Author: Nick Farrell

Microsoft sues the US taxman

MSlogoSoftware giant Microsoft has sued the US taxman as part of a move to find out about a law firm hired by US tax authorities in a review of how the software company books sales between subsidiaries.

Vole claims the IRS entered into a contract this year with Quinn Emanuel Urquhart & Sullivan, which specialises in litigation. The agency is paying Quinn Emanuel more than $2 million in connection with its examination of Microsoft tax returns between 2004 and 2009, the court filing said.

Microsoft wanted more information, but the IRS had not fulfilled a Freedom of Information request seeking the complete Quinn Emanuel contract and other documents.

“Government agencies, funded by citizens, have an obligation of transparency under the Freedom of Information Act,” Microsoft said in a statement.

At issue are how multinational corporations value goods and services moving across international borders from one of their units to another. These cash transfers frequently reduce a corporation’s global tax costs.

The IRS has scrutinised technology companies, including Microsoft and Amazon over how they account for such transfer pricing and it appeared to using Quinn Emanuel.

That outfit represented the Federal Housing Finance Agency in high-profile lawsuits against financial institutions, including Goldman Sachs Group over the quality of mortgage-backed securities they sold before the financial crash.

It seems a little odd that Microsoft, instead of being concerned about a potential IRS investigation is going to court to find out who the taxman is hiring as his lawyers.


Intel shares could rise by 30 percent

hopeWhile some have decided that Intel will go the way of the Dodo, it appears that the analysts Barrons disagree.

The outfit’s augury division has walked a compliant white bull into the temple of Juno, read its steaming entrails, and concluded that Intel will do rather well.

It thinks that shares in Chipzilla will rise more than 30 percent to $48 over the next two years.

The logic is that with shares its recently at over $35, Intel stock is halfway to the five-year doubling Barron’s said it predicted in June of 2013.

Barron’s said that in two years’ time, the 30 percent rise would put shares trading at around 16 times future earnings estimates, the same price to 2014 earnings ratio that it now trades at.

Intel has few fans among the cocaine nose jobs of Wall Street, suggesting plenty of popularity to be gained. Intel is strategically running a deep loss in its mobile-chip division in order to make up for its late start.

However, Barron insists that might be a good thing. Shrinking those losses to break-even in future years will uncover earnings power in the rest of the company that is currently hidden.

However there is a lot of scepticism about Intel—just 40 percent of analysts who cover the shares say to buy them.

Earnings per share are expected to climb 19 percent this year to $2.25, which looks like excellent growth, except that earnings first topped $2 a share back in 2010, said a Barron.

However Barrons did not see everything as lilly white in the ox’s liver.  It thinks that while Intel is on track to ship a promised 40 million tablet chips this year, versus just a million or so two years ago, its mobile division will likely lose about $4 billion in the process. That is partly due to “contra revenues,” which are effectively rebates to spur demand while Intel closes the cost gap to rivals on low-end multifunction chips.

Next year Intel expects the division’s loss to shrink by only $800 million. However, by then, it expects to sell a full range of tablet chips, ranging from cheap models called SoFIA, which have integrated wireless function, to pricier Cherry Trail chips for zippy performance at low power. Analysts see the mobile unit achieving positive gross profit margins by 2016.

So if you are thinking about making a quick buck from Intel you might want to wait until this period is over before investing your nest-egg.



Copyright troll used robo-harassment

trollCopyright troll Rightscorp is being dragged from under its bridge to face the music in court for harassing victims with illegal harassing robo-calls.

Morgan Pietz, one of the lawyers who wrapped “copyright troll” Prenda Law in judicial red tape is targeting Rightscorp saying the outfit made illegal, harassing robo-calls to his clients, who were accused of illegal downloading. The lawsuit says that Rightscorp broke the Telephone Consumer Protection Act (TCPA), a 1991 law which limits how automated calling devices can be used.

Under the suit, Pietz claims that Rghtscorp was a “debt collector” but made harassing phone calls and didn’t abide by federal or California debt collection laws. Rightscorp company managers, including CEO Christopher Sabec and COO Robert Steele, and Rightscorp’s clients are all named as defendants in the lawsuit.

Violations of federal debt collection laws can result in damages of $1,000 and include provisions for paying lawyers’ fees in successful cases.  TCPA violations can cost $500 per incident, and that can be tripled if the violations were wilful.

Pietz says he doesn’t know how many violations have occurred. But he says just one of his named plaintiffs was subject to enough illegal phone calls to add up to tens of thousands of dollars in damages.

One victim, Jeanie Reif,  had her mobile phone called every day for a couple of months, Pietz said. And there could be thousands of members of this class.

