Archive for June, 2010

Internet is the top medium for consumers

Wednesday, June 30th, 2010

Canadians spend 16.6 hours a week online, compared to 12 hours watching TV

Gillian Shaw

The Internet is king in Canada, where consumers say it is twice as important to them as any other medium.

That’s among the findings of the Fleishman-Hillard 2010 Digital Influence Index, released today, which measures Internet influence in seven countries.

According to the study, in Canada we spend an average of 37 hours a week consuming media, second only to people in the United Kingdom, and about a third of that — 34 per cent, or 16.6 hours of that time — is spent on the Internet.

Television lags only slightly behind at 33 per cent, or just over 12 hours a week, followed at a distant third by radio, at 14 per cent, with newspapers rating five per cent of our time and magazines four per cent.

Fieldwork for the study was conducted by Harris Interactive, through a 15-minute online survey of 4,243 Internet users in China, the United States, Japan, Canada, Germany, France and the United Kingdom.

Across all countries surveyed, the Internet has about twice the influence of television and 10 times the influence of print media, the report says.

It’s not that consumers aren’t getting news, but they now prefer it to be delivered online. In Canada, 42 per cent don’t read printed magazines and 28 per cent don’t read the print version of newspapers. In the U.S. that figure is even higher, with 40 per cent of respondents not reading newspapers in their print form.

Advertising dollars aren’t keeping pace with consumers’ preferences, as Internet advertising spending doesn’t reflect the online medium’s influence.

When it comes to social media, all that sharing may be just too much for people.

More than half of the respondents surveyed think people share too much information about their lives, and only a third think user-generated content is interesting.

Canada lags behind other countries when it comes to mobile Internet. Only 16 per cent of Canadians send and receive e-mail through a mobile device, compared to an average of 34 per cent among all countries surveyed. And only 18 per cent of Canadians access the Internet through their mobile devices, compared to 36 per cent on average.

Canadians come second only to the Chinese in social networking, with 63 per cent participating in a social network. Facebook is the Canadian network of choice; almost 70 per cent of Canadians have a Facebook account, compared to an average of 47 per cent among all seven countries surveyed.

And it’s apparent we are among the most Twitter-savvy, even if we’re not all tweeting. Some 85 per cent of Canadians have heard of microblogging, and 18 per cent have a microblogging account, although about a quarter of those microblog less than once a month.

In a caution for tweeting companies, Canadians are skeptical of their efforts. According to the survey, 35 per cent of Canadians — the highest of any country surveyed — think companies that monitor consumer microblogs are “doing it for show and would take no real action.”

© Copyright (c) The Vancouver Sun

Home price index rises 0.8% in April from March

Tuesday, June 29th, 2010

USA Today

NEW YORK (AP) — A key home price index in April rose for the first time in seven months as government tax credits bolstered the housing market. But the rebound may be short-lived now that the incentives have expired.

The Standard & Poor’s/Case-Shiller 20-city home price index released Tuesday posted an 0.8% gain. It had fallen in each of the past six months.

Eighteen of 20 cities showed price increases in April from March. Washington, San Francisco and Dallas each posted gains of 2% or more. Eleven cities reversed their declines from the month before.

Only Miami and New York recorded price declines. New York hit a low since the index first recorded prices there in 1987.

Nationally, prices have risen 3.8% from their April 2009 bottom. But they remain 30% below their July 2006 peak.

The overall price gains highlight the effect of the federal tax credits for home buyers at the start of the traditionally strong spring selling season. Buyers rushed to purchase before the tax credits expired at the end of April. The numbers are likely to drop in the next report.

“Demand for homes has softened since then, and that is likely to weigh on prices, particularly in May and June,” wrote TD Bank Financial Group economist Martin Schwerdtfeger Tuesday. “Weaker sales and still-high foreclosures will likely drive month’s supply higher in the near term, and this will put lid on home prices.”

