A new class of PC Netbooks 2.0 on the way

A new class of cheaper, smaller netbook computers might upset the IT establishment this year and potentially usher in new players in a hotly competitive market.

The biggest change in the new pint-sized laptops is what they won't have: Intel Corp chips or a Microsoft Corp Windows PC operating system, which dominate netbooks today.

The new netbooks, which use less energy, will run on the low-power ARM processor platform now used in nine out of 10 mobile phones, rather than Intel's x86-based Atom chip. The UK-based ARM Holdings Plc licenses the chip technology.

As many as 10 ARM-based netbook models could hit the market this year, according to ARM, which declined to identify specific manufacturers. Major PC players and Asian contract manufacturers alike are interested, analysts say.

Enderle Group analyst Rob Enderle called the new netbooks "incredibly disruptive," saying: "This is a market that puts the existing PC structure at risk."

While analysts say it's not yet clear if consumers will embrace the ARM devices, interest has been galvanized by the emphasis on power efficiency, prices as low as $200 and the promise of anywhere, anytime computing on PCs small enough to slip into a purse.

What's sacrificed is users' familiarity with PC-based interfaces and systems and sheer processing power. The current $300-$400 Atom netbooks are already mainly good for just surfing the Web and less graphics-intensive applications.

"We're right in the middle of a huge shift in the market," said Eric Openshaw, U.S. technology leader for Deloitte LLP.

Openshaw said non-Windows netbooks will need to demonstrate a simple and accessible user interface at the application level if they hope to gain traction with consumers.

Windows XP can't run on ARM, so the new netbooks will have Linux-based software, including, analysts and industry executives say, Google Inc Android, which has been used so far in smartphones.

But don't count Microsoft out just yet. Although the software giant declined to comment when asked if it is planning an operating system for the new netbooks, analysts say it could easily enter the market if it chose.

Intel pointed out there are as yet no ARM netbooks on the market and that its Atom chip has a full year's head start.

"We're not slowing down, we fully expect competition and we continue to believe that Atom is the right choice for our customers and consumer," said spokesman Bill Calder.

NEXT WAVE

The still-evolving netbook market is growing thick with players from all over the tech sector. Wireless carriers such as AT&T Inc are helping lead the charge, while graphics chipmaker Nvidia Corp, wireless chipmaker Qualcomm Inc and Freescale Semiconductor Inc have all designed ARM-based processors that can be used in netbooks.

The netbook phenomenon took off in 2008 to the tune of 11.7 million units, led by companies such as Acer Inc and Asustek Computer Inc that were quick into the market. Nearly every PC vendor offers an Intel Atom-based netbook, including Hewlett-Packard Co and Dell Inc.

Analysts forecast 20 million to 30 million netbooks will be sold this year, making up an ever larger part of overall laptop sales and marking one of few tech sectors still experiencing robust revenue growth.

"It's definitely going to be a different sort of device than today's netbooks," said Phil Solis of ABI Research, who expects ARM netbooks to make up 15 percent of the overall netbook market in 2010.

IDC analyst Richard Shim said the first wave of netbooks brought a PC feel to bridge the gap between laptops and smartphones. ARM netbooks, he said, represent a push from the opposite direction.

"The smartphones are now moving up," he added.

It is widely expected that the Computex trade fair in Taiwan in June will see a number of announcements about ARM-based netbooks. With less expensive ARM chips and free or very cheap operating systems, the netbooks could sell for even less than $200 if, as expected, wireless carriers subsidize purchases bundled with a data plan.

Tech blogs were recently buzzing about a prototype netbook built by Taiwan contract laptop maker Wistron Corp shown at the recent CTIA show in Las Vegas. The device was based on Qualcomm's ARM-based Snapdragon platform.


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Employees of Wipro asked to work 2 days a week

Wipro, the third largest Indian IT service giant has introduced a scheme under which employees in the bench has to come for two days in a week. "We found value in people being given flexibility instead of asking them to come to work when there is no work," said Girish Paranjpe, Joint CEO-IT, Wipro.

The scheme named 'Project Enrich' has also given an alternative to the employees that allows them to work 10 days a month, with a pay that is 50 percent of their cost to company (CTC). They will be absorbed back into projects once deployment opportunities come up. The scheme has already enrolled 1000 of their employees.

