The Top 10 Tech Stories of 2006

Mergers, acquisitions, lawsuits, scandals, and battery recalls kept journalists busy in 2006.

Megadeals signaled realignment in the IT industry and foreshadowed the Internet’s multimedia future. A much-delayed Vista debuted amid speculation that it would be the last of the old-school, big-bang product launches. As software giants announced support for Linux, and manufacturers switched chip allegiances, the open-source and chip industries were thrown into turmoil. 2006 was a transition year, as IT giants positioned themselves for a new era of global competition in the post-PC era. Here, not necessarily in order of importance, are the IDG News Service’s top news stories of the year.

HP Spy Scandal: Board, and Broad, Implications

A board feud at Hewlett-Packard hit the newspapers in September, leading to the resignation of Chairman Patricia Dunn. The board spat erupted over an investigation to see which board members leaked information–including arguments about the ouster of former Chief Executive Officer Carly Fiorina–to the press. The company used “pretexting,” where investigators pretend to be the people being investigated in order to access private information.

Criminal charges were filed against Dunn, legal counsel Kevin Hunsaker, and outside investigators. Users are unfazed: Under Mark Hurd, CEO and newly appointed chairman, HP has overtaken Dell as the leading PC maker and IBM as the biggest IT company in revenue terms. However, the scandal has broad implications. Congress may make pretexting a federal crime. Oversight of corporate governance is a rallying cry.

Microsoft Cuts a Deal With Novell: Embrace and Devour?

Microsoft’s November deal with Linux distributor Novell created turmoil in the open-source world. Microsoft will offer sales and support for Novell’s Suse Linux, work on interoperability, and indemnify Suse users and developers from potential Microsoft lawsuits against copyright infringement.

Industry insiders say that Microsoft is driving wedges into the open-source community, protecting only some users from legal reprisals. The open-source world had already been rocked in October, when Oracle’s move to offer full support for Red Hat Linux had industry insiders worrying Red Hat’s business model would suffer. Ultimately though, the software giants’ embrace of Linux is a sign that no one can ignore open source. Microsoft CEO Steve Ballmer said the impetus for the agreement came from customers. Though that’s an old line, there’s no doubt that open source has truly come of age.

Alcatel-Lucent: M&A Mania Grows

The merger of Alcatel and Lucent Technologies, announced in April, formed a $24 billion networking giant and signaled trends in global mergers and acquisitions. The hookup was necessary to face down competition in growth areas of the mature enterprise market–such as Voice over IP–while Chinese manufacturers put pressure on the West on the low end.

2006 is expected to yield 3945 M&A deals, up from 3455 in 2005 and the highest number ever, according to investment firm Innovation Advisors. Globalization and changing demand are fueling M&A in networking, the Internet, the chip industry and enterprise software. 2006 examples include Advanced Micro Devices and ATI Technologies, Red Hat and JBoss, and EMC and RSA Security.

Google-YouTube: Convergence 2.0

Google’s ability to afford the $1.65 billion price tag for its acquisition of YouTube, announced in October, underscored its status as the Internet’s superstar revenue generator. The deal itself confirmed video’s importance in the evolution of Web 2.0: the mashing together of user-generated content and multimedia applications.

“Anybody who wasn’t interested in YouTube was either asleep or not being honest,” said Jonathan Miller, who was deposed as AOL chairman after the Google-YouTube deal.

Competitors scrambled. Lycos launched a movie-streaming service mixing elements of social networking and online video, while movie studios and TV networks rushed to put video online. Legal issues between Internet sites and content producers need to be worked out, but one thing is for sure: Convergence of video and the Net has hit prime time.

AOL Search Data Release Fans Privacy Debate

AOL’s July release of search log data on 658,000 subscribers, meant for research use, became a cause celebre in the privacy-rights debate. Coming amid reports of corporate data leaks and phishing scams, it was yet another reminder of the general insecurity of data. The AOL records contained sensitive information like Social Security numbers.

In September three people sued the company in what their lawyers claimed was the first such lawsuit seeking national class-action status. They asked the court to instruct AOL not to store users’ Web search records. But the request is not likely to be granted. Law enforcement officials want service providers to retain user logs to aid investigations, and new data retention rules may be proposed. The ability of technology to store an ever-increasing amount of data will ensure continuing debate. Jurisdictional issues also come into play as the U.S. and Europe clash over different privacy standards.

When Batteries Attack: The Great Battery Recall of 2006

It was the biggest recall in the history of IT and consumer electronics. Sparked by reports that lithium-ion batteries could short circuit and catch fire, Dell in August recalled more than 4 million laptop batteries. The move was soon followed by manufacturers around the world including Apple Computer, Fujitsu, Hitachi, Lenovo, and Toshiba. More than 8 million batteries were recalled, leading to yet another black eye in an annus horribilis for Sony, the manufacturer of the faulty cells. The recall, startup costs for the delayed PlayStation 3 game console, and poor PlayStation Portable sales pushed Sony’s operations into the red.

