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(IDG CALCULATED RISKS GATES NEW ROLE PROTECTING CUSTOMERS COMPUTERWORLD Find out how IT innovators place successful bets Microsoft chairman appoints Steve Ballmer CEO Ralph Nader warns that digital signature legislation in Congress on bleeding-edge technology. Page 52 and takes on software architect mantle. Page 6 might leave consumers at risk. Page 32 THE NEWSPAPER FOR IT LEADERS =» WWW.COMPUTERWORLD.COM Il SPENDING LETS AOL DEAL ABETS at $350 billion, see themselves positioned to offer broadband RICHER CONTENT access and to speed develop- LOOSE, POST-Y2K | ment of the Internet and inter- active content, according to a Buyout expected to joint statement. And that could | spark changes in the way com- boost broadband access | | spiatneis esa imdeeds igatn coannsdu meburisl.d Web || Scarcity of Y2K problems leads many sgeevaerrsa l or dceopmaprta niaelst ogethsewri tchin BY LINDA ROSENCRANCE “When it comes to designing companies to end systems lockdowns post-Y2K job shuffles. Last week’s. stunning an- Web site content, the increas- | And all around, the mantra nouncement that America On- ing use of broadband devices | seems to be speed, speed, line Inc. will acquire Time | to access the Internet [means BY THOMAS HOFFMAN self-imposed Y2K systems speed. Warner Inc. may companies] will have | AND JULIA KING lockdowns and are moving full- Retail giant Sears, Roebuck change the way com- to produce more rich | Call it the January thaw of the steam ahead with information and Co., for example, is already panies develop their media like we see on | Y2K freeze. | technology projects that had in the thick of jeveloping a Web pages, by speed- television,” said Dan | Big companies such as Sears been put on the back burner. new freight tracking system, ing up the develop- MacKeigan, a senior and Allstate, which have expe- | Still others are busy posting which, like all IT projects to be ment of high-speed Internet Internet analyst at Arlington, rienced few if any Y2K-related | press releases and nailing up launched by the retailer this access and possibly rekindling Va.-based Friedman, Billings, | glitches, have started to end | new door plaques as CIOs at IT Spending, page 93 “browser wars,” Web develop- Ramsey & Co. ers and analysts said. Tom Lix, president and CEO If the all-stock deal is suc- | of NewMarket Network, a| cessful, the companies, valued | AOL Deal, page 16 WEB SITE UPGRADES: BUILD OR BUY? replace the Microsoft Corp. Growth puts e-suites Site Server-based system that te astonishing under new scrutiny | gave the New York-based re- that these rail- tailer a quick and relatively in- expensive entry to the Web. roads can lose BY CAROL SLIWA Both plans illustrate the dif- Britannica.com Inc. is consid-| ficult choices companies con- 100-unit coal ering scrapping its Open Mar- | front as they expand or create trains for days ket Inc. catalog software be- | online business sites. Either cause it thinks the they can build and Alarm ets Cen off-the-shelf package maintain their sites, isn’t flexible enough tailoring them di- DIANE DUFF, EXECUTIVE to handle the content rectly to their needs DIRECTOR, ALLIANCE FOR customization the as long as they have Ue ath ee) company now wants the resources to do | DERAILED to do. it, or they can launch | VitaminShoppe.- a site rapidly using com is already work- an off-the-shelf e- ing with a consul- commerce suite and | tant, weighing a hope it won’t require Unix-based, _— data- MICHAEL KRUPIT: too much customiza- base-driven Web site Proprietary tools tion or limit their op- | that most likely will have helped CDNow Build or Buy, page 16 | HE JUNE MERGER OF NORFOLK SOUTHERN and Conrail has been a spiral of mishaps — misrouted trains, congested tracks, lost cargo and lost customers. It all started with a botched effort to Lelsldastecceld[acsctlelberstlestecliballlial SBXBBIFT# SEEECAR-RT SORTHIB-O52 integrate computer systems at the two railroads, reports Kim S #48106UIZ984P20058 OCT 88 981 9888 Nash. Some of the technology glitches have been fixed, but UMT 164 |e ven seven months after the merger, crews are still misscheduled, and cus- UMNT NEWSPAPER | tomers are still temporarily losing their products somewhere on 21,600 PO BOX 984 ANN ARBOR MI 48106-0984 || miles of track. Story begins on page 20. For Non-Stop Availability, Just ARGServe/T. It's not a question of if you’re going to crash... but when? Hardware failure, service interruptions natural disasters, malicious acts...all can bring your business to a halt. When you ARCserve"/T,” you can rest easier knowing that an integrated high-availability solution is helping to ensure continuous access to data, even if your server suffers catastrophic dam- age. How? 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Page 50 } : i: a A new activist group is | targeting child pornography 4 3 La on the Internet and feels justified in killing offending servers if it has to, says spokesman Kent Browne. Page 40 JANUARY 17, 2000 NEWS Q BUSINESS 4 TECHNOLOGY 4 MILLIPORE FINDS that 40 CONDEMNED.ORG fights 64 A CREDIT BUREAU uses Oracle’s vision of a global ERP child pornography on the thin-client applications to system requires a huge amount Internet. ease customer access to its RATES ARE of work. 42 SIEMENS ELIMINATES database. GOING TO GO STEVE BALLMER replaces duplicate accounting services CATHAY PACIFIC invests in Bill Gates as Microsoft CEO in an effort to cut costs. an intranet to provide main- UP A LOT AND, amid rumors ofa Microsoft 90 frame access to employees breakup. WHAT WILL corporate IT worldwide. look like in 2010? Radically LARGELY, [IT LOTUSPHERE 2000 high- EDS TEAMS with Ariba to different from the way it looks offer Web procurement sites today, say analysts. lights Web application tools SHOPS] ARE for big corporate customers. this week. FLEET DESCRIBES what it CIVIL LIBERTIES groups was like for employees during HANDS ON GOING TO WE REVIEW two multi- blast the new encryption regu- the Y2K rollover and discusses lations released by the U.S. its plans for the future. function printers, ergonomic GET mice and keyboards. Department of Commerce. INTEL UNVEILS speedstep tIhTe IbNenNefOiVtsA TofO RneSw mteacxhinmoilzoeg y QTCUPI/CIKPS TURDUYL ES modern SCREWED. technology for laptops, which while minimizing the risks networking, shaping key IT approaches desktop speeds. Y2K ACRONYM makes a management practices. ANALYST, META GROUP INC., NOVELL WANTS TO BE an mess of rules for abbreviation, A GARTNER ANALYST SAYING THE SHORTAGE OF WEB abuptp liitc awtoino’nt sperrovviicdee pdreotvaiidlesr , LarAguWeYs EJRarSg on ADJuVdIgeS.E extreme asdhvoiusleds aodno pwt heMni croors owfhte’st heArc IT COARNNEDSS UOLLUTORAWCNEETRSS QAUWRIAELL LI STYTI RNECATRSC EHAAESVDEA ILPTARHBIILNCE E S until later this year. caution when developing a tive Directory. SEE PAGE 91 TEEN-AGERS STEAL user product of your own invention COMPANIES LOSE cus- accounts from Internet service QUICKSTUDY tomers when they fail to providers and attack govern- 58 IT ADOPTS risk-management respond to e-mail queries. ment sites. practices to secure data online. One company has a solution. RAILROADS CONTINUE to i wee Ba, wd lose money seven months after MANUFACTURERS could CONSUMER ADVOCATE merger because of botched IT * integration. be moving to simpler, faster Ralph Nader says Congress 28 THE AOL/TIME WARNER software, which will mark the must protect consumers in any IT INDUSTRY would benefit merger could make life diffi- next stage of IT innovation, digital-signature legislation. from a Microsoft split, says cult for corporate IT, Mark says Allan Alter. COMPANIES should buy International Data Corp. Hall writes in this week’s U.S. COMPANIES wii rather than build dot-coms to MORE editorial. be saving $30 billion this year keep up in today’s Internet Editorial Letters. ... 28,29 A NEW DECADE means a by not having to deal with economy, says Kevin Fogarty. How to Contact CW ......92 different approach to leader- Y2K. John Gantz says IT PETER G. W. KEEN ques- SE BN ee ene ens ..94 ship for IT managers, writes should use that “windfall” tions IT’s readiness to take on Stock Ticker Wharton School professor while it basks in stronger the inherent business chal- Company Index Michael Useem. credibility. lenges of e-commerce. www.computerworld.com NEWS ~ COMPUTERWORLD January 17,2 000 Move to Single Global ea BP Amoco in $200M ERP System No Easy ‘Task Outsourcing Pact British oil company BP Amoco PLC last week expanded its finance, mised the new ERP release For example, users with a accounting and information tech- Implementing Oracle’s centralized vision would be ready last fall but single global system “can’t take nology outsourcing contract with requires tremendous work, says user then ran into delays. a sort of backwater operation New York-based Pricewaterhouse- Oracle last week said an 18- and install new technology Coopers in a 10-year, $200 million month project to put all of its there to see if it works,” he deal that includes the company's BY CRAIG STEDMAN was completed last month. internal operations on one Re- added. “It’s all or nothing.” Canadian operations. Dan Kane, a SERS WHO plan Still to come, Dapcic said, is lease lli-based global system That’s one of the reasons spokesman for BP Amoco, said he to follow Oracle a database upgrade, a switch remains on track for comple- Millipore plans to move ahead expects the outsourcing arrange- Corp.’s new road from Oracle’s green-screen ap- tion by the end of this year. cautiously, Dapcic said. Anoth- ment to reduce the company’s total map for central- plications to its Web-based But Lance Travis, an analyst er big concern is how much its costs by as much as 30%. izing their global software and heavy amounts of at AMR Research Inc. in systems will be strained by enterprise resource planning testing to gauge how well the Boston, said he’s skeptical that switching to Oracle’s graphical Auto Web DPEeDOa lSsE S AAT (ERP) systems on a single centralized system will be able many users will follow Oracle’s user interface, which is re- database server may have a lot to handle end-user workloads. lead. “In theory, it sounds like a quired with Release Ili. of prep work to do first Millipore has also assigned great idea,” Travis said. “But Millipore beefed up its net- Automakers Ford Motor Co. in Dear- Just ask Millipore Corp. more than a half-dozen em there’s a lot of risk.” works by installing new 3Com born, Mich., and General Motors The maker of water-filtra ployees to spend 12 weeks Corp. switches and doubling or Corp. in Detroit launched major Web tion devices is one of the first helping Oracle's developers even tripling much of its wide- alliances last week. Ford announced users to sign on to install a sin debug a new order manage Millipore area bandwidth. But the Web- it will work with Santa Clara, Calif.