Weekly Digest
Weekly Digest Issue No. 512
22-04-2010
by Deirdre McArdle
Irish firms enjoy successful week | Apple posts juicy profits
Irish firms enjoy successful week
It's been quite the successful week for a handful of Irish firms with major deals, expanions and investments announced. Dublin-based mobile software developer Cibenix netted a contract worth over EUR2 million to supply its on-device service to Bharti Airtel, India's largest mobile operator. Airtel, which adds more than 3 million new customers every month, will use the Cibenix ODS software app as a portal to promote music, apps and internet-access services to customers directly on their phones. In another mobile deal Cicero Networks signed a contract with Multimedia Polska, which will see the Polish operator purchase Cicero's technology to power its MobilFON voice and messaging service. Using standard GSM handsets, customers can make calls on a mobile network but when in a hotspot area the calls are sent using VoIP.
Limerick-based firm ChipSensors, a developer of silicon sensor chips based at the University of Limerick, this week received funding of EUR2 million from venture capital firm Kernel Capital. ChipSensors Chief Executive Tim Cummins said the investment will enable it to commercialise its technology, and he said negotiations are under way with partners for market and distribution channel support in the US, China and Japan.
Meanwhile, Mullingar-based firm Brywest Enterprises announced it was creating 40 jobs through its web portal venture Farmersforum.ie. The farmers' resource includes updates on mart prices from around the country, online auctions and an online vet. The new roles at Brywest will include web developers and sales staff.
Finally, two Dublin-based software firms also had some good news. Business software firm Infor opened a Centre of Excellence (CoE) in Hyderabad, India, with around 550 staff. Employees in the centre will be involved in product development, professional services and support. Olas meanwhile announced that it has won deals in the past six months worth approximately EUR400,000, from customers including the International Criminal Court in The Hague.
Telecoms market poised for change?
The Telecommunications and Internet Federation (TIF) has said it could cost up to EUR2.5 billion to construct new telecoms infrastructure in Ireland that would enable consumers and businesses to access services such as high-definition TV over the internet. In a report (PDF) published on Monday TIF warned that Ireland "must act quickly to avoid being left behind other countries that are accelerating investment" in next generation access networks (NGAs). NGAs typically include the infrastructure that connects customers with the core transport network of telecoms operators, such as mobile mast infrastructure and optical fibres. The TIF report says NGAs have the potential to drive economic recovery by enhancing the development of Ireland's so-called smart economy. The TIF report comes as the Government prepares to launch Ireland's 'Smart Network' on Thursday afternoon.
In separate, but related news, the communications regulator ComReg published its draft Strategy Statement for the communications sector for 2010 - 2012. The regulator is inviting comments on the strategy from stakeholders. ComReg was criticised this week by ALTO following the release of the regulator's SME and Corporate telecoms market survey, which highlighted the continued dominance by Eircom in the fixed line sector, particularly among the SME sector. In all 69 percent of SMEs surveyed said Eircom was their fixed line provider. ALTO said the situation was "down to regulatory conditions that are not sufficiently stringent against the incumbent". It has called on the Government to "consider more effective regulatory conditions for next generation network access given the lessons learned from the failure of regulating Eircom".
Tech heavyhitters see solid results
Tech sector results came in thick and fast this week. By and large, the figures highlighted a return to economic stability with the heavy hitters of the tech world recording rising profits and revenues. First up chipmaker AMD saw net income for its fiscal fourth quarter hit USD257 million, rebounding from a USD416 million loss in the year-ago quarter. Revenue was USD1.57 billion, surpassing Wall Street Journal analysts' expectations of USD1.54 billion. In spite of the positive figures the chip firm said its results for the upcoming quarter would be seasonally weaker, disappointing analysts.