David Blitzer, the S&P’s index chairman, said the recovery is not getting a consistent and sustained boost from the housing market. He doesn’t expect that to happen until next year.

“Other housing data confirm the large impact, and likely near-future pullback, of the federal program,” Blitzer said.

Last week, the government reported that new-home sales fell in May to their lowest level on record, plunging 33% from the month before. That was the slowest sales pace on records dating back to 1963. Sales of previously occupied homes edged down 2.2%.

Also, homebuilders KB Home and Lennar both reported sharp declines in new home orders in the three months ended in May.

Patrick Newport, an economist at IHS Global Insight, expects prices to resume falling through next year and lose another 6% to 8%. The declines will be widespread, he predicts.

“In two to three months, the indexes for almost all the cities will begin falling again,” Newport said.


Metro area

April-March change

1-year change

























Las Vegas



Los Angeles









New York









San Diego



San Francisco


















Source: Standard & Poor’s/Case-Shiller


Copyright 2010 The Associated Press. All rights reserved.

Businesses urged to be ready, because new tax can be complicated

Tuesday, June 29th, 2010

Fiona Anderson

Some go up; some go down. And some taxes won’t change at all. Check out this clickable chart to find out if the tax on the goods and services you buy most often are changing. Photograph by: Screengrab, Tableau on

According to a recent poll, 47 per cent of small businesses in British Columbia said they weren’t ready to implement the new harmonized sales tax, even though it is less than a week away.

And Ken Ghag, executive director of commodity tax at Ernst & Young in Vancouver says he’s still getting calls from companies asking for help.

For some companies it may be pretty straightforward — just increase the goods and services tax from five per cent to 12 per cent, rename it, and then delete any reference to the seven per cent provincial sales tax. Because in most cases if the item was subject to GST, it now will be subject to HST.

But that only applies to companies whose customers are all in B.C. and don’t sell any items that are subject to the province’s point of sale rebates, which the government has put in place to keep some of the exemptions B.C.’s taxpayers have enjoyed to date.

Then it gets more complicated, Ghag said.

One of the main complications is charging different customers different amounts of tax, depending on where the customer is, he said. For example, if the product is shipped to an Ontario customer, the B.C. business has to charge 13 per cent tax, the rate in that province.

Under the old system, B.C. merchants weren’t registered to collect Ontario tax, so all they charged for out-of town customers was the five per cent goods and services tax. The Ontario purchaser was then supposed to “self-assess” the tax it owed to its own government.

Businesses that sell goods subject to point-of-sale rebates, they have the choice of charging 12 per cent and then rebating the seven per cent provincial portion, or just charging five per cent, Ghag said.

So businesses have to make sure whatever system they use, its up-to date to ensure everything is taxed properly, he said.

And that’s a lot easier than it sounds, with companies like Home Depot and Loblaw Companies Ltd., which owns Real Canadian Superstores, recently admitting they’d been charging B.C. customers provincial sales tax on items that were exempt.

To make sure they don’t make the same mistake, companies should do a “post-implementation review” a few weeks after the HST comes into effect to make sure it’s being charged properly, Ghag said. “Because you don’t want to have that Home Depot situation a year down the road [where] people find you’ve been charging the tax [when you shouldn’t], he said. “The reputation risk is pretty high for these retailers.”

On the flip side, companies should also make sure they are properly keeping track of the amount of HST they are paying so they can make sure they get it all back.

Because the advantage of the HST — a value added tax — is that only the final consumer pays the tax. That means companies who charge HST get refunds for the tax they pay.

While companies are used to updating their systems for tax changes, the switch to HST is on a much broader scale than they’d be used to, so there is a lot to do, Ghag said.

And if that wasn’t enough, an unrelated change means that starting July 1, companies with revenues of more than $1.5 million a year now have to file their returns electronically.

© Copyright (c) The Vancouver Sun

Stay safe online

Monday, June 28th, 2010

Take a minute to think about how much of your life relies on the Internet.


