For Long, Healthy Prius Life, DIY and Skip Toyota Service

Boston Globe

 

One of the big questions when the Prius came to the North American market in 2000 was, “What’s going to happen when the batteries wear out?”

Well, today we give you Bill Passman, an electrical engineer from Lexington who bought a first-generation Prius in September of 2000 and now has driven it 170,000 miles.

“My experience has been that the car has held up very well,” he says. “Toyota designed it well, and it was warrantied for 10 years or 100,000 miles. I hit the 100,000 miles first, but up until then Toyota took care of everything.”

Everything wasn’t a lot. Oil changes are less frequent than with gas-only cars. “That’s because the electric motor takes care of the initial acceleration, which is toughest on an engine,” says Passman, who changed his “about every 10,000 miles.”

He had the same experience with brakes. “The regeneration system, which uses the car’s momentum to turn the generator that both slows the Prius and recharges the battery pack, means that light braking causes virtually no wear on the normal brake parts,” he explains. He’s done one brake job so far. Instead of a $600 job at the dealership, he had it done at an independent shop, using Toyota parts and just replacing what was worn. Cost: $150.

We like Passman because he’s like many of us, trying to figure out what’s happening with his vehicle before taking it in for service. We also like his license plate, Revolt, one the registry originally refused to issue. When he did get it, he found both front and rear plates mangled after the 9/11 attacks. “Someone didn’t get the pun and recognize a hybrid,” he says.

When his Prius’s small on-board battery failed, he investigated. “It was like a motorcycle battery that ran a lot of the car’s 12-volt accessories,” he says. “The original battery was discontinued, and Toyota wanted $600 to install the replacement and a $150 adaptor cable.”

Instead, Passman tapped into the extensive online Prius community.

“There are groups specializing in each of the four Prius generations,” he says. “For mine, I found folks who had redesigned the armrests, built backup cameras that worked with rearview mirrors, trailer hitches, and warning-light systems to help one drive more economically.”

Passman took a pass on those but jumped in when he found a fellow who’d adapted a Mazda Miata battery and marketed it with a kit containing cables and adaptor block to correct his problem. “I think it cost me $110, including shipping,” he says.

He also invested in an OBD (on board diagnostics) reader. “I got mine at an auto parts store but recently saw one at Costco for about $50,” he explains. “That gave me the error codes. I then checked them online to make sure it wasn’t something serious that required attention at the dealership.”

Recently, Passman’s engine light came on again. The error code pointed to the accelerator, something alarming given the recent Toyota recalls. However, his vehicle wasn’t included in the recall. “Toyota offered to pay 25 percent of the cost, but I could see a $2,000 repair bill for replacing the entire accelerator pedal assembly,” he says. Instead, he checked the code online and got the advice to clean the assembly. “It cost me $5 for a can of throttle-body cleaner, and that fixed my problem.’’

That fixed one problem, but another engine code was left, this one more ominous. It indicated his main battery pack was failing.

“What happens with my generation Prius is that the gasoline engine runs for three to five minutes on startup,” he says. “After that, when the computer said to switch to electric car battery, there would be a surge and then the gas engine would rev up but shift to neutral.”

Passman found that Toyota wanted $3,000 to replace the battery pack. He also could get genuine Toyota parts online (a Generation I battery pack) for about $1,900. The third option was a company called Re-Involt Technologies in North Carolina, which would replace his battery pack with Gen. II batteries for $1,475, plus shipping and an exchange.

He took this option, with the actual replacement being done by an independent shop in Seekonk. Total cost $2,015. “The new batteries are stronger than the original equipment. I averaged 54 miles [per gallon] on the way home,” he says.

What’s next? “I’m looking forward to another 10 years. The car’s still in great shape.”

Tuning Your Fuel Injectors - and Your Fuel Performance

ATV Trail Rider

 

Most ATV manufacturers are increasingly using electronic fuel injection systems. Among the many advantages are better performance, decreased fuel consumption and elimination of the need to modify carburetor injectors according to season or altitude. For those quad riders who want more from their rides and already have dealt with the usual mods (exhaust, air box...), better performance can also be achieved with certain other changes. The subject covered here will concern fuel injection controllers.

