Investor unrest over the proposed Hewlett-Packard merger with Compaq may be a sign that the U.S. PC is near the end of its long era of dominance. PC sales have dropped this year for the first time ever, while labor costs have risen, worldwide competition has intensified, and prices have fallen. Analysts say PC manufacturers must innovate to reinvigorate the industry. Stanford University business professor Joel Hyatt says U.S. PC manufacturers should look for the next new wave of innovation, which could come from biotechnology or nanotechnology. The commoditization of memory chips led Intel to make a similar move in the 1980s, as it decided to abandon its cash cow for microprocessors in the face of government-subsidized Japanese competition. Hewlett-Packard and Compaq, if the merger prevails, plan to form a services business like IBM's that would salvage their profits, but analysts say the problem is too large for services to help. The number of PCs sold worldwide is expected to fall from 132 million in 2000 to 130 million this year, according to International Data. The chief driver of this dip is a drop in U.S. sales. Some analysts forecast that network management servers and business technology services are likely to be the wave of the future. UC Berkeley economic historian Bradford DeLong compares the current state of the PC industry to the TV industry in the 1970s, or the steel industry in the 1960s.
http://www.latimes.com/news/printedition/la-000097770dec09132046.story

Starting salaries for IT workers are predicted to grow by just 0.1 percent in 2002, compared to 8.4 percent in 2001, according to a survey by RHI Consulting. The lackluster growth in salaries is due to a dampened economy and dot-com troubles, says RHI executive director Katherine Spencer Lee. Actually, the current environment indicates a return to normal levels, she says. Similarly, a survey by Matrix Resources finds that salaries for tech workers plummeted 2.1 percent in the third quarter in such areas as Atlanta, Dallas, New Jersey, and North Carolina. In the second quarter, IT salaries in these areas increased by only 0.85 percent, Matrix found. Despite the overall slow down, salaries for database managers are expected to increase 4.8 percent to $114,000, RHI predicts; for help-desk specialists, salaries could increase 4.9 percent to $57,000. However, information-systems managers and desktop support analysts are likely to experience a drop in starting salaries, according to the study.
http://dailynews.yahoo.com/h/cn/20011207/tc/it_salaries_stabilizing_1.html

Silicon Valley businesses will hold a summit in San Jose next week to discuss defense and security technology. The goal of the Technology and Homeland Security Summit and Expo is to display state-of-the-art defense solutions designed to revive the flagging economy as well as demonstrate the industry's response to the war on terrorism. The organizers also say the summit will highlight employment opportunities that could alleviate Silicon Valley's climbing unemployment rate. Over 50 organizations will participate, while executives from Symantec, Siebel Systems, Travelocity, and other firms will form a speaker panel. The panelists will discuss cybersecurity, human resources, biosecurity, and financial services, among other topics. Products to be showcased at the expo include DNA analysis devices and antivirus and software-encryption programs. "It's Silicon Valley's way to show the entire world our leadership position with tools and technology to ensure security," says San Jose Silicon Valley Workforce Investment Network director Blake Konczal.
http://www.siliconvalley.com/docs/news/depth/summit120801.htm

The worldwide damage caused by computer worms and viruses this year cost companies less than last year, according to findings by Computer Economics. Online havoc has cost $12.3 billion in 2001 so far, compared to $17.1 billion in 2000, the research firm concludes. Virus activity has been much lower this year compared to prior periods, says Computer Economics' Michael Erbschloe. Major attacks this year were attributed to the Code Red viruses, which caused $2.62 billion in damage; the more recent Nimda worm caused $590 million in damage. It is too early to measure the cost of the Goner or Pentagone worm, while Erbschloe believes last month's Badtrans worm only inflicted minor damage. He thinks that increased cyber-terrorism vigilance from the military and other agencies may be responsible for the slowdown of virus outbreaks. Another factor Erbschloe credits is the development of automated virus cleanup procedures since last year's Love Bug attack. Such measures have reduced lost productivity for companies affected by system crashes and damaged information, he says.
http://www.investors.com/editorial/tech.asp?v=12/10

