independent

Wednesday 23 April 2014

The year in technology: Hacking, spying, taxes & takeovers

Google HQ, Dublin 2
Google HQ, Dublin 2

From spying scandals to positive jobs news, Adrian Weckler looks back over an eventful year.

It was a good year for jobs in multinational technology firms operating in Ireland. Both Twitter (100 new jobs) and Facebook announced significant expansions in Dublin, with Facebook (which passed through the 500 job mark) switching to a building that can accommodate up to 1,000 people.

Hundreds of jobs came through small IT and web firms such as Dropbox, SQS and Airbnb.

Other incumbents also added jobs, with Microsoft announcing 95 new positions and Google adding a new convention centre to its Dublin city base.

Meanwhile, Intel raised the stakes for Irish IT engineering, with the announcement of a new chip to be fully designed in its Irish facility.

The ‘Quark’ range of processors are to power Intel’s next big computing push, focused on the ‘Internet Of Things’.

TELECOMS

IT was a year when Irish internet speeds jumped and SMS collapsed. In June, 3 Ireland’s owner, Hutchison Whampoa, agreed to purchase O2 Ireland from debt-laden Telefonica for €700m, possibly rising to €800m. The deal, which would see O2 and its assets rebranded as 3, is still being assessed by the Competition Authority.

If successful, the deal will see 3 jump into second position in the Irish mobile industry, with at least 36pc of the market.

Meanwhile, Eircom entered the fibre broadband market in a bid to compete with cable television and broadband operator UPC. Eircom launched services promising speeds of ‘up to’ 100Mbs over traditional customer landlines.

The company recently upgraded its promised national coverage footprint to 1.4 million Irish homes and businesses.

Not to be outdone, some mobile operators launched the cellular equivalent of fibre broadband in the format of fourth generation (4G) mobile services. Meteor was the only operator to launch a full data and voice service, while Vodafone launched a data-only 4G service. O2 and 3 Ireland deferred their 4G launches until 2014. 4G allows smartphones, tablets and USB dongles to connect online at speeds of over 20Mbs.

CONTROVERSIES

Apple’s questionable tax affairs in Ireland

THIS was the year when Ireland became caught in the crossfire of investigations into the tax affairs of some of the world’s largest technology companies.

In May, the US Senate revealed that Apple paid as little as 2pc tax in Ireland on billions of dollars of revenue logged through its Irish operations.

The US Senate probe also revealed that up to €20bn channelled through Ireland attracted no tax liability whatsoever. Taoiseach Enda Kenny and the Minister for Foreign Affairs Eamon Gilmore were forced to deny that the Government had any “sweetheart deal” with Apple on its tax affairs here.

US uses Facebook to spy on Europe

The year’s other big controversy came when a US intelligence IT contractor, Edward Snowden, revealed that the US security services had engaged in mass surveillance of global citizens’ internet communications.

The surveillance operation, called Prism, involved infiltrating popular online services, such as Facebook, Gmail, Hotmail and Yahoo.

The revelations, published in June by ‘The Guardian’ and ‘The Washington Post’, forced Snowden to seek asylum in Russia.

The consequences of the revelations are still being felt, with the European Commission warning that it would revoke some trading privileges for North American multinationals in Ireland and the rest of Europe if the US did not change its practices.

Online shoppers get completely hacked off

November saw the worst ever hacking attack to affect Irish online shoppers. A Clare-based firm called Loyaltybuild was hacked, exposing the credit and debit card details of over 80,000 Irish people.

The incident, which is still being investigated by the Garda Bureau of Fraud Investigation and the Office of the Data Protection Commissioner, also affected the non-financial personal data (such as people’s names, addresses and emails) of up to 1.5 million European citizens.

In Ireland, the worst-affected online shoppers were customers of SuperValu, 70,000 of whom had their details exposed.

AXA and the ESB also saw customer details exposed, 8,000 and 6,800 customers respectively. While two banks (AIB and Permanent TSB) said that fraudulent activity attached to the victims’ accounts had occurred, there were no indications of significant losses by customers.

NEW PRODUCTS

Google Glass

Despite still not being available to purchase, the most-hyped tech product of the year was arguably Google Glass, the eyewear that lets you take photographs, get directions and get email via an under-lens projector.

Samsung Smartwatch

2013 was tagged as the year of ‘wearable tech’. Most attention was focused on Samsung’s Galaxy Gear smartwatch, a prototype touchscreen device that can use apps and make or take calls through a connection with your phone.

iPhone 5S

Apple’s biggest launch of the year was its high-end smartphone, the iPhone 5S. The device features a better camera, a fingerprint reader and a faster chip.

Despite the lack of a larger screen, global demand has soared, with limited availability in Ireland.

WINNERS AND LOSERS OF 2013

Winners

1 Twitter

The world’s second largest social media network, which announced 100 new Dublin jobs in October, filed for a €13bn stock market IPO.

2 Stripe

The online payments service created by two young Limerick brothers (the Collisons) has won global customers and is now valued at €1bn.

3 Snapchat

The newest social messaging platform has spread like wildfire among teens, leading to a (rejected) €2.3bn bid from Facebook.

4 Streaming

Netflix (online video) and Spotify (online music) soared in 2013, adding millions of customers and heaping more pressure on DVD and CD makers.

5 Bitcoin

The cyber currency that economists sneer at grew more than 1,000pc in value as central bankers acknowledged its potential value.LOSERS

Losers

1 BlackBerry

The vintage smartphone outfit went through yet another series of death throes after its new models flopped.

2 SMS

The texting technology fell 22pc in Ireland this year, as phone users gradually switch to free online rivals such as Whatsapp and Snapchat.

3 Daily deals services

Websites such as CityDeals and LivingSocial shrank in popularity this year as retailers and customers retrenched.

4 Ask.FM

The social media website was the target of criticism after revelations of teenage bullying.

5 PCs

It was another year of falling sales for desktop and laptop PCs, which fell by more than 10pc for the second year running.

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