Sunday Business Post - Media and Marketing - 28th January 2007
Last year, more music tracks were purchased as downloads in Ireland than were bought in CD-single format, writes Dermot Corrigan...
Last year, more music tracks were purchased as downloads in Ireland than were bought in CD-single format.
In 2006, there were 1.3 million physical singles bought and two million tracks downloaded.This total includes album tracks as well as specially released and marketed singles.
Meanwhile, annual digital music sales worldwide almost doubled toUS$2 billion.Inevitably, this change is having an impact on music charts. As of January 1, 2007, the Irish music singles’ charts now takes into account all music sold online, as well as the physical releases available in traditional bricks and mortar retailers.
‘‘The dramatic change in the way the charts are compiled is that you now don’t need a physical release to count in the charts,” said Dick Doyle, managing director of IRMA, the Irish Recording Music Association.
Online downloads were first counted in July last year, however for the first six months distributors were required to have a physical release in the shops within two weeks to be considered for the charts. From the start of this year, all music sold, whether over the internet or over the counter, is counted by ChartTrack, which compiles the sales figures for IRMA.
‘‘It has not had a massive impact, but some new things have come in,” said John Pinder, the managing director of ChartTrack.
Chasing Cars from Snow Patrol had stopped selling physically as the stock had run out, but it was still selling online and re-entered the charts.Queen’s Bohemian Rhapsody also entered on the strength of just downloads. While Chasing Cars was first released in August last year, Bohemian Rhapsody dates from October 1975.
The Christmas Number One in Ireland was X-Factor winner Leona Lewis with A Moment Like This. This song remained on top of the pile for the first two weeks of the new compilation system.
ChartTrack measure sales traffic at nine Irish downloading sites. These include large industry players such as the Apple’s iTunes and Sony Connect sites, smaller independent start-ups such as downloadmusic.ie, as well as downloads to mobile phones from 3 Music and Vodafone.This combination covers over 90 per cent of the total music bought online in Ireland.IRMA have been involved in promoting the official Irish singles and albums charts, based on consumer sales, since 1992, when Gallup were awarded the contract to compile the sales information.
ChartTrack have been providing the statistics since a management buy-out from Gallup in 1996. Both ChartTrack and IRMA are eager to make sure that the charts remain relevant in the 21st century.
‘‘The charts are there to reflect what the consumer is doing. The customer has been adapting more and more to the digital delivery services, whether through mobile downloads or to their computers. So it is up to us to reflect what the consumer wants, and what the consumer is buying,” said Doyle.
The new method of determining the singles charts opens up a number of different possibilities, including the prospect of one band filling all the spots in the top ten.
‘‘For example, if the new U2 album comes and all the tracks sell enough they could all get in the singles chart. It is really now a songs chart rather than a singles chart as such, said Pinder.
It also means the potential to see more golden-oldie or independent songs making surprise appearances in the singles charts.
Until recently if an old or previously unknown song came to prominence (for example after appearing on a Levi’s Jeans television advertisement or in a Quentin Tarantino movie) fans had to wait for distributors to react, whereas now they can go online in seconds to purchase the track.
‘‘People are going to hear things and then buy them,” said Pinder. ‘‘A big advert, using an old song can fire that back into the charts, or use of the song in a soap opera or on a film soundtrack. Different influences will push different songs.”
Another advantage for consumers is that the cost of downloading songs online is typically lower than purchasing a CD. For example, A Moment Like This costs €4.99 in HMV in Dublin, stg£3.99 on Amazon.co.uk and 99cent from iTunes.
There are now over four million songs available for immediate purchase online from approximately 500 online music services in 40 countries worldwide, however, due to Vat restrictions Irish consumers must buy only from Irish sites.This obviously poses a threat to the business model of high-street music retailers, who are being forced to adapt to the new reality. HMV recently installed booths in their stores where customers can purchase and download music on site.
‘‘I think traditional bricks and mortar retailers are going to have to offer both the physical disk and the online side,” said Doyle.Doyle predicts that we will see more independent acts represented in the Irish charts in the future.
‘‘A lot of independent acts - who for some reason haven’t been signed by a big label or do not want to be signed by a big label - will produce their own digital tracks and will sell them online,” he said.
‘‘It should mean more independent type acts will make it into the charts, and much more quickly,” said Doyle.
The four major global music distributors Universal, Sony BMG, Warner Music Group and EMI have also moved quickly to ensure their presence in the online market.
‘‘The download market, as well as the physical market, is still dominated by the four major labels,” said Pinder.
Dave Pennefather, managing director of Universal Music Ireland, said that he welcomed the step.‘‘It is wonderful that there are so many platforms out there where people can go and legitimately get access to the music available,” he said.
Universal was adapting well to the new reality, and despite the vexatious problem of illegal downloading, its sales were remaining constant.
http://www.sbpost.ie/post/pages/p/story.aspx-qqqt=MEDIA+AND+MARKETING-qqqs=mediaandmarketing-qqqid=20498-qqqx=1.asp
Sunday 28 January 2007
Huge digital impact on music charts
Thursday 25 January 2007
Opportunity Knocks for MBA Students
Sunday Business Post - Recruitment Section - 14 Jan 2007
There are many options for Irish professionals wishing to pursue an MBA here and abroad, writes Dermot Corrigan
In Ireland, all the main third level institutions, including University College Dublin; Trinity College Dublin; University College Cork; University of Limerick and the National College of Ireland, Galway, run Masters in Business Administration (MBA) and Executive Masters in Business Administration (EMBA) courses.
According toNick Barniville, MBA Programme Director at the UCD Michael Smurfit School of Business in Dublin, the best option for each candidate depends on their individual aims and circumstances.
“Different people have different goals for their MBAs,” said Barniville. “The main reason to do an MBA in Ireland is that the way business works here is so highly networked,” said Barniville. “One of the things that is different about Irish programmes is that there is more industry interaction.”
Irish students can also opt to study overseas in the US, Canada or Australia. Many EU countries offer MBA and EMBA courses tailored to the needs of international students, with English as the language of tuition.
“Getting international experience can only help someone in terms of getting a job, and in terms of having an exposure to the kinds of markets they will be dealing with in the future,” said Boris Porkovich, MBA director of the International University of Monaco.
“I think it is very important for people to study internationally is that in order to progress in any job now, everyone needs to understand clearly and carefully the differences that they will encounter. People need to actually know how to manipulate those differences in order to create better market opportunities for their companies.”
MBA programmes typically last for between one and two years, while EMBA courses are usually two year programmes.
Students on EMBA courses are more likely to remain working, and study by block release, where they take attend classes during a set number of weeks spread throughout the year. MBA programmes are usually, but not always, taught on a full-time basis from 9AM to 5PM on weekdays.
However, for candidates keen to add an international dimension to their career, there are definite advantages to studying abroad.
“If you are looking to have an international career, there is a big advantage in going to a school which has an international presence and having an international brand recognition,” said Arnold Longboy, Director of Corporate Relations and Recruitment with the Chicago Graduate School of Business – Europe Campus.
“One thing about doing an international programme is that usually the people you are studying with too tend to be much more international, so you will actually learn a lot more just by being with these students on the programme. Here in London we have forty different nationalities and you learn directly from the people from those cultures, as opposed to from a professor who has studied doing business in a different culture.”
The delivery methods and timetables of international MBA programmes at European and US universities are often designed with the requirements of international students in mind.
“75% of students taking our EMBA in London actually fly in from outside of the UK to participate in it,” said Longboy “About 80% are either Western, Eastern or Central European, then the rest come from the Middle East and Africa.”
