Briefs: March 14, 2005

TECH DATA'S RAYMUND: 'EVERY ORDER HOTLY CONTESTED'

"I really couldn't say who's the most aggressive. If you ask our sales reps, they would cite the distributor to whom they lost the last order," Raymund said last week. "Each and every order is pretty hotly contested." Raymund added that aggressive pricing has touched VARs, direct marketers and corporate resellers. To offset lower revenue, Tech Data has sought to stabilize gross margins by decreasing costs, Raymund said. Still, Tech Data's gross margins for the fourth quarter ended Jan. 31 were 5.44 percent, down from 5.94 percent in the year-ago quarter.

Ingram Micro Co-President Kevin Murai and Synnex North America President and COO John Paget have said that aggressive pricing and the scramble to maintain market share has affected their results as well.

IT'S ALL SYSTEMS GO FOR IBM-LENOVO DEAL
The last hurdle to IBM's sale of its PC business to Lenovo appeared to fall last week as the Committee on Foreign Investment in the United States cleared the way for the deal, now expected to close as early as next month.

Some U.S. lawmakers had raised objections based on national security concerns over the first major merger between a U.S. and a Chinese company and the fact that the Chinese government is a minority holder in Lenovo.

"I'm not surprised in the least that this passed government scrutiny," said Bob Venero, president and CEO of Future Tech, a Holbrook, N.Y.-based solution provider. "The way [IBM Chairman and CEO] Sam Palmisano crafted this deal was very smart. Before everything was finalized, he put it out to the public and was able to make adjustments to the deal based on public and customer perceptions."

For example, Venero noted the new company will be located at IBM headquarters in Armonk, N.Y., and all government contracts will be handled, fulfilled and built out of Raleigh, N.C.

Stephen Ward, IBM's senior vice president and general manager of the Personal Systems Group, who will serve as the CEO of Lenovo, reiterated last week that IBM and Lenovo are moving quickly to integrate the two companies and expect to finalize the transaction in the second quarter as planned.

THE SMALLER THE BETTER AT WORLD'S LARGEST TRADE SHOW
At CeBIT, less is more, at least when it comes to products for the digital lifestyle. The trade show is the world's largest, drawing around 6,000 vendors. At the show last week, Samsung introduced palmsize camera phones with resolutions of at least 5 megapixels. The SCHV770 7-megapixel camera even has an optical zoom lens.

Other companies attending the show in Hannover, Germany, touted new security technologies. Fujitsu demonstrated an infrared device that scans the palm of a person's hand to check vein patterns. If the patterns match those on file, access to certain rooms or computers is granted.

Sony Ericsson, for its part, launched a mobile camera called the ROB-1. The device is mounted on three wheels and is maneuvered from up to 165 feet away using a Bluetooth connection and a cell phone. The camera can pivot up by 70 degrees or down by 20 degrees. The ROB-1 can store photos or send them to the cell phone.

IBM, meanwhile, gave a preview of its prototype nanotechnology memory chip that promises to let users store the equivalent of 25 DVDs worth of content on a chip the size of a postage stamp.

CISCO ADDS VIRTUALIZATION TO FLAGSHIP LINE OF SWITCHES
Cisco Systems last week added intelligence to its MDS 9000 storage switching line to allow for network-based virtualization. The company also released software that will let customers perform serverless backups through the storage-switching fabric.

The release will be compatible with storage systems and software from numerous other vendors, including EMC, Veritas Software and ComVault.

This cross-vendor compatibility is crucial and is enabled by support for the emerging Fabric Application Interface Standard specification. FAIS is widely supported by the storage industry and defines a standard API that will allow different storage applications to interface with network-switching platforms. FAIS will provide a standard way of interfacing various applications and virtualization appliances with different switches, said Paul Dul, Cisco's product line manager for storage networking.

"Cisco believes the fabric is the ideal place to host intelligent storage applications," Dul said. For example, rather than run a volume-management app on the host or the storage system, by running it on the storage fabric a customer can swap arrays without bringing down the system, he said.

NOVELL PARTNERS WELCOME OPEN ENTERPRISE SERVER
Novell last week released its Open Enterprise Server, a single product that combines the latest upgrade to the NetWare kernel and services and Suse Enterprise Linux 9 distribution and migration utilities.

Open Enterprise Server will offer customers an iPrint client for the Novell Linux Desktop or any Linux desktop, enhanced Virtual Office management features and shared iFolder capabilities between Windows and Linux clients, according to Novell.

The NetWare-Linux server will be available at regular upgrade pricing though Novell's channel, the company said. NetWare will no longer be sold as a separate product. The proprietary NetWare kernel and system services will continue to be enhanced as part of Open Enterprise Server, the company said.

DEPARTMENT OF JUSTICE OPTS FOR COREL WORDPERFECT, NOT MICROSOFT OFFICE
The U.S. Department of Justice inked a five-year extension to keep using WordPerfect Office on more than 50,000 PCs.

The department, which engaged in a long-running antitrust battle with Microsoft Chairman and Chief Software Architect Bill Gates over the company's business practices, was already a WordPerfect shop, although Microsoft Office is also used, said a Corel spokeswoman.

The new license deal is worth "eight figures," although Corel declined to specify further. The license is being fulfilled through SoftChoice, a Corel partner.

WordPerfect has traditionally been strong in legal markets and in government agencies, although Microsoft Word took over the top spot as the world moved to Windows in the 1990s. WordPerfect was subsequently taken over by Novell and then the word processing program was sold to Corel in 1996.

Corel's WordPerfect Office 12 bundles the word processor, the Quattro Pro spreadsheet and Presentations packages.