The company has also introduced Project Rejuvenate, which is though primarily aimed at benched staff, will also be open to some senior employees. The scheme will allow them to take a leave for one to one-and-a-half years, while they will be offered 25 percent of their CTC. Currently, the company has 10-12 percent of overall employees in the bench which will surge as it plans to recruit more 6,000 employees. "They are good resources and we don't want to lose them. We don't want to do anything drastic as well," said Pratik Kumar, Head of Human Resources (HR) at Wipro.

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SAP Unviels Co-Innovation Lab in Bangalore

SAP AG formally launched its Co-Innovation Lab in Bangalore, the third such lab in the world by the company. The lab that started its operation in October last year, joins the league of similar labs in Palo Alto and Tokyo. "The main goal of this lab is to create a platform for collaboration between SAP and its customers and partners on solutions to different challenges in the industry", said Satyajit Singh Mecker, Senior Vice President, Global Ecosystem and Partner Group.

The SAP Co-Innovation Lab hosts a simulated heterogeneous datacenter, integrating hardware and software from SAP and other participating sponsors. "This lab is not like a R&D lab, but it is a real lab, where partners and customers can solve their problems by collaboration", said Satyajit.

Wipro Technologies, a SAP partner, was one of the first to benefit from this SAP initiative. An Insurance Claims Analytics solution was developed by Wipro by working on a platform that was developed in the SAP Co-Innovation Lab. Some of the other partners associated with the lab include Cisco, HP and Intel.

SAP India that now has over 3,800 customers with 2,900 SMEs in the list, wants to tap the potential in the Indian market by this collaborative effort. "India, especially Bangalore has been a region that has seen explosive growth and the global meltdown has not diminished its stature in the global market", said Dr. Axel Henning Saleck, Vice President and Head of the Global SAP Co-Innovation Labs.

"In 2006, SAP had announced a total investment of one billion dollar in India over 5 years and establishment of this lab is part of the investment", said Satyajit. According to Satyajit, the company sees tremendous potential in the Indian market in segments like information technology, engineering, construction, chemicals and automotive. "The current challenge that we see in India is to maintain a balance between customers and partners and keep the focus right", added Satyajit.

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Will Yahoo layoff 700 more jobs?

Yahoo Inc said it would cut 5 per cent of its global workforce (nearly 700 jobs) and reported quarterly results that showed progress towards controlling costs, sending shares higher in an after-hours relief rally.

The Internet company said economic conditions remained challenging, as revenue on Yahoo Websites from both display ads and search ads fell during the first quarter.

But the decline in revenue was offset by better cost controls, as new Chief Executive Carol Bartz seeks to revive Yahoo's fortunes. "People were really looking at the profit structure of the business and for things not to be falling apart," said Kaufman Brothers analyst Jason Avilio.

Yahoo said last October it would cut about one-tenth of its workforce, or about 1,600 jobs. The company finished 2008 with roughly 13,600 employees and said it would take severance charges from the new round of layoffs during the second quarter.

The company also announced in an internal memo to employees on Tuesday that it planned to implement a mandatory shutdown of operations during the holiday week of December 25, 2009 through January 1, 2010.

Yahoo said its operating cash flow, excluding certain items, was $409 million in the first quarter, at the high end of the $365 million to $415 million range it forecast in January.

Yahoo shares were up 54 cents at $14.92 in after-hours trading on Tuesday. The company's stock is up roughly 9 per cent from its Monday close of $13.66.

Yahoo's financial report comes as speculation has mounted that the firm has restarted discussions with software giant Microsoft Corp about an Internet search partnership, following last year's failed merger negotiations.

Bartz, who replaced Yahoo co-founder Jerry Yang in the top job in January, declined to comment on anything related to Microsoft during the conference call on Tuesday.

But she reiterated her belief that search is a very valuable part of Yahoo's business.

"I'm well-versed enough in the search business at Yahoo to say it's absolutely critical to Yahoo," Bartz said in response to a question regarding whether she is now familiar enough with the business to respond to an offer for search.

In the first full quarter under Bartz's leadership, Yahoo generated revenue of $1.58 billion, down 13 per cent from the year-ago period. Exclud
ing traffic acquisition costs (TAC), Yahoo's revenue was $1.16 billion, compared with the average analyst expectation of $1.2 billion, according to Reuters Estimates.

The Sunnyvale, California-based company reported a net profit in the first quarter of $118 million, or 8 cents a share -- down from $537 million, or 37 cents a share, a year earlier. Wall Street analysts, on average, had forecast earnings at 8 cents a share, according to Reuters Estimates.

