In 2001 the combination of an over invested stock market combined with a terror attack on American soil caused the greatest IT spending crash in the industry’s short history.  The need to cut costs made the industry more global and the US centric spending never fully recovered.

New data ranks the current world IT spending shrink as worse than what we suffered in 2001.

Based on current economic conditions and the word that Forrester is getting from the IT departments, Forrester is now saying that global IT spending for hardware, software, and services by companies and governments will drop by 10.6 percent to $1.53 trillion. In 2008, Forrester reckons that IT spending rose by 8 per cent to just over $1.7 trillion globally, and this year was slated to be bad, but not as bad as the IT budget downdraft in the wake of the dot-com, Y2K, and ERP booms in 2001 and 2002, when IT spending fell 6 per cent in both years. (The Register)

While most Americans suffering from the hard times cut their expenses and take second jobs, the insatiable appetite of pols grows. One possible benefit from the recession is it forces most of individuals and business to re-evaluate spending and priorities. That makes for a leaner and more efficient household or company as things improve. Politicians seem to be incapable of cutting anything and are too quick to blame that sales tax boogyman, the Internet. First it was North Carolina, next it’s Rhode Island. At issue are sales that were not shipped from either state, nor delivered there in most cases. In both cases, the states are now to lose more than they could have possible gained, because Amazon has pulled the plug on affiliates operating from both of those states. It’s time for state governments to get efficient, and maybe help get some bigger pipes built if they want to improve thier lagging revenues. Killing a small income stream for bloggers who are unfortunate enough to live in their states helps no one.

Amazon.com Inc. cut ties today with its business affiliates in Rhode Island to protest a provision in the draft state budget that would force the company to collect sales tax, Providence Business News has confirmed.

Rhode Island is now the second state where affiliates in the program, known as Amazon Associates, have been cut off over the sales tax issue. Earlier this month the Seattle-based online retailer also closed its affiliates’ accounts in North Carolina. (Providence Business News)

It has been announced that Pirate Bay, the audio/video/mp3/ogg/flac source site for things not paid for has itself been sold. Why a sucker? Well I will get to that after the jump –

The Pirate Bay has agreed to be sold for $7.7 million, a deal with a Swedish software maker that would ultimately turn the world’s most notorious BitTorrent tracker into a legitimate player.

The move by Global Gaming Factory X AB comes nearly three months after the four co-founders of The Pirate Bay were found guilty of facilitating copyright infringement, and face a year each in prison pending appeals in addition to a $3.6 million fine.

While the site is to discontinue pointing the way to free movies, music, games and software, Global Gaming Factory thinks it can turn The Pirate Bay into a money-making venture.

“We would like to introduce models which entail that content providers and copyright owners get paid for content that is downloaded via the site,” Hans Pandeya, Global Gaming’s chief executive, said in a statement.

Eh, Hans, you are the sucker.

This is not an issue about Pirate Bay going legit. I hope they do, I also hope they are successful at it. For if they are, they will be positioned to offer deep discounts on media, if the sources get a clue. If I could get a copy of ‘The Day the Earth Stood Still’ legit for $2.99 vs $19.95 off the storefront I would do so.

But that is not Pirate Bay’s draw. Bay’s draw was something for nothing. That and the ‘Tee Hee….’ mindset of ripping off The Man. I dare not call it counter-culture. Not quite that but almost. When the chic is off the rose then so goes the audience. That happened to Napster to a certain extent. The other fact is it is too easy to set up another site like it in Pakistan and have free competition vs paid service. Its the mindset in play here.

Possibly Pirate Bay will need to be renamed to Rum’s Cay and Media Emporium when the dust settles.

Linky.

OK this isn’t big news, but it does introduce some interesting possibilities. As part owner of the Clear service build that began as a partnership between Clearwire and Sprint, Comcast could add quite a bit of muscle to the marketing push for the new service.It’s beginning to look like a service that will be sold under many brands. One service with many brands, outlets and potentially different service levels is something we haven;t seen before in the wireless or broadband space

The so-called fourth-generation (4G) wireless service, is the first execution of a partnership between Comcast, Clearwire Corp and other companies that use the emerging WiMax high-speed mobile technology.