One obvious consideration for potential MBA students is cost. Tuition fees for MBA programmes are typically higher than for other postgraduate courses. The fees for the full-time MBA Programme at Smurfit Business School for 2006-2007 are €26,700.
Barniville said that most students see the costs as an investment, considering the potential for improved earning potential following graduation. He said that the UCD fees compare favourably with international competitors such as the Saïd Business School in Oxford, Judge Business School in Cambridge, Rotterdam School of Management, and the Bocconi University School of Management in Italy.
There also lots of ancillary costs involved in travelling abroad to study, as well as potential difficulties involving family or social life.
Porkovich said MBA programmes differed from country to country. He said the US style is focused on intensive learning and is very practically oriented, while the European model tends to be less intensive and more academic.
Students can compare MBA programmes by using one of the four major international MBA rankings systems, published annually by the Financial Times, Business Week magazine, the Economist Intelligence Unit and the Wall Street Journal.
Some business schools in particular locations concentrate on particular areas. For example the International University of Monaco focuses on wealth and asset management, entrepreneurship and luxury services.
Longboy said some students opted for an international programme to smooth their transition to work in a new country.
“Our campus is right in the heart of the financial district, and some people take this programme because they may eventually want to have a career here in London, especially in finance,” he said.
Irish institutions are introducing programmes in areas in which they have specific advantages or competencies.
“We are probably going to see more niche MBAs coming onto the market,” said Barniville. “UCD have introduced an MBA in Health Services Management and we are looking at developing an MBA together with the Institute of Bankers in Financial Services and Regulatory Compliance.”
Microsoft Drives Interest
Sunday Business Post - Computers in Business Magazine - Jan 07 2007
Two new Microsoft software releases will form the basis for many training courses this year, but there is also much more on offer for those willing to expand their IT knowledge, writes Dermot Corrigan
Probably the most important development in Irish IT departments in 2007 will be the next wave of Microsoft product releases. The Windows Vista operating system was launched in December 2006, while Office 2007 and Exchange Server 2007 boxes will be hitting shelves and arriving on IT teams’ desks in the coming months.
There is generally a certain time lag between the product going on sale and its full introduction across an organisation. This time is usually filled with training and development courses for staff, so that the IT department can implement these products succesfully and troubleshoot them immediately. Irish training providers are gearing up to meet this demand, with the official Microsoft training programmes and curriculum set to be rolled out by Irish training providers on a gradual basis throughout 2007.
“In 2007 we are going to see a lot of interest in Microsoft Vista, obviously the product was just launched recently. We are going to get a lot of demand for training of both engineers and developers alike. We will also get a lot of call for the user community of Office 2007,” said Etain Delaney, Corporate Account Manager with Sureskills.
“To date we have already offered a few tailored workshops on Microsoft Vista and Microsoft Exchange 2007, but as the official curriculum is launched by Microsoft in 2007 we will start running those as well.”
Calyx are another certified Microsoft training partner who are putting in place a number of introductory training courses to meet the release of the new Microsoft products.
“We do not expect to see Vista courses for a number of months while people get to grips with it and plan their own deployments, but we are offering a number of previews and half day and one day courses looking at the planning of Vista deployment,” said Richard Glavin, Managing Director of Calyx Training.
“There is also the release of Microsoft Exchange 2007 – the new email platform from Microsoft – and we have run some courses on that already, sort of first look courses where people can come in and have a play around etc. Again we are seeing that people will be deploying the latest Exchange in the first half of the year and we would expect to see significant training business as a result,” said Glavin.
Microsoft products already established in the market will also be the focus of much attention from Irish IT training managers in 2007.
“Microsoft SQL 2005 – we have been getting a lot of demand for this now. We would have traditionally provided a lot of training on Microsoft SQL 2000, and a lot of the curriculum has been recently updated so we are providing a lot of those courses as well,” said Delaney.
The concept of VMware is another of the major developments to have exploded on the IT scene in recent times. VMware is such an innovative technology that even technical staff are having to learn the ropes almost from scratch. As more and more organisations incorporate VMware into their server infrastructure and processes in 2007 the demand for relevant training courses is set to increase.
“Virtualisation as a technology is completely new and end users would attend the course pre-implementation just to understand the technology itself, because it is a complete change in their infrastructure and also to give them hands on experience in managing the new virtualised infrastructure,” said Enda Fitzpatrick, Sales Manager with Commtech Distribution.
Sureskills are also putting in place VMware courses.
“We offer a four day course entitled ‘VMware Infrastructure Version 3 Install and Configure’ and this course also prepares for the VMware certified professional exam as well. Students who take the course can also take the exam at our centre. We also offer training upgrade sessions as well from older versions of the product,” said Delaney.
Security is going to be a huge issue in 2007 across all aspects of IT in business. While threats continue to multiply and become increasingly sophisticated, training providers are simultaneously updating their course offerings.
“We do security solutions courses in three name products - SonicWALL, McAfee and Blue Coat,” said Fitzpatrick. “These are very very high end enterprise security courses. We are running them both for partners and for end users. We ran our first McAfee course last month and it was very successful because they have made a number of changes and also come out with a number of new products”.
The area of security is of course not just about dealing with external threats. Companies have to protect themselves from issues and scandals around inappropriate staff behaviour. Merely installing anti-virus software or sending circulars to staff members is not sufficient. Management have a legal and moral responsibility to develop in-depth security policies, and one important aspect of this is to have a highly trained member of staff who can make sure their network is safe and clean.
One new and novel course which is being introduced in 2007, is the postgraduate certificate in Information Security and Penetration Testing from Ashfield Computer Training. This is the very first FAS approved postgraduate course in Ireland. It was designed by the University of Glamorgan and Ashfield are the sole Irish college offering the programme.
“It is the first course in the world that offers a university qualification for people who are doing ethical hacking and cyber forensics,” said Eileen McGinn, MD with Ashfield. “Ethical hacking is where you get permission from an organisation to look at the vulnerabilities that exist in their system so that you can mitigate against a dangerous or black hat hacker breaking into the system. We get there first so people are aware of the possibilities.”
McGinn said that the course will teach techniques and develop skills in industry which would previously only have been used in police departments or military situations.
“This is a rather niche market in terms of people who have exposure to this level of knowledge, but because it has been turned into a mainstream university academic qualification, we now have the facility and the ability to be able to teach this to network engineers, or network administrators, who want to strive to get up the corporate ladder and also look at the level of IT security in high end businesses,” she said.
The 2007 entry course is already booked up, and Ashfield are considering adding extra places. They are also looking at introducing a similar qualification in Mobile Forensics towards the end of 2007.
Internet communications and multimedia are another area where course providers are expecting significant interest in the coming year. McGinn said that the Certified Internet Webmaster (CIW) qualification is becoming increasingly popular with IT professionals who are looking to add a recognised qualification to their CV and work on the latest web-related skills such as XHTML design, as well as security and administration aspects of web development.
Maybe the biggest factor in the strong growth of the technical IT training sector in Ireland over the last few years has been the implementation of the FAS Competency Development Programme, which helps businesses meet the costs of training their staff. This typically means that FAS will refund 60 to 70% of the course fees of any recognised course.
2007 will see course providers such as Calyx working proactively with FAS to develop technical IT training programmes which are pre-approved for funding.
“At the moment people have to claim a rebate from FAS after completion of the course, whereas we will be offering the discount up front and they will just have to pay the balance, which makes it even easier for companies to send staff on FAS approved courses this year,” said Glavin.
The availability of funding means that courses which were offered by providers in the last few years are now more popular as the costs have come down so much.
