Author: Nick Farrell

IBM disappoints with better than expected results

IBM logoIt seems that IBM cannot really win.  It released results which were much better than expected but it appears that shareholders were not impressed.

Net profit rose to $4.1 billion, or $4.12 per share, from $3.2 billion, or $2.91 per share, a year earlier. On an adjusted basis, the company earned $4.32 per share, beating analysts’ average estimate of $4.29.

However, analysts were quick to find fault. At the heart of the problem was the IBM’s software business which only grew one percent in the quarter to $6.5 billion, slower than forecasts of three percent.

Software revenue was IBM’s bread and butter and it had been growing quite well over recent years. The slowdown means that IBM is getting fewer contracts.

IBM Chief Financial Officer Martin Schroeter expected that software revenue would pick up to mid-single digits in second half of 2014.

There were a few one off problems too. In January, IBM sold its customer care business, which brought in approximately $1.2 billion in full year revenue in 2013, to hardware distributor Synnex, a sale the company expects to negatively affect revenue comparisons by $300 million per quarter.

Last quarter, the company saw a $870 million restructuring fee, which was largely completed and contributed to savings quarter over quarter.

One bright point was that it saw growth in its strategic sectors as business analytics was up 7 percent, cloud revenue grew 50 percent, and security revenue rose 20 percent.

Revenue fell 2 percent to $24.4 billion in the second quarter, above analysts’ average estimate of $24.1 billion. The wooden spoon was won by the Asia Pacific region which fell nine per cent. Revenue in the Americas fell 1 percent/

Net profit rose to $4.1 billion, or $4.12 per share, from $3.2 billion, or $2.91 per share, a year earlier.




Intel suffers

intel_log_reversedBuried in Intel’s glowing results was one anomaly – its tablet business was taking off while its mobile unit revenue fell like a free falling team of elephants.

It was possible to see a significant spike in tablets using its chips, up 10 million last quarter, but its mobile revenue was just $51 million. This was an 83 percent drop from a year earlier.

While it is possible to explain some of that drop by a fall in its phone modem chip business it turns out that this was the cost of “contra revenue”,

As president Ronald Reagan found out, giving money to contras is always going to get you into trouble and what you are seeing is the cost of Intel buying its way into the market.

For 2014 anyway, Intel is selling a chip into low-end tablets that costly and complex to design into devices than rivals.  Tablet makers are happy because they get a higher end Bay Trail chip  for their cheap tablets but Intel’s bottom line  suffers and it smacks of desperation.

It all means that Intel can say it is “on track” to reach its goal of selling 40 million tablet processors this year but this means that more “successful” Intel is at getting device makers to use its chips, the more money it will lose.

Intel does not seem to care either.  It has said that it is tablet program is expected to take the company’s entire profit margin down by as much as 1.5 percentage points this year.  Intel can afford it, but it is questionable if his makes sense and it if would be better to invest in the 3.30 at Ascot.

Intel thought Bay Trail chip it is selling to tablet makers would wind up in high-end devices which cost a fortune. Instead, Intel’s opportunities have been in lower-end devices such as the Asus Memo Pad, a device that costs around $150.

Intel does not expect the mobile unit to turn profitable next year, but the losses should narrow, CFO Stacy Smith told the world+dog.

CEO Brian Krzanich believes that over time we can make this a profitable business.

AMD eyes Nintendo for chips

AMD, SunnyvaleAMD thinks it can get back into the portable console business, and is hinting at a new deal with Nintendo involving its 3DS.

The vice president of AMD’s custom semiconductor business Saeid Moshkelani noted that AMD was doing rather well in consoles. It was providing the graphics processors for the Wii U, Xbox One, and PlayStation 4.

However, portable consoles, such as the 3DS and PS Vita use other processors and AMD wants a piece of that action.

Of course, he admits, that market appears to be drying up but he said that “believe it or not” the 3DS is still selling.’

He said that before AMD could invest any time on a project it would have to be worth at least $100 million annual revenue for us to go for it.

He said that no Android console has made anything like that amount of money and it is extremely hard to imagine Sony producing another handheld console after the PS Vita, which leaves Nintendo – who have confirmed they definitely are making another portable.

Nintendo has said that whatever their next handheld is it will share the same operating system as their next home console and therefore the same games and apps.

