Xerox To Revamp Healthcare IT Business

Xerox Corp said it would overhaul its healthcare IT business and record a related impairment charge of about $145 million in the second quarter.

The company said it would end sales of its integrated eligibility system, a software system which can support operations in call centers and document imaging.

The healthcare business provides administrative and care management solutions to state Medicaid programs and government healthcare programs.

“Going forward, Xerox will focus on managing and completing the current Health Enterprise implementations, and will be highly selective in responding to new Medicaid Management Information System opportunities,” the company said on Friday.

The healthcare business contributes “$2 billion plus” to total revenue, a company spokeswoman said. The company reported total revenue of $19.54 billion for 2014.

“Basically, they are focusing their government healthcare business away from less profitable initiatives that they were pursuing. I see it as a positive,” Cross Research analyst Shannon Cross said.

“From a long-term stand point, it (Medicaid) is a profitable business,” Cross said.

Xerox, which has been shifting its focus to IT services from making printers and copiers, adjusted its earnings estimate for the quarter ended June to reflect the charge.

The company said it now expects earnings from continuing operations of 9-11 cents per share, below its prior guidance of 17-19 cents per share.

Shares of Xerox, which is expected to report second-quarter results on July 24, were up 1.6 percent at $10.79 in afternoon trading.

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Will Sprint Cut It’s Staff?

Sprint’s new CEO Marcelo Claure addressed employees for the first time and promised price reductions are coming very soon, according to a report.

Sprint didn’t deny the report of Marcelo’s comments. A spokesman also confirmed Friday that Sprint is “focusing on providing the best value in the market.”

According to the account of Claure’s comments, he told workers, “We’re going to change our plans to make sure every customer in America thinks twice about signing up to a competitor.” The report, which first appeared in LightReading.com, also said that “very disruptive” rate plans are coming this week.

Sprint didn’t dispute Light Reading’s report, but a spokesman said Sprint is not commenting on “any potential pricing plans before they are announced.”

The spokesman, Doug Duvall, said Marcelo held his first all-employee town hall meeting before a standing-room-only crowd. He added: “He shared his passion for his family, work and soccer team and his commitment to leading Sprint. He discussed Sprint’s challenges and pledged to get Sprint ‘back in the game’ by focusing on providing the best value in the market, completing our network build and optimizing Sprint’s cost structure.”

By confirming Sprint wants to offer the “best value in the market,” it’s pretty clear that Sprint, the third-largest U.S. carrier, will soon wage a price war with the T-Mobile, the fourth-largest U.S. carrier that has quickly been gaining on Sprint.

Analysts recently said Sprint’s recent “Framily plan” isn’t competitive in the market, which former CEO Dan Hesse acknowledged in late July before his departure on Monday.

The Sprint Framily plans costs $160 a month for 4GB of data, but comes with overage charges and won’t allow tethering. Meanwhile, T-Mobile has a family plan offered through September that costs $100 a month for four lines and 10GB of data, although each line is limited to 2.5GB.

Hesse had earlier described subscriber plans Sprint was testing that have tiers of data and unlimited data.

According to Light Reading, Claure also told employees that price cuts are needed because Sprint’s network isn’t at the level of performance and reach that it should be. “When you have a great network, you don’t have to compete on price,” he reportedly said. “When your network is behind, unfortunately you have to compete on value and price.”

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Qualcomm Acquires Patents From HP

Chip making giant Qualcomm Inc has purchased a patent portfolio from Hewlett-Packard Co, including those of Palm Inc and its iPaq smartphone, in a move that will bulk up HP’s offerings to handset makers and other licensees.

The portfolio comprises about 1,400 granted patents and pending patent applications from the United States and about 1,000 granted patents and pending patent applications from other countries, including China, England, Germany, Japan and South Korea.

The San Diego-based chipmaker did not say how much it paid for the patents.

The majority of Qualcomm’s profits come from licensing patents for its ubiquitous CDMA cellphone technology and other technology related to mobile devices. Instead of licensing patents individually, handset vendors, carriers and other licensees pay royalties to Qualcomm in return for access to a broad portfolio of intellectual property.

The patents bought from HP, announced in a release on Thursday, cover technologies that include fundamental mobile operating system techniques.

They include those that HP acquired when it bought Palm Inc, an early player in mobile devices, in 2010 and Bitfone in 2006. HP tablets made using Palm’s webOS operating system failed to catch on.

“There’s nothing left at Palm that HP could get any use out of so it’s better to sell the patents, which are always valuable to Qualcomm,” said Ed Snyder, an analyst with Charter Equity Research. “They have to keep that bucket full.”

The new patents will not lead to increased royalty rates for existing Qualcomm licensees, a Qualcomm spokeswoman said.

Last year, HP sold webOS, which it received as part of the $1.2 billion Palm acquisition, to South Korea’s LG Electronics Inc.

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Kodak Goes After Apple

Kodak has sued Apple and HTC for allegedly infringing patents related to camera imaging.

According to the Wall Street Journal, the camera firm is alleging infringement of four patents by both companies as well as a fifth by HTC. It also filed a related complaint against both companies with the US International Trade Commission (ITC).

Kodak said it obtained its patents because it decided that people would like to easily share pictures from their digital cameras before putting them on their PCs.

It claimed Apple and HTC are infringing the patents by selling and importing mobile camera phones, tablets and other devices. The federal lawsuits were filed in Kodak’s home town of Rochester, New York.

The firm wants to stop Apple and HTC from selling products such as the Iphone and Ipad and is seeking compensatory and triple damages.

Kodak also has patent litigation ongoing against RIM, and legal proceedings have been taking place for more than a year.

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