Provo Daily Herald | 2000-08-17 | Page 31

BUSINESS ' EDITOR: ANNE GOLDEN 344-256- 2 Dl THE DAILY HERALD (www.HaATheHenldjCotn) THURSDAY, AUGUST 17, 2000 Third quarter results up, but leaders want more and organized the ' sales force under a different By ANNE GOLDEN The Daily Herald Heather Johnson Net sellers 1: of click tax The first time you sell anything over the Internet it is pure pleasure and no responsibility. Tax collectors do not stand over you forcing you to collect state and local sales taxes for the governments where your buyers live. It is a good thing most Internet companies would be overwhelmed by the task of assessing and collecting local sales taxes from the approximately 7,600 tax jurisdictions in the United States. You should be aware, however, that growing Internet sales have forced the issue of local sales tax collection to the forefront. The issue is not really new. Catalogue sales companies have been selling to customers for over a hundred years using the current laws as a guideline. Admittedly, some confusion has resulted. Some companies collect sales tax for only one or two states, a few collect for all jurisdictions and a few don't collect sales tax at all. Without clarification of tax laws, the same result will likely to occur with Internet sales. If the practical difficulties surrounding the enforcement of state and local sales tax collection upon Internet and catalogue sellers are closely examined, the challenge becomes astronomical. To deal with the challenge, the Commission has suggested the creation of a new government agency, the "National Conference of Commissioners on Uniform State Laws," to oversee the simplification of all 7,600 state and local sales taxes. One suggestion advocated by Commission member Governor Mike Leavitt is to contract with "trusted .third parties" who would be responsible for keeping track of the different tax laws in all the jurisidic-tions- , collecting taxes from the Internet and catalogue sellers who sold items in each jurisdiction and dol- uig uui uic voacb bu cwu state or local government. While the creation of this mammoth system was not supported by the Commission at large, it is similar to the method that some large companies have used to pay their taxes: have a large legal team to keep track of everything. The legal standard required by federal law that allows states and localities to collect sales taxes is out-of-sta- te PROVO Novell's third quarter results were slightly improved, but the company still sees room for improvement. "We've been through a costly unintended learning experience," said Novell chairman and CEO Eric Schmidt. In a conference call the Novell corleaders talked Wednesday, porate about aggressive moves they would be taking in the fourth quarter to ignite the company and make it part of a key solution and a major factor in the information traded on the Internet. They feel their sales need to improve. "More effective solutions selling is required here," Raney said. And the company needs to get leaner. "We will take steps in the fourth quarter to further reduce expenses," said Dennis Raney, the senior vice president and chief financial officer. In May, the company announced it would be taking nine months to institute corrective actions. It is that halfway through process now. In the past few months, Novell has reorganized different segments of the company. It also has an aggressive advertising campaign slated for the fall. It has undergone an aggressive training campaign with its sales force In new leader ship reorganized Novell model. sales around new geograNovell has had success phies, solution-sellin- g and with major airlines, govern- channel support. New ments, CNN and other mar- product were groups kets, and foresee more suc- formed to make Novell cess in the future. They more responsive to cushave their sights set on tomers. i markets in education, "In late May we said it and banking. would take upwards of The third quarter report nine months to address followed a disappointing the issues in our business. second quarter report. In the fourth quarter we Novell reported revenue will take additional action of $270 million and earn- to ensure our expenses are ings on a diluted basis of 3 in line with revenue. Our cents per share for its revenue run rate will third fiscal quarter, which enable us to do this withended July 31. During its out impacting investIT third quarter in fiscal ments in our key opportuthe 1999, company report- nities. ed revenue of $327 million "It will also enable us to and earnings on a diluted continue the move of our basis of 14 cents per valued NetWare and share. GroupWise franchises into For the first nine months the Web. We intend these of fiscal 2000, Novell actions to improve the busireported revenue of $888 ness in 2001, as we build million and net income of the value of the Novell $84 million, or 25 cents per brand and accelerate share on a diluted basis. deployment of Novell Net For the similar period in services that support how fiscal 1999, the company business is done on the reported revenue of $928 Net." KEVIN LEEThc Daily Herald million and net income of The also company The Novell tech: Interconnected Logically High Knowledge $117 million, or 33 cents announced that the Novell is control all of center a center monitors that and manages per share. Board of Directors has Novell's world internal network resources wide. and met we computers our authorized the expendi"Although total revenue and earnings ture of up to $500 million objectives for the third in a share repurchase prosolution in assessments collectively quarter, we are nonetheless gram. Ireland. By quarter-end- , represent a business potenNovell will make purNovell was addressing tial of more than 100 mil disappointed by continued weakness of packaged soft- chases of its common stock more than 100 proposals lion users.' ware sales globally, and in open market transacbusiness-to-- ! for and Net Commercial service