Mannerisms

Thank God for Blair. Not Tony, Eric. In a world where fuzzy words are dreamed up to hide dirty practices, Eric’s nom de plume George Orwell gave us a template for the perversion of language.

‘Extraordinary rendition’ was one of Washington’s linguistic perversions, dreamed up to hide ‘extraditing for torture’.

Out of the HP shenanigans has emerged another. We all know it’s wrong to ring up an organization and pretend to be someone else in order to extract confidential information.

But two US lawyers advised HP executives that such a practice is legal.

Instead of calling it ‘obtaining confidential information by false pretence’, the lawyers called it ‘pre-texting’.

That Washington and Westminster have succumbed to Orwellianism is sad, but not unexpected when politicians are often adrift from reality.

It’s a lot sadder to see a great engineering company like HP adopt Newspeak.

If you see a ruddy-faced Bavarian going into a business meeting at 10 am with a massive glass of cloudy yellow beer in his hands, then you know it’s Electronica.

So many of Europe’s trade shows have declined or died, but Electronica has stayed huge.

“I don’t know if much business gets done there”, says an executive who has been to every Electronica for 30 years, “but it’s a terrific party.”

As everyone who made the journey to the World Cup Finals found out, Germans know how to throw a party, and whether much business is done, or not, everyone comes back from an Electronica with a good appreciation about what is going on in the industry, who is doing it, and what their friends are up to.

Unfortunate Electronica remark: at a Silicon Valley meeting in October between a group of European hacks and a US company, the CEO signed off with a cheery: “Come and see us at Electronica. We’ll have a barrel of beer on the stand”.

“American beer or German beer” asked a hack.

At this, up jumps the company’s PR officer: “Why should that make any difference?” she asked sharply.

Amid the hacks’ stunned silence, the CEO could just be heard shushing his patriotic, but obviously non-beer-savvy, PR specialist.

Stock Options

Rule number one on meeting CEOs and the like: the greater the gravitas, the dodgier the business practices.

Remember the remark: “The more he talked of his principles, the faster I counted the teaspoons.”

Before we’ve got bored with CEOs moaning about how unfair Sarbanes-Oxley is to them, we find they’ve been fiddling the dates of their stock options. And it gets worse.

They’ve not only been fiddling the dates the stock options were granted, so as to maximize the increase in their value, but they’ve also been also fiddling the date the option was exercised, to minimize the tax liability.

High-tech US companies have, reportedly, set aside over $5bn to cover potential liabilities.

For some people the good times have been rolling again before the ink is dry on the regulations designed to curb the excesses of the last boom.

That was a much more exotic boom. One will never forget the birthday party for the wife of Tyco’s CEO, Dennis Kozlowski, where a life-sized statue in ice of Michelangelo’s David had neat vodka running out of its penis.

The party, it transpired later, cost $2m and half of that was charged to Tyco as ‘Chairman’s Meeting’.

It’s a grand, if vulgar, life for some.

Electronica success

The show had 78,000 visitors which is an excellent result. Anything above 70,000 is good. This year’s total beat the 75,000 of 2004 and is the highest ever.

So Electronica is showing no signs of the fate which has overtaken so many of the great electronics shows. It is not declining. That’s an excellent thing. It means the industry has at least one, unspecialized, unfocussed event where everyone goes to meet suppliers, customers, rivals, and colleagues.

At last I see the ‘naked lady of Halle A6’ who I’d missed in Munich. In fact there were two of them which hadn’t realised before. Thanks to Matthew for sending me a video-link.

If there’s still no one who’s seen the talking point of Electronica 2006, then here’s the link:
http://video.yahoo.com/video/play?&ei=UTF-8&gid=g_20467ff00bc003b3ba1ef3e7ead0048e.20467ff00bc003b3ba1ef3e7ead0048e&vid=20467ff00bc003b3ba1ef3e7ead0048e.1222653&b=1

My apologies to Green Hills whose stand I had previously thought they were on. In fact they graced the Congatech stand.

A punchy piece in EETimes regrets the lack of Q&A at the Electronica CEO Forum.

This could well be because of the current insecurities of the CEOs of NXP and Freescale. It seems that Freescale’s CEO has not even got a contract from the new owners.

