In the papers 31 July
Wednesday, July 31 2002
by Sylvia Leatham

The Irish Independent reports that Thomas Muldoon, an insurance salesman with an address in Waterford, has been given a two-and-a-half year prison sentence for advertising child pornography on the Internet. Muldoon pleaded guilty to the charge and was also given a concurrent sentence of 18 months for possession of a stolen laptop in 1999. The judge directed that Muldoon's name, address and offences be entered on the Register of Sex Offenders.

The paper also says that US payment services company First Data has taken a majority stake in Dublin merchant processors Omnipay. Read the full story on ElectricNews.net.

The same paper says the performance of Meteor, Ireland's third mobile phone operator, in the Irish market was one of the biggest disappointments of the year, according to independent mobile retailer Carphone Warehouse. It is believed that Meteor is losing subscribers on a weekly basis, but a Meteor spokesperson disputed the claim, saying the company has over 100,000 Irish customers and is growing its market share. Carphone Warehouse also released a trading statement, saying it has reaped the benefits of rationalisation at O2 Ireland and Vodafone. It said that because the two mobile phone companies had closed a number of shops, Carphone Warehouse connection volumes were up nearly 25 percent in the period beginning April to the end of July, compared with the same period in 2001.

The paper also reports that Kinetics Fluid Systems plans to open its European business hub in Dublin, creating between 30 and 40 new jobs and up to 60 new jobs within two to three years. Between 80 and 90 existing Irish staff will also be transferred to the new Dublin facility. Kinetics, soon to be renamed Celerity Fluid Systems, is a specialist in process system solutions for the semiconductor and biopharmaceutical industries.

The paper also says that Etel Group has appointed Achim Kaspar as chief operating officer of its Austrian subsidiary. Kaspar has been the managing director of WorldCom Austria since 1999.

The Irish Times says top executives at Qwest Communications reportedly made half a billion dollars selling company stock from 1999 to 2001, while the firm was exaggerating profits through improper accounting. Qwest admitted on Sunday it improperly accounted for more than USD1.1 billion of transactions during the last three years, enabling it to show positive returns and maintain an inflated stock price. Joseph Nacchio, the chief executive who was forced to resign last month, made USD227 million, according to Thomson Financial, while Robert Woodruff, former chief financial officer, made USD29 million. Former chief strategy officer Lewis Wilks made USD49.3 million, former executive vice-president Stephen Jacobsen received USD46.3 million, and former chief information officer Brij Khandelwal got USD46 million.

The paper also reports that despite opposition from several large investors, Vodafone shareholders are likely to approve Chief Executive Officer Sir Christopher Gent's controversial remuneration package at the company's annual meeting on Wednesday. The package would see Gent receive over 9 million share options and performance and bonus shares up to STG3.9 million, on top of his basic salary of STG1.2 million. The payout has angered shareholders, who have seen the value of their shares halve since January.

Meanwhile, according to the Financial Times, Bertelsmann Vodafone has admitted using accounting techniques that inflated its annual revenues relative to some of its rivals. The company said that in some cases it had booked all the revenues from wireless Internet services as turnover even when a portion of them was paid to third parties as part of content-sharing deals, a practice that seems to be at odds with that of some other mobile operators. Vodafone has defended the practice, saying that it considered every revenue-sharing deal on a case-by-case basis and only booked payments made to third parties as revenue when it collected payments from mobile phone users. Vodafone's accounting practice complies fully with UK standards, but some analysts expressed surprise at the accounting practice, pointing out that it could flatter the group's average revenues per user (ARPU) figures.

The paper also says that Bertelsmann is to consider selling off its UK assets, dominated by a 65 percent stake in Channel 5, following the abrupt departure of chief executive Thomas Middelhoff. Gunter Thielen, new chairman and chief executive, has ordered a fundamental review of the group, which suffered a fall in profits in some key businesses. He is also expected to review some of the German media group's US operations, including its Napster Internet music service.

The Wall Street Journal reports that a top US telecommunications regulator has said that the government may be unable to prevent WorldCom from abruptly terminating its Internet services. The comment by Federal Communication Commission chairman Michael Powell came at a hearing of the Senate Commerce Committee called to explore the impact on telecom services of the bankruptcy filings and accounting scandals in the sector. Powell assured legislators he could force WorldCom to continue providing phone services to customers, but he was unsure if he had the legal authority to stop the company from shutting down its UUNET subsidiary's Internet backbone. Powell's remarks prompted calls in Congress for sweeping legislation to expand the FCC's authority.

The same paper says that Microsoft is expected to announce a deal with AT&T Wireless Services to sell a variety of wireless software and services to business customers, according to people familiar with the situation. The deal could usher in the US debut of Microsoft's Pocket PC Phone Edition, which runs small, hybrid devices that combine the features of mobile phones and Pocket PC handheld computers. The phones are currently being sold in Europe by mmO2 and Vodafone. A Microsoft spokeswoman and an AT&T Wireless spokesman both declined to comment.