Hewlett earnings in line with estimates

One week after jolting Wall Street by ousting its high-profile chief executive, Hewlett-Packard reported no big surprises when it announced quarterly earnings in line with Wall Street forecasts.

The New York Times reported (17 Feb.) that Hewlett-Packard's revenues increased by 9.9 percent when compared with the same quarter a year ago, rising to US$21.5 billion, from US$19.5 billion. That was slightly better than the US$21 billion analysts had expected.

The company's earnings report came as its board of directors was one week into its search for a chief executive to replace Carly S. Fiorina.

Late last year, the company indicated that it would reduce its work force. When an analyst asked whether the company's announcement of a US$60 million "work force reduction" charge meant it was laying off 600 people this quarter, a spokesman responded that the estimate of 600 people was certainly low, adding that the work force reduction charge for the second quarter would be close to US$140 million.

The NYT said the company posted a profit of US$943 million, or 32 cents a share, up slightly from the US$936 million, or 30 cents a share, in net income from the first quarter of 2004. Hewlett had previously announced that its agreement to pay US$141 million to settle patent disputes with the Intergraph Corporation, a software maker, would reduce earnings for the first quarter by roughly 3 cents a share.

The company also announced second-quarter revenue projections of US$21.2 billion to US$21.6 billion, which would be slightly higher than what analysts had been estimating.

The paper further reported that Hewlett-Packard's printer business has been its most consistently profitable unit, yet sales of printers to consumers were down 13 percent, compared with the same quarter last year. The company earned US$932 million in profits on its printer and imaging business in the first quarter, down US$35 million compared with the same period last year.

Updated MyDoom targets Google--again

Another variant of the MyDoom worm, which spreads by sending copies of itself using its own SMTP engine and harvesting potential e-mail targets from search engines such as Google and Yahoo, has been spreading quickly on.

The New York Times says (17 Feb.) that in August 2004, a MyDoom variant pumped so many queries into Google that the search engine was unavailable or very slow for large periods of time. The same variant of MyDoom also succeeded in knocking a number of smaller search engines--including Lycos and Altavista--off the web completely.

The paper reports that antivirus firm Sophos has said the latest MyDoom variant searches an infected computer's hard disk for e-mail addresses and then reverts to an internet search. Interestingly, the worm tries to search the internet for e-mail addresses in the infected computer's domain--effectively targeting all users from a specific company or service provider.

According to a Sohpos advisory, the worm will send a query to the search engine using domain names from e-mail addresses found on the hard disk and then examine the query results, searching for more addresses.

A senior technical consultant at Sophos in Australia and New Zealand, said that the latest variant was first detected early yesterday morning and as long as people have updated their virus definitions it shouldn't cause much of a problem.

The NYT quotes Sophos as sdaying that the worm will send 45 percent of its queries to Google, 22.5 percent to Lycos, 20 percent to Yahoo and 12.5 percent to Altavista.

Antivirus firms Sophos, Computer Associates and Symantec all agree that the worm is spreading quickly but is relatively simple to remove using their latest antivirus definitions.

Time to regulate software industry?

A panel of security experts this week debated the merits of regulating the software industry to curtail software flaws--and hence reduce the volume of virus attacks.

The New York Times reports (17 Feb.) that with software flaws serving as the open door to viruses and worms, a panel of industry experts at the RSA Conference in the US debated whether it's time to regulate software companies. The experts were mixed on the effectiveness of such a plan and whether it could be undertaken without curtailing innovation.

Dick Clarke, chairman of Good Harbor Consulting and former presidential special advisor on cybersecurity, noted efforts to have industries develop guidelines and follow through have failed in the past, and he pointed to a deal Michael Powell, outgoing Federal Communications Commission chairman, struck with internet service providers (ISPs).

Powell held a meeting with ISPs, says the paper, where in they developed guidelines. And although Powell threatened to regulate their industry if they did not abide by those guidelines, the ISPs did not adhere to those self-imposed practices.
"Powell bluffed them. They knew it, and now he is leaving office," Clarke said.

Other panelists, such as one encryption expert, also called for more action in prompting software vendors to vet through their code before releasing it to the market.

It was noted that companies that currently take the time to test the security of their software before releasing it to the markets are at a disadvantage--higher costs and potential late arrival to the market.