Think about school (enrolling in classes, paying tuition), work (sending/receiving e-mails, making payments), transportation (booking flights, requesting quotes on cars), and even entertainment (online shopping, downloading music).

Now, think about what might happen if the security of all of these activities was compromised. Someone may have hacked into your university account because you used a public computer, or someone may have gotten a hold of your credit card information because you used an untrustworthy site to buy something.

So, you might be asking yourself, “What can I do to protect myself, my business, and my children from this phenomenon that has become such a large concern in the information world?” The first step to solving a problem, or better yet, preventing one, is knowing your enemy. Breaches in cyber security occur because, somehow, someone was able to access your information.

There are so many ways to equip yourself with the information that will motivate you to take any steps you can to navigate safely online at home and at work, protecting your business’

information, data, and money.

Protecting your business

Companies are at risk of any type of cyber attack, and businesses can be victims of “people who break into computer systems for criminal financial gain, espionage or politically motivated reasons.” Stay Safe Online. org advises businesses to assess any possible risks, monitor possible threats to the business, and draft a cyber plan.

Home business owners are also at risk, where just as much, if not more, damage can be done. Aside from keeping up-to-date on all software, it is important to choose passwords for online accounts that don’t contain dictionary words or clues that could be found from other obtained personal information.

Photos for sale

We all learned something about Facebook recently, most commonly by word of mouth, that shocked and dismayed. It seems that any photos you post on Facebook are now and forever the personal property of Facebook. This can cause major problems with models and photographers trying to market their work. Yes, it is an outrage, but Facebook hasn’t broken any laws… we just never read the fine print.

Here’s what it says: “By posting User Content to any part of the Site, you automatically grant… an irrevocable, perpetual, non-exclusive, transferable, fully paid, worldwide license…to use, copy, publicly perform, publicly display … such User Content for any purpose…”

It’s things like this that we need to be careful about-things that might be a minor inconvenience to one person, or a career-killer for another. In this case, knowledge is power.

The future of the web

The worry doesn’t end there. Your kids are also becoming well-versed in how to use the Internet, but do they know about all of the possible ways they could be at risk? Most children learn to not share their passwords and to not give out personal information to strangers in chat rooms. However, problems can reach much deeper than that. There’s also spam and sexual exploitation. In fact, “one in seven youths receive a sexual approach over the Internet.”

If we’re too late and a problem has already occurred, contact The Canadian Cyber Incident Response Centre (CCIRC) at information and help.

– – –


Password protection

1 Don’t choose obvious passwords for any online accounts and sites.

Update your software

2 When your computer gives you the option to update your antivirus software, do it! Think about it as your fire alarm. You’d never let the batteries die because if they do, your house and everything in it, including your family, could be at risk. Your files need protection, too.

Spread the word

3 Take everything you learn about Internet safety and spread the word-to family, friends, and coworkers.

© Copyright (c) The Vancouver Sun

The rise of cloud computing

Monday, June 28th, 2010

Question: What is Cloud Computing? Answer: It’s the methodology of processing something over many machines spread across a network.

Boyan Tsolov


Cloud Computing is the methodology of processing something over many machines spread across a network. The idea is that you ‘outsource’ the processing that your computer would normally do itself to another computer(s) on a network.

You do not necessarily know where this computer resides in the world or how many computers are being used. That is why it is called a ‘cloud.’

In short, the processing is outsourced to a third party and the result is returned to you.

Out of this “service” comes three ways to provide cloud computing:

SaaS: Software as a service

1 In this type of computing, the software is offered online

through a browser. It is hosted on the provider’s servers. The users do not need to install the software on their machines. The provider manages the servers that host the software, they update the software at their convenience and they fix bugs on it directly.

PaaS: Platform as a service:

2 In this type of computing, the provider has exposed a means for writing applications on their servers. This is possible because the third party company has provided their own APIs (Application Programming Interface) for you to program with. When the developer programs their components, these components then run on the servers, in the cloud. The developers don’t need to worry about hosting them on a website; the provider takes care of that.

