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    HostGator web hosting review: Good performance, bad security, upsells everywhere

    If you’re looking for a web hosting provider, you have a tremendous number of choices. In my Best web hosting providers for 2021, I looked at 15 providers who offer a wide range of plans.
    To get a better feel for each individual provider, I set up the most basic account possible and performed a series of tests. In this article, we’re going to dive into HostGator’s offerings. Stay tuned for in-depth looks at other providers in future articles.
    HostGator at a glance
    HostGator was founded in 2002 by a student at Florida Atlantic University (hence the “gator” in HostGator). Today, HostGator is one of nearly 100 web hosting brands owned by Endurance International Group (EIG).
    EIG was in the news in 2018, when the Times of India reported that its former CEO and CFO were charged by the US Securities and Exchange Commission for “overstating the company’s subscriber base.” The company agreed to pay an $8 million penalty without admitting fault.
    UPDATE: HostGator reached out to us requesting changes to the Quick Security Checks section of this article. Their comments and our responses are included inline in that section.
    How pricing really works
    Because there’s such variability among plans and offerings among hosting providers, it’s hard to get a good comparison. I’ve found that one of the best ways to see how a provider performs is to look at the least expensive plan they offer. You can expect the least quality, the least attention to detail, and the least performance from such a plan.
    If the vendor provides good service for the bottom-shelf plans, you can generally assume the better plans will also benefit from similar quality. In the case of HostGator, there were some bright spots, some annoyances, and some serious security concerns.

    For the series of hosting reviews I’m doing now, I’m testing the most basic, most entry-level plan a vendor is offering. In the case of HostGator, that’s what they call their Hatchling plan. To get pricing, I simply went to the company’s main site at HostGator.com. If you want to save some money, though, read to the end of this section.

    Like nearly every hosting provider in the business, their offering is somewhat misleading. There is no option to just get billed $2.75 per month. Notice the all-powerful asterisk next to the price.
    While it looks like you can get the Hatchling plan for $2.75 per month, that’s only if you prepay for three full years, which means you’re actually paying $105.35. If you want only one year, you’re charging $76.11 to your card (which is $5.95 per month). If you want to buy the service on a month-by-month basis, you’re paying $10.95 per month.
    When you hit the Buy Now button, the company pre-populates a one year subscription with optional add-ons for site monitoring and backup, adding $43.94 to the bill (but you can uncheck these options).
    There’s a painful gotcha to these “starting at” prices. When you renew, you’re going to pay more. This, too, is not uncommon for hosting plans and is a practice I strongly wish the hosting industry would stop. Instead of paying $105.35 for three years, upon renewal you’ll be paying a whopping $250.20 on a single credit card charge, a price increase that’s more than double the original price.
    Here’s another way to save money. If you come in through the affiliate link in CNET’s hosting providers directory, you get access to slightly lower prices on a per-month basis.

    Even though you can get a deal through that affiliate link, when your initial period ends, you’ll still be expected to pay the full renewal price for another three full years.
    I harp on high renewal fees in my coverage of hosting vendors for two key reasons. First, it’s a really nasty feeling suddenly getting a bill that’s hundreds or even thousands of dollars (depending on the plan) more than you expect. Second, switching from one hosting provider to another hosting provider can be a very time-consuming and possibly expensive job, fraught with hassles and potential points of failure.
    Unfortunately, while not a universal practice, at least half of the hosting vendors I’ve looked at over the years do these promo deals, with big jumps in renewal fees once they have you locked in.
    What the base plan includes
    As with most hosting vendors these days, HostGator claims unlimited disk space, unlimited bandwidth, and unlimited email. In practice, these unlimited values are limited in the terms of service. You can’t use your unlimited storage as a giant backup tank where you dump gigabytes of video, for example. They also state, “HostGator expressly reserves the right to review every shared account for excessive usage of CPU, disk space and other resources that may be caused by a violation of this Agreement or the Acceptable Use Policy.”
    In other words, don’t abuse the resources you’re buying, and buy the level of plan reasonably commensurate with your expected usage. If you’re about to run a big, national promotion where you expect lots of traffic, you might not want to use the Hatchling plan. If you get too much traffic, HostGator might shut you down or bill you a lot more.
    Their terms of service continue, “HostGator may, in our sole discretion, terminate access to the Services, apply additional fees, or remove or delete User Content for those accounts that are found to be in violation of HostGator’s terms and conditions.”
    The base level plan has some compelling features. First, and this is important as we move forward in a quest for a more secure web, is the availability of free SSL for your site. This adds that little lock icon to your browser’s address bar and makes sure traffic between your site and your visitors is encrypted.
    The company also offers 24/7/365 support which not only includes ticket and chat, but phone support as well. While you’re only able to use one domain, you can use as many subdomains as you wish. The company also provides a coupon for $100 in Google ads and another $100 in Bing ads. While you probably won’t get enough ad hits to cover your cost of hosting, it will help you get your feet wet in the world of Google and Bing advertising.
    Dashboard access
    The first thing I like to do when looking at a new hosting provider is explore their dashboard. Is it an old friend, like cPanel? Is it some sort of cobbled-together home-grown mess? Or is it a carefully crafted custom dashboard? These are often the ones that worry me the most, because they almost always hide restrictions that I’m going to have to work around somehow.
    When you first log into HostGator’s dashboard, you’re greeted with their customer portal. Here you can manage your credit card information, get support, and — most important, apparently — buy the upsell options they offer.

