Your report for Thursday, November 20, 2008

MichBio 2008: Life sciences industry faces threats, opportunities
When it comes to the life sciences industry, the incoming Obama administration will try to move more people to health insurance coverage and will emphasize prevention more strongly. And overall, the Obama administration may not be as friendly to Big Pharma as the outgoing Bush administration -- and huge deficits may force it to cut life sciences research funding. That was the word Thursday morning at a legislative update panel discussion at the fourth annual MichBio Expo and Conference, which returned to the Detroit area for the first time since its opening at the Rock Financial Showplace in Novi. Roughly 500 people attended. More.

Consumers Energy gets 28,000 acres for wind power in two counties
Consumers Energy said this week it had secured more than 28,000 acres of easements in Tuscola and Mason counties for potential wind generation development and is starting the process of testing sites. Construction started today on four meteorological towers in Mason County, on the Lake Michigan shore in West Michigan, and three towers in Tuscola County, in the Thumb. Construction of the towers, which are about 180 feet tall, is expected to be completed by the end of the year. In addition to the seven towers being constructed, Consumers Energy also will be refurbishing two existing Mason County towers it has purchased. More.

Altair software manages 600-teraflop computer for NASA
Troy-based Altair Engineering Inc. Wednesday announced that the NASA Advanced Supercomputing Division at NASA Ames Research Center, Moffett Field, Calif., has entrusted workload management of its huge new Pleiades cluster to Altair's PBS Professional software. Pleiades, an cluster with 51,200 cores across 12,800 Intel Xeon processors and 51 terabytes (trillions of bytes) of memory, has 609 teraflops (trillions of calculations per second) of peak processing power. According to a recent benchmarking that's good for No. 3 on the list of the world's fastest supercomputing systems. More.

Internet123 beefs up network
Southfield-based Internet 123 Inc. has announced the completion of a 10-gigabyte upgrade to its Internet Protocol backbone network increasing total capacity to 14G. The investment was made so clients could continue receiving redundant, high capacity bandwidth that is consistent with the demand wholesale customers require. More.

New desktop software from Stardock
Plymouth-based Stardock Corp. Wednesday announced the launch of Object Desktop 2009, its latest software to change and customize the look and feel of the Windows desktop. Object Desktop is a suite of utilities that enables users to completely personalize the Windows experience -- change how Windows looks, feels, and functions to suit the user's preference. More.

Howard & Howard says new energy law means higher bills

Almost lost in news of Michigan's new renewable energy law was a companion law which severely rolls back the state's 2000 electric competition statute.

That part of Michigan’s new energy policy is almost certain to increase power rates in Michigan – and probably by a substantial margin, according to the energy and utility attorneys at Howard & Howard.

Michigan has one of the nation's oldest power plant "fleets" with some plants more than 60 years old, according to Rodger Kershner, who leads the firm's utility practice. So "we are going to have to start replacing our power plants, and the cost is going to be staggering compared to the cost of the existing plants," he said. "By my back-of-the-envelope calculation, the cost of a new plant will be at least 10 times the cost that an old plant contributes to rates at present. Old plants were built in the 1950s, 60s, 70s and 80s and have been depreciated. For new plants, the cost of steel and concrete and labor and engineering have exploded."

The law also restricts the level of electric competition in the state to 10 percent of the utilities’ average retail sales. That new law’s threshold is higher than the load serviced by competitive providers today -- but as prices escalate, there could be a stampede to the door to get into deals with power from other sources besides the state's big utilities.

“To be fair, higher prices may have been in the cards even without a new law,” Kershner noted. “Higher fuel costs for the plants play a role, for example, just as carbon emission taxes could. But the new law will contribute to the problem because it allows utilities to increase their rates at a faster pace, provides automatic pass-throughs for some cost overruns, allows rate increases to be based on projected costs instead of costs incurred, and because the law reduces the influence that healthy competition can play in the marketplace.”

Howard & Howard offers several tactics for power users to adjust to the new law.

* Keep an eye on the 10 percent threshold and be ready to move quickly to alternative sources if they're available and cheaper.
* Participate in MPSC hearings, remembering that groups and trade associations have more clout than individual businesses.
* Consider moving to a different tariff that has some conditions. As an example: One Michigan university moved to a far cheaper interruptible power tariff after installing six megawatts' worth of diesel generators. The move also gave the school the luxury of full power backup when the grid goes down.
* Consider your own Energy Optimization Plan under the “renewables” portion of the new law -- which can get you a lower tariff as well as the benefits of showing you how to use less energy.
* Consider installing distributed or renewable energy generating equipment, given numerous tax incentives.
* Get together with an attorney who specializes in this area or other energy expert to see how the strategic alternatives are best fit together for your particular situation.

"We could find that the pace of increases in energy pose the same challenge in the next decade that health care increases have posed in the last,” Howard & Howard energy and utility attorney Jon Kreucher said. “Companies carefully negotiate many of their supplier agreements. They need to look at power like another supplier agreement, and should devote an equivalent amount of time and attention to that arrangement and to their strategic options."

Kershner and Kreucher also pointed out that the rulemaking under the law is now at a critical phase -- and major power users should be involved.