IaaS: Infrastructure as a service

3 In this case, companies provide a means for their users to use an entire computer ‘in the cloud’ as if it is in your office. This means that you do not need to buy new machines and set them up with a network in your office. You can ‘create’ a new machine through the provider and then log into it using common software like remote desktop. If you feel that you need more machines to run your website, you can add more at the click of a button.


– Maintenance: The provider maintains the computers, meaning the users need not know anything about computers–they just need a connection to the internet.

– Security: The providers are responsible for this, instead of the users if the software/website was on their own machines.

– Reliability: When something is in the cloud, it is usually very reliable in terms of up-time.

– Scalability: You can grow the computing power at an instant.

– Location: As you add more computing power, it can appear anywhere in the world. However, ideally you would like the location to be as close to you as possible.

– Cost: Since you are paying per machine or per resource (e. g. per CPU, per GB used, per software feature) it is cheaper to afford as much computing power as you need. Small businesses can use this to get started because they might not have money to buy big servers to place in their office from the get-go.


– Data privacy: The provider has all of your data on their servers.

A hacker can get to it.

The company might go bankrupt.

Negligence on their part can lose your data.

You have less control of the software and the data.

– Security: Just as it is a pro because you don’t have to worry about it, if the provider is not careful they might expose a lot of your data.

© Copyright (c) The Vancouver Sun

Protecting yourself against the web

Monday, June 28th, 2010

Cassandra Alexopoulos


– Question: When you’re shopping online for the perfect Father’s Day gift, is your credit card information safe? When you’re accepting a friend invitation on Facebook from a person you’ve never heard of, are your personal data and pictures secure?

– Answer: Not necessarily. In fact, all it takes is one weak link for your information to be used or made public.


Cyber security battles against a spectrum of issues, both minor and severe, that we should all be aware of. Cyber security is breached when we become victims of something life-changing like identity theft. Or, we can be annoyed and inconvenienced by receiving spam mail every 15 minutes, even humiliated if an embarrassing video or photo has leaked.

“This is dangerous because the Internet is becoming less and less anonymous, meaning we are becoming accountable for what we say and post,” says Ashley Huffman, online communications manager at Kiwi Commons, creators of videos and editorials to build a line of communication between youths and adults when discussing Internet safety.

Bad publicity

The sad truth is that we are so comfortable with posting personal information for social and entertainment purposes, we remain unaware of the fundamentals of the Internet-that once it’s out there, it’s out there for good.

Be careful of the nature of photos you post on your social networking sites. Risky and embarrassing photos include those that contain alcohol or a person who is clearly under the influence of alcohol, provocative poses, and even TIP 3

wardrobe malfunctions!

Buyer beware

Online shopping has become a widespread activity with many obvious benefits: lower prices, more variety, and, best of all, convenience. However, if you’ve found that iPad for half the retail price on an unknown website, your information and money are both at risk. Chances are if it seems too good to be true, it probably is.

Don’t be afraid to take a few minutes and read reviews that users have posted on online shopping sites. These will usually help you determine the legitimacy of the site.

This isn’t to say that online shopping, along with creating a Facebook account or sending pictures to your friends via e-mail, can’t ever be safe. The main thing to remember is: trusted friends only. Shop with famous and reputable websites, accept friend invitations from people you recognize, and open e-mails from e-mail hosting services you are familiar with.

Continue to enjoy the Internet for all that it has to offer, but don’t ignore those red flags.

– – –


– Court orders to remove embarrassing photos from the Internet do not mean that the photos won;t still be circulating the web remaining accessible to all, including your family members and current or future employers.

– Identity theft can occur by obtaining information as simple as your full name and location. Your information could be used for obtaining passports, accessing the funds in your bank account, and applying for new credit cards.

