Foxconn in secret talks with Trump

Foxconn, including its grand pooh-bah Terry Gou, had secret talks with the White House presumably looking for sweeteners for a $7 billion plus US investment in a display making plant.

TVBS television showed Gou entering and leaving one of the entry gates of the White House with senior company executives including Tai Jeng-wu, Foxconn vice chairman and chief of Japan’s Sharp, in which Foxconn holds a two-thirds stake.

When asked by reporters on his way out of the White House if he had met US President Donald (Prince of Orange) Trump, Gou responded: “My memory is not good. Maybe I already forget.”

While most people would want to forget three hours in the presence of Trump, it is unlikely and Gou just does not want to talk about it.

Gou had said in January that Foxconn was mulling setting up a display-making plant in the United States with an investment that would exceed $7 billion.

Gou provided the details at the time after Foxconn’s business partner Masayoshi Son, head of Japan’s SoftBank Group, pledged a $50 billion investment in the United States when meeting Trump in December, while accidentally showing materials that had Foxconn’s logo.

The expansion into the United States by several global corporates comes amid Trump’s “America First” efforts to expand US jobs.

While Foxconn has not disclosed a timeline for a decision on going ahead with the plant, it would depend on many factors, such as investment conditions, that would have to be negotiated at the US  state and federal levels, Gou has said.

Microsoft profit slumps a bit

Software King of the World Microsoft slightly missed Wall Street’s average revenue estimate for the latest quarter on Thursday.

The Tame Apple Press has rushed to blame Vole’s sales of its Surface tablets and laptops slump in the face of revamped competition in the personal computer market. The revamped competition being that Apple has something new out which has also proved disappointing.

In fact, Microsoft’s figures were not that bad. Cloud margins improved and the company’s annual commercial cloud revenue run rate reached $15.2 billion, a 50 percent year-on-year improvement. It marks good progress toward its goal of pushing the figure to $20 billion by 2020.

Nadella said Microsoft reached 100 million monthly active users for Office 365 commercial, the firm’s flagship cloud productivity software, the first time Microsoft has given such a figure.

For the fiscal third quarter, ended March 31, overall revenue on an adjusted basis climbed 6 percent to $23.56 billion, but missed analysts’ average estimate of $23.62 billion.

Revenue from Microsoft’s personal computing unit, its largest by revenue, fell 7.4 percent to $8.84 billion. Analysts on average had expected revenue of $9.22 billion, according to research firm FactSet StreetAccount.

The business includes Windows software, Xbox gaming consoles, online search advertising and Surface devices.

Surface revenue plunged 26 percent to $831 million, down from $1.3 billion in the year-ago quarter. And the reason is that Microsoft has yet to refresh its Surface range – which has been on the market now for a while.

Microsoft’s Windows OEM revenue, a measure of the company’s license revenue from computer makers such as Dell and HP, rose five percent. Dell reported strong increases in computer sales driven by high-end laptops.

Revenue from the unit that Microsoft calls “Intelligent Cloud,” which includes server products and the company’s flagship cloud computing platform, Azure, jumped about 11 percent to $6.76 billion in the quarter.

Azure revenue soared 93 percent in the quarter. The service competes with Inc’s Amazon Web Services, the market leader in cloud infrastructure, as well as offerings from Alphabet Inc’s Google, IBM and Oracle Corp.

Microsoft’s commercial cloud gross profit margin reached 51 percent, up from 48 percent the previous quarter. Microsoft has been emphasizing higher-margin premium products such as databases and recently started building its own servers rather than relying on Hewlett Packard Enterprise, driving the cloud margins higher, analysts said.

Microsoft also, for the first time, reported a revenue growth rate for Dynamics 365, its competitor to Inc’s online sales software. Revenue grew 82 percent in constant currency, though the firm did not give an absolute dollar total.

Microsoft said LinkedIn, which it bought for about $26 billion, contributed $975 million in revenue in the quarter, $25 million more than analysts had expected.

The company’s net income rose to $4.80 billion, or 61 cents per share, in the quarter, from $3.76 billion, or 47 cents per share, a year earlier.

Tech firms not worried about war with North Korea

Global electronics firms are not particularly concerned if Donald (Prince of Orange) Trump declares war on North Korea.