    This is not the only dashboard you’ll be using. The main dashboard is cPanel, which is common to many, many sites across the Web. While cPanel can be frustrating at times, it’s a very capable interface that lets you manage all aspects of your site.
    It took a surprisingly long time for cPanel to launch, almost a full minute. What’s a little more bothersome, though, is the range of additional upsells in the middle of cPanel. cPanel is usually pretty predictable and seeing almost as many ads and upsells as management options was tedious.

    Installing WordPress
    There are certainly other content management and blogging applications you can use besides WordPress. That said, since 32 percent of the entire Web uses WordPress, it’s a good place to start. WordPress sites can be moved from hosting provider to hosting provider, so there’s no lock-in. And by testing a site built with WordPress, we can get some consistency in our testing between hosting providers.
    I went ahead and clicked the Build a New WordPress Site button on the main cPanel page… and got hit with another page of upsell promotions:

    At $399, prices were really starting to climb from that tasty little $2.75 offer the company promoted. The promos on this setup page didn’t say what theme they’d be installing. WordPress does come with a nice set of free themes, and most themes are relatively inexpensive. I tried to figure out what the $399 program was for, but as far as I can tell, it’s simply setting up WordPress, which is usually about a five minute process.
    The difference between the $199 and $399 program was the addition of SEO and WordPress site security. To be fair, most WordPress security plugins and add-ons cost about a hundred bucks a year, and there are premium SEO plugins that can cost a similar amount. But without going all the way through the checkout, it wasn’t clear what tools HostGator was providing in return for its almost $400 of upsell.
    My advice is to skip these upsells. Simply install WordPress, get to know your site, and then start with a tool like Wordfence or Sucuri to keep your site protected.
    Once I entered my user name and domain, I was… wait for it… presented with another upsell:

    I went ahead and hit the login button, and… it failed:

    I took a quick look at the File Manager and determined that the WordPress install appeared to be in place. So, instead of using HostGator’s login button, I just used the standard WordPress admin URL, which is domain.com/wp-admin. This worked.
    I was, however, no longer surprised to find more upsells. In this case, the entire main dashboard page — going well below the scroll of the page — had upsells.

    There seems to be a big push for using a number of plugins that are either freemium or affiliate-based. Jetpack is produced by Automattic, the company behind WordPress. It also has an affiliate program.
    My guess is that HostGator is pre-installing plugins where they get some affiliate revenue. There’s nothing particularly wrong with that, but plastering these upsells in the middle of configuration screens is getting old.
    HostGator also dropped in a plugin for something called Mojo Marketplace. This, too, had pages and pages of upsells, this time for themes.

    With all the added plugins, junk, and upsell, it’s no wonder that the site initially failed when I hit the site login button from the HostGator dashboard.
    Let me be clear. There is nothing wrong with using lots of plugins on a WordPress site. That’s one of WordPress’s biggest strengths. But filling a site with crapware before it’s even live is nothing but a distraction, can add a considerable amount of confusion to new users, and may cause potential problems in terms of functionality. Plus, it’s just rude.
    Quick security checks
    Security is one of the biggest issues when it comes to operating a website. You want to make sure your site is safe from hackers, doesn’t flag Google, and can connect securely to payment engines if you’re running an ecommerce site of any kind. You also don’t want to distribute malware to your visitors. That’s bad.
    While the scope of this article doesn’t allow for exhaustive security testing, there are a few quick checks that can help indicate whether HostGator’s most inexpensive platform is starting with a secure foundation. Here’s the tl;dr: it’s not. This thing is dangerously insecure.
    The first of these quick checks is multifactor authentication. It’s way too easy for hackers to just bang away at a website’s login screen and bruteforce a password. One of my sites has been pounded on for weeks by some hacker or another, but because I have some relatively strong protections in place, the bad actor hasn’t been able to get in.
    Unfortunately, I have to ding HostGator for what I consider a pretty serious security flaw. When you log into their customer portal, all you need to provide is a username and password. However, if you want to ask support questions and get answers, you do need to set up a support PIN. This is a partial step forward. The problem is that if you’re able to log into the main management account, you can change the email address associated with it, and then have a new support PIN sent out. The bottom line is without a second factor for login authentication, the PIN is essentially worthless.
    Secondly, according to the support person I reached out to on chat, HostGator’s cPanel implementation also does not support multi-factor authentication, at least in the lower-end accounts.