NXP’s CEO didn’t have an agreement settled with the new owners at the time of the press conference.

These CEOs may well be in a contractual limbo, controlled by groups of super-secret financial types who could easily parachute in an entire new management team if they took it upon themselves to dislike the cut of the CEO’s jib.

Possibly a sign of things to come. As the faceless money men move in on the industry, the ability of execs to speak their minds may well reduce.

As for the sudden no-show of STMicroelectronics’ CEO Carlo Bozotti, this probably wasn’t such a loss to the Forum.

Just as the Popes used to be named ‘the Good’ or ‘the Magnificent’, Bozotti should be dubbed ‘the Speechless.’ Questions don’t usually get answered very fully.

The current share scam scandal engulfing so many high-tech CEOs is rather boring compared with the last wave of excesses perpetrated by this gilded group.

One hopes that ‘fusion’ is not going to become an expression like 'ecosystem', ‘solution’, ‘disruptive’, 'platform', ‘embedded’ and ‘paradigm shift’ which have been over-used beyond the point of meaninglessness.

News that a former Siemens board member has been arrested for taking part in alleged slush fund payments raises the question: Why are the police bothered about it?

The summons to the CEO’s office at STMicroelectronics must seem a bit like an invitation to lunch from the Borgias.

After the DRAM price-fixing allegations which saw hundreds of millions of dollars paid in fines and jail-terms for execs, came the SRAM price-fixing probe which is still underway, and now comes the LCD price-fixing action which has hit Samsung and LG Philips and involves Sharp and AU Optronics of Taiwan.

So the UK government has decided to drop http://news.bbc.co.uk/1/hi/business/6181949.stmthe investigation into the bribes/commissions/agency fees paid for BAe Systems' Saudi Arabian defence contracts as was urged in Mannerisms yesterday.

The shenanigans which saw the ousting of HP's CEO are still rumbling on, with repercussions for the lawyers who gave her some very odd advice.

Chief Religious Officers (CROs) could be the way forward for scandal-hit companies according to findings by high-level US government officials and religious leaders

What happens in Vegas stays in Vegas is a local saying here, referring, I assume to the plethora of temptations on offer.

It's a good laugh seeing a scoundrel in a state of moral outrage.

The US high-tech industry seems to be riddled with scandal after scandal these days, with price fixing investigations, stock option lawsuits and with HP, Apple, Intel and Dell falling under the investigators' scrutiny.

Beijing's Silk Market is a Western shopper's Aladdin's Cave. Dolce & Gabbana, Gucci and Prada handbags for eight quid; silk robes for a tenner; Dior, Mont Blanc, Chanel and Gucci cuff-links for a couple of quid.

Will Steve Jobs do jail time? It's been exercising the tittle-tattle of Californian bars for some time

Some people really take the biscuit. How thick-skinned can you be? John Mayo, the former deputy CEO of Marconi who, with CEO Lord George Simpson, turned GEC from an industrial giant into a big fat zero, is now trying to tell Vodafone how to run its business.

It looks as if Intel will be adopting the ‘there seems to have been a bit of a misunderstanding M’lud’ defence to the EC’s charges against it, with Intel’s lawyer saying that it was ‘a failure of logic’ to suggest that payments made to allegedly delay launches of AMD-based products were part of any kind of anti-AMD activity.

One of the blemishes on American media is the Fox News Channel, a nastily warped news programme owned by Rupert Murdoch’s News Group.

Some explanation has emerged for the peculiar behaviour of Rambus over the years. It seems the company’s hyper-active approach to litigating with its customer-base derived from a group of activist investors.

Oh Dear. It looks as if the chickens are coming home to roost in the stock options scandal with a San Francisco court finding guilty the first guy to be put on trial for back-dating stock options, Gregory Reyes, former CEO of Brocade Communications Systems.

An STMicroelectronics/Infineon combination, if it happens. would create a formidable global force in two chip sectors: wireless and automotive.

Would an STMicroelectronics – Infineon merger work? Received wisdom in the semiconductor industry ihas it that mergers don’t work. And it’s received wisdom that the exception which proves that rule, is the merger between SGS and Thomson which formed ST.

With Intel said to be about to go into the solar power business we could be treated to some entertaining legal shenanigans about the exploitation rights to sun-rays.