If a judge agrees with Pietz that the phone calls were harassing and illegal, Rightscorp could be on the hook for many millions of dollars and that could send it under. The company has lost $6.5 million since its inception in 2011.

If it goes under the enforcement company’s marquee music clients, who include BMG Rights Management and Warner Brothers could end up having to pay up.

Infosys forced Apple to pay more for less

8eea64e0563590b07a4d93537eb2851fSome top Infosys executives have cleaned out their desks and been escorted from the building after it was discovered that the outfit had been daring to overcharge the margin king Apple.

Infosys, India’s second-largest IT services exporter, said on Tuesday it had fired Abraham Mathews, chief financial officer of its Infosys BPO unit, for failure to comply with the company’s code of conduct.

Infosys BPO chief executive officer Gautam Thakkar resigned on “moral grounds” and would leave the company on November 30, Infosys said. It did not give details about the charges against Mathews.

“The financial irregularities are not material in nature and the company has already made required disclosures. The company has taken disciplinary action on employees,” the company said. The irregularities in Infosys BPO’s dealings with Apple came out during an internal audit.

Though the audit showed that the financial impact of the wrongdoing on the company was minimal, Infosys decided to take a tough stance to demonstrate its “zero-tolerance policy for any improper conduct,” he said.

Reports from India suggest that six more people will be fired soon after investigations revealed that they had produced inflated invoices and allegedly overbilled Apple for many months.

The thought of Apple being overcharged for a service that actually cost a lot less, strikes us as a little ironic and would be confirmation of the doctrine of karma, if we believed in that sort of thing.

Infosys earlier this year brought in Vishal Sikka as its new CEO to chart a new strategy for the company, once a trendsetter for India’s more than $100 billion IT outsourcing industry. Infosys has struggled in recent years to retain staff and market share, the fact it has to fire a few cannot help things.

Bricks and Mortar turned over by Amazon scam

supreme_court_backs_walmart_over_closedstore.jpeg.size.xxlarge.letterboxBricks and Mortar outfits in the US have been warned against competing against online retailers, after a fraud emerged which cost Walmart thousands.

Walmart had been running a deal, where it promised to match any price found online.

However some customers worked out that the only thing they needed to show Walmart was an Amazon advert.

All they did was register an account which created an official looking Amazon page with a bogus advert on it.

Few Walmart employees appear to have verified the legitimacy of these online deals and many customers were able to buy PS4 gaming systems for $90.

Walmart should have known better. Consumerist found that Sears accidentally listed several Nintendo consoles on its site for $60. Members of Twitter and Reddit communities posted pictures of receipts documenting that Wal-Mart had accepted these fake Amazon listings.

Intel has a perky bottom line

Intel-logoIntel’s bottom line is looking a little cheery thanks to the fact that the death of the PC was overstated and people are buying them again.

Intel said that its revenue outlook for 2015 was above what the cocaine nose jobs of Wall Street expected and it was even going to raise its dividend.

Intel claimed that its revenue will grow by a mid-single digit percentage next year which is not what we usually associate with a middle digit.

Analysts on average have been forecasting 3.4 percent revenue growth for 2015.

Chairman Andy Bryant said he saw progress in Intel’s strategy of staking out a big chunk of market share in tablets this year by offering manufacturers subsidies to use its chips.

“I’m not going to tell you I’m proud of losing the kind of money we’re losing but I’m also going to tell you I’m not embarrassed by it like I was a year ago about where we were,” Bryant said. “This is the price you pay for sitting on the sidelines for a number of years and then fighting your way back into the market.”

Intel expects gross margins in 2015 to be 62 percent, plus or minus two percentage points. Analysts on average expected 63 percent gross margins for 2015 and 2014.

Capital spending next year will be about $10.5 billion, the company said, compared to about $11 billion expected in 2014.

Intel also said it would increase its dividend by six cents to 96 cents on an annual basis.

Intel’s results point to the death of the industry myth, put about by the Tame Apple Press that the iPad had killed the PC and everything was going mobile. We said that mobile was a parallel development and that PC sales slumped due to a downturn in the economy coupled with the fact that PCs were lasting longer and there was no need to upgrade.

CEO Brian Krzanich said Intel was on track to exceed its goal of seeing its chips used in 40 million tablets this year. That strategy made Intel the No 2 tablet chip supplier in the June quarter, according to market research firm Strategy Analytics, but it cost the company billions of dollars in subsidies.


Intel to release thumb-sized PCs

thumbs downChipzilla has said that it is shrinking PCs to thumb-sized “compute sticks” that will be out next year.

