# Security need to be proactive

According to a study by technology researcher Datapro Information Services Group only 54 percent of some 1,300 IT companies surveyed have a security policy in place, and just 15 percent use encryption to protect mission-critical data,

With companies dispatching a wide range of employees to deal with security issues, from network administrators to systems administrators or even auditors, risk analysis often falls by the wayside, leading to a "reactive rather than a proactive response to information security issues".

Although 82 percent of the respondents to a similar Datapro study in 1992 reported having a security policy, industry executives worldwide now appear to be placing less importance on the subject, Harvey said. Companies that have a plan in place reported spending an average of less than 5 percent of their IT budget on security. And 68 percent of respondents said they were concerned about security threats posed by Internet access, but only 28 percent deploy firewalls, the study found.

Most companies' security policies address dial-up access and mainframe security. Although an overwhelming majority reported addressing disaster recovery in some way, only 19 percent of respondents with a security plan have a disaster recovery blueprint in place, Harvey said. "If you haven't updated your disaster recovery plan within the last two years, you're better off throwing it in the garbage, because if you have to use it now, you'll waste so much time trying to figure out where it is out of date," she said.

The survey also revealed that 52 percent of European respondents reported having computer equipment stolen from their companies within the last year, compared with 25 percent in the United States. The survey, conducted in April, drew responses from IT companies in the United States, Canada, Central and South America, Europe, and Asia.

Althouth Bill Zachmann prononce OS/2 dead it is still very much alive…

# FAT32. User could destroy new FAT system using old NU…

Microsoft Corp.'s Windows 95 Service Release 2, which shipped to manufacturers in late September, broadens Windows 95 support for recent hardware standards. The entire Service Release will not be generally available to existing Windows 95 customers as an upgrade. Instead, Microsoft is distributing the package only to vendors of new computers. Although many of the application enhancements will be available online, you'll need to buy a new computer to get the hardware support. Microsoft does plan to put the new hardware support in Memphis, the next version of Windows 95.

Service Release introduced the FAT-32 (file allocation table) file system. With FAT-32, partitions as large as 260MB use 512-byte file clusters. Partitions from 260MB to 8GB are assigned a cluster size of 4K, and partitions of 16GB to 32GB use 16K clusters. Thus, partitions of 1GB or more can be created without wasting disk space within small files.

New file system raises some security problems. MBR and boot sector format changes make new file system vulnerable to the viruses and old disk utilities like Norton Utilities. All programs that work with hard drive on sector level, including some antivirus packages must be upgraded to operate properly on FAT-32 partitions. Symantec Corp.'s 2.0 versions of Norton Utilities are FAT-32 compliant and currently shipping.

There are also some secondary FAT-32 compatibility issues: programs have been modified to take advantage of an API call that correctly reports disk usage on large partitions. However, most current third-party applications and setup programs will now report incorrect disk usage numbers on any partition larger than 2GB.

FAT-32 partitions are invisible to other operating systems such as DOS, Windows 3.x, Windows NT, and Warp OS/2. This will make more difficult to create the dual- and triple-boot OS configurations that some users have set up to run multiple operating systems on a single computer.

Option "Boot to a Previous Version of DOS" (F4) is now disabled in Windows 95, even if a user installs only traditional FAT-16 disk partitions. (This limitation can be circumvented with batch files, provided you install a FAT-16 primary partition as drive C.)

The Advanced Power Management 1.2 services, which Microsoft has added to Service Release, include a Disk Spindown feature to reduce physical wear and tear on a hard drive, and a resume-on-ring power-management feature for 32-bit PC Card modems.

Service Release includes the Microsoft Personal Web Server, a scaled-down but functional Web

server that supports access to one domain name in addition to the local domain name. It is ideally

suited for testing Web pages locally, or for configuring a small Windows 95-based intranet. (Personal

Web Server will also be included with Front Page 97, and it is available as a free download from

Microsoft's Web site.)

Microsoft's Service Release contains a number of driver enhancements designed to bring Windows 95

up to speed with emerging PC hardware. It also contains several desktop and application

enhancements, as well as Internet Explorer 3.0.

# Norton Utilities 2.0 for Windows 95

New in the product are FAT32 support for Windows 95 and Crashguard, which protects users from losing data as

a result of system crashes or freezes. Norton Utilities for NT are expected to

ship in the first quarter of 1997. List price is $79.

