SNO process takes a step forward?

Motorola`s proposed spin-off of its chip business and the revelations at Computer Associates dominated the international world of IT and telecommunications last week.

Watching Microsoft be sued by the US federal government, European Commission, class-action plaintiffs and aggrieved rivals has become a common pastime in our industry.

Paul Booth, MD, Global Research Partners

At home, the Altech/NamITech situation, Nedcor`s disposal of its Dimension Data shareholding and the news that the second national operator (SNO) process should start moving forward this week stole much of the local ICT headline space.

* we saw mediocre interim numbers from Altech (revenue down and attributable earnings well down) and Datacentrix (revenue and profit both a little down);

* an interim loss from Global Technology (revenue also well down); and

* negative profit warnings from Datatec, EC-Hold, MGX and Spescom Software (formerly Altris Software and Spescom`s US arm).

Other local news included:

* Bill Venter was appointed as chairman of Bytes Technology Group;

* Sybrand Grobbelaar retired as MD of Grintek;

* the announcement of significant retrenchments at CS Holdings;

* a delay in the MGX disposals timetable;

* AST`s announcement that only 63.07% of the shares on offer via its rights issue had been taken up through this current offer;

* the hiccup in Altech`s acquisition of NamITech following the Competition Commission`s recommendation that the merger be prohibited;

* Nedcor`s disposal of all its remaining shares in Dimension Data; and

* the indication that the government`s decision on a controlling shareholder for the SNO could come this week.

New local distributorships included that of Ethniks Systems Group for Scala Broadcast Multimedia, Grintek Telecom for Hughes Network Systems and Leaf Wireless for Falcom Twist.

* Motorola announced it would spin-off its chip-making entity as a separate business that would be publicly traded;

* the alliance between Fujitsu and Siemens re the provision of global computer services;

* Computer Associates had discovered evidence of improper revenue reporting and had asked its CFO and other executives to resign;

* Reuters plans to reduce its stake in Tibco Software;

* Philips Electronics has started the process to cut its stake in Taiwan Semiconductor;

* Singapore Technologies Telemedia had won approval to take a majority stake in bankrupt Global Crossing; and

* AT&T Wireless has sold off its $330 million stake in Taiwan`s Far EasTone.

Additionally, look out for the winner of the bid for Inmarsat.

Other international news included:

* the appointments of Kenneth Dahlberg as CEO of SAIC, Les Pilkington as chairman and CEO of Secure Blue, West McDonald as president and CEO of ZooLink, Steve Rowley as CEO of Anite, and David Talbot as CEO of Salon Media Group;

* the resignations of Robert Beyster as chairman and CEO of SAIC, and Michael O`Donnell as CEO of Salon Media Group; and

* a job loss announcement from Borland.

We saw excellent* figures from Sonus Networks (back in the black), and very good* numbers from Taiwan Semiconductor and Yahoo.

Good figures* were recorded by Accenture, Infosys Technologies, Juniper Networks (back in the black) and UMC; and satisfactory* ones by Specialist Computer Holdings, Staffware and Symbol Technologies.

Mediocre* returns came from Inforte, while very poor results* came from Angoss Software (but back in the black).

Losses* were posted by Argonaut, ARI, Aware, Charteris, DynTek, ESI, Handspring, Metron, Oce NV, Printronix, Proginet, SYS Technologies, Tikcro Technologies and Workstream.

Other financial news included analyst upgrades for Brocade Comms, Lexmark, Netgear and SAP AG; analyst downgrades for Lexar Media, Micron Technology and Motorola; share buy-back announcements from Cognos, Telefonica and Telstra; positive results/profit warnings from Autonomy, Bell Microproducts, Casio, Infosys Technologies, KDDI, PeopleSoft, SAP, ScanSource, SeeBeyond, Silicon Graphics and Terayon Comms; and negative results/profit warnings (often veiled) from ARC International, ATMI, Borland, Carphone Warehouse, Catapult Comms, Compuware, CSG Systems, Entrust, Firstwave Technologies, LookSmart, Pinnacle Systems, Symbol Technologies, Quantum, VocalTec and XO Comms.

There were also share split announcements from Kronos, Open Text and Openwave (reverse) and a very good IPO from DigitalNet Holdings.

Locally

Aplitec (+11.3%)
AST (-15.4%)
Dimension Data (+22.3%)
Global Technology (+25%)
Intervid (-15%)
Jasco (+12.5%)
Maxtec (+100%)
Sethold (-16.7%)
Telkom (+10.9%)
Zaptronix (+33.3%)

Internationally

Allegiance Telecom (-28%)
Aspen Technology (+33.8%)
DDi (+30.4%)
Internet America (+36.4%)
Leap Wireless International (-37.5%)
Micro Component Technology (+42.9%)
Plasmon (+27.2%)
Rambus (+40.6%)
SGI (+29.8%)
Terayon Comms (+28.3%)

In terms of indices, Nasdaq was up 1.8% and the JSE up 4.2% for the week.

Watching Microsoft be sued by the US federal government, European Commission, class-action plaintiffs and aggrieved rivals has become a common pastime in our industry.

However, Microsoft recently suffered a significant setback in a patent-infringement case when a federal jury awarded $521 million to a former University of California researcher, but unlike previous occasions, this time the industry is not smiling.

To comply with this court ruling, Microsoft has informed a handful of software companies and the World Wide Web Consortium that it will probably make changes in its Internet browser, the gateway to the Web for the majority of computer users. The impact, according to industry executives and Web experts, could be disruptive and costly for other Internet software companies and big commercial Web sites. Although Microsoft is appealing this decision, it is not likely to sit and do nothing during the interim period, which could be 18 months.

* NB

'Guidelines` for the categorisation of results is as follows and is always in comparison with the equivalent period for the previous year; pro forma numbers are ignored (the terminology may vary slightly from country to country).

* Excellent: Both revenue and net income growth is in excess of 50%.

* Very Good: Both revenue and net income growth is in excess of 25%

* Good: Both revenue and net income growth is in excess of 10%.

* Satisfactory: Revenue is within 10% of previous year and net income is up.

* Mediocre: Either revenue and/or net income is down.

* Very poor: Net income is less than 1% of revenue.