Filter looks at the day's top technology news through snapshots and analysis of what the world's media outlets are covering. Washingtonpost.com's new Mon.-Fri. feature is penned by technology reporter Cynthia L. Webb. If a technology story breaks, a company falters or triumphs, or there's a new trend in technology, Filter wants you to know about it.
"For Apple to be up in after-hours trading in what is a horrible week for tech stocks shows the market's belief that Apple is far from the dust bin," Peter Kastner, an Aberdeen Group analyst, told the San Jose Mercury News.
• San Jose Mercury News: Music Proves Fruitful For Apple (Registration required)
Positive Tech Signs, Part II
Intel rival Advanced Micro Deviceslogged another profitable quarter thanks to brisk sales of flash-memory chips. "But the company, a perennial underdog to Intel Corp., faces the prospect of tougher competition from the market leader. Intel on Tuesday said it is regaining market share in flash chips and could put more pressure on AMD by slashing prices on those products as well as on microprocessor chips. AMD, based in Sunnyvale, Calif., reported net income for the period ended June 27 of $32.2 million, or nine cents a share, compared with a loss of $140.1 million, or 40 cents a share, a year earlier. Sales rose to $1.26 billion from $645 million," the Wall Street Journal reported. "The company didn't give a specific prediction for its business in the current quarter, but said it expects sales to increase in each of its two major businesses – flash memory and microprocessors – and total sales to increase 'moderately.'"
The Associated Press noted that "AMD suffered massive losses during the tech downturn and returned to profitability just last year as the economy rebounded. It also revamped its microprocessor lines and formed a flash memory joint venture with Fujitsu. Like Intel, AMD highlighted strong gains in flash memory. The business posted record second-quarter sales of $673 million, up 220 percent from the same period a year ago. It generated $45 million in operating income."
• The Wall Street Journal: AMD Reached Quarterly Profit On Sales of Flash-Memory Chips (Subscription required)
• Associated Press via the San Jose Mercury News: AMD Turns In Strong Third Quarter (Registration required)
Meanwhile, cell phone maker Nokiaalso posted a rise in net income. But this is not enough to keep Wall Street appeased in leaner tech times. "Nokia Corp. reported a 14% rise in second-quarter net profit, but sales weakened and the world's largest maker of mobile phones forecast lower third-quarter profit and sales as it reduces prices in the face of stiff competition. It shares dropped Thursday, falling 15% in Helsinki trading. Its shares were also expected to open sharply lower in New York," Dow Jones Newswires reported.
• Dow Jones Newswires via the Wall Street Journal: Nokia's Net Rises 14% But Outlook Is Weak (Subscription required)
What, Me Worry?
Despite a slew of profit warnings from some major tech players in the past week, Oracle's chief executive Larry Ellison and his posse are staying bullish on the sector. "Oracle Corp. executives said Wednesday that their company wasn't suffering the sales shortfalls cited by some software industry rivals last week, and Chief Executive Larry Ellison cited the spate of profit warnings as vindicating his predictions of imminent consolidation," the Los Angeles Times reported. "Please don't print it, but I'd like to say, 'I told you so,'" Ellison said. "The idea that we need all these different software companies is a very bizarre idea."
The San Jose Mercury News had a slightly different take on Ellison's remarks. "Please don't groan, but I'd like to say 'I told you so,' " Ellison said. "The idea that we need all these different software companies is very bizarre. All these other industries have consolidated, but software will have thousands of different companies? ... It's a mad idea." The LATimes continued: "Faced with slowing growth and competition from IBM Corp. and Microsoft Corp. in its core database business, Oracle has changed its strategy and started trying to acquire other companies."
• Los Angeles Times: Oracle Upbeat Despite Sector's Profit Warnings (Registration required)
• San Jose Mercury News: Oracle Shopping in the Valley (Registration required)
On the acquisition front, CNET's News.com reported that Ellison joked: "Being in Silicon Valley, we will have the opportunity to buy a lot of companies, some of which are in Silicon Valley and run by former Oracle people – and it's not the one in the East Bay." CNET noted Pleasanton, Calif.-based PeopleSoft – the target of a hostile (to say the least) Oracle acquisition – is located in that region.
• CNET's News.com: Ellison Upbeat On Oracle Growth
The Business of Messaging
After years of marching to their own messaging software, America Online, Yahoo and Microsoft's MSN will allow corporate instant messaing users to talk to each other. The deal is "the first major step by the industry leaders to enable computer users to communicate with one another no matter which of the three systems they use," The Washington Post reported. "In an announcement planned for today, the triumvirate will outline a new partnership aimed at spurring greater use of instant messaging at work by tearing down the electronic walls that keep the respective networks separate. To use the new system, companies will have to license new Microsoft network software that will serve as the hub connecting messaging systems operated separately by AOL, Microsoft's MSN division and Yahoo." The paper also noted that the "three companies have no plans to permit users outside the workplace to communicate with one another over different instant message systems."
• The Washington Post: AOL, Yahoo and MSN To Integrate Messaging (Registration required)
CNET's News.com explained more: "Microsoft will pay AOL and Yahoo a royalty for connecting to" Microsoft's Live Communications Server. "The companies declined to elaborate on whether these payments will be based on the number of LCS users connecting to AOL and Yahoo. The connections will be based on direct links between LCS and AOL and Yahoo's IM servers, which means LCS users will see their Yahoo, AOL and MSN buddy lists appear when they log on and be able to instant message their contacts. LCS users will not get the same features as the public AOL or Yahoo clients, such as unique emoticons or gaming perks."
• CNET's News.com: IM Giants Drop Some Barriers To Peace
Reuters said "businesses have been reluctant to implement or approve the use of instant messaging in the workplace due to fears that such systems could lead to security breaches or abused by employees. Representatives from Microsoft, Yahoo and AOL, a unit of Time Warner Inc., said that businesses have been asking for messaging systems that could be implemented in the workplace, and said they see opportunity for growth in this area."
• Reuters: Microsoft Opens Messaging Service To AOL, Yahoo
