Yahoo Data Center Planned for New York

from the Wall Street Journal:

>>ALBANY, N.Y. -- State officials are working with Internet giant Yahoo Inc. to establish a data center in Western New York.

The center would house computer systems and other equipment. State officials say it wouldn't result in many jobs, but the symbolism of luring the big-name company could help with other economic development efforts.

Statement from Equinix on the Passing of Co-Founder Al Avery

FOSTER CITY, CA – May 5, 2009 –

It is with sadness that Equinix announces that Al Avery, one of the co-founders of Equinix, has passed away. Al, who retired from Equinix in 2003, had been diagnosed with pulmonary fibrosis and had recently received a lung transplant. He battled this illness valiantly, but passed on peacefully earlier this week with family at his side.

Al and Jay Adelson started Equinix in 1998 when they worked together as facilities managers at Digital Equipment Corporation (DEC), where they developed the idea for a Neutral Internet Exchange (NIX) to create a physical place for networks to exchange critical information. Their critical work helped the Internet grow and today, the company Al helped build is the home to the mission-critical infrastructure of over 2,300 customers, many of which are vital to the information-driven world. Equinix has Al's legacy to thank.

A memorial service will be held at a later date. Donations can be made in Al's name to the Pulmonary Fibrosis Foundation.

Rotary UPS failure at Quality Tech - again: Who are the heroes and villains?

from Tier 1 Research Daily newsletter:

T1R was dismayed to hear about a second HiTec CPS (rotary UPS)-related outage at Quality Technology Services' Suwannee, Georgia facility. Approximately one quarter of that 175,000-square-foot datacenter had experienced a brief interruption in power on February 14 that was ultimately traced to the control logic for their HiTec CPS systems. .....

----

Why internap related?

Conflict of interest disclosure: I work for the following company. I don't normally self-promote, but a mutual friend asked me on Jabber to respond. He's free to identify himself, but I don't name-drop without permission.

Internap (http://www.internap.com/product/datacenter/colo/page1510.html) (the link is to the colo information page) is headquartered in Atlanta, and has three datacenters in the area: at its HQ downtown near Peachtree Center; at 56 Marietta; and in Suwanee.

---

from Seeking Alpha transcripts, 1 Q 2008

James DeBlasio

Yeah that was about a $900,000 equipment sale Colby that we had with QTS in the third quarter and we did call it out in our earnings script and our prepared remarks in the fourth quarter and it was part of the larger QTS deal that we had as you know that’s $15 million over five years -- over three years rather and last year in addition to the normal IP and CDN related traffic, QTS asked us to provide some third party equipment to build up one of their data centers which we did and called it out as such in the fourth quarter.

---

Report: Quality Technology Services

Quality Technology Services QTS Quality Tech Datacenter Massive outages all the time - up and down daily with super high prives Suwanee Georgia

Quality Tech DataCenter 300 Satellite Blvd. NW
Suwanee, Georgia, 30024
U.S.A.

Internap c.c. highlights

Transcripts from Seeking Alpha. Comments in Italic, emphasis added:

>>Internap Network Services Corporation Q1 2009 Earnings Call Transcript

Eric Cooney

Our IP and CDN businesses continued to underperform showing year-over-year and sequential declines in revenue and segment gross margins. Overall, we are disappointed with our second consecutive quarter of declining revenue and adjusted EBITDA. We are implementing a number of actions, one of which was the cost reduction plan we announced on March 31^st, which we believe will help to reverse these trends.

The third observation I would like to mention is that in recent history, we may have sacrificed profit margins in pursuit of revenue growth. Simply stated, not all business is good business.

The need for us to strengthen the core is probably obvious given the recent financial performance. But I think it is made even more apparent when we consider that there are competitors in each of our target markets who are outperforming Internap today.

However to give you a sense for the types of initiatives, I will mention a few specifics including simplifying the customer billing, optimizing the sales process, refining customer service performance metrics and streamlining our partnerships to focus on fewer mutually beneficial partnerships. (less third party data centers?)

George Kilguss

Cash operating expenses which exclude segment direct cost, depreciation, amortization, stock-based compensation and restructuring charges totaled $23.6 million in the quarter compared to $21.1 million of cash operating expense in the first quarter of 2008 and include approximately $1.4 million of cash CEO transition costs in the quarter.

On a combined basis, total IP and CDN traffic was up 25% from the same period a year ago, but flat sequentially as traffic from two large volume IP customers we churned last quarter was replaced in Q1. Customers had purchased more than one service offering from us in the quarter increased to 45.2% of total, up from 42.5% last quarter and 35% a year ago.

Eric Cooney

For CDN, I think you all probably know the history of at least as well as I do at this point. But on neither of those fronts, technology nor customer service have we yet successfully differentiated ourselves. So the answer to how we stabilize it is, well, we get to first to market with best-in-class technology based on some products we expect to launch here in the second half of this year.

