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Volume 3, Issue 200:  Wednesday, May 9, 2001

  • "IT Dollars Going Toward Home Improvement, Survey Finds"
    TheStandard.com (05/08/01); Dalton, Greg

    Corporate IT spending this year is focused on internal needs rather than external projects, according to a survey of 300 corporate IT departments from Adams, Harkness & Hill Technology Services Research. Of highest priority for corporate IT departments, according to the survey, are internal projects such as data warehousing, the growth of internal data networks, messaging, and software integration. Customer relationship management (CRM) was the only external IT area to crack the survey's top five IT priorities. Survey analyst Alex Arnold says the results indicate that corporate IT departments are very concerned with showing a return on investment from their projects, which is prompting them to undertake short-term internal projects rather than complicated external IT projects such as integrating supply chain management software. The survey is another piece of bad news for the embattled tech industry, which may grow only 6.6 percent this year, according to first-quarter figures from the Department of Commerce. Adams, Harkness, & Hill says this downturn will have a serious impact on tech consulting firms, which could see revenues drop by 25 percent this year.

  • "HP Chai Software Will Be Available as 'Open Source'"
    Investor's Business Daily (05/09/01) P. A6; Riley, Sheila

    Hewlett-Packard will soon release its Chai software to the open source community, marking a substantial investment by the company into Linux and other open source efforts. The company has spent millions developing Chai but sees a future in the open source movement. Hewlett-Packard Linux expert Bruce Perens says many companies are turning to Linux during the economic downturn as their tech budgets are asked to do more with less. Linux is not only free software but offers other cost savings, such as money saved on support because the source code is readily available and easily improved. However, some experts discount the release of the Chai software because they think that a large corporation such as Hewlett-Packard would not release software as open source if it could generate revenue for them. They say Hewlett-Packard is eager to follow other developers such as IBM and Sun Microsystems, which are further along in their Linux programs. All Linux developers, however, are unified to some extent and focused on breaking Microsoft's lockjaw grip on the corporate and home software market. Hewlett-Packard, along with IBM, Intel, and others, is part of the Open Source Developers Lab.

  • "Open-Source Vendors Respond to Microsoft 'Attack'"
    InfoWorld.com (05/04/01); Berger, Matt

    Microsoft last week warned against the dangers of open source software, saying it would stifle innovation by promoting an unsustainable business model. Open source vendors have balked in response, countering that Microsoft's stance will have to change as Linux gains more market share and the reality of open source takes shape. Already, Linux has seen great success--for example, the Apache Web server now runs 62.5 percent of Web sites, compared to 20.6 percent for Microsoft's Internet Information Server. Companies such as Red Hat and VA Linux Systems are well-established software firms that have grown up around the open source movement. Microsoft executive Craig Mundie's speech last week pointed out failings in the GNU General Public License agreement that is used with most distributions of open source software, as well as the threat it poses to software compatibility and intellectual property. Instead, Mundie promoted Microsoft's "shared source" policy, which the open source community denounces for having an essentially proprietary model.
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  • "Internet Privacy Rules Could Cost Business as Much as $36 Billion"
    Wall Street Journal (05/08/01) P. B5

    Businesses would need to spend at least $9 billion and perhaps as much as $36 billion to comply with the terms of Internet privacy legislation pending in Congress, according to a study underwritten by the Association for Competitive Technology (ACT). Economist Robert Hahn was in charge of compiling data for the study, which questioned 17 companies. Those companies, 14 of which have ties with ACT, said the costs of a personal data tracking system would range anywhere from $46,000 to $670,000. Establishing these systems would be a "nontrivial task," said Hahn, head of the Joint Center for Regulatory Studies of the American Enterprise Institute and the Brookings Institution. Hahn cautioned Congress about launching blindly into legislating Internet privacy unless there are obvious and significant benefits. ACT is a Microsoft-supported lobbying group.

  • "Telecommuting's Big Experiment"
    New York Times (05/09/01) P. C1; Glater, Jonathan D.

    U.S. Rep. Frank R. Wolf (R-Va.), a member of the House Appropriations Committee, amended legislation last year so that federal agencies would have to give at least 25 percent of eligible workers the option to telecommute. Private businesses have been much faster to catch on to telecommuting, and the number of employees working from home rose to 23.6 million last year, up from 4 million in 1990. Many federal workers do need to have a physical presence in their office--supervising criminal prisons or handling secret documents, for example--which prohibits them from doing their job at home. However, Wolf estimates that 45 percent to 60 percent of the 1.8 million federal workers in the executive branch are eligible to telecommute. Some departments, such as the General Services Administration, have already embraced telecommuting. Acting Commissioner Paul Chistolini estimates that 10 percent to 15 percent of his 7,300 employees work from home. He says much of the slowness of the federal government to adopt this practice comes from outdated management skills. He believes that a significant culture change, possibly mandated by Wolf's bill, would be necessary to get some agencies going.
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  • "What's Next for the Web? Ask the Inventor"
    IDG News Service (05/08/01); Lawson, Stephen