– Someone has their identity stolen every four seconds in the United States and affects thousands every year in Canada.

Read more on the web:

© Copyright (c) The Vancouver Sun

How to talk to your kids about internet safety

Monday, June 28th, 2010

Cassandra Alexopoulos

We’ve come a long way since 60s’ parenting scare tactic “It’s 10:00 pm. Do you know where your children are?”

The reality is that you’re probably quite trusting of your children if they have their own computer with the ability to post videos on YouTube or photos of the party they attended Saturday night on Facebook.

While the Internet has its obvious benefits of being educational and entertaining, there are also a lot of troublesome situations your children could encounter online.

Firstly, remind your children that anything they put up on the Internet is public and could have serious consequences in the near and far future, potentially costing them their dream job or an athletic sponsorship.

Ashley Huffman of Kiwi Commons says, “More and more employers are using social media profiles as part of their decision process when hiring (sites like Facebook, Myspace, Linkedin).” These sites are also a convenient gateway for online predators to communicate with children under a pseudonym.

Cyber bullying

Another online concern is cyber bullying. Children have the opportunity to anonymously embarrass or threaten a classmate on the Internet. If you find out that your child is a victim of a cyber bully, tell him or her to keep a record of everything that was said, because it could be helpful when the child feels comfortable enough to speak to an adult about it.

Parents should also ensure that they “don’t overreact if their children have a negative experience online (research has shown that youth often don’t report being the victims of cyber bullying because they’re afraid their parents will cut off their Internet access),” says Matthew Johnson, media education specialist at Media Awareness Network.

© Copyright (c) The Vancouver Sun

Phishing, pharming and bots

Monday, June 28th, 2010



“Lions and tigers and bears–oh my!” Dorothy and her companions chant to ward off their fears in The Wizard of Oz. Internet users might try, “Trojans and rootkits and bots!”

Dorothy’s fears were mostly imaginary, but the threats online are all too real–and growing. Malware, malicious software, has become a leading online scourge, evolving in a short decade from so-called worms and viruses conceived principally to vandalize, to sophisticated spyware and crimeware designed to steal– money, information and identities.

Kaspersky Lab, a security firm specializing in combating malware, collected nearly 34 million malicious programs by year-end of 2009–including some 15 million each in 2008 and 2009. In its Security Bulletin 2009, the company says “programs became significantly more complex in 2009 and targeted new platforms such as mobile operating systems.”

Symantec, a leading online security company, says on its web site, “The threat landscape once dominated by the worms and viruses unleashed by irresponsible hackers is now ruled by a new breed of cybercriminals.”

Malware has long been delivered hiding inside trojans–innocent-appearing emails or software. In an irony only a cyber criminal could appreciate, 2009 saw big increases in rogue antivirus software used as malware delivery vehicles, according to Kaspersky. Once launched, rootkit programs keep the invasive software concealed.

Phishing is a favorite technique

Emails that use fear or enticement to encourage recipients to click on a link or visit a web site that steals or corrupts their data. Pharming programs are even more insidious–they redirect unsuspecting users to fraudulent web sites, even if the user types in a correct URL. The bad guy’s goal is installation of spyware on your computer or network–programs that log your keystrokes, steal usernames and passwords, or enable access of your bank or credit card accounts.

Yet another set of applications can turn your computer into a zombie or bot–essentially a dedicated slave used by cyber criminals to launch anonymous spam assaults or distributed denial of service (DDoS) attacks against the online presence of a company, organization or entire nation. Estonia, Georgia, South Korea and the United States have been targets of DDoS attacks in recent years.

The complexity and sophistication of cyber crime grows quickly, but–fortunately–some of the best defenses remain straightforward and based in common sense. Don’t open (and do delete) unsolicited emails. Don’t click on unfamiliar links, even if sent by someone you know (their computer could be being used as a bot). Don’t download software from a strange web site (no matter how enticing the deal)! Scan all emails and files with a recognized antivirus security program. Keep all security patches up-to-date.

