One of the most pervasive and costly types of virus is now affecting Mac computers, signalling the end of an age of innocence for Apple customers, who until now have been spared many common cybersecurity problems, the FT reports. Known as rogue antivirus or scareware, the scam programs warn PC and now Mac owners that they have been infected, then demand credit card payments to clean the machines. The operators of the programs are typically criminals who may resell the card details or try to install more malicious software.
Markets were enduring a classic “risk off” session as traders were rattled by evidence of slowing growth in China and the debilitating irritant that is the eurozone fiscal crisis, the FT’s global market overview reports. The FTSE All-World equity index was down 1.1 per cent and industrial commodities were sliding. US stock futures pointed to Wall Street opening lower by 1 per cent, starting a fourth consecutive week of declines, while the FTSE Eurofirst 300 was down 1.3 per cent as miners, financials and technology groups saw sellers. Investors were seeking the refuge of the dollar, Swiss franc, Treasuries and gold. A clue to the session’s risk aversion was being provided by the euro, which was down 0.9 per cent to $1.4008 and had hit a record low against the Swiss franc of SFr1.2352.
Amazon.com says it is selling more e-books for its Kindle electronic reading device than paperback and hardback print editions combined, helping its book business to see its strongest growth in more than a decade, the FT reports. The news that the online retailer has sold more than three times as many Kindle books so far this year as in the same period of 2010 came as the Association of American Publishers reported that US e-book revenues had grown 146 per cent in March over the same month a year earlier. Amazon only released unit sales data rather than comparable revenue figures, and Kindle editions typically sell for lower prices than print titles. However, the data suggest it may be extending its leading market share in e-books following the release five weeks ago of a cut-price Kindle at $114 for customers willing to accept sponsored screensavers and other advertising.
Intel has claimed the biggest breakthrough in microprocessor design in more than 50 years, raising the stakes significantly for rivals in the increasingly capital-intensive global chip industry, reports the FT. The world’s biggest chipmaker said on Wednesday that it would begin producing chips this year using a revolutionary 3D technology that has been nearly a decade in the making, and which it said would act as the foundation for generations of computing advances to come. Microchip transistors, the building blocks of electronics, have to date been produced in flat structures – akin to printing on a sheet of paper. Intel’s breakthrough involves producing more complex three dimensional transistors on chips.
Shares in Ericsson rose more than 8 per cent on Wednesday after the Swedish network equipment maker announced better than expected first-quarter results driven by surging use of mobile broadband services, the FT reports. Net profits more than tripled to SKr4.1bn ($674m) from SKr1.3bn in the same period last year, easily exceeding analysts’ consensus forecasts for about SKr3bn. Hans Vestberg, chief executive, attributed the strong results to rising demand for network infrastructure, such as radio base stations, as increased use of bandwidth-hungry smartphones and other mobile broadband devices prompts telecoms operators to increase capacity.
More than 70m users of Sony’s online gaming network have had their names, e-mail addresses and passwords stolen by a hacker in one of the largest privacy breaches to date, the FT reports. Sony announced on Tuesday that the information had been taken – six days after it closed the PlayStation Network – as it began e-mailing users of the free service with warnings to be on the lookout for scams. The Japanese electronics and entertainment powerhouse said it was possible that credit card information had been taken as well, recommending that customers who had supplied those numbers online should review their bills carefully. The breach is troubling because many Sony gamers are likely to have used the same passwords for e-mail and social networking accounts. The hacker could resell user name and password combinations to other criminals, who could take control of those accounts and mine them for bank account passwords or send bogus e-mails to friends’ addresses.
Research in Motion cautioned that its performance in the current quarter would be affected by costs associated with the launch of its PlayBook tablet device next month, disappointing investors who sold-down the stock in after-market trading, the FT reports. Shares in the Canadian company tumbled as much as 12 per cent in after-hours trading on Nasdaq before settling 10 per cent lower at $57.50. RIM also confirmed that its soon-to-be released PlayBook will be able to run software applications developed for other devices, including Android-based smartphones – a move that could enable it to compete more effectively with Apple’s iPad. Continued strong sales of its BlackBerry family of smartphones, particularly in markets outside North America, helped RIM report a 36 per cent increase in fiscal fourth-quarter revenues and a 32 per cent increase in net profits for the quarter ending February 28.
Oracle, the US software maker, claimed market share gains from rival SAP on Thursday as it reported quarterly earnings that showed a further rebound from the economic downturn, the FT reports. A better than expected 29 per cent rise in revenue from new software licences pushed the company’s earnings well above its own and Wall Street forecasts. Oracle issued a forecast for its current quarter ahead of most estimates and raised its dividend by 20 per cent. The company’s shares climbed 3 per cent in after-market trading, having already risen more than 2 per cent earlier in the day. Safra Catz, one of two Oracle presidents, would not attribute the group’s success to a broader recovery in IT spending, claiming it reflected the success of a wave of Oracle software products and the successful integration of Sun Microsystems, which it acquired early last year.
