Cisco Systems is expected to cut as many as 5,000 jobs in August, at least according to market research firm Gleacher & Co.
In a research note 11 July, Gleacher analyst Brian Marshall said the job cuts could rival the 8,000 layoffs that Cisco initiated in 2001, soon after the Internet market crash. In this case, the 5,000 job cuts to the company’s 73,000-strong workforce would be painful but necessary, Marshall said, saving Cisco about $1 billion (£626m) annually.
They also would mark only one of several steps the analyst said Cisco has to make to ease Wall Street concerns.
“While this is a difficult decision to make, in our view, it is required in order to maintain the ‘competitiveness’ of [Cisco] going forward,” Marshall wrote in his research note.
His message comes after Cisco, which has been hampered by several quarters of disappointing financial numbers, looks for ways to improve the company’s operations. The company restructured its consumer business in April, including closing its profitable Flip personal video camera business.
In May, Cisco streamlined its management, sales and services units, a move to help it more easily focus on five IT areas – routing and switching, collaboration, data centre virtualisation and cloud, video, and what officials are calling architectures for business transformation. Cisco also reduced the number of management councils from nine to three.
A week later, during a conference call to announce quarterly financial earnings, Chairman and CEO John Chambers warned of layoffs as the company looked to cut $1 billion in operating expenses this year.
Days after Chambers’ talk, analysts were predicting significant cuts of 4,000 or more.
Marshall’s research note also was released as Cisco Live, the company’s major customer and partner event, gets underway in Las Vegas. The Gleacher analyst said he expects “significant news flow this week,” adding that he was focusing on Chambers’ keynote 12 July and other keynotes.
Despite Cisco’s recent disappointing financial numbers, the vendor has some significant factors working in its favour, according to Marshall. The company has a strong valuation, and it still holds about 70 percent of the core routing and switching market, a maturing sector that doesn’t offer Cisco much room for growth. However, some other business areas that Cisco is looking to grow – from video communications to data centre infrastructure – represent strong growth areas.
He also noted Cisco’s Vblock data-center-in-a-box offering, which includes not only Cisco’s infrastructure products, but also EMC’s storage and security technologies and VMware’s vSphere virtualisation management and services offerings. Marshall called it Cisco’s “ace in the hole,” adding that it seems to be gaining traction in the market.
“Although early in its lifecycle (e.g., Vblocks started shipping at the start of 2010), the ramp has been impressive thus far with partner management (e.g., EMC) recently commenting that Vblock has a $1.0+ billion pipeline with over 120 partners,” Marshall wrote.
However, there are ongoing concerns, he said. Marshall said that Cisco is seeing increasing competition in its core routing and switching business, not only from large competitors such as Hewlett-Packard, but also from the likes of Juniper Networks, Riverbed Technology, Brocade and Force Five, a scenario that he described as “chimpanzees … attacking the gorilla.”
All retail banking customers ringing Santander will have their queries dealt with by UK workers after the bank decided to stop using two Indian call centres.
Santander is to stop using Indian call centres in a bid to improve customer services
According to Santander, the decision was taken to use UK rather than Indian call centres after customers experienced "frustration leading to dissatisfaction".
Retail banking calls will now be handled by 500 staff based in Glasgow, Leicester and Liverpool, bringing the number of UK-based call centre staff used by the financial services group to 2,500.
Ana Botín, CEO of Santander UK, said the decision was taken to improve customer services.
"Our customers tell us they prefer our call centres to be in the UK and not offshore. We have listened to the feedback and have acted by re-establishing our call centres back here," she said in a statement.
The offshore call centres were used by the bank Abbey from 2003, and transferred over to Santander following the Spanish financial services group's acquisition of Abbey in 2004.
According to John O'Brien, research director at analyst house TechMarketView, there are three reasons why the move would have appealed to Santander.
"Firstly, the average wage for a call centre worker in a lower cost region in the UK is now 'almost parity' with those seen in India. Secondly, offshoring call centres has often resulted in reduced customer service quality, and latterly increased customer attrition as other providers now offer UK-only call centres. This has become a real differentiator in the UK retail banking and mobile telecoms sector.
"Thirdly, and as important in the current economic climate, it is very good PR to be investing in the UK economy at a time of real economic hardship and high unemployment. To be seen to be putting something back in, rather than to be taking something out is likely to be a strong selling point for a brand," he said in a research note.
Business process outsourcing grew 14 per cent year on year in the last financial year according to Indian IT trade body Nasscom, with banking, financial services and insurance among the largest users of Indian BPO services.
With only hours left before his flight home to the US from Germany, businessman John Mueller suddenly realised something was wrong - very wrong.
