Weekly Digest
Weekly Digest Issue No. 448
15-01-2009
by Deirdre McArdle
Ireland gets good news from Japan | Yahoo names new CEO | Apple's Jobs to take medical leave | Nortel files for bankruptcy, CEO upbeat | Digicel announces job cuts
Ireland gets good news from Japan
A healthy dose of good news came from Japan this week, where Taoiseach Brian Cowen is currently leading a Government trade mission. Two Japanese firms are to create 150 jobs in Ireland between them. Gala, an online gaming company, is to expand its European headquarters in the Digital Hub and create 50 jobs, doubling its Irish workforce. The firm said growth in the online games market and the success of the Irish operation to date were behind its decision to expand. Meanwhile, online security firm Trend plans to establish a new European anti-malware service, which will support TrendLabs' global threat research, at its Cork operation. It will increase its Cork-based workforce by 70 percent, hiring 100 people over the coming three years. As well as the jobs news, the Taoiseach announced a number of research and development investments by Japanese firms in Ireland. Alps Electric, which manufactures electronic components, is to establish a design team at its Irish operations that will focus on developing new technology into the European automotive market. The firm's Irish operations are based in Millstreet in Cork where it employs over 400 people. In addition, medical equipment manufacturer Shimadzu announced it will be working with The Applied Optics Group in NUI Galway in the area of imaging techniques. A USD5 million investment in Firecomms was also unveiled. The Taoiseach also mentioned the joint R&D initiative between Sony, IBM and Toshiba, which is based at Trinity College Dublin's Graphics, Vision and Visualisation (GV2) Research Group, which was announced late last year. All in all, the trade mission has been a successful one for the Government's knowledge society dream. The Taoiseach said the announcements signal Ireland's "intent to the international scientific community and knowledge-based industry that Ireland is very much open for business".
Yahoo names new CEO
Some two months after Jerry Yang vacated the top spot at Yahoo, the search firm has finally named its new CEO, selecting tough-talking tech veteran Carol Bartz to jump into Yang's shoes. Bartz joins Yahoo from software firm Autodesk, where she has been executive chairman for the past two years, after stepping down as CEO in 2006 after 14 years in the top job. Over the years, Bartz has also held senior roles at Sun Microsystems, Digital Equipment Corporation and 3M. She has been credited with turning around the fortunes of Autodesk, which was in a similar place to where Yahoo is now when she joined in 1992. During her time at Autodesk revenues increased from less than USD300 million to over USD1.5 billion, and the company's share price increased nearly ten-fold. Just after news of her appointment leaked, Bartz, along with Yahoo chairman Roy Boystock, held a short conference call with the press. Boysotck told journalists that Bartz was the "only person to whom we offered the job" and said her "energetic and decisive leadership style" was exactly what Yahoo needed to get back on track. Boysotck also announced that Sue Decker, whom many had tipped for the top position, would be leaving Yahoo to pursue other interests. For her part Bartz seems to have made an early impression on industry commentators: during the call, when asked about future plans, she reportedly told journalists to give Yahoo "some friggin' breathing room" and noted that the company "frankly, could use a little management". In general, industry consensus appears to be that Bartz's appointment is safe, but not overly exciting. Given the current tough climate and particularly rocky road Yahoo has to navigate, maybe safe and steady is exactly what the search firm needs, for now.
Apple's Jobs to take medical leave
Speculation all over the blogosphere and the wires Thursday morning centred on Apple and how it's going to cope following the announcement late on Wednesday that Steve Jobs is to take medical leave until at least June 2009. Earlier this month Jobs had spoken out about his health problems, saying that he had an easily treatable hormone imbalance and that he would be staying on at the helm of Apple. It now turns out that his illness is "more complex" than at first thought. Apple is being its usual tight-lipped self though and is not giving away any further information aside from Jobs saying he will remain involved in "major strategic decisions". He is handing over the reins to the competent Tim Cook, chief operating officer at Apple, who also stepped up to the plate in 2004 while Jobs recovered from surgery for pancreatic cancer. While Cook is widely considered to be well capable of running Apple day-to-day, Jobs' creative genius and brainstorming chops mean his shoes are very difficult ones to fill. A number of analysts though have indicated that a Job-less Apple may not crumble, and that there are plenty of innovative executives in the background at the firm. However, investors and Wall Street don't appear so confident, with Apple shares plummeting almost 10 percent on Wednesday in after-hours trading on the Nasdaq.
Nortel files for bankruptcy, CEO upbeat
Telecoms equipment giant Nortel filed for Chapter 11 bankruptcy protection on Wednesday, just a day before it was due to make a large bond interest payment of around USD107 million. According to the court filing in Delaware, the Toronto-based firm owes bondholders more than USD3.8 billion. In the past year or so Nortel has been hit by a severe drop-off in demand for its telecoms network equipment, and has been facing intense pressure from rivals such as French-US giant Alcatel-Lucent, as well as Huawei Technologies. While its problems had started well before the global downturn, the changes in the world's economic environment no doubt intensified its misery. In November the firm announced cost-cutting measures including 1,300 job cuts as it struggled to get control of its plummeting profits and share price. On 10 December it was reported that Nortel had sought legal counsel to explore bankruptcy-court protection from creditors in the event that its restructuring plan failed. At that time a spokesman for Nortel said that "no bankruptcy filing is imminent" but added that the company had engaged advisers to help it chart a way forward. In mid-December the Canadian firm was warned by the New York Stock Exchange that it had six months to bring its share price back up to the USD1 minimum for listing, otherwise it would face delisting; at that time its share price was wallowing at USD0.32. For now, Nortel, which employs 300 people in Galway, has said that "normal day-to-day operations are expected to continue without interruption". Apparently the company still has "sufficient cash in hand" to support continuing operations. Nortel president and CEO Mike Zafirovski had an upbeat tone in the company's statement, saying that the bankruptcy filing was "imperative" to get Nortel back on track. We'll have to wait and see how that pans out.
Digicel announces job cuts
After years of blistering growth Denis O'Brien's Caribbean mobile operator has announced it is to cut 10 percent of its workforce in the region. The 450 redundancies, or 'voluntary separations', as Digicel calls them, will take place by the end of February and form part of a major cost-cutting exercise by the fast-growing operator. The job losses will affect 23 of Digicel's 31-market operations and will mainly focus on the Caribbean region. The mobile operator has most recently been expanding in the Central American and South Pacific regions, and these newer Digicel markets will not be affected by the move. For its part Digicel said the job cuts are not a reflection of a downturn in the business or its subscriber base, but that the firm was at "a natural stage in our evolution to reassess our organisational structure, processes and to fully capture operational efficiencies," said Colm Delves, Digicel Group CEO. O'Brien launched Digicel in 2001, and at its year end in March 2008 it had 6.54 million customers in 26 countries in the Caribbean and Central American regions. Through its subsidiary, Digicel Pacific, it also operates in five countries in the South Pacific.
Caped Koala Studios has built a virtual world for kids, combining education and social networking 