• UK-based mobile operator, Vodafone, announced record annual losses of £14.8 billion at the end of May 2006. That loss, the largest ever encountered by a UK company, was attributed to the mark down of German telco Mannesman which Vodafone enthusiastically acquired in 2000 for £112bn. Vodafone incurred one-off costs of £23 billion when Mannesman was revalued earlier this year.

• Richard Granger, director general of IT at the UK’s National Health Service, deflected criticism over his handling of the $7 billion Connecting for Health project by pointing the finger at the projects’ suppliers, which include consultancy Accenture. Some reports suggest that the final cost of the programme could exceed £20 billion. Granger poured scorn on the suppliers’ ability to forecast costs: “The IT industry is still trying to claim that there’s a scientific basis behind its estimations of the costs involved in outsourcing projects, when practical experience shows that there isn’t.”

• Meanwhile, the fall out from the disastrous Connecting for Health project claimed the CEO of one its principal providers, iSoft. After a restatement of iSoft’s financial results found the company was not profitable, as had been previously thought, Tim Weston resigned from the post saying that his tenure there would attract continued criticism, distracting others at the company.

• IBM is to triple its investment in India, pledging to spend $6 billion over the next three years on both its outsourcing and research and development practices on the sub-continent. “This investment will ensure that we make the most of the opportunities to grow this marketplace, while enabling IBM to fulfil its vision of becoming a globally integrated company,” said IBM chief executive Sam Palmisano. Last year, IBM cut 13,000 jobs, most of which were in Europe.

• Embattled systems management software maker CA – formerly Computer Associates – is still struggling to shake off its accountancy problems. The company has seen a number of senior executives depart in recent months. That follows years of financial scandals which resulted in former CEO Sanjay Kumar plead guilty to fraud, perjury and obstruction of justice charges in relation to the $2.2bn (£1.2bn) accounting fraud at the company. The problems continue to dog CA, and it has delayed reporting its latest financial results and warned of unexpected losses.

• The SCO Group’s long running legal battle with IBM over Linux intellectual property rights looks increasingly unlikely to ever reach court. SCO is rapidly running out of money: its latest figures show revenues for the quarter ending 30 April 2006 of just $7.13 million, down from $9.26 million in the same period a year earlier. The company has introduced new products in the first half of 2006, but met with little enthusiasm in the market.

• The European Commission will force mobile operators to drastically reduce the price of using mobile phones abroad. However, the Commission has backtracked on plans to force operators to charge the same rate for roaming calls as ones made at home. Instead, it proposes to allow operators to charge a 30% premium on roaming calls.

Infoconomy Index: A stable economy

The global IT industry is finding its new base growth level. During April, the Infoconomy Index, which charts the rate of revenue growth at the world’s 200 largest IT companies, held steady at 6.8%.

At a regional level, the story was slightly different, with the subset of European companies in the index bucking the global trend with a drop of a full percentage point to 8.1%.

Globally, the trend was kept upward by strong quarterly revenues from a number of prominent vendors. In particular, Research in Motion, the maker of the popular Blackberry handheld email device, lifted the overall rate with a 39% increase in revenue, despite further lawsuits alleging its device infringes others’ patents. At the same time, Sun Microsystems reported uncharacteristically high growth of 21%, although the bulk of that uplift came from its acquisition of StorageTek. Other notable revenue increases were reported from server applications enabler Citrix (29%), offshore IT services vendor Cognizant (57%) and storage giant EMC (14%).

But keeping the index in check were below-par earnings from other global vendors. IBM’s quarterly revenues are still showing a downturn: they fell 10% largely as a legacy of the sale of its PC business to Chinese systems giant Lenovo; sales at chip manufacturer Intel fell 5%; the pace at networking vendor Lucent dropped 8%; and security vendors Check Point and Verisign saw growth slow to 3% and 4% respectively.

Among companies with European origins there were some strong performances. Growth was up sharply at business intelligence vendor Business Objects (12%), applications software maker Exact Software (10%) and engineering design software vendor Dassault Systemes (27%). But others contributed to the index’s decline of 1%, including a 1% drop in revenues at services group Atos Origin.

Infoconomy 200 Index measures the overall growth rate of the IT industry by tracking the financial results of the world’s most important publicly listed IT companies.