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Date: Tuesday, November 07, 2000, 2:18 PM -0500
From: Faulkner Information Services <mailserver@faulknerinfo.com>
To: ???
Subject: Faulkner Com Flash 11/01/00 - (Part 2 of 2)


Network/Systems Management
BMC Software reported an addition to its Service Level Management (SLM)
called the OnSite Elite designation. Part of the company's OnSite
certification program, OnSite Elite helps companies deliver Service Level
Management via BMC's Service Assurance Center. With the OnSite Elite
designation, businesses can further optimize their e-business applications
as well as their Web site. 

BMC Software also unveiled the Pool Advisor for DB2, a service that
collects and analyzes real-time pool usage data. Pool Advisor for DB2 will
be bundled with BMC's OPERTUNE for DB2, MAINVIEW for DB2, and AutoOPERATOR
for MVS. Pool Advisor's overall purpose is to automate performance tuning
and improve overall DB2 performance. 

In addition, BMC Software launched CONTROL-D for Distributed Systems, a
suite of products that manages electronic information generated in
distributed systems and mainframe environments. Reports and documents
generated by applications on diverse platforms and systems are delivered to
various destinations such as printers, e-mail addresses, and fax devices. 

NetManage launched ViewNow InterDrive Client 7.0. Based on NetManage's
InterDrive NFS technology, ViewNow InterDrive Client 7.0 features security
and support improvements and via Kerberos v5, provides client/server
authentication through 56-bit data encryption. 


Security
Symantec unveiled www.Symantec.com/SecurityCheck, an Internet security web
site designed to provide users with information about their individual
Internet security needs. This free web site includes Symantec Security
Check, a web-based tool for evaluating potential online security threats.
After determining whether the PC is susceptible to hackers, viruses, and
privacy threats, Symantec Security Check provides and pinpoints the most
effective and appropriate protection and deterrents. 

Symantec also unveiled updated versions of Norton Utilities for Macintosh
and Norton AntiVirus for Macintosh. Norton Utilities for Macintosh 6.0
optimizes performance, solves disk errors, and retrieves lost or
accidentally erased data. Norton AntiVirus for Macintosh 7.0 detects and
repairs infected files to keep personal data safe and secure. 

Trend Micro reported that Dutch telecom provider Telfort, a subsidiary of
BT will offer its business customers an antivirus service based on Trend
Micro's InterScan VirusWall technology. Telfort will also provide its
customers with e-mail content filtering based on Trend Micro's eManager
technology, which is used to filter all inbound and outbound SMTP
communications. 


Storage
Computer Associates introduced the SANITI (Storage Area Network Integrated
Technology Initiative) Framework for SAN management. This product was
validated by many third-party SAN technology vendors and storage industry
organizations, and simplifies the integration of multi-vendor SAN
components. 

Seagate Technology unveiled the Barracuda 36ES, an 18 and 36 Gbyte
full-featured SCSI disc drive for entry servers and high-performance PCs.
The Barracuda 36ES is leveraged from Seagate's Barracuda ATA technology,
and features a high-speed Ultra160 SCSI interface. This offering enables
Ultra160 SCSI interface to new systems, and easily upgrades and expands to
existing SCSI systems. 

StorageTek unveiled the StorageNet 6000 (SN6000) series of storage domain
managers, a family of virtual SAN products. The SN6000 series will enable
enterprises to consolidate their storage assets across open systems hosts
and applications. This release is part of the company's openSAN strategy,
and is designed to save users downtime and to minimize storage
administration time. 

StorageTek also introduced an updated version of its Shared Virtual Array
SVA 9500 and suite of companion software, the Virtual Power Suite. Both
offerings feature a natural progression for existing virtual disk users and
a alternative for traditional disk users looking for a break in their
ever-increasing disk budget cycle. 

Tivoli Systems launched the Tivoli SANergy 2.2. This updated version of
SANergy includes a suite of published programming applications for
third-party integration, expanded platform support, and additional
performance enhancements to enable Tivoli SANergy to deploy
mission-critical applications in a SAN environment. 