# 12,14 and 16x CD ROM drives are expected in 1997…

All major manufactures will start production of 12x drives near year end. So prices of 6x, 8x and 10x drives will substantially drop. At the end of the year 8x are expected to cost $60-$80 and 6x $40-$60.

# AMD start production of the K5-PR133…

At price $1 for 1 Mhz the new AMD-K5-PR133 processors deliver system performance equal to or better than 133- MHz Pentiums (based on P-Rating tests using the Ziff-Davis Winstone 96 benchmark) and create presuure for Intel on the low end of Pentium spectre. Compatibility of K5 seems to be perfect and processor is certified by the Microsoft Windows Hardware Quality Labs to carry the Windows95 logo and has received compatibility certification from XXCAL, Inc., an independent testing laboratory.

The AMD-K5 processor is not only compatible with the Windows operating system but also with the installed base of x86 software, including Linux, Novell Netware® and OS/2 Warp operating systems, and more than 60,000 other software packages.

The AMD-K5 processor is a 4.3-million transistor device manufactured at Fab 25 in Austin, Texas, using AMD's 0.35-micron, three-layer-metal CMOS process technology. The AMD-K5 processor's fifth-generation performance is derived from AMD's independently conceived K86(TM) superscalar RISC

(Reduced Instruction Set Computing) core architecture, which combines highly efficient instruction throughput with complete x86 instruction-set compatibility. Instructions are issued four times per clock cycle through six execution units using out-of-order execution and branch prediction techniques.

Acer become the first brand name PC manufacture that will use AMD-K5-RP100 in its AcerEntra value-priced desktop computers.

In a connected event Cyrex cut price for 6x86 133+ to $98. Real price could be even lower. IBM manufacture Cyrex chips and often priced them 10 to 20% less than Cyrex official pricing.

## Lotus Notes have good sails in 1996…

First half of 1996 add 1.61 million new users of Notes, or 37 percent of all new groupware users worldwide. Lotus officials also announced today that the company sold 15,000 seats of the Notes DMS (Defense Message System) variant to the U.S. Department of Defense for use in a new system at the Navy's Naval Supply Command Center.

Company expect to reach 20 million users worldwide by the end of 1997. Domino server is now frequently used as a corporate WEB server.

# UUnet Rolls Out International Backbone Service

UUnet Technologies Inc. is now offering Internet service providers in Europe backbone services through which they can directly connect to the U.S. or between Asia and Europe. Global Transit, unveiled last week, is available in 14 cities outside North America, with access speeds ranging from 64 kilobits per second to 34 megabits per second. In the past, ISPs abroad had to run transnational circuits to reach a U.S.-based backbone. UUnet now operates redundant DS-3 (155-Mbps) links between Europe and North America. UUnet can be reached at www.uu.net Netscape Communicator Clears Way For Universal Adoption

## Netscape Communications Corp. is focusing its development efforts on Intranets….

Netscape Communicator, a $49 suite of bundled groupware applications that will include Netscape Navigator 4.0, Netscape Composer, a HyperText Markup Language, or HTML; authoring tool; Netscape Messenger, an e-mail client; Netscape Collabra, newsgroup discussion software; and Netscap Conference, an Internet telephony device that can be used as a collaboration tool.

A Professional version of the software package selling for $79 also includes Netscape Calendar's scheduling, Netscape AutoAdmin for centralized management by management information services, or MIS, professionals. Netscape also announced a corresponding set of servers that support the clients on the back end of Intranet networks. With the introduction of the Communicator, the Netscape Navigator will no longer be available as a stand-alone product.

In unveiling its new strategy, Netscape's co-founder and senior vice president, Marc Andreessen, said, the company was now positioned to take advantage of the next phase in the growth of Internet technology.

"In 1995, Netscape led the first wave of the Internet with the explosion of the Web. In 1996, we led the second wave as Web technology penetrated the corporation with rapid adoption of Intranets," he said. "In 1997, Netscape will once again lead the industry with Internet technology that combines the richness of Web content with enterprise applications producing the next killer applicationWeb-rich e-mail and groupware."