A disagreement between the European Parliament and European Union governments about the regulation of unsolicited spam email threatens to scuttle plans to enhance EU data protection laws. EU governments are calling for a prohibition on the emails, while the Parliament merely wants to limit them to users who have agreed to receive them in advance. The spam regulation measure is part of a larger bill that would require telcos and ISPs to retain user data and emails for police investigations. Both the Parliament and the EU governments are in accord that the bill would allow the suspension of consumer protection rules in the interest of national security. The proposal has not found much support among businesses, who worry that its passage could result in cost hikes.
http://news.excite.com/news/ap/011206/16/eu-data-protection

Many graduates who had set their sights on getting lucrative high-tech jobs--particularly in Silicon Valley--have had their hopes dashed or postponed because of the dot-com bust and economic recession. Even a degree from a prestigious institution does not guarantee a job. The National Association of Colleges and Employers estimates that corporations across the country will hire 19.7 percent fewer 2001-2002 college graduates than the 2000-2001 graduates they hired last year. Some companies are still looking for employees, but not entry-level applicants. Faced with these setbacks, some graduates are deciding to go back to school. Others are playing a waiting game, or accepting employment outside their chosen fields. "There are jobs out there but they may not be as glamorous as they were a year and a half ago at big-name companies," says June Lim of the San Jose State University Career Center. "I think adjusting their expectations will be the hardest part of the reality check for students."
http://www.siliconvalley.com/docs/news/depth/grad121001.htm

The Segway Human Transporter, better known as Ginger, does not read a user's mind but it does feature five gyroscopes that measure how far ahead the rider has leaned; this measurement is sent to microprocessors that in turn tell the transporter's wheels how fast to move in order to keep it upright. Silicon rings within the gyroscopes are electrically charged to vibrate at 15 KHz, while the platform containing the gyroscopes starts to rotate when the vehicle moves. The leaning rider steps up the platform's rotation, and the gyroscopes are subjected to second set of vibrations that travel in a different direction. The new vibrations are driven by Coriolis force, which is measured by electrodes within the ring. The speed of rotation is determined by the Coriolis measurement combined with the transporter's linear speed. The vehicle has a top speed of 12.5 miles per hour.
http://www.wired.com/news/technology/0,1282,48920,00.html

Copiers of copyrighted digital material could be undone by a new watermarking technology from Amino Communications that inserts information about a user's smart card into the copied file. If that data were unavailable, then the watermark would contain hardware information. This would allow pirates to be traced by an electronic trail emanating from their own files. The technology would take the form of a microchip and software combination to be used with digital video recorders and pay-per-view television systems with digital recording capabilities. However, Fabien Petitcolas of Microsoft's Cambridge research labs notes that watermarking has yet to prove itself resistant to attacks. Meanwhile, Phillips researcher Jean-Paul Linnartz says watermarking methods such as Amino's could be seen as a circumvention of privacy.
http://www.newscientist.com/news/news.jsp?id=ns99991655

IT workers with cyberdefense skills are in short supply, according to a study from online testing firm Brainbench. Demand has never been greater for people with skills in network security, disaster recovery, and WAN technology, the firm says. Shortages exist because such skills have not been in high demand and financial rewards have been lacking, says Brainbench CEO Mike Russiello. Gartner analyst Barbara Gomolski agrees. "Previously, security was an area of underinvestment," she says. "Now, it's on the radar screen of top executives." Meanwhile, Gartner has been tapped by companies to develop job descriptions for newly devised security positions, Gomolski says. The San Francisco area has the most cybersecurity experts, says Brainbench, followed by Washington-Baltimore, Los Angeles, New York-New Jersey-Connecticut; and Chicago.
http://www.informationweek.com/story/IWK20011129S0018

The Department of Defense says the response to its request for new security tools that could help fight terrorism has been overwhelming. The Pentagon usually receives anywhere from 10 to a few hundred proposals when it puts out Broad Agency Announcements, but this time the agency has attracted one-page proposals from more than 5,000 large companies, small businesses, and college researchers--and the deadline does not pass until Dec. 23. "This is the most we've ever had on this type of announcement," says Pentagon spokesman Glenn Flood, who adds that this is the first time the Defense Department has made a Broad Agency Announcement for terrorism. The Pentagon issues such requests when it wants to roll out something very quickly. A number of companies from Colorado believe they can help in the war on terrorism, including Denver-based WorldNet Technologies, which offers an advanced scanner that can search internal body cavities and simultaneously scan luggage, and also look for specific weapons and determine their location. Durango-based Loronix and other companies are expected to offer biometric systems that use voices, facial characteristics, fingerprints, and retina and iris patterns to identify travelers. Another area of interest for tech companies appears to be placing surveillance systems aboard planes so that pilots will be able to monitor cabins.
http://www.newsfactor.com/perl/story/15137.html

