I.B.M. Moves to Concentrate Power at Top

I.B.M. is reshuffling its top management one level below the chief executive, Samuel J. Palmisano, giving greater responsibility to four senior executives.

The move announced Monday, analysts said, creates a short list for succession. But it could also signal that Mr. Palmisano would be staying on beyond the traditional retirement age of 60 for I.B.M. chief executives. Mr. Palmisano turns 59 later this month.

The reorganization came as I.B.M. reported a solid profit gain in the quarter and raised its forecast slightly for 2010. But the company’s stock fell in after-hours trading amid concern about future revenue and how quickly corporate spending on technology was picking up.

The management changes, announced in an e-mail message to I.B.M. employees, were intended to improve the company’s products and services, Mr. Palmisano wrote. For example, computer hardware and software are for the first time being placed under the oversight of one executive.

Increasingly, Mr. Palmisano wrote, computer systems must be “designed and brought to market as tightly integrated” packages of hardware and software.

“The marketplace has changed,” said Bob Djurdjevic, an independent analyst, “and putting hardware and software under a single executive makes a lot of sense.”

Steven A. Mills, a senior vice president, will be in charge of the hardware and software divisions. But Mr. Mills is 58, and not a likely successor, analysts say.

Mark Loughridge, 57, the chief financial officer, is being given a larger role overseeing finance, the company’s financing unit, and internal information technology. But his experience at I.B.M., analysts suggest, has been too limited to make him a likely successor.

Michael E. Daniels, 56, a senior vice president, will be in charge of the entire services business, which had been split until now. Virginia M. Rometty, 52, a senior vice president, will oversee marketing and strategy, as well as sales, which she handles now.

Mr. Daniels and Ms. Rometty, analysts suggest, would be the most likely internal candidates to succeed Mr. Palmisano.

Still, they say, the closeness in age to Mr. Palmisano of the four executives could well mean that he is planning to remain beyond 60, while giving his top lieutenants large roles. Investors have been pleased with the tenure of Mr. Palmisano who, since 2002, has aggressively expanded I.B.M.’s operations abroad, shifted it sharply into higher-margin businesses and increased earnings per share fourfold.

In its earnings report, I.B.M. reported a profit of $2.61 a share, up about 13 percent from the year-earlier quarter. The profit performance surpassed the $2.58 a share consensus estimate of Wall Street analysts, as compiled by Thomson Reuters.

But I.B.M. reported a sluggish revenue increase of 2 percent, to $23.7 billion, below Wall Street’s forecast of just under $24.2 billion. In the year-earlier quarter, I.B.M. reported revenue of slightly less than $23.3 billion.

New contract signings, the seed corn of future revenue in I.B.M.’s huge services business, also came in well below analysts’ expectations, at $12.3 billion. A. M. Sacconaghi, an analyst at Bernstein Research, had forecast signings of $14 billion.

The revenue shortfall and softness in services signings, Mr. Sacconaghi said, raised doubts about the strength of the recovery in corporate technology spending and how much I.B.M. would benefit. “Investors were expecting more,” he said.

In after-hours trading, shares of I.B.M. fell as much as $5.58, or 4.3 percent.

In a conference call with analysts, Mr. Loughridge, the chief financial officer, expressed confidence for the second half of the year, predicting continued strong earnings gains and an “improving revenue picture.”

I.B.M. raised its earnings forecast for the year to “at least $11.25 a share,” up from $11.20 a share.

Analysts are watching whether companies might trim their earnings forecasts, especially given weakness in Europe and an uncertain American economy.

Mr. Loughridge noted that the strong American dollar shaved revenue in the quarter by $500 million. Services signings, especially on long-term contracts, he said, were often uneven quarter by quarter. And an increase in signings by new customers during the quarter, Mr. Loughridge added, should lead to more new business in the future.

Services revenue rose 2 percent, to $13.7 billion. In the software business, where sales rose 2 percent to $5.3 billion, sales of the company’s Websphere Internet-based software rose 17 percent.

