Weekly Digest
Weekly Digest Issue No. 489
29-10-2009
by Deirdre McArdle
Canadian success for Irish firms | Nokia suit could bruise Apple
First Derivatives enjoys a good run
Newry-based First Derivatives had an active week, which saw the company make two significant investments. Last week it ploughed USD7.5 million into one of its US-based sales partners, Kx Systems, increasing its stake in the US firm from 5 percent to 20 percent. Following that, on Monday, First Derivatives acquired New Jersey software firm Reference Data Factory (RDF) for a grand total of USD10 million. The acquisition will comprise an initial payment of USD2.5 million, with further payments totalling USD7.5 million payable on the back of sales generated by RDF over the next three years. The purchase strengthens First Derivatives' range of financial data management-related software products, with RDF's product suite integrating with First Derivatives' flagship product, Delta. The Northern Irish firm has had a solid year so far. The firm posted an impressive 66.3 percent jump in revenues for the six months ended 31 August. Operating profits too were up, reaching STG3 million, a 21.6 percent jump from STG2.4 million in the year-ago period, while pre-tax profit increased by 36.4 percent to STG3.1 million. All in all, it's been a good few months for First Derivatives.
Canadian success for Irish firms
A trade mission to Canada last week reaped rewards for the Irish companies that went along, between them signing deals worth around EUR10 million. In all, some 35 firms accompanied Enterprise Ireland to Canada including companies in the software and telecoms sectors. Among the successful firms was software company Lincor Solutions, which won a significant contract to install its MEDIVista product in the London Health Sciences Center (LHSC) in Ontario. Lincor specialises in providing digital media entertainment and clinical access solutions at the point of care. Meanwhile, online payment firm 3V signed two deals that pave the way for the firm to bring its pay-as-you-go 3V Visa vouchers to the Canadian market. The agreements were signed with financial institution Peoples Trust Company and Vendtek Systems. Dublin firm IdentiGEN also got in on the act when it established a wholly-owned subsidiary in Canada as part of its growing business in that region. IdentiGEN provides DNA-based meat traceability solutions to track meat from the farm to the retail store. Other deals include a licensing agreement between software firm S3 Group and Canadian power line firm Intellon, and Dublin IT security firm VigiTrust, which launched its Security Accreditation Management System (SAMS) product in Canada. SAMS is a SaaS-based compliance management tool that enables organisations to manage their PCI DSS compliance projects. Overall, the trade mission was a successful one. "If we build on this [trade mission success], we can expect a major acceleration of trade and investment between our two countries over the next few years," said Enterprise Ireland CEO Frank Ryan.
Deals highlight social web development
As rumoured at the beginning of October, both Microsoft and Google this week signed licensing deals with Twitter, which will bring real-time tweets into Bing and Google search results. Microsoft jumped in quickly and got its standalone Twitter search page up and running, while Google said its service would debut within the next few months. Financial details of the deal have not been revealed. Microsoft also stole a march on Google in announcing a similar type of real-time deal with social networking site Facebook, whereby public status updates will be displayed in Bing search results. For now though this deal hasn't been enacted yet and will arrive at "a later date", according to Microsoft. There is no word yet if Google is going to announce a similar deal with Facebook, although early reports indicate it is a strong possibility. As things stand now Bing has taken first-mover advantage in the real-time search battle, although one can never discount Google. Indeed, this week the internet giant also announced a Google Labs product called Social Search, which allows users to find online content posted or written by their contacts to the likes of Twitter or Facebook, through a Google search. With these announcements we are seeing a real shift in the nature of the web. Though some observers may find all of this a bit scary (for want of a better word), there's no doubt that this is the direction we are heading. Looks like we should buckle up for the ride.
Ups and downs in tech sector results
A bunch of quarterly results from ICT sector stars filtered through this week -- some positive, some not so positive. First up, online retailing giant Amazon posted a 69 percent surge in third-quarter profit. The e-tailer said income for the quarter grew to USD199 million, or USD0.45 a share, from USD118 million, or USD0.27 a share, a year ago. Sales increased 28 percent to USD5.45 billion, thanks to a 44 percent rise in sales of electronics and general merchandise, such as the Kindle. Amazon is optimistic about the future, forecasting that fourth-quarter sales would grow between 21 percent and 35 percent to between USD8.1 billion and USD9.1 billion, with operating income projected to rise between 10 percent and 56 percent to USD300 million to USD425 million. Meanwhile, although Microsoft's third-quarter profit saw a year-on-year decline, it was far better than the figure that had been expected. The software behemoth posted net profit of USD3.57 billion, or USD0.52 per share, for the third quarter, down 18 percent on the year-ago figure, but well ahead of analysts' expectations of USD0.32 per share. Revenue at the software giant was also down year-on-year, coming in at USD12.92 billion, a drop of 14 percent from the third quarter last year. Elsewhere, Microsoft's chief rival in the games console sector, Nintendo, had a poor performance in the first half of 2009. Though initially the firm seemed impervious to the economic downturn, a drop in Wii sales has had a dramatic effect on its bottom line. Net profit for the first half of the year fell more than 50 percent to JPY69.49 billion (USD770 million), from JPY144.83 billion a year earlier. Operating profit slumped 58.6 percent to JPY104.36 billion in the six months through September as revenue slid 34.5 percent to JPY548.06 billion. Nintendo sold just 5.75 million Wii machines worldwide in the period, down from 10.1 million a year earlier. On the back of its results the firm has slashed its Wii sales forecast for the full year to 20 million consoles worldwide, compared to a previous estimate of 26 million.
Nokia suit could bruise Apple
In a surprise move last Thursday, Finnish mobile giant Nokia filed a lawsuit against Apple in a US federal court, claiming that the iPhone maker has infringed on ten of Nokia's patents. The patents cover wireless data, speech coding, security and encryption and are infringed by all Apple iPhone models shipped since the iPhone was introduced in 2007, Nokia said. Some 34 million iPhones have been shipped worldwide. "By refusing to agree appropriate terms for Nokia's intellectual property, Apple is attempting to get a free ride on the back of Nokia's innovation," Ilkka Rahnasto, Vice President for Legal & Intellectual Property at Nokia, said in a statement. For its part Nokia said it had made several price offers to Apple on a per-patent and on a portfolio basis, but Apple declined the offers. On Tuesday, Apple issued its annual report in which it said it "intends to defend the case vigorously." Industry commentators have predicted that the case between these two Goliaths could last for at least a year, with the potential for it to be ongoing for as long as three years. Early reports are suggesting that if the iPhone maker loses the case, it could end up having to pay Nokia as much as USD1 billion for the technologies used in the iPhone.
Caped Koala Studios has built a virtual world for kids, combining education and social networking 