    Further development is needed to improve the Web, World Wide Web Consortium (W3C) director Tim Berners-Lee recently told the World Wide Web Conference, held this year in Hong Kong. Among the areas in which the Web continues to need improvement are spreading Web-related technology to the world's developing countries and remote areas, extending Web applications to portable devices, and integrating Web languages. Berners-Lee confirmed a major step toward the integration of Web programming when he announced that the W3C had given formal approval to the XML Schema, which he called "an XML language for defining XML languages." Using the XML Schema, programmers will have a standard way to describe XML-encoded content. Berners-Lee also trumpeted the Resource Description Framework, or RDF, as a way for different applications to exchange XML-encoded data. In addition, Berners-Lee discussed the need for new interfaces for computers, including voice-based interface, as well as the need for devising a way for e-commerce to provide proofs of purchase.

  • "Hacker Group Launches Anti-MPAA Web Site"
    Newsbytes (05/04/01); McGuire, David

    A hacker group named the South Bend Hacker's Club recently launched a new Web site in opposition to the Motion Picture Association of America (MPAA), coinciding with critical developments in the MPAA's suit against 2600 Magazine. The MPAA charges 2600, an online hacker publication, with violating the 1998 Digital Millennium Copyright Act by distributing the DeCSS code that unscrambles the copy-protection system embedded in DVDs. Keith Kimmel, owner of the South Bend Hacker's Club site, which offers up to 20 variations of DeCSS, says he is willing to defend his site against any legal attack on the basis that software code is protected under the First Amendment. Although the MPAA did not comment on the new site, vice president of public affairs Richard Taylor says the actions of 2600 Magazine exactly fit the type of activity the Digital Millennium Copyright Act was meant to stop.

  • "To Russia, With Cash"
    Boston Globe (05/07/01) P. C1; Kerber, Ross

    Investors such as Vested Development hope to build out the Russian software market. Until now, they have encountered several hurdles, including language barriers, a lack of high-speed data connections, and little government assistance in the form of special tax incentives to grow the software industry. Central Europe Trust, a British consulting firm, says Russia has about 4,000 full-time programmers in its software-export sector, which produced about $100 million in exports in 2000. In comparison, India has a software industry of some 300,000 trained professionals that generated $6 billion in exports last year. Although executives at Vested refuse to make the claim that the software industry in Russia is on the verge of a major expansion, they do believe that it has nowhere to go but up. The company has experienced some success in luring talented tech professionals from the former Soviet military-industrial complex, but officials acknowledges that doing Java-2 enterprise software may not be "as intellectually glamorous" as the projects to which the Russian tech workers are accustomed. As a result, Vested has seen only a third of Russian scientists who participated in its training program join the software firm. U.S. officials would like to see more former Soviet scientists enter the industry rather than offer their talents to rogue nations.
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  • "Net Allows People to Help Themselves"
    SilliconValley.com (05/05/01); Gillmor, Dan

    The Web is proving a useful tool in making available information that would otherwise be distributed only among a select group. For example, online forums for popular technology products such as digital TV recorders are places where people can learn how to upgrade the hardware themselves. Although such information is not sanctioned by the manufacturer and often nulls the warranty on the product, the Internet has made such procedures readily available to curious users. For example, EchoStar's DishPlayer system has only 200,000 U.S. customers, but it maintains an active online community where people can trade information about expanding storage capacity and other procedures. Whereas such resourceful information would be regulated to a limited number of people before the Internet's advent, it is now democratized and can be easily located through a search engine.

  • "Struggling Software Firms Turn Into Takeover Targets"
    USA Today (05/08/01) P. 1B; Swartz, Jon; Kessler, Michelle

    As the U.S. economy continues to show evidence of a downturn, the software market is beginning to see a great deal of consolidation. The first quarter of 2001 saw 380 mergers and acquisitions worth $13 billion, reports the mergers and acquisitions firm Software Equity Group. "As the Internet industry consolidates, so does the software market," says Guernsey Research analyst Chris LeTocq. Recent acquisitions include IBM's $1 billion purchase of the database of Informix, Actuate's planned acquisition of Tidestone Technologies, and an apparent bidding war between Dimension Data Holdings and Compaq for Proxicom. Analysts say the software market faces several challenges, including the fact that there are simply too many firms offering the same product, especially in the e-business sector. Also, the significant downturn in many firms' stock values makes potential customers wary to do business with them, further adding to their struggles. Firms are also hard pressed to compete with the larger, more innovative companies that are resulting from recent mergers and acquisitions. The market's troubles may only increase, now that a European Securities Network report suggests IT spending in Europe may be falling.