In the hardware division, mainframe revenue declined 24 percent, and sales of large computers running the Unix operating system fell 10 percent. But new mainframe and Unix models are being introduced soon, opening the door to a possible rebound in hardware sales.

I.B.M. is a partial barometer of business investment trends, as the largest supplier of information technology to corporations worldwide. Information technology — computer hardware, software and services — accounts for more than half of all private capital investment.

The technology sector has been leading the recovery, and investors were encouraged last week when Intel, the big chip maker, reported that its revenue rose 34 percent in the second quarter.

I.B.M. is less tied to the cyclical swings of the hardware business than many technology companies. The more stable services and software businesses now account for 80 percent of I.B.M.’s revenue, as the company reduced its dependence on hardware in recent years. As a result, I.B.M. suffered less than many high-technology companies in the recession.

I.B.M., analysts note, focuses mainly on double-digit earnings growth and less on rapid revenue growth. “I.B.M. has had an unrelenting focus on expanding its higher-margin businesses in software and services in recent years, and caring less about revenue growth,” said Carl Claunch, an analyst at Gartner Research.

tech » Policing the Web’s Lurid Precincts

Policing the Web’s Lurid Precincts

Posted by nhamngahanh on 18:03 in tech | 0 comments

Ricky Bess spends eight hours a day in front of a computer near Orlando, Fla., viewing some of the worst depravities harbored on the Internet. He has seen photographs of graphic gang killings, animal abuse and twisted forms of pornography. One recent sighting was a photo of two teenage boys gleefully pointing guns at another boy, who is crying.

At Caleris, Stacey Springer, left, vice president for support operations, reviewing images with Marie Wittry.
An Internet content reviewer, Mr. Bess sifts through photographs that people upload to a big social networking site and keeps the illicit material — and there is plenty of it — from being posted. His is an obscure job that is repeated thousands of times over, from office parks in suburban Florida to outsourcing hubs like the Philippines.

With the rise of Web sites built around material submitted by users, screeners have never been in greater demand. Some Internet firms have tried to get by with software that scans photos for, say, a large area of flesh tones, but nothing is a substitute for a discerning human eye.

The surge in Internet screening services has brought a growing awareness that the jobs can have mental health consequences for the reviewers, some of whom are drawn to the low-paying work by the simple prospect of making money while looking at pornography.

“You have 20-year-old kids who get hired to do content review, and who get excited because they think they are going to see adult porn,” said Hemanshu Nigam, the former chief security officer at MySpace. “They have no idea that some of the despicable and illegal images they will see can haunt them for the rest of their lives.”

David Graham, president of Telecommunications On Demand, the company near Orlando where Mr. Bess works, compared the reviewers to “combat veterans, completely desensitized to all kinds of imagery.” The company’s roughly 50 workers view a combined average of 20 million photos a week.

Mr. Bess insists he is still bothered by the offensive material, and acknowledges the need to turn to the cubicle workers around him for support.

“We help each other through any rough spots we have,” said Mr. Bess, 52, who previously worked in the stockrooms at Wal-Mart and Target.

Last month, an industry group established by Congress recommended that the federal government provide financial incentives for companies to “address the psychological impact on employees of exposure to these disturbing images.”

Mr. Nigam, co-chairman of the group, the Online Safety and Technology Working Group, said global outsourcing firms that moderate content for many large Internet companies do not offer therapeutic care to their workers. The group’s recommendations have been submitted to the National Telecommunications and Information Administration, which advises the White House on digital policy.

Workers at Telecommunications On Demand, who make $8 to $12 an hour, view photos that have been stripped of information about the users who posted them. Rapidly cycling through pages of 300 images each, they are asked to flag material that is obviously pornographic or violent, illegal in a certain country or deemed inappropriate by a specific Web site.

Caleris, an outsourcing company based in West Des Moines, Iowa, says it reviews about 4.5 million images a day. Stacey Springer, its vice president for support operations, says the job is not for everybody and that “people find they can do it, but it is usually a lot harder than they thought.” The company offers counseling as part of its standard benefits package for workers.

