January 2010

Companies Will Turn to China for IPOs

Veteran venture capitalist Dixon Doll predicts that more US technology companies will start holding initial public offerings in other countries as economic growth in Asia outpaces domestic expansion.

"In the next 10 years, I expect more portfolio companies to list on foreign exchanges," said Doll, founder of DCM. China "will become a big deal." The US venture-capital industry is coming off its slowest two-year stretch for IPOs since the mid-1970s, with only 19 in 2008 and 2009, according to the National Venture Capital Association. Doll said that while U.S. companies may not flock to China in the next year or two, the world's third-largest economy will be increasingly attractive for technology startups as its capital markets mature. China's gross domestic product will expand 8.5 percent this year and 9.3 percent next year, according to Bloomberg surveys of economists. That compares with average predictions for U.S. growth of 2.7 percent in 2010 and 3 percent in 2011, according to Bloomberg.

Cellular South to quit CTIA, citing favoritism for bigger companies

Cellular South, a small wireless service provider in the South, has left CTIA, the wireless industry's main trade group, after years of what the company describes as favoritism toward its biggest and highest-paying members. That favoritism has turned up on issues that impact small carriers most, said Eric Graham, Cellular South's vice president of strategic and government relations. On issues like handset exclusivity, data roaming, spectrum allocation and special access, CTIA has either been quiet or appeared to favor the Verizon Wireless or AT&T, the two largest carriers represented by CTIA, he said. As a result, Graham said, AT&T and Verizon Wireless have only gotten bigger while other companies are struggling to maintain their monthly subscribers, with many losing customers.

Reauthorization of America COMPETES Act Tops Committee's Agenda

House Committee on Science and Technology Chairman Bart Gordon (D-TN) said the top priority for his committee is the reauthorization of the America COMPETES Act; he hopes to move the bill through the House before the Memorial Day recess.

COMPETES is the landmark legislation, signed into law in 2007, based on recommendations from the National Academies. It aims to strengthen our national economic competitiveness through investments in science, technology, engineering and math (STEM) education; it sets our science research agencies on a doubling path (NIST, NSF, and DOE Office of Science); and it addresses the need for innovation in the energy sector by creating an Advanced Research projects Agency for Energy (ARPA-E) to pursue high-risk, high-reward energy technology development.

Net Addresses Running Out

The group that manages the Internet's address system said that the Internet is running out of unallocated addresses that use the old IPv4 protocol. Internet protocol addresses are the unique identifiers that allow computers connected to the Internet to communicate with each other. The Internet Corporation for Assigned Names and Numbers said the available number of IPv4 addresses has dipped below 10 percent. As a result, ICANN is urging the Internet community to do more to spur the adoption of the new IPv6 protocol. "For the global Internet to grow and prosper without limitation, we need to encourage the rapid widespread adoption of the IPv6 protocol," ICANN President and CEO Rod Beckstrom said.

DARPA to Award Funding for Projects Increasing High-Tech Education

Citing studies that show a marked decline in the number of students pursuing education in math, science and engineering, the Pentagon's Defense Advance Research Projects Agency (DARPA) is requesting proposals for "innovative new ideas to encourage students to major in CS-STEM and pursue careers as engineers and scientists."

CS-STEM (Computer Science, Science Technology, Engineering and Mathematics) education is seen as a vital to keeping the U.S. competitive in the 21st-century global economy. Yet data routinely shows that American students increasingly choose nontechnical education paths. In an RFP for a CS-STEM Education project posted Jan. 12, 2010, DARPA cites a study conducted by the Computer Research Association that found "there were 43 percent fewer graduates and 45 percent fewer [computer science] degree enrollments in 2006/2007 than in 2003/2004." The document also cites a 2008 New York Times article that found collegiate computer science departments reporting that women currently make up less than 10 percent of new computer science undergraduates.

Comcast's 'data meter' sparks questions about broadband caps

Comcast is rolling out a new tool so you can measure how much bandwidth you're consuming each month. The catch: If you repeatedly go over the limit, Comcast could kick you off for a year.