    Multi-factor authentication should never be an upsell option, or provided only for premium accounts. It takes very little effort for a hosting provider to enable it. Not only does it protect the individual customers using the feature, it also protects all the customers of the hosting provider. That’s because most shared hosting servers share IP addresses. If a spammer or scammer hijacks a shared hosting account and that account is blocked, it’s entirely possible that all the accounts sharing that IP or that IP’s larger block of numbers will be blocked as well.
    I strongly recommend that HostGator implement MFA for all accounts immediately, for their benefit as well as that of their customers.
    I mentioned earlier that HostGator provides a free SSL certificate. They’re using Let’s Encrypt, a program that provides free, automated SSL certificates. Let’s Encrypt is enabled by default, so once you set up a website, all you need to do is use your https:// in your URL to provide encrypted URLs for your visitors.
    As my last quick security check, I like to look at the versions of some of the main system components that run web applications. To make things easy, I chose four components necessary to safe WordPress operation. While other apps may use other components, I’ve found that if components are up-to-date for one set of needs, they’re usually up to date across the board.
    Here are my findings derived from the HostGator versions page and a pleasant tech support conversation, as of the day I tested, for HostGator’s Hatchling plan:

    Component

    Version Provided

    Current Version

    How Old

    PHP

    7.4

    7.4.14 (8.0 is still a bit new)

    reasonably current 

    MySQL

    5.6.x

    8.0.23

    8 years / 2904 days (end of support is Feb 21)

    cURL

    7.19.7

    7.75

    11.3 years / 4124 days

    OpenSSL

     1.0.1e-fips 11

    1.0.2t (and 1.1.1)

    7.1 years / 2592 days

    The cURL library, which is meant for data transfer, particularly of secure information, is vastly and woefully out of date. A quick look at the cURL release table shows there have been thousands of bugs fixed and hundreds of vulnerabilities resolved since the version of cURL being provided by HostGator was released back in 2009. That’s more than a decade old. That would be like walking around today with an iPhone 3GS and running Windows Vista on your PC!
    UPDATE: HostGator told us, “cURL does list an older raw version, but RedHat/CentOS backport security patches and we update all servers at least daily. This is standard for RedHat/CentOS and expected behavior.” This is actually a very interesting process. Red Hat does go back to older versions of standard Linux software and port security fixes, as HostGator stated. However, even with security fixes applied, offering a nearly 10 year old version of cURL will provide website owners with ongoing compatibility challenges, particularly with payment gateways.
    The company supports OpenSSL 1.0.1e-fips 11, where the absolutely most current version is 1.1.1. The gotcha is that when OpenSSL went to 1.1, it broke a lot of code. As a result, the OpenSSL project is updating both the 1.0.2 branch and the 1.1 branch. I know, it’s enough to give you a headache. Here, despite all the version number confusion, there’s one fact you need to know: the version of OpenSSL HostGator is supplying is also vastly out of date.
    UPDATE: HostGator told us, “OpenSSL also lists an older raw version, but again RedHat backports security patches and we ensure daily updates.” This is the same backporting process Red Hat uses for cURL. It means that while security flaws have been updated, the version and its compatibility is still nearly a decade old.
    HostGator is using version 5.6 of MySQL. While MySQL supports many versions, the latest is 8.0. HostGator’s MySQL implementation is eight years old.
    UPDATE: HostGator told us, “All HG boxes have MySQL 5.6 or higher. The article reports 5.5, which hasn’t been in place for a long time.” While this was the version shown on HostGator’s own versions page when the article was written, we’re glad to see MySQL has been updated.
    What’s worse, each of the versions of these packages are below WordPress’s minimum requirements. 
    UPDATE: In light of HostGator’s use of backported security updates, we’re going to walk back the following statement. However, because MFA is not available and because many of these versions (even with backported security updates) will cause modern software to fail, we still consider HostGator a less than optimal choice for e-commerce or any security-related site.
    Given the vulnerabilities fixed since these versions were released, I have only one recommendation: Do not use HostGator’s Hatchling plan for anything e-commerce or security related. Period. Not only are you likely to run into conflicts with the various payment services who no longer support encryption libraries from the Stone Age, you’re opening yourself and your potential customers to a vast array of known hacking vulnerabilities.
    Performance testing
    Next, I wanted to see how the site performed using some online performance testing tools. It’s important not to take these tests too seriously. We’re purposely looking at the most low-end offerings of hosting vendors, so the sites they produce are expected to be relatively slow.
    That said, it’s nice to have an idea what to expect, and that’s what we’re doing here. The way I test is to use the fresh install of WordPress and then test the “Hello, world” page, which is mostly text, with just an image header. That way, we’re able to focus on the responsiveness of a basic page without being too concerned about media overhead.
    One note: normally I wouldn’t test a site with all the crapware plugins installed. But since most users who buy these plans probably won’t know how to remove the plugins or which plugins are safe to remove, I tested performance with those plugins installed. I fully expected performance numbers to take a hit from all that added cruft, but I was wrong. Performance wasn’t bad at all.
    First, I ran two Pingdom Tools tests, one hitting the site from San Francisco and the second from Germany. Here’s the San Francisco test rating:

    And here’s the same site from Germany:

    Next, I ran a similar test using the Bitchatcha service:

    Finally, I hit the site with Load Impact, which sends 25 virtual users over the course of three minutes to the site, and then measures the responsiveness.