There is some concern among the Tame Apple Press that Apple will not be able to source key parts from South Korea if a war starts. Never mind the huge body count that is expected – just so long as Apple fanboys get their toys.

Trump told Reuters that a major conflict with North Korea is possible in the standoff over its nuclear and missile programmes, though he would prefer a diplomatic resolution. But then he might have changed his mind by the time he popped around the corridor.

South Korea, a US ally and home to major electronics parts makers such as Samsung Electronics, LG Display and SK Hynix, would be particularly vulnerable to any military attack from its northern neighbour.

South Korea supplies more than half of components such as memory chips and flat screens.

However, investors are pouring money into South Korea’s financial market, and companies are flocking to the stock market to raise billions of dollars.

Seoul’s stock market has climbed nine percent so far this year to near record highs, helped by strong earnings by major exporters including Samsung Electronics, which rose three percent to a life-time high on Friday after reporting its highest profit in more than three years.

Earlier this week, Hynix and LG Display, both Apple suppliers, reported record quarterly profits and sounded upbeat for the remainder of the year.

LG said that talk of conflict is speculative, and it did not have any plans to react to the current situation.

Hyundai Motor, the country’s top automaker, said it had detailed contingency plans to ensure business carried on under various situations but couldn’t disclose them.

Any military conflict on the Korean peninsula could have a dramatic effect on the memory chip market in particular, as Samsung’s and Hynix’s main operations are clustered in South Korea.

The pair control half of the flash memory market, and almost two thirds of DRAM chips, widely used in computers, making it almost impossible for customers to find alternative supplies quickly.

As supply of those chips are already tight, any interruptions to their manufacturing operations might cause large customers such as Apple and Lenovo to trigger a contractual term known as an “allocation” to get more of their suppliers’ limited supply, according to industry executives.

The ultimate beneficiaries of supply interruptions in South Korea would likely be Japan’s Toshiba, and US  firms Micron Technology and Western Digital.

Amazon’s cloud and retail booming

Amazon retail and cloud computing sales rose in the first quarter, better than what the cocaine nose jobs of Wall Street predicted.

The online bookseller said sales rose 23 percent to $35.7 billion, just beating analysts’ average estimate of $35.3 billion.

More fees from Amazon’s Prime shopping club and media streaming services, along with growing advertising revenue, also boosted results.

Profit, which has traditionally been fleeting at a company that focused on growth, was also ahead of expectations. Net income rose 41 percent to $724 million, or $1.48 per share, marking the eighth straight quarter that the company posted a net profit. Analysts on average were expecting $1.12 per share.

Amazon’s revenue has soared in recent years as shopping has moved online and businesses have moved their computing operations to the cloud, where Amazon Web Services (AWS) is the biggest player. AWS accounts for much of Amazon’s operating profit.

Amazon Prime, which offers fast shipping and video streaming to members, helped raise the company’s subscription sales 49 percent from a year earlier to $1.9 billion. Sign-ups have been key to Amazon’s strategy because Prime encourages shoppers to buy more goods, more often.

Sales from AWS, the company’s fast-growing business to host companies’ data and handle their computing in the cloud, rose 42.7 percent to $3.66 billion, matching the average analyst estimate.

Amazon posted an operating loss of $481 million in its international segment, which is four times its loss a year earlier for the segment. The company has said it is investing more than $5 billion in India to gain market share, and this month it announced plans for a retail marketplace in Australia.

Amazon Chief Financial Officer Brian Olsavsky said that a lot of the same playbook seen working in the US is being rolled out internationally.

Seattle-based Amazon forecast that operating income in the second quarter would be between $425 million and $1.075 billion, below the average estimate of $1.46 billion, according to FactSet StreetAccount.

The company forecast sales for the second quarter of between $35.25 billion and $37.75 billion, which includes an unfavourable impact of about $720 million from foreign exchange rates.


Samsung makes a killing

Samsung had earnings which were stronger than a Sardinian cheese after posting a solid first quarter profit boosted by its memory chip business.

While the first quarter was miserable for Samsung as its boss Jay Y. Lee was swept up in a political corruption scandal, the world’s top maker of memory chips, smartphones and televisions still managed to book a profit that supports expectations for record earnings in 2017.

First quarter operating profit for Asia’s most valuable company by market capitalization was $8.75 billion, matching Samsung’s earlier guidance. Revenue rose two percent.