Examining Netscape's announcement, Gartner Group analyst Neil MacDonald said the company was headed in the right direction. "Once you've solved the issues of compatibility with legacy applications and announced that you'll adopt the standards of one of the computer industry's leaders then you've eliminated any reasons IT managers would reject you out of hand," he said. "Netscape can now compete with Microsoft on the strength of its price and the features of its products."

## Digital-analog hybrid technology doubles the speed of existing analog modems to 56 kilobits per second. U.S Robotics plans to upgrade most of its existing 28.8 modems...

Although the first commercially available modems based on the 56-Kbps technology will not be available until early next year, nearly every modem maker has announced plans to support the technology. The new technology, which is actually a digital-analog hybrid, has attracted attention because it will enable millions of analog modem users to double the bandwidth of existing modems without installing new telephone lines.

The overall market for analog modems is expected to exceed 154 million units by the year 2000, according to Lisa Pelgrim an analyst at Dataquest Inc., a San Jose research firm.

Although Integrated Services Digital Network, or ISDN, lines offer a maximum bandwidth of 128,000 bits per second, the technology is not as widely available as analog service and requires the phone company to install new phone lines. Of the four companies that will be offering chips that modem makers will use to build these high-speed modems, U.S Robotics may have the early advantage. Instead of requiring consumers and ISPs to purchase new equipment, it plans to upgrade most of its existing 28.8 modems.

Advertising is fast becoming the largest growing segment of the Internet

According to a new report from Frost & Sullivan. Internet advertising accounts for 3.4 percent of all ad dollars spent in 1996. The market is expected to grow to 22.2 percent, or $5.48 billion, by 2002. ``Utilizing new programming languages like Java and VRML, advertisements are expected to become more interactive, as well as being presented in animated 3-D formats. Web ads will no longer be static pages, but rather messages that are intertwined with the subject matter or information.'' In addition to advertising, the report notes that online services will experience great activity. But the onliners must provide easy Internet access combined with value-added content, the report suggests.

``Individual computer enthusiasts have flocked to the online services,

while businesses and organizations of all sizes and type have driven the

rapid growth in the Internet access industry,'' Gorton said.

The Internet, which by the end of 1995 had 10 million hosts

connecting 105,000 networks that support more than 25 million users

worldwide, has spurred this demand for Internet services.

The market can be broken down into four segments: online service

providers, Internet service providers, advertising services and

host-based service providers.

The study suggests that no single application dominates the Internet

and going forward, there will be ample room for growth.

Microsoft Corp. has hired Tetris creator Alexey Pajitnov,

Pajitnov, 41, achieved international fame in the late 1980s when he

created (with Gerasimov) Tetris. More than 40 million Tetris copies have been sold for a variety of video game and computer systems, although Pajitnov has received almost no royalties because the Russian government held all rights to the software for 10 years.

After working in the U.S. for the past six years at his own small computer games company, Pajitnov said Wednesday he was excited to be working for Microsoft as a game designer.

``It has always been my dream to work at best software company in the world,'' he said. At Microsoft, Pajitnov said he can concentrate on creating new puzzle games - his passion - without worrying about paying the electric bill.

``When you run a company of just five or six people, you have to worry about office supplies, computer equipment,'' he said. ``Frankly I am a little tired of work at a small company.''

Pajitnov, who lives in Kirkland, Wash., said he negotiated with Redmond-based Nintendo of America about going to work for the Japanese video game giant, but ``right now they don't have a very huge plan for puzzle games.'' Tetris is one of the mainstay games available for the Nintendo Gameboy, a handheld game machine. Microsoft also licenses Tetris for distribution in its Windows 95 Entertainment Pack.

Tetris was designed to work on underpowered personal computers used in Russia in the late 1980s. While modern PCs equipped with CD-ROM drives are capable of delivering realistic graphics and sound, Pajitnov said there is still a place for simple, yet clever and captivating, puzzle games.

While the machines have changed since Tetris was built, ``the human mind hasn't changed in that time,'' he said.

Pajitnov will be part of Microsoft's drive to widen the PC's popularity as a game platform, which intensified with the launch last year of the Windows 95 PC operating system - software that allowed developers to build products with 3-D graphics and speedier gameplay for distribution on CD-ROM disks.

With annual sales at about $1.25 billion, the games market is the largest and fastest-growing segment of the consumer software industry, said Alecia Bridgwater, Microsoft games marketing manager.