While revenues were "a bit light," Jefferies & Co analyst Youssef Squali said in an email that Yahoo's overall results, particularly on the bottom line, were not bad given the environment.

Yahoo said that revenue from display ads on its owned and operated websites slid 13 per cent year-over-year in the first quarter, with revenue from automotive advertisers down "substantially" and spending by retail advertisers "softened" compared to the year ago period.

Revenue from search-based ads on Yahoo sites were down 3 per cent. And Yahoo said that advertisers were spending less money to bid for the individual keywords that their ads appear alongside, echoing a theme present in results last week from Google Inc, the No.1 US Internet search company.

Yahoo, like Google, stressed the importance of keeping costs in line amid the difficult economy. The new round of job cuts come about two months after Bartz announced a reorganization of Yahoo's internal management structure.

The layoffs, said Bartz, are a "natural outgrowth" of the reorganization, which will allow Yahoo to streamline its operations and eliminate duplication of efforts.

The Internet company said it would also continue to implement unspecified "non-headcount cost reductions," so it can increase its ability to make strategic investments and target hiring in its core operations

"It's crucial that management adjusts the cost structure to the new growth (or lack thereof) realities; so margin protection is paramount to Yahoo right now," said Jefferies analyst Squali. "We think there is potential outperformance on margins."

Chief Financial Officer Blake Jorgensen told Reuters there were "still very dark clouds on the horizon" for the economy.

"I'll try to resist calling the bottom in any way," he said in a telephone interview.

Yahoo projected that sales in the current quarter would range between $1.425 billion and $1.625 billion.

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Has Conficker attacked thousands of PCs globally?

A malicious software programme known as Conficker that many feared would wreak havoc on April 1 is slowly being activated, weeks after being dismissed as a false alarm, security experts said.

Conficker, also known as Downadup or Kido, is quietly turning thousands of personal computers into servers of e-mail spam and installing spyware, they said.

The worm started spreading late last year, infecting millions of computers and turning them into "slaves" that respond to commands sent from a remote server that effectively controls an army of computers known as a botnet.

Its unidentified creators started using those machines for criminal purposes in recent weeks by loading more malicious software onto a small percentage of computers under their control, said Vincent Weafer, a vice president with Symantec Security Response, the research arm of the world's largest security software maker, Symantec Corp.

"Expect this to be long-term, slowly changing," he said of the worm. "It's not going to be fast, aggressive."

Conficker installs a second virus, known as Waledac, that sends out e-mail spam without knowledge of the PC's owner, along with a fake anti-spyware program, Weafer said. The Waledac virus recruits the PCs into a second botnet that has existed for several years and specializes in distributing e-mail spam.

"This is probably one of the most sophisticated botnets on the planet. The guys behind this are very professional. They absolutely know what they are doing," said Paul Ferguson, a senior researcher with Trend Micro Inc, the world's third-largest security software maker.

He said Conficker's authors likely installed a spam engine and another malicious software program on tens of thousands of computers since April 7.

He said the worm will stop distributing the software on infected PCs on May 3 but more attacks will likely follow. "We expect to see a differen
t component or a whole new twist to the way this botnet does business," said Ferguson, a member of The Conficker Working Group, an international alliance of companies fighting the worm.

Researchers had feared the network controlled by the Conficker worm might be deployed on April 1 since the worm surfaced last year because it was programmed to increase communication attempts from that date. The security industry formed the task force to fight the worm, bringing widespread attention that experts said robably scared off the criminals who command the slave computers.

The task force initially thwarted the worm using the Internet's traffic control system to block access to servers that control the slave computers. Viruses that turn PCs into slaves exploit weaknesses in Microsoft's Windows operating system. The Conficker worm is especially tricky because it can evade corporate firewalls by passing from an infected machine onto a USB memory stick, then onto another PC.

The Conficker botnet is one of many such networks controlled by syndicates that authorities believe are based in eastern Europe, Southeast Asia, China and Latin America.

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Does cost cuts help tech giants ride out weak economy?

A solid crop of earnings reports from the leading lights of technology suggests the sector is proving adept at cost cuts and more resilient to the economic meltdown than previously thought.

While executives from Apple Inc, Google Inc, IBM and Intel Corp were almost uniformly cautious in talking about the rest of the year, they all reported quarterly profits that beat Wall Street expectations.

Microsoft Corp's earnings on Thursday were in line with forecasts, but investors sent its shares higher in part because of cost cuts that the world's largest software maker is undertaking to protect its bottom line.

