IT Winners and Losers: YouTube Fans and IBM’s CEO Up; Eliot Spitzer, the ‘Sparking’ iPod, H-1B Debate and Wal-Mart’s Linux PC Down

Which tech vendor had a week to remember—and which had one to forget? Which IT department needs a “do over,” and which exec should be looking for a new job? On Fridays, we chronicle what went right and what went wrong in the IT world during the past week.

LOSER: ‘Sparking’ iPod

Apple made news this week—but it wasn’t about the iPhone. It appears that Japanese government officials have ordered an investigation into “possible defects” in Apple’s first-generation Nano after one of them emitted sparks while charging, according to news reports. (The revamped second-gen Nano replaced its predecessor in 2007, two years after the Nano’s debut.) News reports cited an “unnamed official at Japan’s Ministry of Trade and Economy” who said the agency suspects that a lithium-ion battery could have been the source of the spark. You’ll recall that in 2006 there were unprecedented recalls of the lithium-ion batteries made by Sony that were used in Apple and Dell laptops. Japanese officials reported that no one was injured by “the spark.”

LOSER: A New (non-Blu-ray) HD DVD Standard Bearer

Thank God the HD DVD wars are over…wait, what did you say? No. No. No! News broke this week of a London company that is offering a new HD DVD format, called HD VMD, that is completely incompatible with Sony’s Blu-ray high-def DVD format, which, has just gotten rid of its main competitor, Toshiba’s HD DVD format, after a moronic five-year HD DVD war. This competitor, New Medium Enterprises, claims that its “system’s quality is equal to Blu-ray’s but it costs less,” reported The New York Times. (Toshiba’s product cost less too.) So far, New Medium has only 17 movies available to U.S. customers. And two of the 17 blockbusters are The Enigma With a Stigma and Kandukondain Kandukondain.

LOSER: The $199 Linux PC at Wal-Mart

Oh well. It was fun while it lasted. Wal-Mart said this week that it was going to stop selling PCs running Linux operating systems in its stores. The $199 Green gPC, which was made by a Taiwanese company named Everex, actually sold out on the shelves of 600 of Wal-Mart’s stores where it was offered, but demand for the cheap PC apparently wasn’t enough for Wal-Mart. “This really wasn’t what our customers were looking for,” said a Wal-Mart spokeswoman. Don’t worry, however: Walmart.com will continue to sell the Green gPC that Wal-Mart’s customers aren’t going to be looking for.

WINNER: YouTube Fans Everywhere

On Wednesday, YouTube published details of new application programming interfaces, or APIs, that that will “allow website operators and software developers to upload videos to YouTube, edit the titles, descriptions and ratings of videos and customize the user interface of the YouTube video player so that it fits the look of their site or application,” according to news reports. In response, TiVo said it has plans to enable its customers who have broadband Internet connections to watch YouTube videos on their TV sets. Which is very cool.

LOSER: Both Sides in the H-1B Debate

Microsoft Chairman Bill Gates told lawmakers this week that the U.S. is turning away the world’s best computer scientists and engineers by putting limits on H-1B visas and other immigrant work programs. “The fact is, [other countries’] smartest people want to come here and that’s a huge advantage to us, and in a sense, we’re turning them away,” Gates told members of the House of Representatives Science and Technology Committee. Unfortunately the issue isn’t that simple, and both sides on the debate repeatedly cite contradictory data that support their views, which the other side then says is flawed. Who wins in the end? Nobody.

WINNER: IBM’s Chairman and CEO

“Party at Samuel J. Palmisano’s house this weekend!” The chairman and CEO of IBM can afford it. In a regulatory filing on Monday, IBM reported that Palmisano got a nice 11 percent raise in 2007 to bring his total compensation to $20.9 million. One of his best perks was $406,235 worth of travel expenses that IBM covered. IBM didn’t do too badly last year either: Big Blue posted a profit of $10.4 billion.

LOSER: Wi-Fi Security

Lest you think that Wi-Fi security vulnerabilities had been fixed by now, they haven’t. Robert Lamprecht, an IT advisory supervisor at KPMG, said this week that although the 802.1x access protocol is a must for wireless network security, companies rarely use it and thus leave the door open for hackers, according to a news report. He said that were two problems: one is a lack of awareness by companies; two is that it’s just too complex. “Implementing 802.1x requires a lot of work,” Lamprecht said. “Companies often have to change their whole architecture.” That does sound like a lot of work.

LOSER: Hands-Free Cell Phone Motorists

To all of you “hands-free” cell phone users out there, guess what? You’re just as likely to be distracted by blabbing on your cell phone as the rest of us are who don’t have a cool little Bluetooth ear piece. That’s according to Carnegie Mellon University researchers. “The researchers used brain imaging to show that even just listening to a cell phone while driving cuts by more than a third of your attention to driving,” reported NetworkWorld. “Subjects inside an MRI brain scanner were tested on a driving simulator and were found to weave, similar to if they were under the influence of alcohol.”

LOSERS: Software Pirates

Last Friday, two brothers were sentenced to multiyear prison terms for selling “massive amounts of pirated software online,” the U.S. Department of Justice announced. The Robberson Brothers (Maurice A. and Thomas K.) made a lot of booty from their pirating businesses: Maurice grossed more than $855,000 selling software with a retail value of nearly $5.6 million through CDsalesUSA.com and AmericanSoftwareSales.com. Brother Thomas made more than $150,000 selling software with a retail value of nearly $1 million through Bestvalueshoppe.com and TheDealDepot.net. The DOJ said that from 2002 to 2005, the Robbersons sold counterfeit software from vendors such as Adobe Systems, Autodesk and Macromedia at discounted prices, though, not that discounted.

LOSER OF THE WEEK: Former N.Y. Gov. Eliot Spitzer

And last, but certainly not least, there’s the sordid tale of Eliot Spitzer. There’s no need to get into the dirty details of Client No. 9’s escapades and sudden downfall. But it sure is interesting to note that IT systems and the electronic paper trail (a favorite “gotcha” tactic of Spitzer-led investigations with he was New York’s attorney general) played a role in uncovering his indiscretions. As noted in a Wall Street Journal article, a wiretap and interconnected banking systems that track and report on “questionable transactions” under $10,000 alerted government agencies, including the IRS and FBI, that were eventually able to connect Spitzer, the Emperors Club and the money. Gotcha.