Better lasers from chips

Intel researchers have made an important advance in blending silicon chip technology with optical lasers. The new approach could lead to a significant cost reduction in high-speed communications systems by the end of the decade, as well as new low-cost medical and military applications for lasers, researchers say.

The New York Times says (17 Feb.) that in a report in the magazine Nature, the Intel researchers described the construction of a silicon laser that generates a "Raman effect" that greatly increases the power of a laser.

The Raman effect - in which light is amplified when it passes through a transparent material - is now used to extend the range of lasers used in communication systems based on glass fiber.

The new Intel process miniaturises the Raman effect so it can be produced within a single silicon chip rather than requiring strands of glass fiber that stretch for miles. The Intel researchers were able to demonstrate that the effect is 10,000 times as strong in silicon as has been achieved in glass fiber.

The paper reports that the advance also means it may be possible to create silicon lasers using Intel's standard chip-making technology. That could sharply reduce the cost of creating optical electronic components like amplifiers, wavelength converters and other types of lasers, which are now made using bulkier mechanical assembly techniques.

Today, most long-distance data and voice communications are transmitted via fiber optic cable systems, while desktop computers and office networks are connected by metal wires. Many in the computer and telecommunications industries say the speed of computers could be increased if the chips within computers were connected by glass fibers rather than by metal wire.

A number of researchers said that Intel's interest in optical communications was largely driven by a need to get around the inherent speed barriers in metal wires that limit the performance of computers.

According to the paper, the Intel group has made several recent advances in silicon photonics. Last year, it reported the design of a silicon-based modulator, which permits the lasers to be switched on and off, enabling them to carry data.

Napster refutes flawed protection claims

Less than three weeks after Napster began touting its all-you-can-rent music subscription service, the company finds itself refuting internet claims that its copy-protection measures are flawed.

The New York Times/AP report that the company posted a message this week, saying the service's digital music tracks are no more susceptible to unauthorised copying than any other licensed music service.

The statement comes after word surfaced on the internet about how subscribers of Napster To Go, which lets users play an unlimited number of tracks on their computer or on certain portable devices for about US$15 a month, could make permanent copies of the songs.

The method involves downloading a free audio player that is able to record audio directly from a computer's sound card, bypassing copy-protection technology designed to prevent copying. Such a method could potentially harm the prospects for the company's new service.

The paper reports that in its statement, Napster compared the process described on the Internet to copying songs from the radio onto cassette tapes, saying that the program does not break the encryption of the files, which can only be recorded one at a time making the process quite laborious, possibly taking up to 10 hours to convert 10 hours of music in this manner.

Cellular companies aim to cut phone porn

Wireless companies are under pressure to police the services they carry amid mounting concern that today's increasingly versatile cell phones can be gateways to a lot more than football highlights and pop videos.

The New York Times sayd that as governments and parent groups wake up to the problems posed by an expected global boom in mobile pornography and gambling, a few operators are taking action to restrict such content to over-18s.

The Vodafone, which has operations in 26 countries, backed voluntary age checks and content filtering in Britain and is urging partners and rivals to avoid heavy-handed regulation by supporting similar moves elsewhere in the world.

A company spokesman was speaking at the annual 3GSM World Congress on the French Riviera, which ends Thursday - the four-day mobile industry gathering was abuzz with the arrival of a plethora of third-generation phones and services offering speedy connections to a widening array of multimedia content.

The paper says that alongside the handset makers displaying their '3G' products in Cannes, there were almost twice as many content exhibitors listed as last year -- companies from Anxa Europe, an interactive software developer, to the self-explanatory XXX Providers.

Under voluntary British rules drawn up with groups including the National Family and Parenting Institute, wireless networks bar adult services to new handsets by default and lift the restrictions only after receiving proof that the user is 18 or over.

According to the paper, industry initiatives are also under discussion in the United States and France, while Germany already has statutory rules and the Australian government has published a draft bill it plans to introduce in parliament.

The NYT also reported that not far from the beachfront auditorium where the 3GSM congress was being held, at a booth in the exhibit hall, a French company named 1633 Publishing was showing off its licensed Playboy phone content and celebrating its recent acquisition of the exclusive global rights to distribute Pamela Anderson images over mobiles.