    The Load Impact test was also somewhat unexpected. At the beginning of the test, some page load times took longer than they should. But as the number of virtual users climbed, responsiveness settled into a nice rhythm.
    While lower-end hosting plans often have spotty performance, this was a good showing. Most lower-end plans, including the one we’re testing, share server resources with other customers. So, at times of heavy activity, if one site is seeing heavy usage, the other sites may suffer. I’m testing this site on a Sunday afternoon, which is a relatively slow period in web hosting terms, but even so, the performance for this bottom-end site was unexpectedly reasonable.
    Support responsiveness
    I only needed to contact support once, through the chat interface. I was connected to someone within about five minutes. It took a few more minutes to establish a support PIN, but then I got my answer quickly.
    For a Sunday afternoon, it was a complete, reasonably knowledgeable answer. I’ve certainly experienced far worse support.
    Overall conclusion
    You never want to get your expectations too high for a bottom-end plan. The economics of running such a super-cheap offering is that the provider has to make it up on volume. Professional and enterprise hosting plans with lots of traffic and performance must, out of necessity, cost more.
    The only way to truly know what it’s like to use a service is to run a live website on it for a few years. That said, I was both pleased and disappointed with HostGator’s showing.
    I found my interactions with HostGator’s customer portal and cPanel to be sluggish. It often took 30 seconds to a minute for a click to process through to a result.
    On the other hand, performance of the site being hosted by HostGator, the site you’re paying for and want to be highly performant, was quite good.
    HostGator’s relatively constant upsell, especially within the configuration and operational aspects of the control panel, proved intrusive. The company installed way too many plugins in the default WordPress install, which not only caused the initial login to fail, but might make it far more confusing for new users.
    Finally, the company’s lack of support for modern security protocols and login security is deeply disturbing. They’re letting hundreds of thousands of customers launch websites with woefully out-of-date security software. Given that the security libraries are free and open source, there’s just no supportable reason for HostGator to be lax on this most important aspect of Web security.
    The company offers a 45-day money back guarantee, which is reasonable.
    The bottom line is this: if you want to set up a simple website as an online brochure, HostGator should be fine. But if you want users to login to or pay for something through your site, do not use this plan.
    You can follow my day-to-day project updates on social media. Be sure to follow me on Twitter at @DavidGewirtz, on Facebook at Facebook.com/DavidGewirtz, on Instagram at Instagram.com/DavidGewirtz, and on YouTube at YouTube.com/DavidGewirtzTV. More

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    Starlink is open for business

    I just ordered Starlink, SpaceX’s Low Earth Orbit (LEO) satellite internet service. For the first time, if you live in Canada, the United States, or the United Kingdom, you can too. Alas, that doesn’t mean I, or you, will get it anytime soon.

    But, with its first-come, first-served approach, at least you’ll be on the list. Before this offer arrived, you could apply to be in the Starlink beta test and hope for this best. 
    Getting on the Starlink list will cost you a $99 deposit. You can pay for this with a credit card. Sorry, despite what founder Elon Musk has said, paying by Bitcoin isn’t an option yet. 
    In return, you’ll get an estimated coverage date of either 2021 or 2022 based on your location.  In my case, I live in Asheville, North Carolina, and I have an estimated service date of late 2021. 
    When, and if, I get the service, Starlink will also charge me $499, plus tax, for the Starlink Kit, which will consist of a small satellite dish with installation gear and a Wi-Fi router. The service itself costs $99 a month. In the fine print, you’ll see that the charges for this preorder are fully refundable and — drat it — “placing a deposit does not guarantee service.”
    Is it worth it? I’m getting it not because I need it — Charter/Spectrum does well enough for me — but because I cover the Internet Service Providers (ISP) and networking, I need to exactly how it works and how well it works. 
    Starlink is really meant for people who can’t get conventional broadband. It’s not meant as a replacement for people who can already get broadband via cable or fiber but rather, it’s for people whose “broadband” choices are otherwise DSL, conventional satellite internet,  or even dial-up modems. If that’s you then you want to check Starlink out.