Though there are various models, Android does not face software shortages because there is one common way of programming on the Android platform that works with various models.

It is not clear if AMD actually has Nintendo in the bag as a customer, but the fact Moshkelani is talking about it makes it a good bet.


Bing says “thanks for the memories” EU

Bill GatesSoftware giant Microsoft has followed Google and set up a system which will allow Europeans to be forgotten.

Microsoft started taking requests from individuals in Europe who want to be removed from its Bing search engine results following a court judgment in May guaranteeing the “right to be forgotten.”

Google complied with the ruling in May, and started removing some search results last month.

The European Court of Justice of the European Union ordered Google to remove a link to a 15-year-old newspaper article about a Spanish man’s bankruptcy, effectively upholding people’s “right to be forgotten” on the Internet.

The ruling, which affects the EU’s 500 million citizens, requires that Internet search services remove information deemed “inadequate, irrelevant or no longer relevant.”

If it does not remove the link, then there could be fines. The rule only applies to EU countries, meaning links that have been removed in Europe will still appear in search results elsewhere, including the United States.

Microsoft  has released a four-part questionnaire. Microsoft advises those interested in completing the questionnaire that it will “help us to consider the balance between your individual privacy interest and the public interest in protecting free expression and the free availability of information, consistent with European law.”

If you want to be forgotten by Bing you should go here .

TSMC shares fall on rumours of chip cancellations

A not so mobile X86 PCTSMC shares fell as much as six percent after an analyst and Taiwanese media reported that Apple and Qualcomm were going to buy their next generation chips from elsewhere.

This is bad news as TSMC reported its highest quarterly profit since the end of 2006, and said it expected revenue to grow at least a record 20 percent this year. But its outlook was based on increased demand from Apple which recently chose TSMC over Samsung to make the majority of chips for the successor to its iPhone 5 series of smartphones.

But it looks like Apple and Qualcomm will likely buy a larger proportion of 14 nanometer smartphone chips from Samsung rather than TSMC beginning in the second half of 2015.

KGI Securities analyst Michael Liu said in a note to clients that he found that tasty bit of gossip following an investor conference held after TSMC reported second-quarter earnings.

The Commercial Times on Thursday, citing market speculation, said Qualcomm has already started working with Samsung to develop the chips. The Economic Daily News said without citing sources that Qualcomm had placed orders with Samsung.

However the rumours are not believed by everyone. Quanta Securities Analyst George Chang, who also attended the conference, said this was just a lot of speculation as no one has even seen the iPhone 6 yet, so it’s too early to say anything about future products.

During the conference, TSMC Chairman Morris Chang admitted that the company’s market share in 16 nanometer chips – which perform similarly to 14 nanometer chips – will be smaller than “a major competitor” next year, and that TSMC will claw it all back the year after.

Apple forms new alliance with IBM

ibm-officeApple and IBM do not appear to have given up on their on-again off-again relationship.

The pair have a troubled relationship.  Big Blue, and Microsoft, were one of the targets of Apple’s famous 1984 marketing campaign. IBM was supposed to be the outfit protecting the locked in status quo while Apple’s Macintosh provided a pathway to freedom with locked in products.

A  decade later, IBM and Apple entered into an alliance to produce a computer operating system to rival Microsoft Windows.

Dubbed Taligent, it was axed and Apple to bought Next, bringing back Steve Jobs into the company.

Jobs made two other partnerships with IBM back in the 1990s. Kaleida, spent several years failing to develop interactive CD-ROMs. Then there was the AIM alliance, hoped to build a rival platform to Intel’s personal computer. That created the PowerPC chip it produced would run Apple’s Macs for several years but the platform really went nowhere either.

This new glorious partnership to help companies deploy wireless devices and business-specific applications to run on them.

Apple CEO Tim Cook and IBM CEO Ginni Rometty were doing their best to be best buddies when they announced the tie-up.

Cook said: “If  you were ‘building a puzzle’ the two companies would fit nicely together with no overlap. We do not compete on anything. And when you do that you end up with something better than either of you could produce yourself.”

Rometty said the team-up will allow the two giants to sort out serious problems that had been inhibiting deployment of wireless in the enterprise.

