In light of a slumping stock market, Omaha-based Ameritrade Holding Corp. announced that it will lay off about seven per cent of its workforce. At the same time, it disclosed that the CEO of its on-line stock trading arm, Ameritrade Inc., resigned in March.
In a statement, the parent company of the on-line trading brokerage said it would streamline operations by eliminating about 170 customer service positions in the coming weeks, mostly at call centres in Omaha and in Fort Worth, Tex., because “during the past few months, we have faced increasingly adverse market conditions.” A company spokesperson confirmed that Ameritrade Inc. CEO Jack McDonnell had resigned recently. He would not elaborate but said a statement would be forthcoming.
Employees taking a pay cut
Agilent Technologies Inc. announced its latest and most aggressive expense reduction measure to date in response to recent dramatic slowing in customer demand. The company will temporarily reduce employee pay by 10 per cent. Agilent Technologies Canada Inc., headquartered in Mississauga, Ont., is a subsidiary of Agilent Technologies Inc.
Agilent began slowing hiring and reducing discretionary spending several months ago. As the demand from Agilent’s major customers has dropped dramatically in the last two months, the company has taken progressively more aggressive expense control actions. “We’re trying to avoid across-the-board layoffs in response to cyclical market conditions,” said Ned Barnholt, Agilent president and CEO. “We view the economic slowdown as a business cycle – even though it’s deepening and broadening. At the present time, we believe this pay reduction is the most appropriate action for us.”
Study: fraud is solvable
A new study of Internet retailers, or e-tailers, released by The Worldwide E-Commerce Fraud Prevention Network found that while nearly half of e-tailers surveyed say on-line fraud is a “significant problem,” the majority believe that fraud prevention steps can minimize risk.
The survey, which was conducted over the week of March 5 on the Network’s Web site, found that 50 per cent of those surveyed reported on-line losses from fraud of between US$1,000 and US$10,000. Nineteen per cent said they had lost more than US$100,000. Of more than 1,000 members of the Network, 140 took part in the survey. The largest number of respondents thought fraud was a “somewhat significant” problem (36 per cent), while only 10 per cent found it to be the “most significant problem” and one per cent said they never worry about it at all.
SAS Canada, IBM Canada team up
SAS, an e-intelligence and decision support software provider, and IBM recently announced a joint offering of e-business intelligence solutions that will help Canadian customers leverage corporate data to make better and more strategic business decisions, the two said in a statement. “With this agreement, SAS will tap into IBM’s sizable market share and empower mutual customers to better understand their organizations, customers and suppliers,” noted Eric Yau, general manager of SAS Canada. This deal expands on a similar agreement between the two companies that was signed in early 2000 and covered the United States, and is the latest example of a long history of IBM and SAS working together.
Universal Music acquires Emusic
Universal Music Group Inc. confirmed recently that it will acquire on-line music company EMusic.com Inc. for an estimated US$24.6 million.
Universal Music Group, which is owned by Vivendi Universal SA, will pay cash for all of EMusic’s 43.2 million shares of stock priced at US$0.57 a share, the companies said in a statement. Vivendi is partnering with Sony Music Entertainment Inc. in an on-line music venture called Duet, which will offer subscription-based digital downloads and streams. The Washington Post recently quoted an unnamed source saying that EMusic would become a distribution site for Duet music. EMusic acknowledged that it had agreed to be acquired. Grace Salafia, a spokesperson for Universal Music Group, told IDG News Service that The Washington Post report about how EMusic will be incorporated is “speculation” and said it is “premature” to comment on plans for EMusic.
Report: Marconi to cut jobs
U.K. telecommunications equipment maker Marconi PLC is to slash 3,000 jobs, around 6 per cent of its workforce, and issue an earnings warning, according to a recent report in the Financial Times.
Staff were sent letters outlining the layoffs, and the cuts will take place over the next 12 months, the newspaper reported. In the longer term, however, there will be a net increase in staff as the company grows, according to the report. Marconi declined to comment. The company manufactures hardware for the telecommunications industry and employs about 49,000 people worldwide.
Lucent takes some more heat
No one can argue that Lucent Technologies Inc. is up against the ropes. While the rest of the networking industry was enjoying healthy growth for most of last year, Lucent was floundering, dealing with disappointing sales and earnings and issuing warning upon warning.
CEO Rich McGinn left the company as a result. Now rumours have surfaced that Lucent is headed for bankruptcy, which sent its shares spiralling downward. Lucent has vehemently denied the rumours in a statement released to squelch the ensuing panic. Some analysts have also expressed doubt that Lucent would go to such drastic lengths as declaring bankruptcy. Indeed, it seems highly unlikely that Verizon would place a US$5.6 billion order for wireless infrastructure with Lucent if the company was going down, industry watchers have noted.
Vendor e-com sites fail to fire
Service is king in New Zealand – that’s the verdict after single-seller vendor Web sites there have so far failed to fire despite all the major IT vendors in the U.S. and Australia launching into direct Web sales to end users.
