TECH BRIEFS
Oracle Says Spending Remains Sluggish
Oracle Corp.'s chief financial officer, Jeff Henley, reiterated the software company's fiscal second-quarter forecast, pointing out that technology spending is still sluggish in the short term. Mr. Henley said the Redwood Shores, Calif., company expects revenue for the quarter ending Nov. 30 to be 4% to 7% below the year-earlier level of $2.36 billion. Oracle also expects to earn eight cents to nine cents a share, he said, down from 10 cents a share the previous year. Mr. Henley, speaking at the company's OracleWorld conference, said that macroeconomic data points to signs of a possible recovery next year but that visibility is still poor.
--The Wall Street Journal
Updated November 11, 2002 5:27 p.m. EST
Digex to Explore Possible Sale
Digex Inc.'s board formed a special committee to explore alternatives for the company, including a possible sale. The committee is made up of the three independent directors on the Laurel, Md., company's eight-member board. WorldCom Inc. owns a controlling stake in Digex and controls 94% of the voting rights of the provider of managed Web- and application-hosting services. In August, Digex said there was substantial doubt about the company's ability to continue as a going concern over the next 12 months because of the lack of certainty that WorldCom, which is operating under bankruptcy-court protection, can continue to fund Digex.
--Dow Jones Newswires
Updated November 11, 2002 3:09 p.m. EST
AT&T, Comcast Complete Debt Deal
AT&T Corp. and Comcast Corp. said Monday they completed a debt-exchange agreement, satisfying one of the last conditions of Comcast's planned acquisition of AT&T's broadband unit. Under the deal, AT&T Comcast will assume $11.8 billion of AT&T's debt. In December, AT&T agreed to sell its cable-television business to Comcast, based in King of Prussia, Pa., for about $45.7 billion in stock, plus the assumption of nearly $25 billion in debt and liabilities. The deal is expected to close in the fourth quarter.
--Dow Jones Newswires
Updated November 11, 2002 1:20 p.m. EST
VerticalNet Ponders Possible Sale
VerticalNet Inc. said it hired investment banker US Bancorp Piper Jaffray to pursue the potential sale of the company, according to its quarterly report filed Friday with the Securities and Exchange Commission. Officials at the supply-chain software company weren't immediately available to comment. VerticalNet, Malvern, Pa., said the economy has made it difficult for the company to get additional financing. The downturn has caused a tightening in corporate budgets, making businesses hesitant to take on expensive new software projects.
--Dow Jones Newswires
Updated November 11, 2002 4:32 p.m. EST
Verizon to Sell Stake in Investment
NEW YORK -- Verizon Communications Inc. said it is selling its 5.4% stake -- valued at about $280 million -- in England's Cable & Wireless PLC. Verizon spokesman Peter Thonis said the sale "is consistent with the strategy we have previously discussed." Chief Executive Ivan Seidenberg has said the company will likely divest itself of some nonstrategic investments overseas, many of which have lost value during the recent economic downturn.
--The Wall Street Journal
Updated November 11, 2002
WorldCom Units Seek Protection
1-800-Collect Inc., the calling service that has used Michael Jordan and Mr. T as pitchmen, joined parent WorldCom Inc. by filing for bankruptcy protection Friday, along with 42 other direct and indirect subsidiaries of the troubled telecom. Friday's filing -- which would put virtually all of WorldCom's domestic subsidiaries under bankruptcy protection -- may be a move to protect those units from creditors eyeing unprotected assets, telecommunications and bankruptcy experts said. WorldCom's initial bankruptcy filing in July -- the largest in U.S. history -- included its long-distance subsidiary, MCI Group, and a majority of its domestic subsidiaries. WorldCom Chief Financial Officer John Dubel said Friday's filing, which asks the court to add a total of 43 direct and indirect WorldCom subsidiaries into bankruptcy protection, was a formality. He noted that most, not including 1-800-Collect, are inactive. But Friday's filing also noted that 11 unsecured creditors of those 43 subsidiaries have petitioned the court for repayment of $1.64 million they are owed. WorldCom has acknowledged more than $9 billion in accounting irregularities and is negotiating with the Securities and Exchange Commission to settle fraud charges related to its accounting. It had racked up $41 billion in debt when it filed for bankruptcy protection July 21. (More on WorldCom)
--Associated Press
Updated November 8, 2002 9:11 p.m. EST
SonicBlue, TiVo Dismiss Lawsuits
SonicBlue Inc. and TiVo Inc. announced an agreement to drop patent infringement suits that they filed against each other last year, saying they will dismiss the claims "without prejudice." The suits between the rival digital-video recording companies were still pending in the District Court for the Northern District of California. In a joint statement late Friday, SonicBlue, based in Santa Clara, Calif., and TiVo of Alviso, Calif., said their energies were better spent expanding the market for digital-video recorders "rather than fighting each other."