In the deal IBM will use its investments in big data and analytics plus cloud computing services and mobility. Last year developed mobile software for the enterprise with an initiative it called MobileFirst. In working with Apple, it has created an extension, dubbed MobileFirst, for iOS.

The deal means IBM and Apple will develop more than 100 industry-specific applications that will run on the iPhone and iPad, including applications for security, analysing corporate data and managing the devices themselves. Jobs’ Mob will add a new class of service to its AppleCare program and support aimed at enterprise customers.

IBM will sell iPhones and iPads to its corporate customers and will devote more than 100,000 people, including consultants and software developers, to the effort.

The enterprise software will run on IBM’s cloud infrastructure or on private clouds. Data for those applications will co-exist with personal data like photos and personal email that will run on Apple’s iCloud.

The move will get Apple into the business sector, a sector which has never liked it much, by using IBM software to replace the holes in its own efforts. Big Blue, on the other hand, gets popular hardware it can provide to its business customers after flogging off its own to Lenovo.

All this depends on history not repeating itself.

Internet recycles news

typewritIt appears that the world wide wibble is recycling news as a way of saving time.

This time last year our reporters wrote a yarn about how the Russia’s Federal Guard Service (FSO), was  upgrading to old style typewriters to avoid a US style internet leak.

Apparently the FSO is so worried about a Snowden style leak that it has bought 20 new electric typewriters for $15,000.

The story went the way of all flesh, but this morning the world wide wibble was all a flush with the news that the Russians were replacing their computers with typewriters.

It appears that the Izvestiya newspaper ran the story this week and it was picked up by serious news sources. Only it did not. Izvestiya mentions the G20 summit in London, which was also last year.

What appears to have happened is that the story suddenly did a round on Facebook and hacks looking for a new story to tell their news editor pitched it as something new.

It is not like there is a new angle on it either; the story was the same as it was when Techeye and Izvestiya first mentioned it.  The story appears in the Washington Post which even linked to a USA Today story from a year earlier  The Guardian which ran the story last year at least added that the Germans were doing the same thing.  We have also seen news blogs which are repeating the same headline from 2013.  Of course the story is all over Facebook.


Windows Start menu leaked

Microsoft campusA leak has tipped up on the nternet suggesting what Microsoft’s new start menu will look like in Windows 9 

It had been known for some time that Microsoft had been reverting back to its start menu for desktop users after its move to a more tablet interface went down like rent boy at a Tory conference.

To be honest the start menu is not that exciting, unless you have tried to live without one for longer than a month.  It is all stuff which will be familiar to Windows 7 users with a couple of minor tweaks.

It is clear that this is an early build of next generation of Windows and might be tweaked still further before Windows 9 comes out. Still there is only so much that you can do to a start bar to make it new.

The image says that the start bar is for Win 8.1 Pro however, the world on the street is that it is actually a legitimate Windows 9 version. Builds inside of Microsoft still use this branding.

This build 9788 is said to be floating around the web but has so far not been a full leak. We expect that there will be a more complete leak in the near future.

In the meantime here is the thread where the leaks appear be being posted 


Man denies right to be forgotten

OgleA man is backing up the parts of Google and the worldwide web that people are asking to be forgotten.

Hidden From Google, the idea of a web programmer in New Jersey, archives each website that Google is required to take down from European Union search listings thanks to the recent court decision that allows people to request that certain pages be scrubbed from Google’s search results if they’re outdated or irrelevant.

There is a concern that the people who are making the takedown requests are mostly convicted sex offenders and huge banking companies who are abusing the system to hide their crimes.

Hidden From Google doesn’t automatically archive each website that disappears from searches—instead, it relies on news reports about specific websites that are removed.

The idea is that a person can submit a link that has been removed from Google, and the site will archive it. That means that the site is far from comprehensive. It only has a couple dozen stories listed thus far.  Google is wrestling with a backlog of some 50,000 requests.

Talking to Motherboard, Afaq Tariq, the site’s programmer said that Hidden From Google seemed to be something that was missing from the internet.

“Whether I agree with the concept or not, it is a perfectly legitimate way to archive the actions of this societal decision so an open discussion can take place on its impact. I built it with the notion of it empowering a fairly equipped debate.”

Tariq is not clear in his own head if the right to be forgotten should exist or not, but says that determining whether or not a website should turn up in Google searches should be a decision undertaken by the internet as a whole, not just one person.

