Cyber Ramblings - May 29, 2001

29 May 2001
Compiled by Kevin Smith

EMC Cuts 1,100 Jobs

Data storage company EMC Corp. says it will cut 1,100 jobs, or 4 percent of its worldwide work force, in an effort to cuts its operating costs. Its stock price dropped more than 8 percent by midday. About three-quarters of the job cuts will be domestic. The company says the cuts over the next several weeks will also give it more "flexibility in seizing opportunities as the economy stabilizes." The job cuts are among several steps the company is taking to increase its market share and are aimed at bringing costs in line with its efforts to boost revenue by 20 percent this year. The company says it expects a charge of $0.01 per share in the second quarter to cover the cost of staff reductions and redeployment. The job cuts are intended to eliminate redundancies and overlaps in certain field operations. The company also says it has planned several other cost-cutting measures, including reductions in the use of consultants and contractors

Echelon Recommends More Encryption in Europe

Europeans should make more use of encryption software to protect them against a U.S.-led spy network known as Echelon, according to a European Parliament report released Tuesday. The 108-page report, prepared after seven months of testimony from communications and security experts, concluded that the worldwide spy network does exist, despite official U.S. denials. But the Parliament's vice president, Gerhard Schmid, conceded that the committee had no solid evidence that Americans were passing on European trade secrets to give U.S. businesses a competitive advantage.

Companies Teaming up on Instant Messaging

Four major cell phone makers said Tuesday that they have agreed to work together to develop enhanced instant messaging services that can be swapped using their products. Sweden's LM Ericsson, France's Alcatel SA, U.S.-based Motorola Inc. and Germany's Siemens AG said they will cooperate in implementing an open standard dubbed EMS so users of their products can more easily exchange increasingly elaborate messages. The technology expands on the so-called short message service, or SMS, which has become extremely popular in Europe. SMS lets mobile phone users send each other text messages on their handsets by pressing numbers on the keypad that are coordinated with letters. New services will let people download and exchange screen savers, images and ring melodies from the Internet, according to a joint statement. The companies said they were expecting the shipment of EMS-enabled telephones to start in the second half of this year.

MSN Tries to Lure AOL Users

A week after America Online said it was raising rates for unlimited monthly Internet access, Microsoft Corp.'s MSN Internet division has launched a $50 million campaign aimed at getting AOL users to switch to Microsoft's service. Microsoft said Tuesday that it will offer three months of free Internet access to people who switch by June 30. The company also guarantees that monthly fees will remain at $21.95 for unlimited access through January 2003. AOL, the market leader with about 29 million subscribers, recently said it was raising rates for unlimited Internet access by $1.95, to $23.90, beginning in July. Analysts have said that AOL's decision to increase prices would likely cause few defections, but could mean hundreds of millions of dollars in revenue for parent company AOL Time Warner Inc. Cutting 15 percent of Workforce

Online financial news provider Inc. said Wednesday that it was planning to cut more than 15 percent of its workforce in an effort to cut costs, becoming the latest casualty of the slowdown in online advertising. The San Francisco-based company also said it will reduce its discretionary spending in areas like marketing, travel and entertainment and contract services. As a result, it said it expects to reap savings of more than $9 million, excluding a restructuring charge to be taken this quarter, from its operating budget through the year's end. In April,, of which British media group Pearson PLC and CBS parent Viacom Inc. each own about 35 percent, said that it expected its total 2001 revenues to fall about 5 percent due to the decline in ad spending.

ICANN Meeting This Week

With no major initiatives on the table, the upcoming meeting of the world's controversial Internet naming authority is likely to focus on new registries, such as ".name," that are looking to upstage ".com." ICANN, which meets in Stockholm this weekend for its quarterly conference, chose seven companies to operate parts of the master list of domain names last November. Each will have the right to sell names with new suffixes: ".name," ".biz," ".info," ".museum," ".pro," ".coop" and ".aero" to create more choice alongside the current trio of generic domains ending with ".com," ".net" and ".org." Global Name Registry, the tiny Internet upstart behind the ".name" registry, is expected to reap millions of dollars from handing out domain names to individuals and plans to use the cash to become the electronic world's main identity tool.