“One area that continues to be very popular is the Microsoft Certified System Administrator and the Microsoft Certified System Engineer tracks – the MCSA and MCSE Certification tracks,” said Delaney. “We have actually seen, even though we have always run these courses over the last few years, that courses are now filling up and we are putting on additional dates to cope with the demand. We would envisage running quite a lot of those in 2007.”
Another trend that course providers are seeing in the market, and expecting to continue in 2007, is that individuals are constantly upskilling and diversifying their skillsbase as their careers progress.
“Employees are very aware of the need to be trained,” said McGinn. “We have a lot of individuals coming to us wanting to become certified, starting out with the A+ technicians course, and then progress on to do the networking, which would be the Microsoft Certified Systems Administrator (MCSA) and then on to Cisco router courses. So they are going out with that mix of qualifications that allows them to troubleshoot hardware issues, and also to troubleshoot network issues. You need multiple certifications to be taken seriously, the diversity of technology is so vast that is important you have cross platform knowledge and experience.”
Another certification that is in demand is the Information Technology Infrastructure Library (ITIL).
“This is a set of best practice standards for IT service management, which has been popular over the last few years but we are seeing an increasing demand for public courses tied into the certification,” said Delaney. “This has been very popular as it is a public domain framework and it is very scalable, so it can be put into practice across a number of organisations and they can also be adapted according to each individual organisation’s needs.”
2007 is unlikely to be the year when e-learning really takes off. While many course providers offer e-learning options and incorporate e-learning aspects into their programmes through blended solutions, we will have to wait for most of the more adventurous predictions about the emergence of the virtual classroom to be realised.
Where we will see a certain amount of e-learning in 2007 is as a complimentary add-on to existing classroom based or on-site training programmes.
“We offer customers e-learning as part of the overall package. As soon as somebody books a course we give them access to the online portal and they can go and have a look at the course content, do some pre-course assessment etc, so that when he comes into the course he is well prepared and gets more out of it and similarly then for three months after the course they have access to extra resources as well, for instance allowing revision for an exam. Definitely e-learning is complimentary to the training, but it doesn’t replace it,” said Glavin.
Looking on down the line to 2008 and further, it is safe to predict many more advances and developments in technical IT training courses and solutions. Irish course providers are keen to keep abreast of international trends and are constantly looking to ensure their programes stay bang up to date.
“New technology is really what we are looking at. We are looking to find leading edge technology which is close to the market and might be emerging in the UK or American market, but maybe a year away, and we adopt it into the Irish market and provide training.,” said Fitzpatrick.
IT is never going to stand still, and professionals working in the sector have to make sure they keep up with the latest developments in today´s knowledge economy. Irish IT training providers are working hard to put in place programmes for 2007 to meet this demand and ensure that Ireland continues to play a leading role in the global IT industry. Observers of the sector expect continued support from government and industry leaders.
“The government recognise the importance of training of high skill workers and ensuring that productivity remains high to keep the Irish IT sector competitive, because otherwise Ireland will become less attractive as a location for investment,” said Glavin.
Sales may break 180,000 barrier
Sunday Business Post - Winter Motoring Supplement - December 10 2006
New car sales in Ireland are expected to total 180,000 by the year's end, according to Eddie Murphy, chairman of Ford Ireland.
“Car sales in
With late sales projections down on the projections forecast for the start of 2006, the mood in motoring circles is one of caution.
“The market slowed down quite a bit towards the end of this year, which was a bit contrary to what we all expected,” said Frank Kennedy, General Manager with Honda Ireland.
“Interest rate hikes and so forth, and the general economic conditions would have cast that frustration or annoyance on people. They have less disposable income and are keeping their money in their pockets and we see that going forward into next year as well."
According to statistics compiled by the Society of the Irish Motor Industry (SIMI) , new car sales in
Last year the corresponding figure grew significantly by 11 per cent to 171.732. This year's growth rate is expected to finish up just half of that.
SSIA spending on new car registrations had been lower than expected. However, with the majority of accounts set to mature next May, the true impact of the SSIA scheme on the motor industry's coffers has yet to be felt.
"There wouldn’t be an awful lot of reliance from our side on the SSIAs delivering a great result next year,” said Kennedy. "You could argue that our market is gone at that stage as over 75% of registrations will have taken place."
Murphy said that sales of second hand British imports in the Irish market stood at about 70,000.
“From an industry point of view and from a consumer point of view that may have a damaging effect on new vehicle sales,” he said. “The more used cars that come into
SIMI has been very vocal in their condemnation of this practice, pointing to the unregulated ‘black economy’ of individuals selling used imports from makeshift premises and with no industry regulation.
“There are guys with cars on display on the side of the road and how they are getting away with it I don’t know," said Murphy. "If it was any other business the local council or some government department would be down on them.”
The recent drop in the price of car insurance has, in contrast, helped to boost sales in the Irish motor industry.
“There was a time four or five years ago when insurance costs were the bugbear of an awful lot of people, especially young people coming into the market,” said Murphy. "Certainly the premiums have fallen and personally I think there is scope for them to fall even more."
Green Motoring
The well publicised volatility in petrol prices, combined with government controls on CO2 emissions, means that customers are increasingly looking for ‘greener’ products.
“The environment would be definitely one of the biggest issues going forward in the motor industry over the next number of years," said Kennedy. "It will certainly have a large bearing on they type of cars that are being sold. People will be looking for cars which are more fuel efficient and certainly more environmentally friendly."
In 2005 Ford introduced the Focus FFV model, which runs on a mixture of unleaded petrol and bioethanol. There are now 13 Maxol filling stations nationwide which distribute the Maxol Bioethanol 85 fuel, a dairy byproduct manufactured by the Carbery Group in
“The fuel itself is about 15c a litre cheaper than unleaded,” said Murphy. "The CO2 emissions from the car and the whole process of how the fuel is sourced in the first place is far more beneficial to the environment."
Kennedy said that green-conscious consumers are also turning towards diesel models as a cleaner option.
“We are also growing our diesel sales with Honda’s ‘Whispering Diesel’ engine," he said. "This year diesel has allowed us to grow Accord sales and that is encouraging.
From a CO2 emission point of view they are more environmentally friendly than petrol engines at this moment in time."
Luxury Models
Another trend in the Irish new car sales market which looks set to continue in 2007 is the move towards more expensive luxury models.
“Like everything else in
Kennedy said that younger customers, in particular, are especially drawn towards luxury or premium models, and that they are prepared to borrow to get the car that they want.
“The type of people with the disposable income tend to be the younger people," he said. "They say 'we want our car now, we are prepared to finance it, and we want the latest and greatest'. The higher the specification in the model the more it seems to be in demand."
However Murphy added that, in line with the growing environmental consciousness, consumer demand for larger models is shrinking.
“Personally, I think the days of the big four wheel drive vehicle are drizzling," he said. "They are too big to be perfectly honest. There is a bit of a society backlash which is beginning to gather momentum against them."
Saturday 13 January 2007
E-Banking's New Era
Sunday Business Post - Computers in Business Magazine - Dec 03 2006
More and more businesses are moving the majority of their banking functions online for three reasons: cost savings, convenience and real-time information and reporting. The primary motivation, as with most investments in information technology, is to save money.
“When you add in stamp costs and administration time we reckon the typical cheque would cost €1.20 and the typical online transaction would cost 29c,” said Dermot Nolan, head of business marketing with Bank of Ireland. “If you are writing 150 cheques a quarter, which for most businesses would not be excessive, you would pay your monthly online banking charge immediately.”
The second advantage associated with online e-banking services is convenience. The internet doesn't go home at 5pm, never takes holidays and is always open for business.