Computer chip researchers at this year's International Electron Devices Meeting hosted about half the number of guests first expected, but featured groundbreaking new developments nonetheless. Participants said the chip industry may be entering a "Golden Age," where limitations in current chip technologies give way to new materials and design approaches that until recently seemed improbable. The meeting highlighted technologies that will be commercially applicable in two to three years. One such project was focused on integrating brain cells with silicon microchip components, which could one day lead to brain-controlled computer functions. Researchers also began to reset their limits of Moore's Law, setting the horizon for continued silicon-based chip progress until at least 2010. Importantly, an Intel presentation featured a recent IBM technology that would cut both power use and leakage in microchips.
http://www.nytimes.com/2001/12/10/technology/10NECO.html
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Microsoft Research (MSR) senior VP Rick Rashid says better voice technology, plentiful data storage, realistic computer graphics, and more intelligent software are key aspects to the revolutionary technology on the five- to 10-year horizon. Other projects in development at MSR include Mindnet, a natural language database culled from dictionaries; and Ask MSR, a site that automatically answers questions. Microsoft already has software that models human behavior, such as an email organizing program that categorizes messages according to past preferences. The software is currently used inside Microsoft. Many of MSR's developments have been implemented in Microsoft products, especially in programming and development tools. Examples of MSR research include better bug-testing tools for software, optimization technology that allowed Office 95 and Windows 95 to run on only 8 MB of RAM, and the ClearType technology used in PocketPC and Tablet PC devices.
http://www.pcworld.com/news/article/0,aid,74206,00.asp

The largest prime number yet to be documented has been discovered by Michael Cameron, a participant in the Great Internet Mersenne Prime Search (Gimps). The project, founded in 1996 by George Woltman, aims to uncover new Mersenne primes through distributed computing. With the help of Entropia's PrimeNet system, participants such as Cameron can employ their computers to search for the numbers. Cameron's number was found by an 800 MHz AMD T-Bird PC, running part time for 45 days. There are 4,053,946 digits in the number, which is expressed as 2(13,466,917)-1. Some 130,000 volunteer home users, students, schools, businesses, and institutions of higher learning currently participate in Gimps, according to Woltman. Invulnerable codes and message encryptions could be developed thanks to research into Mersenne primes.
http://news.bbc.co.uk/hi/english/sci/tech/newsid_1693000/1693364.stm

When U.S. officials talk about overhauling the intelligence agencies, technology is often a topic that leads to heated debates regarding the issue. While advocates of technology maintain it is needed to gather, analyze, and share data, opponents argue that the reliance on technology is discouraging agencies from placing agents on the ground in dangerous parts of the world. The terrorist attacks on the United States have made the issue of restructuring the intelligence agencies a more timely concern. Some observers believe the United States may have been able to recruit spies in Afghanistan or detect the Sept. 11 plot if the agencies had used their networks of hidden spies. Technology will even hurt the reform effort, some experts say. Former CIA field agent Reuel Marc Gerecht says, "New and better technology will not crack the grip of 'inside' officers--the fake diplomats--over the culture and modus operandi of the [CIA]." Indeed, lawmakers such as Sens. Bob Graham (D-Fla.) and Richard C. Shelby (R-Ala.) stress that the bureaucratic culture of inflexibility in the intelligence community is a more critical factor in a restructuring than technology. A team of senior government officials and another panel of private-sector experts will present in the coming months their recommendations for revamping the intelligence agencies.
http://www.govexec.com/dailyfed/1201/120301nj1.htm

Many countries are turning to the free, open-source Linux operating systems instead of programs designed by Microsoft and other computer corporations, mostly for reasons of national security. Because Linux is open source, programmers can fix vulnerabilities themselves and publish the results. About 30 percent of global Web sites are run with Microsoft software, and 62 percent of them have been hacked. China is developing its own version, called Red Flag Linux, "to pry the computer industry from the grip of operating systems giants like Microsoft," as an official paper stated last spring. Germany's chief of economy and technology, Margareta Wolf, said the reason behind her country's gradual switchover is "protection from economic espionage." Many countries are also afraid that Microsoft operating systems have built-in "back doors," which allow U.S. intelligence agencies to access their computer networks.
http://www.govtech.net/news/news.phtml?docid=2001.12.03-3030000000003951