I think in terms of guidance, specifically with regard to CapEx, our intention will be to come back and give let’s say more visibility specifically around our CapEx spend expectations. The short answer right now, we’re not providing that frankly because we are going through as we speak an evaluation of exactly that. What sort of CapEx investments we want to make particularly around datacenter footprint to simply put ensure we can continue to do to drive profitable growth in the datacenter segment? So as we refine that CapEx spend, we will definitely give some further guidance, some further color to the market in terms of 2009 spend. (already late to the party, still evaluating further colo expansion...)

And as far as I am concerned on a go-forward basis, we need to be able to deliver a profitable growth in each of those businesses, let’s say on to itself, i.e., not dependent on subsidizing our let’s say CDN business based on success in IP or fare slightly differently. If we don’t have a compelling customer value proposition for customers to buy CDN, then we shouldn’t be in the CDN business. And if that answers your question in terms of let’s say the bundle. (farewell bundle and may be CDN...)

From our perspective, the ability to sell a continuing or an expanding set of products and services to our enterprise customer base is of course one of the ways we will grow the business. So I think maybe more your question is, is the bundle “a particular perceived customer benefit”, are we selling more CDN because we are able to offer all three and that’s what I am saying, I’m at least at this stage less convinced that the bundle is in and of itself a compelling customer value proposition. I think the bundle is really just more a useful metric for yourselves and for us to judge our success in selling more products or selling an expanded set of products to our target customer base, if that makes sense.

Colby Synesael – Kaufman Brothers

And then my next question, really the 45% number that you guys mentioned, it continues to go up each quarter. How much of that is it related to – in terms of bundling, how much of that is related you guys actually selling to more customers and more services versus you’re just seeing more of your single customers churning out and therefore the math is just bringing that number up? Thanks.

George Kilguss

In regard to your question on bundling, the answer is it’s a little bit of both. We still do see our bundle percentages increasing and we see them increasing in the individual segments. But you are correct, there’s a little bit of math that does drive the number north. (colo customers, who are sticky, stay and drive this number up. Other customers, especially CDN, just leave and never take additional services...)

Auriga Initiates Coverage on Equinix (EQIX) with a Hold

from StreetInsider.com:

>>Auriga Initiates Coverage on Equinix (EQIX) with a Hold

Auriga initiates coverage on Equinix (Nasdaq: EQIX) with a Hold. Price target $77.

Auriga analyst says, "EQIX is a well-managed company and the leading pure-play vendor in data center services, one of the hottest secular growth stories in technology. We are also confident EQIX will exceed Street EBITDA expectations in 2009-10 and thus see some upside potential for the stock. That said, EQIX has had a big run and we question how much additional multiple expansion the company might see in the near-to-medium term."

"Market Trends Still Healthy. Data center services are continuing to benefit from greater computing complexity, broadband proliferation, IT outsourcing, and higher end-market demand for more intensive bandwidth services. Moreover, sector supply/demand characteristics remain favorable. While EQIX is certainly not immune to the economic recession, we do not expect to see a material weakening in demand this year."

Direct Edge to convert to stock exchange status

from Finextra.com:

>>Direct Edge to convert to stock exchange status

US stock trading venue Direct Edge has filed applications with the Securities and Exchange Commmission to convert into two national securities exchanges later this year.

The broker-backed venue has filed two Form 1 applications with the SEC in order to register its ECN trading systems, EDGX and EDGA, as facilities of two newly-created national securities exchanges.

Direct Edge broke the ten per cent threshold for matched market share in US stock trading last month for the first time, and now claims to be the third-largest stock market operator in the world.

In a letter to stakeholders, CEO William O'Brien projects that the transition to exchange status will coincide with the launch of the firm's next-generation technology platform from a new Equinix "NY4" facility in Secaucus, New Jersey.

He says: "We currently anticipate user acceptance testing to begin in the 3rd quarter of 2009, with a launch date in the 4th quarter, pending SEC approval of our applications."

transit across the Internet was exceptionally slow

from Computerworld.com:

Debugging the Interwebs

"At 8:30pm PDT I noticed that transit across the Internet was exceptionally slow. A look at Keynote reported problems between Cogent, Internap, XO and others with packet loss between 3.5% and 6%. By 9 p.m. the problem had gotten worse with Savvis and Qwest reporting similar loss percentages. At 2 a.m. Friday (I happened to wake up and thought I'd check) Internap and Qwest are reporting 6.5% packet loss.

Internap 10-Q highlights

Internap 10-Q highlights

Restructuring and Impairments

On March 31, 2009, we announced that we reduced our workforce by 45 employees, representing 10% of our total workforce. The reductions were primarily in back-office staff functions and included the elimination of certain senior management positions. We expect the total estimated costs associated with the restructuring to be approximately $1.2 million, of which we recorded $0.9 million during the three months ended March 31, 2009. We expect to incur all remaining charges by June 30, 2009. These costs relate primarily to non-recurring severance payments. Substantially all of these charges consist of cash expenditures.

We have experienced declines in our IP services and CDN services operating results during the three months ended March 31, 2009 as compared to March 31, 2008 and our projections. However, we have concluded that no impairment indicators exist to cause us to re-assess goodwill during or immediately following the three months ended March 31, 2009.