There are many products on the market, but specifications and applications can vary greatly. Product choice and price will be affected by your needs and the type of ATV. Certain products are geared for high performance and will necessitate excellent knowledge of fuel injection operation. You will need a computer to reach optimal settings or your local dealer should be equipped to do so. Even with more simple systems, where no computer is necessary, I still recommend installing an Air / Fuel ratio sensor to adjust the controller, in order to avoid damage to your ATV.

In my opinion, a very important factor is the Air / Fuel ratio, since a bad mix can cause considerable motor damage, with overheating, backfiring, difficulties in starting... In other words, whenever considering the purchase of an injection controller, one should plan the acquisition of a wideband Air / Fuel sensor. The Air / Fuel ratio is a measure that analyses the mix of air and fuel, the perfect ratio being 14.7 :1, meaning 14.7 units of air are mixed to one unit of fuel. This balance is not easy to acquire, the important point being to come as close as possible. According to your driving style and your type of vehicle, you can proceed to different adjustments. Certain racers adjust the ratio by either decreasing or increasing the quantity of fuel according to their type of racing. When decreasing the quantity of fuel compared to air, the motor will seem more nervous, more powerful, but will more easily overheat. For those riders into racing or those who like to ride at full throttle for long stretches, the tendency will be to choose a higher amount of fuel compared to air, in order to avoid engine overheating.

Injection systems installed by ATV manufacturers do not allow modifications of fuel demand when you have added performance parts to your vehicle. These aftermarket parts might necessitate a larger demand in fuel.

In other words, an injection controller will allow you to reach a good Air / Fuel ratio and thus obtain higher performance from your ATV after modification. Certain controllers will permit electronic decrease or increase in fuel demand without having to remove any parts on your ATV. It’s like changing the injectors on the carburetor without getting your hands dirty!

All controllers are programmed for a certain type of vehicle, data bases being different. Make sure to purchase the controller that suits your ATV.

How to choose your controller?

For the purists who own ATVs equipped with more aftermarket parts than stock parts and, of course, with a computer, here is a new product offered by Yoshimura, whose reputation for performance is already known. (Photo 1)

The PIM-2 and the Data Box are now available and your injection controller and Air / Fuel ratio sensor can be bought from the same manufacturer. The PIM-2 comes with 400 adjustment points, two basic settings: the first for those equipped with a Yoshimura muffler and the second for those equipped with a complete exhaust system. Different injection curves can be found on the Yoshimura Website, according to the modified parts added to your ATV. The Data Box allows you to set your own Air / Fuel ratio, it will calculate the necessary fuel adjustments for all engine speeds and all positions of the throttle, allowing the desired Air / Fuel ratio. There is no limit to progress! (Photo 2) (Photo 3)

The Dynojet Power Commander V is also a controller designed for those hard-core ATVers bent on modification. This company offers a wide range of products and also proposes an Air / Fuel ratio sensor with a new system called Autotune, which affects adjustments on the controller while you drive. Several curves are available on their internet site according to your type of ATV and your modified parts. In this company’s case, a solid reputation for quality is also well established.(Photo 4)

These two products are designed for those with considerable experience in the preparation of competition engines. The process can be very complicated for the beginner and the projected goal of such an intervention can be difficult to attain.

For those who really want to improve their ATV’s performance, but are less injection system savvy, Dynatek now offers an alternative, which does not necessitate the use of a computer for adjustments. Their injection controller uses three curves of settings based on the level of modifications done to your vehicle. Following installation, all you have to do is adjust the quantity of fuel with a potentiometer for low, medium and high engine speeds. The Dynatek controller allows you to decrease or increase the quantity of fuel to the engine on these three levels independently. (Photo 5)

For some of our readers, modifying their ATV should not be a puzzle and should not entail exorbitant expenses. The Dobeck TFI should suit their needs, being one of the most simple injection controllers. Dobeck proposes a system that allows only the increase in fuel. In my opinion, this type of product is destined to customers with less experience in engine and injection system modification who, nonetheless, wish to improve their rides. Setting suggestions are included with installation instructions. (Photo 6)

We could continue reviewing more controllers as there are many makes and models on the market, but our main objective is to help you in your choice, according to your capacities. So we have decided to play the game and have chosen to go through some testing for your benefit.

