News and analysis to 16^th May 2003

Microsoft held at Passport control

The US Federal Trade Commission is giving consideration to investigating Microsoft in respect of its Passport offering. This supposedly secure e-wallet service, which holds the personal details of many unsuspecting e-shoppers has a fault that allows hackers to exploit the password reset function. Thus it is possible to steal a user’s account. Maybe this is an advanced feature of Passport, but I do feel that the share account function should be set to ‘off’ by default.

Rebranding Gateway

Once leading PC supplier Gateway is looking to get back in the limelight. It has plans to release no fewer than 50 new products and to reposition itself as a technology integrator. Migrating your strategy to fit your name is a somewhat novel approach, but it will help with rebranding. Unfortunately the SEC’s recent probe into Gateway’s accounting practices may give it more publicity than it had planned for.

CDM is the new CRM

CRM specialist Siebel might like to consider investing in CDM (Company Disclosure Management) following an SEC inquiry into whether it broke disclosure rules by releasing information to a select number of analysts. The alleged leak caused the share price to hop 8%. A similar situation a year ago resulted in a 20% jump. Day traders should mark your diaries for what appears to be an annual event.

i2BM

Dotcom technology boutique i2 is nuzzling up even closer to ‘going places’ IBM so that its supply chain management products surf the wave created by IBM’s enterprise applications. Given the importance of supply chain management to all businesses going forward, I would not be surprised if i2, or at least i2’s technologies, get absorbed into the IBM ecosystem.

Rum deal for EDS

EDS’s rivals will be jeering “Yo ho ho” as its outsourcing contract with the US Navy appears to have sprung a financial leak. This ‘flag ship’ contract contributed $334m to EDS’s first quarter loss of $126m. Plank walking is unlikely given that the new leadership only took over in March.

Impress your friends

The subject of Microsoft comes up. You ask in an assured manner what they think of Microsoft’s strategy behind projects Blackcomb and Longhorn. These are the respective code names behind Microsoft’s next generation server and desktop operating systems. If your IT department seem to be a little ‘off the pace’ fire the question at them and enjoy the reaction. Worst case scenario is that they say “ We have no idea, what’s your view?” The sage response is “As far as I am concerned at this stage they are nothing more than a couple of blue sky wish lists. Then smile, turn on your heels and walk briskly away from the scene of the conversation. Feel free to clench your fist and whisper “yes!”

HP - Hurassic Park

Despite the fact that HP’s acquisition of Compaq simply increased their exposure to a declining hardware market, the integration between the two companies has been a roaring success. So impressed are HP with themselves that they now envision a world where Darwinian principals drive business success. HP is not so much focusing on ‘the survival of the fittest’ principal, as on ‘the survival of those most adaptive to environmental change”.  HP feels that the Compaq digestion exercise has taught it lessons about the ‘adaptive enterprise’ which it now wants to incorporate into its products and services going forward. This is a compelling vision for corporate clients, but I have reservations at the consumer end. How will they pitch this? Possibly -  “Buy HP PCs and you’’ll always be ready to assimilate your neighbours IT infrastructure, should market conditions deem it necessary”.

An IT career is not so demanding

According to the Information Technology Association of America, demand for staff has reached a four-year low. The demand is down 50% from last year. The hiring managers questioned stated that IT staff levels would either remain at the same level or decrease in the next 12 months. Compensation levels appear to have reached a plateau. There is growing school of thought that we are not in a recession / technology nuclear winter. This is in fact the ‘new normal’. If this is the case then only the leanest and most agile/adaptive companies will survive. The only way to achieve this is to actually move IT centre stage, rather than treating it like some non-core ancillary service.

Michael Dell drops computers

This is not a case of butterfingers. In order to migrate his business towards a more IBMesque services based model, Mr Dell needs to shake off the old ‘tin shifter’ image. Consequently Dell Computers will become simply Dell. It is not known whether they considered DBM.