A lot of people must be wishing they had their hands on that switch somewhere in Korea that can turn off the power at Samsung’s memory factories. Since the recent power outage at a memory plant in Kiheung, prices of memories have gone up, quite sharply in the case of NAND flash, and the memory manufacturers’ shares have also gone up.

Who’s going to be the scapegoat for the present financial mess? In previous messes the public authorities, usually in the US, have found people to blame and thrown them in jail. It looks as if the same thing may happen this time.

Rambus have been such clots that it’s hard to feel sorry for them now that the EC is bringing its great clunking hammer to crush this little, but irritating, nut.

What do management do when they haven’t got a clue? Answer: They announce a re-org. Samsung Electronics managers seem to be no different to managers elsewhere in the world. Last week, after a summer of dramas including slipping profits, bombed-out DRAM prices, a fizzled-out non-bid by US corporate raider Carl Icahn, and the mysterious, as yet unexplained, power outage at a DRAM plant, Samsung management announced a re-org.

What is it with Intel? Hard on the heels of it courting worldwide unpopularity by squaring up as a wrecker to MIT’s one-laptop-per-child (OLPC) programme, Intel has now got itself into a pissing match with India.

For a nation which, to outsiders, looks as if it takes life very seriously, the Japanese can be gloriously eccentric.

The Japanese are the politest nation on earth. You get welcomed when you walk into a shop, thanked when you walk out, bowed to at every opportunity, but sometimes they take it just too far.

There’s tremendous interest in Silicon Valley about the goings on at Maxim where CEO Jack Gifford resigned suddenly in December last year, and the company was de-listed earlier this month from the Nasdaq.

It’s interesting to see that the Silicon Valley-ites seem to have reacted to the back-dating of stock options scandal by indulging in a sort of linguistic denial, using words which suggest that back-dating stock options is some strange alien affliction which has come from outer space, rather than the result of anything they've done.

Samsung is adding to the general gaiety of the industry with a string of outrageous allegations worthy of the Koreans’ moniker: ‘The Italians of Asia’.

Samsung’s shenanigans have reached a new height of hilarity as it transpired that the Chairman of the Korea Independent Commission Against Corruption was one of the alleged recipients of bribes from Samsung’s slush fund, according to revelations disclosed by the Korean Catholic Priests' Association for Justice (CPAJ).

First joining, then ditching, MIT’s One-Laptop-Per-Child (OLPC) project aiming at giving a laptop to one billion of the world’s poorest children suggests that Intel, like Rhett Butler, no longer gives a damn.

The responsibility for the financial crisis falls on investment bankers, described as 'lobotomised sharks', who poured money into sub-prime mortgages and over-priced private equity deals in the run up to the start of the crisis last year.

The US National Law Review carries an article about the recent Qualcomm court debacle. The authors, two trial lawyers who are partners in the Chicago law firm of Jenner and Block, warn other lawyers: “Tell the judge the truth ......”.

“It brings up the world to its knees, and it's not even on the balance sheet”, said Malcolm Penn, CEO of analysts Future Horizons, talking at IFS2008 about the debt binge which is bedevilling hopes of economic expansion this year.

We could soon find out why the lawyers misled the court in the Broadcom vs Qualcomm case which turned on the question of whether any Qualcomm employee had sat on an industry standards-setting body.

Why do you sell a share for $20 which you’ve just bought for $19? Answer: Because you’re exercising a stock option which is about to expire.

Coming back from the US to T5 on Sunday was awful beyond awful. We were three hours late leaving San Francisco, had to circle for 40 minutes before landing at Heathrow and, when we landed, the captain said: “We’ve landed at Heathrow which is in chaos”.

It was shocking to hear Dr Dwight Decker, Chairman of the Global Semiconductor Alliance and Chaiorman of Conexant, say that the financial institutions are holding back innovation in the semiconductor industry.

IP is becoming a joke in the semiconductor industry with ‘patent trolls’ trying to gouge royalties by claiming the infringement of dubiously relevant patents.

In the Dubai desert, a group of semiconductor industry glitterati throw off their suits after the first day of the International Electronics Forum 2008 and and form a blues group.

It was good to hear the Director General for Competition at the European Commission, Philip Lowe, come out strongly at this week's Reuters conference in Paris against companies which unfairly use their patent positions to impose onerous licensing fees on the industry.