Stock-Based Compensation and Executive Transition

On January 29, 2009, we announced the appointment of J. Eric Cooney as our president and Chief Executive Officer and a member of our board of directors effective March 16, 2009. Mr. Cooney succeeded James P. DeBlasio, who resigned as President and Chief Executive Officer effective as of March 16, 2009 and as a director effective as of March 15, 2009. In connection with his employment, Mr. Cooney will receive (1) an annual base salary of $600,000, (2) a cash signing bonus of $300,000 (under certain circumstances, Mr. Cooney will be obligated to reimburse us for $150,000 of the signing bonus if his employment terminates prior to March 1, 2011), (3) an option to purchase 600,000 shares of our common stock at a purchase price of $2.24, the closing price on the day of commencement of work, 25% of which will vest on the first anniversary of the grant date and the remainder to vest in 36 equal monthly installments thereafter, (4) a new hire grant of 300,000 shares of restricted stock, which will vest in four equal annual installments, (5) a grant of 200,000 shares of restricted stock on each of the first anniversary and the second anniversary of his commencement of work, both such grants to vest in four equal annual installments, (6) an annual incentive bonus based upon criteria established by our Board of Directors, with a target level of 100% of base salary and a maximum level of 200% of base salary and (7) customary benefits including vacation. The agreement provides for “at will” employment. The fair value of Mr. Cooney’s stock-based compensation awards is $2.4 million, including the shares that may be issued on the first and second anniversaries of the commencement of work.

Pursuant to the terms of a separation agreement with Mr. DeBlasio, he received (1) a cash payment of $927,000, one half of which was paid in March 2009 with the remainder recorded as a liability in the accompanying financial statements to be paid in September 2009, (2) full vesting of all equity awards previously granted to him as of March 16, 2009 having an incremental value of $0.8 million and (3) if he so elects, continued health, dental and vision insurance coverage under our group health plan until September 16, 2010. Mr. DeBlasio has until March 16, 2010 to exercise any stock options that were vested as of March 16, 2009.

----

During the three months ended March 31, 2009, we changed our method of counting customers. Under the previous approach, we counted (1) customers who we invoiced for at least one full month in the quarter, (2) customers who purchased our FCP product, which typically has a large non-recurring component and (3) new customers in the quarter who had signed contracts even though we had not yet invoiced them. Under our new method, we count only recurring-revenue customers who maintain service during the final month of each quarter, thereby excluding new customers acquired in the quarter that have not yet been invoiced and customers purchasing only FCP products. This change provides us and our stockholders more relevant information.

We currently have 3,174 customers, serving a variety of industries, including entertainment and media, financial services, healthcare, travel, e-commerce, retail and technology. Our customer count is summarized in the following table:

		Number of Customers
March 31, 2009		3,174
December 31, 2008		3,311
September 30, 2008		3,375
June 30, 2008		3,433
March 31, 2008		3,414

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We are currently in a time of severe deteriorating economic conditions and have seen signs of slowdowns and cautious behavior from our customers. We are continuing to monitor and review our performance and operations in light of the continuing negative global economic conditions. In particular, we continue to analyze our business to control our costs, especially through making process enhancements and renegotiating network contracts for more favorable pricing and terms. In addition, if operating results deteriorate or do not improve, and/or if unfavorable changes continue to occur in other economic factors used to estimate fair values, we may incur additional restructuring charges or non-cash impairment charges to goodwill or other intangible assets in the future. This is particularly true for our CDN services reporting unit, as well as our FCP products reporting unit within IP services.

Data Center Services

We offer a comprehensive solution at 47 service points, including nine locations managed by us and 38 locations managed by third parties. We charge monthly fees for data center services based on the amount of square footage that the customer leases in our facilities. We have relationships with various providers to extend our P-NAP model into markets with high demand.

Segment Information. We operate in three business segments: IP services, data center services and CDN services. IP services include managed and premise-based high performance IP and route optimization technologies. Data center services include hosting of customer applications directly on our network to eliminate issues associated with the quality of local connections. Data center services are increasingly being bundled with our high performance IP connectivity services. CDN services include products and services for storing and delivering digital media to large global audiences over the Internet.

IP Services . Revenues for IP services decreased $2.5 million, or 8%, to $28.6 million for the three months ended March 31, 2009, compared to $31.1 million for the three months ended March 31, 2008. The decrease in IP revenues was driven by the loss of several large customers during the three months ended March 31, 2009 and a large equipment sale during the three months ended March 31, 2008, a reduction in the rate at which we signed new customers and a decline in IP pricing, partially offset by an increase in overall traffic. There have been ongoing industry-wide pricing declines over the last several years. The effective price we charge our customers for IP Services, measured in megabits per second, or Mbps, decreased approximately 26% from the three months ended March 31, 2008 to the three months ended March 31, 2009. However, we continue to experience increasing demand for our traditional IP services. IP traffic increased approximately 31% from the three months ended March 31, 2008 to the three months ended March 31, 2009. The increase in IP traffic resulted from customers requiring greater overall capacity due to growth in the usage of their applications, as well as in the nature of applications consuming greater amounts of bandwidth. IP services revenues also included FCP and other hardware sales of $0.7 million and $1.1 million for the three months ended March 31, 2009 and 2008, respectively.