Hewlett-Packard added five new directors to its board, giving majority control of the world’s top-selling technology company to people who weren’t involved in the controversial August ousting of chief executive Mark Hurd, the FT reports. Four serving directors will stand down, while new chief executive Léo Apotheker and chairman Ray Lane, who both joined in late September, will be among the eight who remain, the company said on Thursday. The shake-up gives HP distance from the continuing fallout from the departure of Mr Hurd, a hard-driving executive whose resignation knocked $10bn off the company’s market value. “It’s very unusual” said Steve Mader, a director at recruiters Korn/Ferry International. “One of the obvious possibilities is that the decisions around Hurd and some of the subsequent actions were a schism or a factioning on the board”.
Skype plans to lift its headcount by nearly 50 per cent this year, reports the FT, as it looks to reinvigorate its lacklustre product development processes and capitalise on its viral consumer growth. The hiring spree marks an attempt by Tony Bates, Skype’s new chief executive, to inject urgency into a company synonymous with online voice and video calling. While its brand recognition and reach put it among the top handful of consumer internet companies, Skype has been slow to come up with a broad “premium tier” of services for which it can charge users – something Mr Bates aims to put right in a hurry.
Dell’s third-quarter profit more than doubled from a year ago on a 19 per cent increase in sales, easing concerns among technology investors about a slowdown in the sector, the FT reports. Shares in the second largest computer maker in the world by units shipped rose 5 per cent in after-hours trading on Thursday after the company said that all its divisions enjoyed revenue gains. In total, Dell said that net income reached $822m, or 42 cents a share, up from $337m and 17 cents, on revenue of $15.4bn. That encouraged investors alarmed by mixed results from Cisco Systems last week, although Dell cautioned that consumer demand remained “more muted” and it kept its full-year revenue guidance unchanged. Hewlett-Packard is set to report on Monday.
Fears that Google would allow its costs to spiral upwards as it prepared for a new wave of expansion proved unfounded in the company’s lastest quarter, as a jump in revenues and tighter controls led to earnings that comfortably beat analysts’ forecasts, the FT reports. The company’s shares jumped 8 per cent in after-market trading. The internet search company reported a 25 per cent jump in net revenues, to $5.48bn, as advertising continued to bounce back strongly from the downturn. Wall Street had been expecting a rise of only 20 per cent in net revenues, which are calculated after deducting the $1.81bn in traffic acquisition costs Google paid to other internet companies that generated some of its search traffic. Operating expenses, meanwhile, rose 34 per cent as the company continued to boost its spending on sales and marketing and on research and development. Headcount also continued to rise swiftly, rising by around 1,500, to 23,331, in the period.
Intel reassured markets at the start of the earnings season with third-quarter results ahead of its reduced expectations and a forecast of “healthy worldwide demand” for products for the rest of the year, reports the FT. Amid fears of a double-dip recession, the world’s biggest chipmaker had warned at the end of August of weaker demand than expected for computers in mature markets, reducing its sales forecast from about $11.6bn to $11bn. The “back-to-school” season was disappointing for PC makers in the US. Price-cutting is reported to have led to a recovery in September, meaning the “last four weeks of the quarter were better than we first thought”, according to Paul Otellini, chief executive. This had made Intel more optimistic about the fourth quarter. Intel shares closed at $19.77 in extended trading in New York.
Microsoft has sought to turn its back on more than decade of faltering performance in the mobile software business, betting heavily that it can use a new focus on design and marketing to recoup lost ground from Apple and Google, reports FT. The about-turn was on display on Monday as the software company took the wraps off a new family of smartphones based on its latest mobile software, called Windows Phone 7. A leader in the smartphone software world before the iPhone was launched three years ago, Microsoft has since seen its market share collapse to barely 5 per cent. Its sharp decline has led Microsoft executives to warn that its broader position in a new technology world, that depends on a range of personal devices that connect to services delivered over the internet, could be damaged unless it finds a way to fight back.
Cisco Systems, the top networking gear maker, has brought out its first homegrown product for consumers, a $599 gadget for videoconferencing from the living room, the FT reports. Cisco is aiming the premium device at US customers with high bandwidth, which analysts said would limit its potential for wide adoption, while the lofty purchase price and $25 monthly fee will discourage others. The New York Times Bits blog has a rundown of the new product.
Hewlett-Packard has already swooped in on Dell’s $1.3bn bid for data firm 3Par with a $1.6bn counter-bid, but the battle is far from over, reckons the NYT’s Dealbook. Dell needs 3Par to move into enterprise technology — and Oracle, the only firm that could outbid either firm, is so far absent. At any rate, deal-making in the tech sector is up 60 per cent in a year, says the FT, thanks to a slew of big transactions, and HP has been tracking the prospects of a 3Par bid for a while. A shame, then, that its valuation of the firm is ‘frankly bonkers,’ Lex argues, with 3Par not having made operating profit for half a decade.