Ms. Springer says she believes that content moderators tend to become desensitized to the imagery, making it easier to cope. But she is called on to review the worst material, like sexual images involving children, and says that she finds some of it “hard to walk away from.”

“I do sometimes take it really personally,” she said of the pictures she reviews. “I remind myself, somebody has to do it.”

A common strategy at Web sites is to have users flag questionable content, then hand off material that needs further human review to outsourcing companies that can do so at low cost.

Global outsourcing firms like Infosys Technologies, based in Bangalore, India, and Sykes Enterprises, based in Tampa, Fla., have leapt to offer such services.

Internet companies are reluctant to discuss the particulars of content moderation, since they would rather not draw attention to the unpleasantness that their sites can attract. But people in the outsourcing industry say tech giants like Microsoft, Yahoo and MySpace, a division of the News Corporation, all outsource some amount of content review.

YouTube, a division of Google, is an exception. If a user indicates a video is inappropriate, software scans the image looking for warning signs of clips that are breaking the site’s rules or the law. Flagged videos are then sent for manual review by YouTube-employed content moderators who, because of the nature of the work, are given only yearlong contracts and access to counseling services, according to Victoria Grand, a YouTube spokeswoman.

For its part, Facebook, the dominant social network with more than 500 million members around the world, has relied on its users to flag things like pornography or harassing messages. That material is reviewed by Facebook employees in Palo Alto, Calif., and in Dublin.

Simon Axten, a Facebook spokesman, said the company had tried outsourcing the manual review of photos but had not done so widely.

Outsourcing companies are also reluctant to discuss the business on the record, since their clients demand confidentiality. One executive at a global outsourcing firm, who did not want to be named, said that large Internet firms “are paying millions a year to do this kind of thing and essentially provide some type of control over the beast that is the Internet, which for the most part is uncontrollable.”

“If they don’t do it, their commercial interests will completely die,” he added.

One major outsourcing firm with staff in the Philippines was aware of the risks of this type of work and hired a local psychologist to assess how it was affecting its 500 content moderators. The psychologist, Patricia M. Laperal of Behavioral Dynamics, said she had developed a screening test so the company could evaluate potential employees, and helped its supervisors identify signals that the work was taking a toll on employees.

Ms. Laperal also reached some unsettling conclusions in her interviews with content moderators. She said they were likely to become depressed or angry, have trouble forming relationships and suffer from decreased sexual appetites. Small percentages said they had reacted to unpleasant images by vomiting or crying.

“The images interfere with their thinking processes. It messes up the way you react to your partner,” Ms. Laperal said. “If you work with garbage, you will get dirty.”

Carlos Conde contributed reporting.

Where the Bloggers Are Concentrated

As might be expected, 21- to 35-year-olds now constitute a majority of all bloggers, making up 53.3 percent of that population, according to analysis by the social media consulting firm Sysomos.Bloggers under 21 come in a distant second at 20.2 percent, with the 36 to 50 bracket close behind at 19.4 percent. Only about 7.1 percent of bloggers are over 51.

While age helps define the blogging demographic, gender does not: male and female bloggers are almost equally split.

The United States has nearly one-third of all bloggers, with more than four times that of the next country, Britain. But blogging does not always match up with Twitter use. In another report from Sysomos, Indonesia, for instance, had the sixth most Twitter users, but was not even among the top 15 for blogging representation.

Mobile phones, which can be used for Twitter, are more common in Asia than are Internet connections, said Nilesh Bansal, chief technology officer and co-founder of Sysomos. In addition, he said, “when blogging was booming, back in 2000, 1 percent of the Indonesian population had the Internet and hence they were not part of the blogging revolution.”

In a World of Online News, Burnout Starts Younger

ARLINGTON, Va. — In most newsrooms, the joke would have been obvious.