Online threats are real. You need more than a catchy chant to protect yourself.

© Copyright (c) The Vancouver Sun

Don’t like your Olympic village deal? Call the condo litigator

Monday, June 28th, 2010

Miro Cernetig

The billion-dollar Olympic village has no shortage of hurdles to profitability: a runaway construction budget, the global banking crisis that panicked its mortgage lenders and a business model based on a post-Olympic real-estate spike yet to materialize.

But now there’s a new challenge — the condo litigators.

They look for people who have made hefty deposits on condos and want out of their contracts.

One of Vancouver’s key practitioners of this obscure legal art is Bryan Baynham, a star in the Harper Grey legal firm.

He says he’s already found 11 people — with deposits as high as $300,000 — who want out of their Olympic deals because they’re unhappy their unit’s washer-dryers aren’t in place, or the electric fireplaces aren’t up to snuff, or there isn’t as much park land around them as they hoped.

Now, the City of Vancouver, which holds the debt on the Olympic village and wants to see its condos sold quickly and at the highest price possible, is pooh-poohing this setback. The city suggests that 11 people getting cold feet out of 264 condo pre-sales isn’t a stampede. After all, it still means a 95-per-cent completion rate.

But the reality is things could get a little tougher if this become a trend. The city still has 437 of the Olympic village’s 737 condos left to sell. If Baynham’s legal challenge works, the city would have 448 condos to sell. And that number may still grow.

That’s because our local condo litigator hasn’t given up trolling for more clients hoping to bail on the Olympic village. In fact, Baynham’s website posits all sorts of worrying reasons, all unproven, why people may consider bailing on their condos. Here are a few snippets from his June 8 posting, entitled “Millennium Water Condo Development: You may not have to close.”

Baynham writes: “If you are a pre-sale purchaser in the controversial and financially-plagued Millennium Water Condo Development … and are being pressured to close, you might want to consider obtaining an opinion concerning your rights, obligations and options.”

He asks: “Has the project met your expectations? What really happened with the financing and does it affect your obligation to close? Where do things stand with respect to social/subsidized housing in the development?”

His website also consumes a lot of space telling buyers why the Olympic village may not be the winning real-estate deal some envisioned.

One of his theories is there may be a serious challenge to turning over units after closing their sales. He writes: “The Millennium has released more units for sale. If you plan to sell your unit shortly after closing, you may well be selling into a falling market in competition with the developer’s marketing machine. …”

Baynham also raises the prospect of the Olympic village filling up with — gasp! — renters, not people who own their own units: “More than one pre-sale purchaser has expressed concern to us that Millennium/the City may have no alternative but to rent unsold units.

“In any event, it appears that many of the units have been, or will be acquired as an investment, with the intention that the unit be rented for the foreseeable future. If that turns out to be the case, do you want to own/live in a development where the Strata Corporation is controlled by the developer/investors, as opposed to owners who live in their units?”

Now, people have the right to seek legal advice and search for ways to get out of a condo contract. And a lawyer is justified in drumming up business where he or she can find it. You may not always like it, but it’s the system.

But Vancouver taxpayers should pay attention to this. If real-estate speculators start to see this as a way of wiggling out of condo deals, figuring their Olympic village gambles aren’t going to be the easy money they thought, it could be a serious blow to making good on Vancouver’s $1-billion investment.

© Copyright (c) The Vancouver Sun

SanDisk CEO Eli Harari proves he’s no flash in the pan

Monday, June 28th, 2010

Jon Swartz
USA Today

“Ideas are a dime a dozen,” Sandisk CEO Eli Harari says. “It’s what you do with a great idea, to create big markets, that matters.” – Sandisk

LOS ANGELES — At 43, Eli Harari was at a career crossroads — some might argue, nadir.