He couldn't find his phone.
And for a global sales manager of a big biotechnology company, Life-Tech, losing his Blackberry was more than just getting disconnected from a few friends.
"I use the same phone for both business and for personal calls," says Mr Mueller, remembering that day.
"It stores my most valuable contact information, ranging from my wife and children to my boss and top customers, to keep up-to-date and in touch.
"In the world of airline travel today, we find ourselves running to and from airport gates often with little time to pull out our laptops, so the phone is becoming increasingly important."
"The fear of having no phone while travelling home, no communication tool for work, and having to report the phone to my manager and IT department as missing was too great to just accept that it was lost."
With little time left, he remembered he had downloaded an application called Lookout mobile security that promised to retrieve the phone if it went missing.
Developed by a California-based mobile security company, the software also guaranteed protection from viruses and hackers, and remote wiping of all data in case of theft or loss.
"I was not hopeful it would work but was willing to try anything, so I logged on with my laptop and pressed the 'find phone' button.
"It started with a map of the US, and within a minute I had an icon of my phone on a map of some German street names, in an area around my hotel."
Mr Mueller jumped into a cab, reached the place shown on the map and even convinced the German-speaking driver to help him explain why he was suddenly knocking on people's doors.
The second person to open their door was a manager of a taxi company - and everything cabbies found, they brought to him.
He gave Mr Mueller his phone back.
Mr Mueller and his company were lucky - but a huge number of companies around the globe are just starting to learn how to deal with the multitude of mobile devices permeating today's corporate walls.
Lookout is just one of a growing number of third-party services that try to solve the security risks posed by mobiles.
As well as apps that keep an eye on where the phone is, there are programs that try to spot malicious applications and ones that encrypt conversations to thwart eavesdropping.
If before it used to be only Blackberries given to a select few, now anyone may show up with a handset running iOS, Android, or any other advanced operating system.
And it is up to the IT department to deal with them - and to figure out a solution in case they are lost, stolen or hacked.
Consumer handsets, ranging from all types of smartphones to tablets and e-readers, have become essential work tools, successfully bridging our personal and business lives.
According to Forrester Research more than 33% of enterprises now support multiple mobile operating systems.
Such consumerisation of IT can be highly beneficial to businesses, which may find it cheaper to let employees use their own devices for work purposes instead of having to supply them with corporate laptops.
It can also increase productivity, with overzealous workers finishing reports on their iPhones while on a train home, or frantically putting a PowerPoint presentation together on a tablet while waiting to board a flight to the next conference.
But there are risks.
In these early days of our digital and increasingly mobile world, smart hand-held devices may inadvertently open corporate gates and invite criminals in.
Many executives still struggle to properly control or even acknowledge the threats this myriad of new devices poses.
A recent conference on mobile security in London held by Sophos, a UK-based global security software developer, was an example of this.
The room was full of corporate bosses and IT people, eager to learn more about securing their workers' sleek electronic companions.
"Many don't apply the same scrutiny to their mobile devices as to their PC," said Sophos security expert James Lyne.
"I suspect mainly because they've learned through experience that they can get in trouble on the PC, while the mobile device seems eminently safe."
But in reality, it is far from safe - and cyber-criminals are starting to pay more and more attention to handsets.
Just like your desktop PC, smartphone operating systems are prone to hacks - and neither Apple's iOS nor Google's Android can guarantee you absolute protection.
According to information technology research company Gartner, if one were to rank a Blackberry, an iPhone and an Android in terms of enterprise security worthiness, Blackberry would be in the lead, followed by iOS, and Android lagging behind.
Downloading a malicious application is always a risk - and while Apple's Appstore has all its software carefully reviewed, in the case of Android, anybody can submit an application.
Security software company Symantec wrote in its recent report that criminals can target your handset both through the web - by getting you to click on a malicious link or download an app containing a virus, for instance, - or through a network the mobile is using.
They can even set up a malicious wi-fi hotspot, lure you in and get access to your data.
Also, whenever you synchronise your phone with your home desktop computer or cloud services like forwarding your corporate e-mail to your Gmail account, you expose sensitive work information to systems your company's IT department has no control over.
Finally, criminals can just steal your smartphone - and since mobiles and tablets are so frequently on the move and are much smaller and lighter than laptops, they are also much easier to steal and conceal.
Hope dies last
While there are companies that take steps towards securing mobile devices entering and exiting their premises, some businesses simply hope for the best.
An executive from a Moscow-based firm who did not want to be named, told BBC News that at his company, it all comes down to a personal sense of responsibility.
