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Volume 3, Issue 151:  Wednesday, January 10, 2001

  • "Web Cements English as Global Commerce Language"
    Investor's Business Daily (01/10/01) P. A6; York, Thomas

    English is the language of choice on the Internet. According to a 1999 survey of 600 million Web pages by ExciteAtHome, 72 percent of the pages were in English. The next most prevalent language was Japanese at 7 percent. Among domain hosts, the English language has an 80 percent share, and domain names in English increased 450 percent between 1998 and 2000. Many Internet experts say English may as well be the official language of the cyberworld, as most of the programming languages, such as DOS and Linux, on which the backbone of the Internet continues to be built are written in English. Moreover, nearly all non-English-language Web sites link to English-language sites, while few English-language sites link to non-English-language sites. However, some in the Internet industry believe English's dominance is not as clear-cut as it may seem. The number of domain names in Japanese, German, and French also increased over the past two years, and some observers say Internet use in China and India, as well as other countries, should explode soon, bringing more languages online. Geoffrey Nunberg of Xerox's Palo Alto Research Center argues that the Internet will actually encourage the spread of languages other than English because of its borderless nature. "The Internet of the future will be a much more polyglot place than most people assume," he says.

  • "Traditional Companies Starting to Cut Dot-Com Staff"
    USA Today (01/09/01) P. 1B; Krantz, Matt

    Traditional firms that built up their online units before the dot-com shakeout are now laying off dot-com workers. Like Internet startups, traditional companies originally believed their online units would expand much faster than they actually did, says George Stalk of Boston Consulting Group. Yesterday alone hundreds of dot-com workers lost their jobs at Ameritrade, Cambridge Technology Partners, and J.P. Morgan Chase's Morgan Online. Cambridge Technology Partners cut 280 workers, or 7 percent of its staff, mostly from its e-business unit. Meanwhile, Morgan Online laid off 150 workers, roughly half of its workforce, cutting primarily from the marketing and sales divisions. The New York Times recently announced plans to lay off 69 workers from its online unit, or 17 percent of the unit's staff. Still, traditional companies that rush to slash dot-com workers "may regret shutting down online operations prematurely," warns Eric Almquist of Mercer Management Consulting.

  • "Intel Head Warns on Power Crisis"
    Financial Times (01/09/01) P. 4; Parkes, Christopher

    Intel CEO Craig Barrett told Bloomberg news that the worsening energy crisis in California is prompting him to expand his business elsewhere. Barrett said states such as New Mexico, Arizona, and Oregon, all of which have reliable power supplies, or even foreign countries such as Israel or Ireland are better sites for expansion than California. He said many businesses will not have the patience to wait out the state's power crisis, which is threatening to bankrupt several utilities. California Gov. Gray Davis was expected to outline a remedy in his state-of-the-state address Monday night, and energy officials are due at the White House today to discuss the issue. Although the state recently allowed utilities to raise consumer rates to stave off bankruptcy, analysts say the move is not enough, while consumers are continuing to express outrage at the cost of power.

  • "First Dot-Com Union Election Pulled"
    Associated Press (01/09/01)

    Workers at etown.com will not vote on unionization this Friday, Jan. 12, as originally planned. Workers cancelled the planned vote after members of the Northern California Media Workers union filed a complaint with the National Labor Relations Board (NLRB). The complaint charges etown's management with conducting a scare campaign to persuade workers not to unionize, including a threat that unionization would force the company to shut down. This is not the first time representatives from the Northern California Media Workers have cited etown's management for union-busting activities. Last year the union accused etown of firing employees who had met to discuss unionization. Etown officials said the layoffs were not related to unionization. Etown President Les Brown has also denied threatening to close the company if his employees unionized. However, Northern California Media Workers Local 39521 representative Erin Poh contends, "There is no way that we felt [etown's employees] could have a fair election at this time." Under NLRB policy, no union election can be held for the next six months while it investigates the union's charges.