Many consumers already update their blogs and watch videos using their mobile phones. Cable companies such as Comcast and Time Warner Cable Inc do not want to become irrelevant by restricting subscriber access to the home.

The new service, called “Comcast High-Speed 2go,” is expected to deliver data to laptops, netbooks and other devices over a wireless network at faster speeds than has been commonly available to date.

Comcast said it will offer download speeds of up to 4 megabits per second. Existing 3G wireless networks typically offer download speeds between 1 and 1.5 megabits a second. (Reuters)

eBay’s plan to spin off Skype with an initial public offering in 2010 is being threatened by a dispute with the VoIP service’s co-founders, who still own a key part of the software.

Bloomberg reports Skype’s founders Niklas Zennstrom and Janus Friis have accused eBay of breaching a licensing deal and are threatening to yank the technology, which would disable the popular voice over internet service.

In return, eBay is suing Joltid, the company operated by Skype’s founders, in a London court to prevent the shutdown.

The Skype founders apparently retained the service’s peer-to-peer sharing technology when they sold to eBay for $2.6bn in 2005. (Which, of course, begs the question why eBay would pay all that money without ensuring they own the entire platform).

Well smart business people always work to sell the cow but license the right to the milk it produces. That appears to be what is happening here with a legal scuffle between Skype founders and eBay. So when Meg Whitman, who was the CEO that brokered that deal, plunk down the money she did not read the fine print on what she was really buying? Certainly appears that way regardless of the outcome of the lawsuit.

Would be a real blow to eBay if they lose. The value of the Skype property that they are trying to spin off would be worth less if the buyer has to pay royalities to the two gents owning the technology. Any buyer worth their salt would know this and only pay accordingly. For what they would really be buying is just the customer accounts and IT infrastructure.

There are still some fun things to watch in the IT biz.

Linky.

Consumers are calling for a boycott of telecom equipment makers Nokia and Siemens after the Wall Street Journal reported that the companies’ joint networking firm sold sophisticated internet surveillance equipment to Iran — a story that the company says is false.

Despite the denial, boycotters have written Nokia saying they’ve destroyed their Nokia phones, and are telling friends and family to avoid Nokia products until the company “can make the right ethical choices.”

According to the Journal, a system installed in Iran by Nokia Siemens Networks — a Finland-based joint venture between Nokia and Seimens — provides Iranian authorities with the ability to conduct deep-packet inspection of online communications to monitor the contents and track the source of e-mail, VoIP calls, and posts to social networking sites such as Twitter, MySpace and Facebook. The newspaper also said authorities had the ability to alter content as it intercepted the traffic from a state-owned internet choke point.

Will have to delve into this more. But it brings up a interesting phenomenon. Individuals as using the power of the purse, by not buying or not using products from a company based on their relationships with other entities. It may very well be the Achilles heel of the multinational corporation. With the world becoming more and more interconnected, the ability of persons to act locally for global impact. There are not many Corporations that can afford 1-2 quarters of lost revenue.

Linky.

The Dutch government is mulling over a tax on ISP’s so that the funds may be allocated to existing pulp print media. I kid you not. Here is the Google translation —

The committee Brinkman, who had to see whether the Dutch government financially ailing newspaper industry needs support, advises an Internet tax. This enables innovative online initiatives funded.

The advice for setting up an internet supplement is now presented to the Board by Minister Ronald Plasterk of Education, as reported daily newspaper Setting a surcharge on each Internet would be levied, the consumer aware that news and news not free.

In the opinion of the committee Brinkman is also calling for the proceeds of a levy in Internet online initiatives with the regional media stabbing. Moreover, publishers want to invest in Internet projects, on the low VAT rate of 6 percent to pay.

The opinion also states that the program of public service broadcasting for all media available to come. This would for example, self-publishing TV guides can spend. The committee does not decide on the partial funding of public broadcasting from advertising, a thorn in the eye of publishers, who argue that the market distorts STER.

