Weekly Digest
Weekly Digest Issue No. 452
12-02-2009
by Deirdre McArdle
Bright spots shine through grey skies | Dell cuts continue to take toll | Plot thickens in digital book market | Irish consumers think mobiles are GR8 | Sites combine to make net safer
Bright spots shine through grey skies
Two Munster-based firms emerged from all the doom and gloom this week with a couple of announcements that should bring some measure of cheer to the region. Limerick-based AMCS, which provides technology to the waste and recycling industry, announced it had raised EUR5.25 million in funding. The firm, which employs 50 engineers and technical staff, said it will use the money to double its workforce by next year. The investment will also help the firm expand into overseas markets and boost its product range. The funding is being provided by British-based cleantech fund WHEB Ventures, which led the funding round, and the Ulster Bank Diageo Venture Fund, managed by NCB Ventures in Dublin. Meanwhile, Kerry-based financial services firm Fexco hit the headlines when it announced its money transfer unit has been snapped up by Western Union for a whopping USD159.5 million, according to reports. The US-based money transfer giant bought a 25 percent interest in Fexco in 2001, but will hand over its stake in Fexco's other businesses as part of the new deal. Fexco was founded in 1981 and it has 930 employees in Ireland, 785 of which are based in Kerry. Around 300 Fexco workers are expected to become part of Western Union when the purchase is completed later this year.
Dell cuts continue to take toll
Over a month after the news that 1,900 jobs would be lost at Dell's manufacturing facility in Limerick, the first meeting has taken place of a taskforce set up to help the workers who lost their jobs. Former chief executive of Kerry Group Denis Brosnan, who heads up the taskforce, has called the Dell job cuts a "wake-up call" for the Government to recognise the ongoing economic decline of the west of Ireland. Over the coming months, Brosnan said the taskforce will meet twice a month and will compile an interim report for the Government within three months, followed by a full list of recommendations by 2010. Also this week, as had been widely expected, the Dell job cuts started to affect Limerick businesses who supplied Dell with various services. According to reports Banta RR Donnelly has commenced layoff talks with almost 500 workers at the company, whose sole customer is Dell. Although Banta hasn't commented on the reports, workers say they will be let go in tandem with the Dell layoffs, which will commence in April. Banta boxes Dell computers and accessories. It has built a new plant adjacent to the new Dell facility in Lodz, Poland, which will take over the Limerick assembly line work. There was a little tidbit of good news this week when Dell announced an improved redundancy package for the workers due to be laid off. Under the revised package staff will receive six weeks' pay for every year of service, capped at 104 weeks, compared to the previous offer of a cap of 52 weeks. Workers also now have the option of having their shift allowance included in their package or of taking an alternative option of having six months of health and life insurance paid for by the firm.
Plot thickens in digital book market
The e-book market turned another page this week with two new developments that could invigorate the sector. Amazon, which pioneered the e-reader device with the Kindle in November 2007, on Monday launched an updated version of the gadget, the Kindle 2. It's a slimmer, sleeker device than its predecessor, with better capacity (1,500 titles as opposed to 200+ titles), improved battery power and new features such as the option to have the book read aloud to you. However, the online retailer's decision not to drop the price on the device has drawn some criticism from analysts who think the USD359 price tag could be a hurdle to mass adoption. Another hurdle cropped up during the week with the news that Google had adapted its Book Search site for the Apple iPhone and for its own Android mobile platform. The internet behemoth has digitised some 1.5 million of the world's books and featured them on its Book Search site, which is available to computer users. Now it's modified the PDF scans of these books to suit the smaller screen of a mobile phone. These two developments have sparked discussions about which is the better option and which will make an impact on this nascent market -- the Kindle or the iPhone? In the red corner you have a purpose-built digital book reader, which does its best to replicate the 'look' of a book. In the blue corner you have a mobile phone. However, where Google's Book Search for the iPhone delivers the body blow is that its books are available for free, and there's 1.5 million to choose from, compared to 230,000 titles available for the Kindle at around the USD9.99 mark each. It's a little early to name a champ in this particular fight, but it'll be interesting to see how many rounds it'll go.
Irish consumers think mobiles are GR8
The mobile phone continues to play a major role in Irish consumers' lives, with 45 percent of people saying it is the communications device they couldn't live without. That's according to a ComReg survey, which revealed that just 10 percent of people felt the same way about the internet. When asked what their preferred method of communication was, over half (56 percent) said face-to-face communication, while 21 percent favour the mobile phone, and just 12 percent said the fixed-line phone. Ownership of a mobile phone is pretty much universal at this stage with 93 percent of people saying they have one. However, the average monthly phone bill for mobile users has been dropping steadily over the past two years or so; consumers are now spending on average EUR41.64 compared to EUR55.91 in the fourth quarter of 2006. While increased competition and better value packages are playing a large role in this shift, the jump in the number of consumers opting for pre-pay instead of bill-pay could also have something to do with the drop in spending: according to the survey, consumers on bill-pay spend over twice as much per month as those on pre-pay (EUR74 compared to EUR33). Meteor, which is the chosen operator for nearly half (44 percent) of 15-24 year olds, continues to make inroads into Vodafone's market share, while O2 has seen a marginal increase. According to the survey 27 percent of people use Meteor, 33 percent are with O2 and 40 percent are Vodafone customers. Three Ireland is fairly static at 2 percent, while Tesco Mobile has less than 1 percent of the market.
Sites combine to make the net safer
The spotlight has fallen on the growing issue of cyberbullying this week, as countries across the European Union marked Safer Internet Day on Tuesday. Over one-fifth of Irish teens have experienced some form of online bullying, with 40 percent of those being bullied online on a regular basis, according to a survey conducted by Microsoft. The majority (70 percent) of those being bullied were targeted via instant messenger, while 48 percent said they've been bullied on social networking sites. In a move aimed at lessening the problem, 17 of the world's leading social networking websites, such as Bebo, Facebook and MySpace, have signed an agreement to be known as 'Safer Social Networking Principles'. Under the protocol, the sites have agreed to a number of measures, including the provision of an easily accessible "report abuse" button on sites, automatically setting under 18s' profiles to private by default and making under 18s' profiles not searchable via websites or search engines. In Ireland, Microsoft and the Minister for Communications, Energy and Natural Resources Eamon Ryan have urged parents to be more vigilant about their child's activities online; over half (55 percent) of Irish teens say they surf the net without any restrictions from their parents. "Today's teens are living more and more of their life online. The advent of social media has helped our children become sophisticated web users, but they still need help and guidance on how to tackle emerging issues such as online bullying," said Paul Rellis, managing director of Microsoft Ireland.
Caped Koala Studios has built a virtual world for kids, combining education and social networking 