“You could be sitting in your kitchen on a Saturday night doing staff payments or making transfers, and obviously the bank isn't open then,” said Nolan.
The third issue where online banking facilities can make a real impact on the efficiency of business processes is in providing businesses with quality information and reliable data, such as account balances, outstanding creditors and overdue debtors, which is right up to date.
“If you only monitor your accounts by monthly statements, 30 days is a long time in the life of a business. The luxury of being able to look up a balance once a week, once a day or ten times a day is seen by a lot of businesses to be cost effective in terms of managing their cash flow better,” said Nolan.
All businesses, ranging from the sole trader to the large multinational, have good reasons to look to e-banking solutions. This includes everyone from self employed individuals logging on a few times a week to check their balances or pay their phone bill, to SMEs using the internet to pay suppliers and staff on a regular basis, to huge organisations trading overseas who have foreign exchange and treasury requirements.
All the major Irish banks and building societies now offer online banking to their business and personal customers.
The names given to the different bank's services are very similar, and there is not a great deal of difference between the different services and facilities either. All the e-banking services have evolved quickly in recent years from basic online account management to more complex services, with features such as international currency dealing and payroll applications.
Real time banking is standard in the e-banking market.
The basic facilities that all the packages available offer the ability to view balances and histories of different accounts (including those in other banks), transfer funds between your accounts, order statements, credit cards or chequebooks, conduct cheque searches and transaction searches, set up standing orders and direct debits and make domestic and international payments.
Most packages also now include more advanced functions. These include exporting information to other applications on the user's PC such as Microsoft Excel, or different more specialised accounts packages and the ability to create payment templates for regular payments which can be put in place once and then react automatically and schedule forward payments up to 90 days in advance.
Another basic level of functionality in the bank's online business offerings is the ability to give different levels of access and authority to employees at different levels.
“You can have as many users as you want, with various levels of access to what they can do'‘, said Barry Manning, senior cash manager with National Irish Bank.
“You can have users who can just view accounts only, other users can go in and create payments, and then other users who can go in and authorise those payments.”
The ability to integrate a business’ e-banking function with various internal accounting and financial packages within a company is also widespread.
This means that as you use the online application to pay bills and receive payments, your internal accounts can be notified and updated in real time, which helps businesses keep track of their cash flow as and when it happens.
“You can generate invoices or files in your accounting system, and directly upload those to the bank from your own desk without having to generate files or fill out any paperwork etc,” said Sean Jevons, head of e-channel development at AIB.
Irish businesses commonly use the internet to pay staff salaries. Most of the payroll software packages on the market at present can be made compatible with the online banking mechanisms.
“A lot of our customers from small, medium and large-scale enterprises would upload payroll files from their own systems directly onto the system,” said Jevons.
“There is no need to re-key them or anything like that. I will upload the file and maybe someone else will check that it is fine, and then it is released to AIB and we will action it for the customer.”
This can have a definite advantage in that the banks can view this salary function as one transaction, with a single cost, but there are maybe 100 credits to accounts, either held by your bank or wherever your staff have their account.
There are a number of individual features which provide a certain amount of differentiation within the Irish e-banking for business market.
The different packages available from the different banks each have their particular extra add-on facilities.
National Irish Bank's ‘Business eBanking' service allows online trading in securities and currencies, get live updates on your currency positions and market value of currencies in your account and see real time news and analysis which may impact on your trading decisions.
“We give every user access to market and currency information. So they look at share prices online and see the current exchange rates. They can also access Reuters online information for free,” said NIB's Manning.
NIB's online offering is also more individually designed.
The facility is divided into different modules that the customer can pick and choose from depending on their particular requirements. NIB uses the same e-banking system as its parent Danske Bank, which is in use
“It is more of a consultation process that takes into consideration what their specific requirements are, we go out and sit down with the customer and design a specific solution for their needs. Then we only charge customers for the modules which they use,” said Manning.
There is also a level of differentiation between the bank's individual packages in relation to cost. Each bank offers a certain basic service for free.
The next NIB package starts at €10 a month and works up depending on requirements. The BOI offerings range €15 up to €70 a month.
AIB charge a flat fee of €200 to all online business customers.
Transaction costs across the banks are generally cheaper if you do it online, however for full breakdown of exact differences you should contact the bank directly.
Signing up and training
All of the banks are eager to get their customers online, as there are also efficiencies and cost savings from their point of view. It is relatively easy to sign up through your own business manager, by visiting a branch, or via the bank's website.
Anyone with an up to date version of their internet Browser (eg Internet Explorer, Firefox or Safari) should have no problems accessing the online banking webpages. Some websites will require particular software patches - for example an updated version of Java - which will be downloadable for free. Windows 98 or later versions is also generally required.
Broadband connections are also a good idea, as waiting for a page to load via dial-up is not an option when you are making important financial transactions. The e-banking packages on offer are not overly complex, and anyone with competency using the internet or basic IT applications should not have too much difficulty banking online. The banks all provide initial training services to customers free of charge and have dedicated support staff contactable by email or phone who can provide assistance if things do go askew.
Security issues are stalling internet banking. A survey of the Irish market, carried out earlier this year by Behaviour & Attitudes for international IT consultancy CA, found that of the 1.4 million Irish adults who use the internet, almost 10 per cent (125,000 people) claim that they do not carry out transactions online due to worries over identity theft.
All banks take e-banking security issues seriously. There is a detailed set-up process, which generally involves both online and offline elements.
Each user will have a set of personal authorisations (ie username IDs and passwords) which will allow only the level of access which the individual is permitted.
With this login users can typically access some parts of the facility, but will not be able to move large amounts of money around. Further, stricter, measures are put in place such as extra software installed on your individual PC.
“To go and make a transaction you need a digital certificate, which sits on your PC, so if a customer was foolish enough to give their username and password to somebody else that person would be able to view the account online, but unless they were actually using the PC that has been allocated to make transactions they actually can't do any damage in terms of withdrawing any money,” said BoI's Nolan.
AIB have recently introduced an extra measure to heighten the security of their iBusiness Banking (iBB) package. Each user gets a new piece of hardware, which looks like a calculator, which sits on their desk and produces a unique code or token which is traceable to them each time they carry out a transaction.
A lot of the negative publicity around internet banking has focused on phishing. This is a scam used to gather information from unsuspecting customers, usually in the form of an e-mail redirecting recipients to a fake website where they are asked to enter bank details.
Users should never confirm account details in an unsolicited email. They should also ensure that all transactions take place on a secure server where the web address is https://, and a padlock icon is visible in the corner of the browser frame.
All the banks are well aware of the perils of phishing.
“We have our own security software called E-safe Key which is built into the system.
“We recently upgraded it specifically around the phishing issue which has become more prevalent recently,” said Manning.
None of the banks can see any huge advances in e-banking options, as almost everything you can do in a branch you can now do online.
The innovation is going to come in informing and explaining to businesses how they can extract most value from the existing e-banking solutions.
“We have a module in our system called Collection Service which is used at present mainly for direct debit collection, but it also has the ability to be able to outsource invoicing to the bank so that customers, rather than printing off reams of invoices, enveloping them, putting stamps on them and posting them out, can avail of that functionality into NIB,” said Manning.
Using your e-banking solution to gather and collate data is another possibility for businesses. Full integration with your internal accounting systems can reap many potential benefits.
First Time Buyers Mortgage Options
Sunday Business Post - November 26
First-time buyers should do as much research as possible before deciding which mortgage product to choose, and enlist the assistance of a knowledgeable and informed mortgage broker or expert.
