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The Reuters/Variety Cyber Summary
Wednesday, Nov. 27
Edited by Steve Gorman (steve.gorman(at)reuters.com)
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... Top Stories ...
AOL STOCK RISES ON ANALYST UPGRADE, BULLISH VIEW
BABBAGES, SOFTWARE ETC. SALE APPROVED
... Missing Links ...
PRIMECO OFFERS PC-TO-PHONE TEXT MESSAGES
IBM WINS INCENTIVES FOR THAI PLANTS
MICROSOFT LAUNCHES CHINESE SERVER SOFTWARE
SINGAPORE AIMING TO BE 'MOST COMPUTERIZED' NATION
... Net Soup ...
INTEL BUYS MRV SHARES
WORLDCOM ACQUIRES 9.5 PERCENT OF PREMIERE
REED-ELSEVIER AND TIMES MIRROR FORM VENTURE
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AOL STOCK RISES ON ANALYST UPGRADE, BULLISH VIEW
NEW YORK (Reuter) - The stock of America Online Inc. surged Wednesday after an analyst raised his rating on the world's No. 1 online service, saying he has "unwavering enthusiasm for the AOL story."
America Online stock rose $2.75, or more than 8 percent, to $35.375 in afternoon trading on the New York Stock Exchange, on volume topping 3.4 million shares. It was the most actively traded stock on the exchange and one of its biggest percentage gainers.
The stock climbed after Cowen & Co. analyst Jamie Kiggen lifted his rating from neutral to buy.
Kiggen said he believed investors will increasingly recognize the Dulles, Va.-based online service's ability to sustain growth in the number of subscribers, increase non-subscription revenue, achieve a positive cash flow and become profitable over the next few quarters.
With 7 million subscribers, America Online is the largest online service in the world.
BABBAGES, SOFTWARE ETC. SALE APPROVED
DALLAS (Reuter) - NeoStar Retail Group Inc., parent of Babbage's and Software Etc. software stores, said Tuesday a U.S. Bankruptcy Court approved the sale of NeoStar's assets to Software Acquisition Co. LLC.
Software Acquisition is buying all 447 stores and NeoStar's inventory, NeoStar said.
About 200 stores will be closed as a result of the sale, the company said.
NeoStar said Software Acquisition was formed by Leonard Riggio, a NeoStar director who is the principal stockholder of the Barnes & Noble Inc. bookstore chain.
NeoStar filed for Chapter 11 bankruptcy protection from creditors in September and decided to auction the assets in the absence of viable financing alternatives, the company said.
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PRIMECO OFFERS PC-TO-PHONE TEXT MESSAGES
DALLAS (Reuter) - Wireless communications company PrimeCo Wednesday launched a messaging service that allows users with a Microsoft Corp. Windows-based personal computer to send short messages to PrimeCo users' mobile phones.
PrimeCo, owned equally by AirTouch Communications Inc., U S West Media Group, Bell Atlantic Corp. and Nynex Corp., this month began personal communications services in 16 U.S. cities.
When a message is received the handset will beep. It can store the messages, and will do so automatically if the phone is turned off or out of the calling area.
The service costs $14.95 per month for unlimited messaging, and $19.95 for the software which takes 10 minutes to install. The PC used must have a modem.
Each message can be up to 100 characters -- roughly 14 words. The handset can store up to 23 messages, or 700 characters.
IBM WINS INCENTIVES FOR THAI PLANTS
BANGKOK (Reuter) - Thailand's Board of Investment (BoI) said Wednesday it decided to grant tax incentives to International Business Machines Corp. to invest more than $560 million in two hard disk drive plants.
The planned IBM plants, in eastern Thailand, are expected to start production in late 1997, BoI deputy secretary general Chackchai Panichapat told reporters.
He said 80 percent of the plants' output was geared for export, with the remaining 20 percent destined for the Thai market.
BoI chief Staporn Kavitanond said on Tuesday that, if approved, the two IBM wholly-owned plants in Prachinburi and Chonburi provinces would generate sizable export revenues in Thailand and boost the nation's image as a regional center for the electronics industry.
On Wall Street Wednesday, Salomon Brothers analyst John Jones increased his 1997 earnings estimates on the Armonk, N.Y.-based computer giant after IBM's board authorized another share buyback plan that will decrease its shares outstanding.
Jones raised his 1997 earnings estimates to $13.20 a share from $12.80 previously as the average number of shares outstanding at year end 1997 should decrease to 496 million from 528 million at the end of 1996. On Tuesday, IBM's board authorized an additional $3.5 billion share repurchase plan.