``The idea is to get the best talent around the world developing games for us,'' Bridgwater said. The company plans to have top selling titles in the major game categories, which include action, strategy, sports, simulation and adventure titles.

Microsoft, which has dabbled in PC gaming for years with its Flight

Simulator program, is boosting offerings to 11 with eight

## Delphy ship received huge hole lower waterline. Microsoft Corp. is hiring away key Pascal and Delphy developer Anders Hejlsberg…

There really isn't much in Borland today other than Delphi and Borland's mistake seems to be not placing enough emphasis on Delphi. Now they have lost so many key peoples to MS, than Microsoft basically eliminated any opportunities for them on the compiler market. Future of Delphy now in uncertain as Microsoft Corp. hiring away key developer Anders Hejlsberg. Hejlsberg, one of the original employees of the company, was the architect of Borland's Pascal products including Delphi. Hejlsberg follows high-profile executive Paul Gross, who was Borland's vice president of research and development, and was lured away by Microsoft in September. Gross will begin working in Redmond, Wash., in January, reporting to Bob Muglia, vice president of development tools. Microsoft has not yet settled on positions for either Gross or Hejlsberg. However, sources at Microsoft suggested that Gross may be in line to fill a spot left by Denis Gilbert, general manager of the visual languages group, who will be leaving soon for a three-month sabbatical.

Borland expects to lose $11M in Q2, lay off 15% (125 people). Last quarter, it reported a net loss of $14.1million on sales of $34.5 million.

High level executives are leaving. CEO Gary Wetsel resigned in July, and in August, Chief Financial Officer David Mullen announced his departure.

Netscape Communications Corp., decided to dump Borland's Just-in-Time Java compiler in favor of Symantec Corp.'s.

Iit's utterly disgusting that Microsoft's hach-0-matic, damn-the-architecture attitude will probably dominate the indestry for the most of my late career yers. Herd mentality of corporate software users with mee-too-ism

## New security threats from MS Applications: new file formats in all Office 97 applications …

Word, Access, Excel and PowerPoint will all have new formats in Office 97 to support a variety of new data types and technologies. The changes were necessary to support the graphics from the new Office Art tool, VBA and hyperlinks in documents. PowerPoint will be able automatically compresses files when it saves them.

There will be possibility to set default file formats and MS will provide automatic access to libraries of file converters. For example it is possible to set the default format to the previous format so that, for example, Word 97 automatically saves files in the Word 95 format. This default setting can be changed by system administrators during a rollout to provide consistency across a company.

Office 97 also has been redesigned to handle unfamiliar file formats better. Administrators now can add pointers to remote libraries of file converters. Then, if Office encounters an unfamiliar file type, it can check the library for a converter. These libraries can reside on servers or on Internet sites. MS plan to release Office 97 in December.

## Reasonably priced 3.5-inch drives in 3-7G range are available. With more affordable prices in Feb.97.

- Quantum Corp. this week announce Fireball ST, a 3.5-inch Ultra ATA drive with 6.4G bytes of capacity that will sell for $480, or 7 cents per megabyte, according to Quantum officials in Milpitas, Calif. The Fireball line, which also will ship with capacities ranging from 1.6G bytes to 4.3G bytes, offers an average seek time of 10 ms. It will ship in volume in Feb. Quantum also will ship in December the 5.25-inch Bigfoot CY at 2.1G bytes, 4.3G bytes and 6.4G bytes, with prices ranging from $225 to $395.

- Seagate Technology Inc. added two 3.5-inch hard drives to the Medalist line: the 3.2G-byte Medalist 3240 and the 4.3G-byte 4340. Average seek times of 12 ms (milliseconds). The 3240 and 4340 drives are expected to be available in Jan.
- .
- IBM's Storage Systems Division will release a 6G-byte hard drive 1st quarter of 97.

## SyQuest will compete with Iomega in 1G removable drive solutions…

SyQuest Technology Inc., will announce the 1.3G-byte SyJet removable cartridge hard drive later this month or early next month. The external model is priced at $499, and the internal model is $399. Additional 1.3G-byte cartridges will be priced at $99.

# Borland sell Paradox to Corel.
Corel plan to add WEB capabilities in next version

Borland International have sold Paradox desktop database to Corel Corp. Paradox in already included in Corel Office Professional suite. Corel plans a future version of Paradox with Web capabilities and support for Delphi.