“The most important thing from a first-time buyer’s perspective is to make sure that they are getting a complete overview of the market and all the products available to them,” said Mark Purcell, Sales Director with A Better Mortgage in
The first thing that a mortgage broker will discuss with a potential customer is the amount of money which it will be possible to borrow. A number of different factors affect this figure. These include the individual or couple’s salary, their savings, the term of the mortgage, the type of interest rate, and their prior credit record.
“Brokers and lenders will try to ensure that the customer is bringing a clean credit history. Other issues would be other debt they are servicing, specifically short term debt, car loans, credit card borrowings etc,” said Gary Prizeman, Head of Sales at ICS Building Society.
While most banks use similar criteria, it is important for customers and their brokers to explore all potential avenues to secure the best deal. Purcell says that different banks assess a customer’s ability to repay the loan in different ways.
“Most of the banks look at somebody’s net disposable income. They will take a certain percentage of that in an environment where interest rates are 2% higher than the current standard variable rate. However some banks will look at it on a 3 year fixed basis, which enables somebody to borrow that little bit more,” said Purcell.
Mortgage providers offer a number of different interest rate mechanisms over the term of the loan, which can have an effect on the monthly repayments. The concepts are ‘Fixed Rate’ – where for a set period of time, typically up to three years, the repayments do not change. ‘Variable Rate’ mortgages move roughly in line with European Central Bank interest rate changes, while ‘Tracker Rates’ are a combination of the two, and move in relation to ECB rates, but within certain margins.
“It is really down to somebody’s attitude towards risk. We are in an environment of increasing interest rates at the moment. You are going to pay more for a fixed rate, but you are buying comfort and peace of mind,” said Purcell.
Once customers have worked out how much it is possible to borrow, they can decide on whether to take out a 100% mortgage, or whether it might be possible to use funds from other sources, such as savings or family assistance.
100% mortgages are a relatively new product on the Irish market, and have been introduced primarily because of the continued high rates of house price growth in
“The difficulty for customers who are renting and trying to save for a deposit was that property prices were continuing to increase and it was taking them longer to get their deposit. Now they don’t need to, the 100% allows you to get onto the property ladder faster,” said Niall O’Grady, Head of Marketing with Permanent TSB.
Given the state of the property market at present, for many customers, especially individuals attempting to buy on their own, some kind of financial assistance is required.
“More and more, particularly first-time buyers are being supported by their parents. Not just going guarantor, but actually presenting their offspring with monetary gifts which they put towards their mortgage purchase,” said Prizeman.
There are potential Capital Acquisitions Tax (Gift Tax) complications to these gifts. A threshold of €478,155 applies to gifts/inheritances made by a person to his/her child, however for other family members such as brothers, sisters, nieces or nephews the threshold is only €47,815. Any gift over this amount is taxed at 20%.
As the Irish mortgage market is so competitive at the moment, financial institutions are constantly vying for the customer’s attention, and one way of differentiating themselves is to offer enticing flexible features and introductory offers.
Such flexible features can include very low fixed rates over the first few years of the mortgage, the possibility of taking repayment breaks, skipping a set month every year, the ability to overpay or underpay at certain times or to reduce or increase the term of the mortgage going forward.
However, Purcell counsels that the most important factor remains the total cost you will pay at the end of the day.
“What people have to look at is the overall deal. A mortgage isn’t a two year product, it is significantly longer. There are introductory rates for one year or even two years in certain cases, but people should look at what happens after that,” said Purcell.
“Does taking a discount product disqualify them from taking cheaper variable rate products later? Also just because someone has the cheapest discount rates on the market doesn’t mean that after the initial period they have the cheapest solution over the long term,” he added.
Stamp duty is another important consideration for first time buyers, and one that can add a significant cost to the total purchase price of a property. At present, first-time buyers are exempt from paying any stamp duty on the first €317,500 of the purchase price. After this amount there are rates of 3%, 6% and 9% as the total price tops €317,500, €381,000 and €635,000 respectively.
Although there has been a lot of press coverage recently over possible increases in these stamp duty thresholds in the forthcoming budget, those in the business aren’t expecting any fireworks on budget day.
“There have been some talks about changes to the stamp duty regime in the forthcoming budget, but we wouldn’t expect any significant changes,” said O’Grady.
Once you have decided how much money you have to spend, your mortgage broker or financial institution can look to secure mortgage approval for that amount. Then, and only then, is it time to start looking seriously at the location and type of property which you are able to purchase.
“We would always say to somebody to get their approval first. People generally know their budget then, and then they can go out and look at properties and locations where the can afford to buy. That saves lots of money in shoe leather, pounding pavements and looking at houses that they just won’t be able to afford to buy,” said Purcell.
After the customer has found a property that they wish to purchase, and has secured approval for the amount they wish to borrow, there is a good deal of paperwork to get together. At this stage customers enlist the services of a solicitor who should look after all the conveyancing issues.
It is important for first-time buyers to shop around when choosing a solicitor. Some solicitors can charge up to 1% of purchase price of property. If you are buying €450,000 house, this means a cost of €4,500 plus vat plus outlay. An option is to work with your broker, who may be able to arrange single price conveyancing at, for example, €850 plus vat.
There are also supplementary products which a mortgage holder must also bear in mind. House insurance is generally required by the financial institution, while anyone under 50 years of age must take out mandatory mortgage protection cover.
Given the complexity and additional issues involved in deciding on the right mortgage product and going through with the property purchase, not to mention the other concerns involved with choosing the right property and physically moving house, it is a good idea for purchasers to surround themselves with the best possible advice.
“Emotionally buying their first home is a very traumatic time for customers; probably the biggest potential transaction customers have in their life. So it is vital that they go to a provider who has good experience of handling first time buyers as they tend to know the things that can go wrong and they can advise customers how to avoid them,” said O’Grady.
Jargon guide: (source IFSRA)
APR This stands for annual percentage rate - the annual rate of interest charged on a loan. It takes account of all the costs involved over the full term of the loan, such as any set-up charges and the interest rate. It provides a good comparison of costs between alternative loans.
Stamp Duty This is essentially a document tax payable to the government on the purchase and mortgage of a house. Various rates apply, depending on the size, purchase price of the house and the status of the buyer.
Collateral Term used to describe security for a loan - usually an asset such as an existing property or investment policy.
Conveyancing Technical term for the legal process of buying, selling and mortgaging a property.
Debt Consolidation Also called 'wrapping up your debt' - refers to the practice of taking out one single loan (mortgage) to pay off various individual loans.
Business Gets Clever
Sunday Business Post - Computers in Business Magazine - Nov 05, 2006
The roll-out of business intelligence (BI) has the potential to make far-reaching changes throughout all businesses and organisations, with data management being just the very beginning of what it can do.
“Put very simply, business intelligence gives you the information when you need it, in the form that you need,” said Michael Kearney, recently appointed country manager with SAS Ireland. “What organisations are trying to do when they invest in BI is to improve their decision-making capability.”
A major reason why business intelligence is appearing on more and more radar screens now is the explosion in the quantity and complexity of data that people at all levels within organisations have access to.
“The reason you have to look at BI now more than ever is the sheer vastness of the amount of data that is out there. Data is basically doubling in volume every 18 months, or even less, and it has just gone beyond human capabilities to look for trends and nuggets of information in that volume of data,” said
“The challenge is to integrate data from multiple sources and allow the business to deliver self-service reports and business analysis.”
BI tools are fundamentally about using data which an organisation already has - whether in databases, CRM systems, financial and accounting packages, ERP systems or elsewhere - and being able to organise this data in such away that decision-makers, at all levels of an organisation, are empowered and informed with useful knowledge which can be used to make decisions all across an organisation.
“The information which you get out could have a dramatic effect on the business.