  • "Hackers Unleash No-Limits Internet Browser"
    E-Commerce Times (05/07/01); McDonald, Tim

    A team of hackers dubbed "Cult of the Dead Cow"--responsible for Back Orifice technology, which lets a person take control of a PC running Microsoft Windows--recently announced that it will introduce a Web browser designed to circumvent Internet filtering technology. The "no-limits" browser is to be unveiled at a July hackers conference in Las Vegas and is targeted for users in politically restrictive countries such as China and Singapore. The system works through a network called Peekabooty. Users joining the network would ask for certain files or works to be posted on the network; upon receiving the files, the browser puts them together and attaches additional secret codes to conceal the data, then sends them to the requester. For example, a person in China could request a forbidden Web site from another Peekabooty user. The system is similar to that of Napster and Gnutella in that it utilizes peer-to-peer architecture, which does not have a main server in the network--thus, each client can exchange data directly with one another. Because such a system lacks a chief server, law enforcement agencies cannot trace the system to any one person. The system would allow users in restrictive countries to get access to banned sexually graphic or political Internet sites, and the encryption added to the files would make the data undetectable to filtering mechanisms. Politically open countries such as Germany and Australia also use filtering technology to restrict access to certain Web sites.

  • "Get Ready for Your Nano Future"
    Technology Review Online (05/04/01); Leo, Alan

    A National Science and Technology Council meeting last fall dealt with the possible implications of nanotechnology, an area or research that is quickly growing in funding, if not in public awareness. In 2000, President Clinton said the government would spend $500 million on an inter-agency research project, the National Nanotechnology Initiative. Several universities have also revealed new nanotechnology efforts, including a $150 million effort to build new labs at the University of California's Los Angeles and Davis campuses. Both the new federal effort and last fall's meeting were designed to foster discussion on the implications for society of nanotechnology's development. Creating machines that operate on the molecular level could one day lead to now unthinkable advances in nearly every field of science, from medicine to agriculture to computing. However, the new field also raises serious ethical questions about its potential function in the construction of new weapons--in fact, Sun Microsystems chief scientist Bill Joy recently offered the opinion that nanotechnology could create robots that would pose a greater threat to humanity's existence than nuclear weapons do. Most of nanotechnology's proponents say this argument is short-sighted and would lead to many potential breakthroughs being lost. However, those at last year's meeting suggested nanotechnology could benefit from an industry-wide effort to consider the ethical, legal, and social ramifications of the technology, lest it become as misunderstood by society--and thus feared--as nuclear power, an industry that made little such effort to consider its public role.

  • "E-Commerce Layoffs: Storm on the Tech Frontier"
    E-Commerce Times (05/08/01); Mahoney, Michael

    Although dot-com layoffs have so far impacted only 3 percent of the 3.1 million Internet-related workers, the layoffs have had a significant impact within the tech economy. Challenger, Gray & Christmas reports that April saw a renewed surge of dot-com layoffs, showing that companies are still looking for ways to decrease spending. Challenger, Gray & Christmas CEO John Challenger says a big problem for dot-coms is their funding models, which rely mostly on venture capital. Venture capitalists, he notes, are looking for quick returns on their money and are not like institutional investors, who have large stakes in other tech businesses. Dot-coms, he says, are at a disadvantage and often look to layoffs as a quick solution to ease financial pressure. Challenger cautions against such hasty conclusions, instead advising companies to seek out alternative cost reduction measures, such as changes to information technology.

  • "Microsoft: Free-Software Licenses Are the Devil's Work!"
    Salon.com (05/03/01); Leonard, Andrew

    Microsoft executive Craig Mundie on Thursday criticized the general public license (GPL), the license behind the open source software movement, as being an obstacle to innovation as well as economic development. Mundie argued that the GPL robs commercial software vendors of the funds needed to develop new products. This lack of innovation would then cause a slowdown in the growth of the software industry, and then the economy as a whole. However, as columnist Andrew Leonard points out, many of those in the open source software movement have little concern for the economic consequences of their actions. For them, making their work available to the public is a moral matter, not to mention an opportunity to thumb their noses at Microsoft. Moreover, Leonard notes, those who choose to use open source software instead of Microsoft products are, in a sense, making what they consider to be the best economic choice--money that once would have been paid to Microsoft can now be spent on other concerns. Leonard speculates that Microsoft's real concern is not the spirit of innovation, but rather its role as the leading software vendor and how the advent and rise of the Internet may change that role. Microsoft, having achieved dominance in the desktop software market, is now turning its attention to Web-based software and services through its much hyped .Net initiative. However, the .Net strategy, which Leonard argues is nothing more than an attempt to create a layer on top of the Internet that would be controlled by Microsoft, is seriously threatened by the proliferation of open source software, especially among those companies that do business online.