He was freshly ousted from Waferscale Integration, the computer-memory start-up he’d founded three years earlier, after a dispute with the board over strategy and direction. “It was an unmitigated disaster. I was an also-ran,” says Harari, now 65.

That’s hardly the self-assessment you’d expect from a CEO who nurtured his next start-up —SanDisk into a $3.6 billion enterprise whose storage devices are used in thousands of products from iPods to digital cameras and smartphones. Along the way, he helped redefine an entire product category — flash memory — that fomented the digital photography revolution.

On a cool June morning here, he’s introduced as one of the most successful executives in the world at The Israel Conference. Harari is a featured speaker at the conference, which brings together American companies looking for sources of technological innovation and Israeli companies looking for partnerships and greater knowledge of global markets.

“Now, as always, is the best of times to start your company,” Harari tells the audience. Highlighting his point, he explains what is inscribed on SanDisk’s business plan. It’s a quote from Jewish religious leader Hillel: “And if not now, when?”

Harari used his disappointing experience at Waferscale as entrepreneurial fuel, striking out on his own with SanDisk and creating the multibillion-dollar flash-memory industry from scratch. He has navigated recessions and reinvented the company repeatedly during his 22-year tenure. The Israeli immigrant is a prototypical Silicon Valley pioneer, combining expertise in physics, marketing moxie and persistence. What sets him apart is his unassuming nature.

“It’s amazing what you can achieve if you don’t mind that somebody else gets the credit,” he says.

Harari is one of a handful of people in Silicon Valley still in charge of the company they founded. He declined to comment on his long-term plans at SanDisk, but he says constant change has kept him at the company since Ronald Reagan was president.

“As a physicist, I love (the concept) that the pace of change is accelerating — often exponentially,” he says.

“I think I’m probably the least-stressed person here,” he says. “Not because I’m a slave driver, but because I want balance in my life.”

Harari has thrived in a cutthroat industry while more-famous peers pursued other goals, such as the California governorship (former eBay CEO Meg Whitman) and philanthropy (former Microsoft CEO Bill Gates); were jettisoned (Sun CEO Jonathan Schwartz); or had extended hiatuses (Apple CEO Steve Jobs).

“He’s low-key, a gentleman,” says Randhir Thakur, a former SanDisk executive who is now at Applied Materials. “Eli is comfortable in his own skin.”

Humble origins

Exhibit A of Harari’s tireless persistence is SanDisk, which he helped nurse from a 2,000-square-foot office in Santa Clara, Calif., to a global operation of 3,300 employees in eight countries.

Last year, SanDisk was tops in the flash-memory-card market, with $2.8 billion in revenue, good for 37% market share, according to market researcher Gartner. Toshiba was second, with $1 billion, or 14%. (Samsung had 38% market share for the larger-flash-memory market, compared with SanDisk’s 34%, according to investment bank Deutsche Bank.)

Harari’s contributions to technology — he holds more than 100 U.S. and international patents in non-volatile semiconductor devices — landed him a job at Intel. But Intel’s tepid interest in flash prompted Harari to start Waferscale and, three years later, SanDisk. (Waferscale was sold to semiconductor company STMicroelectronics in 2000.)

He’s also a tinkerer who has dabbled in prototypes for new fishing rods, flea collars and screwdrivers. If not for his wife, Britt, Eli says, he might have ended up pursuing the next pocket fisherman gadget instead of SanDisk.

“Ideas are a dime a dozen,” Harari says, repeating a favorite line of his. “It’s what you do with a great idea, to create big markets, that matters.”

Harari’s greatest inspiration — for the founding of SanDisk in 1988 — was hatched with Sanjay Mehrotra, a former Intel colleague of Harari’s, and Jack Yuan, a Hughes Microelectronics veteran.

The trio struck upon the idea during meetings in Silicon Valley over several months. But when they came up with the notion of new flash-memory chips as a small, rugged, low-power alternative to hard disk drives, some investors balked.