Tech workers burned by the dot-com implosion are turning to Washington-area defense contractors and firms embarking on government-related homeland security projects. "The government is the only [place] left that has any money," says Mario Gonzales, a former Booz Allen & Hamilton developer who now works for BAE Systems. BAE is doing programming and consulting services for the Navy to supplant legacy systems with Web-ready database applications. Fifteen new BAE employees are dot-com veterans who have had to adjust to salary cuts, a formal atmosphere, fewer amenities, security clearances, and low-profile work. The transition has been fairly smooth. The group likes the work hours, preferring a 9-to-5 schedule rather than the all-nighters and overtime typical of startups.
http://www.washingtonpost.com/wp-dyn/articles/A64946-2001Dec5.html

The top high-tech companies have not wavered in their philanthropic efforts to schools even as sales are down, stock values are struggling, and employees are being let go. Leading education officials, such as Ted Sanders, president of the Denver-based Education Commission of the States, says he has seen no indication that companies such as Intel, Cisco Systems, IBM, and Microsoft would do so. For example, Intel says it remains committed to spending $35 million next year on education initiatives around the world, while IBM says its $25 million expansion of its 7-year-old Reinventing Education project is still on, and Microsoft say it will continue its giving efforts, including the $100 million cash and software program with the nation's Boys & Girls Clubs and some elementary schools. However, Karen W. Smith, executive director of Tech Corps, a nonprofit that accepts contributions from high-tech companies, admits that tech companies were "being a little more discriminatory, wanting to make sure that, where they put their dollars, the maximum impact is being reached." Some observers say K-12 giving is a long-term investment, and as a result, they do not see high-tech companies eliminating their programs. Others say tech companies have spent years making inroads into the education market, and abandoning K-12 giving would send the wrong message. Moreover, there are not too many bright spots for the industry other than the education market today. School districts appear ready to replace old PCs and to extend broadband communications links to classrooms.
http://www.edweek.org/ew/newstory.cfm?slug=14corptech.h21

The economic downturn has been a sobering event for foreign workers who came to the United States on H-1B visas in search of lucrative jobs. Just a few years ago, a tech worker shortage prompted Congress to dramatically raise the cap on H-1Bs. Today, many visa holders are finding themselves out of work, and have a 10-day limit to find another company willing to assume responsibility on the visa. Those that are employed are making less money than the national average, according to a report from the Immigration and Naturalization Service. Stories of immigrants being mistreated by the corporations that hire them run rampant on the Internet. In the meantime, companies such as the Economic Development Corporation of Stuttgart are launching advertising campaigns designed to coax foreign workers to move back to their native countries.
http://www.infoworld.com/articles/pe/xml/01/12/03/011203pehome.xml

Companies are using collaborative virtual design environments (CVDEs) to facilitate collaborative virtual design and product development. CVDEs are virtual reality applications that feature 3D imagery and are designed to enable users to view and review systems, assemblies, and components. Both the public and private sector are making use of first-generation commercial CVDEs such as helmet mounted displays (HMDs) and stereographic monitor systems, and second-generation products such as the Cave Automatic Virtual Environment (CAVE) and the Powerwall screen system. The systems offer cost savings and faster time-to-market product cycles. If design flaws can be detected and fixed sooner, the less money it will cost the company; CVDEs enable collaborative team members to make solid design decisions early in the process. For example, Boeing has cut design rework for its 777 aircraft by 60 percent to 70 percent via Computer-Aided Three-dimensional Interactive Application (CATIA). Other CVDE systems and initiatives of note include PaulingWorld, a shared virtual environment that allows users to study molecules; NASA's redesign of its Space Shuttle Orbital Maneuvering System (OMS) and Reaction Control System (RCS) through real-time, 3D graphics; and an effort to create digital human beings as a real-time communications tool for people separated by great distances. Before CVDEs can proliferate throughout public and private industries, however, their price must come down and organizational, operational, behavioral, and research issues need to be addressed.
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