- gle global ERP system that’s ment module that’s part of the based graphical interface “may based Yahoo Inc. on personalized supposed to be made possible application upgrade needed to Fuses Systems change the picture again,” said Web services and voice-activated by an Oracle application up run a single global system. Ram Prabhu, Millipore’s cor- Web access in its vehicles. GM inked grade in the next few months “We're hoping we can get a The promise porate telecommunications deals with Internet access providers Che $700 million manufac much cleaner product than we manager. “We don't have a America Online Inc. and NetZero turer shifted its European op usually do when it comes off good understanding of [its] Inc. in Westlake Village, Calif., to erations from their own ERP the production line [at Ora bandwidth requirements.” offer targeted Web marketing. server to one at company head- cle],” Dapcic said To try to get a better idea, quarters in Bedford, Mass., two Millipore is taking yet another NasGodesO averqse as months ago, leaving only its Inherent Risk lenge: Milli step: giving about one-third of Japanese unit on a separate Millipore’s goal is to test the ogy changes t the 300 heavy-duty ERP users system. Millipore executives unified system in the summer n 2OOdrr ascylset em. Ihe compa in its manufacturing opera- Nasdaq Stock Market Inc. in New last week said putting every and go live with it by October, tions a Windows-based ver- York has formed a joint venture with thing on the U.S. server should he said. The company wouldn't sion of Oracle’s software to a software developer in India to cre- reduce data center costs and disclose how much the whole start performance testing be- ate Internet-based trading systems give end users a unified view project is expected to cost. fore Release lli is available. D aimed at supporting Nasdaq-Japan of the company’s business. The order management soft MOREONLINE and Nasdaq-Europe when those But getting there won't be a ware is due in May, and the rest electronic markets go live next year. simple task of Oracle's Release lli upgrade For more coverage of Oracle and enterprise TMhaer kejtoisn,t cwiolml pbaen ys,u ppcaolrlteedd Inbdyi gSoS-I Proceeding With Caution mii so ntshu. ppoOsraecdl e toor igisnhaillpy nperxot wrewswo.ucrocem puptlaenrnwinogr,l dv.icsiot mo/umro rWee b site Technologies Inc. in Chennai, India. Millipore has already done heavy lifting on both the busi- Short Takes ness and technology sides, and Travel Site Faces Integration Challenges there’s plenty more that needs to be done before the unified James R. Kinney, longtime CIO at system can become a reality KRAFT FOODS INC. in Northfield, late this year. Inc. It will offer prices equal to travel sites like Travelocity.com The 27 airlines lll., has announced plans to retire The project team plans to or lower than those available and Expedia.com because the in March. Steve Finnerty, Kraft's tread carefully to try to make use myriad systems from other travel sources, offi- new site will offer consumers vice president and chief technology sure “that we're not selling cials said. the Internet-only fares that un- officer since 1998, will succeed something we can’t deliver,” But good news for cus- til now have been available only Kinney. . . . New York-based said Michael Dapcic, manufac BY STACY COLLETT tomers is not-so-good news for from individual airline sites. BARNESANDNOBLE.COM LLC CEO turing business systems man The travel megasite under de- the Web site’s information “This [technology] will be Jonathan Bulkeley resigned last ager at Millipore. “We have a velopment by four U.S. airlines technology staff, which is now unique in offering [Internet- week to pursue interests in other very sensitive user base, and got a huge boest last week after challenged with linking the only} inventories,” said Ben internet companies. . . . SAP AG they're very unforgiving when 23 U.S. and foreign carriers myriad global distribution sys- Burnett, a Chicago-based vice said John Milana resigned as chief it comes to response times.” signed on as associate mem- tems used for ticketing. Each | president at The Boston Con- financial officer at its U.S. subsid- Steps the company has al- bers. But the added support will system contains different data sulting Group, which is devel- iary. . . . Struggling Netherlands- ready taken include a six leave IT with a big headache. formats, database formats and oping the site. based BAAN CO. lost its second top month effort to create a com- Nicknamed T2, the Web site a hodgepodge of custom appli- Developers plan to launch executive in two weeks with the mon accounting structure for is a joint project of UAL Corp.'s cations developed for each the site by midyear, which in- resignation of Chief Financial Offi- Millipore’s business units and United Air Lines Inc., Delta Air user, observers said. dustry watchers said is a rea- cer James Mooney. . . . NOVELL an overhaul of the company’s Lines Inc., Northwest Airlines These technology issues are sonable goal — with some INC. shipped NetWare 5.1 last week. network infrastructure that Inc. and Continental Airlines different from those faced at patchwork. D APPLICATIONS ON DEMAND How do we manage our growth? hired Corio. Vertical Networks, Inc. knew they would need top tier business applications to manage their incredible growth. Corio offers leading applications such as Siebel, PeopleSoft, Commerce One, BroadVision, and Cognos—all fully integrated. Simply access any of these applications over a secure network for a monthly fee. No big investments. No integration costs. No IT worries. Now Vertical Networks, Inc. can focus on their business—and let Corio do the rest. Get this IDC written white paper FREE! Call CORIO at 877.267.4627 er company and product names f t@spective owners. or visit www.corio.com NEWS ~ COMPUTERJaWnuaOryR 1L7,2D 0 00 Ballmer Becomes CEO of Microsoft Gates to lead software development; move aInn c. anianl ysSta n at JoGsea,r tnceirt ing( srSouunp tpioosnes . [Mhiecrreo]s afits’ s to “wfhroeleeze putrh-e aignegr Iantc .L oaidn KJaicnkgs onMvainlulfea, ctuFlra-., could help Redmond in antitrust talks Microsystems Inc.’s upcoming developers, to keep the devel- said he doesn’t believe Gates’ StarPortal, as well as Desk- opers looking at Microsoft and new role will make much of a top.com Inc. and Halfbrain.com not at the other technologies difference. “I don’t think really BY KIM S. NASH ing Microsoft’s product teams Inc., two start-ups that provide out there,” he said. any of their business practices PATRICK THIBODEAU in a new oftware initiative, virtual “Webtops” with applica Dave Snider, a network man- will change,” he said. D AND DOMINIQUE DECKMYN dubbed Next Generation Win ILL GATES stepped dows Services. The plan won't Redmond Loses a Round in Permatemp Suit down as Microsoft be fully disclosed until April, Corp.s CEO last and products are slated to ship week to take ¢ harge gradually during the next three of a new “end-to years BY CRAIG STEDMAN Numbers Game end” software plan designed to The blueprint calls for creat AND CHRISTINE McGEEVER infuse all Microsoft products ing software that meshes a per Employers of high-tech con with Internet capabilities son's online life with his desk tract workers are being urged to Rulings on how many temps might bee ligible for Microsoft benefits: Microsoft President Steve top applications. For example, re-examine their benefits poli # A US. District Court judge in Seattle ruled that only about 300 Ballmer succeeds Gates as a Web server-based applica cies after Microsoft Corp. lost temps employed at Microsoft between 1987 and 1990 could CEO; Gates will remain chair tion could track an executive's another legal round over its claim the right to buy stock at discounted prices. man of the company airline flights and automati- treatment of so-called perma ® The 9th U.S. Circuit Court of Appeals in San Francisco over- The announcement came at cally notify his family by pager temps turned that decision last spring, opening the case to include up the end of a week of rumors that he would be late getting The U.S. Supreme Court last to 10,000 people who did work for Microsoft from 1987 on. and published reports alleging home, Ballmer explained. week rejected Microsoft’s ap that the U.S Department of Microsoft also plans to offer peal of a lower court’s ruling had worked at least five months years ago, the court denied an Justice proposed breaking up its entire product line both as that as many as 10,000 tempo in any 12-month period. Micro- appeal on the issue of whether the company during antitrust shrink-wrapped packages and rary workers should have been soft argued that the eligible temporary workers at the com- settlement talks (see related