Direct Web business so far commands less than one per cent of sales in New Zealand, much to the joy of resellers. Instead, resellers, systems integrators and service-orientated companies such as Axon are finding by offering both sales and after-sales service their Web sites are thriving. Vendors such as Compaq Computer Corp., which has avoided launching a New Zealand site, despite Compaq Worldwide taking that approach, admits this outcome was expected. New Zealand is being called an anomaly, even compared to Australia. “The relationship with the channel here is much stronger than anywhere else in the world,” said Compaq’s XS business group manager Andrew Seerden.
Hackers hit airline’s site
A computer hacker attacked Singapore Airlines Web site recently, halting on-line ticket sales.
The Web site’s main page was replaced with an angry message directed at Microsoft and expressing support for Linux, according to the Australian Associated Press. Singapore Airlines vice-president of public affairs Rick Clements said the airline is investigating the incident. Singapore imposes harsh penalties on hackers including jail terms for breaking into computer systems or defacing Web sites.
3Com improves NIC security features
3Com Corp. will announce a new firmware add-on for its network interface cards that could be used to lock down servers and PCs to prevent hacks from outside or inside a company.
The network firm says the new NICs let network professionals secure networked PCs and servers by controlling exactly what can be done from a client PC or who can access certain servers. 3Com says the NICs can boost the speed of nodes that send encrypted data by off-loading encryption algorithms and other packet processing tasks from a PC’s processor to the NIC. A firewall enhancement will also be available on 3Com’s 3CR990 10/100Mbps NIC with the on-board 3X RISC processor. The firewall technology will reside on the NICs as firmware. 3Com developed the product with security software firm Secure Computing Corp.
Firms to take financial fall
While some customers may like the idea of using content delivery networks as strategic data delivery systems, the support isn’t exactly filling the coffers of two of the technology’s rivals. Inktomi Corp. said it expects to report second-quarter revenue of US$36 million to US$38 million, and a loss of about US25 cents per share – compared to analyst estimates of US$65 million in revenue and a US4-cent loss. The firm also said it will reduce its workforce by 250 people, or about 20 per cent.
Akamai Technologies Inc. then announced similar money troubles, saying its first-quarter revenue is expected to come in between US$39 million and US$41 million, rather than the projected US$45 million. The company also plans to lay off about 200 workers, or 14 per cent of its workforce. Both companies build technology that speeds the delivery of Web pages by storing it in caches closer to customers. Akamai offers a subscription-based service aimed at content providers, while Inktomi sells primarily to carriers, telephone companies and service providers.
Software pirates jailed
A gang of software counterfeiters were recently given jail sentences at London’s Old Bailey.
The gang specialized in trading illegal copies of Microsoft Corp. software worth millions of pounds. Passing custodial sentences, Judge Pearlman said the gang had been involved in a “careful and sophisticated fraud that struck at the route of commercial trust and probity.” Three members of the gang were jailed for a combined total of 10 years. Judge Pearlman said the sentences reflected the seriousness of the offence and the amount of money companies lost through such fraudulent activity. “We hope these sentences will help raise awareness of the massive problem counterfeiting represents to customers, industry and the economy,” said Julia Phillips, anti-piracy manager for Microsoft.
NBC to buy back NBCi
Reversing its course, General Electric Co., which owns the National Broadcasting Co., is purchasing the outstanding assets of the portal NBC Internet Inc. (NBCi) for an estimated US$138 million.
Before the deal, NBC owned about 38.6 per cent of the company. The rumour had been circulating for months on both coasts about a potential exit strategy for the last remaining publicly-traded portal founded by a broadcast network. Observers and former employees believed that the NBC network would delay such a move until at least the fourth quarter. It remains unclear exactly what NBC’s plans are for NBCi’s assets. NBCi CEO Will Lansing is expected to step down from his position after the deal closes. Layoffs are expected, but it remains unclear exactly how many employees will remain. NBCi was founded in 1999 as a joint venture with the direct-marketing company Xoom.com and CNET’s portal Snap.com. It operated as Snap.com until last fall, when it was renamed NBCi. “Today’s declining market conditions in the Internet space have made it difficult for NBCi to remain competitive,” Lansing said in a statement. “This was a hard decision, but in the end we have determined that this course of action is best for the company’s public stockholders.”
Cisco aims to simplify VPN management
Cisco Systems Inc. has announced a single client for its three lines of VPN gear, a move that could ultimately simplify the management of Cisco virtual nets.
However, the new Cisco VPN Client 3.0 won’t actually support all three lines of VPN gear until next year. Currently, each type of Cisco VPN gear requires separate client technology, the result of the company building its VPN line in stages, partly through acquisitions. The new unified client will work initially with Cisco’s 3000 Series VPN concentrators, and later, through software upgrades, with Cisco 7100/7200 VPN routers, Cisco 5000 Concentrators and Cisco PIX firewalls. Despite the delay, the new client brings immediate benefits, said Emmett Hawkins, CTO of Vortex Networks, a WAN service provider in Atlanta that beta-tested the client. For instance, the client makes it easier to screen remote users via Microsoft’s Active Directory. Previously, a Remote Authentication Dial-In User Service server or Lightweight Directory Access Protocol directory needed to sit between a VPN concentrator and Active Directory, and that required maintaining more databases and sapped staff resources, he said.