Samsung Electronics shares were up 2.6 percent at a record high in a flat wider market.

“Looking ahead to the second quarter, the company expects to achieve growth on the back of continued robust memory performance together with improved earnings from the mobile business,” following the global rollout of the new Galaxy S8 smartphone, Samsung said in a statement.

Samsung’s chip business remained the top earner, thanks to price gains for both DRAM and NAND memory chips.

The mobile division reported January-March operating profit of $1.82 billion, down from $3.4 billion year earlier. To be fair, though, Samsung had no new premium product generate meaningful sales in the January-March period.

Pre-orders for the Galaxy S8 launched in April were better than many analysts had expected.

Hackers exploited a Word hole for months

Hackers exploited a hole in Microsoft Word while Vole effectively tried to get more detail on the flaw.

The flaw, CVE-2017-0199, was dangerous but not difficult to fix but allowed a hacker to seize control of a personal computer with little trace. After nine months, it was fixed in Microsoft’s last regular monthly security update.

While Vole “investigated”, hackers found the flaw and manipulated the software to spy on unknown Russian speakers, possibly in Ukraine. It was also used by a group of thieves used it to bolster their efforts to steal from millions of online bank accounts in Australia and other countries.

Last July, Ryan Hanson found a weakness in the way that Microsoft Word processes documents from another format. That allowed him to insert a link to a malicious program that would take control of a computer. He told Microsoft in October after working out that the vulnerability could be mixed with something which made it even nastier.

Microsoft could have fixed the problem – all it took was a quick change in the settings on Word, but if it  notified customers about the bug and the recommended changes, it would also be telling hackers about how to break in. It could have patched the flaw but it thought it would be better to “dig deeper”, since no one was using Hanson’s method, and it wanted to be sure it had a comprehensive solution.

Microsoft performed an investigation to identify other potentially similar methods and ensure that our fix addresses more than just the issue reported.

It was complex – a little too complex. Because while Vole was going deeper the unknown hackers initially found Hanson’s bug and started using it.

The first known victims were sent emails enticing them to click on a link to documents in Russian about military issues in Russia and areas held by Russian-backed rebels in eastern Ukraine, researchers said. Their computers were infected with eavesdropping software made by Gamma Group, a private company that sells to agencies of many governments.

It appears that one of Gamma’s customers was trying to get inside the computers of soldiers or political figures in Ukraine or Russia,  either of those countries, or any of their neighbours or allies, could have been responsible. Such government espionage is routine.

In March, security researchers at FireEye noticed that a notorious piece of financial hacking software known as Latenbot was being distributed using the same Microsoft bug.

FireEye probed further, found the earlier Russian-language attacks, and warned Microsoft. The company, which confirmed it was first warned of active attacks in March, got on track for an April 11 patch.

McAfee saw some attacks using the Microsoft Word flaw on April 6. It established that the flaw had not been patched, contacted Microsoft, and then blogged about its discovery on April 7. McAfee Vice President Vincent Weafer admitted that leaking the information was “a glitch in our communications with our partner Microsoft”.

The blog post contained enough detail that other hackers could mimic the attacks.

By April the 9th, a program to exploit the flaw was on sale on underground markets for criminal hackers.

Finally, on Tuesday, about six months after hearing from Hanson, Microsoft made the patch available.

It is unclear how many people were ultimately infected or how much money was stolen.

German hackers ask cash for their work

You have to admire the balls of a group of German hackers who dub themselves XMR Squad.

The outfit spent all last week launching DDoS attacks against German businesses and then contacting the same companies to inform them they had to pay $275 for ‘testing their DDoS protection systems.

Attacks were reported against DHL, Hermes, AldiTalk, Freenet,, the State Bureau of Investigation Lower Saxony, and the website of the state of North Rhine-Westphalia. The attack against DHL Germany was particularly effective as it shut down the company’s business customer portal and all APIs, prompting eBay Germany to issue an alert regarding possible issues with packages sent via DHL.

While the group advertised on Twitter that its location was in Russia, a German reporter who spoke with the group via telephone said: “The caller had a slight accent, but spoke perfect German.”

Following the attention it got in Germany after the attacks, the group had its website and Twitter account taken down.