by subscription over the In allowed to buy the company’s group should be much smaller pany qualified for any benefits. story, page 24). The Justice ternet, Gates said (see story, stock under an employee dis It was the second time the The Microsoft case is being Department declined to com page 14) count plan The ruling stated high court rejected a Microsoft closely watched by technology ment on possible remedies Rival companies are ahead of that Microsoft had to open that appeal in the class action suit, industry groups and legal ob- Both executives insisted that Microsoft, said Chris LeTocq, stock plan to permatemps who which was filed in 1992. Two servers because it could force the changes have nothing to do companies to offer some bene- with those talks. But some ob Microsoft Settles Caldera Suit for About $155M fits to temporary and contract servers said the new software workers who are hired for plan sends a signal that Micro long-term assignments. soft is more adamant than The Supreme Court’s deci- ever about blurring the lines certainty in any legal case. We sion should push other compa- Move unlikely to impact antitrust talks between its operating systems, would have been comfortable nies - and not just high-tech applications and the Internet moving ahead, but we always vendors “to make sure One of Ballmer’s first acts as BY KIM S. NASH ities between Windows and look for a way to come to a fair they’re not exposing them- CEO was to accuse the federal Microsoft Corp. last week paid DR-DOS, which Caldera now settlement,” he said. selves to the same kind of law- government of being sneaky. at least $155 million to settle owns. Microsoft, which con The deal is unlikely to affect suits,” said Ken Dort, a partner “T believe the leaks are delib 1 private antitrust lawsuit sistently denied the charges settlement talks in the federal at technology law firm Gordon erate. I don’t think there’s any brought by Caldera Inc. had tried unsuccessfully to get government's antitrust case & Glickson LLC in Chicago. doubt about that,” Ballmer The settlement isn’t expect- most of the case dismissed. against Microsoft, said Mark The Information Technolo- said in a press conference. “It ed to influence separate anti- The settlement, Schechter, a lawyer at gy Association of America would be absolutely reckless trust settlement talks now signed three weeks Howrey & Simon in (ITAA) in Arlington, Va., and irresponsibie for anyone to under way between Microsoft before a trial was set Washington which filed a friend-of-the- try to break up this company. It and the U.S. Department of to start, leaves sever- That’s because the court brief supporting Micro- would be unprecedented and Justice (see story left). al questions unan- US. Department of soft, blasted the Supreme the single greatest disservice The settlement value wasn’t swered. Chief among Justice is looking for a Court’s decision. “This is a that anybody could do to con- revealed, but Microsoft said it them: Did Microsoft resolution that would 19th-century court making out- sumers in this country.” will cut into quarterly earnings strong-arm PC mak- “limit Microsoft's abil- dated decisions about a 2lst- But if Gates’ decision to by 3 cents per share. That puts ers into favoring its ity to engage in con- century workforce,” said Har- change management roles the value of the deal at at least versoifo DOnS? duct designed to main- ris Miller, ITAA president. means he’ll have less involve- $155 million. “I have mixed BRYAN SPARKS: tain its monopoly The suit must go back to U.S. “Mixed emotions” ment with the lawsuit, it could emotions,” said Bry- position,” said Schech- District Court in Seattle for fi- improve the settlement odds, DOS Duel an Sparks, CEO of on quick settlement ter. The Caldera settle- nal decisions on issues such as according to Harvey Safer- Orem, Utah-based Caldera, a Lineo Inc., a Caldera spin-off. ment, which was strictly mone- how much discounted stock stein, an antitrust lawyer at Linux and embedded systems “We came up with a number tary, “doesn’t do that,” he said. workers should be able to buy. Fried, Frank, Harris, Shriver & developer, sued Microsoft in that if [Microsoft] met, we If damaging evidence had A Microsoft spokesman said Jacobson in Los Angeles. July 1996 for allegedly using its would settle. And in a single surfaced during the Caldera the vendor is “disappointed the monopoly power in operating day, they [did].” trial, it could have given more [Supreme Court] has decided New Job for Gates systems to unfairly squelch Microsoft wouldn't have set- ammunition to consumers sep- now is not the time to review Meanwhile, Gates created a competition in the DOS mar- tled had it not feared evidence arately suing Microsoft in a the issues raised in the latest new position for himself: chief ket. The suit accused Micro- Caldera planned to present, a pile of class action lawsuits. At appeals court opinion.” software architect. He plans to soft of illegally tying its MS- Caldera spokesman claimed. least 76 such suits — including But he said Microsoft doesn’t spend 100% of his time on DOS to Windows 3.1 and inten- Not so, responded a Micro- two last week — have been expect the decision to have a technology development, lead- tionally creating incompatibil- soft spokesman. “There’s un- filed since November. D | big impact on the case. D rT Limai s\Kla VG Sfni i Phe Naa ad Lol it’s e-business or out of business. 65 of the Fortune 100 run Oracle for e-business. ORACLE" SOFTWARE POWERS THE INTERNET ™ www.oracle.com EDS, Ariba To Offer Web-Based Procurement Sites Buying Benefits Win 2K Virus Detected Offers an IT staff that’s Symantec Corp.'s Antivirus Re- dedicated to maintain- search Center said it has found a negotiators, and they know ing purchasing systems Effort aims to lower costs with efficiencies virus that targets Windows 2000, how to strike a good deal [with Streamlines purchasing Microsoft Corp.'s unreleased oper- suppliers].” costs by standardizing ating system. BY LEE COPELAND ba’s procurement network EDS, Bethlehem Steel Corp., on one electronic form Known as Win2000. Install or LECTRONIC DATA since last February. Spray said The Clorox Co., Kellogg Co. W2K. installer, the virus inflicts no Systems Corp. sub the system made transaction and eight other firms have Lowers the price of damage. Cupertino, Calif.-based sidiary CoNext and processing more efficient by signed on to participate in the goods via volume Symantec said it updated its Ariba Inc., plan to using electronic forms and of first of 12 planned sourcing net- antivirus software last week to co-develop Web- fering one spot for users to or works, with the first site launch Eliminates the need to recognize and eliminate the virus. based business-to-business der goods. slated for June. The next four strike individual deals procurement sites for big cor- ‘he other efficiencies are networks — one each for com with suppliers Schwab BuysB ank porate customers, the firms important, but the real upside panies in Asia, Europe and said last week. is the environment of competi- South America and a fourth tium. Participating buyers will CoNext and Ariba want to tion we're building with our for industry-specific procure- install Ariba’s software and Charles Schwab Corp.'s $2.7 billion create what they call Lever- supplies, and we expect that to ments — are expected to open electronic purchasing forms purchase of New York-based U.S. aged Sourcing Networks for translate into lower prices,’ for orders later this year. on their intranets and pur- Trust Corp. will give Schwab access more than 400 companies. The Spray said Ariba and EDS will charge chase supplies via a Web to very wealthy clients and give U.S. networks will offer a wide Deal Makers registration and per-transac- browser. The deal calls for EDS Trust access to more advanced range of goods and services tion fees to firms that buy in Plano, Texas, and Ariba in technology, analysts said last week. from office supplies and com EDS has demonstrated that goods through the network. Mountain View, Calif., to swap “This is a swap - products and ser- puter systems to travel and en it can lower costs by driving ef. Company officials declined to stock warrants. EDS could gain vices for advanced technology,” ergy services — for purchase ficiencies into many business provide specifics. a stake in Ariba of up to 7.3% said Amy Butte, an analyst at New and auction processes and managing sys Ariba operates an extensive depending on the revenue York-based Bear, Stearns & Co. Greg Spray, the director of tems effectively, said Stan Lep online catalog of office sup- stream generated from the pro- operations procurement at eak, a vice president at Meta plies that will be tailored to curement sites, while Ariba Intel's in the Black Hewlett-Packard Co. in Palo Group Inc. in Stamford, Conn. meet the specific purchasing could gain a 5% stake in Alto, Calif., has been using Ari- “Theit consultants are better needs of each buying consor- CoNext. dD Intel Corp. reported fourth-quarter revenue of $8.2 billion, up 8% from Insurer Bets on Intel Server uled to run under Windows relatively inexpensive Intel the fourth quarter of 1998. For the 2000 on the new server will be servers and the central man- year, the company reported revenue tested on smaller four-way and agement capabilities promised of $29.4 billion, up 12% from 1998. eight-way systems before be- by Windows 2000. Intel said acquisition-related business capabilities ing put on the ES7000 “Server consolidation is go- costs resulted in net income of $7.3 32-processor box to The company will also roll ing to be a big story,” said billion in 1999, up 21% from $6.1 run Windows 2000 out two new applications: a Cautious Approach Joseph Ferlazzon, an analyst at billion in 1998. Web-based claims processing “We are taking a very cau- Technology Business Research application for 1,200 indepen tious approach.... It is going Inc. in Hampton, N.H. Lufthansa Picks SAP BY JAIKUMAR VIJAYAN dent agents and a policy ad to be some time before we put The Unisys ES7000 — Penn National Insurance is the ministration system. any production applications priced from $150,000 to mere first U.S. customer to bet on Penn National will take de on Windows 2000,” Miele said. than $700,000 — can be parti- German airline Deutsche Lufthansa Blue Bell, Pa based Unisys livery of the Unisys ES7000 in Penn National is an early ex- tioned into six smaller servers, AG signed a contract to more than Corp.’s new 32-processor Intel June and then migrate applica ample of a company trying to allowing users to consolidate double its investment in SAP AG's Corp. server. The server will tions in two stages. Many of curb server proliferation by multiple applications within business applications during the run Windows 2000 Data Cen the core applications sched taking advantage of scalable, one box. DB next three years. Financial details ter Edition, the companies said weren't disciosed, but the compa- last week nies said the number of Lufthansa During the next 24 months, Healtheon Allies with CVS managers and other health care workers who use SAP's software is the insurer will use the main- institutions. expected to increase from about frame-like ES7000 Intel server Healtheon/WebMD pro 8,000 to more than 15,000. to consolidate applications vides Internet-based informa- currently running on more BY JULEKHA DASH cial terms weren't disclosed tion and transactions, health Short Takes than 60 servers, said Tom Internet health care company Woonsocket, R.I.-based CVS content and connectivity to al- Miele, director of infrastruc- Healtheon/WebMD Corp. last will upgrade telecommunica- most 700 insurers. ture at Penn National in Har week forged a five-year infor- tions lines between itself and Healtheon, which relies on CONSUMERS spent $7 billion online risburg, Pa mation technology and busi Atlanta-based Healtheon. Common Object Request Bro- during this holiday shopping season, Penn National's current col- ness partnership with the na- Healtheon will put up two ker Architecture middleware, and 90% of 810 consumers sur- lection of servers includes tion’s largest retail drugstore frame-relay lines between the currently handles 23 million veyed reported high satisfaction Hewlett-Packard Co. Unix- chaCiVSn Co,rp . firms to handle the 36% in- transactions per month. Tim with their online experience, based servers, Compaq Com- Healtheon will complete crease in monthly pharmacy Hohl, a spokesman for Seattle- according to a study by New York- puter Corp. Windows NT- more than 50 million electronic switching transactions that will based CVS.com, said one of the based JUPITER COMMUNICATIONS based servers and IBM main- pharmacy transactions for CVS result from the deal, said Con- company’s goals from the part- INC. .. . ORACLE CORP. is support- frames over the next six months, and nie Roebuck, a pharmacist at nership will be to eventually ing XML in its latest releases of The consolidation project is CVS.com will be the exclusive Healtheon. These transactions conduct the entire prescrip- Discoverer and Reports, 3i and 61, part of an effort by Penn Na- online pharmacy for Healtheon connect CVS pharmacies to in- tion approval and payment respectively. tional to enhance its electronic and its online partners. Finan- surers, pharmacy benefits process electronically. D All-Stars (Why we've one of the “100 Best Companies to Work For” as reported in FORTUNE’ magazine.) The quality of our people is the reason for our success. That’s ‘tar emphasizes teamwork, communication and trust. A survey easy enough for any company to say. But at Capital One, in FORTUNE magazine considered these factors when it >; we back up our words by helping people develop their >. named us one of the “100 Best Companies to Work For,” , ‘ > talents. We deliver training, tuition reimbursement, family : Ti two years in a row! To find out more about the place where L‘ ye }> WOU: care days, and stock purchase. All in an environment that 1} TO WORK FOR B you can really shine, go to www.capitalone.com CapitalQc NEWS COMPUTERWORLD January 17, 2000 Civil Liberties Groups Slam Encryption Export Rules and sell encryption products,” Sobel said. “While that is a positive develop- | ment, the government will still retain significant control over this technol- BY ANN HARRISON | ulations released by the U.S. Depart- | guaranteeing the free exchange of in- ogy, to the detriment of efforts to create Three civil liberties groups last week ment of Commerce, charging that they | formation and fall short of the C | atruly secure Internet blasted the new encryption export reg- still violate constitutional protections | ton administration’s promise to deregu- Officials at Network Associates Inc. late technology that secures electronic are applauding the relaxation of restric- communications. tions. “I can see why the privacy rights The American Civil Liberties Union groups have an issue, but from a busi- in New York, the Electronic Frontier ness standpoint, the one-time technical Foundation (EFF) in San Francisco and | review has already been in effect for the Washington-based Electronic Pri- 56-bit products and has not proved to | vacy Information Center (EPIC) said be a burden,” said Kelly Blough, direc- they will continue to push for the elimi- tor of government relations at the Santa | nation of U.S. government regulations Clara, Calif.-based firm, which exports on Internet encryption technology. encryption software. The new rules, which took effect Jan. 14, allow the export of strong retail en- | Not Satisfied cryption products by lifting restrictions | Shari Steele, director of legal services | on encryption ke length. Although at EFF, said the government has pursued past requirements for export licenses a divide-and-conquer strategy, giving have been removed, such products will preferential export considerations to still require a one-time review by the commercial entities in an effort to Commerce Department, and the ban on push their agendas. The constitutional sales of encryption products to seven watchdogs further noted that while the | nations accused of sponsoring terror- | new regulations appear to permit free ism is still in place. posting of encryption source code to EPIC general counsel David Sobel Internet discussion lists, these postings said U.S. government review inhibits may be illegal if the author has “reason the fre xchange of encryption tech- to know” that they will be read by a per- nology. “The revised rules will make it son in one of the countries that are easier for commercial firms to export | banned from receiving such material. D Oracle Beefs Up Database Security BY ROBIN ROBINSON “I think application service providers Oracle Corp. last week unveiled two will be excited,” said Terilyn Palanca, | security features for its 8i Release 2 an analyst at Cambridge, Mass.-based | data e aimed at businesses that con- Giga Information Group Inc. “They duct e-commerce. don’t want to put up a version of the A new data encryption feature was Oracle datab for each client using designed to protect information across | them. With [this] virtual private data- | the enterprise, from desktops to the | base, they can mix the data and not central database. d the virtual pri- | require [database administrators] to vate database feature that debuted in 8i manage all this, like V iS. vaee-a can now manage very large databases much better way to provide security.” with tens of thousands of simultaneous Likewise, corporate database devel- users, the software company said. opers want data encryption across a Chip Self, a regional programmer at company’s infrastructure, not just with- First American Title Co., uses the ver- in the network. “People know the Se- sion of the virtual private database cur- cure Sockets Layer encryption is in the rently available in Release 8.15 of 8i and wire, but they want it to go all the way plans on upgrading to 8.16 as soon as it’s to the actual storage of the data,” Palan- available for the Windows NT platform | ca said. “Oracle’s done a lot of work in next month, he said this area that I’m not sure the others Self, based in nter Park, Fla., said have done.” he uses the security feature to allow 20 Bob Shimp, senior director of prod- account-reporting locations to see one uct marketing for Oracle’s Internet another's data but only alter their own platform, said Release 2 is available information. now on a number of popular Unix ver- sions and will be available on the Win- Harder to Hack dows NT platform next month. “In the past, you had to do that with “A couple days ago, a guy in Eastern {[command-option] VIEWS, but this is Europe broke into an e-commerce site extremely flexible,” Self said. “And you and stole 300,000 credit-card numbers. can’t hack around it. It goes all the way With Oracle’s data encryption, even if down to the basic levels of the Oracle he got past all the other safeguards, | database. The only way that you can all he would see is garbled informa- override it is with SYSUSER [adminis- tion,” Shimp said. “It’s very difficult to trative authority ].” decrypt this.” D

