Weekly Digest
Weekly Digest Issue No. 438
23-10-2008
by Deirdre McArdle
Jobs joy for Mid West | Full systems go at Heavey RF | Infrastructure upgrade key for broadband market | BT links up with Tyndall | Yahoo and Google: poles apart | Tech firms tread softly with Q4 estimates
Jobs joy for Mid West
Amid all the post-Budget doom and gloom, the Mid West region had something to smile about this week with the news that three companies are to create over 200 new jobs in the area. Microsemi, a US-owned firm that produces equipment for America's space exploration programme, has plans to increase its Ennis-based workforce by 185 over the next two years. The jobs have not been officially announced just yet, but Richard Finn, the firm's general manager, has made a submission to the Clare County Council seeking additional facilities as Microsemi increases its workforce "from 215 people to 400 people over the next two years". It was just last May that Microsemi reversed a decision to phase out its operations in Ennis. At that time the firm employed 108 people. Also in the Mid West, Async Technologies, which is based in Clare, said it would be creating 11 highly-skilled jobs, while Limerick-based Avvio is poised to create 30 skilled roles over the next two years. Together, these two firms will invest EUR4 million in their expansions. Async produces a tyre management technology called 'Tyre–Check', while Avvio provides reservations software and online marketing to the hospitality industry.
Full systems go at Heavey RF
Someone else with reason to smile this week was Dublin IT firm Heavey RF, which has picked up a lucrative six figure deal with global logistics firm DSV. Under the agreement, Heavey RF rolled out a voice enabled warehouse management solution to replace DSV's paper-based system. The new system means electronic orders are automatically converted to speech which are directed to the warehouse staff using wireless technology provided by Heavey RF. Heavey RF develops the software applications locally in Ireland. DSV said it chose Heavey RF due to the Irish firm's "impressive track record" with similar solutions with some of the leading retailers and wholesalers in the country including Musgraves, BWG, Londis and Superquinn. Ciaran Lavelle, sales manager with Heavey RF, said the firm is currently growing both its product range and its workforce. "We are currently in the process of recruiting new staff as we continue to expand," Lavelle told ENN. "We started 2006 with just seven staff and we aim to have 20 employees by the end of the year." Lavelle also said that the company is well on track to record turnover of EUR5 million for the year, a 20 percent rise on last year's figure of EUR4.1 million.
Infrastructure upgrade key for broadband market
As Europe moves into the next generation of broadband, upgrading our existing infrastructure is key if Ireland is to keep up. According to Tommy McCabe, director of IBEC's Telecommunications and Internet Federation (TIF), the telecoms industry is expected to invest EUR724 million per year in infrastructure over the period 2007 to 2011. The investment will be spread across all platforms, including fixed, mobile, wireless, fixed wireless, satellite and cable infrastructure. With over 1 million broadband subscribers in the country, penetration growth is on the up. The broadband issue in Ireland has, for the most part, moved on to the available speeds and quality of broadband, according to TIF Chairman and Director of Strategy, Vodafone Ireland, Gerry Fahy. "While extensive broadband coverage is necessary, it is not sufficient if Ireland wants to compete with the best in Europe. Speeds of 50-100 Mbps need to be made available to every home and business across the entire country," he said in a statement. Fahy indicated that whilst estimates vary as to the cost of providing this, it is likely to be around EUR2 billion to EUR4 billion, an investment he said will not be achieved through private sector funding alone. "There is a need to develop public private partnerships (PPPs) that will ensure this objective is achieved in a way that supports rather than distorts market forces," said Fahy. McCabe and Fahy were speaking at TIF's annual conference in Dublin Castle on Tuesday.
BT links up with Tyndall
One telecoms firm that is fostering such links with the public sector is BT, which has announced it is to partner with Tyndall Institute at University College Cork to conduct research and development (R&D) into advanced optical networks. The aim of the partnership is to find solutions that will enable more information to be sent over greater distances. As part of the collaboration BT has provided access to network infrastructure comprising nearly 900km of optical fibre. This means that Tyndall's photonics research can be trialled in a real environment outside of the lab. The optical fibre, which is looped between the Photonics Systems Laboratory at the Tyndall Institute in Cork City and Clonakilty in West Cork, is being used for trials of photonic techniques to transport optical data at extremely high bit-rates over extended distances across telecommunication networks. "[This] is the type of public private partnership that will help deliver on the Irish Government's ambition to be internationally renowned for the excellence of its research," said Chris Clark, CEO, BT, in a statement. "We are delighted to support Tyndall in one of the most exciting areas of network development."
Yahoo and Google: poles apart
Both Yahoo and Google released their quarterly earnings during the week, and while Google continued to grow, Yahoo's fortunes appear to be plummeting. The search firm saw third-quarter profit plunge 64 percent, from USD151.3 million, or USD0.11 a share, in 2007, to USD54.3 million, or USD0.04 a share. Revenue meanwhile, increased by just 1.1 percent to USD1.79 billion. Yahoo said its results were dragged down by a continued weakness in display ads, one of the company's most important revenue streams. The troubled firm also announced a new batch of layoffs. It is planning on cutting 10 percent of its global workforce, which will amount to at least 1,500 of Yahoo's roughly 15,000 full-time employees. On the flip side, Google posted a 26 percent jump in profit, as well as a 31 percent increase in third-quarter revenue. While the internet giant did report continuing growth, it's clear that this growth is slowing off; in the previous quarter, profit was up 35 percent and revenue increased by 39 percent. The fourth quarter will be an interesting one for both Yahoo and Google as well as the online advertising market, which is beginning to slow off slightly. It's likely that both firms will feel the impact of a slowing online advertising market, though Google's stronger market position and its recent diversification beyond internet advertising means it'll be less shaken than Yahoo.
Tech firms tread softly with Q4 estimates
As quarterly results were announced thick and fast this week, analysts were waiting in anticipation to see how the current economic slowdown is taking its toll on the technology industry. Apple, whose results were being watched carefully as an indication of slowing consumer spending, came out of the stable rearing to go. Strong sales of the iPhone (6.9 million iPhone 3Gs were sold in the three months since its launch) helped Apple to record a 26 percent jump in profit for the quarter. Revenue too was up from USD6.2 billion in 2007 to USD7.9 billion. Though the results did much to cheer Wall Street, Apple did lower its forecast for the fourth quarter with Steve Jobs admitting that the company doesn't yet know how it will be affected by the downturn. For the next quarter Apple expects to post earnings between USD1.06 and USD1.35 a share on revenue between USD9 billion and USD10 billion. In the fourth quarter last year it earned USD1.76 a share on USD9.6 billion in revenue. Meanwhile, online retailing giant Amazon also issued a cautious projection ahead of the key holiday season, despite a relatively healthy third quarter performance. The e-tailer posted a 48 percent increase in profit and a 31 percent revenue jump; however in its full-year forecast it said it expects sales of USD18.46 billion to USD19.46 billion, down from its previous forecasted range of USD19.35 billion to USD20.1 billion. Another tech behemoth, Sun Microsystems, seemed more of a harbinger of doom as it warned of a deep quarterly loss and a possible charge for the diminished value of acquisitions. Analysts said Sun's projection adds up to a quarterly loss of between USD185 million and USD260 million. All told, the upcoming quarter looks like it could be a crucial one with many tech firms treading softly, softly with their estimates. Watch this space.
Caped Koala Studios has built a virtual world for kids, combining education and social networking 