    According to independent third-party tests, such as TestMy.Net, Starlink provides an average download speed of 55.59 Megabits per second (Mbps), with a top speed of 194.44Mbps. Fast compared to gigabit fiber? No. Fast compared to its competitors in the backwoods? Oh yes.
    Another plus is that Starlink has a relatively low latency of 20 to 40 milliseconds. Again, a gamer might sneer at that, but compared to the hundreds of milliseconds of old-style satellite internet, it’s an order of magnitude better.
    There’s already pent-up demand for Starlink’s internet. SpaceX has applied for an FCC license to roll out five million “UFO on a stick” end-user terminals over its original request for a million terminals. This came after 700,000 US residents signed up to be updated about the service’s availability.  As of January 2021, however, Starlink only has 10,000 beta testers.
    Add it all up and I’m hoping, but not expecting, to see a Starlink antenna on my roof this year. There needs to be a lot more Starlink kits produced and Starlink satellites launched to deliver the internet goodies to 5 million users. Still, you can now start making plans for Starlink to be your internet connection sooner rather than later.
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    Telstra revenue and earnings decimated on lower roaming data and hardware sales

    Image: Asha Barbaschow/ZDNet
    Telstra reported on Thursday it had a challenging end to the calendar year of 2020, as the company saw double-digit drops in revenue and earnings before interest, income tax expense, depreciation, and amortisation (EBITDA) and, consequently, it has revised its guidance downwards.
    For the half year to December 31, the company saw revenue fall 10% to AU$12 billion, while EBITDA dropped 14.7% to AU$4 billion, and EBIT took a 20% hit to decline to AU$1.64 billion. Thanks to a substantially lower level of income tax, down 60% to AU$209 million, net profit fell only 2.2% to AU$1.13 billion.
    The reasons for the lower revenue was pinned on lower hardware sales, while the now regular blame on NBN headwinds and a lack of international roaming revenue due to the pandemic drove the lower profitability.
    The company said handset and tablet sales were down by 450,000 units, which translated to a 29% decline to AU$1.24 billion for the quarter as a line item.
    COVID-19 slowed sales during the quarter by lowering foot traffic in stores by 30%, customers were using pricier handsets for longer before replacing them, more people were purchasing phones outright from other retailers, and the latest iPhone release was later than usual.
    “Of these reasons, impacts of COVID on sales and the later iPhone release drove outcomes materially different to our estimates when we set guidance,” Telstra CFO Vicki Brady said. “We anticipate these impacts to continue in the second half.”
    On the positive side, despite an 8.6% reduction in average revenue per user, the company maintained that figure would increase in the second half of its fiscal year.

    Now that the company has reversed course and resumed its T22 job shedding, Telstra CEO Andy Penn said the company is looking to complete its goal of firing 8,000 people by the end of the 2021 calendar year.
    “In terms of reductions in indirect headcount, it was initially our expectation to reduce by around 25% or 10,000,” Penn said. “However, we have already reduced 16,000 and we expect to make further reductions to our indirect workforce due to the significant progress we have made in digitising the business. The majority of these roles have been offshore.”
    Penn added that the company closed its Cebu call centre in the Philippines last week as it looks to have its consumer and small business customer calls answered in Australia within the next year and a half.
    Telstra also announced on Thursday it would take full ownership of Telstra branded stores around the country.
    “As more customers interact with businesses online as a result of COVID, we think now is the right time to bring back ownership to ensure a consistent and integrated customer experience across our online channels and entire store network,” Penn said.
    “At the height of COVID last year we were able to redeploy frontline staff from Telstra owned stores to assist customers through our digital channels or via the phone. It’s this flexibility that we’ll be able to unlock as more retail branded stores are under Telstra’s ownership.”
    The company currently has 67 owned and operated stores, with 166 stores run by independent licensees, and 104 stores operated by Vita Group. The telco said it would begin discussions with its licensees today, and would “offer roles to current store staff in the majority of cases”.
    Looking at its revenue by division, mobile was down 12% to AU$4.7 billion, as the company added 80,000 postpaid customers, which included 22,000 from Belong. It also had an extra 456,000 IoT services on its network by the end of the half, and now has around 1 million 5G devices on its network.
    For consumer and SMB fixed line, revenue was down 7.5% to AU$2.43 billion with declines in voice services and Foxtel from Telstra users.
    Enterprise fixed line dropped 6.4% to AU$1.85 billion as not all copper line users migrating to NBN stayed with the telco.
    “Single-digit growth in managed services, including security and cloud applications, was insufficient to offset structural declines in calling applications (including ISDN), as well as equipment sales and professional services,” Brady said.
    Wholesale fixed continued to shrink with the shift of services to NBN connections, with revenue diving 19% lower to AU$770 million.
    The international business of Telstra Enterprise was down 11% to AU$755 million.
    “Our underlying results remained challenged … however, our continued focus on T22 is delivering simpler, better outcomes for our customers and greater productivity,” Brady said.
    “Product margin improvement is also imminent, and already occurring in mobile. We see clear positive indicators of an improved financial trajectory, which we expect will return us to underlying EBITDA growth in FY22, and put us on the path to achieving our FY23 financial ambitions.”
    Telstra touted it would be handing AU$950 million of its cash to shareholders in the form of an 8 cent dividend.
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    Huawei requests US courts to overturn its national security threat designation