According to Lowe, companies should disclose: "Not just the technical parameters, but also the subsequent cost of licensing necessary to implement the standard."

Wolfgang Ziebart has been ousted as the CEO of Infineon after disagreeing with the supervisory board of the company about strategic direction. Peter Bauer, a management board member, takes over.

Europe's semiconductor industry is now under the control of Wall Street. A quarter of a century after the Siemens-Philips Megaproject, which aimed to give Europe an independent world-class microelectronics capability, Wall Street now calls the shots in Europe.

Leaks from the European Commission in Brussels suggest that the EC has decided against Intel in its anti-trust investigation.

What will the EU do with the expected gynormous fine on Intel for flouting anti-trust law in Europe?

Proof, if further proof were needed, that the Infineon supervisory board has gone barking mad, is that it appears to have abolished the CEO position and named Peter Bauer, the successor to outgoing CEO Dr Wolfgang Ziebart, 'Spokesman of the Management Board'.

Scott Fitzgerald was, apparently, quite right in saying that the rich are different from the rest of us. And thank God they are, because the credit crunch is showing how weird the lives of the rich are.

$25 million is, of course, petty cash to Intel, but the significance of the Korean competition authorities in finding Intel guilty of offering unfair subsidies to Samsung and Trigem Computer, if they promised not to buy x86 processors from AMD, could be that other national regulators will follow suit.

If ever there was a commentary on globalisation it is the story of

Freescale's fab in Scotland, now facing almost certain closure after 39 years.

Just as well to get your holidays in before the end of August because that's when the world may disappear into a self-generated black hole as CERN throws the switch on its Large Hadron Collider.

Apparently the South-West Regional Development Authority (SWRDA) is proposing to spend £300 million on a science park near Bristol.

With the Royal Bank of Scotland writing off over $10 billion of losses last week, that takes the total tally of losses written off by UK and US banks on sub-prime mortgage debt to over $400 billion since the start of the credit crunch.

Rambus, the memory interface specialist, was dealt the most fantastic cards, but appears to have had little clue about how to play them.

Tomorrow, unless a group of scientists led by German chemist Otto Rossler get an order preventing it from the European Court of Human Rights, CERN switches on its Large Hadron Collider (LHC). Rossler argues this may create a black hole into which we will all disappear.

How long before anyone ever again takes seriously the opinion of analysts, advisers and executives employed by banks and stockbrokers?

The good news is: 'The world has capital coming out its ears'. The even better news is that the guy who said that is the CEO of the Silicon Valley Bank Financial Group, which knows more about the finances of the US high-tech sector than anyone else.

There's a simple answer to the liquidity crisis - the government sets up a bank which takes deposits, lends money to businesses and individuals and keeps the financial system running until any surviving banks feel capable of returning to performing their normal functions.

An unexpected benefit of Gordon Brown's ban on short-sellers of shares is that the hedge funds appear to be shafted.

What level of pillock tries to put an egg yolk inside a potato? A two star Michelin chef level of pillock.

Interesting to meet Mentor Graphics people yesterday. Were they gloating about the problems over at rival Cadence? Of course not. Might they put in a bid for Cadence? Well it's a thought.

A sign of the times: chip companies are turning to lawyers to boost revenues. The US International Trade Commission reports the highest number of new IP complaints in 2008 since 1983 - a total of 42.

We've had an unprecedented amount of comments on the situation at NXP with a CEO transition from Frans van Houten to Richard Clemmer. In response to reader requests for a compendium of all these comments, here they are:

The fact that Citigroup can order a new executive jet a few weeks after taking $45 billion in tax-payers' bail-out money, shows that the bankers just haven't got it yet.

If the shareholders, investors and management of Rambus were readers of the novels of  Charles Dickens, they could have saved themselves a ton of money and decades of hassle.

Some semiconductor companies are operating in uncharted waters as they seek to borrow money to keep going. This is something new for the semiconductor industry which has traditionally been able to fund itself through recessions on the cash surpluses accumulated during booms.

The marathon Rambus legal saga is throwing up curious results. A US federal judge has ruled that Rambus was under no legal obligation to disclose its patent position while it sat on a JEDEC committee for determining DRAM standards.