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(IDG CALCULATED RISKS GATES NEW ROLE PROTECTING CUSTOMERS COMPUTERWORLD Find out how IT innovators place successful bets Microsoft chairman appoints Steve Ballmer CEO Ralph Nader warns that digital signature legislation in Congress on bleeding-edge technology. Page 52 and takes on software architect mantle. Page 6 might leave consumers at risk. Page 32 THE NEWSPAPER FOR IT LEADERS =» WWW.COMPUTERWORLD.COM Il SPENDING LETS AOL DEAL ABETS at $350 billion, see themselves positioned to offer broadband RICHER CONTENT access and to speed develop- LOOSE, POST-Y2K | ment of the Internet and inter- active content, according to a Buyout expected to joint statement. And that could | spark changes in the way com- boost broadband access | | spiatneis esa imdeeds igatn coannsdu meburisl.d Web || Scarcity of Y2K problems leads many sgeevaerrsa l or dceopmaprta niaelst ogethsewri tchin BY LINDA ROSENCRANCE “When it comes to designing companies to end systems lockdowns post-Y2K job shuffles. Last week’s. stunning an- Web site content, the increas- | And all around, the mantra nouncement that America On- ing use of broadband devices | seems to be speed, speed, line Inc. will acquire Time | to access the Internet [means BY THOMAS HOFFMAN self-imposed Y2K systems speed. Warner Inc. may companies] will have | AND JULIA KING lockdowns and are moving full- Retail giant Sears, Roebuck change the way com- to produce more rich | Call it the January thaw of the steam ahead with information and Co., for example, is already panies develop their media like we see on | Y2K freeze. | technology projects that had in the thick of jeveloping a Web pages, by speed- television,” said Dan | Big companies such as Sears been put on the back burner. new freight tracking system, ing up the develop- MacKeigan, a senior and Allstate, which have expe- | Still others are busy posting which, like all IT projects to be ment of high-speed Internet Internet analyst at Arlington, rienced few if any Y2K-related | press releases and nailing up launched by the retailer this access and possibly rekindling Va.-based Friedman, Billings, | glitches, have started to end | new door plaques as CIOs at IT Spending, page 93 “browser wars,” Web develop- Ramsey & Co. ers and analysts said. Tom Lix, president and CEO If the all-stock deal is suc- | of NewMarket Network, a| cessful, the companies, valued | AOL Deal, page 16 WEB SITE UPGRADES: BUILD OR BUY? replace the Microsoft Corp. Growth puts e-suites Site Server-based system that te astonishing under new scrutiny | gave the New York-based re- that these rail- tailer a quick and relatively in- expensive entry to the Web. roads can lose BY CAROL SLIWA Both plans illustrate the dif- Britannica.com Inc. is consid-| ficult choices companies con- 100-unit coal ering scrapping its Open Mar- | front as they expand or create trains for days ket Inc. catalog software be- | online business sites. Either cause it thinks the they can build and Alarm ets Cen off-the-shelf package maintain their sites, isn’t flexible enough tailoring them di- DIANE DUFF, EXECUTIVE to handle the content rectly to their needs DIRECTOR, ALLIANCE FOR customization the as long as they have Ue ath ee) company now wants the resources to do | DERAILED to do. it, or they can launch | VitaminShoppe.- a site rapidly using com is already work- an off-the-shelf e- ing with a consul- commerce suite and | tant, weighing a hope it won’t require Unix-based, _— data- MICHAEL KRUPIT: too much customiza- base-driven Web site Proprietary tools tion or limit their op- | that most likely will have helped CDNow Build or Buy, page 16 | HE JUNE MERGER OF NORFOLK SOUTHERN and Conrail has been a spiral of mishaps — misrouted trains, congested tracks, lost cargo and lost customers. It all started with a botched effort to Lelsldastecceld[acsctlelberstlestecliballlial SBXBBIFT# SEEECAR-RT SORTHIB-O52 integrate computer systems at the two railroads, reports Kim S #48106UIZ984P20058 OCT 88 981 9888 Nash. Some of the technology glitches have been fixed, but UMT 164 |e ven seven months after the merger, crews are still misscheduled, and cus- UMNT NEWSPAPER | tomers are still temporarily losing their products somewhere on 21,600 PO BOX 984 ANN ARBOR MI 48106-0984 || miles of track. Story begins on page 20. For Non-Stop Availability, Just ARGServe/T. It's not a question of if you’re going to crash... but when? Hardware failure, service interruptions natural disasters, malicious acts...all can bring your business to a halt. When you ARCserve"/T,” you can rest easier knowing that an integrated high-availability solution is helping to ensure continuous access to data, even if your server suffers catastrophic dam- age. How? By replicating data in realtime to a secondary system, which can be located virtu- ally anywhere, and transparently switching users when a problem is detected. ARCserve/7, Complete Storage Management,’ delivers advanced functionality, easy administration, and unsurpassed reliability to any environment —from a single server to a global enterprise. ARCserve/T’s extensive Suite of solutions offer extensive client/server support, automated disaster recovery, “hot” application protection, enhanced performance, policy-based data management, and support for the latest IT technologies like Storage Area Networks. For more information on our high-avail / solutions, call 1-877-2 GO FOR IT OMPUTER® i SSOCIATES Software superior by design. 3 TIN 2010 What will the corporate !T organization look like in a decade? No one knows for sure, but experts agree it will look different, and they're leaning toward the theory that it will focus more on the customer and on out- . — Side trading partners. Page 50 } : i: a A new activist group is | targeting child pornography 4 3 La on the Internet and feels justified in killing offending servers if it has to, says spokesman Kent Browne. Page 40 JANUARY 17, 2000 NEWS Q BUSINESS 4 TECHNOLOGY 4 MILLIPORE FINDS that 40 CONDEMNED.ORG fights 64 A CREDIT BUREAU uses Oracle’s vision of a global ERP child pornography on the thin-client applications to system requires a huge amount Internet. ease customer access to its RATES ARE of work. 42 SIEMENS ELIMINATES database. GOING TO GO STEVE BALLMER replaces duplicate accounting services CATHAY PACIFIC invests in Bill Gates as Microsoft CEO in an effort to cut costs. an intranet to provide main- UP A LOT AND, amid rumors ofa Microsoft 90 frame access to employees breakup. WHAT WILL corporate IT worldwide. look like in 2010? Radically LARGELY, [IT LOTUSPHERE 2000 high- EDS TEAMS with Ariba to different from the way it looks offer Web procurement sites today, say analysts. lights Web application tools SHOPS] ARE for big corporate customers. this week. FLEET DESCRIBES what it CIVIL LIBERTIES groups was like for employees during HANDS ON GOING TO WE REVIEW two multi- blast the new encryption regu- the Y2K rollover and discusses lations released by the U.S. its plans for the future. function printers, ergonomic GET mice and keyboards. Department of Commerce. INTEL UNVEILS speedstep tIhTe IbNenNefOiVtsA TofO RneSw mteacxhinmoilzoeg y QTCUPI/CIKPS TURDUYL ES modern SCREWED. technology for laptops, which while minimizing the risks networking, shaping key IT approaches desktop speeds. Y2K ACRONYM makes a management practices. ANALYST, META GROUP INC., NOVELL WANTS TO BE an mess of rules for abbreviation, A GARTNER ANALYST SAYING THE SHORTAGE OF WEB abuptp liitc awtoino’nt sperrovviicdee pdreotvaiidlesr , LarAguWeYs EJRarSg on ADJuVdIgeS.E extreme asdhvoiusleds aodno pwt heMni croors owfhte’st heArc IT COARNNEDSS UOLLUTORAWCNEETRSS QAUWRIAELL LI STYTI RNECATRSC EHAAESVDEA ILPTARHBIILNCE E S until later this year. caution when developing a tive Directory. SEE PAGE 91 TEEN-AGERS STEAL user product of your own invention COMPANIES LOSE cus- accounts from Internet service QUICKSTUDY tomers when they fail to providers and attack govern- 58 IT ADOPTS risk-management respond to e-mail queries. ment sites. practices to secure data online. One company has a solution. RAILROADS CONTINUE to i wee Ba, wd lose money seven months after MANUFACTURERS could CONSUMER ADVOCATE merger because of botched IT * integration. be moving to simpler, faster Ralph Nader says Congress 28 THE AOL/TIME WARNER software, which will mark the must protect consumers in any IT INDUSTRY would benefit merger could make life diffi- next stage of IT innovation, digital-signature legislation. from a Microsoft split, says cult for corporate IT, Mark says Allan Alter. COMPANIES should buy International Data Corp. Hall writes in this week’s U.S. COMPANIES wii rather than build dot-coms to MORE editorial. be saving $30 billion this year keep up in today’s Internet Editorial Letters. ... 28,29 A NEW DECADE means a by not having to deal with economy, says Kevin Fogarty. How to Contact CW ......92 different approach to leader- Y2K. John Gantz says IT PETER G. W. KEEN ques- SE BN ee ene ens ..94 ship for IT managers, writes should use that “windfall” tions IT’s readiness to take on Stock Ticker Wharton School professor while it basks in stronger the inherent business chal- Company Index Michael Useem. credibility. lenges of e-commerce. www.computerworld.com NEWS ~ COMPUTERWORLD January 17,2 000 Move to Single Global ea BP Amoco in $200M ERP System No Easy ‘Task Outsourcing Pact British oil company BP Amoco PLC last week expanded its finance, mised the new ERP release For example, users with a accounting and information tech- Implementing Oracle’s centralized vision would be ready last fall but single global system “can’t take nology outsourcing contract with requires tremendous work, says user then ran into delays. a sort of backwater operation New York-based Pricewaterhouse- Oracle last week said an 18- and install new technology Coopers in a 10-year, $200 million month project to put all of its there to see if it works,” he deal that includes the company's BY CRAIG STEDMAN was completed last month. internal operations on one Re- added. “It’s all or nothing.” Canadian operations. Dan Kane, a SERS WHO plan Still to come, Dapcic said, is lease lli-based global system That’s one of the reasons spokesman for BP Amoco, said he to follow Oracle a database upgrade, a switch remains on track for