On Gawker’s “big board,” reporters can check the most-viewed articles, a list updated hourly.
It was April Fools’ Day last year, and Politico’s top two editors sent an e-mail message to their staff advising of a new 5 a.m. start time for all reporters.

“These pre-sunrise hours are often the best time to reach top officials or their aides,” the editors wrote, adding that reporters should try to carve out personal time “if you need it,” in the midafternoon when Internet traffic slows down.

But rather than laugh, more than a few reporters stared at the e-mail message in a panicked state of disbelief.

“There were several people who didn’t think it was a joke. One girl actually cried,” said Anne Schroeder Mullins, who wrote for Politico until May, when she left to start her own public relations firm. “I definitely had people coming up to me asking me if it was true.”

Such is the state of the media business these days: frantic and fatigued. Young journalists who once dreamed of trotting the globe in pursuit of a story are instead shackled to their computers, where they try to eke out a fresh thought or be first to report even the smallest nugget of news — anything that will impress Google algorithms and draw readers their way.

Tracking how many people view articles, and then rewarding — or shaming — writers based on those results has become increasingly common in old and new media newsrooms. The Christian Science Monitor now sends a daily e-mail message to its staff that lists the number of page views for each article on the paper’s Web site that day.

The New York Times, The Washington Post and The Los Angeles Times all display a “most viewed” list on their home pages. Some media outlets, including Bloomberg News and Gawker Media, now pay writers based in part on how many readers click on their articles.

Once only wire-service journalists had their output measured this way. And in a media environment crowded with virtual content farms where no detail is too small to report as long as it was reported there first, Politico stands out for its frenetic pace or, in the euphemism preferred by its editors, “high metabolism.”

The top editors, who rise as early as 4:30 a.m., expect such volume and speed from their reporters because they believe Politico’s very existence depends, in large part, on how quickly it can tell readers something, anything they did not know.

“At a paper, your only real stress point is in the evening when you’re actually sitting there on deadline, trying to file,” said Jim VandeHei, Politico’s executive editor, in an interview from the publication’s offices just across the Potomac River from downtown Washington.

“Now at any point in the day starting at 5 in the morning, there can be that same level of intensity and pressure to get something out.” (Not all reporters are expected to be on their game by dawn, Mr. VandeHei added, noting that many work a traditional 10 a.m. to 7 p.m. newspaper day.)

At Gawker Media’s offices in Manhattan, a flat-screen television mounted on the wall displays the 10 most-viewed articles across all Gawker’s Web sites. The author’s last name, along with the number of page views that hour and over all are prominently shown in real time on the screen, which Gawker has named the “big board.”

“Sometimes one sees writers just standing before it, like early hominids in front of a monolith,” said Nick Denton, Gawker Media’s founder. Mr. Denton said not all writers have warmed to the concept. “But the best exclusives do get rewarded,” he added, noting that bonuses for writers are calculated in part based on page views.

The pace has led to substantial turnover in staff at digital news organizations. Departures at Politico lately have been particularly high, with roughly a dozen reporters leaving in the first half of the year — a big number for a newsroom that has only about 70 reporters and editors. At Gawker, it is not uncommon for editors to stay on the job for just a year.

Physically exhausting assembly-line jobs these are not. But the workloads for many young journalists are heavy enough that signs of strain are evident.

“When my students come back to visit, they carry the exhaustion of a person who’s been working for a decade, not a couple of years,” said Duy Linh Tu, coordinator of the digital media program at the Columbia University Graduate School of Journalism. “I worry about burnout.”

In Washington, the news cycle promises to become even more frenzied as outlets like The Huffington Post expand their operations there. The Atlantic Media Company, which publishes the National Journal and The Atlantic, plans to hire 30 new journalists for a new venture set to open this fall that will publish breaking news and analysis online.

At Politico, Mr. VandeHei, who has been known to pace between rows of reporters’ desks asking who has broken news lately, said editors experimented with monitoring how many articles reporters were writing, but decided that raw numbers did not give a full picture of a reporter’s performance.