In order to do so, we equipped a Suzuki 700 KingQuad with an injection controller and an Air / Fuel ratio sensor. Our test machine has already undergone certain modifications: the exhaust and the air filter are not stuck, the air box has been modified and the clutch system has been redone by our mechanic. Starting with the Air / Fuel sensor, we choose the AFX model from NGK, reputed for the quality of its sparkplugs. The AFX is capable of reading Air / fuel ratios from 9.00 to 16.00 AFR (Air / Fuel Ratio), with a precision degree of 0.1 AFR. Installation requires drilling a hole through the exhaust and welding on the sensor support. This modification must be done by an expert welder, forget the handyman’s torch; this here is more serious business!

Figure a clearance of 4 to 5 inches for the good sized sensor. Once installed, wiring must be run from the sensor reading to the display. Also figure some space for the display wiring, which is quite long since this model is used for racing and for automobile customization. (Photo 7)

NGK provides a threaded nut that will allow you to fill the hole left when the sensor is not in use, as it is recommended not to leave the sensor in place permanently, in order to avoid premature wear. Connection of the display dial goes to the ATV battery and an added switch is necessary (not included). It is not recommended to turn on the sensor without the motor running. We follow all these installation instructions very closely and now we have to find a place to locate the display dial. The support proposed by NGK comes down to a small piece of Velcro of about 2 inches included inside the box. Bear in mind that your dial will come loose on the first bump you hit if you use the model proposed. We choose the Velcro system anyway for simplicity’s sake, but we use a more resistant commercial version. (Photo 8)

Now that our sensor, our dial, and our switch are installed, we are onto the controller. For our test, we chose the Dynatek model, simply because I consider it as a mid- range product, not necessarily lacking in quality, but because  it’s not the most simple, nor the most complicated, just in the middle of both extremes. It will allow us to increase or decrease fuel injection with its three different injection curves, without the need for a computer. Installation of this small housing is done through a few connections, without welding or important disassembly, but of course, it will necessitate certain knowledge of the electrical components of quads. As for all modifications, we recommend dealing with professionals. The controller should be installed within easy reach, which will allow for easy settings without constraints. (Photo 9 and 10)

Ready for a few tests, we first try to set the controller without using the Air / Fuel sensor to verify if its purchase is justifiable. I can confirm to you immédiate, that trying to set the adjustment of the Air / Fuel ratio by trial and error is almost impossible; how do you know if your settings are exact? Furthermore, you are risking damage to your ATV engine. In order to insure that no damage is done to our KingQuad’s motor because of overheating, we added a heat sensor with a dial placed just below the 12 Volt outlet on the front right fender, a small low cost addition (approximately $60) to verify that the KingQuad’s engine remains at the right temperature. (Photo 11 et 12)

After hours devoted to testing dozens of settings, we come to the conclusion that the Air / Fuel sensor is indispensable, if your controller is to be adjusted for good performance. I now understand why Yoshirama or Dynojet include this indispensable part in their catalogue. The sensor dial allows us to visualize whether the ratio is right. The ideal setting is between 12.5 and 13 AFR and even with this tool, the manipulation of the controller potentiometers was very touchy, since only a slight change in the position of any potentiometer will affect the ratio of the motor speed it controls.