Data Center Services

The growth in data center revenues and direct costs of data center services largely follows our expansion of data center space, and we believe the demand for data center services continues to outpace industry-wide supply. Direct costs of data center services, exclusive of depreciation and amortization, have substantial fixed cost components, primarily for rent, but also significant demand-based pricing variables, such as utilities, which are highest in the summer for cooling the facilities. Direct costs of data center services as a percentage of revenues vary with the mix of usage between sites operated by us and third parties, referred to as partner sites, as well as the utilization of total available space. While we recognize some of the initial operating costs, especially rent, of sites operated by us in advance of revenues, these sites are more profitable at certain levels of utilization than the use of partner sites. Conversely, costs in partner sites are more demand-based and therefore are more closely associated with the recognition of revenues. We seek to optimize the most profitable mix of available data center space operated by us and our partners and have reduced the number of vendors utilized for partner sites. The increase in initial operating costs of sites operated by us drove the higher percentage of direct costs for the three months ended March 31, 2009 compared to the same period in 2008. We expect direct costs of data center services as a percentage of corresponding revenues to decrease as the recently expanded sites operated by us contribute to revenue and become more fully utilized.

CDN Services . Revenues for our CDN services segment decreased $1.0 million, or 18%, to $4.7 million for the three months ended March 30, 2009, compared to $5.7 million for the three months ended March 31, 2008. The decrease in revenues was primarily due to a continuing highly-competitive market for CDN services that is driving lower prices and higher customer churn.

As part of our ongoing review of our business and segments, we are considering possible changes in how we report, monitor and measure our CDN services relative to IP and data center services. We cannot anticipate that any such changes will directly result in restructuring or impairment charges. However, we may nevertheless incur additional restructuring or non-cash impairment charges to goodwill or other intangible assets in the future if operating results deteriorate or do not improve and/or if unfavorable changes continue to occur in other economic factors used to estimate fair values. This is particularly true for our CDN services reporting unit, as well as our FCP products reporting unit within IP services.

Direct Costs of Customer Support. Direct costs of customer support were $4.4 million for both the three months ended March 31, 2009 and 2008. There was an increase of $0.5 million in cash-basis compensation and benefits including severance related to a former vice president who was terminated separately from the restructuring plan, partially offset by decreases of $0.2 million in stock-based compensation and $0.1 million in facilities and related costs.

Product Development. Product development costs for the three months ended March 31, 2009 decreased 17% to $1.9 million from $2.3 million for the three months ended March 31, 2008. The decrease of $0.4 million was attributable to decreases of $0.1 million in each of professional services costs, cash-basis compensation and benefits, and stock-based compensation.

Sales and Marketing. Sales and marketing costs for the three months ended March 31, 2009 decreased 12% to $7.8 million from $8.8 million for the three months ended March 31, 2008. The decrease of $1.0 million was comprised primarily of $0.7 million in lower sales commissions and $0.1 million for stock-based compensation as discussed above.

Alabanza Reports Exaggerated

follow up by the WHIR:

>>Alabanza Reports Exaggerated

A customer report claiming that web host NaviSite's (www.navisite.com) affiliate Alabanza (www.alabanza.com) was the targets of a hacking attempt Friday night was greatly exaggerated, representatives from the company told the WHIR.

NaviSite says Schoolfield’s claims are untrue, however, and that fewer than seven servers were affected by the incident, which was handled quickly by the company. On Sunday evening, NaviSite shut down SSH access temporarily in order to address the vulnerability.

“NaviSite’s Alabanza teams followed industry best practices regarding security and customer communications,” said senior vice president Sumeet Sabharwall in a statement.

NaviSite Suffers Weekend Outage

from Web Host Industry Review, Inc:

>>NaviSite Suffers Weekend Outage

(WEB HOST INDUSTRY REVIEW) -- Over the past weekend NaviSite (www.navisite.com) was the target of hackers, leading some servers to face as many as eight hours of downtime beginning Friday night, and their negligence to respond to the threats caused additional downtime, according to customer reports.

Paul Schoolfield, a partner at ITX Design (www.itxdesign.com), a web hosting provider based in Fredericksburg, Virginia said NaviSite's support team ignored customers for about 48 hours until Sunday night, when they were forced to shutdown SSH access across the entire network for more than 24 hours to address the vulnerability.

NaviSite had not responded to email or voice messages by the time of this article's publication.

Android Gets Updated with haptics

a new Android OS update introduces touch-screen haptics into Google's mobile phones operating system. From the IV MB, by cellodude:

>>Flash: T-Mobile G1 Google/Android phone gets haptics next week!

A new Android OS update features touch-screen haptics! The G1 is the first Android/Google phone to have IMMR haptics, and users will be able to update next week!

from PCWorld:

>Android Gets Updated to Version 1.5

Daniel Ionescu

May 7, 2009 3:28 pm

The long-expected update to the Android operating system, version 1.5, has arrived. T-Mobile will be rolling out the new OS to existing G1 phones starting sometime next week. While you wait for your share of the software upgrade, take heart: There's plenty to be excited about in the 1.5 release.