Mac on Intel: Chip Industry Realigns

Apple’s January launch of the first Mac PCs running on Intel chips was historic. For decades, Apple’s insistence on going its own way has been its strength, and also its weakness: the company has traded seamlessly designed products for market share … at least, until the iPod came along. But Intel chips have breathed new life into the Mac line. A 30 percent jump in fiscal fourth-quarter Mac sales helped the company generate $546 million in profit and blow away analyst expectations. The company’s profit margin is great: in their last reported quarters, Dell had more than 300 percent greater revenue than Apple, but only 24 percent greater profit.

Meanwhile, in a blow to Intel, Dell announced in May that it would for the first time use chips from Intel archival Advanced Micro Devices, in multiprocessor servers by the end of the year.

Patent Wars Singe BlackBerry

After the U.S. Supreme Court declined in January to hear Research In Motion’s appeal in its patent battle with NTP, industry watchers started sounding the death knell for RIM’s BlackBerry. A $612.5 million March agreement between the companies, however, ensures that RIM will never have to worry about NTP patent claims again.

The case is emblematic of the disruptions caused by patent disputes, which often lead to near-automatic injunctions that prevent companies from selling products that allegedly infringe on patents–even before final patent rulings have been made. Many industry insiders found wisdom in the U.S. Supreme Court’s May ruling that courts need to look at multiple factors instead of immediately awarding injunctions. The court sided with eBay in a patent infringement case brought by online auction company MercExchange. But patent wars continue: NTP sued Palm in November.

Vista Launches

After numerous delays, Microsoft in November launched Vista, along with Office 2007 and Exchange 2007.

Though Microsoft CEO Ballmer called it “the biggest launch in our company’s history,” it didn’t have that feel. Consumer versions of Vista and Office won’t be available until the New Year, thus missing the holiday buying season. The products are important: among many other things, the level of interoperability among them is greater than ever before. But the launch may go down in history for another reason: it could be the last of the traditional big products launches. With more people tapping into hosted applications, Google experimenting with Internet-based productivity applications, and users receiving a steady stream of product updates over the Web, big-bang launches may fade into the past.

Gates Steps Back … to Plunge Into Philanthropy

Bill Gates’ June announcement that he will step out of his daily role at Microsoft in July 2008 was a milestone that comes at a transition time. While he will remain chairman, Gates will focus on philanthropy.

Microsoft was rarely if ever a first mover, as for example Apple has been. But by combining technical acumen and business brilliance, Gates embodied the quintessentially American entrepreneurial knack of seizing a great idea and commercializing it beyond people’s wildest dreams. His deal to provide the operating system for the IBM PC in 1981 fueled the personal computing revolution. Over the next 25 years Gates led Microsoft to embrace the graphical interface and bring it to the masses, conquer the desktop market, and ultimately navigate the shoals of the Internet era. Microsoft faces further battles in the Internet age, against Google and other companies that will spring up. Meanwhile the Bill and Melinda Gates Foundation has assets of about $30 billion. The world watches to see if Gates can revitalize philanthropy, as he did computing.

Disgruntled Dell customer finds crafty path to lawsuit settlement


Pat Dori, a disgruntled Dell customer who found no resolution to the issue of a broken laptop after five long months and 19 wasted phone calls, decided to go legal and sue the company for failing to adequately address the problem. The method by which Mr. Dori initiated the claim is the juicy core of this story: instead of going through the normal process of sending the court papers to Dell’s headquarters in Texas, Dori thought to have the papers delivered to a Dell shopping mall kiosk instead. Quite unsurprisingly, no-one from Dell turned up in court on the stipulated date, resulting in Dori winning a $3,000 default judgment and a ruling to allow bailiffs to close the kiosk and seize items if the judgment was not paid. Dell has now settled the case out of court for undisclosed terms, although the company would have appealed the decision — had it actually turned up to court, that is. Mr. Dori, our latest hero for sticking it to the man in such a crafty manner, says that he thinks “any regular person can do this,” as long as you “have the law on your side.” Apparently the key is to “get their money” first, which will inevitably be followed by “[getting] their attention.” It’s gotta beat screaming down the phone, that’s for sure.
Read about it!

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Review: Dell’s quad-core XPS 710 tower rips it up

xps 710

Dell recently set the bar a little bit higher for top-of-the-line machines — the rigs for people who don’t care how much their computer costs as long as it’s better than everyone else’s. Loaded up with Intel Core 2 Extreme Quad QX6700 processors at 2.66 GHz and two NVIDIA GeForce 7950 GX2 graphics cards (that’s Quad SLI for those keeping score at home), the XPS 710 has more horsepower than most people will know what to do with under the hood. Which might be one of the problems. For $6,000, is it worth breaking the bank to get the fastest computer possible? I took the XPS 710 for a test drive to find out.

