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5 Companies That Had A Rough Week

For the week ending Feb. 28, CRN looks at IT companies that were unfortunate, unsuccessful or just didn't make good decisions.

The Week Ending Feb. 28

Topping this week's roundup of those having a rough week is Hitachi Vantara, which began employee layoffs amid changes in the data storage market.

Also making this week’s list is HP Inc. for having to cancel its Reinvent partner conference because of the coronavirus epidemic. Cisco made the list for plans for its own pending layoffs, while Apple lost a bid before the U.S. Supreme Court to overturn a $439 million patent jury verdict. And all four major wireless carriers – AT&T, Sprint, T-Mobile and Verizon – face millions in potential fines from the Federal Communications Commission over the sale of customer location data.

Not everyone in the IT industry was having a rough go of it this week. For a rundown of companies that made smart decisions, executed savvy strategic moves – or just had good luck – check out this week's Five Companies That Came To Win roundup.


Layoffs Are Underway At Hitachi Vantara

It was a tough week for Hitachi Vantara and its 12,000 employees as the developer of analytics, IoT and data storage technology began a series of layoffs.

A company spokesperson confirmed to CRN this week that layoffs were occurring but did not provide details on the number of employees or segments of the company that would be impacted.

Online news site Blocks & Files said the layoffs could number as many as 1,500 employees. But the company spokesperson denied the number was that high, saying the number was substantially lower.

The company is dealing simultaneously with a maturing data storage market, the company’s original business, and a fast-growing digital transformation market, driving demand for the company’s data management, analytics and IoT products.


HP Postpones Reinvent Partner Conference, Lowers Earnings Guidance On Coronavirus Concerns

The coronavirus continues to wreak havoc on the IT industry. This week HP Inc. announced that it was postponing its Reinvent annual partner conference to the fall in response to the coronavirus COVID-19 epidemic.

Reinvent 2020 was scheduled to take place from March 24 to 26 in Anaheim, Calif. The conference is the latest industry event to be canceled because of the coronavirus: Other canceled events include the Mobile World Conference in Barcelona earlier this month and Facebook’s F8 developer conference in May.

HP, citing the coronavirus epidemic, also lowered its earnings forecast for its second fiscal quarter, saying it has factored in an 8-cent impact to its earnings-per-share guidance for the quarter that runs through the end of April. The company said it expects to see a “negative impact” to its top-line sales, bottom line profits and cash flow for the quarter.


Cisco Layoffs Planned In Wake Of Global Economic Uncertainty

Networking giant Cisco Systems confirmed this week that it is planning a round of layoffs in the midst of slower-than-usual sales growth brought on by macroeconomic pressure, trade wars and – potentially – the coronavirus epidemic.

Cisco confirmed the layoffs to CRN on Friday but did not disclose how many layoffs are expected or which business segments of the company would be affected.

The company has some 75,000 employees worldwide.

Earlier this month Cisco reported that revenue in its fiscal second quarter ended Jan. 25 declined 4 percent year over year. The company cited longer decision-making cycles for businesses, macro uncertainties and unique geographical issues that took a toll on sales.


Apple Loses Supreme Court Bid To Overturn $439M Patent Verdict

It looks like Apple will have to cough up $439 million to settle a long-running patent infringement case.

This week the U.S. Supreme Court refused to consider an appeal by Apple of a 2016 federal jury finding that the company violated patents held by VirnetX Holding Co., a Nevada-based patent licensing company, according to Reuters and CNN Business stories.

VirnetX sued Apple in 2010 in a federal court in Texas claiming that Apple violated four of its patents by using VirnetX’s VPN technology in Apple’s FaceTime video calling and VPN on Demand applications.

In 2016 a federal jury found that Apple had violated the four patents and owed VirnetX $302 million. A judge later increased that to $439.7 million, including interest and other costs, the Reuters story said.

Apple has been seeking to have the verdict overturned ever since. But the U.S. Court of Appeals for the Federal Circuit in Washington D.C. upheld the verdict last year. This week’s Supreme Court decision could be the end of the appeals road for Apple.


Four Leading Mobile Carriers Face Millions In FCC Fines

The Federal Communications Commission has proposed fines totaling more than $200 million against AT&T, Verizon, Sprint and T-Mobile after a commission investigation found that the four largest wireless carriers improperly sold access to information about precise customer location without proper safeguards.

The FCC announced Friday that it was proposing the fines for “selling access to their customers’ location information without taking reasonable measures to protect against unauthorized access to that information,” according to an FCC statement.

The FCC is proposing that T-Mobile be fined more than $91 million, AT&T be fined more than $57 million, Verizon be fined more than $48 million and Sprint be fined more than $12 million.

The FCC charges that the four companies sold the location information to aggregators, who in turn re-sold access to the data to third-party location-based service providers. The FCC statement names Securus, a provider of communications services to correctional facilities, as one such location-finding service.

The statement said the FCC also “admonished these carriers for apparently disclosing their customers’ location information, without their authorization, to a third party.”

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