Weekend news roundup

18 Oct 2010

A quick glance at some of the technology stories breaking in the weekend papers.

More privacy headaches at HSE

The Sunday Independent reported how hundreds of patient records were seriously compromised by a major security breach at the HSE. The 1,500 sensitive health records were removed from a Dublin office and emailed to an outside organisation.

A private IT contractor, who was being overseen by a HSE staff member, downloaded the records on to an unencrypted USB key – something that is absolutely forbidden in the HSE’s own protocols.

The contractor took the private health records home to work on overnight – again a serious breach of the health authority’s procedures.

Intending to email the records on the memory stick back to the HSE, the contractor mistyped the address and instead accidentally emailed them to another State body.

The security breach was only discovered when the public body involved alerted the HSE.

The internal investigation into it has involved several senior HSE figures and is being considered a “major wake-up call” for the data leak-prone authority.

The patients involved this time have not been informed that their private information has been jeopardised. The Data Protection Commissioner has cited the HSE several times in his reports and is said to be investigating why yet another leak has occurred.

The Google effect

A peek into Google’s YouTube and other new businesses sparked sharp gains for technology groups, the best performing sector on the week, the Financial Times reported.

In addition to reporting expectation-beating earnings, Google said in a one-time announcement that non-text display advertisements, such as those on YouTube and mobile phones, would generate $2.5bn in sales in 2010, which impressed analysts.

JPMorgan Chase said YouTube represented about $1.5bn of those revenues. Credit Suisse said it estimated that YouTube was nearing profitability.

“This colour should help improve sentiment around the sustainability of Google’s long-term growth,” said Spencer Wang, an analyst at Credit Suisse.

Google’s shares rose 11.2pc to $601.45, their highest since January. It was the biggest one-day gain in two years.

Akamai, maker of the video software that powers YouTube, gained 2.2pc to $47.09. Shares of networking equipment maker Cisco added 1.3pc to $23.36.

Google also said paid clicks were up 16pc in the third quarter over the same period in 2009. Search and online ad rival Yahoo gained 2pc to $16.25 and Microsoft added 1.2pc to $25.54. Expectations also rose for Apple, which reports earnings on 18 October. Its shares were up 4.1pct to $314.74, an all-time high.

Tanaiste’s brother’s mobile connections

The Sunday Independent carried a story claiming a company run by a brother of the Tanaiste, Mary Coughlan, is making about €15,000 a year on the sale of mobile telephones to TDs and senators who are then reimbursed by the taxpayer.

Yesterday, Kevin Coughlan of Millennium Communications Cellular told the Sunday Independent that his business – with around 20 Oireachtas members – formed a “very small part” of his €1m annual turnover.

Oireachtas members can receive up to €750 every 18 months towards the cost of purchasing mobile phones, car kits and insurance under a scheme that was instigated in 2002.

Records released last week show that several Fianna Fail TDs and senators purchase telephony from Millennium Communications Cellular, a company incorporated in 1999, which is based in Kilmainham, Dublin.

Millennium Communications has two listed directors, Kevin Coughlan and his wife Josephine of Ballindoolin, Edenderry, Co Offaly. Coughlan is a brother of the Tanaiste and Education Minister, Mary Coughlan.

New online media directory

The Sunday Business Post reported on a new online who’s who for media has been launched, designed to help businesses identify which journalists they need to contact for a possible story.

The Media HQ service is a more sophisticated version of the existing Irish Media Contacts Directory, which is published annually. It’s on offer from Mediacontact.ie, the owner of the offline directory.

‘‘The problem with the printed directory is that it was out of date within days,” said Jack Murray, founder of Mediacontact.ie. ‘‘This is the complete online press office. It offers the most comprehensive listing of all of the media contacts in Ireland in one convenient place.”

Users of the service can send media releases from their e-mail addresses to any of the contacts included on the site.

BT calms investor fears

The Financial Times reported that BT rallied 2.9pc to 147.4p on Friday on relief that the telecoms company had been able to hang on to all its contracts with the UK government.

“There is no change to our overall outlook as a result of this agreement,” BT said.

Paul Howard, JPMorgan analyst, said he believed BT had provided the government with cost savings but these were already reflected in the company’s earnings guidance and had been offset by ongoing efficiencies elsewhere in the business.

However, not everyone was so positive. Deutsche Bank said the agreement might prove to be a temporary respite, citing Sir Philip Green’s report on public spending.

Green claimed savings of 30-40pc could be made on the government’s £2bn telecoms contracts by changing buying practices.

“The longer-term risk remains that BT’s 80pc share of UK government contracts is likely to fall,” said Deutsche Bank. “Ongoing strong progress by management in cutting costs will be increasingly necessary to underpin existing profitability.”

Venture investment falls in the US

Venture capitalists poured less money into US start-ups in the third quarter and split this among more companies, signalling that investors are trying to be more economical with their funds, USA Today reported.

According to a study set to be released Friday, start-up investments declined 7pc to $4.8bn in the July-September period, compared with $5.2bn invested during the same three-month period in 2009. A total of 780 start-ups received funding during the quarter – 9pc more than the 716 companies that took slices of the investment pie last year.

The study, which was conducted by PriceWaterhouseCoopers and the National Venture Capital Association based on data from Thomson Reuters, said that much of the decline stemmed from a drop in large investments in clean technology. Funding in clean-tech start-ups, which include alternative energy, recycling, conservation and power supply companies has been mercurial lately. It fell every quarter last year compared with the previous year, but has been climbing this year – until the third quarter.

Despite the third-quarter funding drop, though, funding for the full year still looks to be higher than it was in 2009. So far this year, venture capitalists have invested $16.7bn in 2,497 start-ups; in all of 2009, $18.3bn was funnelled into 2,916 start-ups.