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From Spielberg To Supercomputers


In Business This Week: HEADLINER: EDWARD McCRACKEN

FROM SPIELBERG TO SUPERCOMPUTERS

For years, Edward R. McCracken, chairman and CEO of Silicon Graphics, has seen his company's high-powered computers create dazzling special effects, such as the dinosaurs in Jurassic Park. If all goes well, McCracken will soon enter the world of high-end supercomputing, as used by government code-breakers and nuclear-weapons designers. On Feb. 26, Silicon Graphics agreed to buy supercomputing market leader Cray Research for a combination of stock and cash worth $783 million. The deal will boost SGI's annual revenues to more than $3 billion. Cray, which expects to see profits improve this year, will act as a buffer against competition from Sun Microsystems and Hewlett-Packard. McCracken plans to keep Cray and SGI operations separate but may partially merge their computer designs. SGI may also use Cray to crack the commercial market, where supercomputers are used to search through huge databases. If he succeeds, he's betting it will have a special effect on SGI's bottom line.EDITED BY KELLEY HOLLAND By John W. VerityReturn to top

CUBA: BUSINESS WON'T SHY AWAY

RELATIONS BETWEEN THE U.S. and Cuba have hit a nadir in the wake of Cuba's Feb. 24 bombing of two civilian planes. President Bill Clinton immediately cut off charter flights and reached an agreement with Republican lawmakers on a bill to tighten the U.S. embargo against the island nation. But while the fallout may temporarily hurt U.S.-Cuba diplomatic relations, experts say, it won't diminish business interest in Cuba. John Kavulich, president of the U.S.-Cuba Trade & Economic Council, says about 1,300 U.S. business executives visited Cuba in 1995 on authorized trips, and more are expected this year. If the U.S. wants influence with Cuba, "the most important thing the U.S. could do would be to open industry and business totally and encourage companies to go there," says Archer Daniels Midland Chairman Dwayne Andreas, a critic of the embargo.EDITED BY KELLEY HOLLANDReturn to top

MICRON'S CHIP FACTORY: ON HOLD

WILL LATER BE BETTER THAN never? Micron Technology, the Boise (Idaho) company that ranks among the world's top 10 chipmakers, said on Feb. 26 that it won't finish its new $2.5 billion chip factory on schedule. Equipment worth hundreds of millions won't be installed until the market for memory chips, especially dynamic random-access memory chips, improves. DRAMs account for the bulk of Micron's $3 billion in annual sales, and DRAM prices have plummeted. Now, Micron may have to borrow to finish the plant, whose cost is now nearly twice as high as the original plan.EDITED BY KELLEY HOLLANDReturn to top

ON THE TRAIL OF HIGH-TECH SCAMS

BONNIE AND CLYDE, MOVE over. Congress is sounding alarms on high-tech financial crime. The House Banking Committee held hearings on Feb. 27 and 28 to examine the threat from counterfeiting, bank theft over global banking networks, and credit-card fraud. Committee Chairman James Leach (R-Iowa) has introduced legislation that, among other things, would raise the maximum sentence for counterfeiting to 25 years. Many scams are believed to be tied to international organized crime networks. Counterfeit $100 bills are now so common that the government is about to introduce new C-notes.EDITED BY KELLEY HOLLANDReturn to top


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