Comcast has been working on its "data meter" since 2008, when it began limiting residential broadband customers to 250 gigabytes of data usage per month. Before that, Comcast hadn't specified a usage cap but periodically cut of service to those who exceeded the cap, prompting complaints that it was throttling users. The "data meter" has been rolled out in Oregon and Washington state and will eventually be available nationwide, just as telecom providers are getting more interested in bandwidth limits and usage-based pricing plans to better manage traffic on their congested networks.

Participatory medicine: A high-tech alliance with patients

As physicians experience mounting pressure to contain costs and improve outcomes while their patient loads increase, many are finding that patients can be the most cost-effective and valuable tools to help them do their jobs. The concept of participatory medicine, where patients take a more active role in their care, can enhance the physician-patient relationship and allow physicians and patients to bring their own expertise and knowledge to the table to produce the best outcomes.

At its most basic level, participatory medicine means shared decision-making and deep patient engagement. Because of the rise in technology use -- as well as an increase in out-of-pocket health care expenses -- this has gone well beyond the traditional tell-me-where-it-hurts conversation between patient and doctor in the exam room. The business benefits of a participatory approach, especially as it relates to technology, have not been well documented. But proponents say adopting a participatory model of care can increase patient satisfaction, save time, reduce costs and improve care. Experts say the model of care also could lower liability risks for physicians. And patients who have a better understanding of their illnesses are likely to be healthier. Technology such as social networking sites, e-mail, personal health records, home monitoring devices and patient portals have made communication between patient and doctor not only more convenient but also more meaningful.

FTC's New Red Flags Rules: Are They the Right Cure at the Right Time?

[Commentary] Identity theft is a serious problem that causes its victims financial loss, inconvenience and mental suffering. Despite a wide range of different efforts to clamp down on identity theft, it continues to grow. A recent Federal Trade Commission report revealed that in 2008, the number of identity theft complaints exceeded 1.2 million, the highest number on record for any year since such complaints were tracked.

Medical identity theft, while far less prevalent than financial identity theft, is a major concern for consumers. It is thus not very surprising that legislators, consumer protection agencies and advocates continue to seek new ways to prevent identity theft of all kinds and mitigate the effects of identity theft when it does occur. One of the most recent efforts to combat identity theft is FTC's Red Flags Rules, a result of the Fair and Accurate Credit Transactions Act of 2003. Among other requirements, FACTA required FTC to enact rules to require financial institutions and "creditors" to develop programs to assist the government in detecting, preventing and mitigating "red flags" of identity theft. The rules were originally to take effect on Nov. 1, 2008, but were delayed several times -- first to May 1, 2009, then to Aug. 1, 2009, and then to Nov. 1, 2009. Most recently, FTC delayed the enforcement of the rules a fourth time, and they are now set to be enforced beginning on June 1, 2010.

Analyst: AT&T needs to spend $5 billion to catch up to Verizon's 3G

AT&T would need to spend about $5 billion on its wireless network to catch up with the coverage offered by Verizon Wireless, a financial research firm said Tuesday.

The public's perception of AT&T's network is poor and declining, apparently because of real shortcomings when compared with Verizon Wireless and Sprint Nextel, said Gerard Hallaren, director of research at TownHall Investment Research. The company hosted a conference call about AT&T for investors in conjunction with WJB Capital Group. TownHall announced it has reduced its rating of AT&T from "Favorable" to "Neutral." The second-largest U.S. mobile operator has been buoyed by its exclusive deal to sell the popular Apple iPhone -- an edge that is expected to disappear soon -- but has been shortchanging its wireless infrastructure at the expense of its wired network, Hallaren said. "It has a choice to spend or suffer," he said. According to TownHall, AT&T's capital expenditures on its wireless network from 2006 through September 2009 totaled about $21.6 billion, compared with $25.4 billion for Verizon and $16 billion for Sprint (including Sprint's investments in WiMax operator Clearwire). Over that time, Verizon has spent far more per subscriber: $353, compared with $308 for AT&T, Hallaren said. Even Sprint has outspent AT&T per subscriber, laying out $310 for network capital expenditure. That investment shortfall has been the major cause of AT&T's poor network performance, which has been reflected in tests by Consumer Reports and PC World, Hallaren said. Nine months ago, when TownHall first examined the issue, AT&T itself didn't understand how bad the situation was, he said. Top management now seems to understand the issue, though it's not certain AT&T will actually make the necessary investments, he said.

Benton

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