# Corel Office Professional 7 - $20 instead of $200…

The rep-seat cost of for M$ Office is more that $200. At the same time Corel Office Professional 7

cost $20-$60 per seat and has better spreadseet(Quattro Pro) and better database (Paradox)brings together enough. The most critical of the 18 applications in the suite are: WordPerfect 7; Quattro Pro 7; Paradox;

illustration module of CorelDraw 6. Inso's Quick View Plus, which integrates with other programs' file dialog boxes to provide one-click viewing of hundreds of file formats, is an underrecognized wonder.

# Friction in ABM club (Anybody But Microsoft Club)

Oracle and Netscape are charter members of the We Hate Bill club. They have important joint projects like the Network Computer. At the same time Oracle founder Larry Ellison for some reason decided to help M$ and is proclaim that Big Bad Bill will crush Netscape. Frictions like this greatly damage the coalition that was formed to overcome the dominance of the Wintel platform.

DON - None of us, any more, is exempt. All of us are snarled

in the systems of computers, all pay our dues to cyberspace, snuffling

around in our own patch of it.

Every time you stick a bit of plastic in a machine, or pay a bill, or

communicate with an organization, you leave your tracks in it.

But what is it exactly?

William Gibson, the science-fiction writer, is the poet of cyberspace.

His achievement is not merely to have named it. (``Cyberspace'' made

its first appearance in his first novel, Neuromancer, published in 1984,

whose sales are now in the millions.) He has made that darkness in

which all of us now pad about like moles, visible.

What Gerard Manley Hopkins did for the flight of the falcon, Turner

for fog, Dali for the unconscious and William Burroughs for a brain

deranged by junk, Gibson has done for the digital dimension. He has

painted it for us so vividly and persuasively that those dreary

keyboards and screens can never be the same again.

``The matrix is an abstract representation of the relationships between

data systems,'' he starts off drily enough in his 1985 story Burning

Chrome. ``Legitimate programmers jack into their employers' sector

of the matrix and find themselves surrounded by bright geometries

representing the corporate data. Towers and fields of it ranged in the

colorless nonspace of the simulation matrix ... Legitimate programmers

never see the walls of ice they work behind, the walls of shadows that

screen their operations from others ...''

It begins soberly, but once the adrenalin starts churning it's a tour of

the mountains of the moon on acid. The talent of Bobby, Burning

Chrome's anti-hero, is to break into data systems by destroying these

walls of ``ice'' that protect them.

The narrator goes along for the ride: ``Ice walls flick away like

supersonic butterflies made of shade. Beyond them, the matrix's

illusion of infinite space ... This is the far side of the ice, the view of the

matrix I've never seen before ... The core data tower around us like

vertical freight trains, colour-coded for access. Bright primaries,

impossibly bright in that transparent void, linked by countless

horizontals in nursery blues and pinks...''

Sure, it's overwrought. But such passages, which in Neuromancer

encrust a fast, cruel (400 deaths), impossibly hip narrative, gave

brilliant literary form to the previously inchoate longings and urges of

the first generation of PC nerds.

If you were casting for the part of King Nerd, Gibson would be up

there on the shortlist along with Bill Gates, being tall and stooped and

narrow-shouldered, bespectacled and wry. The funny thing is that he's

far from nerdy in his preoccupations: he wrote Neuromancer on an

ancient manual typewriter, and while he's graduated to a computer for

word processing, he refuses to have an e-mail address, flinching at the

thought of all the mail he would have to wade through.

Born 48 years ago in Virginia, he moved to Canada aged 19 as a

precaution against being drafted for the Vietnam War, and for 20

years has been settled in suburban Vancouver, where he lives now

with his wife and two children.

Professionally he was a slow starter, spinning out his years studying

Eng Lit until all his cronies drifted off to law school and the like.

``When Punk arrived from London, I spent a year just watching it,'' he

says.

He began writing and selling science fiction to a magazine called Omni

in 1979-80 when he was in his late twenties. ``They paid enough

money that I couldn't stop, '' he says. Several of those stories -

collected in a volume called Burning Chrome - are among the best

things he's done. The first novel followed smoothly on.

Rarely in recent times has an author made such an explosive debut:

Neuromancer won all three of America's science-fiction awards, and

became an instant bestseller. ``Cyberspace'' entered the language, and

a mantle of cool descended on a million anoraks.