Still, with early funding from venture capitalists, AT&T and Western Digital, SanDisk developed its first 4-megabyte flash chips and outbid Intel and Texas Instruments to nab IBM as its first customer. By 1995, SanDisk was working with Kodak, Polaroid and Canon to develop specifications for a succession of removable flash-card standards.

SanDisk has survived five economic downturns and steadily grabbed market share.

“We thrive on chaos,” Harari says. “Mobile is the new wave, yet we started a team called emerging markets for mobile seven years ago.”

Harari’s conviction was underscored when he rejected rival Samsung’s $5.85 billion hostile takeover bid in 2008 as too low, prompting flak from SanDisk shareholders. “He believed flash has huge potential, and he was determined to see his vision through,” says Kevin Cassidy, an analyst at investment bank Thomas Weisel.

‘Extended family’

Flash storage may be “disruptive technology” — as Harari likes to say — but one would be hard-pressed to find a more accommodating CEO. Possessing a warm smile, Harari is SanDisk’s kindly uncle, engendering fierce loyalty. “Our motto is ‘Be nice,’ ” the soft-spoken Harari says. “But we never, ever give up.”

“The company is his extended family. He loves it, and you see it,” says SanDisk general counsel Jim Brelsford, noting the company’s low turnover rate, especially among engineers.

At an all-hands meeting in late April, Harari hugged and slapped the backs of employees celebrating 10-, 15- and 20-year anniversaries. “If you are doing well, Eli will hug you,” Thakur says.

Such compassion showed after Brelsford’s college-age niece, Christa Brelsford, was severely injured during the Haitian earthquake. (She is now recuperating.)

Harari, who was overseas on an important business trip, saw a TV report on Brelsford — whom he had never met — and wrote her a heartfelt note.

The family vibe was on further display this month at SanDisk’s 11th annual international day, a food-and-music festival that celebrates the heritage of its workers, who hail from 36 countries.

Sometimes, the loyalty runs too deep. Harari shakes his head recalling a recent hospital visit to see a longtime engineer battling a brain tumor. The engineer wanted a laptop in order to do some work, which Harari quickly scotched.

“It blew me away,” Harari says.

While “most guys are over the hill” at his age, as Harari jokes, he’s driven by anticipating the future. Sort of like a Hall of Fame hockey player who had an uncanny ability to anticipate the flow of a game.

“We do what Wayne Gretzsky used to do: We skate to a spot before the puck gets there,” he says.

In a 1999 presentation to investors, Harari accurately predicted that the market for flash memory would be as big as that for hard disk drives. “I was convinced the mobile market was the (computing) platform for the coming decade,” he says now.

The prediction looks good today. Total flash sales were roughly $20 billion last year, and industry analysts are forecasting more than 30% annual growth over the next few years, says the Semiconductor Industry Association. Sales of hard disk drives, by comparison, were $30 billion in 2009 but are growing just 10% annually.

Thinking in the air

Harari, who does a fair bit of traveling to SanDisk’s operations worldwide, does most of his best thinking on overseas flights. On such excursions, he’s conjured new flash-memory-cell architecture and production innovations, Mehrotra says.

“He is a believer in his vision, his principles,” says Harari’s longtime friend, Levy Gerzberg, CEO of Zoran, a developer of chips for DVD players and cameras. “He never gives up and is not afraid to take risks,” he says. “You have to, to become an industry leader.”

Gerzberg, who founded Zoran in 1983, has known Harari as long as anyone: 30 years. They met when Gerzberg was doing research at Stanford in the integrated-circuit laboratory. Harari was working at Hughes at the time.

They have much in common. Both were born in Israel in 1945 and moved to the U.S. to complete their academic studies. Doting grandfathers, they frequently travel to their homeland on business, where they share laughs and reflect on “how we grew from nothing to (building multimillion-dollar) companies,” Gerzberg says.

“You never know what life will deal you,” he says.

Copyright 2010 USA TODAY