Computer Industry

Rather than storming the podium to tell customers, suppliers and shareholders of their glorious plans for the new year, many computer industry executives seemed content to let 1993 slip away with a whimper.So please allow a visitor taking up several weeks' residence in this space to offer some thoughts on what the computer industry should resolve to do in the new year.It's a cut-throat world out there, with hardware makers still reeling from price wars.Now more than ever, no company can afford a reputation for providing misleading or incomplete information or botched products.

When Annapolis politicians decided to single out the computer services industry for a 6 percent sales tax last November, the move horrified the professional geek community but didn't elicit a murmur of protest from its lobbyists. That's because there were no computer services industry lobbyists. "They never had a chance," said lobbyist Laurence Levitan, a former chairman of the Senate Budget and Taxation Committee. "Everybody else was organized, but nobody was organized for this particular tax."

SAN FRANCISCO -- A flurry of developments announced by computer companies last week indicates that turmoil from recession and fast-changing technology is likely to be the rule in the industry for some time.Nothing better illustrates the continued upheavals than Compaq's announcement that it was withdrawing from the Advanced Computing Environment consortium.Compaq, along with Microsoft, Digital Equipment, Silicon Graphics and MIPS Computer Systems, played a key role in forming the consortium last year, but has now decided that the consortium does not hold the key to next-generation desktop computing after all. The group had once hoped to set standards based on a computer-on-a-chip from MIPS and a new software operating system from Microsoft.

If you want to get rid of an old computer responsibly but don't know how to go about it, things may get easier in Maryland starting this summer. A bill establishing a statewide computer-recycling program squeaked through the General Assembly this week on the last day of the 2005 session after getting last-minute support from Hewlett-Packard - which has its own computer-recycling programs and initially favored a different approach. "The important thing was that in the end, everyone was for the bill," said Del. Dan K. Morhaim, the Baltimore County Democrat who sponsored the measure.

NEW YORK -- U.S. stocks were mixed yesterday after a profit warning from Cirrus Logic Inc. sent semiconductor and other computer issues lower. Expectations that short-term interest rates will fall helped bank shares gain for a third day.Cirrus Logic shares tumbled $7 to $19.88 after the computer chip maker trimmed its earnings forecast for the quarter ended Dec. 31, its second revision in two months. The warning fed concern that weakening sales will curb the computer industry's profit growth.

NEW YORK -- U.S. stocks fell to their lowest point in almost six months as computer-industry stocks slumped on concern that the pace of business may slow as the year wears on. Microsoft Corp. and Intel Corp. led the decline.While Microsoft's fiscal fourth-quarter earnings topped estimates, its software sales were aided by aggressive price zTC cuts in the personal computer industry. Some investors said that suggests demand may be wavering.The Dow Jones industrial average fell 44.39, to 5,346.

The computer industry is fuming over the latest signs that an export speedup policy ordered by President Clinton has actually doubled licensing times for many sales and allowed a greater role for its arch-enemy, the Arms Control and Disarmament Agency.At issue is a Dec. 5 executive order that Clinton promised would cut maximum licensing times for high-tech exports by 25 percent, to 90 from 120 days. The streamlining was offered in exchange for giving security agencies the right to review all export applications to the Commerce Department.

NEW YORK -- U.S. stocks rose to records yesterday as investors looked past inflation warnings from a Federal Reserve governor and focused on unexpectedly strong profits from Eastman Kodak Co. and others.The Dow Jones industrial average gained 38.49 to a record 6,765.37. Kodak paced the rise, gaining $4.25 to an all-time high of $85.50, after it reported earnings jumped 22 percent in the fourth quarter.The decline in stocks and bonds came after Fed Gov. Laurence Meyer suggested that faster growth could force the Fed to raise interest rates to head off inflation.

When Kumar Rajesh was rushed to Shady Grove Adventist Hospital in Rockville, doubled over by kidney stones, he might have expected a fruit basket or a get-well wish from his boss. Instead, he got a lecture about how the time lost reflected badly on his work record. Rajesh, then 24, was a systems analyst employed by Tata Consultancy Services, an Indian firm that contracts with U.S. companies to provide computer experts. He and more than a half-million other immigrants, many from India, are at the crest of a wave of high-tech foreign workers who have surged into the United States over the past decade at the urging of the computer industry and its lobbyists under a program created by Congress in 1990.

SAN FRANCISCO -- Top executives of Apple Computer Inc. were to visit IBM headquarters in Armonk, N.Y., yesterday to discuss a far-ranging technology alliance that could have a major impact on the computer industry, industry executives said.One part of the talks, according to these executives, was a proposal for IBM to license from Apple, and perhaps even to help develop, basic software for a new line of Apple computers that will be a successor to its Macintosh family.The companies also were to discuss whether Apple will use a powerful IBM microprocessor that IBM uses in some of its computers.

