IBM to sell Lenovo kit by year-end

Lenovo kit will be available for sale from IBM by the end of the year, reports The Register (14 Mar.).

The Register says the Chinese computer maker intends to sell its consumer products through IBM's corporate sales network. The news follows approval from US regulators of Lenovo's US$1.25bn purchase of IBM's PC business. There were security concerns because IBM supplies so many US government and security agencies.

The online news service says the takeover was investigated by the US Treasury's Committee on Foreign Investment. Lenovo will move staff from IBM to its own dedicated site and will give up access to IBM's list of government clients, according to reports. There were fears that the Committee would insist on further restrictions.

The publications says Lenovo's main challenge now is to hold on to customers. A survey of 4,000 existing customers found 90 per cent in favour of the deal.

The Register says the firm will focus on laptops where margins remain stronger. Lenovo, formerly known as Legend Group, employs 9,000 people and turned over US$2.97 billion in 2004.

Blackberry expanding instant messaging

Instant messaging will become a more prominent feature on Blackberrys under separate agreements by Research In Motion, the maker of the popular wireless e-mail devices, with both America Online and Yahoo.

The New York Times/AP report (14 Mar.) that the software for AOL Instant Messenger, AOL's ICQ service and Yahoo Instant Messenger will be pre-installed on new Blackberrys in the coming months, the companies have just announced.

The paper says Canada-based Research In Motion also plans to allow owners of existing Blackberry models to download those applications to install on their devices. Instant messaging has been possible on one Blackberry model by using software downloaded from third parties, but this will mark the first time that Research In Motion has installed the applications on its devices, says the paper.

The NYT and AP say that with more than two million of the devices currently in usage, Blackberrys have become one of the most common ways to stay connected to e-mail and the rest of the internet while away from a desktop or laptop computer.Increasingly, many Blackberrys are equipped with cell phones as well.

The paper says that the deals aren't exclusive, leaving the door open for rival services such as Microsoft's MSN Messenger to negotiate similar deals with Research In Motion.

Alternative browser spyware infects IE

The Register reports (14 Mar.) that "some useful citizen" has created an installer that will "nail" Internet Explorer (IE) with spyware, even if a surfer is using Firefox (or another alternative browser) or has blocked access to the malicious site in IE beforehand.

The technique allows a raft of spyware to be served up to Windows users in spite of any security measures that might be in place, reports The Register, adding that security researchers have said that the malware installer was capable of working on a range of browsers with native Java support.

The Register quotes the researcher as saying that the spyware installer is a Java applet powered by the Sun Java Runtime Environment, which allows them to hit most browsers, including Firefox, Mozilla, Netscape and others.

The Register report says the malware is served with a variety of adware and spyware packages including Internet Optimizer, sais (180 Solutions) and Avenue Media. Thereafter, if victims allow the packages to install, victims will be bombarded with pop-up ads and their computer will be reduced to a crawl. The malware doesn't install automatically but managed web security firm ScanSafe reckons the pop-up dialogue it generates is obscure enough to fool most home users, says The Register.

ScanSafe reports an increase in spyware of 15 per cent over the last three months of 2004 compared to the previous quarter, reports The Register, adding that Adware accounted for three of the top 10 most prolific threats recorded by ScanSafe over Q4 2004. Spyware authors have thus far restricted themselves to targeting vulnerabilities in IE but ScanSafe says it's only a matter of time before they turn their attention towards alternative browsers, The Register reports.

Flat-Screen makers face patent lawsuits in US
 
Two industrial manufacturers, Guardian Industries and Honeywell International, have sued dozens of companies in the global PC and video display businesses in a US federal court to try to recoup royalties on liquid-crystal technology.

The New York Times/Reuters report (14 Mar.) thatGuardian Industries, a maker of industrial glass, and Honeywell, known for making weapons systems, assert in filings in the US District Court in Delaware that their intellectual property for liquid crystal displays, used in notebook computers, TVs, and cellular phones, have been infringed.

The paper and Reuters say that Taiwan and South Korea are the two primary centres of LCD production, which is growing rapidly as demand for LCD-based televisions rises. The lawsuits target the LCD industry directly, but also assert claims against companies that incorporate LCDs into final electronic products.

A director of LCD market research for research firm DisplaySearch, said the LCD business largely avoided patent lawsuits through its earlier years, but has attracted litigants as the business blossomed into a US$40 billion market, reports the NYT.