Now here comes my favorite part of ATV modifications, on track testing! I met with Alain, our editor-in-chief on a Sunday morning for a good coffee and a fine joyride. This long awaited day is not the best weather wise, it’s raining, it’s dark out and it’s cold! But the whims of Mother Nature will not stop 2 thrill seekers such as we are. The 12 kilometer circuit where our testing occurs is beckoning us. After warming our engines, we decide to push the King a little harder. Honestly, the difference felt from the controller appears more evident at low and medium engine speeds, the engine pickups on the KingQuad are superior and we experienced no difficulty in sliding the rear just by pushing the throttle in turns. A small thrust on the throttle just before a bump will send you flying over on the back wheels without difficulty. There is so much water that we have trouble keeping our protection goggles on, water is even seeping all the way to my ears despite my helmet, but we keep on going relentlessly. I keep on checking my Air / Fuel ratio as often as possible and, to my great surprise, in spite of all this water, it still keeps on functioning properly. NGK claims the instrument resists splashing, but is not waterproof.

In short, an injection controller and an Air/ Fuel sensor are 2 necessary parts for modifying an electronic fuel injected ATV, but bear in mind that the cost of the set will be quite high, say anywhere between $500 and $800, something to consider!

Siemens Confessing to Bribes Proves Blessing to Shareholders in CFO's View

Bloomberg 

 

Joe Kaeser was six months into his new job as chief financial officer of Siemens AG in November 2006, and already, he had a list of accomplishments to show for it.

The executive had helped to arrange a joint venture between Siemens and Nokia Oyj that combined their telecommunications- network units, guided Siemens in completing its largest U.S. bond offering and converted the company’s financial statements to international standards.

What Kaeser, 52, a Siemens employee for his whole working life, didn’t know was that he was about to face his toughest challenge yet, Bloomberg Markets reports in its May 2010 issue. On Nov. 15, 2006, police raided Munich-based Siemens’s corporate offices as part of a probe into alleged bribery and kickbacks that would eventually spread to 12 countries. Chief Executive Officer Klaus Kleinfeld stepped down in 2007 after the company’s board indicated it wouldn’t renew his contract. He wasn’t charged with wrongdoing.

Siemens, a manufacturing bellwether whose products range from power turbines to medical scanners and whose operations span the globe, ended up pleading guilty to violating provisions of the U.S. Foreign Corrupt Practices Act and paying $1.6 billion in fines to U.S. and German regulators.

‘Dark Chapter’

Kaeser was never charged with wrongdoing. As a member of Siemens’s management, he was initially under suspicion, he says. After an independent investigation conducted on behalf of the Siemens audit committee found he had no involvement in the scheme, he was able to help review and fix the company’s books going back to 1999.

“That was quite a rough time,” Kaeser said in a Feb. 9 interview at the company’s New York office.

“It was a very dark chapter of Siemens history,” he says. “Looking back now, I probably would feel compelled to say it was a blessing for Siemens that it got caught then and that this company had the opportunity and the chance to turn everything around and close that one for good.”

Shareholders approved a settlement between the company and nine former executives in connection with the probe in January. Under the deal, the executives, including former CEO Kleinfeld, would pay the company damages for failing to halt a culture of using bribes in order to win contracts, largely ending the ordeal for Siemens. Two former managers are scheduled to stand trial in a Munich court next week over allegations of breach of trust and aiding bribery.

Kaeser’s challenge now is to bolster profits at the company as the global economy recovers from the worst recession since the Great Depression.

Revamp Under Loescher

Bavarian-born Kaeser, who joined Siemens in 1980 in the company’s components group, works closely with CEO Peter Loescher, a former Merck & Co. manager who became the first outsider to head Siemens when he was hired in 2007 following Kleinfeld’s departure. Loescher, 52, changed Siemens’s structure to focus on three main divisions -- industrial, health care and energy -- and replaced half of the company’s top 100 executives.

The restructuring reduced costs, enabling the company to increase so-called sector profit, or pretax operating earnings, at the three units in fiscal 2009, although revenue and orders fell amid the downturn. “That actually would suggest that the moment our business recovers and grows, we will get a lot of incremental margin dropping to the bottom line,” Kaeser says.