  • "Safe Harbor Is a Lonely Harbor"
    Wired News (01/05/01); McCullagh, Declan

    An agreement by the U.S. government and the European Union to establish a "safe harbor" that protects customer privacy has borne little fruit. Since the agreement was reached last summer, only about a dozen firms have signed up for Commerce Department certification. Safe harbor participants would fulfill the European directive limiting the transfer of information to non-EU nations that fail to meet certain data requirements. On Jan. 4, Deputy Assistant Commerce Secretary Michelle O'Neill announced a series of educational seminars on the development of adequate privacy policies at a Washington press conference. The purpose of the seminars is to "generate participation by getting the word out to businesses, particularly small businesses across the country," O'Neill explained. The safe harbor deal was supported by U.S. insurance, financial, tourism, and airline interests that wanted to use personal data gathered about European consumers. In the certification process, a company is asked to identify itself, its corporate officer in charge of compliance, its privacy policy URL, the type of data the company collects, and its willingness to "cooperate with the EU Data Protection Authority." Stockholm University's Jacob Palme criticizes the European directive as open to misinterpretation by entities such as the Swedish Data Inspection Board, which limits its search engines and censors animal rights activists and anti-bank advocates. "I think that [the safe harbor deal] was more political than substantial and that the only real solution--which will happen sooner or later--is to have adequate privacy legislation [in the United States]," says Privacy Times editor Evan Hendricks. Despite the low number of certification applicants, Commerce Secretary Norman Mineta is confident that the situation will improve, although further work is needed in the areas of intellectual property, free speech, taxation, and privacy.

  • "Battle Lines Form Between PC Firms and Device Makers"
    Investor's Business Daily (01/09/01) P. A6; Seitz, Patrick

    PC makers are moving into the consumer electronics market, bringing with them a PC-centric vision that clashes with the views of consumer electronics firms. This division was evident at the Consumer Electronics Show last weekend, where Microsoft showed off its new X-Box video game console and Intel displayed an MP3 Internet music player and other devices. PC executives argue that the PC will be the heart of the networked home, linking various devices and storing all the data. Microsoft Chairman Bill Gates says the PC will be "the center of control," while Intel CEO Craig Barrett says the PC's importance will grow as it is connected to more devices such as MP3 music players and digital cameras. By contrast, consumer electronics makers contend that a "post-PC era" is emerging, as devices that connect to the Internet no longer need to link to a PC. "Over time, Internet access will migrate from being a largely PC-oriented browsing activity to being an always-on medium like television or radio," says Philips Consumer Electronics Mainstream CEO Guy Demuynck. The unit of Philips Electronics this year expects to release devices, such as a stereo system, that connect to the Internet without relying on a PC. Similarly, Panasonic Consumer Electronics plans to create Internet-enabled devices ranging from TVs to refrigerators that function without a PC.

  • "Apple's New Items Are Made to Back 'Digital Hub' View"
    Wall Street Journal (01/10/01) P. B6; Tam, Pui-Wing

    Apple Computer CEO Steve Jobs yesterday at the MacWorld trade show unveiled several new products aimed at boosting the company's flagging sales. Joining the recent debate about the future of the PC, Jobs said he does not believe new devices will render the PC obsolete. In fact, Jobs says Apple computers "can be the digital hub of our emerging digital lifestyle." Jobs demonstrated Apple's new iDVD software, which works with DVD players and camcorders to allow users to make their own DVDs. In addition, Jobs unveiled iTunes, a software jukebox that is compatible with MP3 players. Apple is also introducing a new line of Power Mac G4 desktops, which Jobs also showed off at MacWorld. The new machines address two weaknesses in Apple's systems by offering more power and including CD-RW drives. The four new Power Mac G4 models range from 466 MHz to 733 MHz. Also at the show, Jobs displayed a new laptop line called Titanium PowerBook G4, which is far slimmer than currently available models. Some analysts were encouraged by Apple's new offerings, but others said the new products might not be enough to offset the economic downturn.

  • "ICANN Hunts for New Board Members"
    Newsbytes (01/05/01); McGuire, David

    This week, ICANN's Address Supporting Organization (ASO) put out a request for candidates to assume ICANN director Ken Fockler's position once his term expires in October 2001. The ASO's announcement highlights the current dispute over the makeup of ICANN's board. "I don't believe that [the board] is legitimate until it consists at least half of people who came from the Internet community," says ICANN director Karl Auerbach. It is infuriating that ICANN only elected five "at-large" board members instead of the nine that was expected, says Auerbach. A study will be done over the next couple of years that will help ICANN determine whether or not the other four at-large board members are even necessary. While the study is taking place, four board members appointed by ICANN's founders will serve on the board, and have been doing so since 1998. These "interim" board members will stay on ICANN's board until the study is concluded. Therefore, the interim board members will remain for two years, while the newly elected "at-large" board members' terms will end in 2002, notes Auerbach. The other half of ICANN's board consists of members elected by ICANN's supporting organizations.
    For information regarding ACM's Internet governance work related to ICANN, visit http://www.acm.org/serving/IG.html

  • "Hemming in the World Wide Web"
    New York Times Online (01/07/01); Glater, Jonathan D.

