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Technology Bright Spots in 2003
In perhaps the most highly anticipated and anti-climactic departure of a troubled executive, Gary Winnick -- founder and head cheese of collapsed telecom Global Crossing Ltd. -- resigned on Monday. Winnick had been under the microscope by federal officials for Global Crossing's creative accounting, but the Justice Department recently said it did not have enough evidence to file charges against Winnick or other company execs. Winnick sold off $734 million in Global Crossing stock before the company's collapse. Global Crossing has announced it will elect two independent directors and audit committee members to replace Winnick. Talk about out with the old, in with the new.
• The Washington Post: Global Crossing Chairman Resigns
• BBC Online: Global Crossing Names New Chiefs
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Speaking of creative accounting, business software maker Ariba said it plans to restate its financial results for the fiscal year ended Sept. 30, 2001, in response to a review by its audit committee. The California company said it initially counted a $10 million payment to its former president and chief operating officer as a personal transaction, since no company funds were used. The money came from the personal funds of Ariba's chairman. But now the company said the transaction should be handled as a capital contribution to Ariba. The change, which only affects the results for the quarter ended March 31, 2001, will show a non-cash charge to Ariba's fiscal 2001 operating expenses. The small change does not affect the company's cash balances, net assets or stockholder's equity, the company said in a statement. All in all, Ariba's restatement pales in comparison to those of WorldCom, AOL Time Warner and other tech giants.
• InfoWorld: Ariba To Restate 2001 Financial Results
• Reuters: Software Maker Ariba Restates '01 Results
Aerospace giants Hughes Electronics Corp. and Boeing Satellite Systems Inc. are under fire for allegedly aiding China's space program. The State Department says that the companies broke the law by swapping sensitive U.S. space technology to China in the 1990s -- technology that could have aided China's development of intercontinental missiles, The Washington Post reported yesterday. The Wall Street Journal and others followed the report with their own dispatches. Hughes and Boeing have denied any foul play.
• The Washington Post: Firms Accused of Giving Space Technology to China
• Reuters (via CNNMoney): Boeing, Hughes Charged By U.S.
• The Wall Street Journal: Hughes, Boeing Unit Are Charged With Illegally Giving China Data (Subscription required)
It's no secret that the last two years have been brutal for tech companies across the nation. Just how bad? Only 20 publicly traded companies based in the Silicon Valley have a higher stock price now than they did on March 10, 2000, the peak of the Nasdaq boom, according to the San Jose Mercury News. The Washington Post did a similar report today, taking a look at the performance of Washington-area tech companies since March 10, 2000. Only 10 D.C.-area companies fare better now than that fateful day. In the Valley, some of the winners include Borland Software and Varian Medical Systems. Back in D.C., it's the companies that sell IT services to Uncle Sam that are doing best.
• The Washington Post: Rebound Continues To Elude Most Local Tech Stocks
• The San Jose Mercury News: Scott Herhold: Survivors of the Bust Inspire Loyalty, Patience
Do you want exact data on how many workers are being laid off by companies nationwide? The Department of Labor has been kind enough to compile that info. for economists and other interested parties, but that's about to stop. Seems things are so bad with the economy that there's no federal dough to keep tabs on layoffs. The Bureau of Labor Statistics will stop publishing monthly data about national factory closings and major job cutbacks because of a lack of funding for the program. The Mass Layoffs Statistics report tracked unemployment insurance data on establishments with at least 50 claims filed against them in a five-week period. Labor unions are not thrilled with the decision since it makes it hard to analyze which sectors are doing poorly and which industries are doing well. The last official tally? More than 240,000 people lost their jobs in November. This is not the first time the data mill on layoffs has stopped. The Mass Layoffs reports were cut in November 1992 due to lack of funding and picked up again three years later.
• The Washington Post: U.S. Drops Report on Mass Layoffs
• WorldNetDaily.com: Thousands Greet New Year Newly Laid Off
Don't take the Internet for granted. Most people in Ecuador don't have access to the Web -- only 2.7 percent out of 13 million Ecuadorians, the New York Times reports today, citing statistics from the Ecuador-owned communications company Conatel. "In the late 1990s, everyone jumped up in arms over the digital divide, but it has proven almost impossible to bridge," Peter Hakim, president of Washington policy center Inter-American Dialogue told the newspaper. Most people with access to the Net are entrepreneurs with links to the United States, the paper writes.
• The New York Times: Online in Ecuador? It's Taking Awhile (Registration required)