Goodies in the Box
So what comes in the box when you drop over $6,000? Before we get to the tower, let’s take a look at the other goodies you get. First off, we have a 24-inch widescreen 2407FPW LCD monitor, a gigantic and bright beauty of a display. With a maximum resolution of 1,920 x 1,200 pixels, text is crisp and clear and everything looks really sharp. However, it’s the same number of pixels you get in a 17-inch Dell Inspiron laptop screen. Couldn’t Dell pump up the pixels a bit for a monitor that’s a solid 7 inches larger than a laptop screen with the same count? After all, the company’s 30-incher maxes out at 2,560 x 1,600, so it seems like there could be a happy medium in there. But in any case, at 1,920 x 1,200 the monitor looks really quite amazing.

The keyboard and mouse are fittingly as top of the line as the tower itself. First you get the Saitek Eclipse II Keyboard, featuring adjustable blue lights beneath the keys to make you feel like you’re piloting a spaceship when you’re checking your e-mail. If the lights get too bright or annoying for you, the knob in the upper right-hand corner of the keyboard will tone it down for you. Other extra buttons include audio controls and a mute button. Nothing too fancy, but it’s pretty much all you’d want on a keyboard.

The mouse that’s included is the Logitech G5 Laser Gaming Mouse, and what makes it stand out above other mice (other than the extra, somewhat oddly placed, buttons), is the fact that you can adjust the heft of the device via the included weight set. Simply pop out the little weight cartridge in the bottom of the mouse and add or subtract weights to your liking. It’s a small touch, but for gamers and just people who use a mouse all day it actually makes a substantial difference in the feel of the mouse.

Down to Business
All right, let’s talk about this tower, shall we? First off, it’s mammoth. The box it came in weighed nearly 70 pounds, and the tower is just huge, standing nearly three feet high. It’s beautifully detailed with brushed steel and glowing red lights on the front of it. What surprised me the most was how quiet it is. It actually sounds like a jet engine while starting up, but after a couple of seconds it quiets down to near-silent. It’s such a welcome change from my older tower’s obnoxiously loud fans that whir all the time.

As for the guts of the machine, I hope you have a lot of data to store, as this thing comes with a dual 160-GB RAID array and a 750-GB extra storage drive. It’s safe to say that you won’t run out of room anytime soon on this bad boy. It also has two DVD drives: one is read-only and the other is a burner for copying discs. Pretty much all the trimmings you would want aside from something insane like a Blu-ray drive or something, which let’s face it, no one really wants anyways.

Early Edition
So how does it actually perform? Well, for your standard computing tasks, like using the Web and running basic office programs, it’s certainly swift. However, it’s not noticeably faster than a dual-core machine, or really even much faster than an older 3.4-GHz Pentium 4, which my 18-month-old desktop is running.

But games are what this thing is built for, and games it can run well. Of course. Games like Elder Scrolls IV: Oblivion, Doom 3, and Unreal Tournament 2004 look amazing on the XPS. The draw distances — how far into the distance you can see things like mountains and buildings before they pop out of the “fog” — are as far as the eye can see, frame rates are sky high, and the resolution is maxed with all effects on. You really can just pump up all of the settings on this and it won’t even hiccup.

However, again, these games all look pretty damn good on a dual-core system for less than half the price. The fact of the matter is there aren’t many programs or games out there that’ll take advantage of a quad-core machine with Quad SLI graphics cards. What you’re paying for with this box is not the ability to play today’s hottest games really well, but to play tomorrow’s games really well. When games are engineered to take advantage of everything this has under the hood, it’ll blow dual-core machines out of the water. However, currently there just isn’t much out there that really makes this machine seem worth the massive price tag.

At the End of the Day…
It seems to me that the smart move would be to hold off until there’s software out there that can actually take advantage of this technology. By that time the price of quad-core boxes will have plummeted, and rather than having a race car with no track to drive it on, you’ll be able to take full advantage of everything it’s got right away. There’s no denying that the XPS 710 is one of the fastest and most impressive machines available today. The question is just whether or not it’s worth spending so much money just to be the first person to have one.

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Dell unveils big LCD screen you can actually afford

dell 20in lcd

Big ol’ LCD monitors are a beautiful addition to your computer setup, and there’s nothing sweeter than replacing some giant clunker of a CRT monitor with something that takes up a fraction of the space. Unfortunately, big LCDs tend to be pretty expensive. Dell, maker of some of the finest LCD monitors in the land, has just released a nice big LCD for those of us on a budget. The E207WFP is a 20-inch screen with a solid 5ms response time, and the best part of all is the price: $289. If even that’s too rich for your blood, just tell your boss it’ll help your productivity. There was a study! Come on. Also, it’ll make World of Warcraft look really nice.

Dell, via Engadget

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