Websites such as Chilling Effects catalogue takedown requests from the Digital Millennium Copyright Act, but have not yet begun listing sites removed from searches because of right to be forgotten requests.

Emily Hong, of Chilling Effects, wrote in a blog post that given the inherent subjectivity of the content, right to be forgotten requests promise to be even more ambiguous than copyright claims.

“Formulaic notice services are thus even more likely to upset the balance between privacy and freedom of expression by making fraudulent requests both easier to send and harder to detect. “In a pool of 50,000+ incoming notices, a false positive rate of just 0.1 percent would amount to 50 individual cases that result in the harmful loss of speech,” she wrote.

Chilling Effects is still wondering if it is possible, to catalogue all sites removed from Google searches as a result of the law.


The internet belong US

pressieThe US government has ruled that if data is on the internet, anywhere in the world, it has to be turned over to one of its spying organisations for processing.

President Barack Obama’s administration is insisting that that any company with operations in the United States must comply with valid warrants for data, even if the content is stored overseas.

This means that anyone who uses an iPhone anywhere in the world will see their data inside a US government database.

Microsoft and Apple insist that enforcement of US law stops at the border, but the government seems to think that it rules the world.

A magistrate judge has already sided with the government’s position, ruling in April that “the basic principle that an entity lawfully obligated to produce information must do so regardless of the location of that information.”

Microsoft appealed   and the case is set to be heard in two weeks.

The US government said that content stored online is not protected by Fourth Amendment protections as data stored in the physical world. It quoted a law put out by President Ronald Reagan called the  Stored Communications Act (SCA).  This said that overseas records must be handed over domestically when a valid subpoena, order, or warrant forces them. No one thought that the SCA stuffed up the Fourth Amendment so there is no need to change the laws.

However Microsoft said Congress has not authorised the issuance of warrants that reach outside US territory. It points out that the government cannot issue a warrant allowing federal agents to break down the doors of Microsoft’s Dublin facility.

Microsoft said that consumer trust in US companies is low in the wake of the Edward Snowden revelations and the government will make overseas operations impossible.

It has the backing of Apple, AT&T, Cisco, and Verizon agree. Verizon said if the government wins, it would produce “dramatic conflict with foreign data protection laws.” Apple and Cisco said (PDF) that the tech sector would be blacklisted by foreign governments.

Recently the senior counsel for the Irish Supreme Court wrote in a recent filing that a US-Ireland “Mutual Legal Assistance Treaty” was a way for the US government to obtain the e-mail held on Microsoft’s external servers.


GCHQ uses internet as a toy

chamberThe British spy agency GCHQ has developed tools to seed the internet with false information.

According to security writer Glenn Greenwald  the British spooks have the ability to manipulate the results of online polls, artificially inflate pageview counts on web sites, “amplify” sanctioned messages on YouTube, and censor video content judged to be “extremist.”

GCHQ’s capabilities were found amongst documents provided by NSA whistleblower Edward Snowden.  The British even use a trick to connect two unsuspecting phone users together in a call.

The software tools were built by backroom boffins working for GCHQ’s Joint Threat Research Intelligence Group (JTRIG). It appears to be a clear indication that the British are using  propaganda and internet deception. We have seen already the use of “fake victim blog posts,” “false flag operations,” “honey traps” and psychological manipulation to target online activists, monitor visitors to WikiLeaks, and spy on YouTube and Facebook users.

However the GCHQ document called “JTRIG Tools and Techniques” shows just what sort of skulduggery the British are up to online.

According to Greenwald, the document us designed to notify other GCHQ units of JTRIG’s “weaponised capability” when it comes to the dark internet arts, and “serves as a sort of hacker’s buffet for wreaking online havoc”.

Spanish wi-fi outfit goes under

Spanish flagSpanish wireless networks provider Gowex has filed for bankruptcy a week after an accounting fraud at the firm was revealed.

The Spanish High Court said its founder could face a jail sentence of more than 10 years.

Gowex has apparently decided to file for bankruptcy because it was in a state of “imminent insolvency” and faced a “financial standstill” after a high number of contracts were ended and new projects were cancelled.

Former Chief Executive and Chairman Jenaro Garcia Martin’s head is on the bloc after admitting that he had misresented the financial accounts for at least the last four years.

