by CIO Staff

Top Ten IT News Stories of the Week: Sun to Cut Workforce

Jun 02, 20066 mins

1. “Sun to Cut as Many as 5,000 Jobs,”Computerworld, 5/31. After barely a month in his new role as chief executive officer, Sun’s Jonathan Schwartz is finally doing what analysts have been begging the financially troubled company to do for some time: restructure. He committed to lay off as many as 5,000 Sun staff, or 13 percent, sell some of the vendor’s real estate and simplify its product line, all with the aim of boosting profits. Sun hopes to realize maximum annual savings from these moves of US$590 million. One analyst suggested Schwartz is streamlining Sun so the company would be more attractive to would-be buyers.

2. “Google CEO Reiterates Concerns Over IE7,”, 6/1. While the search engine company rushed to quash rumors that it might be developing its own Web browser, Google was also quick to stomp all over Microsoft’s planned Internet Explorer 7 (IE7) offering. Google CEO Eric Schmidt this week restated his company’s concerns about IE7, which is currently in beta testing. The Microsoft browser contains a search box set by default to Gates Inc.’s search engine. Google has complained to both the European Commission and the U.S. Department of Justice, with the DoJ already dismissing the vendor’s concerns as groundless. Schmidt stated that Google doesn’t see any user need to develop its own Web browser given the already healthy competition Microsoft faces from Firefox, Opera and Apple’s Safari.

3. “EU Called Wrong to Allow Passenger Data Release,”, 5/30. The European Court of Justice this week ruled that the European Union’s decision in May 2004 to share personal information with American authorities about passengers flying from the union to the United States was illegal. The information included details of passengers’ names, addresses and travel schedules and came in response to the Sept. 11, 2001 terrorist attacks in the United States. The court will allow the agreement to stand for another four months. During that time, the European Commission and U.S. authorities will work out how to proceed to ensure that the exchange of data continues and transatlantic flights aren’t disrupted when the agreement expires in September.

4. “CA Delays Final Q4, FY ’06 Financials, Restates Q3,”, 5/30. Software vendor CA still isn’t out of the woods with its financials. The company is midway through a transformation of its entire business in an attempt to distance itself from an accounting scandal that occurred several years ago. However, in a surprise announcement this week, CA revealed it would delay issuing its final fourth-quarter and full fiscal 2006 results and restate its third-quarter financials. At fault appears to be a new sales commission plan that wasn’t properly tied into the company’s overall financial performance. The vendor’s latest misstep follows the recent departure of several senior executives including CA’s chief financial officer, chief operations officer and chief technology officer.

5. “Microsoft’s Windows Live OneCare Now Shipping,”, 5/31. Microsoft’s entry into the security software market with a fully supported version of its Windows Live OneCare product is set to shake things up. Established security players Symantec and McAfee are falling over each other to deliver software that provides the same backup and PC-tuning features as Gates Inc. Symantec will have Genesis by year’s end, and McAfee expects to deliver Falcon by September. (Both are still known only by code names.) Microsoft’s Live OneCare includes firewall, antivirus and backup software along with the vendor’s Windows Defender antispyware technology.

6. “CIO Says Open Source Is Too Risky,”, 5/31. When deciding upon a new content management system, Colin Knowles, the chief information officer of the Australian Broadcasting Corp., ruled out open-source software as being too risky. Although using open-source technology is often deemed low-risk since it’s less expensive and quicker to get up and running than going the proprietary route or home-growing software, Knowles stressed the importance of taking other risk factors into account. In particular, he wondered whether adopting open-source software will ultimately pay off for organizations in the long run, or if that adoption would involve developing and reinventing capabilities that already exist in packaged software.

7. “Security Gurus Watch Reappearance of Yapbrowser,”, 5/31. A Web browser known as Yapbrowser has reappeared despite being taken down in April after security analysts found it was directing users to child pornography. Yapbrowser is one of a number of rogue browsers that take users to ads or other content they don’t ask to see. So far, the new version of the browser doesn’t appear to work, but analysts are keeping a careful eye on it. Back in April, once alerted to the content it was fetching, Yapbrowser’s Russian creators withdrew the product.

8. “Ballmer Lobbies for Microsoft’s R&D Spend”InfoWorld, 5/31. Look to the long term was the word from Steve Ballmer to Wall Street this week. The Microsoft CEO was trying to convince financial analysts that the software giant’s plan to boost its R&D budget for next year by around US$2.6 billion will likely pay off as such investments have in the past. “Everything about Microsoft takes a long-term view, I’m afraid,” he said. Take the Windows operating system, for example, Ballmer suggested, noting that although the product first appeared in 1983, it didn’t start to bring in any significant revenue for Microsoft until 1993 or 1994.

9. “McAfee Fires Exec Amid Options Review,”San Jose Mercury News, 5/31. There’s a growing scandal in Silicon Valley over stock options. This week, McAfee fired its general counsel, Kent Roberts, during an internal review of how the security software vendor issued stock options to executives and staff during the late 1990s and early 2000s. It’s not clear what exactly Roberts is accused of doing in an episode that occurred in 2000—whether it concerned his own options or his actions in overseeing the stock option program as a whole. McAfee is holding informal discussions with the U.S. Securities and Exchange Commission and the Department of Justice about the options-granting procedure.

10. “Claim to ’Web 2.0’ Brand Provokes Blog Uproar,”

Macworld, 5/30. Don’t incite the wrath of the blogging community. Media companies CMP and O’Reilly learned that lesson the hard way this week. The U.S. firms had demanded that an Irish organization refrain from using the “Web 2.0” term to promote a conference. CMP claimed the phrase as one coined by O’Reilly and cited its efforts to file for a trademark in the United States and Europe, while Ireland’s IT@Cork maintained Web 2.0 was already a generic term. Bloggers got busy and made their feelings plain that the majority of them supported IT@Cork’s take. CMP later backed down and said the Irish group could use Web 2.0 after all.

-China Martens

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