"Only senior officials are allowed to access corporate data with their hand-held devices, and we just hope that they will be vigilant enough not to forget them anywhere and not to download any suspicious applications," he said.
But sometimes, hope is just not enough.
At a Belarusian company Pixel Electronics, which helps the development of small businesses, all 50 employees have a smartphone - from truck drivers to management.
"Data security is a big issue for us - and still, our company's lawyer loses her iPhone every month - I don't know how she does it, but she does it," said boss Andrei Simonovich.
"So every time, our system administrator just blocks all access from her phone to any corporate applications and documents."
Mr Simonovich said last summer, his company had decided to embrace the mobile technology, as it was cheaper than giving out corporate laptops.
But everyone who brings in his or her personal device has to get it registered with the company's IT department first, get a pass code and have anti-virus software installed.
This way, Mr Simonovich said, they try to keep "the bad guys" at bay - and their data safe and secure, even if some workers recklessly and constantly misplace their sleek shiny gadgets.
Twitter co-founder Biz Stone is stepping away from his day-to-day duties at Twitter .
Stone announced on his blog Tuesday afternoon that he is "getting out of the way" at Twitter and making better use of his time by teaming up again with another Twitter co-founder, Evan Williams, along with former Twitter product chief Jason Goldman to restart the Obvious Corp., which helped to kick start Twitter.
Obvious Corp. will focus on developing new projects.
Stone added that he will continue on part-time at Twitter, but will also focus a good part of his time helping schools, non-profits, and company advisory boards, as well as working on The Biz and Livia Stone Foundation.
"My work on Twitter has spanned more than half a decade and I will continue to work with the company for many years to come," Stone wrote. "During this time, especially lately, it has come to my attention that the Twitter crew and its leadership team have grown incredibly productive. I've decided that the most effective use of my time is to get out of the way until I'm called upon to be of some specific use."
Twitter CEO Dick Costolo will remain at Twitter's helm.
This isn't the first management switch at Twitter. Just last October, Williams stepped down as the company's CEO, making room for Costolo, who had been Twitter's COO, to take over as the company's top executive. Williams was reported to be focusing his efforts on "product strategy."
With Costolo -- known as a tech entrepreneur and overall business type -- in charge, the company recently swooped in and acquired TweetDeck . The move successfully undermined a deal that Twitter-rival UberMedia was trying to work out to acquire TweetDeck itself.
This past May, Twitter's Chief Technology Officer, Greg Pass, stepped down from his executive position and left the company, as well.
Twitter spokeswoman Carolyn Penner did not give any reason for Pass' departure at the time, but said they were not looking to fill the now empty position.
Sharon Gaudin covers the Internet and Web 2.0, emerging technologies, and desktop and laptop chips for Computerworld. Follow Sharon on Twitter at @sgaudin or subscribe to Sharon's RSS feed . Her e-mail address is firstname.lastname@example.org .
Read more about web 2.0 and web apps in Computerworld's Web 2.0 and Web Apps Topic Center.
Microsoft today announced the general availability of Office 365, the cloud version of its Office productivity suite and its most significant software-as-a-service push to date.
Office 365, which has been available in beta form since October 2010, combines Office Web Apps – Excel, Outlook, PowerPoint and Word – with web-based versions of email platform Exchange, SharePoint and Lync, which were previously part of the Business Productivity Online Suite (BPOS).
As well as bringing BPOS and Office Web Apps together, Office 365 replaces Office Communications Online and Office Live Meeting with Lync.
More than 200,000 organisations have downloaded the beta version of Office 365, according to Microsoft.
For businesses wanting to give Office 365 a try, the cloud suite is available on a 30-day free trial period, after which users will need to pay a subscription.
Microsoft today unveiled several versions of Office 365 variously tailored to small businesses, enterprises and 'kiosk' workers.
The small business version (P1) is aimed at businesses with up to 50 users and is priced at £4 per user per month.
The SME version includes Exchange, SharePoint and Lync as well as Office Web Apps but lacks some functionality such as the ability to publish certain documents (Visio, spreadsheets and forms) in SharePoint.
Microsoft has also released four flavours of the enterprise version, from E1 to E4. E1 includes Exchange, SharePoint and Lync while E2 adds the online Office apps. E3 adds licences for client-based versions of the Office applications while E4 adds PBX functionality to Lync to allow users to call people on mobile and landline phone connections as well as their contacts on the IP-based Lync.
The most basic E1 is priced at £6.50 per user per month. E2 costs £10.50 per user per month, E3 is £15.75 and E4 £17.75.