Hackers mocked the group for failing to extract any payments from their targets. DDoS extortionists have been particularly active in Germany, among any other countries. Previously, groups named Stealth Ravens and Kadyrovtsy have also extorted German companies, using the same tactics perfected by groups like DD4BC and Armada Collective.

Nokia sees Finnish of bleak sales

Finnish network equipment maker Nokia reported a slowing rate of sales decline, saying the global networks market was showing signs of recovery.

Nokia and its rivals, Sweden’s Ericsson and China’s Huawei Technologies, have struggled in recent years as telecom operators’ demand for faster 4G mobile broadband equipment has peaked, and upgrades to next-generation 5G equipment are still years away.

Nokia said the business momentum was now improving: first-quarter network sales fell six percent from a year earlier to $5.3 billion, compared with a decline of 14 percent in the previous quarter.

Chief Executive Rajeev Suri said: “We slowed the rate of topline decline and generated healthy orders in what is typically a seasonally weak quarter for us… We saw encouraging stabilization in Mobile Networks topline… “I am optimistic about the year ahead, even if cautiously so.”

Nokia repeated that it expects its networks sales to decline in the full year, in line with the market.

Its first quarter group earnings before interest and taxes fell one percent from a year earlier to $371 million, slightly ahead of analysts’ average forecast.

Last year, Nokia bought Franco-American networks firm Alcatel-Lucent in response to industry changes, and is currently axing thousands of jobs.

That deal helped Nokia outperform rival Ericsson, which earlier this week posted a quarterly operating loss.

Google is Home alone

Google OgleI’m not too sure just which phrase sums up the internet of things (IoT). In these early days, perhaps it’s the Wild West of legend or maybe it’s like Sicily during the bad old days of the Mafia. Is it gunslinging or a quick shot to the back of the head by one of the families?

The whole question has become very real to me in the last few days since Currys sent me Google Home to review.

Let me first of all describe my own internet setup here in Oxford and that will give you some idea of my conundrum. Or is it a dilemma? You can ask Google H to define a conundrum. And a dilemma. Oh and sometimes it uses Britannica as a source and at other times Wikipedia. There’s some kind of editorial judgment going on here but who is the editor, or team of editors? That is another Google puzzle. But as the lady says – and more of this later – “she is still learning”.

Google Home unitI run a fast Virgin Media broadband connection here with several devices depending on it, including a PC in the mancave at the end of my garden. I am a subscriber to Amazon Prime, have a Roku TV connected to the interweb and a smarty pants phone or two. I’ve also got Philips’ Hue lighting upstairs, downstairs and in my mancave. This Google stuff doesn’t half open up some braincells. But, let me tell you definitively, the Google robot does sometimes get it wrong. Yesterday I asked the lady of the house – that’s Google Home – whether it would rain. She came back with a pretty firm “no”. So I walked four yards and stood outside the back door where it was pouring it down.

It took me a day or two to decide my attitude to the new lady in my house. At first I was talking to her in a rather nasty tone and sometimes shouting too. But I decided to be nice to robots – they’re people too. Or some people are robots. The lines are getting blurred.

Right now Google Home in the UK comes with only one voice, coming with received pronunciation. It would be nice if in the future the designers could tweak the voice so that you could have, for example, a man or a woman speaking in a Brummy, Glaswegian or Cockney voice. A USA version now supports the ability for the machine to recognise up to six different voices – apparently we’ll get that upgrade here soon enough.

There’s a bit of a security problem too. A neighbour of mine, for example, managed to shout a command through my letterbox turning on a Barry Manilow album remotely – he’s not my favourite artist. But once you’ve got music playing you do really need to shout to turn it off – she couldn’t do that from outside my front door. I can imagine domestics too, where different members of a family override requests made by another.

There’s another, and in my view, more serious security problem. My neighbour, the one who shouted through my letterbox and according to Google Home is only 26 feet from my house – by car. I don’t use the car I don’t have to sometimes go over there but if I do need to access the internet, she has given me a password for her wi-fi system. Because the security is so poor, so far, on this device it means that I can access her device, play music on her machine, access the requests she’s made. Google really needs to address this problem.

And it would also be useful to be able to customise requests to the machine. Now, you have to start a request by saying “OK Google” or “Hey Google”. I’d like to say things like “Hi Darling”. Oh well, maybe not.

