Microsoft is starting to shift jobs from the United States to India as it seeks to lower technical support and development costs, the world's largest software maker said.
Microsoft (MSFT), long seen as a growing company immune to job losses, is now considering cutbacks in the United States while increasing staff in India, which turns out tens of thousands of English-speaking software engineers each year.
Boosting its employee ranks in India also became a priority for the company after its chairman, Bill Gates, made $400 million in Indian investments. So far, Microsoft has about 200 engineers developing software in the south India city of Hyderabad where it opened its first non-U.S. product development center.
- - -
PeopleSoft offers Oracle poison: PeopleSoft, which has rejected Oracle's $6.2 billion, all-cash, hostile takeover bid, surprised Wall Street by saying that its key software license revenues would be significantly higher in the second quarter than analysts had expected.
PeopleSoft (PSFT) said over half those sales would come from contracts covered by a new customer protection program that industry watchers said was a takeover defense in disguise. Those contracts include a clause that says if PeopleSoft changes hands, the buyer would be required to rebate two to five times the amount of the original license agreement.
The contracts are a novel tactic that will fuel better-than-expected quarterly results and double as a poison pill defense to Oracle's (ORCL) bid, financial analysts said. One Silicon Valley attorney said it was unclear whether the "poison contracts" are legitimate and if, like traditional poison pills, they could be dissolved.
- - -
WorldCom keeps on paying: Former shareholders burned by WorldCom's accounting fraud scandal would receive $250 million in company stock under a revised settlement the bankrupt telecommunications giant is hoping will win court approval.
Shares in the newly reorganized company would be added to $500 million cash the Securities and Exchange Commission had suggested in an initial settlement, which critics harshly denounced as inadequate for shareholders who lost money because of WorldCom's fraud.
WorldCom filed its new proposal with the federal courts overseeing its bankruptcy and civil fraud cases. WorldCom would issue the shares after the company's new stock is trading. The shares would allow fraud victims "to share in the potential upside of owning WorldCom common stock when it emerges from bankruptcy," the SEC said in a statement.
- - -
Sharp, SAP go mobile: German software giant SAP AG and Japanese electronics maker Sharp will develop and market mobile communications services for companies, initially targeting the Japanese market, the companies said.
Sharp will develop software and handheld devices compatible with SAP (SAP) software, allowing workers to retrieve corporate data while away from the office by using mobile devices like cell phones and personal digital assistants, according to the companies.
Global demand for such products is growing rapidly. The companies estimate 17 million corporate users worldwide, with 1.2 million in Japan alone. The companies are focusing on the Japanese market first although they hope to expand later to North America, Europe and the rest of Asia.
- - -
Spammers will pay: An e-mail spam operation that promised people cash for stuffing envelopes at home will refund more than $200,000 to settle federal charges that it deceived consumers, regulators said.
The Federal Trade Commission had accused the operation of using spam to sell consumers letters and pre-stamped, pre-addressed envelopes for a $40 fee. The operation told consumers they would earn $2 for every envelope stuffed, but people who paid the fee did not receive envelopes.
Consumers who paid for the business opportunity with Stuffingforcash.com, Sound Publications or Mailmax but did not receive the promised supplies or income, can file for a refund online by using a complaint form at www.ftc.gov, the FTC said. Consumers will be required to provide proof they were victims.
- - -
Compiled by Kari L. Dean. Reuters and AP contributed to this report.