    Huawei has once again filed a lawsuit against the United States government, this time picking a fight with the Federal Communications Commission (FCC) for its decision to designate the company as a national security threat.
    According to the legal complaint, Huawei is seeking a review of the designation on the grounds that the execution of the order was beyond the FCC’s scope of powers; violated federal law and the Constitution; arbitrary, capricious, and an abuse of discretion; and not supported by substantial evidence.
    Huawei also said in the complaint that the designation could adversely impact the financial interests of the telecommunications industry as a whole.
    The FCC designated Huawei, alongside ZTE, as a national security threat back in June, which has resulted in US telcos no longer being able to use the FCC’s Universal Service Fund to purchase equipment or services from these Chinese companies. 
    Departing FCC chair Ajit Pai said at the time there was an “overwhelming weight of evidence” that both Huawei and ZTE had close ties to the Chinese Communist Party and China’s military apparatus.
    The designation arose after former US President Donald Trump signed legislation barring US companies from using federal funds to purchase equipment from companies that have been deemed as national security threats.
    The law also established a $1 billion reimbursement program to help smaller providers with the cost of ripping out and replacing the prohibited equipment from Huawei and ZTE. 

    The FCC is not the only federal agency that has faced legal action from Huawei. Shortly after the US Commerce Department added Huawei to its “Entity List” — which bars US companies from transferring technology to Huawei without a government-approved licence — Huawei filed a lawsuit against the agency on claims that it acted unconstitutionally in enforcing the ban.
    That lawsuit was eventually dismissed in February last year on the grounds that Congress was within its rights to enforce the ban.
    “Contracting with the federal government is a privilege, not a constitutionally guaranteed right — at least not as far as this court is aware,” District Judge Amos Mazzant said in the February ruling when addressing Huawei’s arguments. 
    Huawei has also filed a legal action requesting for the law that enforced the ban to be thrown out. This legal action is still being considered by the courts.
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    NBN aims up at first positive full-year EBITDA after 25% revenue bump

    Two charismatic gentlemen: Minister Paul Fletcher and NBN CEO Stephen Rue
    Image: Chris Duckett/ZDNet
    The company responsible for the National Broadband Network (NBN) has dispensed with its previous earnings before interest, tax, depreciation and amortisation (EBITDA) games as it gears up to report positive earnings at year end after a solid first half.
    For the six months to the end of 2020, NBN reported a 25% increase in revenue to AU$2.26 billion, which it said was thanks to 660,000 premises joining the network and increased demand for higher speed plans. Revenue from business customers was also up by a quarter compared to this time last year, and was reported as AU$397 million. Average revenue per residential user remained flat over the past year at AU$45 each month.
    On the EBITDA front, the company reported AU$424 million, a AU$1.1 billion turnaround on the AU$663 million EBITDA loss reported last year, and included AU$809 billion in payments to Telstra and Optus as users switch onto the government-owned network. Those payments had previously been excluded as NBN paraded an “adjusted EBITDA” figure as its headline number.
    The company said it was “focused on raising AU$27.5 billion of private debt” by the end of the middle of the 2024 calendar year and has repaid AU$3 billion of its AU$19.5 billion loan from the federal government during the half, thanks to the AU$1.6 billion it raised in medium term notes at 1% interest and AU$1.4 billion from its bank credit.
    “The strong total revenue growth in the first half puts us in solid position to achieve positive full year statutory EBITDA for the first time, which will be a significant financial milestone for the company,” NBN CEO Stephen Rue said.
    “We will continue to put our customers at the centre of everything we do. We will support businesses by extending the competitive benefits of NBN to more regions, and we will continue to co-invest with state governments and local councils to help ensure that the benefits of fast broadband are extended to more Australians than ever before.”
    Across the first half, the company spent AU$1.42 billion on capital expenditure, and announced the next 100,000 premises to hooked up with its fibre-to-the-node upgrades that will cost around AU$4.5 billion.