The kiosk version of Office 365 is intended for employees who only need access to basic email (Exchange), SharePoint and Office applications. There are two versions: K1 offers the basic Exchange and SharePoint for £2.60 per user per month while K2 adds the Office applications for £6.50. Despite not including the Office applications, K1 allows users to open Office documents hosted within SharePoint.
Microsoft intends to sell the kiosk version in conjunction with enterprise implementations of Office 365 so IT departments can manage the different applications using the same policies.
With cloud-based technology often causing concern around regulations on where data is held, Microsoft UK MD Gordon Frazer said that Microsoft will comply with regional regulations although it can't guarantee data won't be moved between regions.
"One of the things we're trying to do is be very transparent about where data is held. Customers will be able to see where their data is being stored. If data is going to be moved offshore we'll make sure we let our customers know about it," he told the Office 365 launch event in London on Tuesday.
British IT managers are increasingly worried about employees bringing their own iPads and other consumer devices into work, seeing it as a risk to networks and security, according to a survey.
In a Fortinet poll of IT managers released on Monday, 74 percent of UK-based respondents said the growth of user-led devices in their business — also known as the 'consumerisation' of IT — is a cause for concern. That contrasts with 57 percent in a survey of managers in Europe, which did not cover the UK.
In addition, 84 percent of British IT managers said their companies' security strategies need to be more comprehensive, to be able to cover the broad spread of devices being used by employees.
At Fortinet, just as in a rising number of offices, people are not carrying separate mobile devices for work and personal use, according to Luca Simonelli, an EMEA vice president at the security company.
"We all use one device. The problem is when we are in the company, we are relatively secure from the network point of view, but when we are in the streets, we are not at all," Simonelli told ZDNet UK. "My infections can be spread within the company."
In the UK, 47 percent of IT managers were worried about securing endpoints, such as desktops, terminals, mobile phones and tablets, according to Fortinet. For Europe, the figure was 25 percent.
To deal with this risk, some businesses open up their networks only to corporate mobile devices with security policies in place. Despite the difference in their levels of concern, 40 percent of IT managers in both the UK and Europe took this approach.
Bring your own device
Joe Baguley, the chief cloud technologist at VMware, believes that businesses should adapt to the wave of 'bring your own' devices rather than trying to resist it.
"Fighting the adoption of consumer devices by your users is a bit Canute-like," Baguley told ZDNet UK. "It's better to embrace it and see how you can make the most of it.
"We need to start the move towards not thinking about securing devices but instead securing data and the delivery of data — the ultimate goal is maybe to get to the point where you assume that every device is 'insecure' and manage to that," he added.
One such strategy is to add security into consumer smartphones via virtualisation, creating secure partitioned corporate and personal zones, Baguley argued. Both Open Kernel Labs and VMware are working on projects related to this.
"The 'street' is now accelerating technology and service delivery in orders of magnitude faster than IT departments in terms of what it can deliver to the consumer, and that is a challenge and an opportunity for our industry that is driving some fantastically exciting innovation," Baguley said.
For example, IBM believes employees now expect their company to deliver enterprise IT to them with the same convenience and accessibility as they consume services on personal devices. In addition, SAP and other companies are beginning to develop applications that take into account the consumerisation of IT.
Facebook has been ranked the UK's second-most popular website after Google, according to the latest UKOM/Nielsen statistics.
Facebook attracted a record 26.8 million visitors in Britain in May, up seven per cent year on year, beating the 26.2 million who visited Microsoft's MSN/WindowsLive/Bing sites combined, the organisation said on Monday. Google had 33.9 million.
Twitter's UK audience jumped by a third to 6.1 million, after thousands of users retweeted allegations of celebrity scandals in defiance of gagging orders, including an extra-marital affair by Manchester United soccer star Ryan Giggs.
UKOM/Nielsen said the number of women pensioners visiting the site doubled after "Giggsgate."
"The growth in audiences to these social networks is now primarily being driven by the 50-plus age group. Just a few years ago, this group may have found itself out of place on these sites," UKOM general manager James Smythe said.
He said over-50 year-olds accounted for more new adults visiting Facebook in the last two years than under-50s, resulting in an age profile far more closely reflecting that of the UK online population as a whole than previously.
Older age groups were also more likely to visit Twitter than in the past, but under-18s were less likely to visit the site than two years ago - which was not the case for Facebook.
Business network LinkedIn, whose market value has risen 58 per cent to $6.65 billion since its New York stock market debut last month, registered 3.6 million UK visitors in May, up 57 per cent from a year earlier.
Elsewhere, Facebook attracted 140 million visitors in the US, up 12 per cent. In Spain its numbers were up seven per cent, in France 18 per cent, in Italy 26 per cent and in Germany 72 per cent.