The NYT says privately held Guardian, based in Michigan, is one of the world's largest makers of fabricated glass products, and its mainstay is automotive and industrial glass. The company asserts rights on four patents related to the design and manufacturing of LCD displays. The patents cover technologies that affect the viewing zone and high-contrast features of LCD displays, according to court papers.

The paper says that in January, the company sued 14 companies, including PC makers Dell, Gateway and Acer; Taiwanese computer gear makers BenQ Corp.and Lite-On Technology; and Taiwan-based LCD manufacturers AU Optronics, Chunghwa Picture Tubes and Quanta Display.The defendants or their attorneys did not return calls for comment, although Dell filed court papers last week denying infringement and asking a judge to rule in its favor.

The NYT reports that Honeywell's case is pending in the same court. The company said late last year that it was targeting 34 electronics companies, including Apple Computer, phone maker Sony Ericsson Mobile Communications, and Japanese computer maker Fujitsu. It also sued Finland's Nokia, the world's largest cellular phone maker.

Honeywell claims that the companies infringed patented technology covering image brightness and interference reduction on LCD screens.

Honeywell, which filed the suit last October, has pointed to three large LCD makers, LG.Philips, Samsung Electronics, and Japan's NEC Electronics that it said have agreed to sign license agreements for the technology, says the NYT and Reuters.

Telecoms in Europe battle for market

Before the telecommunications bubble burst in 2000, blockbuster acquisitions were the only way that Europe's former phone monopolies could get into new geographic territory.

The New York Times/Herald Tribune report (14 Mar.) that now the telecom giants are taking the much more modest route of crossing borders to sell internet services, and rising competition has meant lower prices and improved service for businesses and consumers.

Across Europe, says the paper, phone companies are challenging one another outside of their home bases - Telecom Italia in France and Germany, for instance, and BT Group of Britain in Italy and Spain. This month, their gradual push abroad could get a jump start as Tiscali, the financially troubled Italian internet service provider, seeks to sell its French unit.

The NYT says the two companies seen as the most likely buyers for Tiscali France are Telecom Italia and Deutsche Telekom, and the price could be around 250 million euros, or US$336 million, according to some analysts.

The paper reports that two years ago, Telecom Italia began a controlled expansion outside of Italy into internet broadband services. It now has operations in France, Germany and the Netherlands.

BT Group has operations in Germany, Italy, Spain and elsewhere. Deutsche Telekom has moved into the high-speed internet market in France, Spain, Austria and Switzerland, while France Télécom has expanded in Britain, Spain and Poland, reports the NYT.

"Foreign expansion all but stopped after the tech bubble burst, and now we are seeing something of a renaissance in the broadband market," said Jouni Forsman, a principal analyst in Paris with Gartner, reports the paper. "The trend of incumbents looking abroad for broadband expansion is only going to increase," he says, as reported by the NYT.

About 90 percent of the broadband internet connections in Europe rely on a technology called ADSL., or asymmetrical digital subscriber line, which uses existing copper wires owned by the former monopolies.

While the volume of fixed-line phone calls has remained relatively constant, phone companies have had to cut prices to face the increased competition brought on by Europe's deregulation of the telecommunications market in 1998. That in turn has led to lower sales. Broadband internet access is helping to offset the decline in voice revenue, reports the NYT.

The paper reports that 12 percent of European households had broadband internet access at the end of 2003, with Italy among the laggards with 8 percent and Belgium leading the way with 25 percent, according to Gartner. Analysts now put the European average at about 20 percent and forecast that it will double by the end of 2007.

This rush to broadband has put the former monopolies on a potential collision course as they begin to grope about in one another's home markets, says the paper, adding that, so far, consumers have been the main beneficiaries, with prices falling and services improving as companies try to woo one another's clients.

The paper says the price for a basic broadband residential connection has declined by as much as 30 percent in some countries, helping to increase the number of subscribers, according to Gartner, which predicts that prices will stabilise and service providers will seek other ways to attract new clients.

The former monopolies still get just a fraction of their broadband revenue from their businesses outside their home market, says the NYT., and adds that Telecom Italia, for example, has four million broadband internet clients in Italy and 430,000 abroad.

Europe, US different telephone cultures

European and American culture differ in language, automobiles, sports and -- less obvious but no less important -- the way they use telephones.

The New York Times/Reuters report (13 Mar.) that choices made by governments and companies can mean that teenagers in Athens, Georgia, talk on their fixed line phone for four hours a day while those in Athens, Greece, are sending four text messages on their mobile phones.

The European Commission in Brussels is proud of its role in helping promote a uniform telephone standard across the European Union. The Federal Communications Commission in Washington is proud of its role in letting the market decide, says the paper.