The final release of the Android 1.5 OS, previously known as "Cupcake", finally brings an on-screen virtual keyboard with vibration feedback, plus video recording, playback, and sharing via YouTube. T-Mobile is expected to roll out this update to all its G1 customers by the end of the month.

SoftLayer Launches CloudLayer Suite

from Data Center Knowledge:

>>SoftLayer Launches CloudLayer Suite

Combining a public and private network in a “hybrid” infrastructure is all the rage these days. But it’s nothing new for SoftLayer, which has been using this approach since the company was founded in 2005.

CloudLayer offers customers the choice of a monthly plan or resource-based “pay as you go” billing, and leverages SoftLayer’s automated service delivery platform to integrate multi-site storage and backup and CDN offering (supported by Internap’s CDN network). The storage and CDN services are available now, while the CloudLayer Computing service will launch shortly, the company said.

SoftLayer is based in Plano, Texas, and operates data centers at the Dallas Informart carrier hotel, and in Internap facilities in Seattle and northern Virginia. The company has more than 5,500 customers in 110 countries, with about half based outside the United States. SoftLayer manages 21,000 customer servers, and has annual revenue of more than $75 million, the company said.

Equinix analyst day: A few surprises and a hefty dose of 'stay the course'

from Tier 1 Research daily newsletter:

>>T1R recently attended Equinix's analyst day and came away with a few interesting conclusions. First, Equinix is clearly staying the course in its overall strategy, with a specific emphasis on ensuring sufficient datacenter inventory in key markets. That means, in all probability, that we won't see any expansion markets until ...

Immersion 10 Q highlights

Immersion 10-Q highlights

7. LONG-TERM DEFERRED REVENUE

On March 31, 2009, long-term deferred revenue was $17.7 million and included approximately $16.3 million of deferred revenue from Sony Computer Entertainment. On December 31, 2008, long-term deferred revenue was $16.9 million and included approximately $15.4 million from Sony Computer Entertainment.

Based on our litigation conclusion and new business agreement entered into with Sony Computer Entertainment in March 2007, we are recognizing a minimum of $30.0 million as royalty and license revenue from March 2007 through March 2017, approximately $750,000 per quarter.

We expect that the accretion of interest income from Sony Computer Inc. that was approximately $272,000 in the three months ended March 31, 2009 and will total approximately $1.3 million in 2009 will be completed at the end of 2009.

In March 2007, we concluded our patent infringement litigation against Sony Computer Entertainment and we received $97.3 million. Furthermore, we entered into a new business agreement under which, we are to receive twelve quarterly installments of $1.875 million for a total of $22.5 million beginning on March 31, 2007 and ending on December 31, 2009. As of March 31, 2009, we had received nine of these installments.

Stock Repurchase Program

On November 1, 2007, the Company announced that its board of directors authorized the repurchase of up to $50 million of the Company’s common stock. The Company may repurchase its stock for cash in the open market in accordance with applicable securities laws. The timing of and amount of any stock repurchase will depend on share price, corporate and regulatory requirements, economic and market conditions, and other factors. The stock repurchase authorization has no expiration date, does not require the Company to repurchase a specific number of shares, and may be modified, suspended, or discontinued at any time. During the three months ended March 31, 2009, there were no stock repurchases under this program.

....

On March 2, 2009, the Company announced that it was relocating its Medical business operations from Gaithersburg, Maryland to San Jose, California. The Company had workforce reductions that were recorded as Medical segment restructuring charges for the three months ended March 31, 2009. Workforce reduction costs consisting of severance benefits of $166,000 are included in accrued compensation on the Company’s condensed consolidated balance sheet. In addition, the Company expects to record approximately $200,000 of workforce reduction costs relating to the remaining service period of these Medical division employees for the three months ended June 30, 2009, bringing the cumulative total to $366,000. All of the severance benefits are expected to be paid in the second or third quarter of 2009 with the exception of certain COBRA costs that will be paid by the end of 2009. The Company will also incur costs in the remainder of 2009 for temporary housing, the closing down of the Gaithersburg, Maryland facility, and the movement of operations to the San Jose facility.

On November 17, 2008, the Company announced that it would divest its 3D product line which was part of its Touch segment. The Company’s 3D product line consisted of a variety of products in the area of 3D digitizing, 3D measurement and inspection, and 3D interaction and included products such as MicroScribe digitizers, the CyberGlove family of products, and a SoftMouse 3D positioning device. In the three months ended March 31, 2009, the company sold its CyberGlove and SoftMouse 3D positioning device product families including inventory, fixed assets, and intangibles and has recorded a gain on sale of discontinued operations of $167,000. Negotiated consideration received for the sales was $900,000 in the form of cash and notes receivable and the proceeds are being recognized when they are received. The Company has abandoned all other 3D operations. Accordingly, the operations of the 3D product line have been classified as discontinued operations, net of income tax, in the condensed consolidated statement of operations. Revenues included in discontinued operations of the 3D product line were $531,000 and $1.2 million for the three months ended March 31, 2009 and March 31, 2008, respectively. The assets sold consisted primarily of intangibles that had no carrying value on the Company’s books at the time of sale.

