• Sun Microsystems, which last week agreed to be purchased by Oracle for $7.4bn, reported sharp losses in the opening months of this year, highlighting the impact of the recession on the computer systems company. In a departure from protocol, Sun did not host the usual conference call with investors and analysts following results.
  • IBM responded to the collapse of its own takeover offer for Sun this month with an announcement that it would return more cash to its shareholders instead in the form of a higher dividend and increased stock buy-back plan.

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  • Verizon Communications has held talks with Apple about selling versions of either the iPhone or other Apple devices in the US. Currently AT&T is the exclusive distributor of the iPhone in the US, and the company was reportedly trying to extend that deal for another year. A lucrative deal with Apple would be a coup for Verizon, which reported strong quarterly profits from its growing mobile business.
  • Qualcomm, the world’s biggest maker of chips for mobile phones, put an end to legal wrangling by settling a four-year patent dispute with rival Broadcom. Qualcomm has agreed to pay Broadcom $891m over four years in exchange for the dismissal of all court cases and Broadcom withdrawing its complaints about Qualcomm’s business practices.

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  • The economic slump brought another unwelcome first for the tech industry: Microsoft reported the first year-on-year revenue decline in its 34-year history. The news came a week after Google disclosed its first-ever sequential quarterly revenue decline, itself an important turning point for a company whose stellar growth overshadowed internet rivals for much of this decade. At least Apple has managed to avoid joining this unenviable list: the iPod dodged a widely-expected sales decline, the first in its eight-year history, thanks to strong demand for the touch.
  • Time to bury another relic of the dotcom boom: Yahoo said it was closing GeoCities (though it didn’t explain why putting paid to the struggling web hosting service had required what it described as “careful consideration”.) It paid $3bn for the faded star a decade ago.

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  • MySpace CEO and co-founder Chris DeWolfe is stepping down, News Corp said. The move came as MySpace continues to lose ground to Facebook and prompted a wave of speculation about what the next CEO could – or should – do to put things right (like this blog post from the voluble Jason Calacanis.)
  • Tech’s impressive stock market rally looked like it should stay intact after the latest round of earnings news on Wednesday. Apple and eBay each posted surprisingly resilient numbers. VMWare was the outlier: shares in the maker of virtualisation software slumped in after-market trading as it issued a cautious outlook.

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  • Carol Bartz took a sharper knife than expected to Yahoo’ s staffing levels as the biggest online display advertising company struggled to maintain its profit margins in the face of declining sales. As many as 700 more will join the ranks of the unemployed. However, Ms Bartz said she was not shying away from investing more in Yahoo’s most promising businesses.
  • The music business continues to shrink. The growth in digital sales last year once again failed to make up for declining sales of traditional formats, according to music industry trade group IFPI. Global sales of physical formats dropped by nearly $2.5bn to $13.8bn, while digital purchases rose only $750m to $3.78bn.

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  • For the second time this week, a large technology company claimed that while things might not yet be getting any better, they do at least seem to have stopped getting worse. After Intel‘s claim that the PC market had “bottomed out”, Nokia said it believed the cellphone market was stabilising. Its shares jumped by 11 per cent on the news.
  • Google offered a less encouraging prognosis for a tech recovery. CEO Eric Schmidt said the company was in “uncharted territory” as Google reported the first sequential quarterly fall in revenues in its 11-year history. But with its search business holding up better than other forms of online advertising, Google’s shares held on to the gains of nearly 60 per cent they have notched up since late last year.

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  • Three months into her stint at the head of Yahoo, Carol Bartz is seeking buyers for the HotJobs employment site. Other ancillary businesses in Yahoo’s portfolio could also be getting prepared for disposal.
  • Twitter is benefiting from all that attention. Visitors to Twitter.com surged 131 per cent in March to 9.3m, suggesting that more than being just a fad, Twitter could in fact be going mainstream.

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  • Ebay announced plans to spin off Skype, its internet phone service, after talks to sell Skype back to its founders collapsed. Skype, purchased for $3.1bn in 2005, was meant to help buyers and sellers connect on eBay’s core e-commerce site. But there has been no synergy between the companies, and eBay chief executive John Donahoe has faced increasing pressure to sell Skype. The plan was announced one day after eBay sold StumbleUpon back to its founders.
  • Intel said the PC market has bottomed out, but offered few signs that a recovery from recent drastic sales declines was close at hand. Revenues for the three months through March slumped to $7.1bn, or 26 per cent lower than a year before, while net income fell by 55 per cent to $647m.