    Yahoo! said last week that it will crack down on hateful and violent material on its sites, but the company is not backing down from France and a French court order that says the company must prevent French citizens from gaining access to pro-Nazi sites through its portal as well as Nazi material at its auction site. Instead, Yahoo! is waiting for an American court to decide whether France can enforce its law in the United States. The dispute between Yahoo! and France highlights the larger issue of whether the Web will ever become a borderless medium in which citizens the world over have open access to the technology. Until this dispute, many observers said the authoritative philosophies of many governments around the world would most likely keep the Internet from gaining a worldwide reach. However, an undercurrent of the dispute is France's pride in its own culture. Some countries will have a problem with the Internet if it is overwhelmingly English. Besides political and cultural reasons, countries might object to exposing their citizens to the Internet for religious reasons. Advocates of an open Internet appear to be fighting a losing battle. "This is actually a very medieval conception of jurisdiction: your rights are carried with you as you travel from one place to another," says Stanford University law professor Lawrence Lessig.
    (Access to this site is free; however, first-time visitors will need to register.)

  • "Despite Layoffs, Tech Worker Shortage Persists"
    Newsbytes (01/09/01); Krebs, Brian

    A new study from the American Electronics Association (AeA) finds that the shortage of skilled IT labor has not been greatly affected by layoffs in the dot-com industry. Dot-com layoffs over the past eight months have caused 35,299 high-tech workers to lose their jobs, according to Industry Standard, but an AeA spokesperson says this is rather insignificant compared to the total shortage in the entire high-tech sector, which employs some 5 million people. The AeA study finds that high-tech firms continue to struggle to offer competitive packages to potential employees. However, the study says many firms rely on incentives such as tuition incentives that have proven to be largely ineffective. Firms that use incentives such as variable-pay programs, milestone rewards, and stay bonuses to attract employees are more successful, according to the study, and the incentive with the most success is a program to reward employees who refer new hires. The continued labor shortage has prompted some in Congress to seek even further expansion of the H-1B visa program for foreign high-tech workers. The new Tech Smart Pilot Program, proposed by Reps. David Wu (D-Ore.) and Chris Cox (R-Calif.), would increase the number of H-1B visas allowed each year by 65,000. The new visas would be given outside the 195,000 visa cap set by Congress last year and would require the companies taking on H-1B workers to donate $4,500 to a college or university in the U.S. One area of the high-tech sector that may see relief from the labor shortage sooner than others is the traditional, non-Internet sector. Challenger, Gray & Christmas says many laid-off dot-com workers are spurning the Internet industry for more established and stable firms as they seek new work.

  • "Brazil May Slash Computer Taxes"
    Wired News (01/09/01); Rebelo, Paulo

    The Brazilian Congress last week approved legislation that will give tech companies a 95 percent discount on the industrialized products tax, in a move aimed at making technology more affordable for consumers. In addition to enabling tech companies to sell products at lower prices, the bill is expected to help Brazilian students by requiring tech companies to contribute 5 percent of their profits to public universities. The bill would help Brazil modernize more quickly as more people gained access to technology, supporters say. The bill's supporters say Brazil must address the affordability of technology, with minimum wage workers earning the equivalent of $90 a month while a Compaq computer costs around $1,500. However, the Amazonas state is raising some objections to the bill. Traditionally, the Amazonas capital Manaus was the only region allowed to offer tax breaks and lower production costs, and Manaus officials believe the new bill will draw business away from the area. For the bill to become a law, President Fernando Henrique Cardoso must approve the measure by Jan. 20.

  • "China Planning Own Internet"
    Associated Press (01/06/01)

    The Chinese government has tapped several unnamed companies to construct a second-generation network that functions much like the Internet. The network will be used by China's government and industry, according to a report by the Chinese government's Xinhua News Agency. "In the new century, the Chinese people will build our very own information superhighway," Xinhua said. "The current one by itself has too many faults and is incapable of satisfying the needs of the Chinese government and companies as they enter the digital age." Xinhua did not indicate when construction on the network would begin or end. The network's underlying technology will consist partially of new technology that will be used for an international upgrade of the Internet. It is unclear whether foreigners will be given access to the new network. The number of Internet users in China rose from 9 million to 20 million during the past year, according to government statistics.