comple- Millipore plans to move ahead expects the outsourcing arrange- Corp.’s new road from Oracle’s green-screen ap- tion by the end of this year. cautiously, Dapcic said. Anoth- ment to reduce the company’s total map for central- plications to its Web-based But Lance Travis, an analyst er big concern is how much its costs by as much as 30%. izing their global software and heavy amounts of at AMR Research Inc. in systems will be strained by enterprise resource planning testing to gauge how well the Boston, said he’s skeptical that switching to Oracle’s graphical Auto Web DPEeDOa lSsE S AAT (ERP) systems on a single centralized system will be able many users will follow Oracle’s user interface, which is re- database server may have a lot to handle end-user workloads. lead. “In theory, it sounds like a quired with Release Ili. of prep work to do first Millipore has also assigned great idea,” Travis said. “But Millipore beefed up its net- Automakers Ford Motor Co. in Dear- Just ask Millipore Corp. more than a half-dozen em there’s a lot of risk.” works by installing new 3Com born, Mich., and General Motors The maker of water-filtra ployees to spend 12 weeks Corp. switches and doubling or Corp. in Detroit launched major Web tion devices is one of the first helping Oracle's developers even tripling much of its wide- alliances last week. Ford announced users to sign on to install a sin debug a new order manage Millipore area bandwidth. But the Web- it will work with Santa Clara, Calif.- gle global ERP system that’s ment module that’s part of the based graphical interface “may based Yahoo Inc. on personalized supposed to be made possible application upgrade needed to Fuses Systems change the picture again,” said Web services and voice-activated by an Oracle application up run a single global system. Ram Prabhu, Millipore’s cor- Web access in its vehicles. GM inked grade in the next few months “We're hoping we can get a The promise porate telecommunications deals with Internet access providers Che $700 million manufac much cleaner product than we manager. “We don't have a America Online Inc. and NetZero turer shifted its European op usually do when it comes off good understanding of [its] Inc. in Westlake Village, Calif., to erations from their own ERP the production line [at Ora bandwidth requirements.” offer targeted Web marketing. server to one at company head- cle],” Dapcic said To try to get a better idea, quarters in Bedford, Mass., two Millipore is taking yet another NasGodesO averqse as months ago, leaving only its Inherent Risk lenge: Milli step: giving about one-third of Japanese unit on a separate Millipore’s goal is to test the ogy changes t the 300 heavy-duty ERP users system. Millipore executives unified system in the summer n 2OOdrr ascylset em. Ihe compa in its manufacturing opera- Nasdaq Stock Market Inc. in New last week said putting every and go live with it by October, tions a Windows-based ver- York has formed a joint venture with thing on the U.S. server should he said. The company wouldn't sion of Oracle’s software to a software developer in India to cre- reduce data center costs and disclose how much the whole start performance testing be- ate Internet-based trading systems give end users a unified view project is expected to cost. fore Release lli is available. D aimed at supporting Nasdaq-Japan of the company’s business. The order management soft MOREONLINE and Nasdaq-Europe when those But getting there won't be a ware is due in May, and the rest electronic markets go live next year. simple task of Oracle's Release lli upgrade For more coverage of Oracle and enterprise TMhaer kejtoisn,t cwiolml pbaen ys,u ppcaolrlteedd Inbdyi gSoS-I Proceeding With Caution mii so ntshu. ppoOsraecdl e toor igisnhaillpy nperxot wrewswo.ucrocem puptlaenrnwinogr,l dv.icsiot mo/umro rWee b site Technologies Inc. in Chennai, India. Millipore has already done heavy lifting on both the busi- Short Takes ness and technology sides, and Travel Site Faces Integration Challenges there’s plenty more that needs to be done before the unified James R. Kinney, longtime CIO at system can become a reality KRAFT FOODS INC. in Northfield, late this year. Inc. It will offer prices equal to travel sites like Travelocity.com The 27 airlines lll., has announced plans to retire The project team plans to or lower than those available and Expedia.com because the in March. Steve Finnerty, Kraft's tread carefully to try to make use myriad systems from other travel sources, offi- new site will offer consumers vice president and chief technology sure “that we're not selling cials said. the Internet-only fares that un- officer since 1998, will succeed something we can’t deliver,” But good news for cus- til now have been available only Kinney. . . . New York-based said Michael Dapcic, manufac BY STACY COLLETT tomers is not-so-good news for from individual airline sites. BARNESANDNOBLE.COM LLC CEO turing business systems man The travel megasite under de- the Web site’s information “This [technology] will be Jonathan Bulkeley resigned last ager at Millipore. “We have a velopment by four U.S. airlines technology staff, which is now unique in offering [Internet- week to pursue interests in other very sensitive user base, and got a huge boest last week after challenged with linking the only} inventories,” said Ben internet companies. . . . SAP AG they're very unforgiving when 23 U.S. and foreign carriers myriad global distribution sys- Burnett, a Chicago-based vice said John Milana resigned as chief it comes to response times.” signed on as associate mem- tems used for ticketing. Each | president at The Boston Con- financial officer at its U.S. subsid- Steps the company has al- bers. But the added support will system contains different data sulting Group, which is devel- iary. . . . Struggling Netherlands- ready taken include a six leave IT with a big headache. formats, database formats and oping the site. based BAAN CO. lost its second top month effort to create a com- Nicknamed T2, the Web site a hodgepodge of custom appli- Developers plan to launch executive in two weeks with the mon accounting structure for is a joint project of UAL Corp.'s cations developed for each the site by midyear, which in- resignation of Chief Financial Offi- Millipore’s business units and United Air Lines Inc., Delta Air user, observers said. dustry watchers said is a rea- cer James Mooney. . . . NOVELL an overhaul of the company’s Lines Inc., Northwest Airlines These technology issues are sonable goal — with some INC. shipped NetWare 5.1 last week. network infrastructure that Inc. and Continental Airlines different from those faced at patchwork. D APPLICATIONS ON DEMAND How do we manage our growth? hired Corio. Vertical Networks, Inc. knew they would need top tier business applications to manage their incredible growth. Corio offers leading applications such as Siebel, PeopleSoft, Commerce One, BroadVision, and Cognos—all fully integrated. Simply access any of these applications over a secure network for a monthly fee. No big investments. No integration costs. No IT worries. Now Vertical Networks, Inc. can focus on their business—and let Corio do the rest. Get this IDC written white paper FREE! Call CORIO at 877.267.4627 er company and product names f t@spective owners. or visit www.corio.com NEWS ~ COMPUTERJaWnuaOryR 1L7,2D 0 00 Ballmer Becomes CEO of Microsoft Gates to lead software development; move aInn c. anianl ysSta n at JoGsea,r tnceirt ing( srSouunp tpioosnes . [Mhiecrreo]s afits’ s to “wfhroeleeze putrh-e aignegr Iantc .L oaidn KJaicnkgs onMvainlulfea, ctuFlra-., could help Redmond in antitrust talks Microsystems Inc.’s upcoming developers, to keep the devel- said he doesn’t believe Gates’ StarPortal, as well as Desk- opers looking at Microsoft and new role will make much of a top.com Inc. and Halfbrain.com not at the other technologies difference. “I don’t think really BY KIM S. NASH ing Microsoft’s product teams Inc., two start-ups that provide out there,” he said. any of their business practices PATRICK THIBODEAU in a new oftware initiative, virtual “Webtops” with applica Dave Snider, a network man- will change,” he said. D AND DOMINIQUE DECKMYN dubbed Next Generation Win ILL GATES stepped dows Services. The plan won't Redmond Loses a Round in Permatemp Suit down as Microsoft be fully disclosed until April, Corp.s CEO last and products are slated to ship week to take ¢ harge gradually during the next three of a new “end-to years BY CRAIG STEDMAN Numbers Game end” software plan designed to The blueprint calls for creat AND CHRISTINE McGEEVER infuse all Microsoft products ing software that meshes a per Employers of high-tech con with Internet capabilities son's online life with his desk tract workers are being urged to Rulings on how many temps might bee ligible for Microsoft benefits: Microsoft President Steve top applications. For example, re-examine their benefits poli # A US. District Court judge in Seattle ruled that only about 300 Ballmer succeeds Gates as a Web server-based applica cies after Microsoft Corp. lost temps employed at Microsoft between 1987 and 1990 could CEO; Gates will remain chair tion could track an executive's another legal round over its claim the right to buy stock at discounted prices. man of the company airline flights and automati- treatment of so-called perma ® The 9th U.S. Circuit Court of Appeals in San Francisco over- The announcement came at cally notify his family by pager temps turned that decision last spring, opening the case to include up the end of a week of rumors that he would be late getting The U.S. Supreme Court last to 10,000 people who did work for Microsoft from 1987 on. and published reports alleging home, Ballmer explained. week rejected Microsoft’s ap that the U.S Department of Microsoft