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  • Tech Mahindra won the auction for a controlling stake in Satyam Computer Services, the disgraced Indian outsourcing group. Tech Mahindra, which is partly owned by British telecommunications group BT, will pay $353m for a 31 per cent state in Satyam, which is still reeling from an accounting scandal that has made its former chairman the target of criminal investigations.
  • Seagate scrapped its dividend payments and raised $430m in a secured bond issue as it tried to weather the steep downturn in the diskdrive business. The latest evidence of collapsing profit margins wiped nearly 5 per cent off its share price, even as the company gained market share.

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  • US chipmaker Micron ruled out participating in the Taiwanese government’s restructuring plan for the beleaguered D-Ram memory chip industry. The move all but rules out further consolidation in an industry suffering from heavy overcapacity.
  • Search advertising in the US is predicted to fall this year, according to Screen Digest, the first time the industry has faced a serious contraction since it reached maturity. Google, which dominates the search advertising market and holds about 60 per cent market share in the US, has seen its growth slow from 31 per cent in the first quarter of 2008 to 13 percent in the fourth quarter.

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  • Indian police filed formal charges against former Satyam chairman B. Ramalinga Raju, two of his brothers, two Price Waterhouse auditors and four others, in a widening of the probe into the outsourcing giant’s alleged fraud. Meanwhile, four parties emerged as serious bidders for what’s left of Satyam, set to be auctioned off on Monday.
  • The Australian government is set to invest $31bn in the construction of a national broadband network. The eight-year project is expected to create 37,000 jobs, and will amount to the nation’s largest-ever infrastructure project.

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  • IBM took its offer to buy Sun Microsystems off the table when the onetime Silicon Valley powerhouse asked for more money, and said it wanted to talk with other potential buyers when IBM balked. People familiar with the negotiations said everything might still be worked out, since no other suitors are expected and the financial difference between the two sides isn’t vast.
  • The Associated Press is hoping to stanch what it claims is the rampant unauthorised republication of its content across the web. Websites – including Google News – will have to seek permission to use the work of the AP or its member newspapers, and may face legal action if they don’t comply.

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  • According to reports, IBM is set to acquire Sun Microsystems, a prominent rival in the server and software markets, for $7bn. The purchase is the largest in Big Blue’s history, and breaks a long dry spell in the M&A arena. The deal could also cement IBM’s hold on some core hardware and software technologies, bringing a sea change in the world of corporate and government datacentres.
  • Research in Motion reported better than expected fourth quarter earnings thanks to strong BlackBerry sales and a healthy jump in new subscribers, sending its share price soaring in late trading. RIM this week launched a BlackBerry application store to rival the popularity of Apple‘s App Store.

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  • Silicon Graphics finally passed on to the Great Valley in the Sky. The former star workstation maker long ago became the symbol for how old tech companies never die, they just linger. No longer: SGI filed for bankruptcy and sold itself to Rackable Systems for $25m.
  • As we reported at the weekend, and News Corp has now confirmed, former AOL boss Jonathan Miller is the new top digital executive of a domain that includes MySpace and News’ stake in Hulu. Miller’s name had also been in the frame recently as a potential head of Yahoo, as well as Microsoft’s online division.

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  • Google is looking for the next Google. With Google Ventures, a new venture capital arm, the internet search giant hopes to expand its already outsized influence on Silicon Valley and eventually rival established venture firms such as Kleiner Perkins and Sequoia Capital.
  • Facebook is replacing its chief financial officer as it seeks to balance rapid growth against increased capital needs and a closed IPO market. Speculation about Facebook’s financial health has been rampant of late, but today details emerged that suggested the company is in better shape than many thought.

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  • Skype is expanding its push into mobile with the release of its iPhone application. The move is unlikely to threaten major telecom carriers, but may better position Skype for an eventual sale from parent company eBay.
  • Even as TV and print advertising shrunk during the recession, internet advertising remained strong in 2008, topping $23bn. Search remained the dominant form of online advertising, but spending on video, while still a small piece of the pie, more than doubled to $734m.

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