FryUp: It could be worse

Loathsome self abuse, Telecom's handsome profit and Google's app-lapse

Worse than P It is time to raise the alarm over a new, loathsome and dangerous form of self-abuse. Shuffling, especially the hardstyle variant, must be snipped in the bud. Increasingly common amongst male teenagers over the past few years, those who take it up suffer violent, grand-mal-like fits while upright and become victims of wide trouser legs. Moonboy

It could be worse Telecom’s first set of full year results under the new CEO Paul Reynolds may have caused the telco’s share price and the NZX to head downwards, but despite regulatory pressures and increased costs, it is still making a handsome profit. What’s more, there’s a dividend being paid and annual revenue is up a couple of per cent. Australia doesn’t seem to be the sea of red ink either that it was for Telecom until recently. Considering Telecom’s gone through operational separation and is facing limited competition for the first time, not to mention having to re-engineer its mobile phone network, it’s not a bad set of results at all. Next year, however, Telecom sees a further drop in profits, and there are some clouds on the horizon for the telco. The new WCDMA network is due to launch this year. In theory, having access to a much larger pool of UMTS/WCDMA gear at better prices should help Telecom compete against Vodafone. Note that Telecom isn’t likely to switch off the CDMA network any time soon, as it apparently still makes decent amounts of money as a telemetry transport. Is the golden era of making money hand over fist on mobile services coming to an end though? The Commerce Commission and the government is growing increasingly annoyed with Telecom and Vodafone charging high termination rates both wholesale and retail. Today, the Commission said it is considering a Section 3 investigation into mobile termination rates as, while they’re going down, they remain stubbornly high compared to the rest of the world. As a result, New Zealand customers use mobile phones for talking far less than in other countries, while both Vodafone and Telecom enjoy high margins on the per-minute charges. In other words, there’s little evidence to counter NZ Communications’ argument that the mobile market of today isn’t competitive and regulatory action is likely due to this. Vodafone will be the hardest hit if the Commission decides to chop termination rates, and will likely try to claw some of the lost revenue back by increasing competition in Telecom’s back yard, in the fixed-line calling and broadband arena. Here, Telecom’s done something rather peculiar and basically killed off its market-leading brand, Xtra, which was well-established and poised to deliver many of the services Kiwis are looking for from a modern telco. Perhaps the biggest problem Reynolds faces in turning the Telecom tanker away from the rocks is that while he needs to spend more on coming up with innovative products and services, the share market will punish him if he does. Spend less, do more, sounds great on paper, but in practice, it could hurt Telecom as it cannot compete as a full-service provider in all areas. Telecom guidance disappoints Street Smarts: Little to cheer at Telecom

Clouded computing So, here I am, telling Chris Keall to use Google Apps for his domain because… well, it's cheap, easy and I’ve never had any issues with Gmail etc. As soon as I’ve done that, I read on Computerworld that Google Apps suffered a fifteen-hour outage yesterday, related to Gmail. Ouch. Admins all over the world were up in arms and the debacle reminds me of why I used to do host as much internet as possible myself. Quite miss having a network, actually. I still think Google Apps is worth checking out, but it does mean all your eggs are in the same basket. Just something to bear in mind, in case you need to make a quick omelette. Google Apps hit by prolonged Gmail access problem

XKCD Holy Ghost


Robert X. Cringely Microsoft bites the bullet on .Net suit

After the Seattle Post Intelligencer reported last week that Vertical Computer Systems (VCSY) and Microsoft had settled their .Net patent suit, three Cringesters emailed me on a Sunday wondering why this story hasn't gotten more attention. (Though I have my suspicions as to why they did — see below.) As reported by Infoworld in April 2007, Vertical claims that .Net violated the patents on its SiteFlash technology, a "system and method for generating websites in an arbitrary object framework". A day before an important hearing on how to define terms used in the suit, Microsoft settled, buying a nonexclusive license to VCSY's technology for an undisclosed amount. If broadly interpreted, that license deal could spell trouble for more than just Microsoft, notes reader JC: "I think Microsoft's partners would want to know that there's no impending injunction on these products now that the case is settled and Microsoft was granted a paid-up license to the patent (# 6826744). Vertical announced it in the following 8-K on Friday. The non-exclusive terms could be potentially disruptive to many other web content software companies like Adobe, IBM, Documentum, Vignette, etc." Unlike many companies that exist purely as patent trolls, VCSY appears to have actual products, though not much in the way of actual revenue — just under US$6 million according to its 2007 annual report, with losses of around US$700K. I imagine that after the Microsoft license they're a little bit richer today.  Publicly traded on the Pink Sheets, VCSY's stock zoomed from 1.5 cents to 8 cents a share (as I write this) after news of the settlement leaked. Given the high volumes these stocks are traded at, even a shift of a penny can put thousands of dollars in one investor's pocket while taking thousands out of someone else's. As a result, the Pink Sheet markets are subject to heavy manipulation, usually in the form of spam and message board puffery. I suspect some of my faithful readers might have financial motivations for pushing this story. So far, neither company has revealed any more details about the settlement. I'd be shocked if Microsoft dropped the tens of millions or more that some VCSY shareholders are speculating, or that this tiny Texas company will suddenly take on everyone who generates websites in a similar way. But maybe I'm wrong.

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