    In NSW, the suburbs and towns of Campbelltown, Elderslie, Narellan, Maitland, Singleton, Tarro, New Lambton, Bathurst, and Orange are on the list; in Victoria, Deer Park, Sydenham, Berwick South, Cranbourne, and more parts of Narre Warren will be next; Albany Creek, Ashgrove, Bald Hills, Ferny Hills, Robina, Burleigh Heads and Townsville will get the upgrade in Queensland; for South Australia the list is Elizabeth, Gepps Cross, Salisbury and Golden Grove; while in Western Australia the suburbs are Girrawheen, Kingsley, Wanneroo, Canning Vale, and Jandakot South.
    The company said it was “currently engaged in consultation” with ISPs on how customers will be informed of the upgrades, and what they need to do to get a fibre lead-in. NBN has previously said when a customer orders a service that their copper connection cannot handle, it would at that point build the fibre lead-in to the premise.
    At the start of February, NBN confirmed it was pausing connecting new HFC premises to its network, due to coronavirus-related supply chain issues. Nevertheless, the company claimed its HFC footprint was “progressing well”.
    “As at 10 February 2021, 94% of the 2.5 million premises in the HFC footprint can access the NBN Home Superfast [250/25Mbps] wholesale speed tier, and 46% of premises in the HFC footprint are able to access the NBN Home Ultrafast [500-1000Mbps/50Mbps] wholesale speed tier.”
    NBN reported it had decreased its net loss by 25% to AU$2.1 billion for the half. In August, it reported an EBIT loss of AU$3.78 billion for the full 2020 fiscal year, compared to AU$3.89 billion a year prior.
    The company reported its employee expenses increased by 3% due to restructuring charges and unused annual leave by its employees. Rue said the company had reduced its employee number by 800 during the first half, but would not be drawn on further cuts.
    “The size and composition of the workforce changes all the time — it can change up, it can change down,” Rue told ZDNet.
    “We’ve been hiring people in regional Australia, we’ve been hiring people … to go into people’s homes.”
    Last week, Telstra resumed its T22 job shedding process as it flagged 1,425 employees would leave the incumbent telco.
    On Monday, the CEPU informed its members that under the plans to restructure Telstra into three business, that “pretty much all the jobs at Telstra” are technically redundent.
    “The truth is, that even if your role is redundant at Telstra, the three subsidiaries are going to have a whole lot of work with no employees to perform it. So, the scenario is one of thousands of jobless ex-Telstra employees and thousands of vacancies at the subsidiaries,” the union said.
    “As you can see, the solution is the problem.
    “In our preliminary discussions, Telstra has indicated the subsidiaries will seek to employ the same people from Telstra, to continue doing the same work once they have taken it over.”
    The CEPU added the existing Telstra enterprise agreement for workers would follow the employees across until it is terminated or a new agreement is signed.
    Updated at 11:10am AEST, 10 February 2021: Added more information
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    Cisco sees growth in services, security products in Q2

    Cisco on Tuesday published better-than-expected second quarter financial results, with growth coming from services and security products.  
    Non-GAAP net income for the quarter came to $3.4 billion, or 79 cents per share. Revenue was $11.96 billion, flat year-over-year.
    Wall Street was expecting earnings of 76 cents on $11.92 billion in revenue.

    Overall, product revenue was down 1 percent year-over-year, totaling $8.57 billion. Within that category, security revenue was up 10 percent to $822 million. Revenue from infrastructure platforms declined 3 percent to $6.39 billion, while applications revenue was flat at $1.35 billion. Revenue from “other products” declined 39 percent to $4 million. 
    Service revenue was up 2 percent year-over-year, reaching $3.39 billion. 
    “Over the past year, our customers have relied on our innovation to accelerate their digital and cloud capabilities while protecting them from an expanding threat environment,” CEO Chuck Robbins said on a conference call. “In my numerous conversations with customers, it is clear that our technology will be a powerful engine for their recovery and growth as their technology needs continue to evolve at a rapid pace”
    CFO Scott Herren noted in a statement that Cisco continues “to grow deferred revenue in double-digits through the shift to more software and subscriptions.”

    Deferred revenue in Q2 was $20.8 billion, up 12 percent in total, with deferred product revenue up 16 percent. Deferred service revenue was up 9 percent.
    Remaining Performance Obligations came to $28.2 billion at the end of Q2, up 13 percent.
    Tech analyst Patrick Moorhead noted that, in addition to its double-digit growth in security sales, Cisco also reported strength in Cat 9K, data center switching, wireless and Webex portfolio numbers. 
    “For webscale customers, it was the 5th consecutive quarter of rapid order growth increasing to triple digits,” Moorhead added. “This is important as these customers had walked away in many parts from Cisco opting for their own designs. In a very rough period for infrastructure providers, I believe Cisco proved its resilience by balancing infrastructure against software, security and collaboration businesses.”
    Cisco on Tuesday also declared a quarterly dividend of 37 cents per common share.  
    For the third quarter, Cisco expects revenue growth of 3.5 percent to 5.5 percent year-over-year.