It does feel strange talking to a machine at first, but these days, of course, it’s very common to see people walking down the street apparently talking to themselves. When I was a kid, we used to think people like that were nutters. But everybody is a nutter in the 21st century.

The number of devices supported is really quite limited so far but include smart thermostats, lighting and other gizmos. I have a Roku system running on my TV, but Google doesn’t support this and I expect it never will, considering that it sells its own TV system, Chromecast. Which is supported, surprise, surprise. While it supports Spotify, Google Play and Tune In, currently it only supports Youtube in the USA.

You won’t be surprised to learn that it doesn’t support Amazon Music.

The device list includes Nest thermostats, Philips Hue, Samsung SmartThings, Belkin Wemo, Osram, TP-Link and a few others. Streaming devices supported include Vizio, Toshiba, Philips, Sony, Bang & Olufson, Grundig, and Pol Audio.
There are some other third party services available in the USA, but not here yet, according to the Google Home page.

Hue lighting systems are pretty expensive but I have several lights in my little house. It’s neat to be able to turn upstairs lights on by simply saying, “OK Google, turn upstairs on”. Google Home is downstairs in my back room, but if you shout commands down the stairwell she does listen to you.

Some of the features are really pretty good. You can build a shopping list but, as yet, you can’t delete it by voice command, only by using the app. And her recognition is a bit wobbly for some artists. She just couldn’t handle Yves Montand nor Françoise Hardy – but the Spotify app on your smartphone is a good way to browse for the gazillions of titles available on the service.

She/He/It also does a pretty fair job translating into other languages, as far as we can tell. The same neighbour who shouted through my letterbox is pretty fluent in Italian and was happy with the results.

This is a piece of cake. You plug Home into a spare socket, and download the Home app for either your Android or IOS device. When you run the app, it prompts you to enter different details – for example your wi-fi connection. When you’re done, you simply talk to the little blighter prefacing the request with either “OK Google” or “Hey Google”. Currently, Home supports both Spotify and Google Play – with Google enticing you to try a free subscription for the latter. If you want to use Spotify, you’ll have to upgrade to its Premium service. That costs £10 a month.

The basic Google Home system costs £129 here. But if you want to customise your gizmo by, for example, having a purple colour base, you can spend an extra £18 or so to do just that. Buying a system including Hue lighting, a smart TV, Chromecast and so on will cost you a pretty penny.

Google Home is a bright idea but there are some problems. Why, for example, does it not have access to the full search facilities of Google itself? For example, if you search for a person using a browser you get a wide range of results – but Home appears only to come up with Wikipedia and occasionally Brittanica results. Narrowing things down is a little bit tricky unless you’re confining yourself to running your Hue lights or finding out the weather rather than just looking out of the window. Google hasn’t migrated all the services to UK customers that it offers in the US, but perhaps when that happens the search facilities will be better. Oh, and the faster your internet connection, the better…

Thyssenkrupp sets up 3D printing centre

German industrial group Thyssenkrupp is to open a 3D printing centre this year to manufacture products for its customers.

For those who came in late, Thyssenkrupp is famous for making steel, submarines and elevators, and supplies thousands of tonnes of metal and plastic products and provides supply-chain management services to a quarter of a million customers worldwide.

Some industrial components such as airline or wind-turbine parts can now be made by 3D printing, or additive manufacturing, in which objects are printed in layers directly from a computer design instead of being cut out of blocks of material.

This saves money on material costs by reducing the number of parts needed tenfold or more, and also saves time from design to manufacturing, allowing objects to be produced in small batches in a cost effective way.

Hans-Josef Hoss, an executive board member of Thyssenkrupp Materials Services division, said the company had invested already into the machines and the people.

“We start from the engineering side and deliver the final product with all aftersales and related services,” he said in a speech at an event during the Hannover Messe, the world’s biggest industrial fair.

Hoss said the centre would be inaugurated in September, and would produce both metal and plastic products.

General Electric is investing $109 million to expand a German 3D printing firm it bought last year – one of two it acquired at a total cost of over $1 billion – and would open a 3D printing customer centre in Munich.

Beancounters at Wohlers Associates think the use of 3D technology is surging. Sales reached $1 billion in 2007, jumped to $5.2 billion in 2015 and will hit $26.5 billion by 2021.