Regulatory News
AOL and Time Warner extended its talks with the FTC for two weeks. Although
antitrust law sets deadlines for federal authorities to review mergers,
companies may extend those deadlines if they do not reach an agreement. The
deadline is now set for November 10. 

Facing a mid-December deadline on how to reduce its share of the US cable
market, AT&T is seeking President Clinton's help to change how the
government defines ownership in the cable market. Current laws limit
ownership of the cable market to 30 percent; AT&T is arguing that the
regulations account for passive interests in companies that AT&T does not
control influence of, pushing its share of the cable market to 42 percent.
AT&T agreed to shed some of its cable interests by May 19, 2001 as a
condition of the MediaOne acquisition. AT&T is now working with Senator Ted
Stevens to modify the rules and is calling on Clinton to help. In a letter
to the President, AT&T CEO Michael Armstrong lobbied for a "modification of
the rules that would attribute a cable system's subscribers to a provider
that owns the system, controls the system, or influences the system's
selection of programming." Consumer groups and the US Telecom Association
are urging lawmakers to reject any changes AT&T wants to make, contending
that it would allow the company to exert control over programmers and
consumers. 

A provision that would have prevented US regulators from considering
Deutsche Telekom's proposed acquisition of VoiceStream Wireless has been
struck out. The deal, now valued at about $28 billion, already received
clearance from the US Justice Department but must also win approval from
the US Committee on Foreign Investment. 

In September 2002, the US government will hold auctions for spectrum used
for third-generation wireless services. The US was against holding auctions
for more spectrum at the World Radiocommunications Conference in May; it
believed that each individual country should decide how to allocate
spectrum. In addition to this auction, the FCC is planning to auction off
90 licenses in December. The licenses were held by NextWave Personal
Communications, but the company defaulted on its payments and the FCC took
back the licenses. These are in addition to over 400 licenses the FCC is
hoping to auction beginning December 12. Congress, however, is mulling over
the idea of delaying the auction since NextWave's appeals of the FCC's
decision to take back the licenses are not all completed. 

The US Bankruptcy Court for the District of Delaware confirmed the Amended
Plan of Reorganization under Chapter 11 provided PageNet. With the plan
confirmed in court, Arch Wireless and PageNet can close their merger in the
early part of November. The merger includes the exchange of PageNet's
senior subordinated notes and the spin off of Vast Solutions, PageNet's
wireless solutions company. The plan of reorganization states that PageNet
noteholders will receive 84.9 million shares from Arch and a 60.5 percent
interest in Vast. PageNet's common stockholders are receiving 5.0 million
shares of Arch and a 20 percent interest in Vast, and Arch is taking the
remaining 19.5 percent interest. 

Tired of being a regulatory wimp before Telmex, Mexico's telecom watchdog,
Cofetel, plans to present its own proposals for legal reform that would
give its bark some bite. Cofetel, which has come under heavy fire since the
trade dispute between Washington and Mexico over access to Mexico's $12
billion telecom market, hopes a draft bill that would increase its autonomy
and give it some power to sanction abuses in the telecom industry will be
ready by next March. 

Verizon Communications, the first regional Bell to sell long distance
services within its own area, agreed to pay $1.75 million in fines for
possibly slamming New York customers. The company was slapped with a
$250,000 fine by the FCC and agreed to reimburse 34,000 NY customers $1.5
million. The FCC launched an investigation for possible slamming when
Verizon did not have records for some long distance customers that were
signed up by third parties. In other news, the Massachusetts Department of
Telecommunications and Energy recommended that the FCC approve Verizon's
bid to offer long distance services in the state. The FCC is expected to
decide by December. 


Financial News
Blu rejects the Italian governments claim that the group withdrew in an
irregular fashion when it quit an Italian auction of UMTS licenses after
only 11 bidding rounds. Blu insisted it acted properly and would demand
back its $1.76 billion deposit and avoid paying compensation to the Italian
government. The auction raised just half the expected amount after Blu
quit. 