And, at the next booth, Andreas Adami of Italy's Princess Productions was talking visitors through the pornographic film maker's lucrative sideline in mobile screensavers, videos and other content.

The paper says that Vodafone is pressing rivals in countries such as Spain and Italy to adopt filtering.

Mobile operators fear being cast as pornographers, but they also want to avoid being seen as censors by the providers of lucrative wireless services -- a key business opportunity in an industry where the main source of revenues, phone calls, is afflicted by price wars.

The ICRA, funded by the European Union and by the industry, is fighting an uphill battle for filtering standards capable of screening out indecent or violent Web content. As such, the group prefers to see the stricter default-bars and age checks on mobiles, the NYT report adds.

Philadelphia hopes to lead the charge to wireless future

The 135-square-mile US city of Philadelphia is looking to become one gigantic wireless hot spot, offering every neighborhood high-speed access to the web at below-market prices in what would be the largest experiment in municipal internet service in Amerca.

The New York Times reports (17 Feb.) that city officials envision a seamless mesh of broadband signals that will enable the police to download mug shots as they race to crime scenes in their patrol cars, allow truck drivers to maintain internet access to inventories as they roam the city, and perhaps most important, let students and low-income residents get on the net.

Experts say the Philadelphia model, if successful, could provide the tipping point for a nationwide movement to make broadband affordable and accessible in every municipality, reports the NYT., adding that more than 50 local governments have already installed or are on the verge of creating municipal broadband systems for the public.

But, the paper says, Philadelphia's plan has prompted a debate over who should provide the service, and whether government should compete with private industry, particularly in hard-to-reach rural areas or low-income urban communities. Telecommunications and cable companies say that municipal internet networks will not only inhibit private enterprise, but also result in poor service and wasted tax dollars. They have mounted major lobbying campaigns in several states to restrict or prohibit municipalities from establishing their own networks.

Philadelphia officials say that will not happen, and they will try to raise corporate and foundation financing so the strapped city does not have to pay the network's UA$10 million startup costs. The city will recruit private companies to help operate the system, asserting it will earn enough revenue to be self-sustaining.

According to the paper, Philadelphia expects to install 4,000 wireless antennas along lampposts across the city in the next 18 months, creating a network of broadband signals, and they hope to extend service into homes and businesses in poor neighborhoods, using nonprofit organisations to provide low-cost equipment, training and service.

Industry officials say that if the program takes off, it will inevitably take customers from providers like the Comcast Corporation or Verizon Communications.

The paper reports that pushed by industry lobbyists, lawmakers in Kansas, Ohio, Texas, Indiana, Iowa, Oregon and other states have proposed legislation to restrict or prohibit local governments from offering telecommunications services. and nearly a dozen states have already enacted some restrictions.

Motorola names Procter & Gamble exec to board

Mobile communications maker Motorola has announced that James Stengel, who is Procter & Gamble's global marketing officer, has joined its board of directors, effective immediately.

The New York Times/Reuters rerport (16 Feb.) that Stebgel is chairman of the board of the Association of National Advertisers and serves on the board of The Ad Council, and his appointment brings the number of Motorola board members to 14.

Dolby Labs raises US$495 million in IPO

Dolby Laboratories, a developer of music and motion picture sound systems, raised US$495 million in an initial public offering, putting a valuation on the company that makes its founder, Ray Dolby, a billionaire.

Dolby Laboratories sold 10.5 million Class A shares at US$18 each, while its founder sold 17 million shares, the company, based in San Francisco, said yesterday.

The New York Times/Bloomberg report (17 Feb.) says that Dolby increased the offering price from the range of US$13.50 to US$15.50 it estimated earlier this month. The company developed a system in the 1960's that reduced background noise in tape recordings. In the 1970's, the Dolby surround-sound system was used in theaters for films including "Star Wars." Dolby products have been used in the production of more than 16,000 movies, thousands of DVD titles and hundreds of video games, the company said in a filing. Mr. Dolby, 71, founded the company in London in 1965 after he got a doctorate in physics from Cambridge University. He is board chairman and got $306 million in the offering.

In the 12 months ended 24 September, the company had net income of US$39.8 million on sales of US$289 million. Net income was US$30.9 million on revenue of US$217.5 million a year earlier.