Oracle profit flat in first quarter; database business slowed

The Oracle Corporation, the software maker, said Thursday that its first quarter profit was flat because of sluggish growth in the company's database business.

The New York Times reports (23 September) that sales rose 25 percent, to US$2.77 billion, but fell short of the company's forecast despite a spate of recent acquisitions and an increase in customers. The company reported net income of US$519 million, or 10 cents a share, during the quarter, up from US$509 million, also 10 cents a share, a year earlier.

Excluding acquisition expenses and other charges, the company's earnings were 14 cents a share, an increase of 38 percent over last year's first quarter and in line with the forecast of analysts surveyed by Thomson First Call.

According to the NYT report, license revenue from Oracle's flagship database and middleware rose only 1 percent, to US$502 million, from US$492 million, with growth in the middleware unit offset by the sluggishness in databases. License revenue at Oracle's enterprise application business, which includes the business Oracle acquired through its takeover of PeopleSoft last year, increased 84 percent to US$127 million.

The  newspaper says that the chief executive, Lawrence J. Ellison, cautioned that the meager growth in Oracle's database business during the first quarter should not be interpreted as a sign of trouble, considering that the 20 percent growth rate the company had last year made for a tough comparison. Investors should look at the average of the quarters rather than each quarter individually.

VoIP is going to be massive. The effects of internet telephony are touching technology, business, culture, geographic penetration and consumer expectations in a way that is certain to turn the telecoms industry on its head, according to Benny Last, MD of telco IDT Europe, reports The Register (23 September).

The Register says that earlier this week the telco MD spoke about the impact of VoIP (Voice over Internet Protocol) on the global telecoms industry, telling delegates at the Carriers Conference in London that traditional voice providers "will need to make additions to their service offerings beyond voice" if they want to continue to compete in this new telco world order.

Mr Last said: "Enhanced offerings will include internet broadband access, media, IPTV [TV over the internet], online gaming, messaging...as well as 'next gen' services. They must enhance their service offerings because that is precisely what VoIP makes possible".

The Register says that, with VoIP operators springing up all over the place effectively piggybacking on broadband networks, traditional telcos will have to adapt or risk losing out.

The telco chief said: "VoIP is here, and it is not going away. We are in the midst of an explosive change in the way people use technology," The Register reports.

It's official: the UK's estimated 65 million mobile phones - or rather their users - are irritating their fellow man with their complete lack of consideration for others when jabbering away into their devices, according to The Register in a 23 September report.

The Register says that's according to a T-Mobile survey - conducted "between 27 July and 1 August 2005 from a nationally representative sample size of 5,116 participants" by YouGov - which has found that 62 per cent of Brit workers endure bad "mobile habits" in the workplace, eg: colleagues answering calls or reading texts in meetings. Sixty-one per cent of respondents admitted to this particular outrage, oblivious to the 87 per cent who said taking a call in a meeting was poor form, and the 80 per cent who reckon reading or answering a text in the same context is just not on.

The publicaton says that, accordingly, 37 per cent said they "make an effort to switch devices off during meetings and admit to feeling embarrassed if their device rings during a work meeting".

The Register comments: Interestingly, if 61 per cent of UK workers have yakked away during a meeting, but at the same time 87 per cent simultaneously suppress the urge to shove the mobile up the offender's backside, then there is a hefty percentage of people who, while infuriated by other people's transgressions, simply go ahead and do it themselves.

In other outcomes, the survey showed that seventy-three per cent of (media industry) respondents said their employer "does not offer guidelines on the use of mobile phones at work". It's scarcely better in the IT industry, where 65 per cent recorded a similar lack of advice.

Forty-one per cent, meanwhile, voted in favour of such guidelines "hoping to raise the standards of mobile manners", says The Register.

Security software giant Symantec has announced a deal to acquire behaviour-based security and anti-phishing developer wholeSecurity for an undisclosed amount. The transaction is expected to close in October.

The Register reports (23 September) that WholeSecurity has developed software designed to black malware based on its behaviour rather than by the more traditional approach of pattern recognition through regular anti-virus signature updates.

According to the publication, WholeSecurity's Confidence Online Phish Finder is included as the anti-phsihing component of eBay's toolbar. Symantec plans to use WholSecurity's technology to bolster its defences against fast spreading worms and so-called zero day attacks that target exploits for which a patch is yet to be issued, says The Register.

Microsoft will achieve one of its longest-held ambitions on Monday when its rival Palm Computing plans to announce that it will use Microsoft's Windows Mobile software in a new version of its popular cellphone-organiser, the Treo, reports The New York Times (24 September).

The newspaper says that Verizon Wireless, which will market the phone, will join in the announcement, according to several people involved. Emphasising the significance of the alliance for Microsoft, Bill Gates, its chairman, will be present.

According to the NYT., one feature not immediately available in the Windows software, however, will be the ability to push e-mail to users as it arrives, rather than forcing them to fetch it, according to an industry specialist with detailed knowledge of the announcement. Such a feature would be necessary to make the system a direct competitor to the BlackBerry, made by Research in Motion.

The Microsoft-Palm alliance marks an end of an era, says the NYT. Palm produced the first successful hand-held computer in the mid-1990's. In 2003, when Palm acquired Handspring, a company created by Palm's founders, it used the Handspring Treo to build its position in the market for cellphones with personal-organiser capabilities, the newsapaper reports.