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    SoftBank's Vision Fund continues bounce back by posting ¥844 billion profit in Q3

    Image: SoftBank Group
    SoftBank Group’s CEO Masayoshi Son has labelled his company a “golden goose” in response to its Vision Funds bouncing back from a record loss last year to post profit of ¥844 billion during the third quarter.
    According to Son, the ¥1 trillion year-on-year turnaround was due to sectors such as e-commerce, entertainment, healthcare, education, and food delivery benefitting from the accelerated adoption of digital services that arose during the pandemic.
    As of 31 December 2020, Vision Fund 1’s 82 investments have increased their value by 18% to $90 billion, compared with their purchase price of $76.3 billion.
    Unrealised valuation gain for Vision Fund 1 as of the end of the third quarter totalled ¥1.5 trillion for listed portfolio companies, with DoorDash and Uber being the primary reasons for this uptick. The two companies have provided unrealised valuation gains of $8.3 billion and $3.6 billion, respectively, as of December.
    Vision Fund 2, meanwhile, currently holds 26 investments with fair value amounting to $9.3 billion. The second fund’s investments had initially cost $4.3 billion.
    Moving forward, Son during the results presentation said he expected SoftBank’s funds to produce between 10 and 20 initial public offerings a year.
    “We’ve finally entered the harvest phase,” Son said while presenting an image of a golden goose laying golden eggs, which were meant to represent SoftBank’s IPOs and exits.

    SoftBank Group’s Japanese telco, SoftBank, also reported being in the black by posting almost ¥213 billion and ¥1.37 trillion in profit and revenue, respectively.
    For the third quarter, the telco’s consumer segment continued to carry the lion’s share of sales by posting ¥697 billion in revenue. Meanwhile, its enterprise and Yahoo segments chipped in ¥153 billion and ¥270 billion, respectively.
    The telco also revealed that its smartphone subscriber base increased by over 1.2 million across a six-month period to December. Its broadband service, SoftBank Hikari, also gained an additional 450,000 subscribers over that same period.
    In total, the gains from SoftBank Group’s various segments culminated in net profit of ¥1.17 trillion from ¥1.38 trillion in sales during the third quarter.
    SoftBank’s profit marks a shift from the year prior, when the company revealed significant losses from WeWork and the COVID-19 pandemic, which forced the company to sell assets.
    At the time, Son said he expected 15 companies in Vision Fund 1 to go bankrupt as the company tightened its financial belt.
    Looking at the sale and monetisation of those assets, the company has amassed ¥5.6 trillion over the six months from April to September 2020 from partially selling its T-Mobile, Alibaba, and SoftBank Corp shares.
    Providing an update on how the ¥5.6 trillion would be used, Son said the company would seek to make new investments for sustainable growth and return profits to shareholders.
    He added that while share repurchases of up to ¥2 trillion were originally intended to be executed across 12 months from March last year, uncertainty in market trends has meant that the repurchases may not be completed by the end of March 2021, as originally scheduled.
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    Myanmar military orders saw data network temporarily halted

    Telenor Myanmar said it was ordered by the Myanmar Ministry of Transport and Communications (MoTC) to temporarily shut down its data network in Myanmar on Saturday, while voice and SMS services remained open.
    “In the directive, the MoTC cites legal basis in Myanmar’s Telecommunication Law, and references circulation of fake news, stability of the nation and interest of the public as basis for the order,” Telenor said in a statement.
    “Telenor Myanmar, as a local company, is bound by local law and needs to handle this irregular and difficult situation.”
    Despite following the orders, the telco giant expressed their “deep concern”.
    “We have emphasised to the authorities that access to telecom services should be maintained at all times, especially during times of conflict, to ensure people’s basic right to freedom of expression and access to information. We deeply regret the impact the shutdown has on the people in Myanmar,” the company said.
    However, data networks that were shut down was restored by Sunday. Telenor said it was “following instruction from the MoTC”.
    The halting of data network services over the weekend followed a directive that was issued by the MoTC on Friday to block social media platforms Twitter and Instagram, until further notice, according to Telenor.

    “Customers in Myanmar trying to access the affected services on web will be directed to a landing page, which states that the site cannot be reached due to the directive by MoTC,” Telenor said.
    Telenor added the MoTC also decided to “temporarily” block access to Facebook in the country last week. Users began turning to the social media platform to protest against the military coup.
    Meanwhile, Twitter has expressed concern regarding the situation.
    “We’re deeply concerned about the order to block Internet services in Myanmar. It undermines the public conversation and the rights of people to make their voices heard. The Open Internet is increasingly under threat around the world. We will continue to advocate to end destructive government-led shutdowns,” a Twitter spokesperson told ZDNet.  
    A similar sentiment was echoed by Facebook. 
    “We are extremely concerned by orders to shut down the internet in Myanmar and we strongly urge the authorities to order the unblocking of all social media services. At this critical time, the people of Myanmar need access to important information and to be able to communicate with their loved ones,” Facebook APAC Emerging Countries director of public policy Rafael Frankel said.
    Since last week, the country has been suffering internet and phone service disruptions amidst a military coup that has reportedly resulted in the National League for Democracy’s leader Aung San Suu Kyi and other senior political leaders being detained.
    Military-owned TV network Myawaddy News reported that the military was taking control of the country for a year, during which a state of emergency had been declared. It pointed to a section of the constitution, drafted by the military, which outlined the army’s powers to assume control during a national emergency. 
    Updated at 11:05am AEST, 8 February 2021: added comment from Facebook. 
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