Siemens’ shares have benefited as the cost-cutting moves helped to bolster profits. The company’s stock climbed 71 percent in the 12 months ended April 7 to 75.06 euros, outpacing the 44 percent gain in Germany’s DAX index in the same period.

Signs of Recovery

Kaeser says he’s uncertain about when a sustained recovery will take place, particularly in manufacturing. “There are signs of hope, but there is no consistent picture of what the industrial world will do going forward,” he says.

Siemens executives were similarly cautious even after announcing that profits exceeded analysts’ expectations for the first three months of fiscal 2010. The company affirmed its guidance for sector profit from the three main divisions of 6 billion euros ($8.2 billion) to 6.5 billion euros for the full fiscal year, which will end on Sept. 30.

Kaeser said in February that Siemens may revise its profit targets when it releases results for the second quarter, at which time the outlook for the company’s industrial businesses may be clearer. He says Siemens expected to learn more about customer demand at the Hannover Messe, an international trade fair being held in Hanover, Germany, from April 19-23.

“We do expect that we’ll get a lot of insight on what our important customers are going to do, are going to intend in the next 12 to 18 months,” Kaeser says. Siemens will announce its earnings for the March quarter on April 29.

Return to Growth

Even if demand picks up this year, Kaeser says it’s unlikely that revenue will return to pre-recession levels anytime soon. “Our viewpoint of our global business is that it takes years until we are back up at levels of 2008, where we came from -- probably 2011, if not 2012,” he says.

When growth does resume, Kaeser says, the geographical mix will be different, driven by demand from China, India and Brazil rather than Europe and the U.S., as in the past. Siemens is addressing this changing reality by reviewing its operations and workforce.

In January, Siemens announced about 2,000 job cuts in Germany, where it started its business 163 years ago.

“This is in the industrial area, drive technologies as well as industrial solutions, where we know that it ain’t coming back,” Kaeser says. “And if it comes back, it’s going to be in India or China.”

More Cuts

Siemens in March said it would eliminate an additional 4,200 positions at its SIS computer-services division. The reductions come on top of more than 20,000 job cuts last year, which trimmed the company’s global head count to about 402,000. A third of that total is in Germany.

Kaeser says Loescher’s changes in 2007 helped the company weather the downturn but that long-held policies also played a part. These include never using short-term financing to fund long-term assets, a strategy that shielded the company when money markets froze in 2008. Most of its 15.8 billion euros of long-term debt matures in 2014 and beyond, according to data compiled by Bloomberg.

“We’ve always been extremely stable and rigid on that matter, and it paid off massively,” Kaeser says.

Euro Zone

Siemens has no bonds due this year. In 2011, two issues totaling 3.55 billion euros will mature, according to Bloomberg data.

Kaeser also credits European monetary union with helping to keep the region together during the financial crisis.

“I feel very positive about it because if you hadn’t had the euro in the last 18 to 24 months, it would have been a big challenge for European leaders to keep everyone together,” he says.

With credit markets now stable, Kaeser says the company may choose to refinance some debt this year while rates are low rather than risk a rise in borrowing costs in 2011. “I don’t want to be caught flat-footed a year from now with fiscal or monetary actions that negatively affect our company,” he says.

Laptop Battery Power Tips

PC World

In some respects, life as a laptop-carrying frequent flyer has gotten a little easier. Exhibit A: Though far from commonplace, it's not freakishly bizarre anymore to find a power port at your airplane seat--even in coach. Virgin America and American Airlines are among the most generous airlines in terms of supplying power ports to passengers.

But it's still way too easy to run out of juice in flight, or during the course of a long day away from a wall socket. Here are some tips for keeping your laptop running as long as possible when you're on the go.
 

Ditch the Peripherals, Tweak Settings

When you're on the road, you can significantly conserve battery power by dimming your laptop screen's brightness. Make sure there are no CDs or DVDs sitting in your optical drive, and don't connect any USB peripherals--all power hogs. Turn off Bluetooth, Wi-Fi, and 3G networking (you have to do that in flight anyhow).