Gibson was rewarded with the nerds' eternal love. He has, for

example, a drawer at home stuffed with audiocassettes by the 100 or

so garage bands who have made recordings in homage to the book.

But given that he himself is not a Net addict, how, I wanted to know,

did these rhapsodic cyberspace passages come about?

``It's a tough question. You can find what one critic calls `passages of

heightened language' in a lot of science fiction from the Sixties on. In

order to excuse them there had to be some technological or

mythological rationale: OK, you've just gone into hyperdrive, OK,

you've just swallowed the x53 tablets and your nervous systems are

melting in rainbow colors ... I remember needing an excuse for such

passages. I had that need before I had the cyberspace idea, and I

dreamed the cyberspace idea up to allow me to do that ... My real

contribution is that I have given my readers an objective correlative for

the digital universe. I'm proud of having done that.''

And although he'd never heard of the Internet when he was writing

Neuromancer, he is also proud to be the prophet and defender of an

Internet that is free, as originally intended, of controls.

``The Internet could one day be seen as being terrifically significant:

something akin to the building of cities. It seems to me to be that

unusual.

``It's quite unlike anything that was ever done before in a number of

ways. It's immune to legislation because it's post-national and

post-geographical. Because of the reasons for its initial design and the

nature of its architecture, because it's designed to shift packets of

information in the wake of or even during a nuclear war, it's impossible

to control the flow of information within it.

``That may be the grand irony of the Cold War era: what we

remember the Cold War for is, not only did we not drop the bomb,

but we created what may one day be seen as the really major part of

the universe: this place where we increasingly do more and more of

everything we call society.''

Gibson has been called the George Orwell of the computer age, but

the parallel is flawed. The world of his books is as desperate and

eco-catastrophic as that of the film Blade Runner (it opened while

Gibson was writing Neuromancer - ``I fled the cinema after 15

minutes, deeply dismayed, because it looked exactly like the pictures

on the inside of my forehead, actually it looked better.'').

But, as in Blade Runner, the squalor and desperation have their own

kind of lurid glamour. And subverting the pessimism is a subtle Sixties'

triumphalism - for the Internet is the ultimate realisation of the

libertarian dreams of the Whole Earth Catalog types of the late

``Sixties.''

``I'm just a product of my time,'' he said three years ago.

``Computers, in a sense, were invented by acid heads. Fractal

geometry, as far as I can tell, was more or less discovered by old acid

heads looking for the mathematical formulae that resembled an LSD

hallucination.''

In his new novel, Idoru, however, a truly dark new note enters his

work. Because in this world, a generation or so into the future, the

authorities have finally succeeded in nailing the Internet down; the

fears, so current now both in the United States and here, that the

Internet's structure allows crime of all sorts to flourish, have resulted -

the ``how'' is vague - in close surveillance of everything that uses the

Net.

An article he wrote two years ago for Wired magazine foreshadowed

this dark imagining. The subject was Singapore, a place whose

authoritarianism and consumerist banality filled him with despondency.

But what worried him even more was that, as he put it, ``now they

propose to become something else as well: a coherent city of

information, its architecture planned from the ground up. And they

expect that whole highways of data will flow into and through this city.

Yet they also seem to expect that this won't affect them ... Myself I'm

inclined to think that if they prove to be right, what will really be

proven will be something very sad ... They will have proven it possible

to flourish through the active repression of free expression. They will

have proven that information does not necessarily want to be free.''

In the Japan in which Idoru is located, this dire threat has come to

pass. Yet it has not finally triumphed, because a gaggle of disaffected,

computer-obsessed youth.

osoft last week revealed some of its strategy for the next

major release of Windows 95, code-named ``Memphis.''

Microsoft now plans to push up the Memphis rollout to the middle of

next year, said Rob Bennett, a product manager for Windows 95. Its

release had been planned for about the same time as the next release

of Windows NT, code-named ``Cairo,'' late next year or early in

1998.

The new version's main feature will be full integration with the Internet

Explorer 4.0 Web browser. This integration will allow users to

transform their desktops into Web-page views and to toggle between

traditional Windows views.