“For example, you may understand your cost base better, or your customer base. You may understand how to cross-sell and up-sell better. You may understand your risk exposure better. Based on that information, managers are then in much better positions to make business decisions,” said
One of the most pervasive and basic BI tools on the market today is found in almost every office in the country.
“Excel is absolutely the key base platform that many people will use to provide business intelligence in their companies,” said Richard Moore, business group manager, server and tools, with Microsoft
“If you think about the number of people who use it for ad hoc reports, analysis, decision-making, presentation purposes - it is a focal point for a lot of first use of BI in organisations.’' According to
In April 2006 Microsoft acquired leading US BI concern ProClarity, gaining access to their market leading advanced analytic and visualisation technologies, which will feature heavily in the new MS Office 2007 release.
“The 2007 Office will feature a new product called Office Performance Point, which basically gives you, in one place, the ability to do graphical analytical overviews of any particular business issue that you want to monitor,” said
“So if you want to do business score cards you can, if you want to do visualisation of data to really understand under the hood what is going on, you can. The smart thing about this is that you can view the output in Excel, you can view the output on a webpage or you can create a point of integration so that other applications can get that output and present it using other tools as well.”
SAS and Microsoft, of course, are only two of a large number of organisations who are moving quickly to colonise the BI space. On the international stage these include SAP, Business Objects, Cognos and Oracle. Indigenous Irish IT service providers such as Datapac and Sage also offer BI packages.
According to John Caulfield, solutions director with Oracle
“People find that when they implement an ERP system they have far more information and data about their business than they had before. They are now beginning to move from a focus on efficiency, to trying to get insight and visibility into the information that they have,” he said.
While businesses have generally been running a number of fragmented applications which can be loosely termed BI, they are now looking for a joined-up package.
“People have been doing ad hoc BI implementation over the last number of years. Buying a standalone report writer, putting it over a silo data storage system, being able to get reports,” said Caulfield.
“What we are seeing people beginning to ask now is how to build BI into our applications in the first place.
“How do we effectively make it pervasive so that we have not just analysts using the information but any user throughout the system? How do we start using that information then to give us an insight-driven business, rather than just the historic information reporting?”
A BI solution will usually include a ‘data-warehousing' capability, where all the data which an organisation has collected and gathered in different places can be gathered together, organised and structured. This immediately poses a challenge as data taken from disparate sources will not always be readily compatible and capable of being sorted into reliable categories which are useful and consistent.
Integration is therefore an important challenge in any BI implementation.
“You have to make sure that if the customer is John Caulfield, you have the same John Caulfield throughout all three applications, or that John Caulfield isn't J Caulfield in one system, John Caulfield in another and Mr Caulfield in a third,” said John Caulfield.
This requires a certain amount of planning within your organisation. All departments must agree on a set of criteria that will work right across the different areas of your business. This includes clearly defining what you mean by all business terms and processes.
“When you are taking data from the multiple systems into a data warehouse it is a matter of applying rules. Users can define their own rules and policies that will check for duplicates, that will check that the information is consistent,” said Caulfield. It is also important for all stakeholders within the business to sit down and work out in advance what it wants its new BI tools to do.
As with any investment in information technology, the organisations that get the best return are those who set out clear objectives before embarking on the project.
“If a company doesn't know what its key performance indicators are, what its goals are, what it needs to measure, to drive their business at any level or at every level, then they will never get a return on any investment in BI, whether its an investment in the process, or in technology,” said Jayne McCormac, director of management information systems with Sage.
Once a BI tool has collated and organised the data into useful categories, it can then produce reports which give managers and decision-makers easy access to key trends and indicators in all areas of their business. A huge variety of different reports can be ordered and delivered, depending on what the end-user wants to discover. Different users at different levels across an organisation can access information that is directly related to them.
“There are different types of BI tools and they would be aimed at different types of people. An analyst whose role is to really drill into the information and understand the drivers that are driving the business might use a more sophisticated tool than a person who is running an accounts payable department,” said Caulfield.
Correctly implemented, business intelligence allows information to trickle down efficiently through an organisation and reach those who need it most when they need it.
Where once a team leader or project manager would have to wait for a weekly operations meeting to see how a particular project or process was progressing, most BI systems allow users to go in and access information at any given moment to receive a snapshot of exactly how the project they are involved in is faring.
“What you typically see is that there is a much better understanding inside the company of the key issues and people are able to make decisions faster so processes that previously would have relied on a manual submission of a report once a week don't need to wait anymore because people can run a report effectively in real time,” said Moore.
This allows any kinks or problems to be highlighted at an earlier stage. This freer access to information can also lead to the development of interesting new relationships and synergies between different arms of an organisation, who previously would rarely have come into contact.
“It is easier for people to find out what is going on without having to depend on a third party to give them access to information. We have seen that if you are running a marketing campaign, or looking at the performance of a business unit, you start to see issues and comparisons across different products and business units that you wouldn't have seen before, simply because it would have been too cumbersome to get that kind of information,” said Moore.
As well as providing decision-makers with the information they need to make quick, informed decisions as part of their daily work schedule, BI reports are also used at a strategic planning level within organisations.
“It gives a very rich comprehensive ability to probe and try and understand why is something happening the way it is,” said
The strategic planning potential of BI can be utilised in organisations of all sizes and within all sectors. “SMEs use business intelligence to look at business strategy, using it for competitive information, to build profiles of what is working, what is not working, what might work, so they are using the information more in a strategic way rather than just an operational way,” said Frank Corr, commercial director with Datapac Business Solutions.
The information gleaned from BI reports can also be shared with your business partners and the results can be mutually beneficial. This is particularly apparent at the SME level, where businesses must work closely with suppliers and customers.
“You can build a better relationship with the other stakeholders in the business by sharing information with them and making them a part of a wider community to help drive the business forward,” said Corr. “The biggest return that we have seen in terms of BI implementation is where you are sharing data between suppliers and customers, it helps them to hone their processes and better understand the relationship.
“If you can share data back to them about how the relationship is working or not working from your point of view, they can take that on board and modify their processes to better serve you.”
The reports generated by BI systems can be particularly useful for organisations operating in sectors where there is a responsibility on businesses to keep accurate and detailed records of all dealings and transactions.
“Monitoring internal controls and being able to prove to the stock exchange or the government that you are in compliance with the laws and regulations and best practices of the land are all progressively more important. “Auditing of information has quite a high reporting implication which BI can meet,” said Caulfield.
The latest BI tools tend towards a graphical, intuitive interface or dashboard, which is accessed via a web-based interface, and no technical expertise and minimal training is required for the end-user.
“The benefit of BI tools is that they provide a simple, almost familiar experience to the end-user,” said McCormac.
“There is no point in having something that looks almost mathematical in front of somebody who wants to look at some kind of trend analysis in terms of their customers' payment.”
Google recently agreed to work closely with SAS in the development of their BI products. Google's OneBox for
“For example, if you type in Q4 sales figures, it would also tell you what the top-selling products are, the top sales people, or perhaps the top customers for that period. It gives a lot of power and a lot of information to an individual through a very familiar and user-friendly front end.”
The different utilities and synergies around BI mean that BI tools now have the ability to impact on the daily routines of employees at all levels within an organisation. However, some observers argue that we have yet to see its potential fully realised.
“From a technology point of view the tools are getting better and more accessible so I would see more and more emphasis going into usability.
“We've got the web, we've got the scale, we've got the convergence of querying and reporting and into analytics. So everything is there, the final piece is to push that out so that users can utilise these tools at every level in an organisation,” said Corr.
“Going forward, business intelligence will be seamless.
