Weekly Digest
Weekly Digest Issue No. 445
11-12-2008
by Deirdre McArdle
Irish broadband figures: not good enough | Tech sector jobs joy | Troubled giants make major cuts | Layoffs begin at Yahoo, CEO search continues | EU to tackle cyberbullying | The little netbook that could
Irish broadband figures: not good enough
In isolation, the latest broadband figures from the Central Statistics Office (CSO) read well enough and indicate continuing growth in broadband uptake in both the residential and business sectors. However, when compared with European figures the Irish broadband penetration rate of 43 percent for households falls well short of the EU27 average of 48 percent. Ireland's percentage total was the same as Lithuania's and 3 percent more than that of Latvia, and a massive 31 percent lower than broadband leaders Denmark and the Netherlands. These comparisons make for sobering reading, particularly when coupled with the news of the delayed National Broadband Scheme, which now won't get up and running for another two years. On a somewhat more positive note, the number of Irish firms connecting to the internet via broadband now stands at 83 percent and is above the European average (81 percent) for the first time ever. In 2007 the percentage of companies using broadband was just 68 percent. Before we get too excited by the figures though, it must be noted that most companies have the option of setting up shop in urban or well-populated areas where broadband access is readily available, and are less likely to establish their business in rural areas of Ireland, which are outside the broadband loop, for at least the next two years.
Tech sector jobs joy
There was good news on the jobs front this week, with tech sector firms around the country creating numerous high-level positions. In Cork, Option Wireless, a manufacturer of devices for wireless internet access, announced it was going to expand its facility there, creating 145 high-quality jobs. Meanwhile, in Dublin, risk management services provider Aon Corporation is to generate 100 skilled jobs as it sets up a 'global centre of excellence'. The new centre will provide "advanced research and development technology", according to Aon. Also in Dublin, software firm Synopsys is expanding its R&D facility in Blanchardstown and recruiting 50 software and electronic engineers. Another software development firm, Sentenial, announced it is to open a new office in Maynooth, Co Kildare, creating 70 new jobs in the process, while in Waterford, call centre firm Rigneydolphin is to recruit 45 new employees following a EUR2 million contract win with Chorus NTL. All in all, it was a good tally for the week, and it seems to indicate that the Irish tech sector will show resilience in the face of the economic downturn.
Troubled giants make major cuts
Meanwhile, on the global stage, two giants in their respective fields announced major jobs purges this week. Japanese consumer electronics goliath Sony announced it is to close five or six factories and cut 8,000 jobs worldwide. The cuts come as Sony outlined its intentions to withdraw from unprofitable businesses and reduce investment in its electronics business by 30 percent. The strategy is aimed at cutting JPY100 billion (USD1.1 billion) in costs in the fiscal year to March 2010. Sony did not say how much the bout of restructuring would cost, prompting commentators to suspect the consumer electronics firm would make a net loss in the current financial year. At the end of October Sony cut its net profit forecast by 38 percent; however, conditions for electronics companies have deteriorated further since then. Meanwhile, telecoms behemoth AT&T has announced it is to slash 12,000 jobs through the end of next year, citing economic pressures, a changing business mix and a more streamlined structure for the decision. Earlier this year AT&T cut 4,600 jobs as part of a reorganisation of its declining landline business.
Layoffs begin at Yahoo, CEO search continues
Wednesday marked the beginning of some 1,500 layoffs at embattled search firm Yahoo, which is currently conducting a little searching of its own -- for a new CEO. The layoffs were announced in October as Yahoo announced plans to slash spending by USD400 million per year. On Wednesday, Brad Williams, a spokesman for Yahoo, announced the closure of offices in Dusseldorf, Hamburg, Stockholm, Amsterdam, Oslo, and Copenhagen, as well as more closures at smaller offices in the US and Asia next year. According to a report in the New York Times, Williams alluded to more job cuts in 2009. "There could be additional staff reductions next year. It depends on the decisions we make about prioritisation, and on things we can't predict in the economy." Of course, these are decisions that a new CEO at the firm would need to get up to speed on pretty quickly. During the week rumours have been circulating about the Yahoo CEO search, with former Vodafone head Arun Sarin featuring in a number of reports. Apparently though, Yahoo's board are still considering several other candidates for the position, and it's possible that new names could emerge in the coming weeks. The general consensus is that Jerry Yang's replacement will not now be announced until January or possibly even February 2009. In the meantime, the search firm is facing renewed pressure to sell its search unit to Microsoft. Ivory Investment Management, which owns 1.5 percent of Yahoo, has written to the board urging it to consider a deal with Ballmer and Co. Selling Yahoo's search business to Microsoft could result in a deal worth twice as much as Yahoo's current stock price, according to Ivory. Yet another thorny issue for any incoming CEO to deal with.
EU to tackle cyberbullying
As cyberbullying becomes more and more prevalent and serious -- consider the now-infamous Lori Drew cyberbullying case in the US -- the EU has stepped in and committed EUR55 million to establish a 'Safer Internet Programme' for kids. In Europe, more than one in every 10 kids using the internet has been bullied, contacted by strangers or encountered sexual or violent images online. And this figure is only going to get more serious, according to the EU, as more and more children regularly go online. And so this Safer Internet Programme, which will get started in 2009, aims to tackle issues such as grooming and bullying by making online software and mobile technologies more sophisticated and secure. One example of the kind of project that will be funded is a network of contact points where the public can report illegal or harmful content and conduct on the web. Meanwhile, here at home, the Government has launched a booklet called 'A guide to cyberbullying', which offers advice on how to identify bullying, how to prevent it and how to respond before things escalate. It seems, however, that Irish parents are somewhat ahead of the curve when it comes to monitoring their kids' online activity. According to an EU survey, 80 percent of Irish parents said they stay close to their children while they are on the net. Over half of Irish kids are not allowed use e-mail or instant messaging and more Irish family PCs have monitoring and/or filtering software than almost any other nationality in the EU. This diligence hasn't stopped incidents from happening though, with 11 percent of Irish parents reporting that their kids have asked them for help because of encounters they have had online. On a positive note, cyberbullying has been brought more into the public consciousness of late and certainly that awareness can only help.
The little netbook that could
In the current tough economic environment, the netbook is perhaps the only bright point in the ailing PC industry. During the third quarter of the year, the netbook market grew by a massive 160 percent, according to a report on the market segment by research firm DisplaySearch. The sheer acceleration of the netbook market is phenomenal: in 2007 the market was less than 1 million units, and DisplaySearch predicts it will reach more than 14 million units by the end of this year. The netbook is typically a small, bare-bones device, similar in look to a notebook, with an average selling price that starts around the EUR300 mark. At this stage most of the top PC manufacturers, with the exception of Apple, have jumped onto the netbook bandwagon, including Dell, Hewlett-Packard and Lenovo. However, it's not the top names that lead this burgeoning sector. Asus, which essentially created the market in 2007 with the Eee PC, holds just over 30 percent market share but was pipped to the post during the third quarter by Acer, which now controls 38 percent of the market. The pair are miles ahead of the nearest competitor, HP, which has a 5.8 percent market share. "Worldwide demand for these products is forecast to grow rapidly over the next few years with demand from a variety of sources, including early adopters, consumer and enterprise PC customers seeking a smaller or secondary notebook PC, as well as new PC customers in emerging markets. We expect the [netbook] market to settle at approximately 16 percent share of the notebook PC market by 2011," said John F. Jacobs, director of notebook market research at DisplaySearch, and author of the report.
Caped Koala Studios has built a virtual world for kids, combining education and social networking 