also plans to offer peal of a lower court’s ruling had worked at least five months years ago, the court denied an Justice proposed breaking up its entire product line both as that as many as 10,000 tempo in any 12-month period. Micro- appeal on the issue of whether the company during antitrust shrink-wrapped packages and rary workers should have been soft argued that the eligible temporary workers at the com- settlement talks (see related by subscription over the In allowed to buy the company’s group should be much smaller pany qualified for any benefits. story, page 24). The Justice ternet, Gates said (see story, stock under an employee dis It was the second time the The Microsoft case is being Department declined to com page 14) count plan The ruling stated high court rejected a Microsoft closely watched by technology ment on possible remedies Rival companies are ahead of that Microsoft had to open that appeal in the class action suit, industry groups and legal ob- Both executives insisted that Microsoft, said Chris LeTocq, stock plan to permatemps who which was filed in 1992. Two servers because it could force the changes have nothing to do companies to offer some bene- with those talks. But some ob Microsoft Settles Caldera Suit for About $155M fits to temporary and contract servers said the new software workers who are hired for plan sends a signal that Micro long-term assignments. soft is more adamant than The Supreme Court’s deci- ever about blurring the lines certainty in any legal case. We sion should push other compa- Move unlikely to impact antitrust talks between its operating systems, would have been comfortable nies - and not just high-tech applications and the Internet moving ahead, but we always vendors “to make sure One of Ballmer’s first acts as BY KIM S. NASH ities between Windows and look for a way to come to a fair they’re not exposing them- CEO was to accuse the federal Microsoft Corp. last week paid DR-DOS, which Caldera now settlement,” he said. selves to the same kind of law- government of being sneaky. at least $155 million to settle owns. Microsoft, which con The deal is unlikely to affect suits,” said Ken Dort, a partner “T believe the leaks are delib 1 private antitrust lawsuit sistently denied the charges settlement talks in the federal at technology law firm Gordon erate. I don’t think there’s any brought by Caldera Inc. had tried unsuccessfully to get government's antitrust case & Glickson LLC in Chicago. doubt about that,” Ballmer The settlement isn’t expect- most of the case dismissed. against Microsoft, said Mark The Information Technolo- said in a press conference. “It ed to influence separate anti- The settlement, Schechter, a lawyer at gy Association of America would be absolutely reckless trust settlement talks now signed three weeks Howrey & Simon in (ITAA) in Arlington, Va., and irresponsibie for anyone to under way between Microsoft before a trial was set Washington which filed a friend-of-the- try to break up this company. It and the U.S. Department of to start, leaves sever- That’s because the court brief supporting Micro- would be unprecedented and Justice (see story left). al questions unan- US. Department of soft, blasted the Supreme the single greatest disservice The settlement value wasn’t swered. Chief among Justice is looking for a Court’s decision. “This is a that anybody could do to con- revealed, but Microsoft said it them: Did Microsoft resolution that would 19th-century court making out- sumers in this country.” will cut into quarterly earnings strong-arm PC mak- “limit Microsoft's abil- dated decisions about a 2lst- But if Gates’ decision to by 3 cents per share. That puts ers into favoring its ity to engage in con- century workforce,” said Har- change management roles the value of the deal at at least versoifo DOnS? duct designed to main- ris Miller, ITAA president. means he’ll have less involve- $155 million. “I have mixed BRYAN SPARKS: tain its monopoly The suit must go back to U.S. “Mixed emotions” ment with the lawsuit, it could emotions,” said Bry- position,” said Schech- District Court in Seattle for fi- improve the settlement odds, DOS Duel an Sparks, CEO of on quick settlement ter. The Caldera settle- nal decisions on issues such as according to Harvey Safer- Orem, Utah-based Caldera, a Lineo Inc., a Caldera spin-off. ment, which was strictly mone- how much discounted stock stein, an antitrust lawyer at Linux and embedded systems “We came up with a number tary, “doesn’t do that,” he said. workers should be able to buy. Fried, Frank, Harris, Shriver & developer, sued Microsoft in that if [Microsoft] met, we If damaging evidence had A Microsoft spokesman said Jacobson in Los Angeles. July 1996 for allegedly using its would settle. And in a single surfaced during the Caldera the vendor is “disappointed the monopoly power in operating day, they [did].” trial, it could have given more [Supreme Court] has decided New Job for Gates systems to unfairly squelch Microsoft wouldn't have set- ammunition to consumers sep- now is not the time to review Meanwhile, Gates created a competition in the DOS mar- tled had it not feared evidence arately suing Microsoft in a the issues raised in the latest new position for himself: chief ket. The suit accused Micro- Caldera planned to present, a pile of class action lawsuits. At appeals court opinion.” software architect. He plans to soft of illegally tying its MS- Caldera spokesman claimed. least 76 such suits — including But he said Microsoft doesn’t spend 100% of his time on DOS to Windows 3.1 and inten- Not so, responded a Micro- two last week — have been expect the decision to have a technology development, lead- tionally creating incompatibil- soft spokesman. “There’s un- filed since November. D | big impact on the case. D rT Limai s\Kla VG Sfni i Phe Naa ad Lol it’s e-business or out of business. 65 of the Fortune 100 run Oracle for e-business. ORACLE" SOFTWARE POWERS THE INTERNET ™ www.oracle.com EDS, Ariba To Offer Web-Based Procurement Sites Buying Benefits Win 2K Virus Detected Offers an IT staff that’s Symantec Corp.'s Antivirus Re- dedicated to maintain- search Center said it has found a negotiators, and they know ing purchasing systems Effort aims to lower costs with efficiencies virus that targets Windows 2000, how to strike a good deal [with Streamlines purchasing Microsoft Corp.'s unreleased oper- suppliers].” costs by standardizing ating system. BY LEE COPELAND ba’s procurement network EDS, Bethlehem Steel Corp., on one electronic form Known as Win2000. Install or LECTRONIC DATA since last February. Spray said The Clorox Co., Kellogg Co. W2K. installer, the virus inflicts no Systems Corp. sub the system made transaction and eight other firms have Lowers the price of damage. Cupertino, Calif.-based sidiary CoNext and processing more efficient by signed on to participate in the goods via volume Symantec said it updated its Ariba Inc., plan to using electronic forms and of first of 12 planned sourcing net- antivirus software last week to co-develop Web- fering one spot for users to or works, with the first site launch Eliminates the need to recognize and eliminate the virus. based business-to-business der goods. slated for June. The next four strike individual deals procurement sites for big cor- ‘he other efficiencies are networks — one each for com with suppliers Schwab BuysB ank porate customers, the firms important, but the real upside panies in Asia, Europe and said last week. is the environment of competi- South America and a fourth tium. Participating buyers will CoNext and Ariba want to tion we're building with our for industry-specific procure- install Ariba’s software and Charles Schwab Corp.'s $2.7 billion create what they call Lever- supplies, and we expect that to ments — are expected to open electronic purchasing forms purchase of New York-based U.S. aged Sourcing Networks for translate into lower prices,’ for orders later this year. on their intranets and pur- Trust Corp. will give Schwab access more than 400 companies. The Spray said Ariba and EDS will charge chase supplies via a Web to very wealthy clients and give U.S. networks will offer a wide Deal Makers registration and per-transac- browser. The deal calls for EDS Trust access to more advanced range of goods and services tion fees to firms that buy in Plano, Texas, and Ariba in technology, analysts said last week. from office supplies and com EDS has demonstrated that goods through the network. Mountain View, Calif., to swap “This is a swap - products and ser- puter systems to travel and en it can lower costs by driving ef. Company officials declined to stock warrants. EDS could gain vices for advanced technology,” ergy services — for purchase ficiencies into many business provide specifics. a stake in Ariba of up to 7.3% said Amy Butte, an analyst at New and auction processes and managing sys Ariba operates an extensive depending on the revenue York-based Bear, Stearns & Co. Greg Spray, the director of tems effectively, said Stan Lep online catalog of office sup- stream generated from the pro- operations procurement at eak, a vice president at Meta plies that will be tailored to curement sites, while Ariba Intel's in the Black Hewlett-Packard Co. in Palo Group Inc. in Stamford, Conn. meet the specific purchasing could gain a 5% stake in Alto, Calif., has been using Ari- “Theit consultants are better needs of each buying consor- CoNext. dD Intel Corp. reported fourth-quarter revenue of $8.2 billion, up 8% from Insurer Bets on Intel Server uled to run under Windows relatively inexpensive Intel the fourth quarter of 1998. For the 2000 on the new server will be servers and the central man- year, the company reported revenue tested on smaller four-way and agement capabilities promised of $29.4 billion, up 12% from 