--The Wall Street Journal Online
Updated November 11, 2002 10:54 a.m. EST
U.S. to Lose 3.3 Million IT Jobs
Analysts estimate that 3.3 million IT jobs will leave the U.S. to foreign countries by 2015, as companies find it cheaper and just as efficient to have a variety of IT work done offshore -- such as software programming done in India, China and Russia. Forrester, a Cambridge, Mass., technology-research firm, said that "a growing base of companies are shifting a range of IT, back office, customer service and sales operations offshore to cut their costs by upwards of 50%." The lost wages associated with those positions will go from $4 billion in 2000 to $136 billion in 2015, Forrester said in a new report. The huge cost savings are the motivation. "The cost of an entry-level programmer in China is 30% to 50% less than one in Tokyo, London, or Chicago," said Forrester. Low-cost bandwidth and a huge increase in capacity means that firms can ship huge volumes of scanned documents overseas cheaply, while standardized business software applications make it easier to hand work off to workers in other countries, Forrester said. For example, major software development firms such as Oracle Corp. and i2 Technologies Inc. have recently moved work to low-cost centers in India and the Philippines, the research firm said.
-- Dow Jones Newswires
Updated November 8, 2002 8:36 p.m. EST
AMD Plans Layoffs, Charge
Advanced Micro Devices Inc. plans "significant" layoffs and a fourth-quarter pretax charge of several hundred million dollars to achieve the cost savings it promised last month, but said it plans to be profitable in 2003. The chip maker will cut "a significant number" of people during the fourth and first quarters to help it get expenses in line, said Chief Executive Hector Ruiz, speaking at a meeting for analysts. He didn't give a specific count, saying he would first communicate the details of the layoffs to employees. An AMD spokesman later confirmed that the company would attempt to reduce its work force by 10% to 20% by the end of 2003, although he said the cuts would likely not all fall at once. AMD expects the cuts to generate a fourth-quarter charge of several hundred million dollars. Chief Financial Officer Robert J. Rivet said the company plans to be profitable for the full 2003 year after implementing previously announced plans to reduce expenses by $350 million.
--The Wall Street Journal
Updated November 8, 2002 9:11 a.m. EST
AT&T to Buy Velocita Assets
AT&T Corp. will pay $37 million for the assets of Velocita Corp., a Falls Church, Va., telecommunications company in Chapter 11 bankruptcy protection. AT&T was the only bidder at an auction held at U.S. Bankruptcy Court in Newark, N.J. AT&T will acquire Velocita's network of underground ducts, fiber-optic lines and other equipment used in telecommunications networks, paying creditors $2 million in cash and $35 million in AT&T stock. Velocita was once heavily backed by Cisco Systems Inc. of San Jose, Calif., which bought $200 million in Velocita preferred stock in May 2001. Cisco also provided $63 million in vendor financing to Velocita before it filed for bankruptcy protection in May. In its initial bankruptcy filing, Velocita said it had $483 million in assets and debts of $827 million. Velocita and AT&T have worked closely before. Velocita built its network along AT&T's right of way and laid cable for AT&T. It was run by Robert Annunziata, a former head of AT&T's Business Services.
--The Wall Street Journal
Updated November 8, 2002
FCC Sets Aside '3G' Airwaves
The Federal Communications Commission set aside airwaves for use by higher-speed wireless Internet services known as third-generation, or 3G, technology. The action follows a compromise reached last summer with the Department of Defense, which relinquished some of its valuable spectrum for private use. The FCC also began drafting rules for using the spectrum, which will be available in 2004, and for selling it in an auction. The 3G service could include providing location services, Internet browsing, and personal-data services via mobile phones or other devices.
--Dow Jones Newswires
Updated November 7, 2002 3:16 p.m. EST |