In addition, for the first three months of 2009, there were reorganizations in the Company’s Touch segment due to business changes causing workforce reductions that have been recorded as accrued compensation in the company’s condensed consolidated balance sheet and restructuring charges in the statement of operations for the three months ended March 31, 2009.

Three Months Ended March 31, 2009 Compared to Three Months Ended March 31, 2008

Total Revenue — Our total revenue from continuing operations for the first three months of 2009 increased by $49,000 or 1% from the first three months of 2008.

Royalty and license revenue — Royalty and license revenue is comprised of royalties earned on sales by our TouchSense licensees and license fees charged for our intellectual property portfolio. Royalty and license revenue for the three months ended March 31, 2009 was $3.8 million, an increase of $320,000 or 9% from the three months ended March 31, 2008. The increase in royalty and license revenue was primarily due to an increase in royalty and license revenue from our Touch segment from increased shipments by licensees of mobile devices partially offset by decreased shipments by gaming and automotive licensees. We expect royalty revenue to be a significant component of our revenue as our technology continues to be included in mobile phone handsets and other mobility devices.

We categorize our geographic information into four major regions: North America, Europe, Far East, and Rest of the World. In the first three months of 2009, revenue generated in North America, Europe, Far East, and Rest of the World represented 45%, 29%, 24%, and 2%, respectively, compared to 62%, 23%, 11%, and 4%, respectively, for the first three months of 2008. The shift in revenues among regions was mainly due to an increase in royalty revenue and medical product revenue from Europe and the Far East and a decrease in royalty and medical contract revenue in North America and Medical product revenue from the Rest of the World. We partially attribute increased European and Far East revenue to the addition of increased international sales and support personnel in 2008.

Sales and Marketing — Our sales and marketing expenses are comprised primarily of employee compensation and benefits costs, advertising, public relations, trade shows, brochures, market development funds, travel, and an allocation of facilities costs. Sales and marketing expenses from continuing operations were $4.8 million, an increase of $1.6 million or 52% in the first three months of 2009 compared to the comparable period in 2008. The increase was primarily due to an increase in bad debt expense of $571,000 primarily from one customer that has not paid within terms, increased compensation, benefits, and overhead of $357,000, increased marketing, advertising, and public relations costs of $291,000, increased consulting costs of $220,000 to supplement our sales and marketing staff, and increased sales and marketing travel expense of $171,000. The increased sales and marketing expenses were primarily due to the expansion of our sales and marketing efforts internationally. We are taking steps to reduce our sales and marketing expenses, although we expect to continue to focus our sales and marketing efforts on medical, mobile device, and touchscreen market opportunities to build greater market acceptance for our touch technologies as well as continue to expand our sales and marketing presence internationally.

Restructuring — Restructuring costs consist primarily of severance benefits paid in connection with the reduction of workforce due to severance benefits to be paid as the result of a planned reduction of workforce due to the relocation of the Maryland medical business operations to San Jose of $166,000 and severance benefits to be paid as the result of the reduction of workforce due to business changes in our Touch segment of $480,000. There were no restructuring charges incurred in the three months ended March 31, 2008. We expect to record approximately $200,000 of workforce reduction costs relating to the remaining service period of the Maryland business operations employees plus additional costs relating to the move and close down of facilities in the second quarter of 2009.

Interest and Other Income — Interest and other income consist primarily of interest income and dividend income from cash and cash equivalents and short-term investments and gain on sale of short-term investments. Interest and other income decreased by $1.1 million in the first three months of 2009 compared to the same period in 2008. This was primarily the result of decreased interest income due to a reduction in cash equivalents and short-term investments and reduced interest rates on cash, cash equivalents, and short-term investments. We expect that the accretion of interest income from Sony Computer Inc. that was approximately $272,000 in the three months ended March 31, 2009 and will total approximately $1.3 million in 2009 will be completed at the end of 2009.

Touch segment — Revenues from the Touch segment were $4.5 million, an increase of $513,000 or 13% in the first three months of 2009 compared to the same period in 2008. Royalty and license revenues increased by $320,000 mainly due to increased shipments by licensees of mobile devices partially offset by decreased shipments by gaming and automotive licensees. Development contract revenue increased by $182,000 primarily due to increased development contracts and support. Net loss for the three months ended March 31, 2009 was $4.3 million, an increase of $2.9 million compared to the same period in 2008. The increase was primarily due to an increase in provision for income taxes of $1.3 million, a decrease in interest and other income of $996,000 mainly due to reduced interest rates and a reduction in cash equivalents and short-term investments, an increase of research and development expenses of $603,000, an increase in restructuring costs of $480,000, an increase in sales and marketing expenses of $417,000 and an increase in amortization expense of $140,000. The increases to the net loss were partially offset by increased gross margin of $850,000 due to increased royalty and license revenue and a decrease in general and administrative expenses of $189,000.

