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Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: Chetman who wrote (36563)	1/14/2000 7:10:00 PM
From: johnd	Respond to of 74651

Insurer bets on 32-processor Intel server & Windows 2000 By Jaikumar Vijayan 01/14/2000 Penn National Insurance is the first U.S. customer to bet on Blue Bell, Pa.-based Unisys Corp.'s new 32-processor Intel Corp. server. The server will run Windows 2000 Data Center Edition, the companies said this week. During the next 24 months, the insurer will use the mainframe-like ES7000 Intel server to consolidate applications currently running on more than 60 servers, said Tom Miele, director of infrastructure at Penn National in Harrisburg, Pa. Penn National's current collection of servers includes Hewlett-Packard Co. Unix servers, Compaq Computer Corp. Windows NT servers and IBM mainframes. The consolidation project is part of an effort to enhance the company's electronic-business capabilities. The company will also roll out two new applications: a Web-based claims processing application for 1,200 independent agents and a policy administration system. Penn National will take delivery of the Unisys ES7000 in June and then migrate applications in two stages. Many of the core applications scheduled to run under Windows 2000 on the new server will be tested on smaller four-way and eight-way systems before being put on the ES7000. "We are taking a very cautious approach. . . . It is going to be some time before we put any production applications on Windows 2000," Miele said. Penn National is an early example of a company trying to curb server proliferation by taking advantage of scalable, relatively inexpensive Intel servers and the central management capabilities promised by Windows 2000. "Server consolidation is going to be a big story," said Joseph Ferlazzon, an analyst at Technology Business Research Inc. in Hampton, N.H. The Unisys ES7000 -- priced from $150,000 to more than $700,000 -- can be partitioned into six smaller servers, allowing users to consolidate multiple applications within one box.

To: Chetman who wrote (36563)	1/14/2000 8:10:00 PM
From: taxman	Read Replies (1) \| Respond to of 74651

Redmond, Washington, Jan. 14 (Bloomberg) -- Microsoft Corp., the world's largest software maker, will report higher fiscal second-quarter earnings on Tuesday as sales of personal computers boosted demand for its software, analysts said. Microsoft is expected to report that its earnings for the period ended Dec. 31 rose to 42 cents a share from a split- adjusted 36 cents a year ago, according to analysts polled by First Call/Thomson Financial. Revenue rose to $6.2 billion from $5.2 billion, analysts forecast. The company has beaten earnings forecasts for the past eight quarters, and unofficial ``whisper' estimates run as high as 47 cents a share. Microsoft benefited from strong sales of personal computers during the holiday season, boosting sales of its Windows operating system and application programs such as its Office products, analysts said. Microsoft's Windows software runs on more than 90 percent of PCs sold in the U.S. today. ``It's been a good quarter,' said Michael Kwatinetz, a Credit Suisse First Boston Inc. analyst with a ``strong buy' rating on Microsoft. ``The PC market has been on fire.' Microsoft shares today rose 4 7/16, or 4.1 percent, to 112 1/4 in trading of almost 36.7 million shares, making it the fifth- most active U.S. stock. Microsoft's earnings are expected to continue to grow this quarter and for the rest of the year, analysts said, as the company ships its long-awaited Windows 2000 operating system. The company's most ambitious product upgrade, the new software for businesses will go on sale Feb. 17. Changes at Top Microsoft's earnings report will come less than a week after the company announced that co-founder and Chief Executive Bill Gates, the man who came to epitomize both Microsoft's growth and the overall rise of the software industry, will step down from day- to-day management of the company to focus on the development of new technology. Microsoft President Steve Ballmer was named chief executive. Gates will remain chairman and take on a new title of chief software architect, saying he wants to help guide the company's next generation of Internet-based software. The announcement had little effect on the company's stock. Ballmer was named president in a management reorganization in July 1998, and he's effectively been leading most day-to-day management of the company since then, analysts said. ``We see no operational impact on Microsoft as a result of this management change,' Merrill Lynch & Co. analyst Chris Shilakes, who has a ``near-term accumulate' rating on Microsoft, wrote to clients today. ``Ballmer has been heavily involved in daily Microsoft operations for years, and Gates' recent focus has been in reshaping Microsoft to address the Internet opportunity.' Windows, Office Microsoft benefited last quarter from strong holiday sales of its Windows operating system, its best-selling software and a product that accounts for about 40 percent of Microsoft's quarterly revenue. The company is expected to report that it generated about $2.6 billion from sales of its Windows products, analysts estimated. The fourth quarter is generally one of the best for personal computer hardware and software makers, as consumers increase their purchases during the holidays and companies boost spending at year- end. Windows is sold primarily through computer makers such as International Business Machines Corp., Dell Computer Corp. and Gateway Corp., preloaded on computers that are then sold directly to consumers or through retail stores. Microsoft's Chief Financial Officer last quarter, Greg Maffei, said in October that the company's earnings would be 3 cents a share above estimates at the time because of strong holiday and year-end corporate spending. Maffei last month resigned to head a Canadian telecommunications company. Microsoft also is expected to benefit from sales of its Office package of software applications, which include word processing and spreadsheet programs. ``The strongest areas are the Office products,' Kwatinetz said. ``This will be a very strong quarter for Office.' Antitrust Case Investors are largely ignoring for now the threat to Microsoft from the antitrust suit filed against the software giant in 1998 by the U.S. Department of Justice and 19 states. Microsoft shares languished for much of last November following a ruling by the judge in the case that found that Microsoft had a monopoly in the personal computer operating system business, and that it used the monopoly to gain a competitive advantage in other markets, in the process harming consumers and competitors. That ruling by U.S. District Judge Thomas Penfield Jackson, an initial finding that supported much of the government's case, set the stage for settlement negotiations that are continuing. Even after reports this week that government antitrust enforcers will seek to break up Microsoft into competing companies, analysts and Microsoft executives said the company will not settle the case on terms harmful to investors. That could leave the case in the appeals courts for several years. ``I think it'd be absolutely reckless and irresponsible for anyone to try and break up this company,' Ballmer said yesterday. ``I think it'd be the single biggest disservice anyone could do to consumers in this country.' That apparent impasse has led investors to discount the threat of the case, at least for now. Microsoft shares have risen more than 22 percent since Judge Jackson's ruling, surpassing the 7 percent gain in the Standard & Poor's 500-stock index during the same period. ¸2000 Bloomberg L.P. regards