The paper says that Europe touts the broad use of the GSM standard as a measure of success. It is now used in more than 100 countries around the world and has ushered in sophisticated multimedia telephone service in many countries.

On the other hand, the paper reports that the GSM system exists in the United States but so do other, inconsistent systems, reflecting the US policy of letting the market decide what technology to adopt.

An FCC report said American mobile users talk more and pay less than Europeans, citing it as "evidence that the US market is effectively competitive" compared to Europe and Japan, says the paper.

But eight of 10 European Union residents have mobile phone numbers while only six of 10 Americans do, the NYT and Reuters report.

And Western Europe mobile operators pulled in US$142 billion of revenue in 2004, compared to only US$104 billion in the United States, according to Ovum, a consulting firm in London, says the NYT, adding that the United States is catching up. US revenues grew at 11 percent, compared to only 9 percent for Western Europe, the paper reports.

The NYT says Europe's single-standard GSM, which stands for 'global system of mobile communications' reaches a broader audience than America's multiple-standard system.

Europeans can skip fixed lines altogether. Why bother? A GSM works nearly everywhere -- not just in houses, apartments and offices but at the bottom of a salt mine in Poland or on a wind-swept beach in County Donegal in northwest Ireland. The only real problem occurs on trains, reorts the paper.

Telephone charges are primarily responsible for shaping the different telephone cultures in the US and Europe, says the NYT - Europeans traditionally pay by the minute for both fixed lines and mobiles. Americans traditionally paid a monthly flat rate for unlimited local calls on wireline. But now they can pay to extend that to the whole country, no matter how many calls or for how long.

The NYT and Reuters say that as a result of the differing economics of the phone systems, there are different practices:

--Americans talk more. Flat-rate charges also helped get the Internet off the ground there because dial-up lines were not charged by the minute as in Europe.

--Europeans give out their cell phone number and put them on their business cards. They pay nothing to receive mobile phone calls in their home country.

--Americans traditionally have paid to receive mobile phone calls and tend to be less free about giving out cell phone numbers.

--American mobile subscribers get an allotment of minutes for a monthly fee and competition led to packages offering free nationwide calls nights and weekends.

--Europeans buy more limited packages -- especially geographically. Despite investigations by the European Commission mobile phone companies in Europe charge as much as one euro per minute to send or receive calls abroad.

--Europeans buy their own phones and easily switch phone companies or numbers by swapping tiny SIM card chips. So travelers sometimes buy inexpensive SIM cards to use abroad, receiving calls for free on a new, local number, reports the NYT and Reuters.

Catching the online cartoon virus

If you had internet access last fall, odds are that someone sent you a link to JibJab Media's irreverent cartoon "This Land," a musical parody of the presidential race. Now the internet is a-tingle with short video clips meant to repeat the phenomenon, reports The New York Times (13 Mar.).

The paper reports that organisations as disparate as Burger King and Greenpeace are producing offbeat video, hoping it will prove so entertaining that people will forward links to one another around the web - and cut through the clutter of marketing messages bombarding Americans. But will this "viral" technique just create new clutter online?, asks the paper.

The NYT says that even Consumers Union, the 69-year-old US publisher of Consumer Reports, has recently posted a musical cartoon online called "The Drugs I Need," parodying prescription drug marketing by depicting, among other oddities, a fellow whose medicine makes his eyeballs fall out.

Burger King's chicken sandwich promotion, a "Subservient Chicken" web site, is more interactive: about 14 million people so far have watched someone in a chicken suit appear to obey their typed commands. Last month, Georgia-Pacific began promoting its Brawny paper-towel brand by letting Web site visitors customise a video of a slightly goofy Brawny Man, who offers compliments like, "By the way, you look beautiful today - something about your eyes."

The NYT says the crucial feature of these sites is the button marked "tell a friend" or "send to a friend."

A co-founder of JibJab Media, said this kind of "viral marketing" spreads farthest and fastest when its content is topical but none too earnest.

Established advertising agencies see the value of the technique, reports the paper - Gary Goldsmith, chairman and chief creative officer of Lowe New York, said, "When brands play outside the boundaries of traditional media, they can do some really wonderful and entertaining things. Even the most jaded consumers are willing to reward that kind of creativity with their attention."

But, the NYT says that hot new marketing ideas are often quickly overused, and market watchers have said that before long, many "viral" efforts will probably fall flat, winding up as just so much unwanted slush clogging e-mail accounts. But the best ones will continue to stand out.