Avaya posted a drop in fourth quarter operating income. Reported income
from ongoing operations was $20 million, or seven cents per share, compared
with $46 million, or 16 cents per share, for the same period in 1999.
Revenues were 2.02 billion, compared with 2.15 billion for the previous
year's quarter. Avaya targeted a percentage revenue rise in the mid-single
digits. 

Boosted by strong sales in the wireless and data sectors, BellSouth
reported that its third quarter profits rose 4.2 percent. Net income was
$1.04 billion, or $0.55 per share, compared to $995 million, or $0.52 per
share, for the same period last year. Consolidated revenues increased 7.5
percent to $6.9 billion. Data revenues or $894 million represented more
than 40 percent of consolidated revenue growth and the company's DSL
customer base increased more than 80 percent during the quarter. At the end
of the quarter BellSouth had 6.2 million wireless telephone customers in
the US before merging the wireless assets with SBC Communications wireless
operations this month. BellSouth also added more than one million
international wireless subscribers, bringing its total wireless base to
more than 8.7 million. Cingular, the wireless venture between BellSouth and
SBC, plans to tender an IPO next year. BellSouth also expects to launch a
tracking stock that will reflect its wireless operations in Latin America
next year. 

BMC Software reported second quarter 2001 revenues of $323.0 million, a 22
percent decrease from $415.7 in revenues last year. The company reported a
net loss of $12.5 million, or $0.05 per share, compared with a net loss of
$58.9 million, or $.23 per share, a year ago. BMC blames it decline in
revenues on customer reluctance over large enterprise license transactions. 

Following a five year legal battle to reduce charges accessed by local
governments in England and Wales, British Telecom is to receive a $362.7
billion refund. 

Europe's last, major auction of UMTS licenses flopped after one of the
contenders, British Telecom -backed Blu quit after just two days of
bidding. BT was willing to increase its 20 percent stake and take more of a
risk in Blu, but could not meet the demand of other shareholders who wanted
BT to shoulder a larger portion of the license costs. The move means the
remaining five bidders, Telecom Italia; Vodafone -controlled Omnitel; Wind,
the Enel France Telecom joint venture, Telefonica-backed IPSE 2000, and
Hutchinson's Andala could land an Italian UMTS license for a bargain. 

Computer Associates reported second quarter 2001 revenues of $1.681
billion, an increase of 5 percent over the $1.605 billion reported last
year. Net income was $138 million, compared with $334 million last year.
The company reported diluted earnings per share of $0.54, compared with
$0.75 a year ago. 

Covad's stock fell nearly 60 percent and hit an all-time low after posting
revenues that decreased 15 percent. The company cited partners having
trouble paying bills as the reason for the drop. Covad also assured that
those revenues would be made up in the current quarter and that the company
would stop posting losses within two years. Stock of DSL providers
Northpoint and Rhythms NetConnections also dropped 18 and 25 percent
respectively. 

For the third quarter of 2000, DDI reported that net sales increased 80
percent to $149.6 million from $82.9 million in 1999. Adjusted net income
increased 426 percent to $14.0 million compared to $2.7 million; on a
diluted per share basis, adjusted net income was $0.33 compared to $0.11
for the third quarter of 1999. 

EMC reported third quarter 2000 revenues of $2.28 billion compared with
revenues of $1.7 billion a year ago, an increase of 34 percent. Net income
was $458.2 million, or $0.21 per diluted share, compared with a net income
of $295.8 million, or $0.14 per diluted share a year ago. 

Entrust posted third quarter 2000 revenues of $42.2 million, compared with
revenues of 22.6 million a year before. The company reported a net income
of $28.8 million, or $0.46 per diluted share, compared with a net loss of
$2.0 million, or $0.04 per diluted share, for the same period a year ago. 

ePresence reported third quarter 2000 revenues of $22.7 million, compared
with revenues of $12.2 million a year ago. The company reported a net loss
of $1.8 million, or $0.08 per diluted share, compared with a net loss of
$985,000, or $0.04 per diluted share, a year ago. These results indicate
ePresence's continued success in their e-services business. 