With corporate and consumer spending under pressure, analysts say many tech companies moved swiftly to slash jobs and output- positioning themselves for growth when a bottom is reached, which some say may have happened already.

"It does look like tech might very well lead us out of the recessionary market," said Enderle Group analyst Rob Enderle. "They are structured to respond more quickly and they've demonstrated they can."

Although the results were not necessarily strong on a historical basis and the outlook for the economy remains extremely uncertain, analysts see positive signs for the sector.

Technology shares have been surging, with the Morgan Stanley Hi-Tech index of major tech stocks up more than 30 per cent since early March.

While a rally may prove difficult to sustain, analysts say the prospects are better for an IT recovery because tech products and services are integral to the day-to-day functioning of the global economy and people's lives.

"Everybody's taking big cuts in their budgets, but a lot of tech spend is not so variable," said M Eric Johnson, director of the Center for Digital Strategies at the Tuck School of Business at Dartmouth. "A lot of their spending needs to and has to occur even in a downturn."

He said the recession in some ways has benefited information technology service providers like IBM, as corporations have moved to outsourcing.

IBM reported an 11 per cent drop in revenue, which was weaker than expected, but higher margins helped its profit beat analysts' forecasts.

There were other encouraging signals in major tech earnings reports. Apple's earnings topped Wall Street forecasts as consumers showed they were still willing to spend on premium devices such as iPhones and iPods even in a tough economy.

Google's and Intel's results also beat expectations, thanks to cost discipline. Intel Chief Executive Paul Otellini declared the worst is over for the PC market, a message echoed by disk drive maker Seagate Technology, but Microsoft Chief Financial Officer Chris Liddell said he saw no sign the bottom had been reached.

Positive signs also emerged from earnings reports from chipmaker Texas Instruments and flash memory maker SanDisk.

"Things at least seem to have stopped falling," said Barry Jaruzelski, a partner at consulting firm Booz & Co He said the key is in how enterprise IT spending plays out.

"It looks like we've found the reset level...The thing IT has going for it is it's often an enabler for cost reductions."

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The rise and fall of oil prices since 2008

Oil prices have steadied at around $50 a barrel this month as markets begin to find their equilibrium after a dramatic spike to nearly $150 in the first half of last year gave way to an unprecedented collapse to near $30.

Asian energy ministers and their Middle East counterparts meet in Tokyo on Sunday to discuss the outlook for prices.

Here is a brief timeline charting the price highs and lows since January 2008.

Jan 2, 2008: US crude briefly breaks the $100 barrier for the first time on the first trading day of 2008. Prices rise fairly steadily through the first half of the year.

March 5: Despite new record price highs of over $104 a barrel, Organisation of the Petroleum Exporting Countries (OPEC), which pumps more than a third of the world's oil, says it will not put more oil on the market. It says there is enough oil, and blames US economic "mismanagement" for global prices.

June 6: Prices surge $11 to a record high near $139 a barrel on a slumping dollar and mounting tensions in the Middle East. Soaring crude leads a frenzied broad-based commodity rally on US grains and oilseed futures markets.

June 7: Average retail price for regular gasoline tops $4 a gallon for the first time in the United States.

July 11: Oil peaks at $147.50 for Brent and $147.27 for US crude.

July 15: A sell-off begins after remarks by Federal Reserve Chairman Ben Bernanke indicating a significant fall in demand in the United States, the world's top consumer.

July 18: Oil prices drop by more than $18 from a week ago to $128.88 per barrel. The price fall is triggered by a 3 million barrel increase in US crude stocks and falling US demand.

Aug 15: Prices continue sharp decline, falling to around $110 a barrel for Brent crude.

Sept 15: Prices below $100 a barrel for first time since March 4, and still falling.

Sept 22: Oil spikes $16 in biggest one-day gain on record. Prices pop over $120 a barrel, extending a climb from a low near $90 the previous week after the United States unveils a sweeping rescue plan for its battered financial sector.

But soon after, oil prices begin a heavy slide. Nov 21: National average price of regular gasoline falls below $2 a gallon for first time since March 2005 - dropping 3.1 cents to $1.989.

Dec 19: Oil drops below $34 a barrel - charting about a 75 per cent loss of value since July.

Jan 2, 2009: Oil falls more than $3 on first day of trading, with US crude at $41.25 a barrel and Brent at $42.18.

April 24: US crude just below $50 a barrel, Brent just above at $50.29.

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