. And by handling more of its
customer service online, IBM expects to save $750 million. More
internal training using the Internet should give IBM and
additional $120 million in savings. In a critical early move by
Gerstner, IBM in 1994 devoted 25 percent of its research and
development budget to Internet-related technology, with the
intention of making all IBM products "Internet-friendly." As
part of the new strategy, Lotus Notes was integrated with Web
technology, and IBM based software development on the Java
programming language. The respected IBM executive Irving
Wladawsky-Berger was put in charge of the company's new Internet
Division that year, and Gerstner sat down with top executives and
decided where in IBM's product line were gaps that IBM needed to
focus new development on.
- "ASPs Rethink Approach to Billing Users"
InfoWorld (12/06/99) Vol. 21, No. 49, P. 1; Briody, Dan
ASPs are examining different billing models, with some favoring a
usage-based approach and others advocating flat rates. In
response to the usage-based push, software makers are beginning
to offer products that help ASPs determine a customer's monthly
usage. In the past, ASPs had difficulty charging on a usage
basis because they could not monitor and meter network traffic.
This week Narus plans to launch version 1.5 of its Narus Billing
Mediation software, which will provide ASPs with usage data,
fraud detection, and quality-of-service diagnostics. Another
software firm called Erogo offers ASPFlex, which lets ASPs bill
for specific applications. Rather than monitoring usage, ASPFlex
takes usage information from a specific application and channels
it into a billing program. Narus and other companies believe
ASPs, like major phone companies, will use their pricing plans to
distinguish themselves from rivals in the future. However, other
companies such as USinternetworking feel that customers want to
know how much they will be paying each month.
USinternetworking's Dave Collier points to the ISP industry,
which began charging on a usage basis and switched over to flat
fees because of customer demand.
- "Not a Global Village After All?"
InternetWeek (12/06/99) No. 792, P. 13; Wilson, Tim
People in different countries use the Web and make online
purchases in sometimes vastly different ways, according to a
nonscientific International Data (IDC) survey on e-commerce.
IDC's John Gantz says, "Some of the results we had will challenge
the conventional wisdom about e-commerce in certain countries."
For example, although many people do not view developing
countries as potential markets for online commerce, up to 33
percent of respondents in India, China, and Chile bought things
on the Net in the last three months. Western Europeans have the
speediest access, with over 40 percent having links of at least
64 Kbps, while high-speed connections are available to roughly 22
percent of Asia-Pacific region people. In the U.S., the
percentage of people with links over 56 Kbps is 17 percent, but
the U.S. led the world in buying online; three-quarters of U.S.
respondents said they bought something on the Net in the past
three months. In Japan, over 25 percent of people responding
said they had at least three devices with which they could access
the Net. People responding to the survey also came from all
levels of education and computer savvy, so online merchants will
have to focus on ease of use, says IDC's Alan Farias. The survey
was based on voluntary responses from 29,000 Web surfers in over
- "Do 'Digital Certificates' Hold the Key to Colleges' Online Activities?"
Chronicle of Higher Education (12/10/99) Vol. 46, No. 16, P. A47;
Several universities have begun issuing "digital certificates" to
ascertain the identity of students and college personnel who are
conducting online endeavors on campus. These certificates are
small, coded files with embedded information about a particular
person or institution. The certificates come with two encryption
keys, one public and one private. University administrators say
these certificates will gain more importance as colleges
increasingly make online campus activities self-regulated, such
as allowing students to register for classes online. Analysts
say research librarians may currently be most in need of digital
certificates, in order to use databases and electronic journals
not in stock in their campus collections. However, many
universities are not currently offering digital certificates to
students because many of the electronic databases that the
universities subscribe to do not have their servers programmed to
accept certificates. This has led MIT and nonprofit consortium
Corporation for Research and Educational Networking (CREN) to
create a service that validates the digital certificates of
colleges and research institutions that meet certain guidelines.
This allows universities to bypass the complicated technical and
business agreements that would have to be arranged for a
university to ensure that its certificates would be recognized by
other colleges and electronic publishers.
- "AirTouch: Rolling Out Slowly"
Wireless Week (11/29/99) Vol. 5, No. 48, P. 24; Smith, Brad
Net Access, AirTouch Cellular's first wireless Internet service,
allows users to connect laptops to the Internet or a corporate
intranet. Boeing's Ron Mannhalter says Net Access is easy to use
and deploy, and works well even from deep inside Boeing's
concrete-and-steel plant near Seattle. Net Access is currently
being used exclusively in QUALCOMM 860 Thin Phones, but AirTouch
is planning to bring out other Net Access-equipped handsets in
the future. The company predicts that the service will be
nationwide by early 2000 via roaming agreements.
- "Behind the Scenes"
PC Magazine (12/14/99) Vol. 18, No. 22, P. 12; Gunnerson, Gary
A wealth of new technologies aim to make e-commerce more
convenient. Among these innovations is the digital wallet, which
is designed to automatically fill out the online forms required
upon purchase by each online site. Jupiter Communications
reports that 27 percent of consumers abandon e-commerce
transactions because they do not want to take the time to
complete the online forms. Digital wallets ease the e-commerce
process by securely storing consumer information such as billing
address, mailing address, and credit card information. Most
digital wallets have adopted standard methods of completing
online forms, either by cataloging forms for specific sites or by
supporting tags that use Electronic Commerce Markup Language
- "Standard Irons Wrinkles out of IP Fax"
Network World (12/06/99) Vol. 16, No. 49, P. 51; Sieloff, Jeff
IP fax transmissions can offer substantial cost savings for
businesses by skirting long distance charges. But
interoperability issues still exist that can result in higher
phone bills for users, writes Brooktrout Technology's Jeff
Sieloff. The International Telecommunications Union has…
- "A Big Bet on the Holidays"
Newsweek (12/13/99) Vol. 134, No. 24, P. 70; Stone, Brad
Internet retailers have bombarded television viewers with a slew
of advertisements in the hope of making huge holiday sales. The
potential for big money already is evident: over Thanksgiving
weekend Amazon.com sold two and a half times as much as in the
same period last year, Yahoo! sold five times more, and AOL sold
three times more. Dataquest projects total holiday e-commerce
sales to reach $12.2 billion, three times higher than last year.
Smaller e-commerce companies find themselves at a crossroads.
Some are opting to join the advertising bonanza and boost their
sales at a hot time of year. Others are choosing to wait until
the noise dies down and some of their competitors have fallen
away before launching promotional campaigns. FamilyWonder.com
founder Jonathan Kaplan says he does not want to spend all of his
company's money making ads that will blur into a sea of rivals'
spots. Meanwhile, Send.com CEO Mike Lannon sees the market as
too volatile to wait and is in the midst of a massive effort to
attract customers. Lucy.com CEO Sue Levin says only e-commerce
sites with solid brand names will be able to succeed over this
year's holidays, so she plans to wait until early next year to
begin pushing her site.
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