However, that feature is also part of IE 4.0, which will ship prior to

Memphis in the first quarter. Industry analyst Dwight Davis, editor of

Windows Watcher newsletter in Redmond, Wash., said there may not

be enough incentive for corporations to purchase Memphis because

they can get its main feature for free with IE 4.0. Microsoft will demo

IE 4.0 at next week's Site Builder Conference in San Jose.

At least one potential user agreed. ``The more integrated Windows

gets with the Internet, the more interesting it becomes,'' said Paul

Mahowald, vice president of IS at Blockbuster Entertainment, Fort

Lauderdale, Fla. ``But there's not that much we're clamoring for

anymore.'' Blockbuster is rolling out Windows 95 across the entire

company.

Of course, in keeping with Microsoft's penchant for cramming features

into its operating systems, the integration with IE 4.0 is not Memphis'

only feature. The new version also will contain the Win32 driver

model, a common driver for both Memphis and Windows NT.

Also, Bennett said, it will feature agent technology that will monitor

user-selected Web sites and send visual alerts when changes are made

on those sites. Microsoft calls this feature SmartFavorites, similar in

name and in functionality with Netscape's Smart

Memphis also will contain all the features that recently shipped to

OEMs in the so-called Service Pack 2. These include: automatic data

recovery, which upon reboot automatically repairs any damaged files

caused when a user incorrectly turns off a Memphis system; TCP/IP

multihoming, which allows Memphis PCs to have more than one

TCP/IP stack for connections to more than one LAN; the FAT 32

advanced file system with support for large hard disks; and the Novell

NetWare 4.x redirector with support for Novell Directory Services.

Still, Windows Watcher's Davis said Memphis is not living up to

expectations set earlier this year by Microsoft executives, who

described Memphis as a truly major upgrade. Instead, he said,

Memphis sounds a lot like Nashville, the old code name for a small

upgrade to Windows 95 once planned for mid-1996.

That upgrade was later killed in favor of a product once called the

Internet Add-on, which was to have shipped by now but has been

delayed and renamed IE 4.0.

``We would characterize Memphis as a slightly bigger Nashville rather

than a slightly sooner Memphis,'' Davis said. ``Microsoft's marketing

personnel must have thought: `Why not call it Memphis and claim

we're half a year early rather than call it Nashville and be a year late?'

`` he added.

(For more Internet industry news and information, visit Interactive Age

Digital on the Web, at http://techweb.cmp.com/ia/iad-web-/ )

Netscape Communications Corp.

reported better-than expected third-quarter earnings Tuesday as

revenue quadrupled amid strong sales of its corporate Internet

software.

Net income rose to $7.66 million, or 9 cents a share, from $175,000,

or breakeven, a year ago. Revenue surged to $100 million from $23.3

million.

Wall Street expected earnings of 8 cents a share, based on the

average estimate of 14 analysts from IBES International Inc.

Sales jumped as more businesses used Netscape's products to build

intranets, the corporate networks based on Internet software, where

Netscape's products dominate those of rival Microsoft Corp.

Companies use the software to exchange information among offices

and to create electronic storefronts.

``Microsoft isn't stealing market share from Netscape in the intranet,''

said Daniel Rimer, an analyst at Hambrecht & Quist.

During the quarter, Mountain View, California-based Netscape signed

up Chrysler Corp., J.C. Penney Co. and General Electric Corp.'s GE

Information Services to use its intranet software. ``What sticks out is

that the product is real and selling and that there is a market for this

software,'' said Jim Barksdale, Netscape's president and chief

executive.

Netscape said more customers are buying the suite, or combination of

products, it began shipping during the second quarter.

The company also said it was getting more adept at using indirect

channels, including resellers and companies that include its products

with their own. Indirect sales accounted for 60 percent of revenue, up

from 48 percent in the second quarter.

Netscape shares fell 1/4 to 44 1/2 on the Nasdaq Stock Market.

Shares rose as high as 45 1/8 after the close of Nasdaq trading.

Netscape is concentrating on investing in research and development

and broadening its distribution and marketing, to keep ahead of rival

Microsoft, analysts said. Although the company beat analysts' revenue

estimates of $85 million to $90 million, earnings were still only a penny

above estimates.

``They are competing with Microsoft and trying to keep ahead,'' said

Tarun Chandra, an analyst at Laidlaw Securities.

Sales and marketing costs made up 43 percent of revenue, while

research and development was 24 percent, unchanged from the

second quarter. Gross margin rose to 85.3 percent from 84.

