Weekend news roundup

6 Sep 2010

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

Texas investigates Google ranking system

The New York Times reported that the Texas attorney general has opened an antitrust investigation into how Google ranks search results, the first United States case to strike at the heart of the company’s main search business.

The issue at hand — referred to as search neutrality — is whether Google manipulates results to thwart competitors and advance its own businesses. Some companies worry that Google has the power to discriminate against them by lowering their listings in search results or charging higher fees for their paid search ads.

“This whole issue of how Google treats these vertical competitors, that’s a big issue now,” said Gary L Reback, a lawyer at Carr & Ferrell in Palo Alto, California, who has advised small companies that have brought antitrust cases against Google.

Google announced the inquiry by the Texas attorney general, Greg Abbott, on Friday, after Search Engine Land, an industry blog, reported the news. Lauri Saathoff, a spokeswoman for Abbott, confirmed the existence of the investigation but declined to give more information because the review was not complete.

Don Harrison, Google’s deputy general counsel, wrote in a company blog post that Google’s responsibility is to its users, not to websites, and that the company’s priority was to “provide the most useful, relevant search results and ads for users.”

Laptops in Irish schools

The Irish Independent reported how a secondary school taking part in an e-learning pilot programme believes its students will be among the country’s most employable when they finish their education.

Yesterday saw the launch of the new programme for first-year students in St Bricin’s in Belturbet, Co Cavan, with each student given a brand new laptop. Most of their learning during their five years at the secondary school will be done via the computers.

Acting principal Niall McGee said they hoped to give laptops to new students each year from now on – and to have 90pc of learning online within five years.

He believes their new method of learning will boost exam results.

“We’ll have laptop pens instead of pens, and mouse pads instead of writing pads,” he said.

“Our thinking is that technology and learning has moved on, but our methods haven’t.

“Our aim is to bridge that gap and engage (students) with visual and interactive learning.

“They get most of their information from the internet now and we’re very foolish to think that we can engage them with chalk and a blackboard.”

Apple TV puzzle

The Wall Street Journal said it was puzzled as to why Apple CEO Steve Jobs is persisting with the TV device, which lets people rent movies and TV shows via the internet and watch them on their televisions. Jobs has acknowledged that the device hasn’t been a huge hit, owing largely to the difficulties of breaking into the TV set-top box market. Most boxes used by television viewers in the US are made by Cisco Systems or Motorola, which sell directly to cable operators who in turn lease the boxes to customers for a monthly fee. Alternative boxes like Apple TV can’t be used for watching traditional cable service.

Apple may be hoping for regulatory relief – with good reason. In April, the Federal Communications Commission invited comments on a proposal that cable and satellite operators let viewers use any “smart video devices” available in stores to connect to their TV service.

If implemented, it would have far-reaching implications. Among other things, the FCC hopes such a mandate would prompt electronics manufacturers to make devices offering both internet video and traditional TV services. One of the advantages of the existing arrangement, for major TV companies, is that cable-supplied boxes currently can’t be used to watch online video like YouTube or Netflix’s streaming service. For that, consumers need a separate device like Apple TV. Given the hassle of hooking up a separate device, this has undoubtedly limited the appeal of online video as an alternative viewing option.

Admittedly, the FCC has been trying for years to introduce more competition into the set-top-box market, with limited success. But the emergence of online video, bringing with it a plethora of alternative devices, suggests the latest effort may gain traction.

Eircom not blasé about covenants – Donovan

The Sunday Tribune reported that Eircom chief executive Paul Donovan says the company hasn’t been ‘blasé’ in acting to prevent a breach of banking covenants on its €3.1bn debt mountain.

The slide in the company’s earnings before interest, tax and depreciation (EBITDA) declined in the year to the end of June 2009, meaning a breach of its debt-to-EBITDA covenant in the next 18 months is likely unless the debts are renegotiated or Eircom gets a cash boost from its owner, Singapore firm STT.

“I don’t think we’ve ever been blasé about it. I have said the issue of our balance sheet remediation is under active consideration by the board. We are dealing with the issue,” Donovan told the Sunday Tribune after a further downgrade of some of Eircom’s debt by ratings agency Moody’s.

Moody’s forecast that Eircom would breach the covenants next June. It also had concerns that STT was not showing any commitment to solving the problem and questioned Eircom’s strategy. Moody’s was the first ratings agency to raise concern about the company’s debt burden in January.

“We are very confident (a covenant breach) will be avoided and there are very clear options open to us,” Donovan said.