  • "Chilling Out"
    Baltimore Sun (05/07/01) P. 1C; Thomson, Candus

    Certified alpine guide Chris Warner no longer has to use an open flame to bring his laptop computers back to life when he is on an expedition atop Mount Everest. Thanks to TEKsystems, minus-40 degree temperatures cannot keep Warner from using the Internet to spin tales of his amazing travels through the Himalayas. For Warner, the suburban Baltimore company selected the Sony VAIO PictureBook, the 2.2-pound laptop with integrated video camera and microphone, tweaking the equipment to include a 1.6 GB hard drive for "real industrial strength." Moreover, the hard drive has no moving parts to freeze and is not affected by shocks or vibrations. Paul Marzin, senior systems architect at TEKsystems, says everything else about Warner's laptops consists of "off-the-shelf stuff." In the past, adventure-seekers of Mount Everest have used everything from Nepalese runners to pencils and paper to record and deliver their news. An attempt by Canadian climber Byron Smith to use a TV camera and transmission equipment last year failed because of winds in excess of 100 mph. Warner's dispatches, photos, and video clips can be seen online at the Baltimore Sun's Web site, Sunspot.net.
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  • "Study Casts Light on Which Countries Are 'E-Ready'"
    InfoWorld.com (05/03/01); Johnston, Margret

    Global opportunities in IT exist in countries with forward-thinking leadership, network access, strong intellectual property laws, and ready workers, according to a recent study by McConnell International. McConnell surveyed 53 countries, grading them in five categories that set the tone for their "e-readiness." Estonia, Taiwan, and South Korea ranked highest for their skilled workforce and digitally minded politicians. Mexico, the United Arab Emirates, Lithuania, and Greece also scored well, ranking moderately across all five categories. Nations that had been lagging behind the United States and Western European countries see the current slowdown in IT as an opportunity to catch up. This openness, in turn provides a good opportunity for tech companies looking to expand their business beyond slowing and saturated markets in North America and elsewhere. Information Technology Association president Harris Miller notes the golden opportunity in international expansion by pointing out only 350 million of the world's 6 billion people currently use the Internet and that population centers like India have fast-growing IT sectors.

  • "Registries Prepare for Domain Crush"
    CNet (05/07/01); Bowman, Lisa M.

    Registries for .info, .name, and .pro announced at the International Trademark Association's annual meeting that they will protect trademark rights by offering a "sunrise period" where only trademark holders can register domain names before gTLDs hit the market. While .biz registry NeuLevel will not offer a sunrise period, it will incorporate trademark priority into its general .biz screening process, which will restrict the .biz moniker to solely commercial entities. A spokesperson for the .name registry, Global Name Registry, said that while .name will be reserved for individuals and families, trademark holders of names like "Harry Potter" or "Mickey Mouse" will also get a first shot. Almost all the new gTLDs will have certain restrictions, such as .museum being reserved for museums worldwide. RegistryPro's Elana Broitman says that these restrictions will help curtail purchases by cybersquatters.

  • "Complete the Revolution"
    Computerworld (05/07/01) Vol. 35, No. 19, P. 60; Lais, Sami

    Michael L. Dertouzos, director of the Laboratory for Computer Science at the Massachusetts Institute of Technology, has written a new book in which he argues that computers need to become human-centric in order for the Information Revolution to be completed. Human-centric computing emphasizes the role of the computer in helping humans, rather than forcing humans to act in ways that make it easier for computers to operate. For example, human-centric computers would rely on speech-recognition software, a natural form of human communication, and not force humans to sit at a keyboard and enter commands. Dertouzos contrasts this model of development with the idea of pervasive computing, a model in which more and more of human beings' daily lives are integrated with computer gadgets such as cell phones and handhelds. This, Dertouzos argues, will merely increase human beings' aggravation at the complexity of their lives, rather than ease it. As an example of why human-centric computing and thinking is needed, Dertouzos points to the rapidly increasing amount of email that each person must confront on a daily basis--1.5 hours a day and rising by some estimates. Technology is needed to filter out email that simply has no place in human communication, says Dertouzos--human beings have to quash the impulse to respond to every email that they receive. Dertouzos is optimistic that industry will pick up on this trend of human-centric computing, and he notes that Microsoft is trumpeting its new Hailstorm environment as being user-centered, while work is proceeding at MIT, the University of California at Berkeley, and other universities on the subject.
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