For more information, contact Howard & Howard attorney Rodger Kershner at (248) 645-1483.

Today's Blue Box was sponsored by the law firm Howard & Howard. For information on how you can sponsor content in the Blue Box, contact Jeff Lasser at (248) 455-7319 or jeff.lasser@cbsradio.com.

Prima Civitas gets $200k grant for university tech transfer, entrepreneurism
Lansing's Prima Civitas Foundation announced today that it has received a grant from the C.S. Mott Foundation in the amount of $200,000 to further its efforts toward creating an environment that encourages entrepreneurship and commercialization within the region’s universities. This grant is a renewal of last year’s $250,000 grant funded by the Mott Foundation that introduced the “Moving Ideas to Market” initiative to the region, and that created five action groups that will move forward in creating a next-generation, dynamic region that supports commercial efforts of university research and intellectual property. More.

Pillar offers new wrinkle for Java code
Pillar Technology has addressed the lack of unit test coverage in legacy Java J2EE applications, and solved the extreme hassle and cost of manually written tests. Pillar released Verdé, a tool that automates the characterization testing of all Java J2EE applications, recording Junit tests dynamically at run time. More.

Zondervan buys online community resource for churches
Grand Rapids-based Zondervan Wednesday announced it had acquired The City, a proprietary online community-building software program created by Seattle-based Mars Hill Church. Terms of the agreement were not disclosed. Developed over the past two years by Mars Hill pastor of technology, Zack Hubert, who spent eight years in management at Amazon.com, The City was created in response to the church's need to improve communication, better engage with members, support small groups, build a stronger church community and free up administrative resources. More.

THE WORLD IN TECH

Akamai to cut 7 percent of work force, 110 jobs
Akamai Technologies Inc., a Web content provider, said Wednesday it is cutting 7 percent of its work force in the fourth quarter as part of a restructuring to save on costs. The company said about 110 employees will be affected. It will take a restructuring charge of $4 million for severance and related expenses. Akamai said it also expects to recognize a loss on sublease income of about $2.5 million related to certain leased facilities. More.

Ballmer dismisses Yahoo buyout but open on search
Microsoft Corp. is no longer interested in buying all of Yahoo Inc., CEO Steve Ballmer said Wednesday, though he told shareholders that the company would still be "very open" to a collaboration on Internet search. His comments sent Yahoo shares diving more than 20 percent. "Let me be clear," Ballmer said at Microsoft's annual shareholder meeting. "We are done with all acquisition discussions with Yahoo." Yahoo spurned a $47.5 billion takeover offer from Microsoft in May, and later rejected Microsoft's bid to buy only its search engine. Ballmer has said repeatedly of late that the buyout remains off the table, though a search-related deal is possible. More.

China's Baidu.com fights to rebuild reputation
Baidu.com has been the star of China's Internet world. But now the search engine dubbed "China's Google" is scrambling to rescue its reputation after state TV accused it of letting unlicensed suppliers of medical products pay for higher rankings on its results page - without alerting users. Baidu.com Inc.'s U.S. shares have plunged this week, including a 30 percent drop Monday, since the weekend TV report. Baidu says it has suspended thousands of merchants from its paid-search service but says it broke no law. More.

E-mail in zero G: NASA develops network for space
In space, no one can hear you scream. But scoring an Internet hookup suddenly isn't out of the question. NASA scientists have developed software they hope will lead to an Internet-like network in deep space. It's not that astronauts will be watching "Alien" on Hulu.com. The goal of the technology NASA has been testing is to get spacecraft to communicate in a networked way like computers now do on Earth. It will make missions easier to manage. The technology is young at this point: Engineers have been sending images between a spacecraft and computers on the ground that are simulating landers, orbiters and other essential parts of a Mars mission. More.

Stocks: Stocks blasted by economic woes, close at five-year lows
A broad sell-off in the tech sector Wednesday dragged the Nasdaq Composite Index to its lowest level since early 2003 with trading highlighted by Yahoo Inc. shares, which fell to a nearly six-year low, and a weak forecast for the semiconductor industry. By the closing bell the Nasdaq Composite Index (COMP) had fallen 96.85 points, or 6.5 percent, to 1,386.42. The Dow industrials ($INDU) fell 424.47 points or 5.1 percent to 7,997.28. The Philadelphia Semiconductor Index ($SOX) fell 14.79 points or 7.7 percent to 177.1 and the Morgan Stanley High Tech 35 Index (MSH) fell 20.84 points or 6.5 percent to 299.41. The Amex Pharmaceutical Index ($DRG) fell 13.57 points or 5.2 percent to 248.8, while the Amex Biotech Index (BTK) fell 31.84 points, or 5.2 percent, to 575.29. Finally, the Standard & Poor's 500 (SPX) fell 52.54 points or 6.1 percent to 806.58. The Semiconductor Industry Association trade group put out its annual forecast for chip sales, and the outlook for next year didn't look good. The SIA expects that worldwide semiconductor sales will decline 5.6 percent next year to $246.7 billion from an anticipated $261.2 billion this year. The SIA said expected drops in consumer spending on electronics, and especially PCs, are behind the forecast.

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