Proxicom ultimately spurned Compaq but sources tell me the company is on the prowl to pick up another high-end services provider. The pressure is on to increase that piece of the business to 30 percent of total revenue from the current 21 percent. A deal isn't likely to hit the street next week, but who knows?
"Who knows" is a fine way to start any ruminations about the next chapter in the Microsoft saga. Make that the never-ending Microsoft saga. The good justices on the U.S. Court of Appeals are still mucking around with a decision about what to do with Judge Jackson's breakup order. With the approach of the dog days of a typically brutal Washington summer, the court's vacation time is around the bend. Could next week be when we hear a decision?
Lineo will announce a deal to supply Linux technology to Sharp for that company's next generation of Zaurus personal digital assistants.
Alcatel and Lucent are going into the weekend still negotiating merger terms. This may or may not result in an agreement. But if they do clinch a deal, I hope somebody from Lucent's brass prevails upon their opposite number to drop those idiotic commercials Alcatel's been running the last couple of months.
And is another brief star from the dot-com era about to flame out? Word has it that Business 2.0 will publish its last edition after parent company Imagine Media and AOL Time Warner announce a deal to fold Business 2.0's name and subscriber list into Time's eCompany Now.
The week that was
America Online announced plans to raise its monthly subscription prices by $1.95 because....well, because it can. Though a harbinger of bad news for consumers--the other ISPs will follow suit, mark my words--it's a smart move by AOL. The company can sell it as a relatively painless increase--hey, the price of three Snickers bars each month--in return for providing "value-added services." And more importantly, from AOL's perspective, it's also a guarantee of an extra $300 million per year. This despite the self-serving spin of an MSN spokesman who rhetorically asked why AOL "expects its customers to pay a premium for a service that does not offer the same level of features and functionality that can be found standard on MSN." Puh-leeze.
So now Vivendi owns MP3.com, how should history judge MP3.com CEO Michael Robertson? Yes, the company will survive, albeit as an outpost in the sprawling Vivendi empire. But the sale, which was forced by desperation, signals the end of the promised music revolution in which the Internet would rock the world of the music moguls. Try as he might, Robertson was unable to undo the effect of a huge blunder which required MP3.com to pay out more than $150 million in lawsuit settlements with several big music companies. A cynic--well, at least this cynic--might argue that the litigation pursued by Vivendi and the other big studios came about precisely because they sought to drive down MP3.com's share price until it could be snapped up for a song.
The Supreme Court is going to revisit the 1998 Child Online Protection Act, a statute that was supposed to prevent commercial sites from selling sexually explicit material to minors. COPA, a good idea that was badly conceived, never got put into practice as it was met by repeated court challenges from free-speech advocates who correctly noted it would stifle Internet speech.
What is it about Microsoft and the number three? Seems that nearly every big project undertaken by the Redmondians results in an underwhelming product--but the third time is a charm. So it was with Windows. So it was with NT. And so it apparently is with Pocket PC, which marks the company's third attempt at an operating system for handhelds. Less than a year after its introduction, there are now about 1.25 million Pocket PC units in the market. Unlike Palm, Pocket PC's strength has been the corporate market, the economic slowdown of the last several months notwithstanding.
Meanwhile, Microsoft finally put its 64-bit version of Windows XP into customer hands for testing. This operating system, which will presumably wind up on servers powered by Intel's Itanium chip, isn't going to hit the market before the late October release of the 32-bit version of Windows XP.
Here's something straight out of the funny papers: A new report issued by the General Accounting Office concludes that a special unit set up by the FBI to warn against imminent electronic attacks by the bad guys is all too often a day late and a dollar short. I am shocked, shocked! Well, not to slam the FBI but here's a starter suggestion: Why not staff the unit with computer security professionals--hackers and crackers, the more the merrier--instead of regular FBI agents? (As luck would have it, Uncle Sam announced plans to set aside $8.6 million for scholarships to security students who agree to work in government posts after graduation.)
And so it happened that the Computer Emergency Response Team Coordination Center, the cybersecurity analogue of the Justice League of America, got hit by a denial-of-service attack, making it temporarily impossible for CERT to do its job--warning companies about computer security threats.
The wonderfully named 1394 Trade Association passed a milestone this week when it gave thumbs up to new specifications for FireWire, or IEEE 1394b. The takeaway here is that the speed of the connections between personal computers and peripherals will jump to up to 800 megabits per second from the 400 mbps of the current version of FireWire. But don't expect the first systems featuring the new standard until late this year.
Aimster CEO Johnny Deep has had better weeks, to be sure. First, an arbitration panel rules that AOL Time Warner should receive rights to the Aimster.com domain name. Then the front group for the recording industry at the RIAA fired off a lawsuit, charging Aimster with violating copyright in much the same way as Napster and Scour, the two previous targets of its attention. It's only a matter of time before the Motion Picture Association of America piles on with its own lawsuit.
Here's a sign of the times. Attrition.org, a volunteer site that tracks the defacement of Web pages, will no longer do so because its staff can't keep up with the ever-increasing load. Meanwhile, researchers at the University of California at San Diego report that more than 4,000 denial-of-service attacks get launched every week. Richard Egan, nominated earlier this year to be the next U.S. ambassador to Ireland, has filed along with his wife to sell 10.1 million shares of EMC, the storage company he co-founded. Based on the stock's current value, that's a bit more than $400 million, which will buy him and the missus a fair amount of Guinness.
Dell's President James Vanderslice declared a full-scale price war, which is hardly something investors wanted to hear. But that's the current coin of conventional wisdom these days in the PC market: Slash prices and bleed your rival white. Dell does have some $8 billion in the bank and has far more leeway than, say, an EMachines ever did to play this game. But for what purpose: Just to say you're No. 1? It does seem slightly nuts.
Kmart showed its gratitude to Mark Goldstein for rescuing Bluelight.com and making it the nation's second largest online site operated by a mass merchandise company by pushing him out the door. Now that the site is functioning just fine, what many of the weasels in corporate forget is how bad things were prior to Goldstein taking the reins, not the least of the challenges being that so many of their customers weren't even online.
The PC price war is getting really funky. I saw a Dell ad for a Pentium 4 machine with the works--17-inch color monitor, 1.3GB hard drive, 128K memory, and so on--and the system was selling for about $1,100. That's of a piece with earlier statements by senior Dell execs suggesting that they are ready, willing and able to go to the mattresses to win more market share.