The stick will plug into the back of a smart TV or monitor “and bring it intelligence to that,” claimed senior vice president and general manager of the PC Client Group Kirk Skaugen.

A device the size of a USB stick was shown on stage, but its capabilities were not demonstrated, so we will have to take Intel’s word that it was not a thumb drive Skaugen picked up and waved around before the press conference.

Although, to be fair, the technology is already in the marketplace. Skaugen likened the compute stick to similar thumb PCs offered by PC makers with the Android OS and ARM processor.

Dell’s $129.99 Wyse Cloud Connect, plugs into an HDMI port, can turn a screen or display into a PC, gaming machine or streaming media player.

Skaugen claimed the devices will be an extension to laptops and mini-desktops, which have Core desktop processors in small PCs that can be handheld.

Normally these thumb sized PCs do not have internal storage, but can be used to access files and services in the cloud. The Wyse Cloud Connect has wi-fi and Bluetooth.

Skaugen thinks that the market for such devices is in the tens of millions of units,. The compute stick will bring x86 computing to fanless designs.

Intel makes low-power Atom processors for mobile devices, which could fit into thumb-sized PCs.


Lollipop causes headaches for old Nexus users

kojakThe Tame Apple Press is rubbing its hands with glee that Google’s latest OS, Lollipop, appears to break old versions of its  flagship Nexus tablet.

The BBC , which is a big fan of Apple gear, seems to have spun the story as if the bug broke all Android machines, when actually the OS has positive reviews.

“Early adopters of Google’s latest Android operating system are warning others of problems with the software, “thundered Auntie only to admit in the next paragraph the bugs only affected Nexus 7 users. The Nexus 7 came out in 2012.

There is no doubt that there is something wrong with Lollipop and its reaction to some of the gear under the bonnet of an Ancient Nexus 7, but frankly, it is amazing it upgraded at all.

The BBC hints that more problems have not arisen because the OS is only available to a limited number of machines, because many network operators and device manufacturers have yet to complete their own tests.

Ironically, the OS was supposed to revamps the system’s user interface, offers greater control over notifications, and makes changes to the way the OS executes code, which Google said should mean fewer “temporary glitches” than before.

Android Lollipop adapts its look to suit smartwatches, smartphones and tablets

Nvidia, LG and Motorola have also released Android Lollipop updates for some of their handsets and tablets.

The work around for Nexus 7 users is to turn off Google Now, change transitions to zero and limit it to two background apps maximum.

Several Android Lollipop users have also highlighted compatibility problems with Air-based apps.

Apple said sorry  in September after faults with iOS 8 caused some of its new iPhones to be unable to make and receive calls, which was supposed to be the phone’s main job.

Creditors fume at Apple and GT deal

Bank-imageCreditors of GT Advanced Technologies are fuming that the outfit got too little in its proposed settlement with Apple over legal claims stemming from a deal to supply sapphire screens.

GT Advanced shocked investors by filing for bankruptcy in October in a case that was initially shrouded in secrecy due to confidentiality agreements with Apple. GT Advanced’s chief operating officer has said in court papers that the iPhone maker pulled a “bait and switch” to force the sapphire maker into a money-losing deal in 2013.

Apple agreed to release GT Advanced from the deal and allow it to sell more than 2,000 sapphire furnaces located in Mesa, Arizona.

The agreement needs approval by US Bankruptcy Court Judge Henry Boroff, who has been hearing the Chapter 11 bankruptcy case in Springfield, Massachusetts. He is not too happy about things dot com.

But holders of GT Advanced’s notes, including Aristeia Capital and an affiliate of Wolverine Asset Management, said in court papers the “extraordinary allegations against Apple … call into question the adequacy of the settlement agreement.”

The concept that Apple breached its contract and acted unfairly as GT Advanced’s lender and the fact that Apple’s claims on GT Advanced’s equipment were unsecured would put Jobs’ Mob among the last creditors to be paid, not the first as Apple claimed.

Apple has denied GT Advanced’s allegations. In court filings, Apple has called the accusations “scandalous and defamatory” and “intended to vilify Apple and portray Apple as a coercive bully.”

However, the noteholders want access to internal records and documents from Apple and GT Advanced to investigate if the settlement lets Apple off too cheaply. The noteholders asked Boroff to postpone the settlement hearing, currently scheduled for Nov. 25, to give them time to complete their investigation.

GT Advanced said it is negotiating with potential buyers for its sapphire furnaces and said in court papers an extended delay in approving the Apple settlement could hurt its ability to reorganise and repay its creditors.