deployments in con- business and very large especially our poor performtions. ance in Europe," said Novell In the third quarter, new junction with Andersen government deployments chairman and CEO Eric business resulting from Consulting, Cap Gemini, are being assessed worldSchmidt. & Deloitte decisions to make large Touche, wide. "The was quarter deployments marchFIRST and other Anne Golden can be difficult included Toyota NA for a leading consulting systems by impacted s reached at 344 2562 or to global intended integrators. changes Within this group, major agoldenheraldextra.com. network and an emerging improve Novell's business. mid-quarte- r, - business-to-busines- out-of-sta- whether the business has a "substantial nexus" of business activity in that location. A physical presence, such as a store, has been deemed a "substantial' nexus" by the courts, while a remote sale, as happens through a catalogue or via the Internet, has generally not been deemed a "substantial nexus." catalogue and Internet businesses have no physical presence in the state, do not benefit from the infrastructures paid for by the taxes, and have no political representation in the state. The assumption that goods sold by these businesses should carry taxes is an analytical stretch that should be closely examined in the first instance. ' Heather Johnson received her Juris Doctor from the University of Utah and is an Internet law and business at attorney organization in Johnson Law Office Out-of-sta- te American Fork. Recall creates tire shortage nC&DDDg By JUSTIN HYDE demit AP Auto Writer DETROIT 15-inc- WASHINGTON (AP) Movement of work, forced overtime and job stress in Verizon Communications call centers were key issues under discussion in talks Wednesday between the telecommunications giant and striking workers. "We're continuing to talk about these big issues." Candice Johnson, Communications Workers of America spokeswoman The issues remain a stumbling block to a new contract between Verizon jobs to stay at their current and 87,200 workers in 12 locations. CWA and the states and the District of Brotherhood International Columbia. Bruce Gordon, president of Electrical Workers also of retail markets for wish to scale back a proviVerizon, said he considers sion for mandatory overan agreement close at time, which can amount to hand for portions of up to 15 extra hours a Verizon's unionized work, week. The company says the force at some of the call overtime provision is an centers. Eric Rabe, a Verizon answer to the tight labor spokesman, wouldn't say market. Rabe said Wednesday which workers Gordon referred to. The strike by that Verizon is working to workers at Verizon, the complete about 90,000 nation's largest local and pending repairs using and retired wireless phone company, managers workers was expected to enter its filling in for the 12th day " Thursday as strikers. The strike affects direcnegotiators continued to. meet. The company was tory assistance, service and formed by the June mergrepairs in Delaware, Maine, er of Bell Atlantic and Maryland, Massachusetts, New GTE. Hampshire, New New "We're continuing to talk Jersey, York, Rhode about these big issues," said Pennsylvania, Candice Johnson, a spokesIsland, Vermont, Virginia, for and woman the West Virginia Communications Workers Washington, D.C. of America, one of two unions representing the On the Net: Verizon Communications: striking workers. Johnson said workers www.verizon.com fear that Verizon executives Communications Workers of will be rewarded as the America: www.cwa-union.orcompany expands nationalInternational Brotherhood while ly, employees will be forced to of Electrical Workers: move or take www.ibew.org . g rank-and-fi- le lower-payin- Owners of the Firestone tires under recall may have to wait several weeks for replacements because the recall apparently created a h nationwide shortage. The tire industry is rushing to meet the sudden demand for substitutes for the 6.5 million tires recalled by BridgestoneFirestone Inc., but speeding up production will take weeks. "We are taking phone numbers down and calling people back just as quickly as we can," said John Lampe, BridgestoneFirestone exec around the country said they were short of the tires, and some, like 15-inc- h Sanderson Ford in Glendale, Ariz., were completely out. "We've scoured our supply base. We're asking all our suppliers to see if they can supply more," Ford spokesman Mike Vaughn said. "We're looking for tires around the world." John Lampe, executive of vice president BridgestoneFirestone, said Wednesday the company would ship between 325,000 and 350,000 tires this month, and would up production to 500,000 tires a month by January. The company is also authorizing its Firestone stores to use other manufacturers' tires as replacements. But other tire makers don't have large piles of truck tires just lying 15-inc- increase production fold by Oct. 1 for the 15-inc- sizes. has joined Morgan Stanley Dean Witter, the preeminent global financial services firm, . Support Staff also joining Terry are Barbara Christensen, Senior Registered Saled Assistant and Sally Beedy, Sales Assistant Toll Free: Fax: [phone] We Measure Success One Investor At A Time MORGAN STANLEY DEAN WITTER g "Visit us online www.heralde (tTl I fiveh Terry D. Peterson Senior Vice President, Financial Advisor 3550 Noth University Avenue, Suite Provo, UT 84604 mark of Morgan Stanley Dean Witter 4 Co. and services are offered through Dean Witter Reynold! Inc., member SIPC. CI999 Dean Witter Reynolds, Inc. it i tervice h around. Goodyear Tire and Rubber Co. said it hopes to We are please to announce that Morgan Stanley Dean Witter V, utive vice president. The tires installed mainly on Ford Motor Co. vehicles, notably the Ford are Explorer sport utility being investigated by federal safety officials in connection with at least 62 deaths. In many cases, the tread separated from the tire, causing blowouts and rollovers'. Several Ford dealers