For the third quarter 2000, Ericsson earned 4.4 billion kronor, up from 2.6
billion kronor for the same quarter in 1999. Net sales for the quarter were
67.3 billion kronor, up from 49.2 billion kronor. Despite overall
increases, Ericsson's losses widened in its cellular phone unit. The
consumer products unit had an operating loss of 4.1 million kronor.
Operating loss for the same quarter in 1999 was 619 million. The company is
now predicting a loss of around 16 billion kronor for the full year in its
mobile phone unit. Ericsson attributed the losses to shortages from a key
supplier, price competition, and restructuring changes. In an attempt to
restore profitability, the company will transfer the production of handset
units from Sweden and the US to Asia, Eastern Europe, and Latin America.
Also as an effort to ease financial troubles, the company is canceling the
launch of its Bluetooth world T36 phone in favor of the R520 phone. 

France Telecom expects to raise as much as $11.74 billion through its
planned IPO of shares in its Orange unit in January. If all goes according
to plan, FT would use proceeds from the IPO to repurchase FT shares held by
Vodafone, which acquired the shares through its sale of Orange. 

After posting third quarter losses of $219 million, Globalstar's stock
dropped 60 percent, purportedly causing Loral Space &

Communications to halt future investments in the satellite phone company.
The Wall Street Journal reported that Globalstar's new strategy, which
includes shifting focus from consumers to government, military, and large
corporate customers, did little to soften the blow to the company's shares.
Bernard Schwarz, Globalstar and Loral chairman, believes that the new
strategy will make the company's service viable, but current struggles may
be a signal of an Iridium-like disaster. 

Micromuse posted fourth quarter 2000 revenues of $41.1 million, compared
with revenues of $19.2 million a year ago, an increase of 114 percent. Net
loss was reported at $5.4 million, or $0.13 per diluted share, compared
with a net loss of $2.1 million, or $0.06 per diluted share, a year ago.
Micromuse attributes its soaring revenues to the wide acceptance of the
Netcool Suite among network service providers. 

Network Associates reported third quarter 2000 revenues of $226.2 million,
a 20 percent increase over last year's $188.4 million. The company reported
a net income of $39.8 million, or $0.27 per diluted share, compared with a
net income of $20.3 million, or $0.13 per diluted share a year ago. 

For the third quarter 2000, Nextel Communications' revenues totaled $1.4
billion, a 59 percent increase, and cash flow reached $359 million, a 105
percent increase. During the period, the company added 681,400 subscribers
to its customer base. Net loss was $236 million, or $0.31 per share,
compared to a loss of $361 million, or $0.55 per share in the third quarter
1999. 

For the third quarter 2000, Nokia's net sales totaled EUR 7.57 billion, a
50 percent increase from EUR 5.03 billion in the third quarter of 1999. The
company also experienced a big jump in operating profits, which rose 39
percent from EUR 951 million to EUR 1.322 billion. Two of the strongest
areas of Nokia's business included Nokia Networks, which continued to lead
in network technologies, and Nokia Mobile Phones, which was able to further
the combination of mobility and the Internet. Net profit for the quarter
was EUR 892 million, compared to EUR 638 million, and earnings per share
were EUR 0.19 per share, up from EUR 0.14 per share. 

PictureTel released its financial results for the third quarter 2000.
Revenues for the quarter were down to $196 million from $241 million for
the same period in 1999. Diluted loss per share was $2.58, up from $1.83
for the previous third quarter. In addition to releasing its financials,
PictureTel signed a letter of intent to sell its audio bridge subsidiary,
MultiLink, in a deal expected to close in the fourth quarter 2000. 

RCN reported a continued growth in revenues and connections in its third
quarter financial report. RCN revenues totaled $107.6 million, a 12 percent
increase from $96.2 million in the previous quarter. In addition, total
on-net connections grew by 15 percent, as RCN added 52,672 connections,
compared with 49,210 connections the previous quarter. RCN posted a net
loss of $85.8 million, or $2.70 per share, compared with $75.8 million, or
$2.45 per share for the previous quarter. 

