Weekly Digest
Weekly Digest Issue No. 444
04-12-2008
by Deirdre McArdle
Irish firms strike it lucky in Dubai | Broadband speeds not up to scratch | Mixed week for tech sector jobs | Downturn hits PC market growth | Chip market feeling the heat | EU ministers back cheaper SMS plan
Irish firms strike it lucky in Dubai
A Tanaiste-led Enterprise Ireland trade mission to the United Arab Emirates at the end of November has led to 32 contracts with a total value of EUR40 million being signed by the Irish firms on the trip. In all, 88 companies from a range of sectors including software and telecoms participated in the mission. A spokesperson for Enterprise Ireland told ENN that as well as the contracts signed, a number of meetings were arranged for Irish firms to be introduced to top executives at some of the Gulf region's largest firms. One such meeting saw five Irish mobile software firms introduced to the CEO of UAE's largest mobile operator, Etisalat. "Etisalat is the second fastest growing mobile operator in the world," said the EI spokesperson. "Although no contracts were signed with Etisalat on this particular trip the meeting was an opportunity to show the calibre of Irish companies and could very well pay off in the long term." Though details of the contracts signed haven't been released yet, mobile software firm Ezetop announced it had opened an office in Dubai. The company provides a way for consumers to send mobile phone credit to friends and family wherever they are in the world. Cellusys, Changing Worlds, i-conX Solutions, Newbay Software, Tango Telecom and Zenith Technologies were also among the IT and telecoms firms that made the trip.
Broadband speeds not up to scratch
Broadband consumers across the country are no doubt au fait with the small print on any broadband ad telling them that "broadband speeds may vary". And vary they do, according to a report from internet monitoring firm Epitiro, which reveals that fixed-line broadband customers in Cork, Dublin, Galway and Limerick are on average only receiving speeds up to 60.2 percent of those advertised. Epitiro analysed broadband offerings from six fixed-line providers: BT Ireland, Digiweb, Eircom, Imagine, Perlico and Smart Telecom. The report also tested services from three mobile broadband providers: Three Ireland, Vodafone and O2. Smart Telecom came out tops among all the broadband providers tested, according to Epitiro, followed by BT Ireland and Digiweb. Though mobile broadband users were found to be getting 64 percent of the speeds advertised, the report found that browsing using mobile broadband was "considerably slower" compared to fixed line services advertised at similar speeds. Epitiro's research covered popular broadband activities such as web surfing and downloading music and movies, in a kind of mystery shopper scenario. The dataset used for the report was based on over 5 million tests from August 2008 to October 2008. In a week where it emerged that it'll be almost another two years before the National Broadband Scheme, which Three Ireland won the contract for, will be up and running, opposition politicians outlined their concerns. Labour spokesperson on communications Liz McManus accused the Government of not taking the issue of broadband seriously. Sinn Fein communications spokesperson Martin Ferris called the Epitiro report "only the tip of the iceberg in terms of the poor delivery of broadband across the State".
Mixed week for tech sector jobs
There were mixed fortunes on the jobs front this week with Irish firm Trinity Biotech announcing it was to cut 70 jobs, or 10 percent of its workforce, as it looks to reduce costs. The firm employs around 340 people at its facility in Bray, Co Wicklow, and has a number of manufacturing sites in the US and one in Germany. Trinity Biotech had not replied to ENN for comment on whether Irish jobs would be affected by time of publication. On the flip side, US internet retailer CSN Stores announced it was to set up its European headquarters in Galway with the creation of 200 jobs. The online retailer aims to recruit third level graduates in the areas of IT, software engineering, localisation, finance and multilingual customer support. Meanwhile, Renishaw Ireland, which makes test-probe and measurement systems used in high-precision machining, announced it is to expand its Swords, Dublin operations with a new research and development plant. The expansion will create 60 new jobs, comprising 17 R&D positions and 43 manufacturing posts. Employees at the facility will design and manufacture medical instruments to treat a range of neurological diseases. Finally, electronics retailer Currys announced it was to open a new store in Carlow and create 20 new jobs. This brings to 19 the number of Currys stores around the country.