The NYT says that Palm has struggled to find a compelling software direction and to replace its aging and fragile Palm operating system. At different times the company has shifted strategies, acquiring the Be operating system, experimenting with Linux alternatives and even contracting with Steve Capps, an Apple and Microsoft programming wizard, to develop software technology.

None of those efforts were successfully commercialised,says the NYT., and in the end Palm's chief executive, Ed Colligan, apparently decided that it was more expedient to join Microsoft than fight on as an alternative.

The newspaper says that Microsoft has led a long, costly and often frustrating campaign to gain an opening in the hand-held software world. Indeed, only in its next-generation mobile software, expected by the end of this year, is it reported to reach the industrial strength standards demanded by the consumer electronics industry, according to a range of industry executives, the NYT reports.

Sir Howard Stringer, the new chief executive of the Sony Corporation, unveiled a turnaround plan Thursday that would cut 10,000 jobs, shed unprofitable products and centralise decision-making at the struggling, sprawling Japanese electronics giant, known for its Walkman portable music players and PlayStation game consoles.

The New York Times reports (23 September) that, in a further sign of tough times, Sony said it expected to post its first annual loss this year in more than a decade.

The company said it now foresaw a loss of 10 billion yen, or US$90 million, for the fiscal year ending 31 March, down from a previously forecast US$90 million profit.

According to the newspaper, Sir Howard released his widely awaited plan three months after taking office in June. He promised to return Sony to profitability in the next year, saying that job reductions, product eliminations and other moves, including closing 11 of its 65 factories, would save almost US$2 billion over the next two and a half years.

But he admitted that cost-cutting alone was not enough to ensure Sony's future.

The NYT says the plan also includes organisational changes aimed at improving communication between Sony's notoriously autonomous divisions. Sir Howard said he hoped this cross-fertilisation would help create new ideas and products, allowing Sony to stay ahead of low-cost rivals in China and South Korea who are quickly climbing the technology ladder.

In the short term, that could mean consumers might see fewer lower-end electronics, like DVD players or even laptops, with the Sony name.

The newspaper reports that, iun the long run, though, analysts say the key to Sir Howard's success would be his ability to revive the sort of innovation and development that originally made Sony famous. One of the reasons the company has stumbled is a lack of hit products on the scale of the original Walkman portable music players.

Nintendo said on Friday it would cut the price of portable game device Nintendo DS by 10 percent across Europe on 7 October, a few weeks after Sony launched its rival portable machine.

Reuters reports in The New York Times (23 September) that the DS model will be priced at 89.99 pounds, 10 pounds less than its current retail price. In euro zone countries the device will be priced at 129 euros.

On the same day, Nintendo will introduce the Nintendogs game to the European market. A combined sale of the game with the DS device will be priced at 99 pounds or 149 euros.

Reuters says that Nintendo has dominated the portable video games market but has seen strong competition enter the market since Sony launched its PlayStation Portable (PSP). It was introduced in Europe last month after earlier introductions in Japan and North America.

The PSP, at 249 euros or 179 pounds, is significantly more expensive than Nintendo's Gameboy models and according to Sony is aimed at a slightly older game-playing audience, according to the Reuters/NYT report.

A California judge ruled Friday that Visa USA and MasterCard International don't have to send individual warnings to thousands of consumers whose personal account information was stolen during a high-tech heist uncovered earlier this year.

The Associated Press reports (23 September) in The New York Times that the ruling represents a setback for a consumer lawsuit targeting Visa and MasterCard for a computer security breakdown that occurred between August 2004 and May at CardSystems Solutions, a payment processor for merchants.

The AP/NYT report says that the breach, initially disclosed by MasterCard three months ago, exposed up to 40 million credit and debit accounts to potential abuse. The still-unknown computer hacker grabbed enough sensitive account information to defraud at least 264,000 accountholders, according to evidence gathered in the case so far.

Although the scope of the CardSystems break-in has been generally outlined, the credit card associations haven't sent warnings to the most vulnerable customers.

AP says that both Visa and MasterCard argued they shouldn't be obligated to send the notices because they don't have direct relationships with the accountholders, whose cards were issued by thousands of banks that belong to the associations.

Visa and MasterCard have maintained there is little financial risk to even the most vulnerable accountholders because of their ''zero liability'' policies that reverse all fraudulent charges.

In the US.,electronic payments company CyberSource on Friday said it intends to buy most of the assets of CardSystems Solutions, the credit-card processing company hit by a massive security breach earlier this year.

Reuters reprts in The New York Times (23 September) that CyberSource has signed a letter of intent to acquire the assets of privately held CardSystems for an undisclosed amount. The letter gives CyberSource exclusivity in its talks to buy CardSystems, and it sees any deal closing in the fourth quarter.

According to the Reuters/NYT report, CyberSource said it intends to acquire substantially all of the assets of Atlanta-based CardSystems. These include its payment processing platform with direct connections to major credit card association networks and banks as well as contracts to process credit card transactions on behalf of more than 120,000 merchants representing over US$18 billion in annual processing volume.

The Reuters report says that the move could potentially affect plans by Visa USA and American Express to cut their ties with CardSystems following the breach that exposed some 40 million credit cards to identity theft.