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In brief: Salary deep freeze at AT&T

Jan 05, 20045 mins

Plus: Oracle’s PeopleSoft credit line; BMC grabs a little Magic; FreeBSD 5.2 to ship; Low-priced AOL’ offering; MS Office add-on for Sarbanes-Oxley requirements; and, Netegrity last week acquired Business Layers.

David Dorman, CEO at  AT&T, sent out a memo six days before Christmas telling employees there would be no pay raises in 2004. According to an AT&T spokeswoman, market conditions and the fact that raises were issued in September 2003 led the company to delay April 2004 raises until April 2005. AT&T also is expected to cut as many as 8,400 jobs, representing 12% of its workforce. Earlier in 2003 the company speculated it would reduce its workforce by 10%, but the percentage was increased toward the end of the year.

Oracle has arranged a $1.5 billion credit line for potential use in its bid to acquire rival PeopleSoft, the company said in a recent regulatory filing. Credit Suisse First Boston, ABN Amro Bank NV and other lenders have agreed to provide Oracle with a 364-day $1.5 billion revolving credit line, Oracle said in a filing with the U.S. Securities and Exchange Commission dated Dec. 24, 2003 and posted to the SEC’s Web site on Dec. 29, 2003. The money could be used to finance the acquisition of PeopleSoft and related fees and expenses, and for working capital purposes, according to the filing. Oracle already had arranged for a 364-day $5 billion credit facility with CSFB, according to Oracle’s Form 10-Q filing in December with the SEC. At the time Oracle said it could increase, decrease or supplement the $5 billion. Oracle launched its offer for PeopleSoft in June, when it submitted a $5.1 billion hostile bid for the rival. Oracle later raised its offer to $19.50 per share, or about $6.2 billion. The offer was pushed up to about $7.5 billion when PeopleSoft issued additional shares in connection with its acquisition of J.D. Edwards, according to the 10-Q filing. The bid for PeopleSoft has essentially been on hold pending a review by U.S. anti-trust regulators. Oracle earlier this month said it gave the U.S. Department of Justice all the documents requested to complete the review and said it expects the department to make its decision on whether the acquisition is anti-competitive early this year.

Network Associates has agreed to sell the assets of its Magic help desk and management division to BMC Software for $47 million. BMC said it expects to offer Magic Service Desk and Magic Help Desk after the acquisition is completed, which should occur in approximately two months. Magic Help Desk, which is aimed at small to midsize businesses, is a server-based product for automating and tracking work orders as well as monitoring purchase requests and asset management. is expected to formally release Version 5.2 of its open source, Unix-based operating system this week. Scott Long, a member of the FreeBSD release engineering team, says development of this latest version has focused on infrastructure improvements, such as enhancing performance of the network stack. It also provides greater support for Advanced Micro Device’s 64-bit processors and open source desktop Gnome 2.4, among other things. The full 5.2 release notes and Early Adopters Guide can be previewed here.

AOL is entering the low-priced ISP market with a service under the Netscape name that will be priced at about $10 per month. Customers can get the Netscape unlimited Internet access service for just $1 per month until March 1, according to a registration page on the Web site of AOL, a division of Time Warner. After that, the price will go up to $9.95 per month. The service includes nationwide access, personalized e-mail addresses for customers and a search service powered by Google, according to the site. AOL today offers unlimited dial-up access for $19.95 per month or $199 per year under the CompuServe brand. It also sells a $23.90-per-month unlimited dial-up service that comes with AOL 9.0 Optimized, a collection of enhancements such as e-mail, instant messaging and exclusive content. Those enhancements also are available for $14.95, along with five hours of dial-up access, for customers that buy their own broadband connections. A package with a broadband connection, called the AOL for Broadband-Cable/DSL Plan, costs about $55, according to AOL’s Web site.

Microsoft says it will deliver an add-on for its Office System designed to help companies meet reporting requirements set in the Sarbanes-Oxley Act. The Office Solution Accelerator for Sarbanes-Oxley is due out in March, the company says. It was created with the help of accounting companies and takes advantage of features in Microsoft’s Windows SharePoint Services and InfoPath 2003. Microsoft’s forthcoming Sarbanes-Oxley Office add-on is designed to help executives monitor financial data within their businesses. It provides functionality in four key areas: document and information management; process automation and workflow; collaboration and communication; and monitoring and reporting. The Sarbanes-Oxley offering, just as Microsoft’s other Office Solution Accelerators, will be available at no cost for Microsoft customers with a Software Assurance contract.

Computer security provider Netegrity last week acquired Business Layers, which makes provisioning software, for about $42.5 million. Of this amount, $15 million will be paid in cash and about $27.5 million in stock, Netegrity says. Business Layers provides software that lets companies provision applications and services across the enterprise. Netegrity says it plans to integrate Business Layers’ technology within the Netegrity identity and access management product, and also will continue to invest in the provisioning technology as a stand-alone product.