Also, tweak your laptop's power settings to conserve your battery. For example, in Windows Vista, go to Control Panel, Power Options and select the "Power saver" setting You can adjust the "Power saver" settings, if you want, or create your own power plan.
 

Buy a Second Battery

Many laptops today can run off two batteries. When the juice from the primary battery runs dry, the auxiliary kicks in. In most cases, the primary battery comes with the laptop; the second is an optional purchase. For example, HP's EliteBook 6930p promises up to 24 hours of use from one charge--but only if you attach an optional, external 12-cell ultra-capacity battery pack ($189) as a secondary battery to augment the laptop's internal, primary six-cell battery (There are other requirements, too, such as the need to downgrade to Windows XP.) Keep in mind that second battery packs, sometimes also called battery slices often add bulk and weight to your laptop.

Another option: Buy a portable battery pack. I like the Duracell Powersource Mobile 100 (about $110 and up online) because it lets you power a variety of devices, such as laptops, cell phones, portable DVD players, and video cameras, using their own power cords. By comparison, some portable power rechargers require special tips or cables to recharge your gear. The Duracell Powersource can also recharge two USB devices simultaneously with your laptop.
 

Get to Know Battery Specs

When buying a new laptop or a second laptop battery, pay attention to the power specs. Generally speaking, you need to know how many cells the battery has. The more cells, the longer the battery can last on a charge. For example, a 12-cell battery is designed to last much longer than a six-cell battery. Alternatively, the specs might list Watt-Hour rating, or WHr. The higher the number, the longer your battery should last. Some computer makers, such as Apple, describe laptop batteries in terms of WHr, while others use cells.
 

Check for Power Ports Before You Fly

Before I book a flight, I find out the type of aircraft I'll be on. Then I jump over to Seatguru.com, which offers helpful seating configuration maps for most domestic and international airlines. The black dots on seat maps indicate the presence of in-seat power ports. Keep in mind, though, that sometimes (especially in coach) you may have to share one power port with your neighbor.
Play Your Music on a Portable Player

Playing music or videos on your laptop is a great way to pass the time--and drain your laptop comupter batteries. Music and audio files make frequent hits on your hard drive, which consumes battery power. If you need to work during a long flight, and yet you want to silence that crying baby in 12B, listen to music on your portable media player. That way you won't tax your laptop battery. Most airplanes today have an in-flight music system, which you can listen to even during take-off and landings (which you can't do with a portable electronic device).
 

Watch Videos on Your Hard Drive

Playing a video on a laptop's DVD drive eats laptop battery power. Video playback from a hard drive, however, is less taxing. So for your next long flight, consider downloading a few movies or TV shows to your hard drive. Or convert your own DVDs into files you can play off your hard drive. As PCWorld.com blogger Rick Broida points out, you can use the popular open-source program Handbrake to rip DVDs into files for watching on a laptop or iPod/iPhone.
 

Share an Airport Power Plug

Have you ever tried to find an available wall socket at an airport departure gate? Most of the time, other people have already taken the few existing wall sockets. That's why I travel with a multi-plug power adapter. Example: Kensington's Portable Power Outlet ($21 on Amazon.com) lets you simultaneously plug up to three devices into one wall outlet. It also lets you charge up to two USB devices at the same time, and it offers surge protection. Belkin makes a similar product, the Mini Surge Protector With USB Charger (about $14 or more online).

Mobile Computing News, Reviews, & Tips

Netbook/Tablet With Long Battery Life: A company called Always Innovating claims its forthcoming Touch Book netbook transforms into a tablet PC when you pull the screen away from the keyboard. The company also says the netbook's batteries will go for up to 15 hours on one charge. It's expected to be available in May or June for $299 (without a keyboard) and $399.

Sprint Announces Palm Pre Pricing: No word yet on when the Palm Pre smartphone will ship, or what its price tag will be. But details of Sprint's pricing plans for the phone are emerging. Individuals can choose between 450 minutes ($70), 900 minutes ($90) or unlimited plans ($100).