1998. eight-way systems before be- by Windows 2000. Intel said acquisition-related business capabilities ing put on the ES7000 “Server consolidation is go- costs resulted in net income of $7.3 32-processor box to The company will also roll ing to be a big story,” said billion in 1999, up 21% from $6.1 run Windows 2000 out two new applications: a Cautious Approach Joseph Ferlazzon, an analyst at billion in 1998. Web-based claims processing “We are taking a very cau- Technology Business Research application for 1,200 indepen tious approach.... It is going Inc. in Hampton, N.H. Lufthansa Picks SAP BY JAIKUMAR VIJAYAN dent agents and a policy ad to be some time before we put The Unisys ES7000 — Penn National Insurance is the ministration system. any production applications priced from $150,000 to mere first U.S. customer to bet on Penn National will take de on Windows 2000,” Miele said. than $700,000 — can be parti- German airline Deutsche Lufthansa Blue Bell, Pa based Unisys livery of the Unisys ES7000 in Penn National is an early ex- tioned into six smaller servers, AG signed a contract to more than Corp.’s new 32-processor Intel June and then migrate applica ample of a company trying to allowing users to consolidate double its investment in SAP AG's Corp. server. The server will tions in two stages. Many of curb server proliferation by multiple applications within business applications during the run Windows 2000 Data Cen the core applications sched taking advantage of scalable, one box. DB next three years. Financial details ter Edition, the companies said weren't disciosed, but the compa- last week nies said the number of Lufthansa During the next 24 months, Healtheon Allies with CVS managers and other health care workers who use SAP's software is the insurer will use the main- institutions. expected to increase from about frame-like ES7000 Intel server Healtheon/WebMD pro 8,000 to more than 15,000. to consolidate applications vides Internet-based informa- currently running on more BY JULEKHA DASH cial terms weren't disclosed tion and transactions, health Short Takes than 60 servers, said Tom Internet health care company Woonsocket, R.I.-based CVS content and connectivity to al- Miele, director of infrastruc- Healtheon/WebMD Corp. last will upgrade telecommunica- most 700 insurers. ture at Penn National in Har week forged a five-year infor- tions lines between itself and Healtheon, which relies on CONSUMERS spent $7 billion online risburg, Pa mation technology and busi Atlanta-based Healtheon. Common Object Request Bro- during this holiday shopping season, Penn National's current col- ness partnership with the na- Healtheon will put up two ker Architecture middleware, and 90% of 810 consumers sur- lection of servers includes tion’s largest retail drugstore frame-relay lines between the currently handles 23 million veyed reported high satisfaction Hewlett-Packard Co. Unix- chaCiVSn Co,rp . firms to handle the 36% in- transactions per month. Tim with their online experience, based servers, Compaq Com- Healtheon will complete crease in monthly pharmacy Hohl, a spokesman for Seattle- according to a study by New York- puter Corp. Windows NT- more than 50 million electronic switching transactions that will based CVS.com, said one of the based JUPITER COMMUNICATIONS based servers and IBM main- pharmacy transactions for CVS result from the deal, said Con- company’s goals from the part- INC. .. . ORACLE CORP. is support- frames over the next six months, and nie Roebuck, a pharmacist at nership will be to eventually ing XML in its latest releases of The consolidation project is CVS.com will be the exclusive Healtheon. These transactions conduct the entire prescrip- Discoverer and Reports, 3i and 61, part of an effort by Penn Na- online pharmacy for Healtheon connect CVS pharmacies to in- tion approval and payment respectively. tional to enhance its electronic and its online partners. Finan- surers, pharmacy benefits process electronically. D All-Stars (Why we've one of the “100 Best Companies to Work For” as reported in FORTUNE’ magazine.) The quality of our people is the reason for our success. That’s ‘tar emphasizes teamwork, communication and trust. A survey easy enough for any company to say. But at Capital One, in FORTUNE magazine considered these factors when it >; we back up our words by helping people develop their >. named us one of the “100 Best Companies to Work For,” , ‘ > talents. We deliver training, tuition reimbursement, family : Ti two years in a row! To find out more about the place where L‘ ye }> WOU: care days, and stock purchase. All in an environment that 1} TO WORK FOR B you can really shine, go to www.capitalone.com CapitalQc NEWS COMPUTERWORLD January 17, 2000 Civil Liberties Groups Slam Encryption Export Rules and sell encryption products,” Sobel said. “While that is a positive develop- | ment, the government will still retain significant control over this technol- BY ANN HARRISON | ulations released by the U.S. Depart- | guaranteeing the free exchange of in- ogy, to the detriment of efforts to create Three civil liberties groups last week ment of Commerce, charging that they | formation and fall short of the C | atruly secure Internet blasted the new encryption export reg- still violate constitutional protections | ton administration’s promise to deregu- Officials at Network Associates Inc. late technology that secures electronic are applauding the relaxation of restric- communications. tions. “I can see why the privacy rights The American Civil Liberties Union groups have an issue, but from a busi- in New York, the Electronic Frontier ness standpoint, the one-time technical Foundation (EFF) in San Francisco and | review has already been in effect for the Washington-based Electronic Pri- 56-bit products and has not proved to | vacy Information Center (EPIC) said be a burden,” said Kelly Blough, direc- they will continue to push for the elimi- tor of government relations at the Santa | nation of U.S. government regulations Clara, Calif.-based firm, which exports on Internet encryption technology. encryption software. The new rules, which took effect Jan. 14, allow the export of strong retail en- | Not Satisfied cryption products by lifting restrictions | Shari Steele, director of legal services | on encryption ke length. Although at EFF, said the government has pursued past requirements for export licenses a divide-and-conquer strategy, giving have been removed, such products will preferential export considerations to still require a one-time review by the commercial entities in an effort to Commerce Department, and the ban on push their agendas. The constitutional sales of encryption products to seven watchdogs further noted that while the | nations accused of sponsoring terror- | new regulations appear to permit free ism is still in place. posting of encryption source code to EPIC general counsel David Sobel Internet discussion lists, these postings said U.S. government review inhibits may be illegal if the author has “reason the fre xchange of encryption tech- to know” that they will be read by a per- nology. “The revised rules will make it son in one of the countries that are easier for commercial firms to export | banned from receiving such material. D Oracle Beefs Up Database Security BY ROBIN ROBINSON “I think application service providers Oracle Corp. last week unveiled two will be excited,” said Terilyn Palanca, | security features for its 8i Release 2 an analyst at Cambridge, Mass.-based | data e aimed at businesses that con- Giga Information Group Inc. “They duct e-commerce. don’t want to put up a version of the A new data encryption feature was Oracle datab for each client using designed to protect information across | them. With [this] virtual private data- | the enterprise, from desktops to the | base, they can mix the data and not central database. d the virtual pri- | require [database administrators] to vate database feature that debuted in 8i manage all this, like V iS. vaee-a can now manage very large databases much better way to provide security.” with tens of thousands of simultaneous Likewise, corporate database devel- users, the software company said. opers want data encryption across a Chip Self, a regional programmer at company’s infrastructure, not just with- First American Title Co., uses the ver- in the network. “People know the Se- sion of the virtual private database cur- cure Sockets Layer encryption is in the rently available in Release 8.15 of 8i and wire, but they want it to go all the way plans on upgrading to 8.16 as soon as it’s to the actual storage of the data,” Palan- available for the Windows NT platform | ca said. “Oracle’s done a lot of work in next month, he said this area that I’m not sure the others Self, based in nter Park, Fla., said have done.” he uses the security feature to allow 20 Bob Shimp, senior director of prod- account-reporting locations to see one uct marketing for Oracle’s Internet another's data but only alter their own platform, said Release 2 is available information. now on a number of popular Unix ver- sions and will be available on the Win- Harder to Hack dows NT platform next month. “In the past, you had to do that with “A couple days ago, a guy in Eastern {[command-option] VIEWS, but this is Europe broke into an e-commerce site extremely flexible,” Self said. “And you and stole 300,000 credit-card numbers. can’t hack around it. It goes all the way With Oracle’s data encryption, even if down to the basic levels of the Oracle he got past all the other safeguards, | database. The only way that you can all he would see is garbled informa- override it is with SYSUSER [adminis- tion,” Shimp said. “It’s very difficult to trative authority ].” decrypt this.” D

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