  • "Seasoned Bosses Hold Upper Hand in Job Market"
    Wall Street Journal (01/09/01) P. B1; Murray, Matt

    Older and more experienced executives are gaining an edge over their younger counterparts in the job market as the dot-com shakeout continues, marking a sharp reversal from the situation at the beginning of last year, observers say. "The profile of the most desirable CEO looks dramatically different today than it did nine months ago," says Scott R. Gordon of headhunter Spencer Stuart. The charm of young prodigies with no management experience has worn off, and companies are now looking for executives with strong employment histories that include brick-and-mortar companies. Older executives who left for dot-coms in the past two years are the most sought-after in the current job market because they demonstrated "a high degree of tolerance for risk, and an ability to step up to the plate," says Paul Daversa of executive recruiting firm Resource Systems Group. By contrast, many young executives have not proven that they can manage a profitable business, Daversa says. One prominent example of this recent trend occurred this week when VerticalNet CEO Joseph Galli Jr. stepped down to accept the CEO post at Newell Rubbermaid. Formerly a Black & Decker executive, 42-year-old Galli became a high-profile example of a brick-and-mortar executive who left for a dot-com after he went to work for Amazon.com and eventually migrated to VerticalNet.

  • "Electronic Books Move Past Rough-Draft Stage"
    Baltimore Sun (01/08/01) P. 1C; Stroh, Michael

    Momentum is starting to build in the e-books category. Microsoft has developed new software that will bring e-books to millions of desktops, and authors such as Stephen King and Dean Koontz have introduced their readers to the technology by writing tales for the digital format. And now consumer electronics giant Thompson Multimedia, maker of RCA-brand televisions, has introduced two new e-books in the REB 1100 and 1200, bringing the next-generation technology to the masses for the first time in stores such as Best Buy, Circuit City, and OfficeMax. For the most part, consumers could only find the first generation technology on the Internet or at more obscure specialty retailers. With the REB 1100, the successor to the Rocket eBook, consumers get a $299 device that is about the size of a book and can store about 8,000 pages of text. Meanwhile, the $699 REB 1200, which descends from the Softbook Reader, offers a color screen. Although Thompson has reached a content agreement with Gemstar that will deliver popular magazines and newspapers to REB users, the content for the e-books is often abbreviated and it is still difficult to read notes taken with the stylus. RCA addressed the issue of intellectual property by not allowing REB users to share digital copies of books. Industry-wide, sales of e-books are expected to grow over the next few years. About 10 percent of all books will be sold electronically by 2004, according to Accenture, formerly Andersen Consulting.
    Click Here to View Full Article

  • "Privacy Tops Internet Hot Spots in 2001"
    Toronto Globe and Mail Online (01/04/01); Geist, Michael

    The groundswell for children's privacy laws in the United States will grow stronger this year, writes University of Ottawa Law School Professor Michael Geist. Geist also predicts that the debate over financial privacy will heat up as new laws go into effect. Wireless technology is the next big privacy battle to watch for, and the continued lack of consumer confidence in online shopping will lead to greater scrutiny of the legal framework surrounding e-commerce. Meanwhile, Canada will continue to remain active in introducing Internet legislation. Canadian provinces have been cranking out e-commerce legislation, but this year should also see the introduction of more programs for consumer protection and alternative dispute resolutions. Evidence of countries imposing their own laws on the Internet continues to mount, the French court decision concerning Yahoo! and Nazi memorabilia being the most recent example. The U.S. children's privacy law and the transatlantic data privacy agreement are other examples. High-speed Internet access and intellectual property rights will also be high-profile tech issues during 2001.
    Click Here to View Full Article

  • "Ready for the Returns?"
    InformationWeek (01/08/01) No. 819, P. 22; Rosen, Cheryl

    Online enterprises are struggling to devise a solution to product returns. About 5.6 percent, or $569 million worth, of items bought online will be returned this year, consuming 30 percent to 35 percent of potential profits, according to Boston Consulting Group and Goldman Sachs. About 58 percent of online retailers allow customers to return unwanted goods through brick-and-mortar store locations, the most convenient option available to consumers. But there is more to returns management than opening the doors of store locations and companies have different philosophies on how to best manage returned goods. While 51 percent of online retailers invested in new fulfillment systems last year, only 29 percent improved their return systems and processes, according to Jupiter Media Metrix. "Online retailers know how important the returns process is, but they still haven't put the resources into it that they have in other places," says BlueLight operations director Alex McNealy. Nordstrom, which allows online orders to returned in its stores, has separate IT systems for its store, catalog, and Internet operations, allowing the company to accurately calculate sales tax and attribute revenue losses to the correct divisions. Borders eliminates expensive steps in the process by allowing just about any book or CD in saleable condition to be resold from the store in which it was returned. Other companies, including Egghead.com and MuseumCompany.com, prefer to eliminate the return process almost entirely from their operations by outsourcing the process to fulfillment specialists such as ReturnBuy.com and SubmitOrder.com.

