GTE's Strategic Moves
In a flurry of activity May 6, GTE, Stamford, Conn., announced the purchase of BBN Corp., Cambridge, Mass., a major alliance with Cisco Systems Inc., San Jose, Calif., and the acquisition of a fiber optic network from Qwest Communications, Dallas. The deal for BBN is worth about $616 million. The moves are part of the company's push to become a leading provider of local, long distance, Internet and wireless services. GTE said they plan to have an advanced data network operating within a year.
Research Centers Defended
The Pentagon's technology chief has publicly trashed the proposal by a task force of the Defense Science Board to sharply cut the roughly $1.2 billion spent on the Pentagon's 11 federally funded research and development centers.
The proposal's rejection by Paul Kaminski, undersecretary of defense for acquisition and technology, followed a sharply worded internal rejection by top Air Force officials. "The [panel's] report is disappointing ... because the task force did not examine the subject we requested it to, and because the task force seemed ill-informed on the issues that it did address," Kaminski wrote in a late April letter to Craig Fields, chairman of the Defense Science Board, an influential group of advisers to defense policy makers.
However, Kaminiski is leaving the Pentagon on May 10, giving industry some hope that his successor will cut back the centers - and award some of their work to industry.
ITT Wins Heart of Army Internet
ITT Industries Inc., White Plains, N.Y., will be the sole supplier for the U.S. Army's Single Channel Ground and Airborne Radio System receivers and transmitters. The system is at the heart of the Army's tactical Internet system. The contract is worth $510 million.
According to Army officials, information technology is reshaping the structure of the armed forces. Future conflicts will require a single, secure network combining voice and data communications. The Army's goal is information dominance over adversaries.
All Eyes On Encryption
The Commerce Department has established a new, 25-member panel to advise government on encryption issues. The President's Export Council Subcommittee on Encryption may help industry lobby for easier export rules - or it may help the government corral political pressure to loosen restrictions on encryption technology. The council's members will be picked by William Reinsch, commerce under secretary for the bureau of export administration.
Northrop Grumman To Acquire Logicon
In a move designed to bolster its defense integration work, Los Angeles-based Northrop Grumman Corp. announced it will buy Logicon Inc., Torrance, Calif. Logicon is a maker of advanced defense electronics and training systems. The stock swap deal is worth about $740 million.
Fourth Quarter Results Taint BTG Earnings
Call it growing pains or maybe a little bit of bad timing but after going like gang busters for the first nine months of the year, BTG Inc., Fairfax, Va., hit a fourth quarter that saw one customer file for bankruptcy, a government agency fall through on another deal and a move to a new building that cost more than expected. For the quarter ended March 31, BTG announced that it likely will have a loss of 5 cents a share.
The quarter marred an otherwise stellar year. BTG expects revenues of about $400 million, up 87 percent from $213.6 million for last fiscal year; net income of $4.2 million, 42 percent higher than last year's $3 million; and earnings per share of 59 cents, an increase of 26 percent over the 47 cents in fiscal year 1996. The company will announce final figures after undergoing its annual audit.
Dell Brings New Dimension to GSA
Dell Computer Corp., based in Austin, Texas, has agreed to sell the Dell Dimension PC desktop family on the General Services Administration's federal supply schedule system. Citing price and product convenience, the technology can be bought off schedules for as low as $1,735.
The products include the Dell Dimension XPS Pro, with 32-bit performance; the Dell Dimension XPS and the Dell Dimension. The Dimension line won 93 awards from five PC magazines last year.
Making $7.8 billion in annual revenues, Dell is now listed on more than 60 federal indefinite-delivery, indefinite-quantity contracts. Federal customers can view all GSA schedule products on Dell's federal site at (http://www.dell.com/client/fed/).
Charitable Tax Break
Rep. Anna Eshoo, D-Calif., wants to give companies a greater tax break if they donate their old computers to public schools. Current law gives companies a greater tax break when they donate to private or parochial schools, but Eshoo's proposed bill, the Computer Donation Act, would level the playing field.
Smart Card Privacy
The multi-industry Smart Card Forum has adopted voluntary privacy guidelines intended to build consumer confidence in the cards, which can be used to store electronic cash, telephone charges, consumers' health data and other sensitive information. The guidelines were adopted "because it is smart business," said John Burke, counsel for the forum, which includes a wide variety of communications, banking and software companies, as well as the states of Ohio, Texas, Minnesota, Connecticut and Maryland. The forum will not punish any member companies that violate the voluntary guidelines, except to "let them wither and die because no one will buy their product," Burke said.
Build It and They Will Come?:
The Boeing Company, Seattle, has signed on to build the satellite system for much-hyped Teledesic, the Bill Gates/Craig McCaw satellite communications venture.
Boeing plans to invest up to $100 million in the privately owned project, giving it 10 percent ownership. The value of the contract is $9 billion. The plan is to create an international telecom network that will offer services such as Internet access, video- conferencing and intreractive multimedia.
The system will consist of 288 low-orbiting satellites that orbit about 50 times closer to earth than traditional geostationary satellites.
Teledesic, based in Kirkland, Wash., is expected to start selling the new service in 2002. The Federal Communications Commission on March 14 approved Teledesic's license to operate the telecom network.
Get Your Motor Runnin' ... Headin' Down the Highway
When spring fever hits, some people will do anything to get out of the office. Matt Williamson, an account representative at Network Software Associates Inc., a small software company in Arlington, Va., pitched the idea of a motorcycle tour to company executives as an innovative way to meet and greet clients. They bought it, and Williamson is off on a 14-city journey along the East Coast. Williamson left May 3 on the company-purchased Yamaha Virago bound for cities in Ohio, Indiana, Missouri, Tennessee, Georgia and Florida. And for every city he visits, the company plans to donate one computer to the Habitat for Humanity's Global Village effort to recruit more volunteers into the organization that builds housing for underdeveloped regions of the world.