Rhythms NetConnections announced that its revenue had increased 41 percent
to $17.2 million for the third quarter 2000, as compared with $12.2 million
for the same period in 1999. Rhythms cited a 51 percent increase of DSL
lines in service, from 31,000 in 1999 to 47,000 in the third quarter 2000.
Loss per share for the quarter decreased from $2.07 in the third quarter
1999 to $0.89 in the third quarter 2000. 

For the third quarter 2000, Sprint reported consolidated net operating
revenues of $5.97 billion, an 18-percent increase from $5.07 billion in the
third quarter of 1999. Net operating revenues for the FON Group were $4.4
billion, compared to $4.3 billion. Net income for the group was $384
million, or $0.44 per diluted share, compared to $359 million, or $0.42 per
diluted share. Total net operating revenues for Sprint PCS nearly doubled
to $1.67 billion from $844 million. Net loss for the wireless operation was
$390 million, or $0.41 per share, compared to $615 million, or $0.65 per
share last year. At the end of the quarter, Sprint PCS had 8.61 million
direct and resale customers and more than 550,000 affiliate customers. 

Symantec reported second quarter 2001 revenues of $192.3 million, compared
with revenues of $169.2 million a year ago, an increase of 14 percent. Net
income was $45.8 million, or $0.72 per diluted share, compared with $31.2
million last year, an overall increase of 47 percent. The significant
increase in revenues resulted from the fast market growth of Symantec's
enterprise anti-virus products. 

Tellabs reported third quarter 2000 revenues of $870.6 million, up 46.2
percent from last year's $595.4 million revenues. The company reported a
net income of $210.4 million, a 48.9 percent increase from last year's net
income of $141.2 million. Diluted earnings per share were $0.50, compares
with diluted earnings per share of $0.34 last year. 

Telmex is budgeting $2 billion in capital expenditures next year for each
of the two companies it plans to become by the end of this year. $1.5
billion will go to Telmex's cellular company, Telcel, and the other $500
million is slated for investment into various international operations. 

Time Warner announced that its third quarter earnings beat Wall Street
estimates by increasing 13 percent. The media giant's earnings before
interest rose to 1.27 billion in the third quarter from 1.128 billion in
the previous year. Time Warner's earnings rose to seven cents a share,
beating Wall Street estimates of four cents a share. 

Williams Communications reported record third quarter revenues, including a
21 percent increase from the third quarter 1999. Williams cites record
usage of fiber-optic capacity on its long distance network. During the
year, Williams more than doubled its network customer base to 177 data and
voice customers, with 19 percent growth over the third quarter. Diluted
loss per share for the quarter was 32 cents, as opposed to 22 cents for the
same period in 1999. 


Legal News
British Telecom-backed Blu prepared for a court battle against the
government over a deposit it has been ordered to pay since the end of
Italy's UMTS license auction. Italy raised $10.11 billion from its sale of
five UMTS licenses, far below market forecasts of $25 billion and
government hopes of $21 billion, after Blu quit. 

StarSight Telecast, a subsidiary of Gemstar-TV Guide International, filed a
patent infringement suit against EchoStar Communications. The suit claims
EchoStar infringed on StarSight patents by selling direct broadcast
satellite receivers containing an unlicensed interactive program guide. 

In Los Angeles, Superior Court Judge Carl J. West settled a case between
Lockheed Martin and residents in Burbank claiming illness from pollution
caused by the company. The $5 million settlement ends the four-year battle
between Lockheed and the residents, who believed they were made ill by
chemicals released into the air, soil, and water. With the class-action
suit settled, individual residents may pursue additional legislation. 

Paradyne reported the law firm of Plaintiff, Barrack, Rodos &Bacine filed a
class action suit against persons who purchased its securities. Barrack, et
al stated that the defendants violated Sections 10(b) and 20(a) of the
Securities Exchange Act of 1934, issuing stock that artificially inflated
the price of Paradyne common stock. 