“People will be using it to make fact-based decisions on a daily basis, hourly basis, and people won't even realise they are using it,’' said McCormac, who likens the impact that BI will have to that of e-mail and the internet.
“I think in three years time everybody will be sitting in front of a desktop and as well as having their financial application, mail client and internet they will have their business intelligence application open.
“Everyone who is touching any information will be using their business intelligence application to make the most basic of decisions,” she said.
http://archives.tcm.ie/businesspost/2006/11/05/story18638.asp
Protect Against Currency Fluctuation
Sunday Business Post - Nov 19 2006
All businesses involved in international trade, both importers and exporters, have a responsibility to protect themselves from the potentially negative impacts of currency fluctuation.
‘‘Currency fluctuations can make a significant impact on a business’ profits,” said Niall Duggan, head of FX sales with Bank of Scotland Ireland.
‘‘For example, dollar exchange rates can typically move one per cent within a day. If you are in a low margin business, this can make a difference to your profit margins.
“Hedging your currency risk is something that most people, whether they are importing or exporting, should be doing as a matter of course.”
The two main options available to help businesses manage these risks are forward contracts and currency options.
Forward contract
‘‘The most important and most used is a forward contract, used for 98 per cent of all currency hedging,” said Paul Fleming, treasury specialist with Bank of Ireland Global Markets in Dublin. ‘‘It is the simplest product and there is no cost associated with it. If used in the way it is intended to be used it is a brilliant product.”
A forward contract allows a company to set the exact exchange rate they will pay on a transaction, even if this transaction is to be completed some time in the future. The cost to the customer is zero, and the bank agrees to take on all the currency fluctuation risk involved in the transaction.
For example, a company may export a product and agree to receive payment in three months time of $200,000. If the dollar/euro exchange rate is 1.25 per cent, they will receive €160,000.
However, if the rate has risen during the three months to 1.29 per cent the company, will receive €155,000.This could have a serious effect on the business’ bottom line.
With a forward contract, agreed with a treasury specialist, the company can set the rate at 1.25 per cent in advance.
They will receive the agreed sum of €160,000 in three months' time. The risk will have been passed on to the treasury specialist.
Of course, exchange rates can also move in the other direction.
Agreeing a forward contract removes any potential gain from the currency fluctuation for the exporter. However, Duggan argues that in the vast majority of situations, it is better for the exporter to take a step back.
‘‘A business is in business to make profit, from making widgets, for example. It knows that part of its activity very well.
“Foreign exchange is a different world, a different market, with many different factors affecting exchange rates. Most businesses can’t second guess the market. They are better off to stick to their knitting, so to speak,’’ said Duggan.
Currency option
Another package, aimed at protecting importers and exporters from currency fluctuation, is the currency option.
This is similar to a forward contract, however the customer now pays a fee to give them the opportunity to take advantage of any favourable movement in the exchange rate.
‘‘A currency option is almost identical to a forward contract, the only difference being that you can pay a premium on it for the ability to walk away from it. The reason you would walk away from it is that if in three months time the rate goes down to 1.21 you can deal at 1.21, but for that flexibility you pay a premium,” said Fleming.
Managing risk
Both the currency option and the forward contract are available in nearly every traded currency, and work equally well whether a company is primarily an importer, exporter, or both.
Knowing in advance how much you are going to receive in any business deal is a fundamental to most businesses; hence the popularity of the forward contract.
‘‘With a forward contract you have certainty. You know what a consignment is going to cost you in euro terms, so you can price outputs accordingly to achieve the profit margins you would like to achieve,” said Duggan.
It is possible for businesses to use currency fluctuations to their advantage, while simultaneously protecting themselves from any risk. One tactic is to purchase your hedge at the right time. Businesses can work closely with dealers to pick a favourable moment.
‘‘Clever customers are buying their cover opportunistically.
“If you look at exchange rates, they tend to move within ranges over periods of time, and clever customers would actually be buying their hedge at the optimum moment in the cycle,’’ said Duggan.
Fleming warned against individuals or businesses trying to be too clever by playing the market without the necessary knowledge or skills. Even qualified economists are unable to predict currency fluctuations with certainty.
‘‘The single most important thing that customers can do is to talk to their currency dealer.
“We can assess the risks that they have and then prescribe a solution. We try to look at each customer’s requirements separately and give them a more tailored solution,’’ said Fleming.
Virus Prevention Better Than Cure
Sunday Business Post - Computers in Business Magazine - October 2006
While people are aware that they must keep their PCs and networks protected from viruses, the fact that virus-writing is now a multi-billion-dollar industry may not be as well known.
“The people who are creating these viruses are in business, and unfortunately the business they are in is an illicit one,” said Tom Gillis, senior vice-president of worldwide marketing with a
The idea of the rogue programmer writing viruses as a joke or publicity stunt is well out of date.
“Basically the people that propagate these viruses are business people,” he said.
“They have the resources to hire professional engineers that can develop this stuff, so the level of coordination that we are seeing now is very significant.”
Time is now the most important factor in combating virus threats. Ten or 15 years ago viruses were primarily passed on slowly from machine to machine by floppy disc. The global growth of the internet and other communication technologies means that a virus can be released at nine o'clock in the morning and shut down systems all over the world by lunchtime.
“What the virus writers are exploiting is the reaction time,” Gillis said. “For all of the various anti-virus companies, the reaction time is measured in hours or sometimes days. And in that interval the viruses propagate around the world without any kind of defences or mechanisms to slow them down. Virus writers are designing viruses to last for 12 or 24 hours, and that is all they need.”
All Irish companies and organisations need to be prepared and have up-to-date solutions that can deal with the very latest dangers. Acting after you have been hit by a virus attack is not an option.
“We need companies to see the threat,” said James Finglas, sales director of MJ Flood Technology, which provides ICT solutions to Irish SMEs. “There is a bad taste left in the mouth if we are charging them to clean it up.
“We would much prefer they put in a solid platform that protects them from threat in the first place.
“But typically in the Irish market, a lot of companies might think that there is a lot of hype generated around this area, and it is not until their business is brought to its knees that they realise that it is a very serious threat.”
Finglas gives the example of an Irish SME which called in MJ Flood last year when it suffered a virus attack after its out-of-date virus protection software failed.
“This company had four offices with 50 users and they were down for seven days,” said. “The total bill for cleaning, with four engineers from here, was in the region of €27,000.”
These are the hard costs that were involved in physically cleaning up the problem.
Soft costs, such as lost productivity, stolen data and customer information, lost trust from customers if the outbreak is made public, time spent by IT support staff and so on can be far more expensive and damaging.
There are many different types of viruses out there. Traditional viruses attacked a machine or network and shut it down completely, deleting system or data files, often requiring a full re-install of each application and programme on all machines.
Newer ‘blended' threats, propagated by e-mail and over the web, include worms, spyware and malware such as Trojans and zombies. The latter come in and take over a machine, often automatically connecting to a rogue server to pull down malicious content or sending further e-mail to everyone in an address book to continue to spread the virus.
Other viruses are merely hoaxes, which waste users' and tech support teams' time.
While Microsoft Windows users are most at risk, viruses can also target anybody using a Mac, Linux or other system.
Viruses can enter into a company in many ways, including through unrestricted e-mail use, contaminated memory sticks, flash or USB drives, or through a network or server. Another increasingly common gateway for viruses is conscious or accidental visits to unsavoury websites.
“We are seeing more and more on the internet rogue code being streamed down to the user,” said Sean Reynolds, managing director of Rits, a leading Irish information security consulting and professional services provider.
“When they browse a site, something comes down and they either say yes or it just happens automatically.”
However, spam remains the number-one risk to companies.