Apple's iPod Shuffle Gets Vocal: The third-generation iPod Shuffle ($80) is tiny. It's so tiny it has no buttons, knobs, or screen (though previous Shuffles lacked screens, too). Instead, the new MP3 player offers VoiceOver, a text-to-voice feature that reads off song titles, artists, playlist names, and so forth. In addition, the earbuds included with the Shuffle feature in-line controls such as volume up/down.

Verizon Announces VoIP Packages for SMBs

Network World

 

At the recent Comptel Spring 2010 conference, Verizon Global Wholesale Division announced plans for three new VoIP phones and Internet packages designed for retail service providers to offer to small and midsize businesses. The wholesale offers will be accompanied by marketing efforts to SMBs.

The first package combines Verizon's Session Initiation Protocol (SIP) Gateway Service with new a NEC Univerge SV8100 IP PBX that is offered with an associated installation and maintenance bundle. Both the SIP connection and the NEC PBX are offered at a discount, although the service and hardware discounts expire on June 30.

The second package, designed for 30 or more users, is an Internet T1 dedicated circuit service that also combines service and hardware. The equipment offered in this package is either a Samsung Ubigate iBG 1000 for data-only applications or a model 1003 for data and voice services combined. Like the first offer, the package is offered at a discount, which expires at the end of March 2011. QOS assurance is offered as an option for an additional charge.

A third package offers customers a Samsung iBG1000 bundled with an Ethernet connection at either 5Mbps or 10 Mbps. The cost of the router is credited back to the customer over the first year of service, and the Ethernet connection is discounted with the promotional offer, which expires on at the end of March 2011.

Commenting in a statement on the new bundles, Quintin Lew, senior vice president of marketing for Verizon Global Wholesale said, "By creating new home and business VoIP services and Internet packages that include both services and hardware, we're giving our wholesale customers new ways to support their small- and medium-sized business customers in a time when every nickel and every efficiency counts toward success. Our goal continues to be to arm our wholesale customers with the tools that help them to help small and medium-sized businesses succeed."

Business Software Maker CA to Cut 1,000 Jobs

Associated Press

Business software company CA Inc. said Tuesday that it's cutting 1,000 jobs - or about 8 percent of its work force - and consolidating offices as part of a restructuring plan to reduce costs and become more efficient.

The company also steered earnings expectations to the lower end of its previous guidance for the year.

"I recognize that the actions we're taking are difficult. But in the end, they will make CA stronger and more competitive," CEO Bill McCracken said in a memo to employees Tuesday.

The job cuts will occur mainly in North America and mostly be completed by the end of September, according to a filing with the Securities and Exchange Commission.

The Islandia, N.Y., company has already shed 3,100 positions over the last three years amid office closings.

The reductions are part of CA's efforts to mold the company to better fit its new business strategy of focusing on emerging technologies, high-growth markets, and task management software. A key area of interest is cloud computing, where it would handle software and data storage for corporate clients off-site.

"We are taking the necessary steps to further align our organizations and skills with CA's strategy," McCracken said. "The industry and the market are changing, and we have to change, too."

CA will be consolidating an unspecified number of offices, which could include closings, reductions in office space and merging of locations.

The company expects to incur a $50 million pre-tax charge in the fourth quarter, of which $47 million would be for severance payments and the rest related to facility consolidations.

CA also said full-year earnings will come in at the lower end of the range it had previously given. It expected to earn $1.60 per share to $1.71 per share for the year, excluding one-time items. Analysts polled by Thomson Reuters were expecting $1.69 per share, on average.

Firms Jockey for Space in Tech Services

The Wall Street Journal

Big Competitors Join Increasingly Crowded Market as New-Deal Spending Slows

 Michael Dell, left, and Ross Perot Sr. Dell bought Perot Systems in 2009.