Medical segment — Revenues from the Medical segment were $2.5 million, a decrease of $470,000 or 16%, for the first three months of 2009 compared to the same period in 2008. The decrease was primarily due to a reduction of medical development contract revenue due to the completion of work performed under medical contracts that occurred through the first six months of 2008 partially offset by an increase in product sales mainly due to increased sales of our endovascular and laparoscopy simulators. Net loss for the three months ended March 31, 2009 was $3.2 million, an increase of $2.0 million compared to the same period in 2008. The increase was mainly due to increased sales and marketing expenses of $1.2 million as the segment expands international sales and marketing efforts, increased general and administrative expenses of $292,000, a decrease in gross margin of $261,000 primarily due to reduced development contract revenue, and an increase in restructuring costs of $166,000.

Immersion Corporation v. Mentice AB, Mentice SA, Simbionix USA Corp., and Simbionix Ltd.

On April 16, 2008, we announced that our wholly owned subsidiary, Immersion Medical, Inc., filed lawsuits for patent infringement in the United States District Court for the Eastern District of Texas against Mentice AB, Mentice SA, Simbionix USA Corp., and Simbionix Ltd (collectively the “Defendants”), seeking damages and injunctive relief. On July 11, 2008, Mentice AB and Mentice SA (collectively, “Mentice”) answered the complaint by denying the material allegations and alleging counterclaims seeking a judicial declaration that the asserted patents were invalid, unenforceable, or not infringed. On July 11, 2008, Simbionix USA Corp. and Simbionix Ltd, (collectively, “Simbionix”) filed a motion to stay or dismiss the lawsuit, and a motion to transfer venue for convenience to Ohio. On August 7, 2008, we filed our opposition to both motions filed by Simbionix. The court has not ruled on the pending motions. On December 2, 2008, the court held a status conference in which it set a trial date for December 5, 2011 and a claim construction hearing for June 1, 2011. We intend to vigorously prosecute this lawsuit.

Equinix to Sponsor RIPE's 20th Anniversary Meeting, RIPE 58

Equinix to Sponsor RIPE's 20th Anniversary Meeting, RIPE 58

4 - 8 May 2009, Krasnapolsky Hotel, Amsterdam

AMSTERDAM, Netherlands — 4 May, 2009 — Equinix Inc. (Nasdaq: EQIX), a provider of global data centre services, has announced that it will sponsor Réseaux IP Européens (RIPE) 58. Taking place between 4 – 8 May 2009 at the Krasnapolsky Hotel in Amsterdam, RIPE is a bi-annual forum for Internet service providers, network operators and related parties who gather from Europe and around the world to discuss Internet policy.

RIPE’s 58^th meeting marks the 20^th anniversary of RIPE gatherings, and in commemoration, industry veteran Remco van Mook of Equinix will lead a track of presentations that address the issue of capacity planning, a topic that first appeared on the RIPE agenda 20 years ago.

Van Mook will bring together a selection of speakers from Akamai, AMS-IX and Equinix to explore all aspects of capacity planning, discussing the potential benefit of community interaction on this important topic, including the implications for all participants in the Internet ecosystem.

Speakers include Christian Kaufman, Peering Coordinator at Akamai Technologies, Henk Steenman CTO at AMS-IX, and Harro Beusker, Vice President of Corporate Development, Europe at Equinix.

“It is remarkable that after 20 years one of the main agenda points from the original RIPE meeting remains relevant. Discussing capacity planning issues in an open community forum increases the opportunity for everyone’s growth and success,” said van Mook . “RIPE 58 represents a great and unique opportunity to bring together a diverse mix of parties to discuss the state of the market and their plans for the future. We look forward to sharing our collective insight on what industry leaders are doing in the area of capacity planning.”

Meeting participants are invited to join Equinix on the Monday evening directly after the Plenary session for cocktails and informal discussion of industry growth plans, challenges and opportunities.

CyberKnife for Breast Cancer

from the IV MB, by PauvrePapillon:

>>CyberKnife for Breast Cancer

Département de radiothérapie, Centre Antoine Lacassagne, Nice, France now using CyberKnife with Synchrony for Breast Cancer

This is a market that was not anticipated by management. Their estimate of 3,500 centers in the U.S. (and 3,500 additional Centers worldwide) to handle patient demand did not include CyberKnife treatment for breast cancer.