The concepts of spam and viruses are intertwined.
“The vast majority of viruses are designed to send spam,’' Gillis said. “The people who are writing spyware are using spam to deliver more viruses, which then go and infect machines with spyware.
“These threats are related, so putting together comprehensive solutions is a real challenge for the IT team: to be educated on the different threats and understand the different solutions out there.”
It may not be apparent automatically that a virus has been downloaded onto a PC. A worm, for instance, can sit quietly on a machine until it is triggered by an action by the user, such as loading an application or hitting a particular key, or by a point in time.
Some virus writers go for a big bang effect, such as wiping out your entire system, whereas others are more discrete, but still very damaging.
“There was a very nice virus, which went around modifying Excel spreadsheets. Everywhere it found an eight it made it a nine and everywhere it found a nine it made it an eight, which is very subtle because it could be months before you realise you have a problem,’' Reynolds said.
While these virus threats are real, Irish companies and organisations have many options to protect themselves.
There are a huge number of anti-virus programs and applications on the market. Some provide a general off-the-peg package which aims to protect against all threats; other providers offer a more tailored solution. Managers have to decide which one suits their particular requirements and circumstances the best.
The most well known anti-virus brands in the international market are Panda, Trend, Sophos, Symantec (formerly Norton), F-Secure, McAfee, Computer Associates, RAV, Microsoft, Kaspersky, AVG and Central Command.
These anti-virus programs scan all incoming web files, email, attachments and downloads, as well as files accessed from a server, network, drive or disk. If they find a threat, it is isolated and killed. Each programme is constantly updated to ensure that, as far as possible, they can meet all the threats that are out there.
Most traditional anti-virus packages work on a signature based system. This means that once a virus is released and noticed, programmers employed by the software companies immediately being working on a cure. As soon as they are successful, the ‘fingerprint' or ‘signature' is uploaded onto their website in the form of a patch, from where it can be downloaded by the software installed on each user's system. Once you have the patch on your PC, it will notice any file containing the signature and eliminate it, keeping you safe.
However, if the virus gets to you before you have downloaded the patch, you are in trouble.
“The most important thing is to have a reliable anti-virus product which is updated regularly,” said Reynolds. “By regularly, I would personally have it checking every hour, and as a minimum downloading updates daily.”
There is a move under way within the anti-virus market towards more pro-active systems which aim to detect the effects of viruses without having to depend on recognising a known signature. These are ‘behaviour-based' systems, which predict what a virus might make your system do, recognise this unusual behaviour, and shut down any system that starts to act in unusual ways.
“Behaviour analysis looks for bad behaviour on a system,” said James McLoughlin, senior security specialist with Eircom subsidiary Lan Communications. “For example, if it sees that someone is trying to delete some important files on your system or make an outbound connection across the network that would never have been seen before, it will flag that as being unusual behaviour and block it.”
These newer systems can therefore protect against new viruses immediately, and cut out any time lag which may prove problematic. All main anti-virus brands are introducing behaviour-based functionality into their solutions.
Many SMEs choose an all-in programme from one of the major providers that suits them. Finglas estimates the installation costs for an SME with a 15-user network for a typical anti-virus package at about €2,500,with a yearly subscription covering updates and support of about 65 per cent.
Larger organisations may have more complex requirements, and go to an outside service provider to design an individual anti-virus solution, made up of more than one level of protection.
“People in the enterprise space see the value of getting something which is specific to their environment and can take account of the myriad of problems which they would typically have,” said Reynolds.
Protecting networks from viruses is part of the challenge, especially for larger organisations who may have very complex systems, including wireless Lans and Wans.
Each element within a network must be sealed and protected, so if a virus does get in, the game is not completely up.
“We wouldn't see protection against viruses and worms as being one product,” said Karl McDermott, system engineering manager for Cisco Systems Ireland. “We would see security being in every single element of the network and the architecture that we have built - what people have termed a ‘self-defending network'.”
Network and server vendors are introducing products which also incorporate ‘behaviour-based' functionality.
“We have developed a behavioural-based intrusion prevention system called Cisco Security Agent (CSA) that sits on the end devices in conjunction with the anti-virus software,” he said. “You don't have to wait for a signature, we understand the way that PC works normally and, once we start to see it doing strange things, then we realise there is an attack and stop it at source.”
This is especially important in large organisations that may have thousands of machines and devices to protect.
“In a world where you have viruses coming out every single day, and updates and patches to get around those viruses, IT departments could in theory spend their entire time just updating the Microsoft releases on the PCs, but the CSA product gives customers the ability to plan when they are going to upgrade their software,’' McDermott said.
“They don't need to do things reactively, they can proactively say we will patch all our machines every month because CSA will protect us.
“People now carry and use laptops and mobile devices everywhere in the outside world (at home, with clients, abroad) using both traditional and wireless Lan connections.
“Companies must ensure that staff returning to the office carrying unwanted viruses are quarantined until everyone is sure they are uninfected.
“More people are out and about and they can pick up things and bring them back into an organisation. So another element to the self-defending network is a thing called network admission control.
“This is built into the switches in the network, so when you come back the first thing the network will do is check your PC to make sure you have the latest patches and your signatures are up to date.
“And if they're not, it will put you into a quarantine area and stop you getting access to the full resources of the corporation.”
Given the potentially devastating consequences of an all-out virus attack on a large organisation or enterprise, it is vital to ensuring that all your machines, servers, networks, devices and applications are working together to keep you safe. Larger companies tend to go for anti-virus solutions which include all aspects of their business.
“We design the security in the network the same way as you might design the wiring plan in a building,’' McDermott said. “The security is inter-built into absolutely everything and it is all connected up. It is one security system with multiple layers of security, so if a virus gets past one thing there will be two or three more layers there to stop them getting into the network.”
Just as important is to protect your own network from threats arriving with outside people coming into your own organisation.
“Nowadays, a lot of people are opening up their networks,” McLoughlin said.
“You may have contractors coming on site with laptops which you have no control over, but you want to protect your assets from what they might potentially be bringing onto the network. You may also feel obliged to protect those guys from anything you are connected to.”
The individual user also has to be protected while he or she is out of the office. Personal firewalls can be incorporated into the anti-virus mechanism on a laptop.
“A personal firewall says that while I am connected to an untrusted zone, which might be the internet or a wireless access point at the airport or in a coffee shop, I won't allow any inbound traffic, and any outbound traffic must be authorised by the user,” said Reynolds.
Smaller communications devices such as PDAs and even mobile phones can also be attacked by viruses, and once infected these can carry a virus back into the rest of your network.
“The viruses evolve as the technology evolves,” McLoughlin said. “There are some anti-virus packages that have been developed for the Palm operating system.”
While companies are investing heavily in integrated solutions to protect themselves, the most important factor of all in insuring against a virus attack can be neglected.
“Your first line of defence is always going to be human because the people who are creating these viruses are also human,’' Gillis said. “Having an intelligent set of human eyes that can look at anomalies and adapt network defences is the key.”
Most viruses are still spread because someone clicks on an attachment they shouldn't, or visits a URL that is not safe.
Staff training and education is vital for protection.
“In a utopian world where everyone knew what to watch for, you would probably satisfy 80 per cent of your requirements,” Reynolds said. “The reality is we are probably the other way around. 20 per cent of people are clued in.”
Regular staff training and ensuring people are aware of threats is required, as is a sensible internet usage policy.
“It is very much about teaching the staff of the threats that are posed,’' Finglas said.
“And then having a defined policy that discourages usage which reduces the potential risks posed to the company.”
http://archives.tcm.ie/businesspost/2006/10/01/story17558.asp