 

 

Hewlett-Packard Co., Dell Inc. and Xerox Corp. are seeking new profits in the technology-services industry. But those companies face a major challenge: While competition is intensifying, their corporate clients are spending less on new deals.

Over the past two years, H-P, Dell and Xerox have spent billions to muscle their way into better positions in tech services. The market, traditionally led by International Business Machines Co., is regarded as attractive because it provides steady revenue from customers who pay recurring amounts to outsource their tech systems like email or payroll.

But even as the total number of new services contracts awarded each year more than doubled globally between 2000 and 2009, the amount spent on those new contracts fell to $74.5 billion from $90 billion in the same period, according to tech-consulting firm TPI. The market is expected to remain tight even amid a recovering economy.

Behind the slowing growth are companies like Dow Chemical Co. that are signing smaller, shorter-term tech-services contracts. In 2000, Dow Chemical signed a seven-year deal to outsource parts of its information-technology systems to IBM. Last year, it signed a new services deal with IBM for just five years. IBM and Dow Chemical declined to disclose the dollar values of the deals.

"From a buyer point of view, you always want smaller contracts," says Dave Kepler, Dow Chemical's head of IT. Dave Liederbach, general manager of IBM's strategic outsourcing division, acknowledges that "the deal size, on average, is going down."

Industrywide, "we're increasing the number of deals, but revenue isn't increasing at the same rate," says Tom Blodgett, head of corporate tech services for Xerox, which last year acquired services provider Affiliated Computer Services Inc. for $6.4 billion.

The declining growth started last decade, says Don Mann, who heads Dell's services unit for large businesses. "The deals kept getting smaller and smaller and smaller," he says. In the past, it was common for large companies to sign 10-year outsourcing agreements with tech-services providers like IBM.

But a growing number of players in the services market, including low-cost Indian competitors like Infosys Technologies Ltd., have made the market more competitive and given customers more leverage, says TPI vice president Mike Slavin. That's allowed customers to grab smaller, cheaper deals that can be frequently renegotiated.

Such dynamics haven't dissuaded tech giants from investing in tech services. Dell last year bought Perot Systems Corp., which specializes in public-sector tech services, for $3.9 billion—a 68% premium over Perot's share price at the time the deal was reached. H-P spent more than $13 billion to purchase Electronic Data Systems. The wave of acquisitions came as profits fell in areas like computer hardware and printers.

Since the services industry has no one dominant player—IBM had less than 8% of the total market by revenue in 2008, the last year for which data are available, according to market-research firm Gartner—the big tech companies saw an opportunity to grow, says TPI's Mr. Slavin. They also saw services as a way of developing new customers who would buy computers, he adds.

In response to the slowing growth, H-P, IBM, Dell and others are also trying to cut costs by creating new software, developing niche specialties in areas like health care, and shifting to employees in lower-cost countries like India. IBM, Mr. Liederbach says, has been sending research scientists to develop new software with companies like Dow and now bids for smaller, short-term contracts with customers in the hopes of securing larger ones in coming years.

Dell's Mr. Mann says his company has created new offerings for health-care customers, which stand to receive more than $19 billion in federal funding to computerize patients' records, enhancing health care seo. Xerox's Mr. Blodgett says his company is focusing on outsourcing specific functions, like employee benefits, which ACS started managing for Ford Motor Company last year.

Still, customers such as General Motors Co. appear to have the upper hand. GM, which at one point owned EDS, played a big role in the move toward smaller contracts when it changed its outsourcing strategy in 2006. Until that year, GM outsourced almost all its technology to EDS, but in 2006 sought bids from other providers to get away from giant, single-vendor contracts. GM awarded a $700 million contract to H-P (which had not yet purchased EDS) for certain systems and also outsourced pieces of its IT to IBM and Wipro Technologies Ltd.

EDS said in 2006 that it still expected to get about $1.2 billion a year from GM, though it only had 70% of the outsourcing work, rather than close to 100% as it had in years past. A GM spokesman declined to comment. An H-P spokeswoman said the company still does work for GM.