June 8 2010 — Morgan Stanley says iPad will reshape netbook market.
August 20 2010 — Morgan Stanley downgrades Blackberry-maker RIM. Read more
Shares in Cisco Systems plummeted 8 per cent in after-hours trading on Wednesday after the firm’s chief executive John Chambers warned of ‘unusual uncertainty’ in the economic and revenue outlook, Reuters reports. Cisco’s warning sparked fears that a rise in technology spending could vanish before it has properly begun, following a set of disappointing results for IBM and Texas Instruments last month, says the FT.
Google is stepping up its rate of business acquisitions in order to make up for lack of growth from internal projects, Bloomberg reports — upping the pace to once every fortnight rather than just once a month. With deals being made with tech start-ups involved in everything from social network to gaming and graphic advertising, the company appears to be trying to keep pace with Facebook’s rapid growth. But the recent policy statement Google made with Verizon on changes to net neutrality is a threat to tech start-up growth, says the NYT.
It’s been a year marked by inconsistency for initial public offerings, and the tech sector has been no exception. There was a long period of drought until three companies — RealD, Qlik Technologies, and Smart Technologies – filed in quick succession last month.
But until Skype filed today, following Demand Media’s filing last Friday, it would have been easy to forget that since at least the end of 2009, a number of analysts and venture capital observers have been waiting for a larger wave of IPOs in the sector. Facebook, Zynga, LinkedIn, and yes, Skype, were all among the big names thrown around as possible listings. (To get a sense of the optimism, see this story quoting Renaissance Capital’s Paul Bard, or this interview with Mark Mehaney of Citi Investment Research.) The idea was that it would take just one big, successful filing for investor demand to explode. Read more
Solid demand for the latest iPhone and iPad tablet computer enabled Apple to report surprisingly robust sales and earnings on Tuesday, the FT reports. Apple reported revenues of $15.7bn (£10.3bn) for its latest quarter, a jump of 61 per cent and well ahead of the $14.74bn that most analysts had expected. Net income rose 78 per cent to $3.25bn. The FT’s TechBlog has a blow-by-blow of Apple’s blow-out quarter.
Intel reported the best quarter in its history as corporate customers increased information technology spending, boosting hopes that businesses are engaged in a long-awaited “refresh” of both hardware and software in the aftermath of the financial crisis, the FT reports. Separately, FT Alphaville notes that Goldman Sachs is really enjoying its new Apple iPad.
Abu Dhabi on Tuesday announced plans to bring the global chipmaking industry to the Middle East, as the emirate seeks to diversify its economy into knowledge-based industries, the FT reported. Ibrahim Ajami, chief executive of state-owned Advanced Technology Investment Company, said his company would invest in building a “capital intensive, manufacturing-driven cluster” technology cluster.
A strong international debut for Apple’s iPad lifted sales of the tablet computer to 2m since its US launch two months ago, the company said, outpacing sales of its flagship Mac laptop and desktop computers, the FT reported. The iPad’s debut exceeded that of the original iPhone but analysts said it fell short of the iPhone 3G, launched in 2008, which sold about 3m units in the first month.
Hynix Semiconductor, the world’s second-largest memory chipmaker, on Monday said it would raise its capital expenditure by a third to Won 3,050bn ($2.5bn) this year to take advantage of a strong recovery in the global technology sector, the FT reported. Hynix’s announcement comes two weeks after industry leader Samsung Electronics doubled its investment for semiconductors to Won11,000bn in an effort to cement its technology lead over rivals.
IBM on Monday mounted its biggest acquisition since 2007 as it reversed course and moved back into business-to-business software six years after quitting the market, the FT said. Big Blue agreed to pay $1.4bn in cash to buy Sterling Commerce from AT&T, the US telecommunications company that has owned it for the past decade. Sterling claims to handle more than 1bn transactions a year on behalf of 1,800 customers round the world.
Yahoo and Nokia, two companies under pressure from increasingly forceful competitors Google and Apple, have struck a broad alliance to strengthen their mobile internet offerings, particularly in emerging markets, the FT said. Yahoo will provide its e-mail and instant messaging services on all Nokia handsets, while the Finnish group will supply its mapping services to help Yahoo fight against Google’s similar applications.
Shares in Dell fell as much as 5 per cent in after-hours trading on Thursday, in spite of a 52 per cent jump in first-quarter net income, after the computer maker reported a thinner profit margin and warned of a coming seasonal slowdown in purchases by large businesses. The FT reported that the company’s earnings rose to $441m, or 22 cents a share, and revenue climbed 21 per cent to $14.9bn, paced by a 25 per cent boost in sales to big companies. Net income before severance and facility closure costs and amortisation of intangible assets rose 20 per cent to $584m or 30 cents a share, topping analyst expectations.