Personnel and Organizational Changes
In a move remarkably similar to plans by its US counterpart, AT&T, BCE said
it would reorganize into four main operating businesses. Effective December
1, BCE will center its activities on four operating businesses: Bell Canada
recently acquired Teleglobe, BCE Emergis, and BCE's new media company. All
other investments will be combined in a new group called BCE Ventures. 

Cox Enterprises, parent of Cox Communications, restructured its senior
management to advance its long-term succession planning. President and COO
David E. Easterly will assume the newly created position of vice chairman,
overseeing Cox's corporate business development. Taking his place as top
executive will be the president and COO of Cox subsidiary Manheim Auctions,
G. Dennis Berry. David Eisner, Cox Enterprises' vice president of business
development, will take Berry's spot in Manheim Auctions. 

Ericsson is moving over 40 percent of its workers from its cellular
telephone business to its network systems gear production business. The
decision to shift its employees to a new area is part of a plan to lower
expenses in its phone business, which generated lower-than-expected profits
for the past quarter. With the new focus on network systems, Ericsson hopes
to meet the demand for next-generation mobile phones networks. 

Following its acquisition this year by France Telecom and reorganization
under CEO, Daniel Caclin, the top executive line-up for Global One has been
completed. Arjen Maarleveld has been appointed CEO of Global Products, and
Patrick Lawrence will serve as CEO of Human Resources and Corporate
Services. 

Hewlett-Packard appointed Richard DeMillo as chief technology officer,
whereby he will oversee the HP Technology Counsel and help set the
company's technology agenda and conduct periodic technology audits. In
addition, Stephen Squires was named chief science officer to investigate
long-term strategic scientific and technical directions. 

As part of a previously announced reorganization, designed to save some 700
million euros, KPN will cut 8,000 jobs in 2001 and 2002. The company said
the planned cuts would be achieved by eliminating a minimum of 2,000
functions carried out by temporary employees and by focusing of staff
turnover. KPN employed about 38,000 at the end of 1999. 

Louis R. Hughes, president and COO of Lockheed Martin, is leaving the
company on October 31 for personal reasons. Hughes has held this position
for only six months and is being replaced by Robert J. Stevens, who has
been serving as the company's executive vice president and CFO. As both CFO
and COO, Stevens will be able to focus on restoring Lockheed's financial
stability. Stevens will remain CFO while taking over both positions held by
Hughes; he was also elected to the board of directors. In a statement,
Hughes gave his reasons for leaving, which included the separation from his
family due to his work. His family lives in Chicago while he works in
Washington. 

The US subsidiary of NTT, NTT America, announced that David Ryan, 17-year
veteran of the industry, has been tapped as vice president to lead NTT
America's business development strategy for the US market. In addition, the
company announced a significant expansion of its US market presence through
the opening of new sales offices in Seattle and Chicago, and a new network
node in Los Angeles. 

Verizon Wireless created the Wireless Data and Internet Services Division,
which is taking over development and deployment of the company's network
infrastructure and marketing of the its data operations. Gary Schulman,
former president of Verizon Wireless' Mid-Atlantic region, was named as the
new unit's president. The Wireless Data and Internet Division overlook all
data services, including the Mobile Web. 

Instead of spinning off or selling its consumer and wholesale businesses,
WorldCom may be creating a tracking stock to help boost its floundering
operations. The company was not planning a stock offering while the merger
with Sprint was still a possibility, but since the merger was blocked, and
because of the sliding stocks of long-distance companies, WorldCom has
changed its focus. By creating a tracking stock for the two units, WorldCom
will be able to concentrate on faster-growing businesses, such as data and
Internet. Long distance companies are being hurt by increased competition,
which forces companies to lower prices. Other options, including selling or
spinning off the operations, would cause WorldCom to pay large taxes and
clear all the regulatory hurdles. 


by: Kay Townes 

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