The Brinkman committee was established at the request of the Second Chamber. Previously the government did know that the annual 4 percent of STAR revenues in the Stimulation Press will collapse, and that these funds are intended for Internet initiatives.

Can you imagine? Tax one line of business to maintain the status quo in another line of business. Of course it makes sense if you are a politician. You now get cart blanche on the editorial positions of the papers as you control the purse strings of those entities. Pravda anyone?

linky.
HT: Slashdot

Why I don’t know. But anyway it is going to happen in about two weeks. –

With Europe’s first femtocell deployment due in two weeks, it’s worth taking a moment to consider why you might want to spend your money on extending your operator’s coverage, if not just from general goodwill.

On Tuesday Vodafone announced that from 1 July UK punters will be able to buy their very own base station to extend Vodafone’s coverage, at their own expense and without so much as a discounted call or free data package to make up for the fact that punters could end up paying for the bandwidth twice.

So lets lay this out. Somebody will have to plunk down about $300 for the unit. They also have to provide a 1mb/s connection. They get no rebate from the carrier for doing so. And so why do I want this?

Its that wireless-wired interconnect that is the problem. The way things are here in the US as marginal areas morph to exurban homesites the wireless carriers follow right along. They are not stupid, and take note of traffic patterns. The problem is that on the wired side the cablecos and FIOS/uVerse guys don’t plant cable in the ground till a certain population density is reached. That is usually long after several cell towers have gone up. See the problem? The chances of having bad cell reception AND a cable connection is not going to be a plentiful situation for most areas. Maybe West Virginia, Western PA, some of the area of the Rockies. Femtocell is just not going to be a big seller.

More here.

As we prepare to unload a bunch of federally created funny money to extend the reach of broadband, it’s important to remember that government has a terrible track record of creating universal coverage. Much like the execution of Stalin’s famous central planning, the books were cooked to show great progress, while in reality there was little or none.

Need evidence? Here’s a compelling argument from Tech News World’s ‘Sonia Arrison:

A new public fund to subsidize Internet access for poor and rural residents is not likely to be effective. Consider the case of E-Rate, a US$2.25 billion FCC fund created in 1997 to connect all children to the Information Age by underwriting up to 90 percent of the costs of hard-wiring classrooms and libraries. Since its conception, however, E-Rate has been a bust. Public and private reports detail the regulatory loopholes, rubber-stamped “gold plated” networks, and criminal abuse.

After disbursing more than $20 billion in funds — collected, ironically, from fees that raise the cost of monthly phone bills — the FCC has still failed to establish basic accountability measures for E-Rate, and according to the Government Accountability Office (GAO) this March, excessive rules and paperwork keep thousands of schools from seeking reimbursements for legitimate costs. If the FCC is too inept to structure and manage our broadband funds properly today, what will make tomorrow any different? (Tech News World)

Millions in Soviet Russia lived their entire lives waiting for apartment flats to be built while they remained stacked in the existing units, for public transportation to reach outlying areas that still have none, and more. It’s better to open the right of ways and let that market or individual communities fill the void. Career Washington bureaucrats only know that rural America looks pretty from 8 miles above. No one knows how to get something done at ground level better than someone who is actually there.

In what has to be the biggest Hail Mary on record, the defendants in the Pirate Bay case will NOT be retried. As you may recall, a mistrial was requested after discovery that the judge in the case had dealings/relationships with entitles that the defendants had supposedly defrauded. But it is not all good either –

A Swedish appellate court ruled Thursday there would be no retrial in the Pirate Bay case, despite accusations the trial judge was biased against the four founders of the world’s most notorious BitTorrent tracker.

“We have reached the conclusion that we do not agree with the conflict of interest claim,” Sweden Court of Appeal Judge Anders Eka told Swedish media. In the appellate court’s written opinion, the three-judge panel said that backing “the principles” of copyright law “cannot be considered bias.”

In denying the appeal the original finding stands and the defendants must cough up the dough and face the jailer. Course in the end, they probably win again. With the right greasing of the palms Pirate Bay could be running in Khakistan in weeks.

Linky.