He has been charged with false accounting, distortion of economic and financial information, and insider trading.

Garcia Martin made the admission before the High Court on Monday and had his passport seized and was banned from leaving Spain. He was also ordered to report to a court every week and was given 15 days to pay a 600,000-euro ($818,400) bail or face jail.

High Court examining judge Santiago Pedraz was worried that Garcia Martin might attempt to flee as he faced a jail sentence of more than 10 years. He also had  3 million euros in a Luxembourg-based bank account.

Gowex started insolvency proceedings last week and had a maximum of four months to reach a deal with creditors or enter into administration.

A judge now has to rule on whether Gowex was correct to file for bankruptcy.

Gowex hired PricewaterhouseCoopers (PwC) to carry out a forensic audit of its accounts, but the accountants said that it could not carry out the audit because it could not find authorised representatives of Gowex and get access to the information.






Apple’s A8 chip goes like the clappers

gala_appleFruity purveyor of expensive mobile phones Apple has developed a new A8 processor chip based on new 20-nanometre technology for its mobile platform.

The new chips are expected to be under the bonnet of the new iPhones and iPads which are expected this Autumn.

The A8 chip is being made by a joint venture of Samsung and TSMC and word on the street is that the new A8 chip is capable of clock speeds of up to 2.0 GHz or more because its chip is fabricated using 20nm technology.

The 20nm technology means the chip consumes less power in comparison to the current generation A7-powered that are clocked at 1.7 GHz and adopt 28nm chip tech.

This entire change means that the A8’s 20nm chip gives power savings and goes like the clappers. Otherwise, the A8 follows the 64-bit dual-core processor architecture of the A7 chip.

Apple’s design seems to be based on packing more transistors into its 64-bit dual-core architecture instead of just increasing the number of cores. This is against the philosophy of other designers who want smoother multitasking. It appears that Apple wants more marketable clock speeds.

Samsung suspends supplier contract over kiddie labour

android-china-communistSamsung has suspended business with a Chinese supplier over allegations of employing child labour.

The move comes a week after a US watchdog report accused the supplier of using underaged workers and Samsung promised to investigate.

Samsung said its investigations had found an “illegal hiring process” at Dongguan Shinyang Electronics which supplies mobile phone covers and parts.

Samsung added that it had previously found no child workers at the Chinese company in three audits since 2013. The latest audit ended on June 25.

The company said that it would cut all ties with the supplier if the allegations were true.

“If the investigations conclude that the supplier indeed hired children illegally, Samsung will permanently halt business with the supplier in accordance with its zero-tolerance policy on child labour,” it said.

US-based China Labor Watch released a report on last week claiming that the Chinese firm used child labour. The watchdog said it had found “at least five child workers” without contracts at the supplier.

Samsung demands suppliers adopt a hiring process that includes face-to-face interviews and the use of scanners to detect fake IDs, to ensure no child labourers are employed.

China Labor Watch said that Samsung’s monitoring system was ineffective because it was failing to catch the use of child labour by the supplier.




Amazon faces off with the French

Obama BarackUS bookseller Amazon is engaged in a war of words with the French government.

Last month, the French parliament stood up for small book retailers and voted to ban major online book retailers, including Amazon and the French retailer FNAC, from offering free delivery on book orders.

The idea was that if customers had to pay for delivery for books they would be more inclined to shop at their local bookshop.

However it appears that they did not think the law through properly. Amazon did start charging for delivery, it was just that it charged a Euro cent.

It posted the following FAQ saying:

“We are unfortunately no longer allowed to offer free deliveries for book orders. We have therefore fixed delivery costs at one centime per order [0.01 Euros, or roughly a US penny] containing books and dispatched by Amazon to systematically guarantee the lowest price for your book orders.”

France has had a long running war on major US tech companies flogging books.

In 2011, the country updated an old law related to printed books that then allowed publishers to impose set e-book pricing. In 2012, there was a spat between French lawmakers and Google over the country’s desire to see French media outlets paid for having their content pop up in search results.

In most cases, the solution involved a quick and easy way to regain the upperhand. Google suggested it would sooner cut off French media sites than pay them for the snippets of content it features in search results. This would kill off the newspapers online efforts, or give a commercial advantage to those who did not insist Google paid up.