Downturn hits PC market growth
The ongoing economic slowdown and the decline in consumer spending are expected to take their toll on the PC market until 2010, according to IDC. The research firm has lowered its 2009 estimates for growth in PC shipments to just 3.8 percent, down from a previous forecast of 13.7 percent growth the firm made in the second quarter of this year. IDC has also lowered its outlook for full year 2008 and 2010 by a couple percent each to 12.4 percent and 10.9 percent, respectively. In the short term IDC expects emerging markets such as Latin America, Central Europe, the Middle East and Africa to be most affected by the slowdown. Over the past few years these regions had provided much of the growth in the PC market, but now IDC says Latin America and Central/Eastern Europe will see shipments fall through the third quarter of 2009. While the Middle East and Africa will continue to grow, the pace will be slower than it has been. In the more developed markets of the US and Western Europe, shipments will also take a hit. In 2009 IDC expects shipments to drop by 3 percent in the US market. Meanwhile, in Western Europe, netbooks continue to be a "huge driver", with IDC predicting 2009 growth will be 6 percent, down from over 20 percent for 2008. In summing up the global outlook for the PC market, Loren Loverde, director of IDC's Worldwide Quarterly PC Tracker, said: "Consumer and commercial segments will be much more conservative in their purchases over the coming year or two, and while low prices will remain essential, they will not drive volumes as they did the past few years."
Chip market feeling the heat
The PC industry isn't the only one to feel the effects of the slowing global economy: semiconductor sales declined by 2.4 percent in October, according to the Semiconductor Industry Association. Sales of dynamic random access memory (DRAM) chips fell 14 percent, while NAND flash memory chip sales declined a whopping 41 percent. Excluding memory products, chip sales rose 3.8 percent, said the SIA. As growth slows in both the mobile phone and PC industry, demand for chips has also fallen: PCs and mobile phones make up approximately 60 percent of total semiconductor demand, according to SIA head George Scalise. The slow-off in growth has hit the industry hard; Franco-Italian chipmaker STMicroelectronics has slashed its target for fourth-quarter sales and earnings. It now expects fourth quarter revenue to drop from the previous quarter by between 12.8 to 18.4 percent, compared with a previous target of a decline of up to 8 percent. Also this week Taiwan Semiconductor said its revenues will be below the guidance the company provided a month ago. It now expects revenue of between TWD63 billion and TWD65 billion, down from its previous forecast of TWD69 billion and TWD71 billion. Meanwhile, European chip firm Infineon is bracing itself for a major decline in revenue. It said it now expects sales to drop at least 15 percent in 2009 compared with the previous year. Chip giant Intel also showed that it is not immune to the negative effects of the slowdown. It shocked the market in mid-November with a revenue warning saying it expects fourth quarter revenues of USD9 billion, plus or minus USD300 million, down from an earlier forecast of USD10.1 billion to USD10.9 billion.
EU ministers back cheaper SMS plan
Cheaper texting while abroad took a few steps closer to becoming reality this week as EU ministers backed plans to slash the cost of sending an SMS while on holidays in Europe. The ministers also supported measures that will reform the way in which operators charge for accessing data while roaming. The rules put a retail price cap of EUR0.11 on texts sent while roaming, a significant cut on the current European average of EUR0.29. "The real cost of transmitting an SMS on roaming is less than one cent. I believe there is ample room between one cent and 11 cents, which is the ceiling which will be fixed." said Viviane Reding, EU telecoms commissioner. The ministers also okayed a cap of EUR1 per megabyte on the price of downloading data; this cap applies to the charges operators levy on each other. "Operators will be able to provide 25 to 50 cents per megabyte and we set one euro per megabyte," she said. "Operators have plenty of margin." The proposals need to now pass through the European Parliament, which observers see as merely a formality at this stage. Following approval in the parliament, the new charges will come into effect across Europe in July 2009 -- just in time for the summer holidays.
Caped Koala Studios has built a virtual world for kids, combining education and social networking 