Hon Hai ties up with Innolux

Hon-HaiHon Hai Precision Industry has tied up with flat panel maker Innolux and is investing $2.8 billion in a panel producing plant in Taiwan.

Hon Hai is desperately trying to find new revenue streams which do not depend on the fruity themed cargo cult, Apple.  Earlier this year it bought stakes in a Taiwanese mobile network provider and a South Korean IT services provider.

Under the plan, the pair will buy equipment for the facility located in the southern city of Kaohsiung and which is expected to start production in the second half of 2016.

The plant, which will make low-temperature polysilicon panels, predominantly for use in smartphones, was built in 2008, but was mothballed due to financial constraints after the 2008 global financial crisis.

The plans are still awaiting final approval from the boards of both companies, but it seems likely that Hon Hai will stump up for the majority of the cash. The Innolux representative said the investment may take the form of a new joint-venture company.

Hon Hai already holds a nine percent stake in Innolux though its various subsidiaries. It is all a little mysterious dot com.


China firewalls the cloud

great wallChina has expanded its Great Firewall of China to include a major hosting and cloud services company.

According to internet freedom watchdog, the EdgeCast content delivery network (CDN), which “provides cloud services to thousands of websites and apps in China”, has been partially blocked.

A number of major international companies have been affected by the block, including The Atlantic, Sony Mobile, and websites related to the Firefox web browser.

Filtering escalated this week with an increasing number of popular web properties impacted and even many domains being partially blocked.

The blocking of a major CDN such as EdgeCast marks a significant escalation in the efforts of Chinese censors to keep the country’s internet free of unwanted outside influence.

Charlie Smith, founder of GreatFire, told the South China Morning Post that taking down so many sites in one go will have a huge economic impact – online commerce, trade, even academia will all be affected by this.

“While the economic cost is huge, the authorities are also risking upsetting Chinese netizens who suddenly wake up to find out that they cannot access a plethora of websites.”

The problem, as far as China is concerned, is that free speech activists and anti-censorship groups such as GreatFire have been using cloud services to create mirrors of sensitive information which cannot be blocked.

This included the International Consortium of Investigative Journalists (ICIJ) report on the use of offshore tax havens by Chinese businessmen and officials. The report was uploaded to Amazon’s cloud servers, which, because of their design and encryption, are impossible to block on an individual website or page basis.

However killing off the entire cloud domain would cause significant harm to the businesses of the thousands of Chinese websites, including major corporations, who  depend on its services for database management and other cloud computing.

GreatFire said in a blog post since the Great Firewall cannot distinguish traffic to our mirror sites and other traffic to the cloud provider which means they cannot block access to its mirror sites without blocking access to all the sites hosted by the CDN.

It sees this as a form of ‘collateral freedom’ which hinges on the gamble that the Chinese authorities will not block access to global CDNs because they understand the value of China being integrated with the global internet.

It looks like the authorities do not care and are just going to cut China off from the global internet, rather than letting that work around happen.

Ironically, China hosted the World Internet Conference in Zhejiang province. Talks include “An interconnected world shared and governed by all” and “Cross-border e-commerce and economic globalisation.”

Intel’s Knight’s Hill cut down to 10nm

intel_log_reversedIntel is telling the world+dog that it talks to that its third-generation Xeon Phi, codenamed Knight’s Hill, will use 10nm technology and its second iteration of Omni-Path fabric. TechEye and ChannelEye are not in Intel’s good books again, so we have to sneak under the radar.

Intel is not talking to us any more. Sniff.

Knight’s Hill is a long way from being in the shops. We still have to see the 14nm Knight’s Landing which is not going to be in the shops until summer of 2015. This could mean that Knights Hill is likely for 2017.

Knight’s Landing will use the same Silvermont architecture that powers Intel’s Bay Trail but it will  support four threads per CPU — currently Silvermont doesn’t use hyper-threading marchitecture at all.

The reason we are interested in Knight’s Hill is that information on it is about as rare as a 1970s TV star who has not been investigated by operation YewTree, and we wonder why Intel is talking about it at all.

Perhaps it might because Intel is attempting to reassure customers that there’s a roadmap stretching out beyond the Knight’s Landing product and the 14nm node.

Intel’s Omni-Path scaling architecture debuts next year. Omni-Path is Intel’s next-generation networking interconnect that handles up to 100Gbps of bandwidth and uses silicon photonics technology for signalling. The new standard offers up to 48 ports per switch compared to 36 ports on other top-end standards, and is designed to lower the cost of huge build-outs by reducing the total number of switches. The long  term goal is to reduce latency and allow for effective scaling as the industry pushes forwards towards exascale. Bring back Pat Gelsinger!