Twitter's visitor numbers rose 22 per cent in the United States, 48 per cent in France, 58 per cent in Italy and more than doubled in Spain. But in Germany they fell by 11 per cent.
UKOM/Nielsen monitored the online behavior of about 50,000 people in Britain and similar numbers in the other countries. The panel was recruited both online and offline.
Businesses in all sectors will have to tell customers when their data has been exposed in a security breach, EU justice and rights commissioner Viviane Reding has told a gathering of bankers in London.
On Monday, Reding said she will extend the breach notification obligations that already apply to telecoms and internet access companies. Such plans have been afoot for at least the last three years.
"I intend to introduce a mandatory requirement to notify data security breaches — the same as I did for telecoms and internet access when I was telecoms commissioner, but this time for all sectors, including banking and financial services," Reding said at the British Bankers' Association's Data Protection and Privacy Conference.
In support of the proposals, Reding noted recent data thefts that have hit people using PlayStation, Google and Facebook services, saying that such breaches hurt confidence in the internet and in online services.
"Only recently, we witnessed a massive security theft in online gaming services affecting millions of users around the world," Reding said. "This incident highlights why companies need to reinforce the security of the information they hold. Frequent incidents of data security breaches risk undermining consumers' trust in the online economy."
The EU vice president acknowledged concerns within the banking sector "that a mandatory notification requirement would be an additional administrative burden". However, she said the proposed measures suited the situation and would reassure consumers as to whether companies were taking care of their data.
"It would also create a stronger incentive for business to conduct serious risk assessments to protect personal data and to implement the appropriate security measures protecting the confidentiality, the integrity and the availability of personal data," Reding added.
The Information Commissioner's Office (ICO), which oversees data protection in the UK, broadly welcomed the move. However, it reiterated that the measure should apply to "serious" data breaches; in the past, it has warned against a "blanket system" that would see the ICO risk being swamped with notifications.
"Any new requirements must be proportionate, setting out clear criteria and thresholds for reporting a breach," the ICO said in a statement in response to Reding's speech.
Data breach notification requirements for the telecoms and internet provision sectors came through as part of the Telecoms Reform package, passed in 2009. According to Reding, who was responsible for much of the package's contents, the EU now needs a more coherent approach to data protection.
As the member states in the EU have their own approach to data loss, there are a variety of different approaches that companies and consumers have to grapple with in the event of a breach. The proposed reforms would introduce a "level playing field", which would benefit businesses, Reding said.
The reforms will "do away with all the notification obligations and requirements that are excessively bureaucratic, unnecessary and ineffective [and instead] focus on those requirements which really enhance legal certainty", Reding said.
UK businesses may have to follow rules that dictate they have to come clean about data breaches straight away.
European Union justice commissioner Viviane Reding outlined her plans for compulsory data breach notification for UK businesses in her speech this week at the British Bankers' Association (BBA) Data Protection and Privacy Conference.
“I intend to introduce a mandatory requirement to notify data security breaches – the same as I did for telecoms and internet access when I was Telecoms Commissioner, but this time for all sectors, including banking and financial services,” she said.
Reding outlined the extent of consultancy work which has gone into the move. Initial public and targeted stakeholder consultations were carried out last year, during which the BBA and the European Banking Federation (EBF) were involved. These activities were followed by talks with the UK Ministry of Justice, the Information Commissioner's Office and the Bar Council of England and Wales.
“The consultations have confirmed that the underlying principles of the current EU data protection legislation are still very much valid and have stood the test of time. However, it became equally clear that the EU needs a more comprehensive and more coherent approach in its policy for the fundamental right to personal data protection,” said Reding.
A key area the new legislation seeks to address is concerns over the complexities and resulting cost and efficiency of administration across EU states.
"The upcoming data protection reform is an opportunity to streamline those rules," Reding said.
She described the diversity of rules across the EU as a “huge cost to citizens and businesses alike” and said there was a need for a “level playing field” which she believes would be in the interest of businesses.
“Companies handling personal data in several EU countries currently have to meet different requirements in different Member States. This creates legal uncertainty and extra costs. The new legislation will clarify which law applies, across the EU,” she said.
Reding made it clear, however, that while she was prepared to relieve some of the administrative pressure on businesses operating in the EU she expected organisations to “do their share” in providing “safe and transparent” services.
“People must know how their data is being used. Service providers have to increase transparency on how a service operates, what data is collected and further processed, for what purposes, and where and how it is stored,” she said.
“In light of recent data theft scandals, let me add that I expect companies to do more to keep their customers' personal data secure.”
“Without this confidence, business and the economy as a whole will suffer. We have to regain that trust,” she warned.