From Robotic Stereotactic Radioablation Concomitant with Neo-Adjuvant Chemotherapy for Breast Tumors

“The study showed the feasibility of irradiation with RSR combined with chemotherapy and surgery for breast tumors. There was no skin toxicity at a dose of 19.5 Gy or 22.5 Gy delivered in three fractions combined with chemotherapy. Lack of toxicity suggested that the dose could be increased further. Pathologic response was acceptable.”

http://www.redjournal.org/article/S0360-3016(09)00026-1/abstract

a list of future CKs that should be sold/installed in the next few months, according to news found on the Internet. Post by yyy60 on the IV MB:

New CKs coming soon

USA

===

- Brookwood Medical Center in Birmingham, Alabama open very soon
- Fox Chase Cancer Center, Philadelphia open in July
- St. Luke's Episcopal Hospital in Houston open July
- Michael E. DeBakey VA Medical Center in Houston open soon
- Clear Land Medical Center in Houston open this summer/fall
- Penrose-St. Francis Health Services in Colorado Springs open this summer
- Saint Francis Hospital Memphis, TN approved summer 2008
- Memorial Hospital West, Pembroke Pines FL approved Oct 2008
- Stereotatic Radiation Oncology of Henry County, GA approved July 2008
- Stereotactic Radiation Oncology of Newnan, Newnan, GA approved July 2008
- Erlanger Hospita, Chattanooga TN, approved April 2009
- El Camino Hospital, Silicon Valley CA, approved April 2009


OVERSEA
=======

Canada, Italy, German, Russia (two), Czech, Saudi Arabia, Venezuela, UK, Taiwan, China

Church and society in Ukraine are beginning to collect funds for the cyber knife

from the IV MB, by yyy60:

>>Church and society in Ukraine are beginning to collect funds for the cyber knife

CNL - NEWS 04.05.2009

For the treatment of cancer Ukraine needs a cyber-knife - the newest to date technology in the world to treat cancer. This was discussed at a meeting today in UKRINFORM round table entitled "How a catastrophic situation for the treatment of cancer."

Representatives of major religious denominations in Ukraine, as well as civil society organizations that participated in the round table, preparing to organize All-Ukrainian campaign to raise funds for the purchase of this unique equipment.

Cloud Computing: What’s all the buzz about?

from the Navisite blog:

>>No matter what, “Cloud Computing” is definitely something we at NaviSite are going to be closely involved with. It is a highly efficient alternative to traditional IT resources, and many companies are exploring its potential. Though the ideas aren’t necessarily brand new for NaviSite, this will be interesting to watch and participate in.

Notes from Chicago - Cyberknife presentation

this is a post from the IV MB, by PauvrePapillon:

>>Notes from Chicago

Here’s a quick report from Chicago.

Varian, Tomo and Intuitive Surgical executives attended the CyberKnife presentation at AUA. They stood in the back of the room and scowled. You can make of this whatever you want, I still maintain that if they didn’t view Accuray as a threat, they wouldn’t have nearly as much energy on trying to discredit CyberKnife for prostate.

At the Radiosurgery Course, there were excellent technical presentations from CyberKnife users specializing in CyberKnife for malignant tumors of the prostate (both homogeneous and HDR treatment patterns), lung (both primary and metastatic), brain (both primary and metastatic), spine, liver, pancreas and kidney as well as benign tumors of the spine and trigeminal neuralgia.

The main points of interest to investors:

Prostate results are excellent and if we were going to see biological failures we should have already seen at least some at three years out. The technical explanation has to do with the presumed alpha/beta ratio for prostate cancer (you can go look that debate up if you want to) but the bottom line for investors is that the data may not be old enough to be 100 percent conclusive but it’s starting to look particularly grim for the high alpha\beta ratio school and that’s good news for CyberKnife.

We investors tend to view CyberKnife as a treatment when in reality it is a tool that can be used in a numerous variety of ways. All of the treatment models are still works in progress. Centers are still experimenting with dosages, fraction schedules, treatment plans and other techniques. Outcomes are improving as physicians gain more experience with CyberKnife. Whatever the stats look like now, they are going to look even better a few more years out and that applies to just about all, if not in fact all, types of treatments.

Some centers that have been treating prostate for three years are now finding they get almost all their new patients from patient-to-patient referrals. Centers are also reporting that they are seeing very sophisticated patients that have done their research and know what they want when they come through the door.

Accuray has a fulltime team focused on coding and coverage issues. They are making progress and the trend is moving in our direction. While CyberKnife Centers are currently billing and being paid pursuant to non-listed codes, proposals for specialty specific codes (including prostate) have been presented for all of the major CyberKnife treatments.

Georgetown went from a $95 million per year deficit to a $22 million per year profit in large part due to the cash flow and rebranding effects of their CyberKnife program, this according to Linda Winger, MSc, FACHE, Vice President of Professional Services and Research Administration.

Ms. Winger is also the founder of the CyberKnife Coalition and an active and effective advocate for CyberKnife. When Palmetto dropped CyberKnife for prostate from Medicare coverage in California, Nevada and Hawaii, Ms. Winger played a key role in helping Palmetto see the light and restore patient access for these cases. Ms. Winger has also been actively lobbying Capital Hill to create awareness of CyberKnife. She reports that these efforts have already started to bear fruit in that she was able to enlist the support of both of California’s Senators (Boxer and Feinstein) in her successful effort to persuade Palmetto to restore coverage for CyberKnife for prostate. Since, in my view, government takeover of the healthcare system is the only serious threat to widespread CyberKnife adoption in the United States, the news that California’s two Communist Senators are supportive of CyberKnife and have already intervened on the side of patient access is especially encouraging.