Jones also increase his 12-month price target on IBM to $185 per share from $179 currently.
MICROSOFT LAUNCHES CHINESE SERVER SOFTWARE
BEIJING (Reuter) - Microsoft Corp. launched a Chinese version of its messaging system software Exchange Server 4.0 in Beijing on Wednesday, the company said.
Microsoft began shipping the messaging platform in the United States in April. The software provides direct and secure access to the Internet, enabling corporate workgroups to share electronic mail, databases and documents.
The U.S. software giant aimed to develop simultaneous Chinese versions of all its products, Far East corporate vice president Charles Stevens said in a statement.
In September, Microsoft was forced to stop shipping its Chinese language Windows 95 system in China after political slogans and epithets -- possibly inserted by programers from Beijing's arch rival Taiwan -- were found in the software.
Users said the epithets, which included "communist bandits" and "Taiwan independence," were likely to anger Beijing's Communist leadership. Beijing considers Taiwan a rebel province and has vowed to reunify it by force, if necessary.
SINGAPORE AIMING TO BE 'MOST COMPUTERIZED' NATION
SINGAPORE (Reuter) - Singapore plans to become the world's most computerized nation by 2000, the National Computer Board (NCB) said on Wednesday.
"We have set ourselves a new target -- that is not only to be the most computerized nation in the world, but to be the best computerized nation in the world," NCB chairman Lim Swee Say told a news conference after the release of the NCB's annual report.
Lim said he hoped the swift introduction of new technology would make Singapore the "mega IT (information technology) hub" of expertise and innovation in the region.
He said information technology competition in Asia was expected to be keen, but added that this presented Singapore with an opportunity "for collaboration and to contribute to the growth of IT markets and expertise in the Asia-Pacific."
On Tuesday, the NCB launched several local IT initiatives, including an electronic card payment system, an information network for schools and libraries, a virtual shopping mall on the Internet, and an electronic business directory.
Trials of online transactions on the Internet are due to begin next month, while the introduction island-wide electronic identity card trials are scheduled for March 1997.
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INTEL BUYS MRV SHARES
CHATSWORTH, Calif. (Reuter) - MRV Communications Inc. said Intel Corp agreed to acquire 200,000 newly issued MRV shares at $20 a share.
It also said Intel has warrants to buy 500,000 additional MRV shares at the same price, subject to certain conditions.
MRV said the investment is an extension of an existing relationship between the two companies. They have worked together on Local Area Network (LAN) switching products.
WORLDCOM ACQUIRES 9.5 PERCENT OF PREMIERE
WASHINGTON (Reuter) - WorldCom Inc., which recently entered a pact with Premiere Technologies Inc., said it has acquired a 9.5 percent stake in Premiere, or 2,050,000 common shares.
In a filing with the Securities and Exchange Commission, WorldCom said Monday it acquired the stake for investment purposes as part of a Nov. 13 "Strategic Alliance Agreement."
WorldCom said Premiere retains a right of first refusal to reacquire the shares under a Nov. 13 investment agreement.
Under the pact between WorldCom and Premiere, WorldCom will couple its voice and data network with Premiere's platform, making Premier a preferred provider to WorldCom of network-based computer telephone technology.
REED-ELSEVIER AND TIMES MIRROR FORM VENTURE
AMSTERDAM, Netherlands (Reuter) - Anglo-Dutch publishing group Reed-Elsevier said Wednesday it formed a joint venture with Times Mirror Co. to own and operate Shepard's, a U.S. legal citation service.
Reed Elsevier and Times Mirror said on July 3 they agreed to set up the 50-50 venture, and on Oct. 16 completed the first step in the deal when Times Mirror bought Shepard's from McGraw-Hill in exchange for the Times Mirror Higher Educational Group.
"As a result of this transaction, Matthew Bender, Shepard's and Lexis-Nexis are much better positioned to compete in the legal marketplace and pursue new joint opportunities for growth," said Mark Willes, Times Mirror's chairman.
Lexis-Nexis is a Reed Elsevier unit providing full-text online information services in the legal, news, business and government areas. Matthew Bender is Times Mirror's legal publisher.
Reed Elsevier and Times Mirror have a long-term cross-licence agreement to offer Matthew Bender publications online through the LEXIS database service and to provide a significant portion of the LEXIS caselaw database through Matthew Bender's print and CD-ROM products.
Reuters/Variety