Microsoft has scooped up Palo Alto, Calif-based Lookout Inc., a small e-mail search company, as part of its plan to bolster its search tools business. "The acquisition could give a boost to Microsoft's plans to become more competitive in search technology, a field that is increasingly important in online commerce. The rise of Google Inc., which has turned Internet search into a lucrative service, has prompted a host of companies, including Microsoft, to redouble their efforts in the field," the Wall Street Journal reported.
The Los Angeles Times said Lookout is a "two-employee company, which sells a program that hunts for specific words in e-mail, documents and other files on the PC, will be folded into Microsoft's MSN online service. Microsoft is investing heavily to develop an Internet search engine to compete against those offered by Google Inc. and Yahoo Inc. But Google and Yahoo also are moving into Microsoft's turf; both companies have plans to offer search engines that can find information on the PC desktop that Microsoft dominates with its ubiquitous Windows operating system."
Microsoft is readying a new technology that could give Apple a run for its money in the digital music market, the Wall Street Journal reported today. "The Microsoft technology is likely to be the first in a series of more vigorous challenges to Apple's position in the music market, including a raft of new audio and video gadgets due out by Christmas that will compete with Apple's hit iPod music player. Microsoft itself plans to compete directly with Apple's iTunes Music Store through a music retail Web site expected from its MSN division as early as the fall," the article said. "Microsoft's greatest impact on the market, though, may come with the release of the new version of its widely used software for preventing music piracy, called Windows Media Digital Rights Management. One of the most intriguing uses of the technology better known inside the industry by its code-name, Janus is that it will let subscribers to music-rental services, for the first time, transfer their song collections from their PCs directly to portable audio players. That capability has been a key missing feature of such services."
The Wall Street Journal: Apple's iPod May Meet Its Match In New Microsoft System (Subscription required)
Chilling out With IBM
IBM reported a quarterly profit yesterday, giving "a modest dose of steadying reassurance yesterday to a shaky technology sector," the New York Times reported. "I.B.M., like other technology suppliers, did notice a pause in corporate buying at the end of the second quarter, especially in its software business. But [Mark Loughridge, the chief financial officer], in a conference call with securities analysts, said that he regarded the pause as a temporary setback and added that deferrals of purchasing would probably become selling opportunities in the current quarter," the article said.
In other good news for the technology sector, Dell gave Wall Street a solid earnings forecast in advance of its annual earnings meeting today. Dell raised its earnings-per-share guidance by 2 cents to 31 cents, "citing 'robust' enterprise systems and services sales and market-share gains outside the U.S... Wall Street expects the computer designer to earn 29 cents a share for the latest second quarter, according to a consensus estimate produced by Thomson First Call," the Wall Street Journal reported. Today also marks the day the Dell founder and chief executive Michael Dell hands over his post to a new CEO, a change announced this spring, CNET's News.com reported.
The Wall Street Journal: Dell Raises Second-Quarter Outlook, Citing Overseas Market-Share Gains (Subscription required)
CNET's News.com: Rollins To Take Up The Reins At Dell
...While the Valley Sees No Sun
The cover story of the latest issue of Business Week covers the financial woes at Sun Microsystems. An excerpt: "Sun's sales have tumbled 48% in the past three years, it has lost a third of its market share and it continues to head south even as its rivals ride the economic recovery. Its stock, which reached $64 in 2000, trades at about $4. No other major player has been weakened as much during the tech downturn. 'Right now it looks pretty grim,' says Geoffrey A. Moore, author of several tech-industry books, including Crossing the Chasm."
Business Week: Sun: A CEO's Last Stand
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