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Tuesday, Jul 23, 2024

Cyberbucks — ‘Love Bug’ Took a Bite Out of Some Companies

PacketVideo Announces

$16.5M in VC Funding

Love hurts, as most of us who own or work on a PC know, especially if it comes with an attachment.

Just how much it hurts is impossible to accurately gauge, but a Carlsbad consulting firm has come up with an estimate on the damages to businesses and public agencies who lost worker productivity May 5 when the “I LOVE YOU” computer virus struck.

Samir Bhavnani, research analyst for Computer Economics, said on the first day the virus was E-mailed, allegedly from a point in the Philippines, it was received by about 47 million PC users worldwide.

By the fifth day, the bug and its many mutations was received by 82.4 million users, Bhavnani said.

The lost productivity from the bug resulted in an estimated $6.7 billion in damages, the company said.

Locally, many companies and governments simply shut down their E-mail servers for at least several hours until new anti-virus software was installed and the offending messages were purged.

“About 15 people opened it but fortunately our IT department caught it early and shut down the E-mail server system. After a few hours it was up again,” said Abe Wischnia of Cubic Corp., the San Diego manufacturer of defense training systems and fare collection transportation systems.

Those firms with international offices, such as Cubic, Jenny Craig, and Solar Turbines, had a big leg up. Solar spokeswoman Wendy Swanson said she wasn’t certain if the alert came from Solar’s parent, Caterpillar Inc., or some other office, but everyone was alerted about the virus, so there was no impact on company operations at all.

Jeanne McDougall, spokeswoman for Jenny Craig, said the firm’s IS department was aware of the problem early, got the message out to everyone and avoided any complications.

Some companies made a point of how well they avoided any serious disruptions.

HNC Software Inc., which makes a variety of anti-fraud software used in the telecommunications, online businesses and the banking and credit card industries, said the firm’s E-mail system PCs may have been down for a few hours, but that was all.

“We have the best computer services department on the globe,” said spokeswoman Melinda Bateman.

John Cloyd, director of information systems for Overland Data Inc., said the virus had very little impact because the company doesn’t use Microsoft’s Exchange or Outlook E-mail products.

“We weren’t at risk because it wouldn’t have hit our architecture,” Cloyd said.

Computer Economics analyst Bhavnani said what made the Love Bug so lethal was its ability to open up a user’s entire address book and send out the same E-mail to each address. It also attached itself to other types of files, such as those used to transmit graphics and music.

Bhavnani said the lesson companies should learn from the Love Bug is to provide more computer training to their employees.

“Companies need to train their workers on prudent work station use,” he said.

Most employees don’t need to receive executable files, and should realize that opening these files up could cause significant harm to network systems if they contain viruses, he said.

– – –

Funding: PacketVideo, a software developer enabling delivery of multimedia over wireless devices, obtained venture capital funding of $16.5 million earlier this month.

The funds were in the pipeline and had nothing to do with the company’s decision last month to delay a planned $64 million initial public offering, the company said.

Don Reckles, a PacketVideo spokesman, said the IPO was delayed because of volatile market conditions.

“The markets are very volatile now and we were not in the need of the money,” he said.

No time was set for a future stock offering.

The latest investment round brings the total equity capital raised by PacketVideo to $41 million since its founding in July 1998.

Companies participating in the recent investment round were Royal Philips Electronics, based in Holland; Sonera, a Finnish wireless service provider; Texas Instruments; and Time Warner.

Funding will be used for working capital, research and development, and supporting engineering, sales and marketing.

Moving On Up: Two San Diego public companies that had been traded on Nasdaq’s small capital trading board moved up to the national board last week.

Mitek Systems Inc., a maker of data recognition software used mostly in the banking and financial services industry, reached some half dozen financial criteria including capitalization and sales, to meet a longtime goal of getting on Nasdaq’s big board.

“By being listed on the national market we’ll be looked at as a bit of a larger company,” said John Thornton, president and CEO of Mitek, which trades under the symbol MITK. “For individual investors, they will be able to better track the company in the newspapers.”

TeraGlobal Communications Corp., a communications technology company, also moved up to the national board and trades under the symbol TGCC.

Send Cyberbucks column items to Allen at mallen@sdbj.com.


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