  • "The Big Picture"
    Economist (01/06/01) Vol. 358, No. 8203, P. 75

    Physicists at the Helsinki Institute of Physics developed software that uses a self-organizing map to reveal patterns of electronic communication within an organization. The software, which will be commercially available from a new company called Single Source, was developed as a tool for the CERN particle physics laboratory close to Geneva. Researchers at CERN, led by the software's creator Ari-Pekka Hameri, used the software to record and analyze all the data shared by those working on the lab's major engineering projects. To sort through the information, the software uses a self-organizing map to create a diagram of communications between individuals. The map continuously decreases the distance among workers whose communications are similar. Therefore, dark clusters on the map show people who are working closely together, while isolated dark spots suggest a breach in communication. Self-organizing maps can also reveal the ways in which individuals use a particular file, showing differences between disciplined workers and more creative types, for example. This could help managers form teams that include people with complementary strengths and weaknesses. Although Single Source software could prove useful for some organizations, some workers might object to being monitored.

  • "Grey Zone"
    InfoSystems Executive (12/00) Vol. 5, No. 12, P. 12; McMurchie, Lyne

    The high-tech industry appears to be discriminating against older workers even as the IT labor shortage grows more severe, according to many observers. Although little proof exists that companies discriminate on the basis of age, anecdotal evidence abounds. Many older IT workers believe that potential employers overlook them because they do not fit the stereotype of the young techie. Some employers believe older workers cannot learn new skills, take too much sick leave, and do not cooperate with younger bosses, says Tony Palmer of One Voice, an advocacy group for older Canadians. Compared with younger workers, those over the age of 45 are called for fewer interviews and are not as well-received at the interviews they go on, according to a recent One Voice study. In addition, older workers say they are the first to be laid off when companies restructure, says Keith Norton of the Ontario Human Rights Commission. On the job, managers often deprive older workers of the chance to upgrade their skills by not showing them how to use new technology, Norton says. Although many observers say the tech industry is no more guilty of age discrimination than any other industry, the tech industry is probably the least able to turn away skilled workers. The existing labor shortage will only intensify in the future, especially when Baby Boomers start retiring, leaving no one to take their place, observers say. Companies need to treat older workers fairly now in terms of hiring, training, and promotions so that some of these valuable workers will continue working after they reach retirement age, says Ken Orr of the Cutter Consortium, an IT consulting firm. Workers in the 45 and above range still have many working years left and are more likely to stay at one company than their younger counterparts, says Orr. Companies should focus on allowing older workers to share their knowledge with younger workers, Orr says.

  • "Security, E-Government Demand Attention"
    Federal Times (01/01/01) Vol. 36, No. 48, P. 8; Robb, Karen

    Although government IT officials performed admirably in dealing with the Y2K problem, observers say they have not acted on the momentum generated by that effort and implemented as many e-government solutions over the last year as they could have. The most notable e-government accomplishments in 2000 included the government-wide portal FirstGov, which links together more than 100 million government Web pages, as well as specific portals for students, senior citizens, and other groups of citizens. Within government, several agencies implemented e-government solutions, such as the Department of Transportation's new Web-based travel reservation system. However, observers say most agencies and departments will require significant increases in IT funding to do the major work necessary to make e-government a reality. Much of this work involves replacing the legacy paper-based systems within these agencies with an IT infrastructure. However, some observers believe the imminent change in administrations will affect that investment. Olga Grkavac of the Information Technology Association of America says, "The current administration came into power during the pre-Internet era. [The Bush administration] will know what the Internet can do and will demand change." Changes in congressional committee chairpersons could bring several IT proponents into positions of power, Grkavac speculates. Meanwhile, officials at many federal agencies say bureaucracy continues to impede e-government's growth. A major problem is that many agency CIOs, created by the Clinger-Cohen Act of 1996, still do not have control over how the many IT officials spend funds or implement policy. Many both inside and outside the government continue to urge the appointment of a federal, cabinet-level CIO to remedy the problem. However, the federal government could be facing a more serious problem as many of its IT employees will be reaching retirement age in the coming years. Efforts are now underway both to raise IT salaries and to attract young workers through various scholarship programs.

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