Browser sales made up 59 percent of revenue, down 1 percent from

the second quarter, while the more lucrative server software, used to

relay information within computer networks, increased two percent to

25 percent. Services, including advertising, fell one percent to 16

percent.

Netscape in August released the latest version of its popular Internet

browsing software. Netscape makes most of its revenue on the

browser from companies, not from consumers, and concentrates on

the corporate market.

Microsoft is fighting back. In August it released the latest version of its

Internet software. Microsoft also bumped Netscape as the browser of

choice at services including AT&T Corp., Prodigy Inc. and Netcom

Online Communications Services Inc.

Netscape and Microsoft are both developing the next versions of their

software, due out early next year. Netscape last week unveiled its

updated product, called Netscape Communicator, that turns the

company's focus more squarely on the corporate market.

Communicator replaces the browser and adds more sophisticated

electronic mail and communications programs. The company also

unveiled corresponding server products.

For the nine months, net income was $12.2 million, or 14 cents a

share, compared with a loss of $7.1 million, or 10 cents, a year ago.

Revenue rose to $231.1 million from $43.8

(The Bloomberg web site is at http://www.bloomberg.com )

U.S. health officials barred some imports of computer monitors made by Acer Peripherals Inc. at its northern Taiwan plant in Kweishan.

The U.S. Food and Drug Administration said its investigators visiting

the facility Sept. 25 found ``serious deficiencies'' in the quality-control

and testing program for computer monitors.

An Oct. 16 warning letter to Acer Peripherals, the world's

third-biggest monitor-maker, cited problems with radiation testing and

measurements at the plant. Acer Peripherals is 41 percent owned by

Acer Inc., the world's seventh-biggest personal-computer-maker.

Acer Peripherals shares dropped NT$3 ($0.11), or 6 percent, to

NT$45.1. The parent lost NT$1.3, or 3.2 percent, to NT$39.3.

About one third of the 50,000 monitors produced monthly at the

Kweishan plant are shipped to the U.S., said Jennifer Chen, a

company spokeswomen. Acer Peripherals makes another 200,000

terminals monthly in Malaysia. These aren't affected, she said.

The company sent a written reply to U.S. authorities Tuesday. ``It's

not resolved,'' Chen said. ``We're working hard on it.''

Abraham Leu, a technology industry analyst at Jardine Fleming

Taiwan Securities, said the company's profit would suffer if it can't

meet the standards quickly because its most profitable products are

made at Kweishan.

``For the short-term, this is going to be important,'' he said.

The U.S. complaint involves mostly paperwork and equipment, rather

than product design, however, and Acer may be able solve the

problem within two weeks, Chen said.

The U.S. warning letter was signed by Lillian J. Gill, director of

compliance at the Food and Drug Administration. The news comes at

a bad time for Acer Peripherials. The company last month received

Taiwan Securities and Exchange Commission permission to go ahead

with a $110-million overseas stock sale.

First-half net profit fell 10 percent from a year earlier to NT$524

million, or NT$1.76 per share, from a year earlier.

SI Details Cyber Attacks And How To

Stop Them (10/28/96)

By Jeff Sweat, InformationWeek

The Computer Security Institute has published an Internet security

manual that addresses issues related to the bewildering array of attacks

on computer data--many of which were spawned by the rise of the

Internet--that have broadsided IS managers.

CSI, a San Francisco security professional organization, has published

a manual titled "CSI Manager's Guide to Cyperspace Attacks and

Countermeasures." It comes at a time when the results of an

InformationWeek and Ernst & Young survey shows that many IS

managers are unprepared to fend off electronic assault.

Although most managers are at least vaguely aware of the risks posed

by the Internet, many have not addressed those issues because they

don't fully understand the myriad ways their system can be attacked or

the methods that can be used to prevent attack, according to CSI.

CSI's publication outlines every known form of electronic threat,

including the recent denial of service attacks, viruses, system break-ins,

equipment theft, and interception of network traffic.

The book, the latest in a 10-book series that includes manuals on such

issues as E-mail, system and network security, and Internet security, is

written by Dorothy Denning, a professor at Georgetown University. It

is available to CSI members for free and to nonmembers for $10 for

the single publication and $50 for the entire set of 10 books.

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