A key bellwether of the tech sector, IBM recorded first quarter revenue of USD22.9 billion, up 5 percent on the year-ago period. Net income jumped 13 percent to USD2.6 billion, or USD1.97 per share, as sales of computer services, software and hardware to businesses all increased compared with the same period last year. Analysts had been expected profits of USD1.93 per share on revenue of USD22.8 billion. Buoyed by the solid figures Big Blue also raised its 2010 earnings outlook to USD11.20 per share, up from a previous estimate of USD11, and analyst estimates of USD11.12. In a separate development, IBM on Wednesday told staff at its Dublin technology campus that it is seeking a number of voluntary redundancies. While the firm has not said how many redundancies it is looking for, reports suggest it could be as many as 200.
Finally, on Wednesday storage giant EMC posted profit of USD372.7 million, or USD0.17 a share, up a massive 92 percent from USD194.1 million, or USD0.10, a year earlier. Meanwhile, revenue increased 23 percent to USD3.89 billion. Analysts had forecast profits of USD0.24 per share on revenue of USD3.7 billion. Looking ahead to the full year, EMC said it now expects adjusted earnings of USD1.18 a share on revenue of USD16.5 billion, up from an earlier prediction of USD1.12 a share and USD16 billion. In general, the results released this week all point to a tech sector recovery, which has been kick-started by a return to corporate spending on IT.
Google posts strong profit, faces privacy demands
Google this week posted a 37 percent jump in profits for the first quarter with net income coming in at USD1.96 billion, or USD6.06 per share, compared to USD1.42 billion, or USD4.49 per share in the year-ago quarter. Revenue meanwhile increased by 23 percent to USD6.78 billion, from USD5.51 billion a year ago. An improving economy and a return of large advertisers enabled Google to get off to a "very positive" start to the year, Chief Financial Officer Patrick Pichette said. The internet behemoth also said it plans to continue spending aggressively on obtaining talent, which spooked investors and sent its shares lower in late trading last Friday.
In a busy week for Google, on Monday privacy officials from 10 countries sent the internet giant a letter demanding that it build more privacy protections into its services. The letter was signed by officials in Canada, France, Germany, Ireland, Israel, Italy, the Netherlands, New Zealand, Spain and the UK; it reprimands Google for what it describes as a range of privacy abuses, from inadequate protections in its Buzz service to its procedures for retaining the images it gathers for Street View. A Google spokesperson declined to comment on the content of the letter, however, on Wednesday the search giant disclosed for the first time the number of requests it has received from government agencies for data about its users. Via an online map Google also disclosed how many government requests it gets to remove content from its search engine, YouTube, Blogger and other services.
Apple posts juicy profits
In a result-laden week, Apple also came up with the goods. The iPhone and iPad maker posted an impressive 90 percent increase in second quarter profit and a 49 percent jump in revenue, far above Wall Street estimates. Apple had been expected to report earnings per share of USD2.46 on sales of about USD12 billion; it actually posted earnings of USD3.33 a share, or USD3.1 billion, on sales of USD13.5 billion for the three-month period. The remarkable figures came as the company shifted 8.75 million iPhones globally during what Steve Jobs said was the firm's "best non-holiday quarter ever". In addition, Jobs said the new iPad had been well received; latest figures suggest over 500,000 units have been sold in the US with the 3G versions poised for release at the end of this month. Apple will also be releasing pricing and availability details of the iPad for international markets on 10 May. Jobs also promised "several more extraordinary products in the pipeline for this year". Analysts expect a new version of the iPhone to be released as early as June.
Lenovo Android device is "ready to fight" iPhone
Chinese PC maker Lenovo squared up against the might of the iPhone this week, revealing details of its first smartphone, due to launch next month. Lenovo, which had previously announced its intention to get back into mobiles, has called the new device LePhone; the phone will be based on Google's Android operating system and include push e-mail. Lenovo executives said the gadget would come with hundreds of applications tailor-made for the Chinese market, the largest mobile market in the world. "We are ready for a fight with the iPhone," said Liu Chuanzhi, Lenovo chairman.
Caped Koala Studios has built a virtual world for kids, combining education and social networking 