Future versions of the core will likely expand both the onboard memory pool (16GB is expected for Knight’s Landing; Knight’s Hill could pack 32GB or more), add additional bandwidth, and likely increase the interconnect performance between the CPU and the associated MIC.

According to Extreme Tech  Intel might push its AVX standard up as high as 1024-bit registers, if the HPC crowd wants it. Adding wider registers is a simple way to boost performance The current AVX specification allows for extensions of up to 1024 bits in length, however, so Intel could do this. [Does anybody apart from Extreme Tech believe this Intel crap any more? Ed.]


Android Trojan could be bane of corporations

hitchhikers_guide_marvinOne of the longest running multipurpose mobile botnets has been updated to become stealthier and more resilient and it could be a major headache for businesses.

Dubbed NotCompatible, the botnet is mainly used for instant message spam and rogue ticket purchases, but it could be used to launch targeted attacks against corporate networks because the malware allows attackers to use the infected devices as proxies.

Researchers from security firm Lookout said that the mobile Trojan was discovered in 2012 and was the first Android malware to be distributed as a drive-by download from compromised websites.

Devices visiting such sites would automatically start downloading a malicious Android application package file. Users would then see notifications about the finished downloads and would click on them, prompting the malicious application to install if their devices had the “unknown sources” setting enabled.

A newly found version of the Trojan program, called NotCompatible.C, encrypts its communications with the C&C servers, making the traffic indistinguishable from legitimate SSL, SSH or VPN traffic.

Lookout security researchers wrote in their bog that the malware can also communicate with other infected devices directly, forming a peer-to-peer network that offers powerful redundancy in case the main C&C servers are shut down.

The Lookout researchers believe that the botnet is likely rented to other cybercriminals for different activities and the Trojan’s proxy capability makes it a potential threat to corporates.

If a device infected with NotCompatible.C is brought into an organisation, it could give the botnet’s operators access to that organisation’s network, the Lookout researchers said.

“Using the NotCompatible proxy, an attacker could potentially do anything from enumerating vulnerable hosts inside the network, to exploiting vulnerabilities and search for exposed data.”

“We believe that NotCompatible is already present on many corporate networks because we have observed, via Lookout’s user base, hundreds of corporate networks with devices that have encountered NotCompatible,” the Lookout researchers said.

Ah, the unternet of thangs ain’t what they used to be.


Samsung cannot stop Microsoft

microsoft-in-chinaA US judge has rejected Samsung bid to put Microsoft’s smartphone patent royalties case on hold while the South Korean company pursues arbitration in Hong Kong.

New York Judge Jed Rakoff said the lawsuit would proceed despite the arbitration.

Microsoft sued Samsung in August, claiming it broke a collaboration agreement by refusing to make royalty payments after the US company announced its intention to buy Nokia’s handset business in September 2013.

The lawsuit claimed Samsung owed $6.9 million in interest on more than $1 billion in patent royalties it delayed paying. Samsung said that the Nokia acquisition in April violated its 2011 deal with Microsoft.

Samsung has gone to arbitration at the Hong Kong office of the International Court of Arbitration of the International Chamber of Commerce.

Samsung  had agreed in 2011 to pay Microsoft royalties in exchange for a patent license covering phones that ran Google Android operating system.

Samsung also agreed to develop Windows phones and share confidential business information with Microsoft, according to the filing.

But once Microsoft acquired Nokia, it became a direct hardware competitor with Samsung, the filing said, and Samsung refused to share some sensitive information due to antitrust concerns.

Google unlocks advertising secret — don’t trust Google

google-ICSearch engine outfit Google has realised that the secret to getting people to install its home monitoring equipment is to pretend that it has nothing to do with it.

The outfit has started selling connected thermostat, its connected smoke alarm and its Dropcam monitors to the great unwashed.

The only problem is that Google has a bit of a rap sheet when it comes to personal privacy, and a in a moment of self-awareness, twigged that no one really trusts it. The common perception is that if Google was involved monitoring you, it must be selling some of your personal data  somewhere else.  If you have a dropcam monitor in your bog, and you have difficultly having a bowel movement, your computer will display shedloads of laxative adverts.

Google has got around the problem by not mentioning its name in any of its nationally televised ads and has made the adverts funny.

Nest is advertising itself with the image that it is a tiny bit weird to put these things into your home. But they’re also cool – and there is no question that Google is spying on you.

You can see the adverts here  and they do not mention the G word.

It is uncertain that this will be enough to ease punters fears about Google doing evil to their smoke alarm.