Compaq Computer said Tuesday it would take a US$4.7 billion charge against its 1998 earnings to cover the cost of acquiring Digital Equipment Corp.
Compaq CEO Eckhard Pfeiffer said he expects to show a net loss for 1998 due to the large charges, which include a $3 billion write-off on process technology, and a $1.7 billion restructuring charge.
"Given the magnitude of the restructuring charge we are taking, it will make the year negative, but you have to look at the difference between net and operating results," Pfeiffer told a news conference. "The restructuring is positioning the company for the future."
On Monday, Compaq (CPQ) said it had started firing 5,000 workers around the world to trim its operations.
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Primestar trial date set: A US court set a trial date on Tuesday of 1 February 1999 for the government's lawsuit to block the US$1.1 billion sale of a key satellite television slot by MCI and Rupert Murdoch's News Corp. to the Primestar consortium of cable operators.
Regulators fear the deal will stifle competition between satellite and cable TV systems. The Justice Department filed suit on 12 May to block the sale of one of only three satellite slots suitable for the Direct Broadcast Service.
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Ericsson unveils world phone: Ericsson (ERICY) unveiled what it said is the first wireless telephone to be able to roam almost anywhere in the world.
The "World Phone," expected to be available in late 1999, would work with almost all mobile telephone networks, including GSM 900 and 1800 MHz; D-AMPS 800 and 1900 MHz; and, traditional analog 800 MHz AMPS systems.
These modes represent more than 80 percent of the wireless phone market, Ericsson said.
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Bulgarian programmers to the rescue: George Soros has a cheap plan to put Bulgarian programmers to work and beat back the millennium bug.
The international financier and philanthropist has offered to pitch in US$3 million to set up a company in the former Soviet research empire to tackle things like the Year 2000 problem and the Euro currency conversion.
The project will be undertaken with the Bulgarian Telecommunications Company, which will provide the plant and infrastructure and will own 15 percent of the venture, to be called Rila Software. It will employ 500 of Bulgaria's 7,000 software professionals.
Bulgarian Telecommunications board chairman Grosdan Karadzhov said one of Soros' reasons for setting up the Sofia plant was expertise and cheap labor. Programming salaries in Bulgaria are about one-fifth of those in the West.
Earlier this year, the National Laboratory of Computer Virology, along with the Bulgarian Academy of Sciences, said it had found a way of dealing with the millennium bug. The head of the laboratory has said the cure was found during work to find ways of countering computer viruses, many of which originated in Bulgaria.
Reuters contributed to this report.