Comedian Rodney Dangerfield's lament "I don't get no respect" might just as well be the cry of sales professionals everywhere. In an increasingly sophisticated business environment, denizens of sales departments often have an image of being as outdated as white patent-leather belts, double-knit slacks and men with dinner-plate-sized gold medallions dangling from their necks. "You never hear anyone say, `When I grow up, I want to be a salesman.' In fact, most people get into sales by mistake," said David A. DeCenzo, director of partnership development and professor of management at Towson University.

MOUNTAIN VIEW, Calif. - Handspring Inc., the handheld computer maker started by the people who developed the PalmPilot, cut by 40 percent the money it seeks to raise in an initial stock offering, a move that comes after shares of rival Palm Inc. dropped that much in six weeks. Handspring hopes to make $220 million before expenses in the sale, less than the $300 million originally planned, according to a filing with the U.S. Securities and Exchange Commission. It plans to sell 10 million shares, or about an 8 percent stake, at $19 to $22 apiece.

Don't expect to see a huge shake-up in the computer industry -- or even any changes on store shelves -- just because a federal judge ruled yesterday that Microsoft Corp. broke antitrust laws by illegally extending its PC software dominance into the market for Internet browsers, industry insiders said yesterday. Microsoft has earned its reputation as a dogged rival and a bare-fisted street brawler: About 90 percent of the world's PCs run on the company's Windows operating system. In view of that corporate culture, the Redmond, Wash.

When Kumar Rajesh was rushed to Shady Grove Adventist Hospital in Rockville, doubled over by kidney stones, he might have expected a fruit basket or a get-well wish from his boss. Instead, he got a lecture about how the time lost reflected badly on his work record. Rajesh, then 24, was a systems analyst employed by Tata Consultancy Services, an Indian firm that contracts with U.S. companies to provide computer experts. He and more than a half-million other immigrants, many from India, are at the crest of a wave of high-tech foreign workers who have surged into the United States over the past decade at the urging of the computer industry and its lobbyists under a program created by Congress in 1990.

SCOTTS VALLEY, Calif. -- Seagate Technology Inc., the world's No. 1 computer disk-drive maker, says it will buy the rest of its software unit, gaining control of an investment it can use for acquisitions or sell to raise cash.The company will acquire the 6.5 percent of its Seagate Software unit it doesn't now own for 8 million shares, or about $280 million, and take a $216 million charge. Seagate also gets full ownership of 61 million shares of Veritas Software Corp. shares, valued at about $4 billion, which are owned by the software unit.

HOUSTON -- Compaq Computer Corp. needs to move quickly to find a replacement for ousted Chief Executive Officer Eckhard Pfeiffer as the No. 1 personal computer maker grapples with its PC strategy and two big acquisitions, analysts said yesterday.There are few qualified candidates, analysts said, and competition for those executives will be fierce because Hewlett-Packard Co. also is looking for a new CEO. Rick Belluzzo of Silicon Graphics Inc., Eric Schmidt of Novell Inc. and Sam Palmisano of International Business Machines Corp.

BRUSSELS, Belgium -- Compaq Computer Corp.'s $8.35 billion acquisition of Digital Equipment Corp. is likely to face a full inquiry by the European Union, possibly delaying the computer industry's biggest takeover, analysts and lawyers said yesterday.The European Commission, which enforces EU antitrust policy, is expected to disclose early next week whether it will extend its deadline for a decision by four months. That could push a ruling into late July.Regulators are investigating whether a combination of No. 1 personal computer maker Compaq with Digital will limit a rival's access to the European market for PCs and computer services.

SAN FRANCISCO -- Top executives of Apple Computer Inc. will be visiting IBM headquarters in Armonk, N.Y., today to discuss a far-ranging technology alliance that could have a major impact on the computer industry, industry executives say.One part of the talks, according to these executives, is a proposal for International Business Machines to license from Apple, and perhaps even to help develop, basic software for a new line of Apple computers that will...

In a partnership of two computer titans -- and rivals -- IBM Corp. said yesterday that it will sell technology valued at $16 billion to Dell Computer Corp.Under the terms of the seven-year deal, one of the largest of its kind in industry history, Dell will buy disk drives, memory chips, flat-panel displays and other components from IBM.The agreement also calls for IBM and Dell to share patents and collaborate on the development of new products."We mean this as much more than just a procurement agreement.

DELL COMPUTER Corp.'s fourth-quarter earnings report last week sent rumbles through the stock market as the company reported weaker-than- expected sales. Although Dell's quarterly sales rose 38 percent to $5.2 billion, they marked the first time in two years that the company had reported sales growth of less than 50 percent. On Wednesday, shares in Dell tumbled $7.1875 to $81, dragging down a number of other PC maker and technology stocks, as well as the Dow Jones industrial average. Do disappointing sales at the No. 1 direct seller of personal computers for business portend a slowdown in sales throughout the PC industry?