IBM Corp holds its conference call on its results much later these days, and first word was coming through as we closed last night, with chief financial officer Jerome York warning analysts not to expect the company’s strong revenue growth of the first quarter to continue for the rest of 1995 – I do not expect that the full year will be a record, he cautioned, and profit margins will be under pressure, with more growth expected from its lower-margin areas, such as personal computers; if the weak US dollar overseas remains at current levels, IBM will get another boost in the second quarter from currency; the troublesome IBM Personal Computer Co followed a disappointing fourth quarter by exceeding IBM’s expectations in the first, shipping over 1m units, its largest first quarter ever; he expects to see improvement in profit margins going forward at the unit, but declined to comment on its profitability – most people assume that it is losing IBM money.
AT&T Corp’s Interchange Online Holding unit has acquired a 9% stake in Luxembourg-based Europe Online SA, German publisher Burde GmbH, which launched the pan-European network and holds a stake in it, said yesterday: Interchange will have a seat on Europe Online’s supervisory board and will have equal rights to the other companies in the consortium; Europe Online had already announced that it would be using the Interchange software, which was originally developed by Ziff Communications Co, and was bought by AT&T at the end of 1994.
Still another major inward investment chip catch remains to be landed: Toshiba Corp, the only major manufacturer still fabricating all its memory chips at plants in Japan, says that it is now considering joining the exodus and building a plant overseas: you get little change from $1,000m when you build a new memory chip plant these days.
Novell Inc has indicated uncertainty about whether it really wants to take over Microsoft Corp’s Money application, and gossip in Washington is that that deal has actually fallen through – and that the Justice Department is making it a condition for Microsoft to acquire Intuit Inc that it find a strong and convincing competitor to buy Money, and that it has failed to find one.
Virtuality Group Plc told the annual meeting that turnover in the first quarter showed substantial growth compared with the 1994 term.
British Rail Telecommunications Ltd is being shopped around by Swiss Bank Corporation, and a trade sale is thought to be its most likely fate, the Financial Times reported: the company presents an opportunity for AT&T Corp, which already has a full operator’s licence in the UK, if it wants to own its own infrastructure; the company has 10,000 miles of copper cable and 2,375 miles of optical cable installed, and over 80% of its turnover of #170m last year, on which it made #17m pre-tax, was with the railway operators; it comprises two divisions, a network division with 230 employees, and a telecommunications engineering division with 2,400.
Italian state holding company Istituto per la Ricostruzione Industriale, IRI, has rejected the proposal by two groups of banks to buy its stake in state telecommunications holding company Stet SpA: IRI said it would push ahead with its original plans for privatisation, naming a global co-ordinator for the sale later; No-one liked the banks’ offers, especially foreign investors, one dealer advised Reuter – Now we should have a clean sale.
Sanyo Electric Co is to invest $77m to build a plant in the northern Philippines to make integrated circuits for audio, video and communications equipment: a new Sanyo Semiconductor Manufacturing Philippines Corp will be the vehicle for the project, located in the Luisita Industrial Park in Tarlac province; the project will create 400 jobs and is to open by September 1996.
Ascom Holding AG announced that it crept back into profit last year.
Indian and foreign firms asked the government to take a quick decision on tenders for running basic and cellu
lar services in the country, the Federation of Indian Chambers of Commerce & Industry said: the government said on Wednesday that the last date for submission of bids was being extended to 21 days from the issue of clarifications, because it had not replied to queries about the tender documents raised by prospective bidders.
NEC Corp says it has received an order for what it claims is the world fastest supercomputer, a 32-processor SX-4 rated at up to 64 GFLOPS peak, from the National Research Laboratory in the Netherlands: NEC declined to say how much the company was paid for the order.
None of the three leading presidential candidates, Jacques Chirac, Edouard Balladur or Lionel Jospin, are openly committed to privatisation of France Telecom ahead of the first round of the election on Sunday, reports 01 Reseaux, which asked each candidate whether the project to change the company’s status was now dead: Jospin, the socialist candidate said France Telecom had the vocation to remain in the public sector; Balladur, whose regime saw the privatisation process collapse in the face of union intransigence, said that the reform process was effectively dead and did not see the state abandoning control to private interests; and Chirac, the front-runner, said that any change will have to be done in taking account the interests of both the state shareholder and of its employees; as to whether France Telecom should ally itself with an equipment manufacturer such as Alcatel NV, the candidates were less categorical – Jospin declared himself opposed to Alcatel taking a stake in France Telecom; Balladur was evasive, saying that the best solution is one that allows the operator to best compete, which implies that the form of that solution can change with time; and Chirac played the magnanimous politician – It is up to France Telecom to define the best strategy it can to respond to meet the needs of its markets and its customers.
Romania is negotiating a new $106m loan from the European Investment Bank to be used to install up to 30 new telephone exchanges across the country over the next three years; the loan is expected to be part of a $420m package now under negotiation with the European Bank for Reconstruction and Development and the World Bank to improve the phone system; the 10-year loan, with its five-year grace period, would go to state phone company Romtelecom RA.
Meantime L M Ericsson Telefon AB and Siemens AG will install some 3,000 miles of fibre optic cable across Romania to upgrade its telephone system: The contracts with the two companies will be signed next week; the value of the project amounts to $180m, ministry spokesman Constantin Sofronie announced.
Ithaca, New York-based 3D/EYE Inc has won Paul Allen as an investor: he has bought a 10% stake in the software company, which specialises in software for generating three-dimensional graphics; no terms.
At the Internet World show it was claimed that some 5m World Wide Web users have created home pages and the number doubles every 57 days: PC Week’s gossip columnist works out that at that rate, there will be one Web site for every person in the world in just four years’ time.
