In The Papers 17 September

17-09-2008

by Sylvia Leatham

New job fears as Dell warns of slowing demand | Irish HP staff may be spared worst of cuts

The Irish Times reports that Dublin-based software firm Percana has received a strategic investment from International Financial Data Services Ireland, as reported by ENN on Tuesday.

The paper also says that fresh doubts were cast over the future of Dell's manufacturing plant in Limerick when the PC maker issued a warning about slowing demand and said it would seek to reduce its long-term cost structure. The statement said "the conservatism in IT spending" it had noted when it announced its second-quarter results last month was spreading: "The company is seeing further softening in global end-user demand in the current quarter... The company expects to incur costs as it realigns its business to improve competitiveness, reduce headcount and invest in infrastructure and acquisitions." Speculation has been mounting in recent weeks that Dell will sell its Limerick facility, which employs 3,000 people, to an Asian contract manufacturer.

In other jobs news, the same paper says that Irish staff at Hewlett-Packard may be spared the worst of the cost-cutting which will see 7.5 percent of its global workforce offered severance packages. The cutbacks are part of HP's integration of EDS, the IT services company it acquired earlier this year. On Tuesday afternoon, sources close to the company said the impact was likely to be felt in HP but was "more likely to impact on the EDS side". HP employs about 4,000 people on the island of Ireland in six different business units.

The Irish Independent reports that mobile handset giant Nokia saw its operating profit in Ireland rise nearly 37 percent in 2007 to EUR5.86 million, as sales from continuing operations jumped more than 15 percent to EUR251.4 million. New accounts just filed for the company reveal that the Irish subsidiary also paid an EUR11 million dividend to its Finnish parent last year, down from EUR13.5 million in 2006.

The paper also notes that shares in Australian investment group Babcock & Brown plummeted 33 percent on Tuesday, despite its assurances to investors that it had no exposure to the collapse of US banking giant Lehman Brothers. The stock had hit a historic low on Monday, but Tuesday's slump took the stock down further. Babcock & Brown owns 8 percent of Eircom, while its listed Babcock & Brown Capital fund owns 57.1 percent of the Irish telecoms firm.

The Irish Examiner reports that farmers planning to buy cattle can now view the livestock online. Entrepreneurs Donall O'Connor and Michael O'Donnell, the founders of www.pedigreecattle.ie, say the initiative is the first of its kind in Ireland. O'Connor said primary research identified that one of the main complaints farmers have when searching for livestock is that they have to spend valuable time, often several days, travelling to view stock. "Often when they reach the destination, the animals are not as expected and the time is wasted. Now farmers can go online and view the stock available in Ireland and Britain." In time, it is envisaged that the website will become a social networking platform for farmers and breeders.

The paper also reports that the head of software giant Microsoft Ireland has said that all students and teachers need access to the latest technology if young people are to meet the challenges of the 21st century. Paul Rellis was speaking at a conference organised by employers' body IBEC, where he called for a debate on how to deliver a new method of professional development for teachers and an assessment system with digital technology at its centre.

According to the Wall Street Journal, Samsung Electronics has made public an offer to buy storage card maker SanDisk for USD5.8 billion in cash, after lengthy private talks between the companies failed to produce an agreement. SanDisk rejected the offer, saying it "undervalues" SanDisk and constitutes an "opportunistic attempt" to take advantage of the company's depressed stock price. The proposed purchase would be the most costly ever attempted by Samsung, as well as the largest foreign purchase by a South Korean company.

The Financial Times says that the technology industry's downturn will last until the end of 2009, according to suppliers of components used in almost every electronic product. Japanese groups such as TDK, Kyocera, Murata Manufacturing and Nichicon, which dominate global markets for components such as capacitors and inductors, report heavy pressure on prices because high-end components are not selling. "This year and next will both be tough. It is one of the worst markets I have seen," an executive of one of the largest component makers said. That implies hard times for mobile handset makers such as Nokia, PC companies such as Dell, and consumer electronics producers such as Sony and Panasonic.

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